THE FALLING OFF IN SAVINGS-BANK DEPOSITS. [TO THE Enrroa OP
THE "SPECTATOR."]
Snz,—I have read with great interest the editorial articles and the correspondence in your paper on the question of the day, —the national inquest. You are wisely, I think, admitting letters representing all sides and every shade of opinion.
So far I have not observed that any one has drawn attention to the falling off in our savings-bank deposits. On the 22nd ult. the 4:481 amount was £197,600,000, and at the corresponding date in July £198,600,000. This is an absolute decrease of half-a- million, and may perhaps be accounted for by the holiday with- drawals, but a much more serious point is that the increase in the savings for the twelve months is only £2,500,000. I am writing away from books of reference (not even a "Statistical Abstract"!), but my recollection is that two or three years ago the savings were increasing at the rate of £7,000,000 to £8,000,000 a year. My attention has been more particularly called to the matter to- day because I have been looking into an article in the New York Financial and Commercid Chronicle of the 15th ult, which shows that the State of New York (with, I think, seven million inhabi- tants) had on July 1st, 1903, £222,000,000 deposits in the savings. banks of the State, and the increase over July 1st, 1902, WU over £12,000,000, with 2,327,812 accounts open. The average increase for the last six years (1897-1903) has been £12,300,000 per annum.
These are very remarkable figures, though I do not wish to press the comparison of these savings of seven million people, and the savings—amounting to X197,500,000—of our own forty million people, because one can never be certain that one is com- paring exactly like with like. It is necessary to know the com- ponents in each case,—but the figures, simply stated, without drawing conclusions from them, may be of interest to your readers. The point of my observation, however, is that there is scarcely any falling off in the increase of the New York State savings compared with last year, although the people there have had their share of labour troubles, strikes, &c.; whereas the increase in the savings-bank deposits in Great Britain is a good deal less than half of what it was three or four years ago. Yet you call a great deal of attention to the marvellous apparent prosperity of our people judged by the figures of imports and exports, railway revenues, Income-tax returns, &c. But I have not noticed that you attempt to explain the falling off in savings this last year or the increase of the unemployed. I ventured to call attention to these two points in a paper in the current num- ber of the Nineteenth Century, but I have never seen the causes dealt with. My own theory is that a great deal of our apparent prosperity—in the last five or six years more particularly—has been due to excessive borrowing by our Government, by our municipalities, by our railway and shipbuilding companies, and by private persons, with the inevitable accompaniment of borrow- ing, namely, profuse extravagance, in every section of the com- munity. This is my explanation (and an explanation is needed of the present position in the stock markets), and I shall be glad if you or any of your correspondents can either confirm it or rebut it.
[No solid inferences as to the prosperity of the British working classes can be based upon the figures cited by Mr. Cross as to the amounts of our savings-bank deposits. Very large, and largely increasing, amounts of their savings are invested in small house-property, in Consols (especially when standing at a low figure, and offering at least the possibility of a considerable capital gain), and in stocks of Corporation undertakings, the circumstances of which are known to the investors. But no Returns on these points are available.—En. Spectator.]
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