Postal Savings Bank
Performed by William H. Taft
Recorded August 5, 1908
The Republican platform recommends
the adoption of a postal savings bank system. The
government guarantee will bring out of hoarding places
much money which may be turned into wealth producing
capital and will be a great incentive for thrift in
the many small places in the country having now no
savings bank facilities which are reached by the post
office. It will bring to everyone however remote from
financial centers a place of perfect safety for deposit
with the interest returned. The pending bill for such
banks provides for the investment of the money deposited
in national banks and the various places in which
weve gathered or as near thereto as may be practicable.
This answers the criticism contained in the Democratic
platform that under the system the money gathered
in the country will be deposited in Wall Street banks.
The system of postal savings bank has been tried in
so many countries successfully that it cannot be regarded
longer as a new and untried experiment. The Democratic
platform recommends a tax upon the national banks
and upon such state banks as may come in, in the nature
of enforced insurance, to raise the guarantee funds
to pay the depositors of any bank which fails. The
proposition is to tax the honest and prudent banker
to make up for the dishonesty and imprudence of others.
No one can foresee the burden which under this system
would be imposed upon the sound and the conservative
bankers of the country by this obligation to make
good for the losses caused by the reckless, speculative
and dishonest men who would be unable to secure deposits
under such a system on the faith of the proposed insurance.
Because in its present shape, the proposal would remove
all safeguards against recklessness in banking
and in the end, probably the only benefit would accrue
to the speculator who would be delighted to enter
the banking business when it was certain that he could
enjoy any profits that would accrue, while the risk
would have to be assumed by his honest and hardworking
fellow. In short, the proposal is wholly impracticable
unless it is to be accompanied by a complete revolution
in our banking system with a supervision so close
as practically to create a government bank. If the
proposal were adopted exactly as the Democratic platform
suggests, it will bring the whole banking system of
the country down in ruin. And this proposal is itself
an excellent illustration of the fitness for national
control of a party, which will commit itself to a
scheme of this nature without the slightest sense
of responsibility for the practical operation of the
law proposed. The Democratic party announces its adhesion
to this plan and only recommends the tried system
of postal savings bank as an alternative if the new
experimental panacea is not available. The Republican
party prefers the postal savings bank as one tried
safe and known to be effective and as reaching many
more people now, without banking facilities, than
the new system proposed.