The Washington times., 1908-08-21
Joker Fou'ad in Currency Law
Calls for Railroad Valuation
Interstate Commission Comes to Rescue of Treasury
Quandary as Result of Aldrich's Clever
Manipulation.

Who's to decide what railroad bonds
and stocks shall be accepted by the Sec
retary - the Treasury as security for
currency issues, undel the emergency
provisions OF the Aldrich-Vreeland act?
Secretary of the Treasury Cortelyou
and the Interstate Commerce Commis-
sion have been wrestling with the ques-
ton for some time. and the only result
thus far reached is a feeling In some
important quarters that the movement
for making a valuation of the railroads
has received. all unintentionally, a big
lift by the passage of the currency law.
The Secretary Of the Treasury is
given fun authority 10 accept or reject
any security presented to MIN. Natur-
ally, he is anxious that whatever he ac-
cepts shall be Of unquestionabIy gilt
edged character. His Investigations. in
the effort to ascertain If there is any
standard by which 10 Judge railroad
securities. have brought out a curious
situation.
Anticipating that it might become his
duty this autumn to pass on prohered
issues Of this kind, Secretary Cortelyou
some weeks ago addressed a communi-
cation TO the Interstate Commission,
asking il that body could furnish him
information about the railroad securf-
ties Of the country which would enable
hIm 10 pass judgment on them.
As there are some $4,000. 60, go OF these
outstanding. representing almost innu-
merable characters, issues, classes Of
security. etc, it looked like rather
staggering demand. TIE commission
was able distinctly 10 recollect thar Il
had strongly recommended TO Congrt -
tEe passage Of an act for a valuation %
The railroads, which would have given
il means TO acquire just sucn informs
uOu as this but il didn't know that ans
such act had passed. II was even able
10 recall That Senator La Toilette Of
fered an amendment to the Aldrich cur
reucy bin. providing that this valuation
should be made; but this, too, was re-
jected.
Find the joker.
Inquiry was instituted as 70 what re-
sources of Information We're at com
mauG. i developed that the commits
sion authorizes on such subjects didn't
remember that railroad securities were
made available as security for circula-
tiOn under the new act. IN fact. every
body seemed to have quite distinct
impre ssion that the railroad securities
were not allowed.
It was recalled that railroad bonds
were included in the list of securities in
the original AIdricl measure; but IL
also was distinctly remembered that
on the morning OF the day when Senator
La Toilette was about - open mp his
great speech against the Aldrich bill,
Senator Aldrich rose aud cut the ground
from under La FOlietts's feet by moving
an amendment TO take railroad bonds
out of the list leaving only Government.
State. county and municipal bonds of
certain descriptions. THIS was regarded
al the time as a clever ruru by which
TO unhorse Ia Toilette, and take away
his chief objection 10 The bill, before
ne should be able 20 deliver his philippe
against it. Everybody know his speech
was aimed mainly at the use of these
classes of security, with them stricken
out, it was assumed he would have
nothing left 10 say.
La Toilette made his speech. and then
there was sag in the movement for
the legislation. and for month or
so il looked IS If no currency leglsla-
lion could pass In the last days Of the
session the Vreeland bin was brought
forward. and 10 and the Aldrich bill
were welded together into a compromise
measure. This measure passed
At His Discretion.
So when they found that the Secretary
Of the Treasury was asking about rail-
road bonds and stocks. the Interstate
Commerce people got out copy Of the
Aldrich-V -Vreeland law as passed, and
studied it, They found what had hap
pened.
Down in the body Of the bill was an
enumeration Of securities which might
be received: national, State, county
and municipal bonds, and farther on.
amy other securities which the Secre-
tary might approve.
ANY other securities" That includ-
ed railroad stocks. bonds, commercial
paper. anything else that the Secretarv
should approve. The railroad bonds
were back in the bill, and along with
them the stocks. Senator AlCrlch had
everything he originally wanted, and
more.
Having figured all this out from a
study IF the bill. the Interstate Com
mission authorities conferred, and then
a member Of the commission went over
TO the Treasury building to see Sec
retary CortelyOu. This mission was en-
trusted 70 Chairman Knapp Just what
happened in the conference has not been