The Washington herald., 1918-04-15
The Aldrich- -Vreeland Act
II. Tru. Story Of How h Came to B. Enacted.


its were considerable. All this hap
pened, however, before actual contact
with disappearance OF currency had
made these and other men really
awake to the plight which this coun-
try was in, for lack Of an adequate
emergency currency.
The plan satisfied the three great
requirements for an emergency cur
rency. The first need at such times
In an ample supply Of money. Tho
peculiar feature of every financial
crisis In this country has been that
business men found banks unable to
make new loans or even to extend old
ones, because they lacked the funds
required. Bankers In the Old World
have learned that liberal lending at
such a time promptly alleviates the
situation. Through their banking
systems, they have had the money
necessary for this liberal policy. Mr..
Glover's plan was to acquire this
same power and helpfulness for our
own banks by setting s1,o00, 10000 as
the amount Of emergency currency
which could issue. The next need
Is that the issue shall be safe be-
yond question. and that the securi-
ty which accomplishes this shall be
readily available for the banks. This
end he would gain by allowing the
banks to pledge their holdings of pub
lie and railroad bonds with the Treas
urer of the United States, not restrict
ing them to United States bonds, be-
cause no sufficient supply Of them
would be available. United States
bonds were already pledged Tor the
ordinary currency OF the country.
Finally, the new currency must
promptly retire when the emergency
ceased to exist. It's failure to retire
would produce imitation. To prevent
this, his suggestion was that the
notes bear SO heavy a tax that no
bank could AFFORD to keep them in
circulation in any except extraordi-
nary times. That the plan was sound
and equal to what would be required
OF 1t we know now, because we have
seen 1t actually tested.
To obtain the enactment of the plan
into law. however. was much less
simple. In legislation, as in the world
of affairs, 1t is one thing to suggest
and quite another to accomplish. Only
an acquaintance with public men, Of
the intimate and deep-rooted sort
which the author of the plan pos
sessed, could have accomplished It
Those who recall conditions at the
Capitol in 1907 will not be surprised
to learn that the interview which
gave the plan its first real chance Of
becoming law was one with Speaker
Joseph g. Cannon. The two sat to-
gether in Mr.. Glover's own ONCE on
November II, 1907, when the details
were first laid before the presiding
officer Of the House of Representa-
tives. Mr.. Cannon was not the type
OF man to enthuse easily over pro-
tects for legislation. In his long life
he has seen too many brilliant sug-
gestions that have faded away under
the acid test OF practical needs. But
he was tremendously impressed with
this suggestion, and his comment was
that this simple plan had more COM
mon sense about II than any of the
host Of bills which had been present.
ed to the House Committee on Bank
ing and Currency. His practical mind
saw at once what must be done to
obtain an enactment of such a law.
The House he could answer for. He
knew its temper. The Senate must be
won. and won first. Mr.. Glover must
go to Senator Aldrich and obtain his
support.
That was q thing easier to suggest
than to achieve. The Senator had a
plan of its own, as / have already
said. To allow the plan of another to
engage his attention must represent d
considerable concession on his part
His first reception OF the plan was
not favorable. What finally won him
was recourse to a plan which Is
never wholly futile. Mr.. Glover en-
listed the aid OF the daily press. On
his own board of directors was John
r. Mclean, the owner of a daily pa
per of large influence. and when the
plan was broached to him, he at once
agreed that the huge power he pos
sessed for arousing popular support
for the plan should be utilized. He
assigned his best man, Ira w. Ben
nett, to the preparation of a leading
editorial, to be published in his paper
on the following Monday morning,
when Congress would convene. and
when this editorial would be read by
every member of the House and Sem
ate. This editorial, dictated in the
main by Mr.. Glover. and bearing the
suggestive title of "A Bill to Restore
Confidence" had an effect equal to
every expectation, for it not only pop
ulRriZed the plan, but it really won
Senator Aldrich.
1t must not be supposed that the
day was gained when the leader of
the Senate and the dominant figure
in the House had been enlisted. There
were many days of suspense and in
activity. Congress was wrestling with
those myriads of problems which
must be faced and settled at every
session. The end of the session was
actually at hand, and the bill not yet
enacted, when the most effective work
Mr.. Glover did in connection with the
bill was actually done. The Speaker
and Senator Aldrich appeared to have
lost heart by this time. They were
about to permit Congress to adjourn,
without any currency legislation, ex-
cept the creation OF the National
Monetary Commission. How futile
such a law as this would be to deal
with an emergency. IL such should
arise, almost any one can understand.
Yet somehow, in the fearful pressure
Of their daily work, these two leaders
Of Congress had forgotten how pro-
foundly shocked our people had been
by the panic Of 1907 and how necessary
1t was that their confidence in our
currency and our business structure
generally should be- restored.
A banker could not easily forget
something which was SO closely asso-
ciated with his own daily routine and
to Mr.. Glover, It was inconceiyable
that the law-making body of the
American people should adjourn and
leave those people defenseless against
another possible panic. His protest to
both the Senator and the Speaker
was emphatic, and he did not hesitate
to compile with It some vigorous
words of warning. He declared that