AN HISTORICAL AND CRITICAL STUDY OF OF THE UNITED STATES BY EDWIN W. KEMMERER PROFESSOR OF ECONOMICS AND FINANCE UNIV. OF PRINCETON UNIVERSITY PRESS LONDON: HUMPHREY MILFORD OXFORD UNIVERSITY PRESS 1917 PREFATORY NOTE The financial uncertainties growing out of the European War, the widespread thrift campaign which has been undertaken under the pressure of war conditions, and the resulting great increase in the public's patronage of the postal savings banks have given rise to an unusual public interest in our American postal savings system. This unusual public interest and the fact that there exists nowhere a comprehensive account of the development and present day workings of our American postal savings system furnish the excuse for this volume. The material here presented is to a substantial extent a revision and integration of material contained in two magazine articles previously published by the author. It is used here with the consent of the magazines' publishers, for which grateful acknowledgment is made. The articles were: "The United States Postal Savings Bank," published in the Political Science Quarterly, volume XXVI (1911); and "Six Years of Postal Savings in the United States," published in the American Economic Review, volume VII (1917). iii 421442 In the collection of material the author has made numerous calls upon the officials of the Postal Savings Division of the Post Office Department at Washington, and wishes here to express his gratitude for the generous and courteous assistance which these officials have given by furnishing information from their unusually well kept records. In this connection the author wishes particularly to express his gratitude to Third Assistant Postmaster-General Alexander M. Dockery; Director of Postal Savings Carter B. Keene; and Assistant Director of Postal Savings Charles H. Fullaway. To his colleague, Professor Neil Carothers, the author is greatly indebted for the laborious work of preparing the table of contents and the index and for valuable assistance in connection with the reading of proof. Princeton University, CONTENTS Long duration of the movement, 1-2.— Movement encouraged by panic of 1907, 2-4.- Declarations of political party platforms in 1908, 4-6.- Debate over desirability of postal savings, 6-7. Question of the adequacy of existing savings facilities, 7-8. - Statis- tics relating to existing facilities, 8-10. — Comparison of postal facilities and banking facilities, 11-12. - Fear of competition with existing banks, 12-13. Opposition of bankers, 13-15.- Argument against the fear of competition, 15-16.- Losses to depositors Classification of provisions, 21. — Administration by a Board of Trustees with discretionary powers, 21-24. Provisions for deposits, 24-25. - Provisions for withdrawal of deposits, 25–26. - Reserves against deposits, 26-28. - Centralization of administration, 28-30.-The form of credit given to depositors, 30-31.- Method of determining the rate of interest paid depositors, 31-32. Selection of a two per cent insure constitutionality, 40-42. — Final provisions for investment, 42-45.- Privilege of bond investment granted to depositors, 45-46. Merits of this pro- - - |