Evening star. [volume] (Washington, D.C.) 1854-1972, 1904-06-18
present If he exists at all, his weight is so
small as to be imperceptible."
The Senate as Wall Street Annex.

present, if he exists at all. his weight is so
small to be imperceptible.'
The Senate as Wall Street Annex.
But IL W about making money out of in
formation as TO probable legislation? Con-
gress is supposed by some to be kind of an
annex to Wall street.
TT is not So replied Senator Elkins. Il
don't think senators speculate upon such
matters. In the first place how can one be
sure Of his information, and II so, how be
sure that the markets will go as you expect
them to go. The truth Is the Wall street
brokers can discount the action of Congress
quite well as we cen, and such of our
senatorial lambs as have gone to Wall street
have come back badly shorn. There are not
many, but now and then one may take a
flyer, as it is called but 1t is usually to his
sorrow. Indeed l have never heard OF any
senator or representative making much
money ly such specu.atons.. l don't believe
1t possible, unless backed by an experience
and ability in such matters which would
make Ia, man a success on the outside. Be
sides most of the senators are poor, and
that in itself is an evidence for their In
| nocence as to this charge"
How Pierpont Morgan Made Million
in One Day.
But, Senator Elkins, some men do make
a great deal out of the government. How
| about the Cleveland bond sale of $62, OOO, 600,
| whereby, according to the papers, Pierpont
| Morgan made $1,000, 600 in one day."
81 remember that statement. said Sem
ator Elkins IT quoted 1t in one of my
| speeches In the Senate But Pierpont Nor
gan is not a United States senator. He is
a New York banker of international note,
| and greater in business than any or all the
senators put together. The money he and
his fellows made out of that sale was in
| the ordinary course of legitimate business
| and their success camely largely from play
| ing upon the fears of the administration
| and the country.
IT can't see why Grover Cleveland called
| that matter up at this time" continued
| Senator Elkins. 1T may be that he wants
| to be the democratic candidate for the
| presidency, and thinks that this feature OF
| his administration may help him. To my
mind it is far from commendable. and
showed this at the time by a resolution
which introduced into the Senate provid-
ing that no further sales of bonds should
be made without advertisement or by pri-
vate contracts. 1 believe that resolution
saved Uncle Sam a great deal of money
When it was before the Senate Russell
Sage wrote me that / had saved the gov
! eminent 100000 by it,
How Cleveland Sold Bonds.
"Give me the story in NUTSHELL said I.
Since Grover Cleveland has revived the
subject 1 have no objection to doing So"
| replied Senator Elkins. 1T was in the lat
ter part of 1895 that Cleveland made his
contract with certain New York bankers to
take So, 100000 worth of United States 4
per cent bonds at 1912 and place them in
Europe. This contract was made without
advertisement for bids and as a private
sale to j. Perpont Morgan. The reason for
it was that there seemed to be a scarcity
of gold in the country, and the gold reserve
fund in the treasury had fallen consider
q "a On-dO
mark, which is the legal reserve. Shortly
after the sale was made it was reported
that Mr.. Morgan took the bonds to New
York, and within twenty-four hours there
after sold them for 112, and more. so that
| the syndicate made about six million dol
| lars out of the deal. OF this 1t was alleged
that J. Pierpont Morgan received one mill
lion dollars"
"At the same time more gold was needed,
and 1t was proposed to issue one hundred
million or two hundred million more of
bonds In the same way. Our laws provide
| that even the smallest of our public con-
tracts shall be by advertisement, and only
to the highest bidder, and did not think
| 1t was right to sell the bonds in this way
to private parties without such advertise
ment. 1 also thought there was plenty of
gold in the country, and that the bonds
could be sold at home. l was SO convinced
of this. that, although 1 was then new to
the Senate and backward about pushing
myself to the front. and although all my
friends advised against it, / offered my
| resolution that no further bond should be
placed at private sale or under private con-
tract, and that no sale whatever should be
made without due advertisement for pro-
posals, and then only to the highest bid
der"
Might Have Made $4,000, 900.
How did the resolution take in the Sem
ate when it was offered?" asked
II was warned that 1t would create a
panic. Some of the senators thought 1t
would throw the nation into bankruptcy
and begged me to keep quiet. I offered the
| resolution, nevertheless. and in speaking
upon 1T showed that war loans aggregat ting
more than s. 500. 600, 600 placed in time of
peril had been put out at less expense to
the government than these sixty-two mil
lions issued in time of peace. l showed
that the loans of the civil war were placed
at commissions of less than per cent to
the government, while the New York bank
ers had already made more than per cent
out of that contract with Uncle Sam and
that they now expected to make as much
or greater percentage on the 500, 100000
or the $2OO,OO0,OO0 then under considera
ton. In other words, If the issue of $780,
100000 was sold through them at the same
rate their profits would be about &c.
COO co.,
How did it turn out. senator?"
1.-The result was that the people began to
protest against further private sales" said
Senator Elkins. THE President and the
Senate woke up and saw that they were
not necessary and that they would be I'M
popular. A hundred million dollars worth
of bonds were then advertised as for sale
to the highest bidders. Those bonds wero
subscribed for six times over at 112H or at
eight million dollars more than the govern
ment would have received had they been
privately sold at the price Cleveland made
for the sixty-two million dollars"
Sugar-Coating the Pill.
sDo YOU think Cleveland was honest in
this matter, Senator Eikins?"
Eyes, but the Wall street bankers fright
ened him. He did not understand the coun-
try, and they made him think we were in
danger of bankruptcy. I have nothing to
say against the bankers 1t Is their bust
ness to get the bonds as cheaply as they
could The members of the syndicate were
able men. and. many of them were my
friends. Indeed. had I not been In the
United States Senate / hardly think