The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-12-09
SWANSON CHARGES
WALL STREET BRED
LAST GREAT PANIC
In Warm Colloquy With Sena-
tor O'Corman Who Denies
His Statements and Defends
New York Banks,
Senator Quotes Re-
port of Comptroller of Cur
rency to Sustain Charges and
Figures. Inaccurate Insists
New Yorker.

WASHINGTON, Dec. S.~~Another
effort was made in the senate today
to fix upon New York City bankers
responsibility for the panic of 1907.
and prove that they had been unfair
with the country bankers in withhold
ing money deposited in New York.
This time Senator Swanson, of Vir-
ginia, made the attack.
In attacking the New York bank
ers. Senator Swanson followed the
beaten paths that have been laid out
in the senate by others. In brief he
asserted that the New York bankers
had absorbed the reserves of the coun-
try banks and then refused the de-
mands of the latter to return the
money when the panic came, Senator
OfGorman asked MIR. Swanson to be
more specific.
Replies To O'Gorman.
Il stated specifically" said Senator
swanson. that the New York banks
neld s224. 100000 OF reserves Of their
own. and they owed the country banks
nearly $4,000. 600"
Senator Swanson. in reply TO uues-
ton from Mr.. OGorman, explained
that he obtained this information
from reports of the comptroller or the
currency. To this Mr.. o'Gorman re-
piled that the senator from Virginia
Swanson insisted he was right
Thereupon, Senator OGorman read
from the testimony taken before the
banking and currency committee,
quoting leading Southern bankers 10
prove that tho New York City bank
ers were acting fairly with their ceun-
-trx- CORES pandenfs. and thai there
never had been difficulty To get &C
Communications with the New York
banks
when the senator from Virginia
INDUCES in unwarranted. inaccurate,
and unfair criticism. he continued,
"of the bankers Of the city OF New
York, he does himself an injustice,
and he does injustice to his own con
stituency If he thinks he reflects thei'
views"
Figures before Him.
Replying. Senator Swanson In
sisted that he had before him n sum-
mary OF the report of the comptrol-
Ter OF the currency as TO the condt-
ton OF the national banks on August
a.. 1907. just prior to the panic. II
showed that the banks OF New York
owned national banks s2i3,ooo.o 600,
and owed State banks siss,oo0,o 600
or 4 total of s409 900. 900. that was
on deposit with New York banks due
to other BANKS.
Senator O'Gorman interrupted to
state upon authority that at the time
the country banks were demanding
their money from New Y ork. the New
York city banks had more money
loaned to the country banks than they
held as deposits from the country
banks.
Senator Swanson insisted this was
not true. He charged that he came
to Washington with delegation OF
Richmond bankers asking for relief.
and that the treasury department re-
fused to order the New York banks
TO pay over to the Richmond banks
deposits carried by the Richmond
bankers in New York, but that the
government made an order trans
ferring Internal revenue funds from
Richmond TO New York
Swanson's Speech.
Senator Swanson said that the
measure Is wise. prudent and con-
sentative; that ii retaines all the good
features OF our present currency and
banking system and only eliminates
acknowledged evils and supplies con-
fessed additional needs. that 1t Ia ad-
vantageous In that II continued our
present currency without diminishing
It's volume aggregating $500. 100000.
that II continues our system OF indie
pendent banks. which has been most
beneficial in the development Of this
country.
He presented the superiority OF the
American system OF independ int bank
ing over systems in other countries
with a few large central banks and
many branches. He said that under
the pending bill the $4,000 banks OF
this country would continue to dc
business as heretofore,
Mr.. Swanson opposed the central
4tat{ aYt "a a Il
claiming that the advantages OF cen.
trail bank were far exceeded by the OBJ
tections to such a bank. He claimed
that under the proposed system about
,ne-fortieth of the banking capital OF
he country would be included IN ths
system and about one-fortieth of the
banking resources Of the nation. thus
claiming that the vast amount or bank.
ing capital and resources unaffected
by the system would be left for bust
ness and accommodation as now exist.
ing. He asserted that while the capita
and resources Of the federal reserve
banks created under the bill wers
small in comparison to the capital anc
resources undisturhed by the bill, ye
It was ample for the purposes sough
To be obtained and made the fedora
reseve banks far greater IN capita
and resources than the Bank Of Eng
land, the Bank Of France or tht
Reichsbank Of Germany. and thu.
would be more potential In correcting
parics and money stringency thar
these banks.
Issuance OF Currency.
He next discussed the issuance o
currency under the proposed bill. HI
insisted that the issuance OF currenc,
/. was governmental function ant
should be controlled by the govern
nent In the interests OF all the PEG
pie and not for the profit OLA few
He discussed the method pursued II
England. France and Germany for tn
issuance OF currency and claimed tina
.cnntinusd on second Pags.,