The History of Banking Fraud:
Chapter 12
SENATE VOTES FOR REPEAL
The Coming Battle
By M. W. WALBERT, 1899
384
"I believe in the people, in universal suffrage as fitted to secure the
best results that human nature leaves possible If corruption seems rolling
over us like a flood, it is not the corruption of the humbler classes - it
is millionaires, who steal banks, mills and railways; it is defaulters,
who live in palaces and make away with millions; it is money kings, who
buy up Congress; it is the demagogues and editors in purple and fine linen
who bid $5o,ooo for the presidency itself."- Wendell Phillips.
While this great debate was taking place in the House, the turmoil in. the
business dries throughout the United States was beyond the powers of
description. Hundreds of great failures were occurring, including banks as
well as other lines of business.
The colossal credit system, which had been built up by the national
banking money power, fell with a crash that shook the business interests
of the nation from one end to the other.
The juggernaut which the New York bankers had sent forth to trample down
the business of the country in order to influence Congress, had got beyond
the control of those lawless financiers who had assailed the credit of the
nation, and who had destroyed the property rights of tens of thousands.
The concerted cry of "want of confidence" in the ability of the Government
to redeem its obligations, returned, with ten-fold force, to assail the
very national banks which had originated that false and delusive rumor.
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Thousands of depositors immediately withdrew their money from the banks,
aggravating the distress then prevalent.
That the rumors set afloat by the banks, attacking the credit of the
Government, did not impair the confidence of the depositors in its
financial ability is demonstrated to a certainty.
Greenbacks, treasury notes, silver, and silver certificates, were taken
with avidity by the withdrawing depositors and hoarded. Gold was not
demanded.
In a short time, the New York banks were unable to pay their depositors,
and they, in common with the banks of Boston and Philadelphia, issued
clearing house certificates to the amount of $63,ooo,ooo, which were used
to pay their depositors in lieu of money.
This act of the associated banks of the East, in issuing these
certificates, was a clear violation of the law which assessed a tax of ten
per cent., upon State bank notes, and all other paper designed to
circulate as money except national bank notes.
The very banking power, which had demanded and secured the passage of that
law, was the first who violated its provisions.
Besides these lawless acts, the New York banks refused to cash the checks
of their depositors, and charged a premium of three per cent. for paying
out the money which they owed to the public.
In the meantime, the money brokers of New York were charging enormous
rates of interest, and were selling money at a premium ranging from three
to seven per cent.
The Washington Post is authority for the statement that one firm of money
brokers in New York City
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made a profit of $6oo,ooo by selling currency at a premium.
A financial writer of New York City stated that Russell Sage made a daily
profit of twenty thousand dollars by loaning money at an enormous rate of
interest during the panic.
As proof of the foregoing facts, a New York banking house issued the
following circular letter August 18th: -
"The New York City banters have $37,38o,ooo certificates outstanding.
Boston has $11,1oo,ooo. Other bankers in the South and West perhaps have
enough more out to make fifty millions of bank certificates. Adding these
various amounts together, we find a possible increase of about one hundred
millions since July 1 to replace the unknown amount of currency and gold
drawn out of the banks and hoarded in vaults and other places since May
last; "Where it resembled the one talent more than the ten talents."
"Currency commands three per cent. premium, and has sold as high as five
per cent. Exchange on this city from many Western cities has recently
ranged from five to fifty dollars per $1,ooo. Many Western people claim
the degree of credit desired by Eastern bankers is shown by their
willingness to pay depositors. Eastern banks appear to have no sympathy
for Western methods in not issuing bank certificates. Many individuals
have sold their checks on the street for funds to meet maturing
obligations or mate needed purchases. Credit seems to have been strained
from here to the Pacific coast, and attacked on all sides and benefiting
but few."
The Mercantile National Bank of New York City was the only bank that did
not exact unlawful rates of interest.
Mr. St. John was at the head of this institution, and
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he would not permit this bank to practice the extortion in vogue at the
other banks.
When before the House Committee on Currency, in December, 1894, he
testified as follows:-
MR. HAUGEN: What rate of interest did you charge during the panic a year
ago?
MR. ST. JOHN: The Mercantile National Bank of New York never exacts more
than 5 per cent. from its dealers, under the present administration of
thirteen years. There was one instance during that panic of 1893 in which
we did exact 8 per cent, I think. We had been badly abused, and might have
exacted 20
per cent.
MR. HAUGEN: What was the current rate about?
MR. ST. JOHN: There was no current rate. Lenders got anything they chose
to exact.
MR. HAUGEN: It was much higher than it is now?
MR. ST. JOHN: Yes; brokers paid on prime security three-fourths per cent
per day and 5 per cent per annum; 276 per cent. per annum for some days.
MR. JOHNSON, of Indiana: Can you give us, in a succinct form, your
explanation as to how there can be a remedy for the high price of money in
the agricultural districts in crop-moving times?
MR. ST. JOHN: If there were a larger aggregate of money in the United
States it could circulate over our vast territory without occasioning
alarm. If I knew that the world believed that Louisville is absolutely
prosperous, I would like to lend much of my money in Louisville. I would
do so with the same certainty that I have mentioned as pertaining to New
York. I merely tale Louisville as the illustration, because you mention
it.
The statements of President St. John shows the extent of the panic in New
York City, and awards a view of the Shylock tactics practiced by the money
lords of the East.
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It has been asserted by competent authority, that while these banks were
refusing to pay out the funds due their tore, that this money was loaned
out by them through brokers at the rates of interest stated by Mr. St.
John, viz, 276 per centum.
Not only did the banks of New York City disobey the law by issuing
clearing house certificates, but the great elevator owners and flour
manufacturers of Minneapolis bought millions of bushels of wheat by paying
for it in certificates similar to those of New York City.
The clearing house of Birmingham, Ala., issued certificates for sums as
low as fifty cents.
The excuse tendered by the banks for not paying out money was, that the
depositors were frightened by "want of confidence," and that they, the
banks, had not the money to pay claims against them.
It was during this time of scarcity of money, that the Hon. Bourke Cockran
declared that the country was suffering from a redundancy of currency!
The unlawful acts of the New York banks became so notorious that, an the
22d of August, 1893, the following resolutions of inquiry were offered in
the Senate by Mr. Peffer:-
"Resolved, That the Secretary of the Treasury be directed to inform the
Senate -
"First, Whether, and in what respect, the national banks, or any of them,
in the cities of Boston, New York, and Philadelphia are being now
conducted in violation of law.
"Second, Whether said banks are paying depositors' checks promptly in
lawful money.
"Third, Whether said banks, or any of them, are demanding rates of
interest higher than those provided by law for the loan of money or in
discounting notes and bills."
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Immediately upon the appearance of this resolution, Senator McPherson, the
national bank sugar trust speculator, moved its reference to the Finance
Committee.
This was done for the purpose of smothering the resolution.
Senator Gorman apologized for the delinquent banks and asserted that, if
the Comptroller strictly enforced the law, many of these banks would be
compelled to close their doors. He argued that the banks were the best
Judges of what should be done in the case.
In reply to the remarks of Senators McPherson and Gorman, Senator Hill
said: -
"I am as anxious, sir, as the Senator from Maryland can possibly be to
relieve the financial distress of this country. I will go with him as far
as he will go in the effort to keep out partisanship in the disposition of
the financial question. From the hour we first met in this body my efforts
have been toward bringing about a proper solution of the question, and my
efforts have been just as zealous, just as earnest, as have been the
efforts of the Senator from Maryland. My position upon this great
financial question has not been misunderstood. I spoke upon this subject
last February when I thought I saw the danger coming to the country. I did
not hear the eloquent voices of some other gentlemen aiding me in that
contest.
"What is the precise question? Gentlemen do not understand one another
upon the other side of it. I thought I heard an intimation that there bad
been something wrong somewhere. I judged that much from the suggestion of
the Senator from Massachusetts. He disavowed any intention of saying that
there had been any wrong anywhere. Then the Senator from Maryland steps
forward and says, 'Yes; there has been a violation of the law, a conceded
violation of the law on the part of national banks, wrinkled at by
officials.'
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That is the idea we get from his remarks. I do not know whether that is
true or not. I think, whether it is true or not, it ought to be
investigated.
"What do you want to refer to this committee? Is it a committee of
investigation to investigate the acts of the Comptroller of the Currency?
- No. For what purpose is the resolution to be referred? As I understand
the Senator from Maryland, the only object of a reference to the committee
is for the purpose of not acting upon it, for the purpose of suppressing
it in the interest of the public welfare. That seems to be the idea. There
has never been a cause so bad in the history of the country that its
advocates have not always felt that they acted in the interest of the
public welfare.
"The resolution is a simple one. What is it? It simply asks the
Comptroller of the Currency to give us certain information in his
possession as to what has been done in his office, or by the national
banks of the country, so far as he understands what has been done. The
details of the resolution I do not propose to give. What is the objection
to it? Is it a proposition to try the Comptroller of the Currency? Is it a
proposition to arraign the national banks for a violation of their duty? -
No; it is a simple, ordinary and proper resolution; and I say courtesy to
the distinguished Senator from Kansas entitles the resolution to be passed
here and now. What reason can there be given against it?
"The Senator from Maryland says there are great times in the history of
the country when we must rise above partisanship. I agree with him. What
has that to do with this question? There are great times when we mast be
equal to the occasion. What has that to do with suppressing an ordinary
resolution of inquiry? The resolution does not provide for the appointment
of a committee to investigate anybody. The resolution does not provide for
making charges against anybody.
"Are you afraid of the facts? This very debate will cause inquiry into
what has been done. This debate in the Senate of the United States will
direct attention
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to the question, and every person will be apt to inquire to-morrow morning
what has been done by national banks, and what has been done by the
Comptroller of the Currency, that the Senate of the United States dare not
pass a simple, ordinary resolution of inquiry? What are you afraid of? Are
we not trying to quiet the existing panic? Is the panic to be quieted by
each proceedings as this? Are resolutions calling for information to be
suppressed, put down, shelved, put into a committee and there pigeonholed?
Can we not stand the light of day on this subject? Cannot the acts of our
officials, whoever they may be-and I myself make no charges against them
whatever - stand a simple inquiry?
"What will this committee do? The Senator from New Jersey says that the
committee will look into the matter, and the fair inference from his
remarks is that if they find anything wrong, they will not report the
resolution, but if they find everything has been right, then they will
report the resolution. Why can we not make that inquiry now? I appeal to
the Senators around this Chamber that there s no reasonable, tenable
objection that is presented why the resolution should not be passed. Why
should not the distinguished Senator from Kana' be treated the same as
every other member of this body? He has the same rights to offer a
resolution and have it passed.
"How long is it since a resolution of inquiry has been referred to a
committee before being allowed to pass? I have not heard it in the last
year and a half that I have been here. Therefore, I say to you, it is not
a question of patriotism. It is not a question as to what should be done
in this great hour of distress. It is a simple, ordinary question of
senatorial courtesy; and I have heard no reason yet presented why the
resolution of the Senator from Kansas should not be passed. I do not agree
with him in his peculiar notions of finance I do not belong to his party.
He has his own viewers upon these questions, but he has a right to have
any proper, legitimate information spread upon
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the records of the Senate, and there can be no objection to it."
Senator Washburn expressed his fears that the passage of the resolution
would dose almost every bank in the country, and place it in the hands of
a receiver. He said: -
"It seems to me if the resolution is passed and we receive the reply which
is inevitable, that it will be notice to the Comptroller of the Currency
to administer the law literally and technically; the result of which will
be to close almost every bank in the country and place it in the hands of
a receiver. That is a calamity which, it seems to me, we should loot
forward to with great hesitation. I do not believe it is the. duty of
patriotism, of party, or of good common sense to infect anything of that
kind into the present deplorable condition."
The Senator who made the above statement was a supporter of the national
banking system, and the remarque above quoted will exhibit the lawless
character of those men, who attacked the credit of the United States, and
who violated the laws of State and nation in almost every transaction in
which they were engaged.
Daring the debate on the motion to refer to the Finance Committee, Senator
Teller said: -
"The banks have another function, which is to transmit money from one bank
to another. Commerce can scarcely be carried on unless that function is in
active force. Business cannot be done between New Orleans and Chicago, New
Orleans and New York, and all around, unless bills of exchange can be
used. They are the agencies of commerce.
"Have these banks fulfilled that function? For more than six weeks the
banks of the city of New York, and other cities which I might mention,
have
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simply declined to pay drafts drawn on them by outside banks for the money
that those banks have on deposit. Between a city that is entered by at
least six railroad trains a day, and can be reached in twenty-four hours,
and the city of New York, the rates of exchange have been $3 on the
hundred; and between the city of New York and the sty of Philadelphia
there has been an absolute refusal on the part of the banks of
Philadelphia to pay drafts on the sty of New York in any kind of money.
"I have in my drawer here a letter from a Western banker, who tells me
that through his bank he had a draft of $7,ooo on a Philadelphia bank,
which he seat to a bank in the city of New York, and the bank there
returned it to him saying, `We will present no drafts to the banks of
Philadelphia, because they decline to pay.' Then, through other agencies,
this banker sent his draft to Philadelphia for money admitted to belong to
the drawer, and the banks of Philadelphia simply add: 'We cannot afford to
pay this, and we will not pay it.' "
Senator Butler added the following testimony to that adduced by Mr.
Teller. He said: -
"I would state one fact which comes within my own personal knowledge. I
met a gentleman on a train last night, who informed me that, as President
of a large manufacturing establishment in the South, he had deposited in
one of the banks of the city of New York a large amount of money, and had
telegraphed and written to that bank to send him $5,ooo of currency with
which to pay his laborers on Saturday night.
"Mr. Allison: A national bank?
"Mr. Butler: I am not prepared to say that it was a national bank - I do
not know about that - but it was one of the banks of the city of New York.
He said that that bank at first declined to do it, but finally sent him
$5,ooo in currency and charged him 1 1/2per cent. for sending him his own
money. I said to this gentleman, 'You certainly did not pay it?' 'Why,'
said
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he, 'I was obliged to pay it.' 'To pay 1 1/2 per cent. for sending you
your own money?' Yes, sir.' That is one instance. As has been stated by
some Senator, I believe that a check on a man's own deposit has to be
discounted at 3 per cent.
"I have heard a great deal about the want of confidence in the country,
brought about by the Sherman Act. The Sherman Act has about as much to do
with that want of confidence as a pebble in a millpond has to do with
stirring the waters. It is, unless we are all misinformed, a want of
honesty - and we may as well speak plainly - and the sooner the country
finds it out the better it will be for everybody."
These were but a few of the facts brought oat by the debate on this
resolution with reference to repeated violations of law, and of the mean
oppressions practiced upon the people by those lawless national bankers,
who had boasted that they would teach the people an "object lesson."
The resolution was finally referred to the Finance Committee, which
subsequently reported it back in a modified form and it was passed.
On September 16th, the Deputy Comptroller made a report in reply thereto,
in which he stated that the Comptroller had no official information that
the national banks of New York, Boston, and Philadelphia were violating
the law.
It will be noticed that the Comptroller himself did not reply to the
resolution, and secondly, that the resolution did not call for official
information. Furthermore, the sub-treasury in New York City was a member
of the Clearing House Association, and, as such, was cognizant of the
methods of the national banks composing that body.
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During this time, the Senate was debating the question of repealing the
purchasing clause of the Sherman law.
On August 25th, Senator Hill, of New York, strongly arraigned those men
who brought on the panic. He said: -
"Some portion of the present panic may be traced to a concerted effort on
the part of numerous monometallists to produce it, in order to further
discredit silver as a part of the standard money of the coin. That fact is
apparent everywhere we turn. We observe it in their senseless arguments
constantly used against free bi-metallic coinage and their ceaseless
endeavors to confuse the present issue by characterizing it as a contest
between monometallism and be-metallism. They seemed to be delighted when
the first ray of financial trouble appeared. They hailed the recent action
of India with ill-concealed satisfaction. They talked against silver,
morning, noon, and night.
They denounced, not simply the Sherman silver purchase bill, but the
future use of silver as money. With ghoulish glee they welcomed every bank
failure, especially in the silver States, little dreaming that such
failures would soon occur at their own doors. They encouraged the hoarding
of money, they inaugurated the policy of refusing loans to the people even
upon the best of security; they circulated false petitions, passed absurd
and alarming resolutions, predicted the direst disaster, attacked the
credit of the Government, sought to exact a premium upon currency, and
attempted in every way to spread distrust broadcast throughout the land.
"The best financial system in the world could not stand such an organized
and vicious attack upon it.
These disturbers-these promoters of the public peril - represent largely
the creditor class, the men who desire to appreciate the gold dollar in
order to subserve their own selfish interests, men who revel in hard
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times, men who drive harsh bargains with their fellow men in periods of
financial distress, and men wholly unfamiliar with the true principles of
monetary science.
"It is not strange that the present panic has been induced, intensified,
and protracted by reason of these malign influences. Having contributed
much to bring about the present exigency, these men are now utterly unable
to control it. They have sown to the wind, and we are all now reaping the
whirlwind together."
The courage of the New York Senator was grandly illustrated in this
speech, in which he points out the unlimited greed of those so-called
financiers, to whom nothing was sacred during their traitorous warfare
against the nation and the people.
One of the singular incidents, occurring during the struggle for repeal,
was that in which Senator Sherman became a conspicuous adviser of
President Cleveland and Secretary Carlisle!
The strange anomaly of this lifelong Republican becoming a warm supporter
of the financial policy of the administration is one of the wonders of
American politics.
On October 17th, Senator Sherman made the following prediction of the
astonishing benefits that would accrue from a repeal of the Sherman law.
He said:
"In the present condition of affairs there is no money to buy cotton and
corn and wheat for foreign consumption. Break down the barrier now
maintained by the Senate of the United States, check this viper called
obstruction to the will of the majority, give the Senate free power and
play, and in ten days from this time the skies will brighten, business
will resume its ordinary course, and the clouds that lower upon our house
will be in the deep bosom of the ocean buried."
Is it not remarkable that this man, who, for many
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years, has enjoyed the reputation of being one of the greatest of American
financiers, should influence Congress to enact the law of July 14 1890,
and then, within a period of three years, assert that a repeal thereof
would brighten the skies, cause the resumption of business, and bury the
clouds in the bosom of the ocean?
Under the rules of the Senate, the measure could not be forced through
that body as rapidly as the national banking power desired.
In this great debate upon the bill to repeal the purchasing cause of the
Sherman law, those Senators in favor of that measure persistantly urged as
a reason for repeal that a "flood of silver" threatened the financial
stability of the Government.
The absurdity of that line of argument is apparent, when reference is had
to the gold and silver production of the United States.
From 1792, up to and inclusive of 1892, the value of gold produced in this
country was $1,987,ooo,ooo, of silver only $1,146,869,ooo, excess of gold
over silver, $841,ooo,ooo.
Senator Teller challenged the gold monometallists to point out where this
"flood of silver" was stored up.
They feebly referred to India!
The New York Press indulged in a vicious tirade upon Senator Voorhees,
Chairman of the Finance Committee, taking him to task for what it called a
dereliction of duty in not forcing a vote upon the bill.
On August 26th, the New York Evening Post uttered the following implied
threats because the Sherman law was not repealed. It said: -
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"We hear a great many reports from Washington to the effect that the
Senate is firm against any repeal of the Silver Purchase law. We advise
the public to attach little importance to the state of mind which prevails
at the present moment in the Senate or among the senators' constituents.
The medicine of the silver crisis is still working and the pangs which it
produces mill be more acute as the time goes on. One calamity mill come
thundering after another until the only possible remedy is applied. Banks
will fail, railroads will default, manufactories will close, workingmen
will lose their situations, there will be a shortage of money for
crop-moving, affairs will grow steadily worse, until the mind cure is
effected. Senators may roar against capitalists till the crack of doom
without opening the pocketbook of one of them. In fact, the louder they
roar, the tighter will those pocketbooks be closed. Nor will the time ever
again come when money can be obtained with the customary ease so long as
that silver law stands unrepealed. Hence we repeat that the frame of mind
that the Senate may be in at the present time is no index of what it may
be two weeks hence. There is dynamite enough in the financial situation to
burst the Senate and both political parties."
The Philadelphia Press of the same date said: -
"The New York banks for several days have been endeavoring to bring a home
influence on United States Senators, to induce them to vote for the repeal
of the July silver 1am.
"To this end correspondents of the New York banks in the West and South
have been told that they need not expect to get money from New York until
the purchasing clause was repealed, and the Southern and Western bankers
have strongly urged to write to their senators and insist that they work
and vote for immediate repeal. This movement has given rise to the recent
feeling in New York that the silver majority in the Senate could be
overcome, as the influence of
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the banks of the metropolis, when concentrated on any object, is regarded
as invincible. There is a feeling that the strain is not as great as it
was, and improvement is hoped for. Some anxiety exists as to the action of
savings bank depositors when the thirty and sixty day limit expires next
month. The requirements of money for the crops will also be a potent
factor, but no one is disposed to contemplate future conditions,
especially if they are likely to be unpleasant."
These papers were organs of the national banks, and they spoke the
sentiment of that power.
On September 22d, the Daily Indicator, a financial paper of New York City,
published the following: -
"There are ominous rumors in the street that New York will again put the
screws on the Senate. Whether this is street talk or not remains to be
seen; but the hardening of the rate of sterling exchange st the time of
large merchandise exports and in the middle of our exporting season, looks
as if gold exports would be made to influence the silver lunatics here is
no question but that the banks of New York are still withholding money
from merchants, while possessing millions of idle cash, because of a tacit
arrangement not to unloose it until the Senate votes for repeal. Now, if
the gold exporting movement began, that would be another striking
occurrence on which to impinge public thought, and on which popular
argument could be based. There is one point lacking in any program of this
kind. The public have learned that the influence of the silver bill on
business has been overestimated. The predictions of those who have urged
that everything depended on repeal have not been verified. Indeed, much
that was said has been disproved by recent occurrences, and the feeling
that the influence of the law was wildly exaggerated for political effect
has spread at Washington and elsewhere. Exports of gold at this time might
emphasize this feeling and, rightly or wrongly, it would be said that the
gold went
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out at the behest of Wall street. Not an hour old be gained in the Senate
for the repeal cause by any such movement."
These are but a few of the many thousand bold utterances of the subsidized
press of the national banking money power, and they afford conclusive
evidence that the panic of 1893emanated from the concentrated money power
of the East.
If the foregoing are not evidence of the power of the New York banks to
destroy the business of the country, then no facts could ever be proven.
September 29th, the New York Tribune cautioned the bankers to refrain from
giving publicity to their threats. It said:-
"The Tribune trusts that bankers of this city will permit a suggestion
which is for their own as well as the public interest. Several of them ate
reported as having made particularly alarming statements regarding the
disasters which, they venture to predict, will follow a failure of the
Senate to the pending Silver Purchase repeal bill. Such statements are not
likely to do any whatever, bet are eminently calculated to do me harm. It
is not to be supposed that these influential bankers are deliberately
trying to get up another panic, with all its distressing consequences.
"They might well remember, however, that the remarks they are reported as
having made, might, in a certain contingency, prove extremely costly to
the banks and to the business men of this city.
"It is not as if there were any important end to be gained by such
alarming utterances. On the contrary, it is highly probable that the
urgency of New York bankers may go far to prejudice the very cause they
desire to aid, particularly with some members of the Senate from the West
and South whose support of the repeal bill is essential. Senators of the
United States
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ought to be far above more prejudice against a measure, because any worthy
body of citizens advocate it with peculiar zeal. That some Senators are
not is the unfortunate fact. The idea that a measure is passionately
desired by New York bankers, in the judgment of those who know the Senate
best, is apt to damage that measure more than it will help it. If bankers
of this city wish to do their utmost to assist the passage of the repeal
bill, they may find it wise not to talk vehemently for publication.
"It is a less important fact that sound business men are not by any means
agreed about the necessity of action on the silver question at this time."
The Tribune proceeds to warn the banks against expecting too much from the
repeal of the Sherman law. It said.: -
"There was such agreement some time ago, before the widespread disasters
which it was hoped to aver had come. But it is not so clear noir as it was
then supposed to be that a single act of legislation would unlock
countless hoards, and bring untold millions hither from England, and
restore confidence and set all the mills at work, Whether all these things
would have resulted at once is not the question. There have been many
thousand failures. More than seven hundred banks have failed with
liabilities amounting to more than $170,000,000. A considerable of the
manufacturing force of the whole country stopped operations. In many ways
the conditions have changed.
"One of the ablest bankers in this city, having charge of a very important
bank, recently remarked that it was no longer clear to him that repeal of
the silver act would accomplish what he had expected. Its anticipated
effect, he said, would have been largely sentimental, but it was no longer
possible to restore confidence entirely and instantly, as he had thought
it might be restored some months ago. What this banker thinks many other
sound businessmen are thinking.
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It does not seem to them wise any longer to hold out the idea that all our
fortunes in this great country must turn upon an event which is not
certain to take place. The repeal bill is, as we believe, a wise and
highly desirable measure. But it is hardly wise or desirable to stake the
future of all business upon the action or inaction of the Senate of the
United States."
In the meantime, the New York bankers were holding meetings, and
formulating plans to compel the Senate to act with more haste.
A New York special to the Washington Post, September 17th, contained the
following remarkable language: -
"New York, September 17th.
"In a group of bankers at the Union Club to-day, the sentiment was given
voice that the delay in the passage of the repeal bill had reached a point
that needed explanation. At the Manhattan Club, where the Democratic
bankers principally gather, almost the same idea was expressed, but
Senator Voorhees personally was held responsible. It was argued that the
Democratic caucus had done all it could, but that the Indiana Senator had
not lived up to the confidence reposed in him. The same assertion is made
more bluntly in the open street, and at the Windsor Hotel; the banking men
were talking this evening about the difficulty of understanding what
Voorhees was trying to gain by what was considered his too-considerate
treatment of the silver minority.
"Practically the same opinions are held by business men who have no
banking interests.
"The feeling here is that unless in a day or two Voorhees performs without
further delay what is considered his duty, of pressing for a vote, he must
find himself under the necessity of explaining what are his concealed
motives. 'Candidly,' said a banker of high standing to the Post
correspondent, 'we did not
403
expect repeal to have been accomplished by this time, but the celerity
with which the House passed the bill gave us reason to believe like speed
would follow in the Senate. We know the ways of Senators pretty well, and
we can understand some of the motives that seem to actuate Senator
Voorhees. But his refusal to come to New York and talk with us has
suggested wrong motives, and his weak stand against the aggression of the
silver Senators is more than we can fathom. What does it mean? I ask the
question because we must know. We have a right to know. If we are not
given satisfactory reasons for the delay, as we have not to this hour, we
cannot be blamed for believing that there is something behind it all. What
can be Senator Voorhees' personal interest in keeping back repeal? That's
what we'd like to know; for his political interests are to our minds not
enough to explain the strange delay.'
"This talk of other motives than politics behind the delay has gained
currency among certain bankers, but is rejected as unbelievable by others.
"
From the language of these bankers, it will be seen that they regarded
Congress as a mere servant of the money power, and that the Senator, or
Representative, who would not completely subject himself to their beck and
call was liable to incur their censure.
The Clearing House Association of New York City transmitted a circular to
various members of Congress, in which was detailed a financial plan
concocted by these financiers. It proposed that Congress enact a law
providing that, whenever the clearing houses of New York City, Boston,
Chicago, and other great cities, decide that the country is in a state of
panic, these associations could deposit securities with the Government
which would put up money for these great financial rings.
404
This is an example of the arrogant demands of the panic breeders, railway
wreckers, trust organizers, stock, and grain gamblers.
That these men presumed that they owned the fee simple of the United
States Government, is evident from an interview with a banker, published
by a New York paper. In substance it is as follows: -
It was rumored that the President and the Secretary of the Treasury had a
conference with reference to removing the ten per cent. tax on State bank
notes. A reporter requested the opinion of Mr. Simmons, President of a
great national bank of New York, upon the merits of the proposed measure.
Mr. Simmons replied as follows. He said:-
"Well I have not examined the proposition very closely, but do not think
that I would like it. However, there need not be any solicitude, because
the administration will not pass any financial legislation without
consulting us; hence there need be no anxiety on the part of the public
regarding the subject."
Another banker, on being interviewed by the reporter, stated that no
financial bill would pass which did not meet the approval of the bankers.
After a long debate in the Senate, the repeal bill was passed October 30,
1893. It was sent back to the House for concurrence, as the Senate had
added a few slight amendments to the House bill.
After a short debate the House concurred in the Senate amendments, and the
bill became a law November 1, 1893.
The effects of the panic, which was created by the national banking money
power to coerce Congress into repealing the purchasing clause of the
Sherman law, are beyond the descriptive powers of language.
405
The New York World, of August, 1893, published a list of great railway
companies whose bonds declined in value from ten to fifty-five percent.
These were gold bonds.
The decline of prices of agricultural products, since the repeal of the
purchasing clause, was greater than ever before known.
On June 1, 1893, wheat sold for 43 cents per bushel.
On October 31st, it brought 69 cents, a decrease of fourteen cents. We
quote New York prices.
The total loss on wheat to the farmers for the year 1893, was $70,000,000.
Cotton fell two and one-fourth cents per pound.
Other agricultural products fell at the same ratio.
It is safe to state that the loss on agricultural products, resulting from
the repeal of the Sherman law in the United States and the closing down of
the mints of India to the free coinage of silver, amounted to hundreds of
millions of dollars.
And yet the passage of that Repeal Act was procured on the false pretense
that prosperity would return to bless the people.
It was further stated that the repeal of the Sherman law was necessary to
prevent the exportation of gold from the United States. This was another
hypocritical plea to aid in the passage of the repeal, for, in a single
year after that act was consummated, one hundred and twenty millions of
dollars in gold were drawn out of the Treasury by that set of knaves who
had urged repeal as a means to protect the gold reserve.
The number of failures for the year 1893 loomed up to the portentous
figures of 15,242, with liabilities of $346,779,889.
406
The extent of suffering among the working classes cannot be estimated, all
of which was the direct result of the conspiracy organized by the national
banking money power, and which was executed by its minions throughout the
length and breadth of this land.
The New York Tribune estimated the shrinkage of value of all kinds of
property at ten billions of dollars during this panic, which it bad urged
the bankers to inflict upon the- people as an "object-lesson. "
Other competent writers estimate the shrinkage of values, in 1893 and
1894, at not less than twenty billions.
It was lamentable.
--------------------------------------------------------------------------------
To
Chapter 13
To the
Table of Contents
The world gets crazier and crazier everyday, doesn't it? The world that many
of us thought was there, isn't. The bottom has dropped out of everything. The
illusions have been revealed, we have found out who has been pulling the strings
behind the scenes. Millions have lost their jobs, have mortgage
problems, and
foreclosure. What can be done? Amazingly, we have been mislead. We have been
taught that we can control government by voting. The founder of the Rothschild
dynasty, Mayer Amschel Bauer, told the secret of controlling the government
of a nation over 200 years ago. He said, "Permit
me to issue and control the money of a nation and I care not who makes its
laws." Get
the picture? Your freedom hinges first on the nation's banks and money system.
It's all about 'commerce'. Freedom is connected with Debt Elimination for
each individual. Not only does this end
personal debt, it places the people first in line
as creditors to the National Debt ahead of the banks. They don't wish for
you to know this. It has to do with recognizing WHO you really are in A
New Beginning: A Practical Course in Miracles, an informational study. Is
your credit rating bad for reasons that seem out of your control? There are
ways of credit repair,
so you can men those broken fences too. Do you want to keep your children protected
from outside forces, there are ways of protecting
your children. Do you want
to keep your sons and daughters free from 'the draft'? Check this out.
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