New Britain herald., 1917-12-05
SECRETARY M'AD0O
MAKES HIS REPORT
CONTINUED from First Page.)


of the average citizen. He is draw.
ing upon the general store of sup
plies in the country with almost the
same freedom as before America came
into the war. This cannot continue
without serious hurt to the nation and
to the world. The great financial
operations of the government cannot
be carried forward successfully unless
the people of the United States econ
omize In every possible direction, save
their money and lend it to the govern
ment."
Secretary McAdoo denounced DUR
chasers of Liberty Bonds who sell
their bonds when they do not imper-
atively need money.
ut is by actually lending money to
the government and not by merely
promising 1t and shifting the load ia
some one else," he said, that the
citizen really helps in this great time. u
He added. however. that he did not
mean to discourage legitimate trading
In government securities.
Mr.. McAdoo expressed the hope
that additional funds to be raised dur
ing the balance of the year be by
bond issues rather than by taxation,
saying:
1T is my earnest conviction that
the general economy of the country
should be permitted to readjust Itself
to the new revenue laws before con-
sideration should be given to the i'm
position of additional tax burdens"
or the possibility that interest rates
on future Liberty Bond issues might
be raised, the secretary said:
IF q situation should develop where
the government could not sell con-
vertible and partly tax exempt bonds
upon q 4 per cent basis, it would, l
believe, become necessary to serious
ly consider further revenue legisla-
ton. In my judgment an increase in
the rate of interest of such bonds
would be extremely unwise and hurt
full"
Secretary McAdoo disclosed that he
intends to recommend to congress
later in the session constructive and
regulatory laws to prevent capital
from going into public or private en-
terprises unnecessary for the war.
TT may also become necessary" he
added, "to concert some constructive
measures through which essential
credits may be provided for those in
dustries and enterprises in the coun-
try essential to the efficient and sue
cessful conduct of the war. The sub
ject requires the best thought and
study. It is receiving the most ear
nest consideration.
1.-The courage and resources of the
nation are so abundant that Ameri-
cas- success in the war is beyond
question if they are properly or
ganized and intelligently used. The
economic and financial condition OF
the country was never SO strong and
Americas spirit was never more
aroused to the Importance and ne
cessity of going forward, resolutely
and regardless of sacrifice, to the &C
complishment of the great task to
which God has called u.s.
The Federal Reserve System re-
ceived Secretary McAdoo's enthusiast
tic praise for it's part in the war
financing program. He pleaded FOR
further strengthening of the reserve
system by the entrance OF state banKs
and trust companies.
Intelligent men all over the coun-
try" he said. 'are beginning to
realize that the financial power OF
the United States should be strength
ened to the utmost limit If we are to
meet successfully the tremendous
strain upon our resources occas1oned
by our own part In the war and by
the credits which it Is essential that
we should extend to the foreign gov
ernments cooperating with US in the
war and If we are to be equal to the
demands, in large measure, at least
of world leadership which will newt
ably be thrust upon us as a result Of
this war.
Financial strength can come from
a consolidation of the financial pow
ers of the country under one homo
ceneous system. 1t cannot be had un
! der the present arrangement, involv
| ing as 1t does 40 separate banking
systems or banking controls in the
| United States. In the federal system
we have the one cohesive and power
! full financial organization in the coun
try. In addition to the federal sys
| tenn we have 48 systems, unauthorized
! and administered under the laws o
| each Of the states Of the union. Thi
| is a serious element of weakness AM
| will be proven so when the test o
| a great responsibility and need comes
| We must be prepared, for a large
| measure OI lllLel lIo 'AOAAc'A uoAAAS"AAu uPol
! our resources In the future than eve
before in the past. Self-interes
! alone should compel every eligibl
state bank in the country to TAX
| membership In the federal reserv
system. But in addition to that, l.
this grave time Of national peril, pa
triotism should combine with self-in
terest to make them take that course
cit is my earnest hope that tn
state banks Of the United States wi
see this question in its proper ligh
They have been Joining the fedora
reserve system recently in create
numbers than ever before, but prog
ress should now be even more rapie
| The federal reserve law is now so lib