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PAGE EIGHT
THE JEFFERSONIAN
PUBLISHED BY
THOS. E. WATSON and J. D. WATSON
Editon and Proprietors
Trmplk Court Building, Atlanta, Ga.
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Enttrrd at Pttnfict, Atlanta, Ga., January 11, IQO7, ai ttctnd tian mall matttr
ATLANTA, GA., THURSDAY, DECEMBER 19, 1907
A National Banker Butts In.
Elsewhere will be found a letter from our
good friend, Mr. Reynolds, of Rome, Ga.
It was very courteous of Mr. Reynolds to
offer his communication to the Jeffersonian,
and it gives us pleasure to make room for it.
If we are not mistaken, it was Mr. Reynolds
who undertook, in the New York “Watson’s”
to refute the statement that the Panic of 1893
was a bank-made affair. Our recollection,
moreover, is that so much evidence was pro
duced by Mr. W. S. Morgan, of Arkansas, to
prove that the Panic of 1893 was bank-made,
that Mr. Reynolds retired from the controver
sy.
In his present effort to overthrow the state
ment that the National banks pay practically
no tax, Mr. Reynolds overlooks several im
portant facts.
(1) The Act of Congress of 1900 cut down
the tax on circulation one-half, and therefore
his calculation is built on a foundation that has
been materially changed.
(2) He does not, as I did, take into consid
eration all of the expenses incident to the Na
tional Banking System.
(3) The present annual revenue to the Gov
ernment on National bank circulation is, in
round numbers, only two million dollars, Sure
ly Mr. Reynolds does not think that this piti
ful sum more than covers the cost of furnish
ing house-room for the Currency Bureau, safe
ty vaults for the storage of the bonds ; furnaces
for the “burning to ashes” of “worn and muti
lated notes”; expensive office furniture, books
of account, stationery, etc.; the cost of dies and
plates for the fine engraving which has to be
done on the notes; the fire-proof vaults re
quired by law for the safe keeping of the dies
and plates, etc., etc.
(4) Mr. Reynolds takes it for granted that
the working expenses of the Currency Bureau
represent the cost to the Government of the
National Banking System. By no means. Let
Mr. Reynolds turn to the Act of 1864 creating
these banks and he will be surprised to see
how much of the work and the expense of the
Currency Bureau is thrown upon the Treasur
er’s Office —thus greatly increasing the cost of
that department.
Mr. Reynolds takes the position that the
Government has made so much money out of
the national banks that it could afford to pay
every dollar that depositors lost, and still have
“a net profit of $55,340,061.”
All things considered, I take this statement
to be one of the most remarkable that’ ever
came under my eyes, or into my ears.
The Government has actually made “net
profits” off these poor, down-trodden national
bankers, and therefore ought to make good
their defalcations!
Lord! have mercy on us.
What are the facts—facts which reveal a
nation’s shame, a nation’s loss, a nation’s slav
ery to a favored class?
The Government had issued its own notes,
as full legal tender money, because the war
expenses were more than a million dollars a
day, and the banks had suspended Specie pay
mente. Ne gold and silver were to be had.
THE JEFFERSONIAN.
Treasury notes had to be issued to save the
Government from absolute financial starvation.
The treasury notes thus issued never for
one moment sank below par. Why should they,-
when a paper dollar would do for its owner
every blessed thing that a coin dollar would
do?
The full legal tender notes of the first issue,
$50,000,000, remained the full equal of gold and
silver dollars until the bankers went to Wash
ington and got Congress to say that the notes
should not be legal tender for Custom house
duties and for interest on the bonds.
Then, indeed, the paper notes sank under this
foul blow, until it took three of the Govern
ment’s notes to equal a silver or gold dollar.
How much did that conduct of the bankers
cost the Government and the people?
It cost them the full extent of the deprecia
tion of the paper money.
Who reaped the “net profits”? The bankers,
who gathered in the depreciated currency,
swapped it, dollar for dollar, for long-term
bonds, and then got Congress to declare that
their bonds must be paid in coin.
In other words, the Government was influ
enced to sell bonds for one kind of money and
to redeem them in another.
Paper was good enough when the bankers
were buying the bonds, but not good enough
when pay-day came.
Who scooped the “net profits” on that grand
series of deals in bonds?
The banker did it.
How much did the Government and the
people lose?
The full amount of the difference between
the depreciated currency in which the bonds
were bought and the coin in which they were
paid.
And the sum total of that colossal loot is
so enormous that the mere tables of figures
make no adequate impression on the average
mind.
But when the poor human underdogs look
up at the swollen fortunes of some of our
Northern and Eastern money-kings, wondering
how on earth some men accumulated such
incredible wealth, let them be told of the
awful crimes that were committed in the name
of Finance during and after the Civil War.
There’s where this vast inequality of riches
began.
Who was it that compelled Hugh McCulloch
and other Secretaries of the Treasury to “burn
to ashes” eighteen hundrd million dollars of
the paper currency of the Country?
The national bankers did it.
Why?
To drive out of circulation the notes of the
Government, to put their own paper into cir
culation, to lessen the volume of real money
in order that they might control it, and have
the busmess world at their mercy.
Who made the “net profit” in these raids
against the paper money of the Government?
The national bankers and other money-kings
did it. And the amount of the loss to the Gov
ernment and people, during all those years of
falling prices, when the money was being call
ed in and burnt, God only knows.
It was prodigious.
So frightful was the decline in values,
brought about by the destruction of the cur
rency, that in 1889 after the Government had
paid on the public debt three and a half billions
of dollars, in principal and interest, it would
have required more corn, wheat and cotton, at
prices then prevailing, to have paid off the
remainder of the public debt than it would
have required to pay off the whole debt at the
prices which prevailed in 1866.
Who brought on the Panic of 1893?
The national bankers.
For what purpose?
To compel Congress to make gold the mon
ey of final redemption, so that they could aug
ment their own power and profit.
Who forced those bonds from Cleveland’s
second administration? Who pocketed the
“net prefits” on that disgraceful deal? Who
brought on the panic of 1907? Who forced
bonds from the Roosevelt administration?
Who is scooping the “net profits” on 3 per
cent treasury notes which they buy without
further cost than an entry on their books?
Who is it that gets compound interest on
from ten to thirty dollars more money than
is invested in their business? Who is it that
gets the use of $250,000,000 of the Govern
ment’s funds without a cent of interest? Who is
it that collects interest on his bonds in advance,
and thus has both principal and interest loaned
out at interest AT THE SAME TIME?
Who is it that pays no tax and thus con
tributes nothing to the Government whose
favors enrich him ? Who is it that not only has
the use of the Government’s credit in his busi
ness, but has the Government’s cash also?
POOR, DOWN-TRODDEN NATIONAL
BANKER!!!
* *
The Clearing House Certificate.
Certain eminent financiers of New York,
engaged in the pleasant pastime of using the
credit of the Government for their own profit,
will wake up one fine morning and find them
selves unable to pay their debts.
Instead of going out of business, as bank
rupts usually do, these eminent financiers
agreed among themselves that they would
put forth a written statement of their inability
to pay their debts, and would compel 85,000,-
000 people to use these badges of dishonor AS
MONEY.
And they have done it!
A Clearing House Certificate (‘is nothing
more, than a confession that the bankers issu
ing them are unwilling, or unable, to pay their
debts.
Ou these statements that they are bank
rupt, they collect interest, just as though these
badges of dishonor were good money.
This being so, consider for a moment what
these national bankers are doing.
First, they draw interest on the money in
vested in the bonds —paying no tax.
Second, they draw interest on the same mon
ey, represented in the notes issued to them by
the Government —paying, practically, no tax.
Third, they inflate their loans, checks, and
drafts until they draw interest on from ten to
thirty times as much money as they have in
vested.
Fourth, when pay-day comes, and they find
it an impossibility to meet their honest obliga
tions, they issue a statement to that effect, call
it a Clearing House Certificate, and force it in
to circulation as money.
Thus they turn bankruptcy into a huge prof
it, and get interest upon a confession of fail
ure.
Yet these are the gentlemen who wanted
Honest Dollars!
These are the gentlemen who railed against
silver dollars because the metal in the coin was
only worth fifty cents.
These are the fellows who jeered at Green
backs, and said that these treasury notes con
stituted the dangerous feature of our financial
system.
These are the fellows who could lay their
tongues to no words too bitter and abusive
for the Farmers’ Alliance and the Labor Un
ions, when those wealth-producers implored
the Government to supply the country with a
larger volume of real money.
And now look at the situation which they
have made! *
Business demoralized, loans stopped, colled
tions at a standstill, confidence gone, the couni
try merchant and the farmer in distress an/
fearful of next spring, depositors clamoring f 'A
what is theirs and being told they can’t hr 4
it, nasty little clearing house certificates ' \
bauching the currency, and tempting the co
terfeiter, Six thousand national bankers he
ing up the entire nation and shearing it an
shepherd would his sheep. I;
These are the men whose infernal greed <
selfishness could not be content with the fin <
eial system fixed by our forefathers. Tj