The direction of its development is not toward atrophy, but is rather toward expansion along new lines and with new purposes. These purposes are essentially those of public service. As industrial organization becomes more complex and as the effect of banking upon industry and prices is better and better recognized, it becomes more and more necessary to provide regular access to credit and not to leave such access open to chance or casual bargaining. In all institutions which have been developed as the result of modern specialization of industry, the gradual evolution has been in the direction of a recognition of public-service qualities. Two hundred years ago even ordinary roads were regarded as private property and tolls were charged for passage over them. The same was true of bridges, and when railroads came into existence it was a long time before their position as common carriers was recognized and rates and fares reduced to a standard basis, while the duty of maintaining regular service was insisted upon. In the same way banking, which began as money lending and whose service as well as the charge for it has for many years been the subject of negotiation and bargaining, is tending more and more to assume a standardized form. This standardization is seen to best advantage in the increasing unity and similarity of commercial banking requirements, in the practical identity of different types of paper, and in many other ways. It appears also in the constant demand that provision shall be made for credit for the moving of crops and for all sorts of necessary operations which shall not be dependent upon private enterprise or activity, but shall be the result of community action. It is the perception of the public-service nature of banking, no doubt, that has led some nations and states to enter the business. The belief that access to credit has been cut off or unduly restricted by combinations of capital in order to drive individuals out of business or to promote the prosperity of others, is difficult to prove in any particular instance. It is probably seldom attempted in the crude forms that are sometimes referred to in current prints. Knowledge of economic history, however, shows how transportation was used for competitive purposes, and there is no reason to doubt that a similar misuse could be made of banking and credit. A recognition, therefore, of credit facilities as practically an essential necessity of business leads further to a recognition of full public-service character, and hence to the safeguarding of conditions under which banks operate and under which loans may be granted.

No success has thus far been had either in regulating rates of interest or in controlling the conditions under which loans are made or the amount of accommodation to be extended on specified security. Public-owned banks when organized have been unsuccessful in the majority of cases. Better success has been had with co-operative banking enterprises, best exemplified in various rural credit undertakings, but even these have found their success greatest when their operations were simplest and most closely standardized, while their success has been least in those cases in which they ventured into complex transactions which were not understood by their constituents and in which the pressure to attempt difficult or impossible operations was too great to be resisted. Public management of banking, or even the application of absolutely rigid requirements to it in the sense in which such requirements are applied to transportation companies, is certainly a long way in the future.