Evening star. [volume] (Washington, D.C.) 1854-1972, 1914-08-25
M.ADO0 IS AGAINST
CROP VALOR|zAT|ON
EmphaticaIIy Disapproves Pro-
posaI at Cotton and Tobacco
Growers Conference.
URGES THEY "GET DOWN
TO A PRACTICAL BASIS"
Bankers, Spinners and Producers
Generally Find Assurances Of
Treasury Head Satisfactory.

crops because of the European war at
ioday.s conference of cotton and tobac-
90 growers He appealed to the con-
terence tie get down TO practical
basis: e.
ANY issue of currency by state banks
is utterly unnecessary, said Secretary
NcAdoo, "and it is a waste of time to
talk about it. Enough national bank
currency. is authorized by present law
TO handle the cotton and all the other
crops in the country There is au-
'horization in law for enough currency
10 wreck the whole country.
The Secretary of the Treasury has
wide discretion in the issue of this cur
rency. I intend to see that all cur
rency issued is safe, because / tell you
gentlemen that you cannot do any
thing worse than to initiate the cur
rency to a point where you Will wreck
the credit of the country.
Secretary McAdoo added that the
valorization plan was impracticable, and
that the valorization of cotton would
mean a demand for the valorization of
every other product affected by the
European war.
This cataclysm in Europe he said.
has caused a recoil in all business in
this'.country. 1t is foolish to say that
nobody will be hurt. Our business here
is not to say that no one will be hurt.
cur business is to help everybody to
meet the situation as best they can"
Economic Laws to Fix Price.
The price of cotton must be fixed by
natural economic laws, and be estimated
for loan purposes in transactions between
banker and grower, Mr.. McAdoo declared.
State banks will not be allowed directly
to share in the output of emergency cur
rency Indirectly it is certain that they
Will share in the issue of emergency cur
rency to national banks to the full extent
of the needs through the workings of an
inevitable economic law: the demands of
national banks for emergency currency
will be naturally based upon the needs of
smaller correspondent financial institu-
tons. The Secretary of the Treasury is
without authority in law to extend such
aid to other than to national banks and
members of the national currency asso-
Citations.
Under the emergency currency act.
Secretary McAdoo said he would accept
properly safeguarded cotton warehouse
receipts as 20 per cent security for the
issue of currency
Warehouses. which may issue receipts
acceptable as such security, need not
be bonded. The Secretary of the Treas
ury is willing TO accept the responsibility
of waEehoGses which provide adequate
protection for the preservation of cotton
or other staples, and under. proper insur-'
ence against fire.
This practically summarizes the prom
Use of relief in the cotton situation. and
the administration view of how it will
work out .Secretary McAdoo stated his
position in the course of todays session
Of the cotton conference here, replying to
Representative Sisson of Mississippi. who
Urged that state banks be encouraged to
issue currency-by the removal of the
legal tax restrictions. The Secretary of
The Treasury opposed return to what
he called wild cat circulation. point
ing ont the experiences Of the history OF
such 'currency and the dangers of an
inflated currency 10 the national welfare,
Conferees Indorse Viewpoint.
Bankers, spinners and producers gen.
orally found the assurances of the Sec
rotary satisfactory. He was roundly ap-
plauded. and a number of speakers gave
direct Endorsement to his point OF view,
expressing themselves content with
the attirudei of the administration. There
was some continued demand for vaiorl-
cation of cotton for loan purposes.
The demand for greater paternaism
on the part of the government did not
find general favor either among Dank-
ers or spinners. The administration
representatives, regarding the SITUATION
as one calling for relief within the
law, did not favor consideration of pro-
posed legislation. especially such as
might prove impossible or difficult of
enactment.
plea for the removal of the legislative
tax of 10 per cent on issues OF paper
currency by state banks. This accom-
tlished he declared, the state banks
would handle the crop situation: Sec
rotary McAdoo shut him off in the
midst of his speech, suggesting that
his argument was one for Congress.
and not pertinent to the purposes OF
the conference, to meet an immediate
situation by means provided by exist
ing law.
Senator Williams of Mississippi told
the conference that there must be ex-
pectation of loss. and that growers,
1nanciers and spinners must be pre-
pared to bear it. The government was
pot in a position to save them that
loss, but would be glad to help to make
he loss endurable.
Urges Trade Be Acquired.
His note of optimism was that spin
,ers in England and France will be
pussy to the utmost capacity trying to
acquire the trade lost by Germany and
Austria. American spinners. he said.
would be foolish if they were not work.
ing night and day in two and three
lhifts as the supply of labor will per
hit. trying to do the same thing.
T. B. Hayne of Louisiana, repre-
tentative of southern banking inter-
ISIS, proposed tHdt the government
lgree to loan money to bankers to the
Imount of $40 a bale on cotton COL
literal Cotton cannot be reproduced
lor cents a pound or $40 a bale, he
asserted. with correlation by other
growers. 1t may sell for less, he ad-
mitted in event of succession of
big crops.
The government, he said, is the only
tgent with courage to fix valuation
Of cotton. He considered that the value
Of cotton a. safe security should be
liked. He wanted the government to
Ittempt this.
Albert Greene Duncan of Boston rep
resenting spinning interests. declares
there is no combination of cotton manu-
featuring interests He also said that
the spinner Is not expecting to find adj
vantage in the misfortunes of the grow
srs. The losses in the cotton Industry.
said, should be distributed. and he
vas anxious that any measures taken to
relieYe the situation should have regard
% equal distribution of benefits
A W. Mclean of Lumberton, n c..
Tho comes from section where cotton
S raised by tenant farmers, asserted
that adequate warehouses can be built In
.en days
A stable price. he declared was i'm
'oerative. but he did not consider that the
government could effect il. He PROPOSED
that southern legislators should attack
he problem. meeting at once to pass
warehouse legislation a basis for
standardizing the value of cotton as Sc.
.urity The cotton states can take care
If the situation with the aid already
promised by the Secretary of the
Treasury.
The states. Unable to raise money. he
suggested. can exchange bonds for ware
rouse receipts. This can be exchanged