in shingles and lath, and 40,000,000 feet of hard wood. The total value will be fully $14,000,000. About one-third of the pine is sawed at Minneapolis, about one-sixth at Stillwater, the same at Winona, and nearly as much at and near Duluth.

The products of the flour and grist mills were in 1850, $500 in value; in 1860, $1,300; in 1870, $5,718,887, and in 1880, $41,519,004. Wheat was the material used for more than 98 per cent. of the above. There will have been, in round numbers, 8,500,000 barrels of flour made in the State in 1886, more than threefourths of it being the output of Minneapolis mills.

The production of building materials other than lumber is very rapidly increasing; red and cream-colored brick, gray and white limestone, white, pink, and brown sandstone, gray and black granite, lime, cement, and artificial stone.

Mining is an infant industry with us. Iron mines are opened at Tower, from which the first shipments of ore were made in 1884, of 62,124 tons. Eleven hundred men are now employed in them, and the shipments in 1886 amounted to 305,954 tons.

So much for the material thrift of State and people. What is their provision for education of youth, for care of incapables, for repression of crime, for preservation of health, for moral growth?

The theory of the Minnesota educational system is that the State shall furnish free instruction to every resident child, in common and grammar schools, high schools, the university and professional schools. The system is fully adopted and is in operation as far up as the university and such professional schools as are already established.

One-eighteenth of all the land in the State is devoted to form a permanent school fund, which, already amounting to $7,311,898, will probably finally reach $18,000,000, or $20,000,000. In addition to the revenue from this fund, taxes are levied annually at the pleasure of each district for the support of common and graded schools. From the aggregate thus obtained in 1885, which was $2,442,612, schools were maintained in 5,234 districts, employing 7,136 teachers, and having 243,059 pupils enrolled between the ages of five and twenty-one years. There were 346 new schoolhouses built that year, at a cost of $508,070. The value of all school-houses and sites is $6,906,166; of school apparatus, $97,243; and of school libraries, $31,796.

High schools, fifty-nine in number, assisted by appropriations

of State funds and subject to examination by a State High School Board, prepare students for the State University. Graduates from grammar schools may enter the high schools, and graduates of the high schools may enter any college or university in the State without further examination.

The University has a special grant of lands for its support and receives large appropriations annually. It now has a faculty of 30 professors and instructors, and numbers 406 students, of whom 25 are post-graduates, 113 are in the preparatory, or sub-freshman class, 86 in the artisans' training school, and 50 are pursuing special courses. The Agricultural College, now a part of the University, operates an Experimental Farm of 250 acres. The invested fund of the University amounts to $851,526, to which the sale of its remaining grant will add $400,000; its grounds, buildings, and apparatus are valued at $983,000; its library contains 10,000 volumes and its museum 20,000 specimens.

Three Normal schools, with twelve to fifteen instructors each, apparatus, libraries, model schools, etc., taught 1,565 learners the last year and graduated 98 teachers. Their grounds, buildings, and equipment are of the value of $350,000.

A school for the deaf and the dumb, one for the blind, and one for imbeciles, are among our most favored and most successful institutions. Their structures and sites represent investments of $300,000.

Besides these State educational institutions, many private schools exist, and, notably, denominational colleges, or those under the special care of various religious denominations, as Episcopalians, Methodists, Presbyterians, Baptists, Congregationalists, Lutherans, and Catholics.

The insane are cared for in two asylums, in which adequate accommodations are afforded for 1,600 patients. Inebriates may become the subjects of treatment in these. A third asylum is now locating, and its construction will be commenced another sea

son.

Several orphan asylums are supported by private and municipal bounty.

The one State prison has at length been found insufficient for this day, especially as it does not permit the separation of first term offenders, of whose reclamation there is reasonable hope, from the older and hardened criminals. Provision is made for

the location of a second prison, which will doubtless be of the kind known as reformatories. These prisons, with our most successful Reform School for juvenile offenders against the law, and for incorrigible children, and the State Public School, now just completed and opened, for the care of younger children of indigent or criminal parents, whose offspring might otherwise become criminal for want of attention and protection, will complete our system of correctional establishments. A non-partisan State Board of Corrections and Charities visits and examines all the penal, reformatory and eleemosynary institutions of the State, and, though without authority to manage or control either, by counsel and suggestion, and through recommendations to the Legislature, brings about co-operation in action and a better co-relation of functions of all.

A State Board of Health, acting largely by the agency of local boards, which it is authorized efficiently to direct, has proved itself adequate to protect against the spread of contagious and infectious diseases among men and also among domestic animals.

Derived from peoples long since civilized and Christian, the inhabitants of Minnesota inherit and cherish the religious character and morality of their ancestry. The church and Sundayschools supplement the instruction of the secular schools. Vicious practice and crime are as infrequent as among any other equal population.

Such are the beginnings of the progress of Minnesota.
L. F. HUBBARD.

THE FUTURE OF THE NATIONAL BANKING

SYSTEM.

THE National Bank Act requires that banks having a capital of $150,000 and more than that amount, shall keep on deposit with the Treasurer of the United States not less than $50,000 of United States bonds as security for circulating notes, and that banks having a capital of less than $150,000 shall keep on deposit an amount equal to one-fourth of their capital as security for circulation. Circulation has ceased to be a profit, and, in many cases, is a burden to the National banks under existing laws. Many of the small banks of the country hesitate to organize under the National system, because they are obliged to buy United States bonds at the present high premium.) Legislation is therefore suggested, which will authorize all banks having a capital in excess of $150,000 to keep on deposit $25,000 of United States bonds; and all banks having a capital of from $50,000 to $150,000, to keep on deposit an amount equal to one-eighth of their capital; or, what probably would be still better, authorize the smaller banks having a capital of from $50,000 to $75,000 to organize upon a deposit of $5,000, and banks with a capital of $75,000 and less than $150,000, to organize or continue business upon a deposit of $10,000 of United States bonds. This would permit all National banks which do not desire circulation, to conform to the law without the necessity of purchasing United States bonds at the present high rate of premium.

Such a bill would be improved if the amount of circulating notes to be issued should be increased to one hundred per cent. upon the par value of the bonds, instead of ninety per cent., as now authorized by law. This would be in accordance with the McPherson bill, which passed the Senate last winter, but which failed to pass the House. Indeed, the premium upon 4 per cent. and 41⁄2 per cent. bonds is now so high in the

market, that the percentage of issue could be largely increased with safety to the bill holder. A law which authorizes the issue of ninety per cent. upon 3 per cents., worth only par in the market, and only ninety per cent. upon a 4 per cent. bond, worth 128 in the market, would seem to be imperfect. The holder of $100,000 of United States 4 per cent. bonds can readily borrow $120,000 in the New York market upon such bonds as collateral, and many banks hesitate to deposit bonds as security for circulation, which have a margin of more than one-third upon the amount of circulation issued. The rate of issue upon 4 per cent. and 41⁄2 per cent. bonds should be increased to ninety per cent. upon the average market value of the bonds for the six months previous; and if, at any time, the security should be deemed to be insufficient, the Comptroller can call upon the banks for an increased amount, as now authorized by law, or the circulation can be reduced as the bank notes are redeemed from the five per cent. fund, deposited by the banks in Washington for that purpose, and the Treasurer can also be authorized to withhold the interest upon the bonds.

2. Provide for the refunding of the 4 per cent. bonds, amounting to $738,000,000 now outstanding, into 22 or 3 per cent. bonds, offering the inducement to the holders of these bonds to exchange them for the new ones to be issued, the Government paying to the holders the difference between 21⁄2 per cent., or 3 per cent., and 4 per cent.-the difference in value to be ascertained by an exact calculation by the Actuary of the Treasury Department.

If a farmer had a long mortgage upon his farm, bearing 8 per cent. interest, and he had the ready means to pay a portion of the amount, it would be a good proposition for him to offer the holder of the mortgage a payment of interest in advance, reducing the rate of interest upon his mortgage from eight per cent. to five per cent. if possible. There would be no difficulty in a farmer understanding a proposition like that. He would be able to use his ready means and improve his credit, and the transaction could be so arranged that the party to whom he made the payment would also be benefited by receiving his interest in advance.

In like manner the Government, having a large amount of surplus funds on hand, can use say 100 million dollars of that surplus by giving to the holders of the 4 per cent. bonds an