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How The Banks Filled Hanna's War Chest In
IMtlL 27, 1906
i
1896
S3
They Were Assessed One-Fourth of One Per Cent on Combined Capital and Surplus
And Two "Hurry-Up" Calls Made Upon Them During That Memorable Campaign
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Speaking' of "muck-rakes," James W. Breen
operated one very effectively when, in an -article
published in the New York Herald, Sunday, April
15, he told1 how the7 banks filled Mr. Hanna's war
chest during the campaign of 180G. Mr.. Breen
tells the story of how bank directors voted' to
the republican party funds intrusted to their
care. One-fourth of one per cent on combined
capital and surplus was levied against the banks
of the country, and two calls were made.
Mr. Breen makes it clear that these assess
ments and contributions were known to bank
examiners under the control of the comptroller
of the currency, and were suppressed. He adds:
"It is doubtful if any bank, examiner was simple
enough to imagine that payments of this kind
were lawful."
Mr. Breen points out, also, that Senator
Knox of Pennsylvania, who is - one of the sub
committee of the committee on privileges and
elections charged with the preparation of a bill
to prevent improper campaign contributions, was
in 1896 a director of one of the Pittsburg banks
which contributed; that Senator ' Knox must
have known of these contributions.
Mr. Breen says that the following circular
was in 1896 sent to Pittsburg bankers:
Pitts.burg, Sept. 2, 1896. To tlie Board
of Directors of the City Deposit Bank. Dear
Sirs: The .undersigned have been appointed
a committee to" solicit from the banks funds
in aid. ,of the campaign for the republican
national ponimfttee. The ban.ks of New Y,ork
and some other places have been contributing .
on the basis of one-quarter of 1 per cent
of their combined capital and surplus, and
the national committee requests us to ask
the Pittsburg banks to do the same.
We only started yesterday afternoon,
and so far have found all the banks we have
approached willing to contribute on this basis.
So far we have received the following sub
scriptions; Farmers' Deposit National bank.. .,. ..,$5,000
People's National bank 5,000
National Bank of Commerce ., 2,000
T. Mellon & Sons 2,750
Bank of Pittsburg. . . 2,500
National Bank of .Western Penn 1,200
Union Trust company. . . , : 750
We are informed that the Second National
bank will give $5,000, and that in the other,
banks we have visited the matter is to be
brought before the boards and formally
recommended, so that we anticipate favor
able action by all. The campaign managers
are looking over a much larger area of
country than is usual in a national campaign
and it 'is taking a great deal of money. The
question is a vital one to all financial institu-.,
tions, and therefore is declared a proper and
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legitimate matter 'for contributions on the
part of the banks.
The subscriptions hero aro payable to
James S. McKean, chairman of -the auxiliary
finance committee, and by that committee
will be turned oyer to the national treasurer,
Cornelius N. Bliss, who will receipt to the
contributors. On the basis of what the other
bank's are doing the City Deposit bank Is '
asked to subscribe one-quarter of L per ce.nl
of its capital and surplus, which would bo
.somewhere in the, .neighborhood of- $450.
Trusting this matter.-will have your favorable
consideration, we remain respectfully,
' . ' ' T. H. GIVEN, - '' -
, , ... ,. F. P- DAY, ,. .
, " J A. W.JUELLQN,., .
, Committee
Mr. Breen says tliaf he obtained a copy of
this circular on September U, 1896. He made a
copy of It, and showed it to Albert .J, Barr, presi
dent of the Pittsburg Post , company,,, and that
several typewritten copies, of tho circular were
made in the Pittsburg .Post .office. He asked
the 'Post, which was presumably .supporting
the democratic ticket, to make tho circular pub
lic, but Albert J. Barr said that if it was pub
lished it would "rock the boat." Mr. Breen re
plied; "Why shouldn't it bo rocked?" and Mr,
Barr said that he would have tp tako the matter,
under advisement and consult with others. Mr.
Breen says: "Meanwhile Col. Guff ey, who was the
democratic national committeeman .from Penn
sylvania, had been informed of the affair and,
although not slow to resize. ,jts bearing upon the,
McKinley campaign, he advanced various.' 'busi
ness' reasons why it. would be inadvisable for, a.
democratic newspaper in Pittsburg to print this
evidence."
Mr. Breen further says that when he sub
sequently called upon Mr. Barr of the Post, that
gentleman thanked Mr. Breen for his- kind offer
but Informed him that he , had "very reluctantly
concluded not to takp the risk of publishing this
letter."
Following are some extracts from Mr. Breen's
article:.
"It is no secret in political circles that the
natjonal bank assessment of September 2, re
ferred to in the letter quoted above, was only
the fii;st installment of the various levies madei
upon the national banks of the country dur
ing that heated campaign. A month or more
later Hanna descended on Wall street, the alarm
was again sounded, and a tremendous fund was
raised for, the specific purpose of insuring the
success of McKinley electors in the doubtful
states, especially New York and Indiana. As
the circular letter itself plainly indicates, the
September collection was general throughout all
the large commercial cities of the north, and
the toll exacted by the call Issued later in the
campaign is reported to have been equally large?
INDIVIDUALISM VS. SOCIALISM
(Continued from Page 6)
benevolence, and devote his means, to. the causes
that appeal to him lias given an added stimulus
to hid endeavors; would this stimulus be as great
under socialism?
Probably the nearest approach that we have
fo thfl fionialistic state today is to be found In
the civil service. If the civil service develops
more unselfishness and more altruistic devotion
to the general welfare than private employment
does, the fact is yet to be discovered. This is
not offered as a criticism of civil service in so
far as civil service may require examinations to
ascertain fitness for office, but it is simply a refer
ence to a well known fact, viz., that a life posi
tion in the government service, which separates
one from the lot of the average producer of
wealth, has given no extraordinary stimulus to
higher development.
It is not necessary to excuse or to defend a
competition carried to a point where it creates a
submerged fifth or even a submerged tenth to
recognize the beneficial effect of struggle and
discipline upon the men and women who have
earned .the highest places in industry, society
and government.
There should be no unfriendliness between
the honest individualist and the honest socialist;
both seek that which they believe to be best
for society. The socialist, by pointing out the
abuses of individualism, will assist in their cor
rection. At present, private monopoly is putting
upon individualism an undeserved odium and it
behooves the individualist to address himself
energetically to this problem in order that the
advantages of competition may be restored to
industry. And the duty of immediate action is
made more imperative by the fact that the social
ist is inclined to support the monopoly, in the be
lief that it will be easier to induce the government
tp take over an industry after it nas passed Into
the hands of a few men. The trust magnates and
the socialists unite in declaring monopoly to be
an economic development, the former hoping to
retain the fruits of monopoly in private hands,
Confining the discussion, however, to the tan
glblc evidence actually in hand, it is seen that
eight Pittsburg banks paid an average of $3,118
each to the national republican campaign com
mittee in response to one call in a single cam
paign. .There aro now 12K banks doing business
through the Pittsburg Clearing House, in 18915
there were seventy. Maintaining this average ot
$:i,US for each of the seventy banks doing busi
ness. In Pittsburg, in 1896, It is seen that from
that city alone the committee would have real
ized the tidy sum of $218,260, as a result ot its
first , call for aid. A contribution of one-fourth
of 1 per cent of their capital and surplus by the
banks of tho United States would produce an
enormous, sum. In September, 1896, the national
banks, had, a capital of $658,126,915. The sur
plus would bring the total up to at least $J,
000,000,000. One-fourth of one per cent of the
amount would be $2,500,000. It Is not to be
assumed that all the national banks contributed,
but it is rca$3onably certain that most of those
in the larger cities did sorepresenting probably
four-fifths of the combined capital and surplus.
The state banks and trust companies un
doubtedly helped the work along. I have not
at hand statistics as to the capital and surplus
of these institutions, but it seems safe to assert
that the' banks furnished more than $2,000,000
to Mr. Hanna's war chest on the first call. ' It
will -mot be forgotten that late In October Mr.
Hanna called on the financial powers for a
second contribution- 'to make the doubtful states
secure.' If the call brought half as much, or
even one-fourth, as the first one the enormous
proportions of the McKinley campaign fund may
be estimated when It is remembered that prac
tically all the large Industrial and railroad cor- A
poratfons-were pouring gold into the treasury of
the republican campaign committee The esti
mate, so far as Pittsburg Is concerned, would
have to be reduced by eliminating tho co' fbu
tlon of one bank. Among tho directors ol the
bank in question was a well known citizen of
Pittsburg, who, when he heard of the proposed
contribution, or assessment, promptly objected.
The directors decided to go ahead, notwithstand
ing his opposition. He engaged a lawyer and
had papers prepared to procure' an injunction.
The directors then capitulated and no contribu
tion was made by that bank It will be noted
in- the circular of the banks given above that
it is stated that the committee will turn the
funds over to 'tho national treasurer, the Honor
able Cornelius N. Bliss, who will receipt to the
contributors.' In other words, each institution
paying money into the fund was given an indi
vidual receipt frdm Mr. Bli3s, who, consequently,
has, or at least had, knowledge of the identity .
of each separate contributor and the amount
turned over by such contributor to the general
fund. Consequently, if any senate or other com
mittee wishes Information as to campaign con
tributions, the means of obtaining such informa
tion are at hand."
the latter expecting the ultimate appropriation
of the benefits of monopoly by the government.
The individualist, on the contrary, contends that
the consolidation of industries ceases to be an
economic advantage when competition is elimi
nated, and he believes, further, that no economic
advantage which could come from the monopoli
zation Pf all the industries in the hands of the
government' could compensate for the stifling of
individual Initiative and independence. And the
individualists who thus believe stand for a mor
ality and for a system of ethics whicli they are
willing to measure against the ethics and morality
of socialism.
The Philadelphia Ledger recently celebrated
its seventieth anniversary. It observed the event
by reproducing a fac simile of the first issue, and
iq it appeared the following familiar paragraph:
"Congress seems determined to fritter away its
time instead of rendering it profitable to the na
tion." The old sage who remarked that "history
repeats itself" had a head so long he was forced
to go outdoors to turn around.
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