THE ROLL CALL

The Roll Call ON MEN AND MEASURES "Fixing" The Postal Bank Bill THE postal savings bank law recently enacted by Congress, is being heralded to the country as a redemption of the promise of the...

...In the course of the campaign, when this plank in the platform was cited it was commonly amplified by reference to the bill pending in the Senate and about to be passed...
...Details were perfected...
...The 4th of March, 1909, ushered in a new administration...
...not even an appeal from the decision of the Chair was to be permitted...
...Forthwith Dalzell reported from the Committee on Rules a special rule for its consideration...
...Clark, Wyo...
...no effort to perfect the bill would be allowed...
...The time for action through its agents in the Senate was at hand...
...Where the Senate bill had provided that every money order postoffice in the country should be a postal depository, the House bill opened wide the door of importunity and influence and favoritism, by leaving to the board of trustees the designation of suck postoffices as the board might select to be postal savings banks...
...If Would you abolish poverty...
...And the House took it...
...Their amendments in the public interest were voted down...
...Its author was one of the most "regular" of the Senate "Regulars...
...None of them have been convincing...
...On the floor this proviso was further amended to preclude any favoritism, by providing that the interest rate should be uniform throughout the country and not higher than was necessary to repay the Government the two per cent, interest paid to postal savings depositors and the expenses and losses of conducting the business...
...But let them not offer in explanation the excuse that Ccngress was about to adjourn...
...The Senate had declared, after weeks of deliberation, flatly against it...
...Those who offer this apclogy for the postal bank law will be reminded that even in the absence of express contract or platform pledges, there still subsists in this country an obligation resting upon all public servants in their conduct of the public business—an obligation which the people have not forgotten, though their representatives in Congress may have—that they shall serve the country, not Special Interests...
...It is fair, under all the circumstances, to incorporate into the party promise the general principles of that bill, both as to the establishment of a postal bank and the disposition of postal savings deposits...
...An amendment by Cummins, practically identical with the Borah amendment agreed to in the Senate bill to forbid the investment of postal savings funds in government bonds bearing less than two and one-quarter per cent, interest, was rejected by a vote of 22 to 37, and 23 not voting...
...Where the Senate bill repudiated the centralization op savings bank funds in the money centers, and by its terms precluded their investment in two per cent...
...The rule was agreed to and the bill was passed accordingly...
...At another point in the discussion he made it plain that only "if all the banks in the State declined the deposit" could any of the money be invested in securities...
...So advocated, its popularity extended to and embraced the great mass of citizens...
...About the time that Insurgency wanes, Vice President Sherman to the contrary notwithstanding, Cannonism will have disappeared eff the face of the earth.—New York Press, * * * ¶This progressive plan of "letting experts make the tariff" does not refer to the kind of experts that have been making the tariff heretofore.—Kansas City Star...
...Their duty was to pass such a measure, yielding to puch fair compromise on details as might be necessary...
...He gathered together the shreds of events and of the evidence—a little forgotten amendment which Root had printed weeks before to require the investment of the postal bank funds in Government bonds—the Taft Milwaukee speech urging legislation "to take care of the two per cents...
...Other amendments in accord with the policies which had been declared in the Senate bill were in like manner rejected by the Senate, and the House bill was agreed to...
...Then followed a special session of Congress and the revision of the tariff...
...He even went so far as to declare, in effect, that if he felt the power conferred by his amendment, to purchase bonds with the savings bank funds would be exercised, he would not offer the amendment...
...It had issued its ultimatum...
...Advocated for the people the postal savings bank became identified in the public mind as a popular institution—something for the people...
...But the faith must be kept with the System...
...A Republican caucus was called in the House for its consideration...
...You 've grown a tot since I went away...
...It was not until after the election, until after the next session of Congress had convened, until after the record of that session—a record of dalliance, delay and delinquency—was about completed, that the country was given to understand that it was not, and perhaps never had been, the purpose of the Senate management to allow a postal bank bill to become a law...
...The history of conference legislation between the two Houses supports the claim that the Senate is most insistent and most successful in conference...
...In the Senate the usual procedure would be, as on all important measures, for the Senator in charge of the bill to move that the senate disagree with the house amendment and ask for a conference to adjust the differences between the two Houses.—The House bill differed radically in every important essential from the measure which the Senate had passed...
...A conference ordered, and a few days of honest effort, would have secured an honest bill...
...And the System found a way—a devious way, to be sure, and subtle—but a way nevertheless...
...The "leaders" decided that it would be unwise to offer the Root amendment, but a substitute was offered by Smoot, drawn to accomplish the same purpose but in less obvious terms...
...Meanwhile there were those, particularly in the House, mindful of the coming election, mindful of what answer they should make to their people for their failure to fulfill their platform promises...
...There was no law requiring Congress to adjourn...
...The united protests of progressive and independent Congressmen were scarcely heard in the caucus above the din of the System machine...
...The Senate surrendered— not to the House, but to the Sy'stem...
...The following is a list of Senators who voted on March 5 for the Borah amendment to the Senate bill and voted on June 21 against the same amendment offered by Cummins to the House bill...
...The word was given out that there was opposition to the Senate bill from certain quarters so powerful and so unalterable that it was doubtful whether any postal savings bank bill could be passed at all...
...never was it advocated as a means of "taking care of" the government two per cent...
...The task before the System managers was not a simple one...
...In order that all banks in all communities might be on an equal footing to receive postal savings bank funds on deposit, it was provided that they might give indemnity bonds or deposit collateral as security to the Government for the repayment of the deposits received...
...Freely on all hands, among "regulars" as well as "insurgents," it was predicted that the public dissatisfaction with the tariff law might in the coming election deprive the Republican Party of a majority in Congress...
...The postal bank bill was allowed to lie as a thing dead for nearly three months in the House committee to which it was referred...
...It was announced that he would speak his views in the Senate...
...It had been announced that Senator Aldrich had concluded that we should have a central bank of issue which would afford a centralized control of the money supply of the country and exercire the function of issuing circulating bank notes...
...The protests of progressive Senators through whose efforts the public interests had been safeguarded in the passage of the Senate bill were in vain...
...An amendment by Senator Cummins, to require the board of trustees to designate postoffice depositories by a rule to be uniform throughout the country, was rejected by a vote of 28 to 34, and 30 not voting...
...It was designed that this depository system should not be used or available for the impoverishment of the currency in any locality but rather to strengthen it...
...The rumor was disseminated about the Capitol that Senator Root, of New York and Wall Street, had been impelled, reluctantly, to the conclusion that the postal bank bill, with the Smoot amendment in it, was perhaps unconstitutional...
...Needless to say it would have been repudiated and rejected by the people...
...An amendment by Senator Bacon, to strike out the House provision for the purchase of government bends, was rejected by a vote of 24 to 34, and 34 not voting...
...And every difference was in derogation of the public interest—in derogation of what the Senate in weeks of deliberation had emphatically declared to be the public interest in this legislation...
...The discussion of the bill proceeded harmoniously, day by day...
...The refusal must extend to the State or Territory—* * *." Senator Smoot raised the contention that the restrictions provided in the bill as reported were not drawn with sufficient certainty and that it might be construed to allow the board of trustees to invest savings bank funds in Government bonds...
...The absence of an express promise to legislate for the disposition of the deposited funds to promote the legitimate business needs of the people of the community where they are owned is construed to justify a disposition to promote the schemes of System finance...
...E. Russell...
...Careful planning and skillful management were necessary...
...Its plans were made...
...Thereupon," said the rule, "the previous question shall be considered as ordered on the minority's amendment to the substitute, on the substitute itself, and on the bill to final passage, without delay, intervening motion or appeal except a motion to recommit" The System "leaders" served notice on the membership of the House that they cculd adopt this rule and agree to its gag procedure, or they could go home to their constituents and answer for their failure to pass a postal bank bill...
...Dick Root Warren...
...Nor let them offer in excuse that the House of Representatives would not agree to an honest bill...
...It would have its way...
...The System wants the Central Bank, and it wants some one else to lose the two hundred millions...
...All of them have failed to appease an indignant people...
...The roll call on the Borah amendment was published in La Follette's for March 19, 1910...
...if any implication attached to the republican tariff promise that tariff revision should be downward there was an equally unavoidable implication that the promised postal bank should be established FOR THE PEOPLE AND NOT FOR WALL STREET...
...The System managers consummated their plans...
...Some of these hard-bent and twisted efforts at public opinion making have been ludicrous, others pitiable...
...should be taken care of in the postal bank bill, to clear the way for the Aldrich Central Bank—and he laid the facts before the Senate...
...bonds in case they should become an obstacle to the creation hereafter of a central bank of issue desired by wall street...
...By unanimous consent a day was fixed for a final vote on the bill...
...He did not hope and did not expect that bonds would be actually bought under it...
...Under the rule no amendment except the minority amendment, the defeat of which by a party vote was a foregone certainty, could be made...
...The System said frankly and brazenly, "You may take this bill or nothing...
...There was "a conference," at which Smoot was "convinced" that his amendment would indeed render the bill unconstitutional, and that it must be stricken out and something else inserted to bring the bill within the borrowing power of the Federal Government...
...The refusal of the House to concur would be upon the responsibility of the House and upon its members voting against such concurrence—a responsibility which the House and its members would not be eager to carry into the coming campaign...
...Even as in the tariff controversy it was contended that the absence of an express promise of downward revision left a Republican Congress free to revise the tariff up, so in the case of the postal bank legislation it has been urged that a promise of a postal bank is fulfilled by any sort of a law that provides a government depository somewhere in a United States postoffice for the receipt of savings deposits...
...The bill was not introduced by an "Insurgent...
...Finding, however, that the temper of the public would not tolerate such petty quibbling, every effort was bent and is still bending—and twisting—to prove that the revision made was downward, or at least not upward...
...The banks, it was announced, would not favor the Central Bank plan unless the "two per cents" should be "taken care of...
...So sincere were the Senate "leaders," the Senator in charge of the bill, and Senators Root and Smoot who were put forward to amend the bill, that they joined in voting for the Borah amendment, which was adopted in the Senate by an overwhelming majority...
...that the Senate has its way on about two-thirds of these compromises...
...The political importance of passing a postal bank bill—any kind of a postal bank bill—was urged upon members...
...Of course if future bank notes were to be issued by a central bank, the bonds would lose the value attached to this privilege...
...No, they did not go off and forget it, but the constraint of circumstances,—the weather and other things—made it necessary to adjourn the session before the consideration of the measure could be completed...
...The bill was nearing completion...
...Immediately, however, it was discovered and has since been announced by the head of the Standard Oil financial system, that a serious obstacle existed to this "reform," in the nature of some $700,000,000 of two per cent...
...ON THE 13TH OF JUNE, TWO DAYS AFTER THE BILL CAME FROM THE HOUSE, SENATOR CARTER, IN CHARGE OF THE BILL IN THE SENATE, MOVED THAT THE SENATE CONCUR IN THE HOUSE AMENDMENT...
...that the bill was permitted to be exploited in the Senate only as a bait for popular support in the election...
...The Standard Oil announcement that the "two per cents...
...It is not the wont of the Senate to surrender without a struggle on important differences with the House its deliberate, carefully considered and emphatically declared convictions...
...In reporting the bill the Senator laid emphasis upon the great benefits to accrue to the people from the extensive system of postal banks which it proposed to establish in the 60,-000 money-order postoffices of the country...
...This second Smoot amendment was to strike out the former Smoot amendment, and to provide for the investment of postal bank funds in Government bonds at the discretion of the President...
...The time was at hand when (the System figured) Congress by common consent would be about ready to adjourn, to get away from the oppressive heat of a Washington summer and to get home to look after political fences...
...Senator Smoot held his amendment out as scarcely more than a pretense to bring the bill within the constitutional powers of government...
...Meanwhile the System was not idle...
...Other similar amendments were likewise accepted and agreed to...
...It was nearly the middle of June...
...We print below a list of Senators who on March 5 voted for the Borah amendmei-.t to the Senate bill, and on June 21 voted or "paired" against the identical amendment offered by Cummins to the House bill...
...If a postal bank bill was passed, it must take care of the "two per cents...
...These Senators owe their constituencies and the country an explanation of that charge...
...The convention met and declared in its platform, "We favor the establishment of a postal savings-bank system for the convenience of the people and the encouragement of thrift...
...In the Senate there was freedom of debate and of amendment...
...Discussion of the bill would be to no purpose...
...that is, prohibiting investment in the "two per cents" which constitute the great bulk of government bonds and the great obstacle to the Wall Street Central Bank...
...There was to be no doubt of the steadfast and unshaken purpose of those in charge of the bill and representing the Senate management to have the bill in the best possible form to subserve the public interests...
...high in the party councils who thought a postal bank bill must be passed...
...During the many days of discussion of the bill in the Senate it was apparently conceded, by all Senators except a few who avowed opposition to any form of a postal bank system, that such were the general lines along which the legislation should be framed...
...Postal savings banks may aid the people toward economy and thrift, although these are two virtues to which Congress is highly indifferent.—Kansas City Star...
...The life of man, if deprived of the sense of Brotherhood and the sense of Use, is more melancholy than his death.—C...
...There was every display on the part of the management of a purpose to allow this bill to come to a vote...
...The Roll Call ON MEN AND MEASURES "Fixing" The Postal Bank Bill THE postal savings bank law recently enacted by Congress, is being heralded to the country as a redemption of the promise of the Republican platform...
...8 of the bill provided, "That postal savings funds received under the provisions of this act shall be deposited in any solvent bank or banks subject to public supervision or examination in the State or Territory and as nearly as practicable in the immediate neighborhood in which the funds are received, at a rate of interest not less than 21/4 per cent, per annum...
...They got the Republican caucus endorsement for their System bill...
...Before the adjournment it was agreed by a two-thirds vote of the Senate that this bill should be a special order for a day named early in the following session—after election...
...The tariff measure was at first defended by some of those prominent in making it, on the ground that the platform did not expressly declare whether the tariff revision promised was to be downward or upward...
...The party managers in Congress concluded that it would be necessary, if it could be done without trenching upon System Interests, to pass some legislation that could be claimed to be a fulfillment of platform promises...
...Standard Oil's great National City Bank figured that the loss to the banks through the depreciation of their holdings of government bonds would amount to about $200,000,000...
...The Senator in charge of the bill met that suggestion with the following declaration: "The only investment that could be made of these funds outside of deposit in the banks will occur on the occasion of the refusal of a bank to receive, deposits...
...As reported back from the committee it conceded on its face every important principle both as to the establishment of a comprehensive system of postal savings banks and the proper disposition of the deposited funds, contended for in the public interest...
...Oliver Warner ¶This may be a highly Democratic year in the congressional elections, but it is hoped it will not apply to Fitzgerald of New York.—Kansas City Star...
...A few brief excerpts from the debate as printed in the Congressional Record will reflect the attitude which was assumed by the Senator in charge of the bill and acquiesced in by the Senate management throughout almost every stage of its consideration : To a question by Senator Cummins, whether the bill was so safeguarded as to prevent the withdrawal of funds deposited in savings banks and their concentration elsewhere, the Senator in charge of the bill replied: "The section was framed with a view to preventing the concentration of the postal funds in the Treasury or in any particular section of the country...
...Accordingly Senator Smoot subsequently offered an amendment which expressly provided that postal deposits should only be withdrawn from the localities where they belonged to pay depositors and obligations of the Government under the Act, and should not be withdrawn for investment in bonds so long as local banks would receive them as deposits and pay the prescribed rate of interest...
...They undertook to guard against the identical thing which the Senator suggests as being feasible under the bill...
...Amendments were offered and accepted...
...It was a grand unmasking...
...For the most part the criticisms were directed and amendments offered only to make definite and certain the attainment of the objects apparently sought to be accomplished...
...The anxiety of Congressmen and Senators and of the administration was allowed to develop to the keenest pitch...
...At another time it was suggested that the postal savings funds might, after being deposited in the local banks, as provided in the bill, afterwards and perhaps immediately, at the discretion of the board of trustees, be withdrawn from the local banks and sent to New York or elsewhere...
...The System concluded that it would permit its machine in Congress to "square itself" with the people by the passage of a postal bank law, if in doing so the machine could "take care of the two per cents...
...Flint Lodge Crane Frye Page Crawford Gallinger Piles The following Senators voted for the Borah amendment and "paired" against the Cummins amendment...
...Brown Cullom Gamble Scott Bnrkett Curtis Guggenheim Smoot Carter du Pont Jones Stephenson...
...The bill was referred to and reported for passage by one of the most regularly constituted Aldrich committees of the Senate...
...Postmasters General have successively recommended it in reports to Congress in 1871, 1872, 1873, 1880, 1881, 1882, 1889, 1890, 1897, 1898, 1907, 1908 and since...
...And that bill comprehended in its provisions the proposition that the postal bank deposits should be placed in the banks of the localities where they were owned, to serve the business interests of the local communities...
...There were those "Why, yuung man, 3 hardly knew you...
...Always it has been urged upon the highest grounds of public interest and public interest exclusively,—especially the public interest of promoting the prosperity of citizens and communities of small means...
...Meanwhile the Aldrich Monetary Commission had been abroad in quest of a scheme for the reorganization of the financial laws of the country...
...And again he declared: "The Senator from Michigan must take into consideration the fact that the refusal of the money by the bank in the neighborhood town or county does not authorize the board to invest it in Government securities...
...The action of the Senate "leaders" belied all their previous protestations of fidelity to the public interest...
...The two claims differ only in the degree of their untruthfulness...
...Now, the System is thrifty...
...The bill reached the Senate on the 11th of June...
...Then give every man a square deal.—Farm, Stock and Home...
...The introduction of the postal savings bank bill in the Senate was not accompanied with an avowal of System service, or a recital of these facts which have since become a matter of public record...
...These mysterious movements put Senator Dolliver upon inquiry...
...Then, as with the tariff, there will be an attempt to defend the postal bank law as a public measure...
...Meanwhile, also, the monetary commission had been studying conditions in New York...
...It was as though they shouted from the dome of the Capitol, "The House bill, not the Senate bill, is the bill we want...
...bonds, the house bill fitted like a hand into a glove every scheme of Wall Street Finance and System legislation...
...Taking the "leaders" at their word, Senator Borah, of Idaho, offered an amendment to prohibit any investment in government bonds bearing less than two and one-fourth per cent, interest...
...a tariff revision which was denounced the length and breadth of the country as an outrage, a betrayal of party pledge and of public trust...
...Sec...
...For nearly forty years the establishment of postal savings depositories has been urged upon Congress with high official endorsement...
...and that upon the order of the President, upon any consideration of the public welfare, 95 per cent, of the deposits might be so invested and without any restriction whatever as to the class of bonds or the rate of interest which they might bear...
...If the bill as reported failed in any respect to accomplish what it purported to do, the Senate and the country were repeatedly assured by the Senator in charge of the bill the failure was in no wise the result of intention or design...
...Stress was laid upon the public interest to be subserved by providing that all postal savings bank deposits, except a reserve of 10 per cent, which was to be required in the interest of safety, should be rede-posited in the banks of the respective localities...
...To those who have not given extended study to the history of important measures in Congress, the extraordinary character of this course will not be appreciated...
...It was pressed upon them that by attending the caucus they were bound by its action...
...Needless to say such a proposition would never have been incorporated in the national platform of a political party as an appeal to voters...
...And only in the event that the banks in the several states should refuse to receive deposits on these conditions was the board of trustees to be authorized to use any of the funds for the purchase of bonds...
...The System desires to preserve its control of Congress...
...Likewise the Payne-Cannon- Aldrich tariff revision is being proclaimed by a faction of public citizens and of the public prints as "performance" of another party pledge...
...And so the House substitute came back to the Senate...
...If necessary, it could wait a bit...
...And their votes and their conduct of the legislation showed that the House bill they were determined to have...
...The rule provided for eight hours of general debate in the House, at the conclusion of which the minority would be permitted to offer an amendment in the nature of a substitute for the caucus bill reported by the committee...
...It was a confession of System perfidy...
...In timing the denouement, the outcome showed that the System figured well...
...The Dolliver exposure "put a crimp" in the System program...
...Government bonds, which had been bought and were held by national banks—more particularly by the big System banks—to enable them to issue circulating bank notes under the National Bank Act, It is claimed that the banks paid more for these bonds than they were worth as interest-bearing securities, because of the note-issuing privilege that attached to them...
...Had the postal bank been urged for the benefit of Wall Street and the System or as a means of paving the way for a central bank, needless to say it would have attained little support in the country...
...bonds—the bill on march 5 was passed by the senate...
...The committee had in mind the injurious effects destined to follow the stripping of the localities of the ready money needed to transact their business from day to day...
...These amendments were welcomed by the Senator in charge of the bill and agreed to by the Senate without objection...
...When Dolliver "kicked the kettle over," any purpose to enact a postal bank bill "to take care of the two per cents" was absolutely disavowed by the "leaders...
...Where the Senate bill had provided for a fair and impartial deposit of the savings bank funds in every locality, upon the furnishing of collateral or indemnity bonds as security, the House bill, by declaring that only government or municipal bonds should be accepted as such security, will require the greater portion of these deposits to be transferred to New England, New York and Pennsylvania and to the great centers of finance where for the most part securities of the character reauired are owned...
...Where the Senate bill had provided for the deposit of the postal savings funds in the localities where they were owned, with the investment of such funds in government bonds permitted only in an exigency affecting the public credit and upon the authority of the President of the United States, and in ne event in bonds bearing less than two and one fourth per cent, interest, the House bill provided outright that thirty per cent, of such funds might, at the pleasure of the board of trustees, be invested in government bonds...
...Meanwhile a bill acceptable to Wall Street and the System was devised—a bill differing in every fundamental principle from the bill which the Senate had passed...
...That bill, as introduced, comported fairly in essential principles with the measure of the previous Congress...
...In short, it purported to be such a bill as the promise of the party had led the country to expect...
...And upon this last emphatic declaration of the senate and of those in charge of the measure, that it was and should be the policy of this legislation to provide for the retention of postal savings bank funds in the localities where they were owned, and that they should not be concentrated in the treasury or elsewhere or invested in government bonds—emphatically not in two per cent...
...Criticisms of this character were received by the Senator in charge of the bill with the best of good grace, and amendment after amendment suggested in accordance therewith were agreed to without dissent...
...The System was disappointed, but it did not quit...
...never in all those years was it advocated as a means of diverting the small savings of these citizens and these communities to the convenient use of Big Business financial institutions in the great centers of speculation...
...When the Senate "leaders" adjourned the first session of the 60th Congress, to give their attention to the management of the Chicago convention, they left behind them upon the calendar of the Senate a postal bank bill...
...And he invited Senator Smoot to present any amendment which he might think "fit to forestall any such operation...
...and that the powers that controlled Congress still adhered to their policy of the past,—that the postal savings bank should not be...
...To which the spokesman of the committee replied: "The committee have no such thought...
...On June 7 the caucus bill was reported by the committee to the House, as an amendment in the nature of a substitute for the Senate bill...

Vol. 2 • July 1910 • No. 27


 
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