Newspaper Page Text
IRUARY 14, 1913
Mysterious Move by Treasury Department
blowing is a United Press dispatch: Now
:, Feb. 7. Financial storm possibilities will
JaasBBBsWront President Woodrow Wilson immediately
it his inauguration unless congress promptly
estigates the cause and purport of "Treasury
ular No. 5," issued January 9, last, accord-
to the assertion hero today of. Rudolph
eckles, president of the First National bank
San Francisco, and prominent progressive.
This circular directs that customs money
deposited with national banks. I believe this
er is in direct conflict with the law govern-
control of these moneys and must therefore
rescinded," said Spreckles.
Jit seems strange that the present adminis-
tlon should issue such an order on tho eve
going out of office.
.'We havo a right to question the motive that
prompted such action.
i'lf this order be not promptly rescinded, wo
4"will witness a marked and unusual increase of
deposits, principally with tho Now York national
hanks, amounting to more than $200,000,000
gold annually in New York alone.
VjKWUen the new administration takes charge
ithe treasury, it will bo obliged to demand the
gaturns of these funds to the government.
I" The effect of the withdrawal of so many rail-
MWUB OL UOUiU'S IB UUUI1U lO CUUSO UUUUUliU
L"In. any case it seems an uncalled for move
Is. time of year when there is no unusual de-
WT . . . , . m
'itfimana tnrougnout tne country ior money, as is
case during the- crop moving period.
'I believe the people are entitled to know
rho it Is that is responsible for tho plan and
iy it was put out at this time.
'Congress should Investigate the matter and
:ing out the facts.
''On the face of the treasury order, there is no
lecific provision that the banks shall give
Ifcurity for the deposit and no provision that
Key shall pay any interest."
KThe funds affected by the order were held in
,Ke sub-treasuries previous to February 1, when
Ova nnr1oi tuon f Tnfn nfPnofr Aa flm rnvornTtl(itll'
, accepts only gold in payment for duties, tho
ientire sum involved is gold.
'Spreckles pointed out that if the banks made
use of the money, they would have to uso it in
Such a way as to have it subject to call on
notice from the government. For this reason,
lie said, tho money would find its way through
Hie usual channels into Wall street, to bo loaned
iut at call. Therefore, Spreckles said, in the
event of the millions being suddonly recalled, tho
demand would go directly into tho call money
market In New York and force the Immediate
withdrawal of enormous sums.
iShould the order remain in effect until March
I4y It was pointed out by Spreckles, President
Kyilson would face a situation where, to leave
the order in effect, would involve the govern
ment's money more and more every day and to
rescind the order would cause great financial
It is Spreckles' opinion that the order will -bo
held illegal and that Wilson will be compelled
to rescind, if it is not rescinded sooner.
Friends of Wilson have been informed re
garding the situation and they recalled Wilson's
public announcement that be would "erect a
rglbbet as high as Hainan's" tor any man rouna
'guilty of bringing about a panic.
' yl It is known that the situation has been pro
&' sen ted to Wilson personally.
Rudolph Spreckles organized and conducted
the progressive republican Wilson league In the
recent campaign. He had supported Senator La-
Fpllette as long as La Folletto was a factor in
the contest. Spreckles is a member of th
wealthy sugar family of California and a million
aire himself. He personally financed the fa
mous graft prosecutions In San Francisco.
"I shall go tp Washington very soon to seo
that the facts a,re presented to prominent mem
bers of congress, if congress doe,s not act of ita
own Initiative at once," said Spreckles today
Treasury circular No. 6 Is addressed to tho
disbursing officers, as aro treasurers and desig
nated depositary bankB, and begins as follows:
"For tho purpose of bringing the ordinary
fiscal transactions of the fe.deral government
more nearly Into harmony with present, business
practices, It has been determined that tho dally
receipts ot Cho government shall be placed with
tho national bank depositaries to tho credit of
tho treasury of tho United States. Disburse
ments will bo made by warrant or chock drawn
on tho treasuror, but payable by national bank
depositaries, as well as by tho treasury and sub
treasuries." Then follow olovon paragraphs dealing In
minute details with tho manner in which checks
and other disbursements shall bo drawn and
paid, and pointing out that tho regulations do
not apply to postofllces or court funds deposited
in tho national bankB under prior statutes.
Tho following is an Associated Press dispatch:
Washington, Fob. 7. Secretary of tho Treasury
MacVeagh, In a letter tonight to Representative
Carter Glass of the house banking and currency
committee, which is investigating treasury order
No. 5, criticised on tho ground that It would re
sult in the accumulation of $200,000,000 a yoar
in gold in tho New York banks from customs
receipts, declared that tho new plan of handling
receipts and disbursements of tho government
did not Involve an Increase in the amount of
bank deposits to any appreciable extent.
"The increase will not exceed In tho aggre
gate two or three million dollars, If It reaches
that sum," wrote tho secretary.
Representative Glass called attention to an
attack on the now order by Rudolph Spreckles of
California, who charged that tho now order was
put Into effect to embarrass the coming demo
cratic administration. "It Is exceedingly doubt
ful whether a chango of this revolutionary char
acter In the business methods of tho troasury,"
said Mr. Glass, "should be put In effect In the
closing days of one administration to tho pos
sible embarrassmont of the succeeding adminis
tration. "I do not make the charge that this change
has been made with a view to embarrassing tho
next administration but Mr. Spreckles does make
tho charge and many persons will be ready to
take that view of the situation. It seems to mo
that alteration In the business methods of the
treasury department might well have been left
to the administration of Mr. Wilson and his
secretary of tho treasury."
After hearing from Secretary MacVoagh and
Assistant Secretary of the Treasury Bailey, Rep
resentative Glass stated that the treasury officials
did not take the view that the now order was
designed to or would embarrass tho administra
tion and ho expressed tho hope that they woro
"The only problem presented by tho new
plan," Secretary MacVeagh asserted, "Is that of
so directing and distributing tho daily treasury
receipts that thoy will moot tho disbursing
officers' checks in tho depository banks. To
accomplish this it has been necessary to reduce
the balances of a number of depositary banks
and to add depositary banks In each of the sub
treasury cities. Tho readjustment has resulted
in additional deposits being mado to tho extent
only of $350,000.
"Nearly three-fifths of tho government's pay
ments are required to be mado In Now York.
That tho government may have facilities to mako
these larger payments through the banks In 'New
York the increased balances in that city havo
been Increased to aggregate $2,088,000, dis
tributed among twenty-four banks, Tho total
increase in all sub-treasury cities aggregates
. $4,823,000. The total increase in all cities ag
gregate $6,065,000. Decreases havo been mado
to the extent of $5,715,000 in tho government
balances in banks where tho extent of the gov
ernment business does not justify larger balances
than have been left therein. This makes a net
increase, aB stated, of $330,000 in the bankB, tho
total amount in banks being $48,700,000 and
tho adjustments now are practically complete."
"Formerly tho sub-treasury has had to handlo
nine-tenths of the government checks eventu
ally," said Assistant Secretary Bailey. "Now 60
per cent of the disbursing is done by deposi
tories." Secretary Bailey thought tho treasury ought
to keep a working balance of not less than $25,
000,000 and that about $50,000,000 should be
kept in tho national banks to aid In handling
government business from day to day.
At present the government has a balanco of
about $90,000,000, with approximately $46,
000,000 in tho national banks.
senator from Delaware must bo accepted as a
fortunate escape from a situation fraught with
scandalous possibilities. Tho opposition from
four membors of tho loglslaturo, under circum
stances which aroused tho deepest distrust aa to
(ho moving cause, was apparently not based upoa
any very clear prlnclplo capablo of olucldatlon,
nor were tho men to whoso causo they were
ostensibly pledged of such toworlng ability or
lofty -statesmanship as to afford any plausible
reason for tho bolt. Tho deadlock thoroforo had
all tho nppenranco of those contests which
causod shnmo to tho stato when tho Addlcks fac
tion was In its heydcy, and Delaware is to bs
congratulated upon tho ending of tho turmoil.
Mr. Saulsbury has yet to provo In the largor
national field that ho can sustain tho traditions
created by Illustrious predecessors in his own
party from Delaware.
Tho Philadelphia Record says: Wlllard
Saulsbury conies from an old and distinguished
Delawaro family. Ho Is the son of tho lato
Wlllard Saulsbury, who was a former United
States senator and former chancollor, and Annio
Wllby Saulsbury, who died at her homo in Dovor
but a fow months ago. Tho now senator waa
born In Georgetown, "April 17, 18C1, and re
ceived his education at privato schools and at
tho university of Virginia. Ho started to prac
tice law In Wilmington in 1882, being associated
with Victor duPont, one of tho leading lawyora
of Wilmington, until tho tlmo of his death In
1888. He Is In active practice today and Is re
garded as one of tho most prominent attorney!
Although he has been In politics for yoars, ha
never has held a public position. Ho was chair
man of tho democratic county executive com
mltteo in 1892, serving until 1898; from 1900
to 1906 was chairman of tho democratic state
committee and was dolegato to tho domocratio
national convention In 1896, 1904 and 1912.
Ho was elocted a member of tho democratic
national committeo in 1908 and is tho present
member of that committee from Delaware. Ha
was tho domocratio caucus candidate for senator
In 1899, 1901, 1903, 1907 and 1911, which In
cluded the period of tho activity of J. Edward
Addlcks In Delawaro.
Last yoar Saulsbury mado his master political
stroke, when, by fighting tho nomination of
Cornelius P. Swain to bo United States marshal,
ho exposed tho corrupt practices of the republi
can machine of Delawaro and defeated tho conj
flrmatlon of Swain, President Taft withdrawing
tho appointment after tho testimony showing
corruption In Delawaro and Swain's connection
therewith had been taken hy a committee of th
Saulsbury has been active In tho businosa
affairs of Wilmington, having consolidated soma
years ago tho Wilmington City railway com
pany and tho electric lighting company. Ho la
a director and ono of tho founders of tho Equit
able guarantee, and trust company and of tha
Union National bank. Ho has been president
of tho Now Castle County Bar association, presi
dent of the Wilmington club, vlco president of
tho Country club and a member of many other
organizations. He was married In 1893 to Miss
May duPont, daughter of the late Victor duPont.
They havo no children.
Mr. Bryan's Selected Speeches. Revised and
arranged in a convenient two-volume edition.
These books present Mr. Bryan's most notable
addresses and orations, and cover tho chlof
important phases and features of his career as
an orator and advocate. A familiarly intimate
and interesting biographical introduction by
Mary Baird Bryan, his wifo, opens Volume I.
Tho two volumes, bound "In cloth, sent to any
address prepaid on receipt of price, $2.00. The
half leather edition, 2 vols., sent for $3.00,
prepaid. Address Tho Commoner, Lincoln, Neb.
SOMETHING ABOUT FIGHTING DEMOCRATS
Referring to Delaware's new democratic sena
tor, tho Philadelphia Public Ledger says: The
election of Willard Saulsbury to be United States
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