The Birmingham age-herald., 1908-01-30
Labor Leader Appears Before
 House Committee
METHODS ARE CRITICISED
MT. Gompers Declares That 1t Is Wrong For Banks To Have the Privilege of Issuing Money On
 Bonds Drawing Interest.

Washington, January 29.-Samuel Com pers president of the American Federa- tion of Labor, was an impromptu speaker today before the House committee on banking and currency, at a hearing on the question of currency legislation. MT. Gompers prefaced his remarks by saying that he was not prepared to discuss the features of the finance problem, nor to submit any solution.
 T am free to admit" he said, that after very many years of study of the subject of money and it's issuance, l have not yet solved the problem to my own satisfaction. I believe we must meet she new conditions confronting us as a nation, and that many old conceptions must give way to new conditions; yet cannot escape the belief that relative provisions in the constitution ought to have little more weight in the deter imitation of the nations financial poli- cies affecting the issuance of money. To relegate that power to private in- terest is something which, in my judg- ment, is not sustained by a proper in- depreciation of the constitutional pro- vision that the government of the United States is the duly constituted authority for the issuing of money"
 MT. Gompers attacked the system in force by which the banks are permitted to draw interest from the government, on government bonds, which they put up as security for bank note circulation"
 This system" he said, 'affords the banks an unwarranted privilege of malS- ing money. The bank is entitled to in terest on the bonds it buys, but it ought not to have the privilege of issuing money on the strength of these bonds"
 MT. Gompers accepted the statement by Representative Powers of Maine that the profit concerned is so minute that the banks really cannot afford to take out more bond-secured circulation than the law compels, but he clung to his view of the unfairness and impropriety of the system, though conceding the truth of the statement that the compulsory pur- chase of bonds as circulation security is the means by which the government funds the national debt
 Answering a question, MT. Gompers said
 "One thing is certain: No blame can be laid at the doors of the workingmen of this country for the recent financial panic. l, myself, advised the workingmen not to withdraw their savings from the banks, but on the contrary, to deposit their hoardings in the banks, because l felt their money would be sa1er in the banking institutions of the country, than in their homes or in the boxes of safe deposit companies
 MT. Gompers was asked whether the working people of the country had suf- fered much as result of the financial disturbance.
 Yes" he said, i've have suffered great ly by the closing down of industrial plants and the reduction of working forces"
 He was, however, unable to state the percentage of unemployed as a result of these conditions. He asserted that the country was greatly helped in the crisis by ''the firm attitude taken by labor unions against wage reductions, because yielding to reduction in times of finan- cal and industrial depression simply re- duced the general power of consumption and increases rather than lightens the trouble"