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2"
VOLUME ,5, .-NUMBER 51
The Commoner.
m:
Secretary Shaw: Tho Associated Press, under
dato of Chicago, December 28, said that Score-
tary ohaw nau aociaroa uiui, i.jiviu ui
criminal prosecution: growing out ,of the closing
of Walsh's financial institutions. In that dispatch
the secretary waB quoted as having said:
"John It. Walsh did not take one dollar '
dishonestly. He did no more than many other
bankers in the United States are doing all
the time. , .
"The rumor of criminal prosecution is
nothing but talk. There has been no em
bezzlement or theft. For every dollar taken
out gilt edged security was placed within.
' Tho depositors will get every dollar they de-
posited, and when that has been accom
plished, the responsibility of the government
ceases. That part of the banking law pro
hibiting the loaning of more than 10 per cent
of the capitalization to one man may have
been violated. That is not a criminal viola
tion and all that can be done is to liquidate
tlie bank and pay off the depositors. The
violation of that law by one bank is no more,
than has been done by almost every bank in
tho country."
Paraphrasing Shaw: Richards and Comstock
did no more than many other cattle raisers in
the United States are doing all tho time. Every
acre of land which these monopolists unlawfully
used will bo restored to the public domain. The
violation of that law by Richards and Comstock
is no more than has been done by almost every
large cattle raiser in tho country.
Tho offense committed by Richards and Corn
stock was not a criminal violation if the offense
committed by John R. Walsh is "not a criminal
violation." Tho wrongdoing by Richards and Com
stock was, as Judge Munger said, "a statutory of
fense" if, as Secretary Shaw intimates, the wrong
doing by Walsh is a statutory offense.
Let us take a look at the banking law, and
see whether Walsh's offense was not a criminal
violation.
Secretary Shaw admits that "that part of the
banking law prohibiting the loaning of more than
10 per cent of the capitalization to one man
may have been violated." He might have said
that that part of the law had actually been vio
lated. And it was violated for the use and benefit
of John R. Walsh, tho president of the institution.
Section 5200 of the banking law prohibits the
loan to any one association, person, company or
firm of moro than "one-tenth part of the amount
of the capital stock of such, association actually
paid in."
Section 5209 provides: "Every president, di
rector, cashier, toller, clerk, or agent of any as
sociation who embezzles, abstracts or wilfully
misapplies any of the moneys, funds or credits of
the association shall be deemed guilty
of a misdemeanor, and shall bo imprisoned not
Mess than five years, nor more than ten years."
Defining the word "embezzles" as used in this
section, the courts have held: "If the president
of a bank charged as a trustee with the admin
istration of the funds of the bank converts them
to his own use he embezzles and abstracts them
UNLESS HE SHOWS AUTHORITY FOR SO DO
ING." Walsh had no authority for loaning to
himself money in excess of 10 per cent of the
bank's capital.
Defining the term "wilfully misapplies," as
used in this section, it; has been held by the
courts: "It is not necessary that the party who'
misapplies should derive any benefit from the
transaction." When we remember that it is not
denied that Walsh derived benefit from these
transactions, it would seem that there is not (he
slightest justification for saying that his offense
is not a criminal violation so far as "wilfully
misapplies" is concerned.
, Defining the same term, the courts have held:
"A.' director violates this clause if, knowing that
he hds no money to his credit in the bank and
no right to draw money therefrom, he, obtains
money from it to which he has no right by means
of his overdraft made with intent to defraud, and
converts the same to his own use in fraud of the
hank."
When Walsh as president loaned to Walsh as
individual money in excess of 10 per cent of the
bank's capitalization, ho was guilty of criminal
violation according to the interpretation repeated
ly placed upon the statutes cited. That he has
merely done what many others have done before
him is an old time defense advanced in behalf
of Influential law-breakers. It is the same de
fense advanced in behalf of the men charged
with the illegal fencing pf government land.
If Shaw is right in tho attitude he assumes
toward Banker Walsh, Judge Munger was right
in the position he took when he came t,o impose
.' sentence upmi Richards and Comstock. And. if
Hunger was right, then Mr. Roosevelt and Sec
rotary Hitchcock of tho interior owe that federal
judge an apology, whilo Mr. Roosevelt owes to
Marshal Matthews and District Attorney Baxter
prompt reinstatement.
As a matter of fact, Munger was wrong and
Secretary Shaw, who assumes practically the
same position Munger did, is also wrong.
And if there is anything more than shqer
buncombe in Mr. Roosevelt's far famed boast con
cerning "a square deal" ho will be' as prompt in
removing from office the powerful Shaw as he was
in dismissing the comparatively uninfluential
Matthews and Baxter.
JJJ
WHAT IS CORTELYOU'S DEFENSE?
Reference is made in another column of this
issue to tho statement made to the insurance
committee by Andrew Hamilton the insurance
lobbyist. From Hamilton's own description of his
methods, and, from his present-day attitude, it is
entirely fair to conclude that he was employed
by these insurance magnates not in the further
ance of legitimate work, but as an artistic cor
ruptlonist. What a wretched affair this entire mess is!
Does it not occur to intelligent men that it is
strange that all these things may be done with
out any of the men responsible for them being
called seriously to account? According to this
man's own testimony he received nearly one mil
lion dollars of the policyholders' money, and he
expects the owners of that money to accept his
word that it was spent in a legitimate way and
for their best interests.
According to the testimony of the insurance
magnates several hundred thousand dollars of the
policyholders' money was paid to the republican
national committee a considerable sum thereof
passing through the hands of a member of tho
president's cabinet. While republican newspapers
do not hesitate to condemn Senator Piatt because
he took an occasional ten thousand dollars for
use in the New York state campafgn, the people
are expected to forget the very serious and solemn
fact that a large amount of these embezzled funds
haye been traced to a member of the president's
cabinet acting as chairman of the republican na
tional committee.
Hamilton has one excuse which may pass
muster with some people. It is the excuse that
tho large sums he received were spent in the ef
forts to prevent legislation to which the insurance
magnates were opposed. We do not yet know
what defense the member of the cabinet, who re
ceived a considerable portion of these stolen
funds, has to offer. Can it be that his defense
is similar to that of Hamilton? . There certainly
must be some defense. And Mr. Roosevelt ought
to know by this time that the members of his
own party, as well as the people generally, are
becoming restless in the absence of any explana
tion as to that portion of the stolen funds traced
to the republican party's treasury.
JJJ
HUMILIATING
The New York insurance committee has done
some excellent work; but many who have been
prompt to express their gratification because of
the good work already accomplished were doubt
less a bit disgusted "vhen, in the report concern
ing the testimony ' Thomas F. Ryan who suc
ceeded Hyde in tb jntrol of the Equitable they
read one portion i the dialogue between the com
mittee chairman and the great monopolist.
The committee sought to have Mr. Ryan say
just what Mr. Harrlman had told him when the
latter endeavored to obtain a share in tlie Equit
able fortunes. The following dialogue explains
. itself:
The chairman: "Mr. Ryan, the committee
does not want'you to think it is being offi-
clous in the matter."
Mr. Ryan: "I know that."
The chairman: "It thinks you performed
a great public service and is only seeking to
get you to conyfleto that service."
Mr. Ryan: "I still feel that I should not.
be required to answer."
What are the facts? Mr. Ryan paid
$2,500,000 for the control of the Equit
able. Honestly, he would have received on that
investment only about $3,514 in dividends. But
in purchasing this stock Mr. Ryan obtained con
trol of the Equitable and In controlling the Equit
able Ryan controlled about $413,000,000 of policy
holders' money.
Remembering that Mr. Ryan wields control
over a number of other important monopolies,
.does any one for a moment, imagine that he
was actuated by ahv deen-HGatfiri nnnnmn. v,. tii
..public .welfare in paying out $2,500000
for stock which, legitimately, returned onlv $1 r,u
-in dividends? ' ,; ,ou
Men must know that Mr. Ryan had an axe
to grind, and that he wanted that axe ground very
fine.
If Mr. Ryan had been looking out for the
public welfare or for the welfare of the policy
holders, his first act would not have been to
select as the president of his company a dis
credited member of the president's cabinet. In
stead of selecting a lot of trustees who, so far as
the real power goes, are nothing more nor less
than "dummies," Mr. Ryan would have yielded
to the long-sought petition of the Equitable policy
holders by actually mutualizing the Equitable.
He has established, so far as the interests
of the policyholders are concerned, no genuine
reforms in the Equitable. For the double barreled
control of Hyde and Alexander he merely substi
tuted the one-nmn control of Ryan; and, as one
kNew York newspaper put it, where the reign of
Hyde was "a public scandal" the reign of Ryan is
"a public menace."
JJJ "
A nee6ed reform
111 his annual report Postmaster General
Cortelyou calls attention to the fact that during
the last year twelve mail clerks were killed while
on duty, 125 were seriously injured and 38G
slightly injured. The mail clerks are engaged
in a hazardous duty and it seems high time that
the government take steps looking towards their
better protection. It is a notorious fact that al
though the government pays a rental for mail
cars that annually exceeds the first cost of theso
cars, -the cars provided by the railroads are the
flimsiest of all cars used. A majority of the
collisions on railroads are what is called "head-on
collisions," and as the lightly built mail cars are
always at the head of a train the natural result
is that they are usually the ones sustaining the
greatest damage. This will explain in a measure
why so many mail clerks are killed and injured.
The statistics given above do not include the-four
mail clerks recently killed in Wyoming.
Men engaged in a work so hazardous as that
of the mail clerks are certainly entitled to more
than ordinary consideration. The least that tho
government can do is to insist that the railroads
furnish mail cars solidly built, and equal to tho
heavy steel passenger coaches and Pullmans now
in universal use. No private patron would sub
mit to the extortion and poor service that tho
railroads practice upon Uncle Sam. And in addi
tion to demanding better cars the government
should provide some system whereby the de
pendent relatives of mail clerks who are killed
while on duty may be provided for. The men
engaged in the railway mail service are the most
. illy paid servants of the government when the
. exacting and dangerous nature of their work is
taken into consideration.
JJJ
DETAILS WANTED
The first bill introduced in the Fifty-ninth
congress was one appropriating $16,000,000 for
the Panama canal. Ten millions have already
been appropriated and expended, and so far as
any one knows nothing -tangible in the way oc
canal construction has been performed. Beiore
any more money is appropriated would it not do
well if the country were Informed just how tno
first $10,000,000 was spent? There are some in
teresting rumors afloat concerning certain items
of expenditure, and the country has a right to
know if they have any basis of truth. The im
portation of 'certain "commodities" om Mar
tinique should be explained. So, too, should tne
importation of laborers from Jamaica. It is ie
ported on seemingly good authority that these
Jamaican laborers were induced by false repre
sentations to go to Panama, and that upon ar
riving there they had to be driven ashore wiui
clubs because they discovered that they had been
basely deceived as to wages, hours and condi
tions. . 1
The country wants a canal connecting xw
Atlantic and Pacific oceans, and the Panama route
having been decided on they want the canai
built there. But they have a right to know how
the money is being expended, ana uiey ;
right to know all about the conditions prevailing
in the canal zone. Certainly with such avaj
army of "experts," clerks and well paid omcwib
it should be easy to keep the books in siicii v
manner as to afford the people this knowieuM.
If the people are not taken into the confidence
' of. the well paid gentlemen who are living ; m
state at government expense In the canal zom.
then the people should decline to furnish any
more -money until a new and moro accomodating
set 'of officials, is put in charge.
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