The Omaha morning bee. [volume] (Omaha [Neb.]) 1922-1927, 1922-10-31
Farm Credits
Deflaiion Begun
by Democrats
McAdoo's Campaign Claim
Refuled by Admission
Made in Article Writ.
ten by Him in 1912.

Washington Oct. 30.-ispeclall--
William y MeAdoo. former secretary
~ treasury, in a recent speech ~ Bii.
llngs. Mont was quoted by the As
ISOLATED Press as follows
This reduction of farm credits by
the present administration IN 60.
operation with tho powerful influ.
onces ~ Wall street" and the blight.
Ing effects ~ President iIardlng's
policies ~ deflation.' have reduced
The country from condition Of I'M
exnmplcd prosperity 10 n state o. mp.
raliing Disaster"
The Associated Press report of Mr..
.fcAdo0s meeting states
Mr. MeAdoo asserted that the re.
fiction ~ farm credits under the
republican administration had forced
the sale ~ farm products and live.
stock 10 such an extent that the value
" those products for the entire coun'
ny have teen. reduced from $4,000
100000 IN 1919 to S5,700,000,0o9 IN
la2l."
II hns hfen repeatedly shown from
The records that the policy Of defa.
lion Of fern credits VAS a policy
put into effect by The Federal Ige.
serve board when that board was
under the complete domination Of the
democratic administration when
every member ~ the board except one
Waa n democrat During the period
whom farm credits were probably sub.
lected 10 the most severe deflation;
hat r.. The period january 10 March.
1920. Inclusive, tbe membership of the
federal rtgcrye board was solidly
democratic.
Complete Before 1871
The deflatlon ~ farm credits had
heen completed ~ the lime the re.
publican administration came into
power In March, 1921 The shrink.
ago III value above referred % by
WI McAaoo was an accomplished fact
~ Mafct 1871 The agricultural
t,ona ~ the country we're facing
bankruptcy in March, 1921 From
nat month on, Tie situation became
,ers critical However, the best testi.
uony 70 tive Mr. McAdoo's Montana
speech the lie IL an article which
Mr.. McAdoo himself wrote under his
own signature In December, 1870 u
in the Manufacturers Re
cord, published at Baltimore, Md, In
its issue Of December 20, 1870
At that time slr. McAdoo said. over
his own signature, that the farmers
are now suffering colossal losses
as result Of the too drastic defa'
ton which had been put into effect by
the Federal Reserve board. AZ that
time, MIR. MeAdoo said: In many
parts Of the country, especially In the
agricultural districts, credit Is almost
entirely wanting and great losses
are being sustained because Of the re-
Nj riction Of credit" Mr. McAdoo In |
this article said he thought the Fed.
eral Reserve bank rates should be re 1
dueed. They were not reduced, how |
EVER, until the Harding administration |
came into power. At that time the /
+ ederal bank discount rate was IL
per cent, to which It had been raised |
by the federal reserve board under |
domination. Immediately !
after the Harding administration came I
into power the first reduction in this
discount rate was made and It was I
steadily reduced until II reached the |
rate Of 4 IL per cent. This
vas tho rate in December 1919, when l
line democratic Federal Reserve board !
began TO increase the rate in order |
10 force denation. The article which |
Mr.. McAdoo contributed 10 the Manu- |
Record December 20, 1920, /
In which he gives the lie direct TO |
MIR, McAdoo's speech in Montana /
October IS, 1922. said:
Policies Too Drastic.
4 am frank TO say that think that /
The policies thus far pursued with re
spect to credits have been too drastic, |
lut whether or not 1 am right, | am 4
.ure that the situation should now be /
reviewed in the light Of existing con-
lions. A more liberal policy about
credits should be put into effect i'm