The record. [volume] (St. Maries, Idaho) 1913-1918, 1913-07-22
The Power of the
Government

At the time of the Kuhn bank fail.
ures in PittsburR. Secretary of the
Treasury MoAdoo rendered the clear
ing house association of Pittsburg
$50. 600. 90 to be used. II necessary,
to protect the sound banks of that
city from the after effects of those
failures.
When the great banks we're tieing
up cash and announcing the proba
blIity of a shortage Of funds with
which to do the business of the ooun-
try and particularly to move the
crops, the secretary announced his
readiness to issue $500. 600. 600 in
emergency currency. IL necessary, TO
furnish a sufficient am ount of cash,
and he actually increased the depos
it's of the government in the national
banks of the nation more than So,
600. 600. announcing at the same
time that just as rapidly as possible
these deposits would be increased
$50. 600, 600 more from cash lying
idle In the treasury vaults at Wash
ington. To protect the public he
raised the interest charges on these
government funds.
What has been the resultY
The clearing house association at
Pittsburg announced that 1t would
not need the money offered IL.
The banks all over the country
where government funds we're offered
suddenly found that It would be un
profitable business to pay tine govern
ment an increased interest on funds
lying idle 10 the banks, and they be
gan to make loans.
The big New York banks which
had sought to make money by rails.
ing the rates for call loans, the min
ute announcement wss made of the
determination to send out $500, 600,
600 of emergency currency, reduced
the rates on call loans that had been
maintained for several weeks, and
one New York bank alone Invested
81, OO00, 90 in commercial paper.
whereas prior to that time It had de-
olared IL had no funds whatever for
such Investments and no money at
all except for gambling purposes on
EfalI loans. Another New York bank
Followed the example of the first bank
land invested SO. 600. 200 Ia CONNER
GAIL securities. Other banks of course
had followed the example, or will do
so. and the money which had been
tied up In the vaults of the banks
and not In the stockings of the PEG.
ple-is rapidly beginning to performl
Its expected duty. III
Formerly Wall street aud the wen
street banks produced panios. tied up
business. depreoiRted values and
brought stagnation upon the country
and then. after this had heen thor
Oughly accomplished, had appealed to
the government for aid and the gov
eminent had come fastening forth
with relief, such relief. however, he
ing 10 the shape of large deposits OF
cash Ia the Wall street banks.
This government money, together
with the money of the whole country
deliberately tied up in these New
York banks, WAS used buy the seour-
tiles and other property which had
thus heen hammered down TO the
lowest point. with the release of
the moneystlmes began to get better
and pI Ices began to rise and the bank
pulled In the immense profits from
the people that they had deliberately
started out to make. They had tied
up the money until prices sunk out
OF sight because of the consequent
stRgnation In business; they had
bought at these low prices because
they had the peoples money and then
they had run the prices to the top
notch and unloaded again on the
people who, by that time. had secur
ed the money.
Itkhas been a never-ending ohains of
bank gambling with the prosperity OF
the country.
We call attention to this merely to
show how powerful government Is to
serve the PEOPLE or to harm the people
- to serve the special interests or to
serve the whole people. IL can be
used to give certain persons power to |
wiring Immense profits from the people |
TO crush out men doing business on
credit, TO forsolose IN the mOrtgaged |
homes OF the poor man and take from /
him his LIES earnings, or 1t can be
used to prevent such deliberate rob- /
berry.
Ii the people shall learn from this
and other Incidents to take charge of /
their own government, then the les
sons Of the past will have been learn
ed cheaply; II they do not learn this
lesson, then they will pay dearly for
their futher experience. Capital
News.