Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1908-07-31
About Panics.

Since the Republican party came into
power there has been four great panics--those
Of 1873, 1884, 1893 and 1907. Three Of these
were coniessedly panics which occurred at a
time when the Republicans were In complete
control These were the panics OF 1873,
1884 and 1907. The panic Of 1893 occurred
Immediately after Cleveland went into Office,
and was produced by the banks associated in
the New York Clearing House, who con-
stricted credits and suggested to all their
correspondent banks throughout the country
to construct credits on the alleged ground
that gold was leaving the country, but pro-
badly for the purpose Of securing repeal OF
the purchasing clause Of the Sherman Act
and to prevent further recognition OF silver
All panics have one vitality important fea-
ture In common which might be called "the
soul Of q panic''-that Is, the withdrawal OF
money from the banks and from circulation
by frightened depositors and by the hoard
ing Of such funds. The fear Of deposltors
may arise from variety Of causes. Whom
bank depositors realize that situation has
arisen whereby they can not obtain their
bank deposits in cash on demand, many will
withdraw their funds and lock them up
Whenever this happens in any important de-
gree il paralyzes commerce, causes bank sus-
pensions, the bankruptcy Of merchants and
the suspension OF business activities. 1t closes
factories and throws men out OF employment
sometimes on vast scale, 90 In each OF the
four great panics named.
II the Democrats were responsible for the
panic Of 1893, II was grievous response
bility. II the Republicans were responsible
| for the panics OF 1873, 1884 and 1907, they
were responsible for three panics and for Blu
siness calamities three times as serious, but thu
| fact is the Republican party was really re-
| sponsible for all four Of these panics, because
| IL lacked the wisdom (it had the power) to
provides remedy against panics.
The primary cause OF panics is the fear Of
the people that they cannot get cash for their
bank deposits. The immediate effect Of thil
fear Of panic is the withdrawal of currency
from the bank and the boarding Of such cur
rency In lock boxes and hiding places. The
coincident effect Of this withdrawal Of cur
rency 10 frightening the bankers into bank
| ers' panic, and they make 1t worse by the
suspension OF credit, and the suspension Of
credit means Q paralysis OF business, because
ell men do business on debt and credit basis,
extending credit or receiving IL.
The best witness of the responsibility OF
the Republican party Of the panic Of 1907 ID
Senator Aldrich, Of Rhode Island, the leader
Of the Republican party In the Senate Of the
United States and to his statement made on
the floor Of the Senate, which Is complete
denomination and confession Of the great sin
and omission OF that party and itS direct re-
| sponsibility for every panic since the war.
He said "the financial crisis from which
the country has Just emerged which culml-
| mated In serious panic in October was the
most acute and destructive in It's immediate
consequence of any which has occurred In the
history Of the country. II Is impossible to
conceive, much less 10 measure, the losses
which would have resulted from such q ca =
lamity, The country was saved by narrow
margin from an overwhelming catastrophe
whose blighting effect would have been felt
In every household. A total collapse was
avoided but the shrinking In the values Of
securities and property and the losses from
injury TO business resulting from and iuciden-
tai to the crisis amounted to thousands Of
| millions Of dollars"
II is perfectly obvious from this statement
that Senator Aldrich believed that II the Re-
publican party had done its duty, 1t would
have passed legislation protecting the United
States against panics long years ago and
would have prevented the panics Of 1873,
1884, 1893 and 1907.
One Of tho stock arguments Of the Repub-
lican party since the panic OF 1893 has been
that the Democracy 10 synonymous with
panics and coincident with hard times. Only
the unlearned could be misled by such pre-
tsnse The panics Of 1873, 1884 and 1907
occurred ct time when the Republicans had
full control.
The panic Of 1893 was ripe and ready TO
blossom forth when Cleveland came into
power the second time.
Il 10 o well established fact that President
Harrison, before his retirement on March :,
1893, had gone 90 far % TO prepare plates for
Q bond issue and these very plates were used
| by President Cleveland as an Inheritance from
the Republican administration.