New-York tribune., 1913-10-27

ure Of the measure which involves gov
ernment control.
"He declared the principle to be
.practically inexpedi,nt and funda-
mentally wrong The objection, said
Mr.. Vanderlip, is not to the powers
granted to the federal reserve board
but to the hands in which they are
nlaced.' Asserting that both financial
and political history furnish ample
Illustration of the danger, the ineffec-
tiveness, the inadequacy of politically
appointed boards Mr.. Vanderlip went
to the extreme of saying:
IF such a board as is proposed were
formed by appointing the seven leading
bankers OF the United States-whoever
they may be-and these men became dis
sociated from the daily conduct of actual
at arms length the operation of the sew
eral reserve banks, they would very rapid
" lose the power TO direct wisely. II
seems to me that the only proper method
of control must be through board COM
posed Of practical bankers. in direct touch
with current business, who are selected
for short terms by the member banks
Says VanderIip Is Inconsistent.
"In direct contravention Of this posi-
ton, Mr.. Vanderlip and his Wall Street
associates come here at the last hour,
finging consistency TO the winds, propos-
al
member of which is 20 be selected by the
stockholding banks, but all by the Presi-
dent Of the United States. Mr.. Wander
lip in July objected TO the long term OF
seven years provided by the House bill,
but now, in October, he would stretch out
the term to fourteen.
"Mr. Vanderlip in his testimony before
the Senate committee differentiated his
bill from the House bill in several inn
portant features. among them: Uniform,
nationwide discount rate, instead Of re-
gional discount rate Three months ago
Mr.. Vanderlip in his letter highly COM
mended the House bill for its superiority
to the Aldrich scheme in the very par
ticular in which he now condemns the
again quote from his letter OF July "a:
Ir one way the system Of regional
reserve banks has an advantage over the
national reserve association proposed by
the national monetary commission. The
plan for a national reserve association
provided that there should be a uniform
rate of discount throughout the United
States. The present plan for regional re-
serve banks contemplates that the rate OF
discount will vary in different sections OF
the country at the same time. Such vari-
alton of rate is sound banking
III variation OF rate as provided in the
House bill was sound banking In July
how does IT happen that uniformity OF
rate in the Vanderlip scheme is SOUND
banking in October?
"In his letter to me last July Mr.. Van
derlip accentuated the utter undesirable
ity, in his view, OF any radical departure
from the existing national bank act. and
warned the House committee that, unless
legislation should be made attractive 10
the national banks. they would quickly
abandon the system. He was against
doing violence 10 long established meth
DDS; he repeated substantially the out
cry OF the bankers against force bill
and against the 'confiscatory' clause OF
the House measure, contending that the
owners of banking capital should man
age their own property and predicting
total failure II the House scheme should
not be made more advantageous TO the
banks