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Page:Popular Science Monthly Volume 49.djvu/225

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ter of Finance. Notes are a first charge against all the assets of the issuing bank, and there is a penalty for excessive issue. The shareholders are liable for double the amount of their stock. There must be monthly returns to the Minister of Finance, and there is a rigid system of inspection. To insure the stability of the entire bank-note issue, each bank is required to keep on deposit with the Minister of Finance a sum equal to five per cent of its circulation, as a contribution to the Bank Circulation Redemption Fund, held by the Government to make good the notes of suspended banks. A most noteworthy and beneficent feature of the system is the practice of branch banking, the thirty-eight Canadian banks having four hundred and sixty offices. By their means the banking facilities of circulation, deposit, and discount are given not only to communities of considerable population, as in the United States, but even to hamlets remote from commercial centers. The competition of the different banks throughout their various branches, each striving for as large a proportion of the note circulation as possible, together with the governmental restrictions upon overissue, insure to the millions of people inhabiting the Dominion a supply of currency, that at all times sufficient for their needs, expands and contracts as the demand for it rises and falls. The principle of branch banking places the available funds of the entire Dominion at the disposal of the communities needing them at the times of need, whereas in the United States, because of the narrow sphere of operation of each bank, there is frequently an overabundance of currency at one point, while the healthy exchange of effort is retarded at other points because of a deficiency. The "Baltimore plan" proposed in 1894 by the American Bankers' Association, and the bill introduced by the present national administration in Congress in December, 1894, were in their essential characteristics substantially similar to the Canadian banking law, and it was the opinion then expressed of most competent financiers, that the adoption of such an act would have relieved the country of the most crying evils of the present system, and have provided the foundation for a most wholesome currency hereafter. It is noteworthy that the provisions of the Canadian act were largely the outcome of the recommendation of the leading bankers of Canada called in conference by the Canadian Government, while financial authorities, among the highest in the United States, found members of both Houses of Congress deaf to their recommendations during the discussion of the administration measure, which was finally defeated by the votes of demagogues subserving selfish interests. It, however, goes without saying, that the province of true statesmanship is often not to persist in seeking the immediate attainment of an ideal when it is unquestionable that opposition makes that immediate attainment