reserve currency in ordinary times. So far as the banks of the country are concerned, it therefore becomes an institution for the most part which can be beneficially used in times of emergency alone.

FORCED COMPETITION.

This will force, in normal times, the Federal reserve bank into greater open-market loan operations in competition with all other banks. Imagine these great central banks, with capital and deposits aggregating, say, $400,000,000 to $500,000,000-paying no interest on deposits-with their immense facilities for the creation of credits and the emission of currency, launched upon the country by the first of next year after the peak of the present demand for currency is passed. Will it not bring the country face to face with all the perils arising from a future inflation both of credits and currency? 8. This plan compelling the national banks to furnish to competitors both capital and business, and divorcing ownership from control by putting these competitors under the control of political appointees, brings the banking system of this country into the situation again from which it emerged after Andrew Jackson, backed by the State banks on one hand and the radical politicians on the other, ruined the Second Bank of the United States and plunged the country into the devastating and terrible panic of 1837. After the establishment of the Federal reserve banks the business of the country will become adjusted to their existence. They will enter the fabric of our business. Attacks on them, compelling retrenchment on their part, will bring a repetition of the disaster which the enforced contractions of credits by the Second Bank of the United States brought to us once before.

THE PERIL OF POLITICS.

If this bill is passed, our banking system is again projected into politics. If one would know what this means to the business and prosperity of the Nation, let him read the financial history of the United States from 1830 to 1840.

9. Upon no other one agency does the prosperity of our people more depend than upon our banking system. No greater calamity to their interests can come than from the passage of an ill-advised measure of alleged reform which will cripple or largely destroy the great system of national banks which is now a part of the web and woof of business.

There is nothing more delicate or dangerous to tamper with than the credits of a nation. If we do so to their disaster, it will be no satisfaction to reflect that among the ruins of a past prosperity may be found the remains of the political party which, under the guise of constructive effort, has driven the knife into the vitals of legitimate and honorable American business. The industry and capital of the country must awaken now to the menace that confronts them in the administration currency bill, and not wait until after they have paid the price of prosperity for the knowledge which experience would bring.

O

TAXING GOVERNMENT PROPERTY.

MESSAGE

FROM THE

PRESIDENT OF THE UNITED STATES,

TRANSMITTING,

IN RESPONSE TO A SENATE RESOLUTION OF FEBRUARY 18, 1913, A COMMUNICATION FROM THE SECRETARY OF STATE, TOGETHER WITH INFORMATION RELATING TO THE TAXING OF GOVERNMENT PROPERTY IN THE SEVERAL CAPITALS OF THE LEADING COUNTRIES OF THE WORLD.

AUGUST 13, 1913.-Ordered to lie on the table and to be printed.

To the Senate:

I transmit herewith a report from the Secretary of State, submitting copies of the dispatches received from the diplomatic officers of the United States, to whom were addressed instructions prepared with a view to carry out the resolution of the Senate of the United States, dated February 18 last, requesting the Secretary of State, "through the diplomatic and consular officers of the Government, to ascertain the system of taxing Government property in the several capitals of the leading countries of the world, a full and complete report on the subject to be transmitted to the Senate at the earliest practicable day."

THE WHITE HOUSE,

Washington, August 13, 1913.

The PRESIDENT:

WOODROW WILSON.

The undersigned, the Secretary of State, has the honor, in reply to the resolution of the Senate of the United States dated February 18, 1913, requesting the Department of State "through the diplomatic and consular officers of the Government to ascertain the system of taxing Government property in the several capitals of the leading countries of the world, a full and complete report on the subject to be transmitted to the Senate at the earliest practicable

day," to say that a circular instruction was prepared calling on the diplomatic officers at the capitals of the leading countries of the world to report in compliance with the terms of the resolution. The reports from those officers, so far as they have been received, are submitted herewith.

SIR: In answer to the department's circular instruction of February 20 last, directing me to report upon the system of taxing Government property in St. Petersburg, I have the honor to inform you that the property of the Government here is not taxed by the Crown and is only taxed by the municipality when it derives an income by renting to outside parties. In the latter case the same system of taxation is employed as upon private property.

I have, etc.,

The SECRETARY OF STATE,

Washington.

CURTIS GUILD.

LISBON, March 29, 1913.

SIR: Referring to your circular instruction of February 20, 1913, I have the honor to inform you that I am in receipt to-day of a note from the minister for foreign affairs in which he states that "in Portugal Government property does not bear the burden of any tax or contribution."

I have, etc.,

The SECRETARY OF STATE,

Washington.

CYRUS E. WOODS.

BRUSSELS, April 1, 1913.

SIR: In compliance with the department's circular instruction of February 20 last, I have the honor to inclose a copy of a report, prepared at my direction, regarding the system regulating the taxation of the property of the Government of Belgium in Brussels.

I have, etc.,

THEODORE MARBURG.

[Translation.]

In response to your request for a report on the system regulating the taxation of the properties of the Government in Brussels, I have the honor to advise you as follows:

The properties of the State are of two classes, viz, public property, properly speaking-that is, belonging to the State and used for the general welfare, such as roads, canals, churches, museums, the offices of the ministries, the royal palaces, the libraries, etc.-and private

property, such as real estate, vacant and without owners, and estates in escheat.

On the other hand, the contributions, taxes, and impositions are subdivided

(a) In land taxes covering the ground and what is built thereon. (b) In personal taxes, which cover the renting value of the buildings, the doors and windows, and the value of the furniture in the said buildings, without mentioning the other bases, servants, horses, etc., which are outside of the question under consideration at present. The ground taxes, as well as the personal taxes, are levied-that is to say, collected-by the collectors of the State, but their product is divided between the State, the Province, and the commune.

(c) The communes have also the right to levy taxes and contributions on properties existing in the commune, as well as on the persons who live therein, and the trades, professions, and businesses carried on therein. The commune has the right to levy additional taxes, which are outside of the question under consideration.

(A) GROUND TAXES.

The law of the 3d Frimaire, year 7, article 105, and the decree of August 11, 1808, establish that the following improved properties are not subject to the ground tax:

(a) Unproductive national properties, such as the palaces, castles, and royal buildings, the Palace of the Senate, the Chamber of representatives, the houses used for the residences of the ministers, the public administrations, and their offices.

(b) The churches and temples consecrated to public worship.

(c) The houses of the archbishops and bishops, seminaries (the establishments known in Belgium as "little seminaries" are not exempt from the land-tax decree of the Court of Cassation, Dec. 21, 1865), and rectories (vicarages are not exempt from the land tax). (d) Buildings occupied by the courts and tribunals.

(e) The military school, the State universities, the atheneums, colleges, schools (private schools which are not established under the direction and the inspection of the public authority, even though they are established in a property belonging to a charitable institution or any other public establishment (Cassation, Jan. 23, 1882); a royal order of September 17, 1818, exempts from the land tax the schools belonging to charitable establishments or where an entirely free instruction is given), libraries, museums, botanical gardens belonging to the State, to the Provinces, and to the communes.

(f) The buildings occupied by the administrations of the provincial and communal governments.

(g) The asylums are subject to the ground tax if the buildings belong to a private party who gratuitously concedes the occupation thereof to the administration of asylums. (Cassation, Nov. 11, 1867.) The poorhouses, the prisons, and the houses of detention. (The pawnshops remain subject to the ground tax. Cassation, Jan. 29, 1868.) (h) The fortifications, arsenals, magazines, barracks, and other military establishments.

(i) The gunpowder factories and others for the account of the Government; in short, all the unproductive buildings devoted to the public service, except in cases where they belong to private parties.