Indianapolis Journal, Volume 48, Number 339, Indianapolis, Marion County, 5 December 1898 — Page 2

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depositors to bunks in the smaller communities of the United States would be so revolutionary as to bring about the most injurious conditions in the general business of the country.” The controller then fully discusses the claim that there Is an adherent moral right, irrespective of public policy, to gro.fer a note holder over a dei>osit holder in the distribution of the assets of an insolvent bank, and denies that such right exists. After reaching this conclusion the controller then asks: If, then, there is no inherent moral right to establish a preference of the note-holding creditors of an insolvent bank aa against the deposit-holding creditors in the distribution of the assets of an insolvent 1 unk, the question arises, does public policy demand. In the Interest of the common good, that such a preference should be given in order to establish a bank-note system which will give banks such a profit that to secure it they will relieve the United Btates treasury of the burden of gold redemption and afford tin- country a circulating medium having all< ged advantages over that now in use? He then states: "In order to determine this question, actual data at commend must 1 examined critically in ord< r to understand the nature and extent of the wrong done the depositor class hy this preference, and the consequent effects' of this wrong upon the community at large and itfl business.’’ WHKRK THE BURDEN F’ALLS. The e. utrolier then presents a series of tables which indicate more exactly upon what class of depositors the real burden of this pr f' i. nce will fail with nlmort crushing w ight. Tiles' tables' give, approximately, the loss which, under the proposed plans, would result to depositors from the preference of noteholders over deposit holders in case of insolvency, based upon the showing made by the 196 insolvent national banks whox* affair* have been finally closed during tim existence of the sjstcm. For the purpose of these tables it is assumed in the case of each class of insolvent banks that their officers would have made the same proportionate losses upon the commercial assets in which the noma issued wore Invested that they actually did upon the assets in which the deposits and capital of the banks were invested. To the good assets of those different classes of insolvent national honks, as shown hy the records of this ofii'-e. has been added the amount which would have been realized from the unsecured notes issued if loaned or invested with the same rate of loss as was made upon the money invested in the actual assets. From the assets thus in-ore.-is <1 there is subtracted 95 per cent, of the preferred note issues proposed (to wit, the par of the notes less the 5 per cent, redemption fund held by the government), which leaves the amount which would then go to the depositors and other unsecured creditors. This amount, in terms of percentage of their total claims, is then compared with the percentage of their claims actually received, and the loss which would be caused by the preference Is thus approximately disclosed in the difference. The tables give these results bettring upon tlie interests of depositors in banks according to geographical sections and according to the following classifications of capital: $50,000, JlOu.OOt), S2OO M*), pJO;000, $500,1100. and banks with a capital exceeding $500,000. These tables, which are elaborate and lengthy, show noteworthy results. For instance, they show that the depositors of 44 insolvent banks, having a combined capital of $9,122,000, nominal assets $24,153,212, and with cash dividends paid depositors of $7,9MJ)B3, or 71.01 per cent., situated in the middle States of Ohio. Indiana, Illinois, Michigan, Wisconsin, Minnesota, lowa, and Missouri, would have lost, by preference of the note holders with 100 per cent, issue, 39.70 per cent, more than under the present system, or 56.44 per cent, of their dividends; with an 7-0 per cent, note issue 3L76 per cent, mere, or 44.35 per cent, of their dividends; and with a 60 per cent, issue. 23.82 per cent, more, or 33.26 |>er cent, of their dividends.” HOW SECTIONS WOULu SUFFER. They also show that, as compared with the rate of loss to the New England depositor through the preference of the note holders in cases of insolvency, the issues of uncovered notes bring either 160 per cent., SO per cent, or 60 per cent, qfi the capital, the (depositor in the Eastern States will lose at a rate of nearly two and one-half times as great; the depositor in the Southern States at a rata nearly three times as great; the depositor in the Pacific States at a rate four times as great; the depositor in the middle States at a rate of over four and one-half times as great, and the almost obliterated depositor in the Western States at a rate over seven times as great. The controller then states that “from the tables which we have given it is evident that from the depositors in smaller national banks of from $50,000 to SIOO,OOO capital, and from the depositors ol' the nearer sections of the country, the greater amount of the cost of this radical experiment in currency must be collected. Thus upon those depositors least abie to endure loss must the heaviest losses fall.” He further states: "Those locations where deposits are the smallest, and therefore where there would be the greatest incentive to the taking out of increased circulation, are those where the depositors would suffer the most aevere losses, because of this unjust prior lien of noteholders upon the assets of insolvent banks. The measure will stimulate In still greater degree the tendency of tile money of the country to flow to the great money rcm: f s. where to fewer institutions, as time and competition progress, would pass the m. uidgeu.cn* and control o£ the savings and capital of the country. We cannot agree to tile wisdom of any measure which accelerates ti. centralization of capital in the ireat cities, and by separating in location hoso who lend from the many Who use money will encourage the growth of commerce only in the form which has tendency to crush out general business ndivldualism. "In the bank-note issues of foreign countries I‘n case of insolvency,” says the controller, "the noteholder would, it is understood, enjoy no preference over the deposit holder. They would share ratably in the assets. To give the credit whicn enables the notes of these great banks to circulate, restricted by stringent laws as they are, no injustice to depositors such as is proposed iti these plans for the United States fs necessary. In one country only. Canada, are the noteholders preferred over the depositors in case of Insolvency. The noteissuing banks of Canada are but thirtyeight in number, with a combined circulation of about $38,000,000.” The controller states that he cannot accept as safe any deductions drawn from the bank-note system of these few central institutions of eastern Canada which would tend to Justify the application of the laws governing that system to the 3,600 national banks of this country. SUMMARY OF* HIS VIEWS. The controller calls attention, as a summary of his views upon the proposed plans, to these propositions: “First—As a fundamental proposition, any bank-note system depending for security upon the commercial assets of banks and sanctioned by government should be inherently fair In its relation to the deposit-hold-ing creditors and the note-holding creditors of an insolvent bank. "Second No system Is Inherently fair which creates a preference of the noteholder over the deposit holder in the distribution of the assets of an insolvent bank. "Third—ln none of the older countries, to the success of whose uncovered note systems we are referred as tending to justify the experiment in this country is the noteholder by the law preferred over the deposit holder in case of insolvency of banks of issue. Canada, with its thirty-eight centml banks of issue, as compared with 3.6(H) scattered national banks in this country, furnishes the onlv exception to tills rule. "Fourth—The necessity of the preference under any such svstem in this country to give security and credit to the notes demonstrates thaMt is the depositors of the c6untry. and not the hanks, upon whom the great weight of the guarantee of the note Issue must fall. "Fifth A fairer system would provide that when a receiver took charge of an insolvent bank he should not first pay into the general redemption fund held by the government an amount derived from the assets of the bank sufficient to pay the noteholders ti full before paying anythtng to depositors, ut he should pay into the fund that pro rata share of the proceeds derived from the assets which should go to the noteholders, not as preferred creditors, but as creditors In the same class as depositors. The tax upon the solvent banks for the currency privilege should not, then, be limited to not exceeding 1 per cent, per annum of their annual note issue, or in any other amount, but should 1m- made sufficiently large to provide for the deficit, whatever it should prove to be. "riixth—lf under such a system, owing to causes to which we have referred, the tax upon the solvent banks would lie so large as to render the Issue of such currency unpiori’eblo and unattractive to the banks, it would be a demonstration of the radical difference in the environment and condition of our banking system as compared with the more centralized and older systems of Flurop?. It would'be a demonstration of the fact that under the propo-:*-'! legislation, while the banks would take the profits upon the circulation, the depositors would take the bulk of the losses. It would be a conclusive demonstration of what we believe to be the fact that, under our banking system us fit present organized, the absolute safety of notes secured only by commercial asset* and issued to the extent proponed in these plans can be secured only by resort to a grave injustice upon depositors, which cannot be Justified upon any grounds of public policy. ”F'*venth—Such a system of uncovered notes as this proposed, providing for a preference of noteholders ever other crcdA

ilors, would interfere radically with the more important functions of national banks to which the note issuing function is secondary and subordinate. This would he against public policy and would iperate against banking in the .•■mailer communities, and in the Western, Southern and -entral portions of our country. “Eighth—The government of the United States is not in such straits, in connection with its present currency system, as to compel it to enter into a plan of currency changes by which it in effect sells extended and valuable currency privileges to the national banks of the country in exchange lor assistance from them in fmeting its present governmental currency obligations payable in gold. “Ninth—ls the present conditions of governmental currency demand reforms, to secure which will entail cost, it is better for the government, as the representative of all the people, and under all the circumstances connected with our banking system, to pay an ascertained and exact cost direct than to endeavor ,o evade it by granting extensive currency privileges to banks which, of necessity, must reimburse themselves from the community and the depositor class for any cost which they incur in assuming the burden of gold redemption or maintaining the credit of their notes.” ELASTICITY. The controller then discusses the question of the elasticity needed in bank currency, commenting upon the great elasticity of the check and draft circulation of the country. In this connection, and as embodying his recommendations on this branch of his report, he says: “While in this country, -with its extended system of banks and its great development of the check and draft system, some degree of elasticity In bank-note issues is desirable, it is not essential that it should be an amount so large as to make necessary for its security an injustice upon the depositor, and thus, by interfering with the check and draft system, defeat one of its own prime objects. The general principles and regulations under which such elasticity might be obtained are not in any way inconsistent with the principles and arguments we have endeavored to set forth. As covering these general principles, and as a conclusion from the views hereinbefore expressed, the controller would make the following recommendations in regard to the present laws governing the issue of national bank notes: “First—The existing bank-note system based upon deposit of government bonds as security, should not now be abandoned. “Second—For the purpose of allowing elasticity to bank-note issues to protect the banks and the community in time of panic, a small amount of uncovered notes, in addition to the secured notes, should be authorized by law under the following limitations: They should be subjected to so heavy* a tax that they could not be issued in normal times for the purpose of profit, but would be available in times of emergency. The tax should be so large upon the solvent issuing banks as to provide a fund which, in connection with the pro rata share of the assets of an insolvent bank, would be sufficient to redeem the notes in full without necessitating any preference of noteholders over depositors of any insolvent issuing bank. The tax should be so large as to force this currency into retirement as soon as the emergency passes.” Such a currency could be used only to lessen the evil effects of the too rapid liquidation of credits which are collapsing under a financial panic, but could not be profitably used as a basis of business speculation and inflation. It should be to the business community what the clearing house certificates are to our cities in times of panic—a remedy for an emergency, not an instrument of current business. The controller, under the head of “Limita-' tlon of Loans,” urges an amendment to Section 5200 of the national banking law by which he will be given power to enforce a personal penalty for infractions of the law prohibiting excessive loans, something which the law does not at present give. He then recommends an amendment which will allow the banks of larger communities to have more nearly the privilege of loaning a given per cent, of their assets to one individual, which now belongs, under strict compliance with the present law, to the banks of the smaller communities. Referring to the violations of the present law, the controller says: “A United States court, under the general provision of the law providing for the forfeiture of the franchises of a bank for any violations of the banking act, might adjudicate the question of fact as to such violations, but could apply no other remedy than forfeiture of franchise. Since the institution of the national banking system the violation of this provision has been common; and the controller, though allowing no known violation to escape his written protest, finds great practical difficulty in his endeavors to enforce this requirement. On Sept. 10. 1898, the date of the last .call by the controller for statements of the condition of national banks, 1,124 banks, constituting nearly onethird of the entire number of banks in the system, reported loans in excess of the limit allowed by Section 5200, Revised Statutes ,of the United States.” RATIO OF RESOURCES.

The controller says: “The greater ratio borne by banking resources to banking capital in the larger communities, as compared with the like ratio in smaller communities, is responsible for the defective and unequal working of the present provision. The average ratio of resources to the average capital of the forty-seven national banks in the city of New York is as 18 is to 1; of tho seventeen national banks in Chicago as 10.2 is to 1; of the six national banks in St. Louis as 7.3 is to 1; v of the 257 national banks in other reserve cities as 6.6 is to 1; while in 3.255 country banks the ratio is but as 4.7 is to 1. “The law limiting loans to 10 per cent, of the capital, when applied to the 3,255 banks of the smaller communities of the country, as a whole, would allow the loaning of 2.14 lser cent, of their total assets to one individual. As compared with this, the banks of the city of New York, on the average, could not loan over fifty-six one-hundredths of 1 per cent, of their total assets to any one individual; the banks of Chicago not over ninety-eight one-humiredtbs per cent, of their total assets; the banks of St. Louis not over 1.4 per cent, of their total assets; the banks of other reserve cities not over 1.51 per cent, of their total assets. Iu other words, the proportion of their assets which the country bunks of the United States can loan, in strict compliance witli Section t>2oo, to one individual, is sixty-three one-hun-dredths of 1 per cent, greater than in 257 reserve cities, seventy-four one-hundredthsi of 1 per cent, greater than in St. Louis, over twice as great as in Chicago, and nearly four times as great as in the city of New York. This provision as it stands at present constitutes an incentive to the making of loans the larger in proportion to the total assets of banks in smaller communities,, where, ns a rule, large loans which are safe are the most difficult to secure; while in the larger business centers of the country, where commercial conditions create a certain demand both from banks and borrowers for large and safe loans, its effect is the reverse to such an extent as to be injurious.” He then says: “The habitual disregard of the present provision by the officers of so many banks interferes with the proper supervision of the banks by the controller, and tends to create indifference to the other restrictions of the national banking law. The failure of the present law to provide the power to apply a personal penalty for the making of excessive loans sometimes embarrasses the controller in endeavoring to check tendencies toward recklessness in loaning, which point to the ultimate ruin of a banking institution. As before stated, the present provision, when properly altered, should allow the hanks of larger communities to have more nearly the privilege of loaning a given per cent, of their total assets to one individual, which now belongs, under a strict compliance with the present provision, to the banks of the smaller communities. F'rom this privilege they are now debarred by law. CHANGF7S SUGGF7STED. “The desired results can be obtained, in our judgment, by adding, after the words, in Section 5200. ‘shall at no time exceed onetenth part of the capital stock of such association actually paid in.’ the following words: ‘Provided, That the restriction of this section as to the amount of total liabilities to any association, of any person, or of any company, corporation or firm for money borrowed, shall not apply where a loan in excess of one-tenth part of the capital stock shall be less than 2 per cent, of the total assets of said bank at the time of making said loan. Said loan shall be at all times protected by collateral security equal to or greater in value than the excess in the amount of said loan over one-tenth of the capital stock.’ “A strict and personal penalty enforceable by the controller should then be provided for infractions of the amended section by the officers of banks, to enable the controller to successfully enforce general and strict compliance with its terms. The suggested amendment will make Section 5200 just and equitable in its relations to all national banks, and to all communities of our country, lurge and small, which it is not at present. It would not lessen the amount which tiie smaller banks can now loan in compliance with the section Os It stands at present. At the same time it would not allow the larger banks to loan any one individual or corporation more than 10 per cent, of their capital, unless such loan. In addition to being secured for tiie excess, would still amount to a less per cent, of their total assets than the per cent, of total assets which' ihe smaller banks c-an now loan under the ectlon as It stands at p -esent. t Section 6290 thus amended will not interfere, us at present, with the right of the bunks in the larger cotatuunities to meet legitimate reauua-

THE INDIANAPOLIS JOURNAL, MONDAY, DECEMBER 5, 1898.

ments of business in these commercial centers. It will enable the controller, by its enforcement, to prevent an undue concentration of loans and conserve their general distribution. Under the section thus amended, the capital of a bank will be protected, inasmuch as no loan in excess of the 10 per cent, limit can then be made, except upon proper collateral security. The penalty clause will enable the controller not only to limit the size, but enforce the securing of excessive loans.” The controller then presents a series of tables showing the general effect of such an amendment upon the business of banks in its relation to existing loans. Under the head of insolvent banks the controller discusses in detail his ruling of May 8. 1898, reversing the former position of the office in refusing to revise an assessment against stockholders when an error in the first assessment became manifest. He states that in eight banks a revision of the first assessment has been made. In three cases he has made a second assessment against stockholders In the interest of depositors, and in five cases he will make returns to stockholders of sums illegally collected from them. He states that In the administration of insolvent banks in the interest of creditors he has effected annual savings approximating SIOO,COO. BANK EXAMINATIONS. The controller makes a statement in reference to bank examinations, as follows: "The appointment by the controller to these important positions of competent and able men is one of the most sacred duties of his office. To protect by every possible safeguard their independence and disinterestedness is equally important. With this latter object in view, the controller has forbidden the practice which he found in existence in some of the larger cities of the employment of the examiners by banks of their district in special examination work for the benefit of the bank, und not for the controller’s office. This practice had a tendency to interfere with the rigid impartiality which should characterize the work of a government official. "During the year the controller has extended over the cities of New York, Boston, Philadelphia and Baltimore the system of semi-annual visitations by examiners, in force in all other sections of the country. He has utilized, with some benefit, the examiners in investigations into the credit of heavy debtors of banks where such indebtedness constituted a menace to the safety of the banks, and where, despite the criticisms of the controller and the efforts of the bank officials, no material reductions in the amount of the indebtedness could be had.” I nder this head the controller, while recommending that domestic branch banking should be legalized in communities of less than 2,060 inhabitants, many of which are now unable to support independent hanks, opposes tiie granting of any more liberal privileges of branch banking than these, on grounds of public policy. He states that “such privileges would place the larger banks of the great cities in competition w ith the banks of smaller communities, and would probably result in a rapid centralization of the banking business of the country in the hands of a constantly lessening number of institutions. Theoretical advantages are claimed for such results, but in our judgment they would be injurious to the best interests of our country. Such a system would increase the difficulties in the way of the small borrower, though lessening them for the large borrower. It would tend to separate the borrower from the lender, as it would of necessity remove the central lending power from the small borrower of small communities. It may be claimed that the agents in charge of the branch banks youlil possess the same powers of loaning as the officers of the smaller banks now possess, but such arguments ignore the prevailing tendencies of modern corporate management which magnify of necessity central responsibility, and constantly tend to subordinate to rigid systems the activities and responsibilities of agents upon detached duty.” COLONIAL BRANCH BANKING.

In connection with this branch of his report the controller discusses at length the necessity for the establishment of international and intercolonial branch banking. He shows the disadvantages, as compared with foreign trade, under which American export and import trade now labors as a result of inferior banking facilities, and shows that these same disadvantages are a serious hindrance to the adjustment of our trade relations to the new advantages afforded by territorial expansion. In this connection he discusses the Hawaiian and Porto Rican banking and trade situations, lie says: “The foundation for the greater growth of trade between the United States and her colonies must be speedily and firmly laid in proper banking laws which will result in enabling her merchants to do business with the people of the colonies without the disadvantages existing at present. Our present national banking laws do not authorize the establishment of American international or American intercolonial banks, nor could any national bank establish a branch in a territory or colony such as Porto Rico or Hawaii, even if our present laws unchanged were extended over it. While it is questionable whether Congress Bhould legalize the establishing of foreign or colonial branches by national banks transacting business under the present law, that it should at least pass laws authorizing under proper restrictions the general incorporation of banks organized to carry on international and intercolonial banking, a3 distinguished from domestic banking, admits of no reasonable doubt. Unless some such legislation is provided the American exporter and importer in his trade with America’s colonies will be compelled to erdure all the disadvantages under which in all South American markets and in many other markets of the w'orld he now labors in his competition with foreigners enjoying superior hanking facilities.” His recommendations in connection with this branch of his report are made as fol“The determination of the relation of any new banking system to the existing banks and domestic credit of Porto Rico, differing as they do from those of this country, involves many difficult questions, and legal provisions for the appointment of a commission especially charged with the examination of the conditions of domestic banking and finance on the islands, and with the recommendation of the proper form of law in connection therewith, is respectfully urged upon Congress. “In view of the conditions and necessities of our trade with our new territories of Porto Rico and Hawaii and with other South American countries, as well as with those other territories over which our country must exercise a more or less extended measure of control, the controller earnestly recommends the passage of laws authorizing the incorporation of banks organized for the purpose of carrying on international and intercolonial branch banking.” The controller states that "up to and including Oct. 31. 1898, there have been organized 5,151 national banks, 23 per cent, of which have been placed in voluntary liquidation and less than 7 per cent, in the charge of receivers. At the close of the year there were in active operation 3,598 associations, with authorized capital stock of $621,552,195. The outstanding circulating notes of the banks on that date amounted to $239,546,281, of which $210,045,456 were secured by bonds and the remainder, $29,500,825, by lawful money on deposit with the treasurer of the United States for the account of liquidating and insolvent banks and those reducing circulation. The circulating notes outstanding are $9,582,771 in excess of the amount bn Oct. 31, 1597. During the year there were organized fifty-six banks, with total capital s{ock of $9,665,000. The number of banks leaving the system during the year by voluntary liquidation was sixty-nine, one of which was subsequently placed in the charge of a receiver. The capital of the sixty-eight banks which liquidated amounted to $12,509,000, and the circulation to $2,184,958. The combined capital of the seven insolvent banks was $1,200,000.” The controller is required by law to publish In his annual report statistics relative to banks chartered and ope rated under state authority. He states that “the returns from institutions of this character to the number of 5.145 have been received; and. in addition, statements from 758 private banks and bankers. The aggregate resources of these institutions amount to $4,631,328,357; loans and discounts, $2,480,874,360: capital stock. $370.073.788. and deposits, $3,664,797,290. The total banking funds of national banks, as shown by reports on July 14. 1898 and other banks at date of latest returns, amo-mt to $7,410 355.568, an increase since 1597 of $594,028,698.” Kansas Romance. Atchison Globe. An Atchison young man dared not ask a certain girl to marry him some five years ago, as he was poor and without prospects. He went out into the world ("world’’ stands for Kansas City), won fortune and fame (a $45 job in a counting house, and sang tenor In a choir), and returned last week to claim her. He found that in the five years that had elapsed she had grown five years older, and decided that she was too old for him, and went back without her. The Municipal Conference. Philadelphia Record. The practical effect of the conference has been to elicit the expression of many ideas •hat will bear fruit hereafter. The mora’ effect may be as wholesome in impressing the country with the truth that there are questions of municipal rule remaining to fit. settled that are as worthy of thought and discussion as any connected with the Philippines. Vote flutist upright piauoa at Wuischr*.r’e.

TRUST ARTICLES READY SCHOOL FURNITURE COMBINATION ALMOST PERFECTED. Wabash Concern in the Deal—Stark* County's Courthouse—Verdicts in Monroe City Blot Case*. ♦ Sneeial to the Indianapolis Journal. WABASFI, Ind., Dec. 4.—The stockholders of the new company to be formed, with a capital of $6,000,000, to take over the school furniture manufactories of the country, thirty-eight in number, will hold their meeting to perfect the organization in New York Dee. 5. All the preliminaries of the organization have been completed, the articles of association having been finished to-night ready for the signatures of the shareholders. It ia practically settled that twelve or thirteen of the thirty-eight concerns, including that in this city, which ranks fifth in production, will be kept steadily in operation, and the others will run only as the market warrants. The purpose of incorporating all the companies in one association is to prevent the ruinous competition for work, and by concentration reduce operating expenses. James Lynn, of the Wabash Church and School F'urniture Company, is one of the originators of the scheme, having begun work on it two years ago, when the purpose was to take in only a few factories. Now every important concern in the country is included. Abundant capital has been provided, and in the sale of the local plants the owners will, including the raw material and finished product on. hand, reee’ve $2 in money and $1 in stock on the basis of the appraisement of the property. The capacity of the Wabash factory is to be doubled immediately. * EPHRAIM KEIGWIN DYING. Iloosier Gretna Green ’Squire Who lias Married 9,000 Couples. LOLTSVTLLE, Dec. 4. —The Courier-Jour-nal says: Unless a change takes place in the condition of Ephraim Keigwin, the “little ’squire” of Jeffersonville, who has joined the destinies of 9,000 couples, most of them elopers from Kentucky, death will end the sixty-seven years of his life, mostxof which have been spent in the Hoosier Gretna Green, where he has always been a character, with an acquaintance extending into nearly every State in the Union, He is suffering from cystitis, and last night his physician, Dr. C. F. C. Hancock, said that an operation would be necessary, and that a fatal termination was a probability. ’Squire Keigwin has been sick for about a week, but not until yesterday did serious symptoms! manifest themselves. He suffers severely, but is conscious and hopeful. In 1877 he was elected magistrate, and he has continuously served in that capacity, having performed marriage ceremonies for judges of the Supreme Court, superintendents of public instruction, judges, sheriffs, clerks, treasurers, auditors, merchants, mechanicsand even preachers. He has been paid fees ranging from five cents to SSO. Several ceremonies were always at his tongue’s end, the occasion regulating the form that wedded the couples for better or worse. The ’squire has prided himself that he was a matrimonial mascot. The “little ’squire” was in the days of ’49 a California gold-seeker. He tramped the plains and next followed the federal troops, taking photographs of the soldiers. Afterward he kept a drug store at the corner of Market and Spring streets, in Jeffersonville, and once upon a time operated a farm. Not long ago he related to a reporter his experience as A gold hunter. He had been attending the university at Bloomington, Ind., and hastily concluded to join a party bound for the plains. He at length reached Shasta City, and seven miles: from there bulit a cabin of saplings and canvas. "Pay dirt” was found. F'or a while he made sl7 a day, but the solitary surroundings caused him to pull up stakes. Not fax away was a camp of Digger Indians. He met a maiden, won her heart, gave the chief of the tribe a bright red blanket, and thus became the liege lord of the damsel. The blessing of the chief made the young gold hunter and the dusky beauty “husband and wife.” Weeks went by. The gold hunter wanted to return to civilization, and. one morning he presented the girl with a pair of blankets, several trinkets that looked valuable to her, and was oft’ for San F'rancisco. In that city he laid brick for sl4 a day, added to his store of gold, became homesick and after two years returned to his old home and opened a picture gallery, and when the war broke out he shouldered his camara. He always delighted in telling the story of how he happened to quit farm life. A. black cat crossed his path and bad luck soemed to follow from that time. One day he sold some land for $1,500. He placed the money in his vest and hung the garment on, the fence. It w’as in harvest time, and a fire started on a field. It quickly spread, and fence, vest and money went up in smoke. Other misfortunes followed rapidly, but illfate never soured the jovial little man, and adversity found him as cheerful as prosperity left him. He married sisters, and his second wife, who was Josephine Morgan, still survives with one son, James ktigwin, who is a clerk in the office of the Louisville & Nashville Railroad Company. ’Squire Keigwin was born Dec. 14. 1831, in Jeffersonville. His father was William Keigwin who was a prominent man, and who died April 30. 1861. Colonel James Keigwin, of this city, is a brother of ’Squire Keigwin. Mrs. Rebecca Merriweather, of Jeffersonville, is a sister. / .. A—.

KNOX COURTHOUSE. Starke County's New Iluildlng;, All Complete, Costs $120,006; Special to the Indianapolis Journal. KNOX, Ind., Dec, 4.-Starke county’s fine new courthouse was accepted from the contractors Saturday by the Board of County Commissioners. This is perhaps one of the finest courthouses in the State outside of the larger cities. The contract for the construction of this building was let April 24, 1897, to Caldwell & Drake, of Columbus, Ind., Wing & Mahurin, of Fort Wayne, furnishing tiie architectural work. Previous to the letting of the contract the board of comhiissioners, two of them being Republicans, in company witli the architects, visited several courthouses of recent construction. Tiie contract price for the building was $57,000, but the foundation was changed from concrete to stone, the zinc roof was changed to tiling and many other important and useful changes being made, which run up the price for the building, with furniture, water works and sewerage, graded yard and cement sidewalks, to $120, 000. Ground was broken on May 10. 1897. and on July 4 the cornerstone was laid. The board of commissioners is composed of W. T. Collins. Democrat; William Miller and Fred E. Vergin, Republicans. with Auditor August H. Knassman. Democrat. Mr. Collins, though a Democrat, worked with the majority and is in hearty accord with the entire proceedings. Starke county has a bright future before her. and with her splendid courthouse as a starter, it is believed she will show rapid and sound development. * MONROE CITY RIOT CASE. Four of the Defendant* Fined SIOO Each and Four Acquitted. Special to the Indianapolis Journal. VINCENNES. Ind., Dec. 4—The famous Monroe City riot case was concluded to-day at 9 o’clock by the Jury returning a verdict assessing a tine of SIOO each against Jacob Tucker, John Bell, Constable Joseph Barnett and Jacob O. Hicks, and acquitting Dennis P. Coonrod, James Coonrod, William Edwards and W. H. Harrison. On July 23 the above named defendants, it was alleged, went to the home of John Silence, colored, headed by Constable Joseph liarn'itt, and tried to eject the colored family from the place, which was owned by L>. P. Coonrod, without a warrant or notice by law. In tiie effort to make the colored people leave over sixty shots were tired, Barnett being Hit hy a bullet and John Silence, colored, fatally wounded, from which, it is alleged, he subsequently died. Thu house was also burned. 'l ow UNliip Libra ries. Cannelton Enquirer. Tiie Legislature will be asked to amend the laws establishing township libraries. The best way to amend it is to wipe it off the books. The township library is a mistaken idea. ’The average township is so large tliat a library cannot be so located as to be of service to the entire township. Take Troy township, for instance. Wo have

a Troy township library. Who knows where it is? Who cares? What books are in this library? If it is located in Tell City, what use is it to Cannelton or Troy, or the township at large? At one time it was stored in Cannelton, and we don't suppose three people in town knew where it was. At that time there was not a half dozen books of value in it. There were many standard sets from which half the volumes were gone, and many ponderous works fifty years out of date. Like Chambers's Encyclopedia, it had the latest news about the Roman wars. At that time $lO a year was paid for taking care of the library, and the whole library was not worth $lO. The best thing to do is to order all the old books to be sold at auction for what they will bring, and stop the expense of taking care of the musty stuff. To be of use the library must be close at hand; in the towns and in the school districts. Avery few volumes in each school house will be of more use to the pupils than hundreds at some remote point in the township. Want Temperance Law Chaugnl. Special to the Indianapolis Journal. KOKOMO. Ind., Dec. 4.—This week South Kokomo will have four saloons. For years this part of the city has been without a legalized drinking place. Quart houses and clubs, however, took the place of retail saloons, and became such a nuisance that the people are gladly going back to the latter, which they consider a less evil than the former. Remonstrances under the Nicholson iaw were put in circulation early in the week against two applicants, but the ladies in charge met with such poor encouragement that they retired at the end of two days, thoroughly disheartened and discouraged. The licenses will be granted by the commissioners next week. There is a sentiment here in favor of changing the temperance law, making the applicant for license do the canvassing for signatures instead of requiring the opponents to remonstrate. It is regarded as a useless burden on the people to secure the signatures of a majority of voters at each session of the Commissioners’ Court, which must be done to defeat the applicant. It is argued that if this burden was thrown on the applicant (to get the names of a majority of the voters of the w’ard on his petition for license) there would be few petitioners for saloons. Buried with Military llonom. Special to the Indianapolis Journal. GREENCASTLE, ind., Dec. 4.—There was an imposing military funeral here to-day. Earl Fish, a member of Company I, of the One-hundred-and-fifty-ninth Indiana Regiment, died of typhoid fever during the summer and was buried at Arlington Cemetery, near Washington. This week Dr. Eugene Hawkins, of this city, one of the surgeons of the regiment, w r as sent by the parents of the dead boy to Washington to bring his remains to this city for burial. They arrived yesterday, and to-day services were held at the Christian Church. Rev. W. K. Weaver, chaplain of the One-hundred-and-tifty-ninth, officiated, and was assisted by Rev. O. A. Stuart, of the church. The remains were taken to the cemetery at Birch Chapel, six miles north of the city, and given a military burial by Company I, flfty members of which were present. Municipal Ownership. Special to the Indianapolis Journal. HARTFORD CITY, Ind., Dec. 4.-This city owns its own water works system, and the question of municipal ownership of the electric-light plant is now before the Council. Friday night committees were appointed to open negotiations with the electric-light concern and to investigate the plant. There is some question whether it would be more profitable to purchase the old plant or for the city to construct anew one. The city is under contract to pay the electric-light company at least $3,000 a year for the next six years. Deaths at Muucie. Special to the Indianapolis Journal. MUNCIE, Ind., Dec. 4.—The death of Mrs. Carleton E. Shipley, aged sixty-seven, occurred last night from pneumonia after a week’s illness. Her husband is the oldest member of the Delaware county bar. The husband and three children survive the deceased. \ Mrs. Lena Boehm, daughter of Joseph Hummel, died yesterday at the age of fortythree years. Forty-Eight Years in One Pulpit. Special to the Indianapolis Journal. GOSHEN, Itid., Dec. 4.—Dr. H. I*. Vannuys to-day preached his forty-sixth anniversary sermon as pastor of the First Presbyterian Church, this city. He was the church's first pastor, and this was his first and only pastorate. He has served his church longer than any other pastor now living in Indiana.

Indiana Note*. Muncie Lodge of Elks, No. 245, observed Elks’ memorial day in their elegant new home. Judge Ballard, of Anderson, made the address, assisted by Rev. Anna Brennan. Presiding Elder M. S. Marble, Kokomo, dedicated a fine new Methodist Church at Onward, Cass county, Saturday. The thrifty congregation has provided for the debt. Hon. John W. Kern, of Indianapolis, deliveied the Elks’ memorial address at Ko* komo last evening before a large audience. The morning service was conducted by itev. W. A. Poster. Mrs. David Cammack, one of Muneie's best-know women, fell into a cellar Saturday night. A large gash was cut in her head, her left hip and knee were badly injured, and a bone was broken in the letft shoulder. It is feared there are internal injuries may prove serious. PENSIONS FOR OLI> PEOPLE. A New Zealand Plan to Proteet the Aged Poor. Christian Advocate. One of the most pitiful sights which sometimes forces itself upon the notice of people living in large cities and occasionally even in small towns, is the effort of feeble old men and old women to secure a living by work or alms. As people grow old the thought of ending their days In the poorhouse becomes more and more repugnant, and to many it becomes a terror which haunts them day and night. To escape it they would gladly do any kind of work, and when unable to secure It or to perforin it, they would willingly die. But men and women are not necessarily past their usefulness to society when they become too old to work. The radiance of their beautiful characters is often a greater moral blessing than the wealth thev may have been able to add to the common fund in the vigor of their youth and middle age. The sweetness of character which makes the writings of the Apostle John the most comforting, most precious of all the writings of the Scriptures, was the fruit of old age. What would the world and our homes and the church be without old people? Blessings be upon them! Shall thev be left to die w ithout care or help, or be sent to the poorhouse when they become too weak to help themselves? Society is' beginning to ask this question. How shall it be answered? New Zealand proposes to answer it by providing a pension sufficient to keep its old people from want. It assumes that by their labor, whether in the home, the field or the factory, they have served the state as faithfully as the soldiers who fight its battles, and when they can no longer support themselves, it is the duty of the state to provide for them. Recently the House of Representatives adopted a bill providing for a pension of £lB per annum, or S9O, for every person over sixty-five years of age, whose yearly income does not exceed £34, provided be or she has resided in the colony for twenty-five years. The bill must yet pass the upper house. If it becomes a law it is expected to affect about 6,500 persons the first year and involve an expenditure of about half a million dollars annually. A similar bill was adopted in the New Zealand House of Representatives several >ears ago. but it W'as defeated in the upper house, because it provided a pension for every person sixty-five years and over, regardless of their financial income or need. This was thought to be too socialistic and would turn the colony into a huge friendly society. The new bill provides only for the aged poor, but it protect’s them from that which they so much dread—the noorhouse. The experiment will be watched* with interest. If It proves to he successful, it will no doubt be adopted In some form by other countries. A Bachelor’* Observation*. New York Commercial Advertiser. A needle is a peculiar article. If the eve is large enough to allow' the thread to enter it with any facility, the needle seems singularly and disproportionately large after it is threaded. The spool lives a life of usefulness. It holds the thread and pushes the needle through things it is inclined to stick in. The toe of a shoe answers the same purpose as a wooden egg in darning socks. Persons who use the toe of a shoe generally put in darns that will outlast any sock: the darns do not. however, as they say in Virginia, “pretty” much. Intcllliirciit Jury. New York Commercial Advertiser. It is a remarkable Jury which is trying Mrs. Cody for blackmail of the Goulds. All but one of the jutymen swore that they had never before heard of the Gould*,

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LOCAL GOVERNMENT REFORM. A Suggestion for a Substitute for Board* of County foiumii*lonfr*. To the Editor of the Indianapolis Journal: The Republican party, by Us platform, stands pledged to reform our county and township governments. It is gratifying to know that the leaders of the party aie already manifesting a determination to keep that pledge. The plan for the government of these subdivisions cf the Slate was adopted long years ago, at a time when coonskins were legal tender and when the pioneer settlers were devoting their days to felling trees and their nights to burning log heaps. This region was then thinly populated, and it would seem that the system was devised for the special purpose of causing the people as little concern as possible. Like all political expedients, it is full of inherent evils. Asa result of the system there is scarcely a county or a township in the State that has not been scandalized by official corruption. The reformation of these governments lias been too long delayed, and now that the work is about to be undertaken it is of the utmost importance that it should be well done and that the scheme now adopted should bo in line with the best thought of the age. When an exhaustive analysis has been made it will be found that the system is best w'hlch offers the fullest opportunity for the development of the individual. How to govern a great extent of territory without encroaching upon the freedom of the individual has been the political problem of the ages. Greece sacrificed union to liberty. Rome sacrificed liberty to union. In both cases th£ result was disastrous. The authors of the federal Constitution overcame tile difficulty by placing every citizen of this Nation under a dual government. The federal government within its proper sphere is made supreme. The state government within its proper sphere is also supreme. This is said to be the greatest piece of constructive statesmanship the world has ever known. It made it possible for Webster to proclaim, “Liberty and Union, now and forever, one and inseparable.” I believe that the attention of the people generally is given to national affairs to such an extent that local government suffers from neglect. This condition, if continued, will react disastrously upon the federal government itself and ultimately result in political stagnation and decay. The federal structure is best supported when it rests' on the shoulders of strong men and women wfio are accustomed to manage well their home affairs. Such changes, therefore, should be brought about as will place the local government more directly in the hands of the people and permit a more general participation by the taxpayers themselves in the actual management of township and county affairs. When the Massachusetts convention was deliberating upon the federal Constitution, which had been submitted to it for adopt tion or rejection, that section which authorized Congress to establish a homo for the national government, and for that purpose to exercise exclusive control over a tract of land not exceeding ten miles square, was pointed out as a source of danger. The idea of setting aside one hundred square miles of territory over which Congress might wreak its tyranny was appalling. One delegate gravely announced that if this district were reduced to one square mile he might withdraw his objections to the Constitution. Contrast the condition of mind which then prevailed among our New England forefathers who knew the value of self-government with the mental stupidity displayed by us in the matter of local government. The county in which i live (Elkhart) has an area of nearly live hundred square miles, includes two cities, live incorporated towns and sixteen townships, and has a total population of more than fifty thousand. And yet the entire business interests of this county are in the hands of three men. Could absurdity go further? If any two of them see fit to combine against the third then the tw T o have unbounded sway. They make all contracts, allow all claims, fix the tax rate and disburse the This vast volume of business is done in obscurity and with a rapidity that is astonishing. There is no time for thought, discussion or enlightenment. They can transact the public business in a cellar or in a garret with equal facility and the taxpayers be none the wiser. The county is a public corporation; the commissioners constitute its board of directors. What private corporation would be content to intrust a business of such magnitude in the hands of three directors only? Asa board of directors it is their province to manage the business interests of the county, but in addition to this they also, for certain purposes, constitute a court. They act in a double capacity. Asa court they must pass upon questions of law, conduct trials, hear and determine cases. It is well known that the average board of commissioners is not qualified to discharge the functions of a court. But few commissioners have any knowledge of the law, and know but little about demurrers, answers, judgments and the rules of evidence. Ho.v are they enabled to perform their duties as judges? It is done by substitute, by proxy. They employ a lawyer, who is generally styled “the county attorney.” By reasojl of his knowledge of the law he virtually becomes tiie court and the commissioners become his servants. This fact is all the more astonishing when we remember that there is no such officer as county attorney known to the law. Neither the Constitution nor the Legislature has provided for such an agent. The evils pertaining to county government cannot be remedied by any method for the making of contracts, allowing claims and auditing accounts that the Legislature may prescribe. The disease lies deeper than any mere defect in procedure. There is too much seclusion and exclusiveness in the conduct of public business. Too much of it is clone behind closed doors and drawn curtains. The cure can lie found only in a system that will bring everything into the sunlight—a system that will lead to deliberation and discussion, and any government other than government by free, full and fair discussion is tyranny. To attain this result the board of commissioners should be superseded by a county council composed of representatives from every township. It should be a legislative body pure and simple, and all judicial power should be transferred to the circuit court, where it belongs. We have drifted too far away from the principle so clear to the hearts of Englishspeaking people and which has given them their proud iwsition in the world’s affairs. We must return to the principle of home rule and perfect a government of the people, by the people arul for the people. To be a skillful performer on the piano one must have constant practice at the keyboard. Likewise, if w r e are to be a nation of governing citizens we must have actual experience in the art of self-government. We cannot at this time too greatly magnify the importance of local self-government, it is the saving principle of our Republic. It is the fountain of youth. It supplies the means by w'hich a nation may la; perpetually renewed. The nation that drinks of its pure water can no more grow old than humanity can grow' old. The nation that will not suffer this fountain to be polluted can only perish when humanity shall perish. The fact that a people are vigilant and exacting in their local affairs is the most hopeful indication of future security. To the average citizen home rule is vastly more important than federal control. The county courthouse is near at hand; Washington is far away. If township, town, city, county and state governments are guided by wisdom, prudence and economy the people can withstand an enormous amount of federal mismanagement. Our system of township government is even worse than county, it would not seem so much out of place in France or Spain but in America it is simply alxmiinable. But I w’ill not take more of your space than simply to say that towns and cities should be absolutely separated from the civil townships in which they are located. Tiie townships should then be governed by the oldfashioned town meetings, in which every freeman should have a voice and a vote, if our local governments could be reformed along tiie line herein indicated progress would take the piuce of stagnation, lndlam placed at the forefront of States, and a eiti-

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zenship established that the social and political storms of the world could not shake. E. A. DAUSMAN. Goshen, Ind., Dec. L , Going; Out of Politic*. To the Editor of the Indianapolis Journal: A few days ago I took occasion to quota from the New York Voice, the national organ of the Prohibition party, several declarations to the effect that as a temperance movement the party had proved entire failure, and that something else should now? be tried, intimating that later on it would suggest the wiser policy. It has not yet done this, but the action of the national Woman’s Christian Temperance Union at St. Paul is even more significant than the words of the Voice. To fully appreciate this action it must be remembered that Miss Willard in her last official address to the Woman’s Christian Temperance Union called attention to the comparative inefficiency of the union in temperance work of late years, adding that the supreme duty of the hour in the temperance field was the reformation of drunkards and the inculcation of habits of total abstinence. She did not recoiqmend in direct words the abandonment of politics, but that the union so understood her is manifest from the action of the St. Paul convention. Mrs. Luella F. Me Whir ter, of Indiana, offered the following resolution: “Resolved, That we pledge our moral influence and support to that party, by whatever name called, which shall seem as the best embodiment of the prohibition of the liquor traffic.” The motion was seconded, the previous question was moved, and, without giving the introducer of the resolution an opportunity to make the closing remarks, the resolution was voted down. In connection with this action of the convention the fact that it adopted a resolution urging the practice of total abstinence clearly shows that instead of longer wasting their strength on politics they intend to accent Miss Willard’s advice and go out of politics and into the temperance work. No definite plan w’as formulated because the momentum of its late political trend was too great to be checked at once. It adopted a few harmless resolutions relating to education, good wages, arbitrating international disputes, and one which insists that men ought to be virtuous as well as women, and adjourned to meet at Beattie next year. The action on Mrs. McWhirter's resolution is, however, only negative; it does not wholly dissolve the union’s connection with the Prohibition party, it merely means they do not care to “renew their vows” Just now. U. L. SEE. Indianapolis, Dec. 3.

Enactment* Concerning Reform*. To the Editor of the Indianapolis Journal: No doubt the management and control of county and township uffairs sadly need reform in some manner and in some cases, but the Legislature should be cautious tti this direction. The masses of the people are very much averse to increasing the number of office holders of Indiana, especially if it Increase expenditures. They prefer the number be curtailed rather than multiplied. Neither do they w’ant enactments .which will complicate and mystify matters. They prefer simplification if public interests can be subserved thereby. Besides reform in county and township affairs there should be some reform* in the judiciary of the State. There are entirely too many circuits. The number should be abridged. There are circuit judges who are not required to hold court in their own circuits more than from twelve to fourteen weeks per annum, and there are many who can transact all tho business of their circuits in from fifteen to twenty weeks per year if they would be as industrious a# other salaried people. The number of circuits In Indiana can be very materially reduced without detriment to the public and thousands of dollars annually saved to the taxpayers of the State in that direction. Suppose those seeking needed reforms in other directions look a little in that direction also. G. W. S. Corydon, Ind., Dec. 3. Threw Honolulu lleautlen Coining. Washington Special. An interesting addition to Washington society this w inter will be the tiiree Misses Ah Fong, the unmarried daughters of a Chinese mibionaire of Honolulu, who have just finished their education and desire to enjoy the advantages of a winter at the capital. They have two sisters married in the United States. One is the wife of Captain Whiting, of the United States navy, now commanding the monitor Monadnock at Manila. The other is the wife of William A. Henshili, a San Francisco lawyer, and they will be chaperoned here by Mrs. Humphrey, a third slHter, the wife of an American planter and banker at Honolulu. Their father. Ah Fong, is in many respects the most notable; man in Hawaii. He was a common cooly when ho came to Honolulu, but he has had the enterprise and business ability to make an enormous fortune, so that he is said to be able to give $1,000,000 to each of his seven daughters. Their mother was the daughter of a roving Portuguese sailor and a native Kanaka woman, so that they represent a curious mixture or blood; but the ladles are highly educated and are said to be possessed of many personal attractions. Their ancestry is not n.nre fixed than that of the wife of Hubert Vos. the artist, who was Mrs. Graham, considered the most famous beauty in the Hawaiian islands. Her grandfather was an Irish castaway named Cooney, who married a Chinese woman. Their son. Mr. Cooney, jr., married a Kanaka, and Mrs. Vos is on® of the several ejiildrern, wl o are remarkable for their fine looks. Mr. Cooney sr.. vas an ordinary plantation hand, but his son became superintendent and afterwards owner of one of*the finest properties in ths Hawaiian islands. The River Steamer's ••Texas.” Jeffersonville (Ind.) News. Very few people know why the quarters for the crew' on a steamboat is called the Texas. A retired river man explained it as follows; 'Flie rooms on the boats in the early day's were named after the different States, but afterward, about 1840. the new boats were enlarged by the building of the officers’ cabin under the pilot house, and ths limited number of names necessitated another change, and the apartments were called ’•staterooms.” Texas at that time had not been admitted to the Union, and it was decided to call the new addition to the boats the ’’Texas.” Roosevelt and Whittier. Chicago News. Rooseveit, snow-bound on his way to Boston, made SI,OOO by writing an article for a magazine. It Is doubtful whether even Whittier made more out of his ’’SnowBound”—as respects money, at least. !iut Pachydermatous l£uou(fh. Baltimore Herald. Emperor WilMam should get the court physicians to try' a little skin grafting on him. lie is altogether too sensitive about remarks raudo by iconoclastic subjects.