MR. LONGDILL AND CURRENCY REFORM.

Dominion, Volume 2, Issue 619, 23 September 1909, Page 4

MR. LONGDILL AND CURRENCY REFORM.

! Sir,—On several occasions arid in. different nowspapors Mr. longdill lins said nice things about mo in connection with banking reform. He, however, tones it all dotvn by a regretful remark or two anent my , want of sound banking ideas, and my griovous heresy in advocating an jssuo of paper.'cur,roncy. -These heresies (according to Mr. Longdill's • views) I niu further publishing iii- a pamphlet covering a lecture 'delivered by, myself in Wangariiii last June, and when it is in circulation tlio public. will, .bo able to judge of its merits. I admire Mr. Hogg's pluck and vigour, but so far can only discern an .' attempt onliis part to .adapt thd Canadian noto lssno 'system ;to New . Zealand requttements. Mr. Hogg therefore romains a'"gold standard" man his currency system notwithstanding.. . llio great difficulty about currency and banking reformers in New Zealand arises from two i fundamental facts.. -First, the gentlemen -who are engaged in tlie propaganda nro not trained ' bankers; indeed, havo never even" put a ; hand . to a single Staking operation from , the inside : °f a bank, .tho'consequencG .following is a Want of dpfiniteness of. ; technical, oxpi'ossion—a..want too of-.p.ractica.l ktiowledgb.'; Tlio, second troUblo aliout theso,' matters Comes 'from 1 confusing 'and ; treating as ono two separate and ; distinct 'fpnc* ' tions;''viis;,"''ba(ikiiig and r'curroiicy. We can have bankipg without a State cnrrcncy. 'We have that .now," arid .very, bad, :it? is iridecd-for .the dominion. ,'■ Wo could 'havo 'a Stato, cur-, rency .wifliout, any banks at all. ' Banking; and ; currency are .separate and. : State bankers.and'paper issue men fail in confusing. tho two:,' r." ■ ," " . Mr. jlidrigdill ip' your-issuo.' confuses : matters : ns,.above.:' He then'finishes by claiming to.be the,-"first-man,in the world" to "propound a;scientifie banking system," and I think )infc'rs;.tnis' carries with it a-new. currency•sysite'm.'.':l; riiust ; crat'o his.'pardbmif I. do.,iiot ; quite, grnsjji his. scheme,which/ is 'necessarily jcorideiised in .his short, letter.; : hlit. in so far as ,1-eaiufollow him. regarding banlcing,. I. may i say. thfi .systemj of bank* credits; which ho ; 6uti lilies is ; very .much the same! as'.'obtained for lover .400' years in tho fearik of Veftice, founded early, in 1 tho "twHfth" century. "The credits in the_ Bimk of . Venice had , their origin in de;posits;'of foreign coin Made' by tho great merchants, of ;Venice.\ "Wliut' suited the requirementsof siicli niafm&te's came' to liti 'end when ■Napoleon I. took.tbft ; cityi Tho .Frouch found ■rio funds in' tho'Mnk'to hiako a prize. Venice :hnd"her bank: prospered greatly, under...tho ■bank cr'cdit .''system -of .'the day.' Mr. long-, dill's. '"Bank/credit!', is ,riiuch.'the some, ; :oniy 'in place .'of, foreign coins' boing'.'deposited.. and. jformingith'e .basis 'of "money , of account," jwhich is the 1 i;erm thn.;Yenetians applied to their "bank '(y'edits.", Mr...l;origdliill .claims a jbank 'should, bo fprmcd which could debit 'and ■credit. customers'., as instructed, with "abstract [quantities of. labour," or' "what is: commonly ;calle'd' Value." ,In my opinion this idea is |f|uito.'unworknbl(!.'.*bec(mse>New 'Zealand iff not in , tho'.-no^itiOn'.ttat.'jVcnice .once ■ held—-tho commercial arid financial,'centre of tho world. Wft' - are: hot; collecting much 'from ; foreign trade. * !-Wp are a most primitive community; just exporting 'a. : very .few .raw- products which Ircquirq the', least, amount of bfiiins and indnsrry;to:bring forth; wo are at, best a commun-, it.y ;of financial mendicants,'.hedging enp., in hand from a foreiim .Tev/ for a few .nounds to pay onr wages with. 1 . /.If our : legislators .-.Will pive. us .some bank reform this session,'.'and •jsuDplement'., that',"with;a '.Stiite. inconvertible paper issue."we may gain Bonm~firinncinl'J.e.lfrespect. and jwhile carrying, forward oiir public.' .work? .bu'jW .Jtfytrfeff,-technical industries far'.which to\ proviso :perm.anf,nt settlements, for . ftrid\ emplovment 'of blir people. . Tho banlc ;roform I- outline is based - on- American and/Ger- , mari. Thn- currency .reform. Argentine and Tussian.,, The results of both'are'so frood tbat.'.l. si'iccroly , wish for their adoption here.—l am, etc., • •••' : , . J. B. nOBART.