Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1913-05-10


which, by disturbed financial condi
tons, always suffer most severely
/, II Is a fact that those individuals
private bankers and banks to whom
alone apparently, by the language OF
the preamble, is attributed the power
ito Great, avert and compose panics,
were the ones to suffer most by the
severe shortage insecurity values
such losses-as the public records
will In many cases show-running into
many millions of dollars. 1t is impos-
sible, therefore, to imagine motive
on the part of such persons as would
lead to campaign of self-destruction.
Who the Heaviest Losers were.
1t has often been observed that Mr..
Morgan aided actively and effectively
in the efforts to compose" the panic
Of 1907. Such aid as he was able to
render to the situation In New York
at that time was due, we believe,
simply to his ability In securing the
prompt cooperation of many diverg-
ent minds which represented strong,
independent banks. The same kind
of service always is to be commanded
in this country's emergencies.
IL we have dwelt with more cir
cumstance than perhaps your judg-
ment approves upon these features Of
the preamble, 1t is because we be-
lieve that the whole framework and
language of the congressional resolu-
ton under which you are acting i'm
plies conception impossible in sound
theory, and whole impossible In prac-
tice; such theory being that CON-
paratively small group of men, chief
ly centered In New York City, can
and do obtain such complete mastery
over the financial machinery of one
hundred millions of Independent peo-
pie that they have power to cause
this whole country incalculable dis
tress, or as the resolution puts it:
have welded power over the bust
ness, commerce, credits and finances
of the contry that is despotic and per-
ilous and Is daily becoming more per-
ilous TO the public welfare"
Faiiacious Statistics Presented.
For the maintenance Of such an i'm
possible economic theory there have
been spread before your committee
elaborate tables OF so-called, inter
locking directorates from which ex.
ceedingly mistaken differences have
been publicly drawn. In these tables
Il is shown that $50 bankers and bank
directors serve upon the boards of
corporations having resources aggre-
eating twenty-five billion dollars, and
IL is implied that this vast aggregate
Of the country's wealth is at the dis
posal of these $50 men. But such
an Implication rests solely upon the
untenable theory that these men, liv.
ing In different parts of the country,
in many cases personally unacquaint-
ed with each other, and in most cases
associated only in occasional transac-
lions, vote always for the same poll
cies and control with united purpose
the directorates of the 1872 corpora,
tons on which they serve. The tes-
timony failed to establish any con-
certed policy or harmony of action
binding these $50 men together, and
as a matter of fact no such policy ex-
lists. The absurdity o; the assump-
ton Of such control becomes more
apparent when one considers that on
the average these directors represent
only one quarter Of the MEMBERSHIPS
of their boards. 1t is preposterous to-
suppose that every "interlocking' d.
rector has full control in every or.
ganization with which he is connect
ed, and that the majority of directors
who are not "interlocking" are mere
figure-heads. subject to the will of a.
small minority of their boards.
Perhaps the greatest harm in the
presentations referred to lay in the
further unwarranted inference, to-
which has been given wide publicity,
that the vast sum of $4,000, 900 900
was in cash or liquid form, subject to
the selfish use or abuse of individ.
uals. Such an idea excites the public
mind to demand the correction of a
fancied situation which does not and,
in our belief. never can exist.
The Force Of Public Opinion.
AS the final point of this memoran-
DUN. We venture to submit the con.
alteration that in a strong public
opinion, such as exists in this coun-
try, there lies the greatest safeguard
of the community-always assuming
that congress will evolve basic sys-
tenn of banking which is scientific and
sound-as at the present time, our
is not The public, that
is the depositors, are the ones who
entrust bankers with such influence
and power as they today have in
every civilized land. and the public is
unlikely to entrust the power to weak
or evil hands. Your counsel asked
more than one witness whether the
present power held by bankers in this
country would not be a menace If il
lay in evil hands. Such an inquiry
answers itself. All power, physical.
intellec .ual. financial or political. is
dangerous in evil hands. If congress
Mere to fall into evil hands the re-
IT'S might be deplorable. But to us
Nems as little likely that the cit
Aof this country will fill con
Nth rascals as it is that they
Nst the leadership of their
bu. I'd financial affairs to a set
e. kues. The only genuine
mower oh on individual mr. n