Willmar tribune., 1921-06-29
WASHINGTON
4. news LETTER
tRy Walter w. Liggett)

washington, D.. c., June 27-There
are some big figures in Wall Street
these days who are wondering if the
rapid "deflation'"' OF the farmers last
. 1all did not almost kill the goose that
Sialt the golden egggs,'' and whether
agriculture can be revived from it's
almost moribund tcondition. These
same men were quite gleeful 4 few
months ago when their manipulation
OF credit and Of the grain and cotton
exchanges was resulting in a drop in
the price Of farm products that was
ruinous to the farmer, especially as
they were reaping millions on these
transactions, but now that the boone
rang OF lessened purchasing power
has swung around ana hit their own
concerns staggering waffop they are
not so sure Of their Judgment nor so
proud Of their accomplishments.
Hurried conferences have been
called in Washington to see what can
be done to bolster up industry-and
the S. 0. S. has come direct from
Harding The President realizes that
he is holding the helm Of very leal1y
ship and he is calling inf"th best
minds" to consider how to save the
situation j. P Morgan and some
other big guns from Wall Street have
been at the White House several
times Of late and David Forgan Of
Chicago headed another bunch Of
middle western bankers who consult
ed with Harding late this week.
The President is frankly worried.
y He was elected on the slogan of ''Vote
for Harding and Coolidge and pros
perity for all' and it is very, doubtful
whether he saw the breakers ahead
before election. He probably shared
the naive belief which was 50 freely
expressed by many Of his big business
hackers that the mere changing OF
tenants in the White House would in
some mysterious manner "boOm busl-
ness Put it hasn't resulted that
way. Instead, business has steadily
gone from bad to worse and it cannot
be longer concealed that there is gen
uine alarm in industrial Circles
Republican politicians are not hap
py over tho situation, either. For gen
erat;ons they have carefully cultivat-
ed the theory that all nanics could be
tration, and this was given some
Dlausbility because the occasional
victories Of the Democrats seemed to
coincide with industrial depression.
CT cource the ~1an7 "Roosevelt pani:'
was not cOnrtCl. But now period
Of depression has Overtaken the Re
publican party and its leaders are
very fearful lest they be cordemnod
by their own logic.
Fedora! Reserve Blamed .
The condition of the country was
discussed without anv camoutlaGo in
the Senate the other dav by Smith OF
South Carolina and l1eflin Of Ala
bama. Smith declared cotton had
been forced down until it was selling
at half Of its cost Of production and
asserted that unless the country
banks Of the South got relief they
would be forced into liduidltiOn which
would "p2rticip1tc a crisis that every
man would be appalled, even to con-
tenl1late" F:videntlv hard times are
not confined to North Dakota.)
Senator Smith placed the blame
equ1raov upon the management Of tho
Federal Reserve system. "Here are
our ItuiStDtt!t:- tlt'ltt ,ttilli'ot dt tilE
same level that existed during tho
Deck of the cali for dellltiOn,' he
charced.~ 'Hero is our gold reserve
piling un every day, now approximate
ly 90 per cent when only 42 per cent
is required by law. Here they are
b0a5ting that our reserves in the
Federal Reserve system are higher
than ever before What would the
Senate think if the city Of Washing
ton were burning up and the fire de-
partment cOOl|v told us that it had
not used hvdrant, had not used any
fire hose. but that they had more wa
ter in the tank than ever before.
what is our financial system fol
il it is not to come to the relief Of dis
tressed commerce. in the situation
that now COnfrOnts us, tending toward
an appalling disaster? Why could not
the rate OF discount. based uron sta
pie and non perish1hle products Of the
farm, be lowered, the farm paper re
newed, the time extended, and these
people relieved until the market may
he adjusted and the normal flow O.
trade resumed? 1t is the paramount
duty Of the Senate to investigate the
financial situation, ascertain where