BANKERS GET THEIRS WHILE GETTING IS GOOD

Nye, Gerald P.

Bankers Get Theirs While Getting is Good A Story of What the Banking Monopoly Did in 1920 to "Earn" the New Federal Reserve Charter Granted in the Banking Bill By GERALD P. NYE (U. S. Senator...

...FTeely did the farmer buy of these bonds...
...For the people now have lost their greatest weapon for use in chastising unfair administration of the system...
...The greatest despot in all history would turn green with envy of those who exercise the power over our money and credit in America today...
...That alone ought to have been enough of a grant to be asked in any one bill...
...The very bottom was knocked front under the farm people...
...What was this plague...
...advance of the expiration of its old charter...
...Billions of dollars were borrowed for this purpose...
...More wool...
...Wlhat they wanted stuck, seemingly, to the flesh immediately the two came in contact, indicating that the secret hi success lay in a proper application of some substance or other to the fingers before reaching...
...The deflationists would not pay more than that for them and the farmer had to be satisfied with that, for he was being forced to liquidate and "get back to normalcy...
...These farm people awoke, not long after the 13th day of May, 1920, to discover that their lands, their flocks, their herds and the products of the land and their toil, had been smifc...
...On May 18, 1920, according to the minutes of the secret meeting of the Federal Reserve Board and the Advisory Council held at Washington on that day, Governor Harding of the board announced the intention of the system tightening up on credit, demanding repayment of loans and hastening liquidation of indebtedness, and then cautioned the meeting in this language: "I would suggest, gentlemen, that you he careful not to give out anything about any discussion of discount rates...
...This program, called for the liquidation of debts...
...Can America give absolute control over banking, money and credit into the hands of a few men and then expect its people to prosper...
...It was Federal Reserve credit which made it possible for the farmer to follow the patriotic urge within him to enlarge upon his farming operations, possess more land, buy more machinery and engage that added help needed to produce that great abundance of food for which our government and our flag were pleading...
...How long has that claim held water...
...If -the country is in the midst of a wave of prosperity the opposition will be slight...
...Other giant incomes betokened an enormous increase in the number of high salaried men, and of persons who sold big property and security holdings at high prices, according to experts...
...it cannot come from abroad...
...And these coffers were filled to overflowing...
...So then, now, when we live in an age of imaginary prosperity, now is the time to renew the charter, even though the old will not expire until 1933...
...This further provision granted a perpetual charter to the Federal Reserve system...
...ten as if by some terrible plague, reducing their values to a mere fraction of what they were prior to that approximate date...
...In the debate on the banking bill in the Senate I remarked that there never had been quite so brazen, quite so wicked, quite so vicious, quite so hellish, quite so shameful an attack upon an unsuspecting people and upon the confidence of these people in their government...
...So, to meet his obligations, the farmer, after disposing of his valueless products, sacrificed equities he held in lands bought during the-war...
...banking monopoly seeking the privilege of branch banking jn every state of the Union...
...This little Speech of enlightenment can be found on page 9293 of the Congressional Record of May 21, 1924...
...This demolishes another all-time record...
...Experts estimated the number of new real millionaires at about 1,000...
...Do it now before the people demand regulatory legislation in return for a new charter...
...Hardly...
...Someone contemplated last February, while the McFadden banking bill so much desired by the Wall Street pets of political parties was under consideration, that if the spirit of Andrew Jackson were hovering about the halls of congress it must have been writhing...
...But it has still greater power, which is observable from a study of what took place at the expressed wish of the administration of the Federal Reserve system following the war...
...Credit was not obtainable with which to meet the demands made upon them, because the Federal Reserve had tightened tip on credit...
...But instead of doing that which the record of the bank so plainly disclosed ought to be done, instead of warding against a repetition of that wicked 1920 program, congress steps out and presents the money monopoly with a recbarter of the Federal Reserve system seven years in Millionaires Grow Like Weeds PROSPERITY and deep slashes in taxes have produced the greatest crop of "millionaire incomes" ever known, income tax figures made public by the bureau of internal revenue disclosed...
...Do it now and take no chances on the people making an issue of the recharter program a few years later...
...The answer is to be found in an arti-cle by him published in The Nation's Business for May, 1926: "A political attack against the Federal Reserve System must be expected when the time comes for renewal of its charter...
...Perhaps all this will enable the farmer to understand why he was encouraged to continue his heavy production activities after the war...
...For many of them the "Nelson Cure" was the last resort...
...That was the scheme...
...I answer, if it ever reach us it must spring up amongst us...
...To liquidate debts the people sacrificed their bonds, which they had bought, more often than not, with borrowed money npon which they paid interest...
...VU^'ll they wanted and then lost their ICfMp grip, and nearly lost their fingers ^^T, II in the machine too...
...On the surface it appeared to be a bill to tegulate branch banking...
...Does Record Deserve Rechartering...
...It is interesting to note, however, that earlier in the same meeting Governor Harding had given his secret listeners to understand what they all as bankers could do to help bring about a state of normalcy again...
...To control the machinery of money and credit is to control by far the most essential feature of our economic life...
...It is hardly so bright a page in the economic and political history of the people of America, for the success of this measure can be said to bf an invitation extended by the people, through the|- representatives in congress, to the banking monopoly to come and feed at will upon the blood of the nation...
...Passage of the bill by the senate would constitute assurance that the game of the Wall Street crowd of international bankers could go along unmolested and that the banking monopoly would he placed in a stronger position to still more tightly fasten its fangs into the flesh of the American people and nation...
...We are confronted with the ancient debate concerning the wisdom of a powerful central banking system...
...He was caused to damp his whole product upon the market in anything but an orderly marketing manner...
...What more legitimate industry is there than that of agriculture...
...To help secure its passage back in 1913 the authors of the Federal Re.scrve Act declared that the system would provide ample and elastic currency, such that there never again would be scarcity of money for legitimate purposes...
...One docs not need go further Into a study of those minutes of that secret meeting to observe that here it was that the plot was laid and arrangements made for the deflation program...
...And today these same influences preach that the difficulty confronting agriculture is purely one of over-production...
...Instead, it has proven an institution which, when "properly" administered, takes the last vestige of control from the people and places it in the hands of selfish interests who use it to further pauperize the people and enrich themselves...
...Then, to demonstrate how easy the process really was,—the process of getting what you want in a legislative way,—the Wall street bankers merely stuck in their thumb and pulled out a great juicy plum...
...Miarket quotations for liberty loan bonds were at eighty and eighty-five cents on the dollar...
...But, to accept the vote of congress on the banking bill as being the voice of the people one must conclude that the people are almost unanimously in favor of granting continued and greater power to the system and the money monopoly, for when congress ought to have been restricting it was, instead, extending opportunities to the giants of finance who play with the wealth ol the people...
...Then, as was the case in thousands of instances, away went the equity in the old homestead and other lands the farmer possessed prior to the war...
...They joined the three who have heretofore monopolized that ultra-exclusive sphere, raising its membership to seven...
...Then, the Axe For Patriots rlUS we see how the Federal Reserve can function to advantage in time of emer...
...This was at a time which found the Federal Reserve very,much in existence too...
...Mellon Explains Why WHY this rush for a new charter when it could not be needed before the expiration of the old in 1933 ? Secretary Mellon answers...
...Turning Billions to Trillions AN EARLY March issue of the Wall Street Journal is authority for the statement that if all the gold in Amexica were in the control of the Federal Reserve banks, those banks' could stretch that four and one-half billions of dollars of gold to a circulating credit of over twelve trillion dollars...
...Million a year men" grew like weeds, their number increasing from seventy-five in 1924 to 207...
...Yet the farmer knows today that the Federal Reserve Act has fallen short of measuring up to the claims made in its behalf when its passage was sought...
...But surely here was a value which deflation could not touch —'¦ these bonds that were "as good or better than gold...
...There ought to be a withdrawal of some of those powers by congress...
...What of Suicide Nationally...
...PERHAPS those of us who opposed the Me* Fadden banking bill are completely out of step with the people and the times...
...gency...
...The board caused the Federal Reserve system to be the channel through which the values held by the people should be turned Into the coffers of the money monopoly...
...Bank Bill Passes Easily BY AN overwhelming vote the senate showed itself possessed of a most remarkable constitution...
...Vote cloture so that senate debate will not awaken the people to what is being done...
...If destruction is to be our lot me must ourselves be its author and finisher...
...If they desire, and some folks think they do, to do again what they did in 1920 they can do so at their will and be not at all concerned about the winning of a recharter...
...But it is the provision of renewal of the Federal Reserve charter which will mark the biU in history, even though that provision was overshadowed by general propaganda in support of the bill, and even though that feature was covered up by the title of the bill itself...
...So all-powerful is this Federal Reserve board that it can, over night, knock the very props out from under legitimate business, and it has been demonstrated that the board is sufficiently daring to do this very thing when the interests of greed can best be served by such action...
...This is the number whose incomes of $50,000 and over were believed to come entirely from investments...
...Land values, too, were destroy, ed by the inflation program...
...Because thousands of farmers were being forced by deflation to do the same thing, markets were destroyed...
...The bankers, ho said, could advise their patrons to "get their heads out of the clouds and get down to business, and let us save, produce, and let each do his part in a constructive and productive war...
...What is the McFadden Banking Bill...
...Behold the demonstration of the truth of this statement...
...To the farmer this demand to pay up meant an immediate turn-over of his products...
...It is said upon good authority that all the way from sixty to eighty-five per cent of the Liberty Loan bonds bought by the people during the war are now in the possession of Wall Street bankers...
...But fo^f my own part I look upon the passage of th* banking bill as just one more great step toward national suicide, Lincoln in an early address delivered at Springfield was contemplating possible national dangers and closed his address with these words: "At what point then is the approach of danger to be expected...
...History probably also discloses why the nenewal of its charter was shrouded in snch secrecy by the authors of the banking bill, why the senate should be gagged, why the bill should be passed with all possible speed...
...After voting cloture and gagging itself, that body swallowed the mess in one gulp, passed the banking bill with hardly a sign of discomfort...
...WfaS this plague what many claimed it to be, namely, but a condition which was to be expected following war...
...THE POWER in the hands of the Federal Reserve board has proven too great for our national welfare...
...Knowledge of that power in the hands of the Federal Reserve board coupled with the knowledge of what the system has done in late years ought to be sufficient to convince the public that this giant needs a bridle...
...Nor should we overlook the fact that it was Federal Reserve credit which made it possible for the farmer and others to borrow money which would enable him to do what he felt was a further patriotic duty and "buy untrt it hurt" of Liberty Bonds,-- those government "securities" which were, as we all preached, as good as gold...
...Its effectiveness will largely depend upon the particular phase of the business cycle which happens to prevail at that time...
...Indeed, they were better than gold, for the gold drew no interest...
...Yet I venture to guess that the spirit of Jackson and Lincoln, if they were hovering about, took some consolation in the attitude of those few who were, in reality, but declining to aid in a program of extending further powers to the money monopoly before that monopoly was caused to make some accounting of its activities, which had brought such great suffering to millions in the past, or before a halter had been placed upon the creature to aid in bringing it to its feet at times...
...Of the branch banking feature I shall not concern myself in this article, even though it in itself affords ample cause for objection to the bill as a whole...
...Everyone knew that the bGl would have no difficulty winning the approval of President Coolidge, since it already had won the approval of "Andy" Mellon...
...S. Senator from North Dakota) I IE FARMERS of America, reaching into the legislative hopper of congress last winter for a bit of help-' fnl legislation, got hold of what...
...Instead of regulating, it let down the bars which will permit the Invasion of many state leris1«fiir...
...Be the percentage what it may, the fact remains that following the deflation program, after the people had surrendered their bonds for eighty cents of the dollar, the market value of the bonds went back to par-plus...
...The scheme took well...
...But, lo and behold, they, too, were off their feet...
...System Dons Coat of Wolf SAD indeed is the story of the administration of this institution which was bom bearing a label signifying that it would forever make impossible more panics and give the people the more direct control over the agency of money and credit that was originally intended...
...All told there were 30,295 with these incomes of millionaire proportions, as'shown by the taxes paid last year on incomes received in 1925...
...Those who want to know the truth are quite awake now to the fact that this plague was a man-made panic destroying the values held by the farm people prior to 1920, and that it was visited upon the people, this plague, at the wicked and vicious will and bidding of a few men into whose hands, as members of the Federal Reserve board, has been placed the control over the economic life blood of the people, money and credit...
...One wonders if Senator Lodge had reference to this substance in particular when on the floor of the senate in 192-1 he declared that he was "putting it moderately when I say that nine-tenths of the money expended on behalf of the Republican and Democratic parties is raised in the city of New York...
...A few there were, it is true, who wo*ld not join in approval of this legislation, but they were, as some friends of the bill declared, "a no-account lot of twisted brains bent upon disagreeing merely for the sako of disagreeing...
...IT CONTAINED two very important features...
...More than 9,000 persons strode into the ranks of Americans boasting annual incomes of $50,000 and over during 1925...
...Which accounts for the appeal to the farmers following the war not to let up in their production...
...Four newcomers strode into Midaslike affluence in 1925, with annual incomes of $5,000,000 or more each...
...Credit For the Patriots LET US first carry in mind the truth that ¦J it was the Federal Reserve system which made credit so easy for the farmer and others during the war...
...Far too much power has been granted under the Reserve Act to a few men...
...Blood was called for by them and blood they got...
...Do it NOW with all possible speed and secrecy...
...The history of the administration of the Federal Reserve system during its life certainly discloses room for objection to its recharter without added regulatory reservations by congress...
...Was it a messenger from heaven heaping punishment upon the farmer for the part he had played in that terrible World War to make the world safe fas democracy...
...The House had accepted the bill as it came from conference and the Senate was preparing to swallow the mess...
...As a nation of freemen we must live through all time, or die by suicide...
...Take the works by storm...
...With the end of the war came the vicious, wicked deflation program with the wreck to agriculture which is still with us...
...The representatives of the people threw that weapon away last winter when they voted a new charter for the Federal Reserve...
...Without the aid of the Federal Reserve bank these robberies could not have taken place...
...The bill was brought to its last hurdle in the senate...
...Cannot Dodge Responsibility AMERE handful of men, clothed with authority granted by congress to the "Federal Reserve Board, can be thanked for the deflation program...
...They didn't even have to grip what they were after...
...The markets were glut* ted and the price of farm products all but destroyed...
...Only 21,081 were in this class in 1924...
...The story of that deflation program and more especially that liberty loan, bond steal which was a part of it, constitutes the blackest page in all American history...
...The power to expand is also the power to contract, remember...
...Another Dark Page in History THE passage of the banking bill doubtless constitutes one of the brightest pages in the history of the big bankers of the world...
...But it contained a further grant, nicely tucked away where it would be least apt to attract attention...
...On such a market it was not reasonable to expect that the farmer could realize enough to enable him to meet the extensive debt which the government had urged him to shoulder during the war...
...The System and The Farmer FARMERS of America, thousands upon thousands of them, owners of millions of acres of fruitful lands and great flocks and herds, in 1920 could not find money needed to carry on and finance in a businesslike manner their very necessary, to say nothing of legitimate, operations...
...By virtue of the passage of the banking bill in February, Federal Reserve officials have the life of their machinery insured for long years to come...
...Blackest Page in American History BUT the saddest tale of all is that concerning the departure of the Liberty Loan bonds from the people into the hands of the deflationists...

Vol. 19 • April 1927 • No. 4


 
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