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About The commoner. (Lincoln, Neb.) 1901-1923 | View Entire Issue (Dec. 6, 1907)
s DECEMBER 6, 1907 r. The Commoner. 7 6- 'S . ehorter hours for their .employes. Thoreforo, while there must be just and -reasonable regula tion of rates, wo should be the first to protest against any arbitrary and unthinking movement to cut them down without the fullest and most careful consideration of all interests concorned and of the actual needs of the situation. Only a special body of men acting for the national government under authority conferred upon it by the congress is competent to pass judgment on such a matter. Those who fear, from any reason, the exten sion of federal activity will do well to study the history not only of the national banking act but of the pure food law, and notably the meat inspection law recently enacted. The pure food law was opposed so violently that its pas sage was delayed for a decade; yet it lias worked unmixed and Immediate good. The meat in spection law was even more violently assailed; and the same men who now denounce the atti tude of the national government in seeking to oversee and control the workings of interstate common carriers anil business'concerns, then as serted that we were "discrediting and ruining a great American industry." Two years have not elapsed, and already it has become evident that the great benefit the law confers upon the public is accompanied by an equal benefit to the rep utable packing establishments. The latter are better off under the law than they were without it. The benefit to interstate common carriers and business concerns from the legislation I advocate would' be equally marked. PURE FOOD LAW Incidentally, In the passage of the pure food law the action of the various state fqod and dairy commissioners showed in striking fashion how much good for the whole people re sults from the hearty co-operation of the fed eral and state officials in securing a given rer form,. It is primarily to the action of these state commissioners that we owe the enactment of this law; for they aroused the people, first to demand the enactment and enforcement of state laws on the subject, and then the enact ment of the federal law, without which the state laws were largely ineffective. There must be the closest ca-operation between the national and, state governments in administering these laws., . ,...,. CURRENCY In my message to the congress a year ago I spoke as follows' of the currency:, "I especially call your attention to the con dition, of our currency laws. The national bank act has ably served a great purpose in aiding the enormous business development of the coun try, and within ten years there has been an in crease in circulation per capita from $21.41 to -$33. Q8. For several years evidence has been accumulating that additional legislation is need ed. The recurrence of each crop season empha sizes the defects of the present laws. There must soon be a revision of them, because to leave them as they are means to incur liability of business disaster. Since your body adjourned there has been a fluctuation in the interest on call money from two per cent to thirty per cent, and the fluctuation was even greater during the preceding six. months. The secretary of the treasury had to step in and by wise action put a stop to the most violent period of oscillation. Even worse than such fluctuation Is the advance in commercial rates and the uncertainty felt in the sufficiency of credit even at high rates. All commercial interests suffer during each crop period. Excessive rates for call money in New York attract money from the Interior banks Into the speculative field. This depletes the fund that would otherwise be available for commer cial uses, and commercial borrowers are forced to pay abnormal rates, so that each fall a tax, in the shape of increased interest charges, is placed on the whole commerce of the country. "" "The mere statement of these facts shows thai pur present system is seriously defective. There is need of a change. Unfortunately, how ever, many of the proposed changes must be "ruled from consideration because thoy are complicated,- are not- easy of comprehension, .and tend to disturb existing rights and interests. We must also rule out any plan which would materially impair the value of the United States two per cent bonds now pledged to secure cir culation, the Issue of which was made under conditions peculiarly creditable to the treasury. I do not press any especial plan. "Various plans have recently been proposed hy expert commit tees ot bankers. Among the plans which are possibly feasible and which certainly should re ceive your consideration Is that ropoatcdly brought to your attention by tho present secre tary of tho treasury, tho essential foatures of which have been approved by many prominent bankers and business men. According to this plan national banks should bo permitted to Issue a specified proportion of their capital In notes of a given kind, the Issue to bo taxed at so high a rate as to drive the notes back when not want ed in legitimate trade. This plan would not permit the issue of currency to give banks addi tional profits, but to meet tho emergency pre sented by times of stringency. "I do not say that this is tho right system. I only advance It to emphasize my bollof that there Is need for tho adoption of some systom which shall be automatic and open to all sound banks, so as to avoid all possibility of discrim ination and favoritism. Such a plan would tend to prevent tho spasms of high money and specu lation which now obtain In tho New York mar ket; for at prosent tlfbro is too much currency at certain seasons of tho year, and its accumu lation at Now York tempts bankers to lend It at low rates for speculative purposes; whereas at other times when tho crops are being moved there Is urgent need for a largo but temporary Increase in the currency supply. It must never bo forgotten that this question concerns busi ness men generally quite as much as bankers; especially Is this truo of stockmen, farmers, aud business men in tho west; for at prosent at certain seasons of the year the difference in in terest rates between tho east and tho wcBt Is from six to ten per cent, whereas in Canada the corresponding difference Is but two pir cent. Any plan must, of course, guard the interests of western and southern bankers as carefully as it guards tho Interests of New York or Chicago bankers, and must bo drawn from tho stand points of the farmer and the merchant no less than from tho standpoint of the city banker and the country banker." I again urge on the congross the need of immediate attention to this matter. Wo need a greater elasticity In our currency; provided, of course, that we recognize the even greater need of a safe and secure currency. Thorc must always be the most rigid examination by tho national authorities. Provision should bo mado for an emergency currency. The emergency Is sue should, of course, be made with an effective guaranty, and upon conditions carefully pre scribed by tho government. Such ernorgency issue must be based on adequate securities ap proved by the government, and must be Issued under a heavy tax. This would permit currency being Issued when the demand for It was urgent, while securing Its retirement as the demand fell off. It Is worth investigating to determine whether officers and directors of national banks should ever bo allowed to loan to themselves. Trust companies should bo subject to tho same supervision as banks; legislation to this effect should be enacted for the District of Columbia and tho territories. Yet we must also remember that even the wisest legislation on the subject can only ac complish a certain amount. No legislation can by any possibility guarantee the business com munity against the results of speculative folly any more than It can guarantee an Individual against tho results of his extravagance. When an Individual mortgages his house to buy an automobile ho invites disaster; and when wealthy men, or men who pose as such, or are unscrupulously or foolishly eager to become such, indulge in reckless speculation espe cially if It Is accompanied by dishonesty they Jeopardize not only their own future but the future of all their Innocent fellow-citizens, for they expose the whole business community to panic and distress. . THE TARIFF This country is definitely committed to the protective system and any effort to uproot It could not but cause widespread Industrial dis aster. In other words, the principle of- the present tariff law could not with wisdom be changed. But in a country of such phenomenal growth as ours it Is probably well that eye.ry dozen years or so the tariff laws should be care fully scrutinized so as to see that no excessive or improper benefits are conferred thereby, that proper revenue is provided, and that our foreign trade Is encouraged. There must always bo as a minimum a tariff whjph will not only allow for the collection of an ample revenue but which will at least make good the difference in cost of production here and abroad; that is, the dlf ferenqe in the labor cost here and abroad, for the well-being o'f the wageworker must evervbe a cardinal point of American policy. The ques tion should bo nppronchod purely from a busl noun standpoint; both tho time and tho manner of tho chango being such as to arouse the mini mum of agitation and disturbance In the busi ness world, and to give the loast play for selfish and factional motives. Tho solo consideration should be to see that tho sum total of changes roproHont tho public good. This moans that tho subject can not with window be dealt with In tho year procodlng a presidential election, bo causo as a matter of fact cxporlonco has conclu o yoly shown thnt at such a tlmo it Is Impos sible to got men to treat It from the standpoint of tho public good. In my Judgment tho wlso tlmo to deal with tho matter Is Immediately aftor such election. f (Continued on Page M) WASH I.N GT OX LETTISH 4& Washington, IX C, Docomber 2. Tho vig orous criticisms, oxprosHod ,or Implied, made within two days by a Justice of tho supromo court of tho United States, Mr. Justice Brewer, and by former Senator Spooncr upon tho attitude and tho actions of President Roosevelt aro to day Uio talk of all Washington. Justlco Brewer based his criticism upon the eligibility of tho president for a socond torm, and said that If he were declared Ineligible wo would not now havo "tho spectaclo of a presi dent playing hide and seek in politics." Senator Spoonor followed tho noxt day with this asser tion: "It was not tho federal govorrfment came to the aid of tho country during tho crisis encountered, but a few days ago. It was the financial leadors who took tho burden on their shoulders and they were lod by tho uncrowned king of them all, J. Plornont Morgan. Never in tho history of this country has tho standard of business mon been hlghor or puror than to day." Continuing Sonator Spoonor snoorod at tho Roosovolt assertion that tho administration und the treasury had saved the day In Wall Street, lie applauded Secretary Cortolyou for posses sing the gift of silence, "which I havo begun to think Is a very Important gift in a public official. It gives him tlmo to think." This Is regarded In Washington as a distinct slur upon bur some what voluble, not to say vociferous, president. With him, as a statesman of my acquaintance remarked today, thero is always time to spnk, the time to think comes afterwards. In a letter which I sent out yesterday I outllnod Mr. Bryan's plan for tho correction of tho admitted evils of the prosent currency sys tom. J havo learned today that at loast three members of congress aro preparing bills to be Introduced In the first week of the session to give it offect. It must bo admitted that tho chance of the enactment ot any of these bills Is a slender ono. Some sort of currency legislation will be pressed vigorously upon congress as soon as It meets. The banks would llko to purih through what Is known as tho asset currency law. Tho opposition to this among the people is so great that there is no chance whatsoever of its pass ago, but it will havo enough support, both politi cally and financially, to mako of it a sorfbug obstacle to tho passago of any other measure. Possibly the serious state of banking- crcdfUrn ho United States might force congress to act upon any measure except that of asset currency, that one never can be passed. Tho president's plan for correcting the t financial difficulty of the business world by fell ing bonds and certificates of Indebtedness 'ha been received with very faint pralso by banker and public men. Coincldently with ItB announce ment I saw a paragraph written by a mere flip pant humorist who probably did not think him self that he knew anything of the Currency question. He was commenting upon the state ment of Harry Payne Whitney who said that he had mortgaged his Fifth Avenue house for $500,000, not because he was hard.up, but be cause he didn't want to draw that amount of money out of the banks ia. which he was a de positor and thereby add to the financial strin gency. -' ' "Where did Mr. Whitney get the money that ho borrowed?" said the paragraphed "Did he meet some man on the street who Just took $500,000 out of his own pocket and handed It over'" ' If the banks buy $100,000,000 worth of three per cent, certificates, where is the money coming from? It will only lessen their reserve and by so-doing certainly not increase the con fidence .of (depositors. ,,.." " WILLIS J. ABBOT. i 4 1 5 I V Si i A , aid' if. ) o 'iH J