34

POSTAL  SAVINGS

high  at  first,  as  it  had  been  in  Canada, 17  it  would
be  difficult  to  reduce  the  rate  because  of  political
pressure  ;  if,  on  the  other  hand,  experience  should
prove  the  rate  to  be  too  low,  as  was  discovered  to
be  the  case  in  the  Philippines  some  years  ago, 18
it  could  readily  be  raised.  These  considerations
led  to  the  selection  of  the  rate  of  2  per  cent,  “the
same  to  be  computed  on  such  basis  and  under
such  rules  and  regulations  as  the  Board  of  Trustees ­
  may  prescribe.” 19  This  rate  is  a  low  one  as
compared  with  that  paid  in  other  countries.  It
was  in  fact  then,  and  is  still,  the  lowest  rate  paid
on  savings  deposits  by  any  postal  savings  bank
in  the  world. 20  The  United  Kingdom  paid  2.5
per  cent,  Canada  3  per  cent,  France  2.5  per  cent,
Japan  4.2  per  cent,  Austria  3  per  cent,  Hungary
3  per  cent,  Sweden  3.6  per  cent,  and  the  Philippine ­
  Islands  2.5  per  cent.  When  it  is  remembered ­
  that  the  prevailing  rate  of  interest  was  normally ­
  higher  in  the  United  States  than  in  most
countries  of  Europe,  it  is  clear  that  Congress  did
not  err  in  the  direction  of  too  high  a  rate.
17  Hamilton,  Savings  and  Savings  Institutions,  pp.  415-419.

18  Report  of  the  Chief  of  the  Bureau  of  Insular  Affairs,
1910,  p.  6.
19  Sec.  7  of  act.
20  See  tables  following  p.  128,  Sen.  Doc.  No.  658,  61
Cong.,  3  Sess.