The daily star-mirror. (Moscow, Idaho) 1911-1939, 1921-06-22
BANKERS REJOICE
OVER THE DECISION
SUPREME COURTS EMPHATIC
"CALL DOWN" FOR FEDERAL
RESERVE BANKS PLEASES.

That the federal reserve banks can
not force nOnmember banks to per
form valuable service without com
penSation;
That the federal reserve banks have
no power to use what is termed claw.
full methods" for unlawful purposes
That congress did not intend tC
legislate against non-member banks
That federal reserve banks have nc
right to use the power of the gov
ernment to force non-member banks
to join the federal reserve system
and
That when the federal reserve
banks use oppressive methods and un-
lawful procedure in attempts to COM
pei non-member banks to join the fed
eral reserve system or be ruined, the
non-member banks may appeal to the
courts for protection.
These are number of the main
points of the decision of the United
States supreme court in the case OF
the American Bank and Trust com
pany and others, appellants against
the Federal Reserve bank of Atlanta
Georgia and others, reversing the
United States circuit court of appeals
for the fifth circuit. Justice Holmes
delivered the opinion of the court.
Copies of the decision have been re-
ceived here.
This is by far the most sweeping
decision handed down recently in bank
litigation and sustains the contention
OF the non-member banks that the
federal reserve system was not crea-
ted Tor the purpose of permitting it
to be used as club to compel those
banks that remain outside to per-
sorm valuable service for the fed
sral reserve banks without compensa-
ion. In short, the edict of the fed !
sral reserve banks was that the non
member banks must accept the die
ates OF the federal reserve banks or
,e driven out of business.
In order to compel obedience to it's
mandates the federal reserve banks
Idopted methods that they contended
we're lawful" but which the state
anks insisted were unlawful" In
his the non-member banks have been
ustained by the supreme court of the
United States. The court makes plain
hat the United States did not intend
y the statute to sanction illegitimate
yarfare upon the legitimate creations
f the states, but more important
han all, by their decision the court
establishes that principle so funda-
lental to our Americanism that the
over of the government shall not be
sed by one class of citizens to their
dvantage and gain at the expense of ]
mother class and in concluding says:
If this were a case of competition
| private business, it would be hard
, admit the justification of self in
crest considering the now current
pinion as to public policy expressed t
statutes and decisions. But this is {
1t a private business. The policy of
lie federal reserve banks is governed
' the policy Of the United States
ith regard to them and to these
latively feeble competitors. We do
IT need aid from the debates upon q
e statute under which the reserve c
lnks exist to assume that the United
5ates did not intend by that statute I
sanction this sort of warfare upon
gitimate creations of the states. il
ecree reversed" v
Decision Meets Approval il
The Manufacturers Record, in re- v
mt issue, discusses the decision in
rms of approval, which seems to t
ice the sentiment of many business a
en- and commercial interests. The l
cord says: F
The Supreme Court of the United
ates has rendered decision against d
rtain acts Of the Federal Reserve n
'ard in language so strong that we
ubt whether any decision ever ut
red by that august body has been N
uched in words so vigorous.
In the face of the decision, Cover il
r Harding at once prepared, or had b
epared, a statement for the press v
which he ignored the courts over
lelming condemnation of the Fed a
Al Reserve Boards policy and dwelt
the fact that the decision itself d
lated to an issue of pleading, which o
IS true enough technically but not
1erwise. He then went on to say: k
/!
(Goptip1rod On ,ooo civ