Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-01-09
B[AMES CONGRESS
IN BONUS MIDDLE
Glass Defends Banks for
Refusing Loans to War
Veterans.

Congress itself and not the banks
of the country are to blame if war
veterans find themselves unable TO
obtain loans on their adjusted com
pensation certificates, Senator Glass,
Democrat, of Virginia and a former
Secretary of the Treasury declared
in the Senate yesterday.
Senator Glass arose to call atten-
ton to the position of the banks on
this question of loans on veterans
certificates after Senator McKellar,
Democrat, of Tennessee had present
ed messages from his State indicating
that the veterans there could not get
loans.
Senator Copeland, Democrat, of
New York, reminded Senator Nc
Kellar Of the resolution which he had
adopted in the Senate yesterday call
ing on Secretary Mellon to advise the
Senate what plans the Federal re
serve Board has for carrying out that
section Of the adjusted compensation
act authorizing the use Of certificates
by the veterans in obtaining loans.
This prompted Senator Glass TO ask
Senator Copeland under what section
of the law banks are required to
make these loans.
Senator Copeland read a paragraph
which provided in substance that the
Federal Reserve Board could require
Federal Reserve banks to TediScount
the certificates.
Challenges Loan Forcing.
Senator Glass, in reply to this. de
clared that the law makes the certifi'
cate eligible for rediscount at a Fed
eral Reserve bank, after an individual
hu III hos Ia
tificate in the usual course of its
business, but he challenged the au-
thority Of Congress to compel bank
to make a loan to any particular class
of persons.
There seems to be an astonishing
misunderstanding of the attitude of
banks on this question and of the
powers Of Congress to require banks
to make loans" Senator Glass de-
clared. 81 doubt seriously whether
Congress could pass d valid law to
compel a bank to loan the money
of its depositorS to any class of per-
sons
Senator Caraway. Democrat, of Ar
kansas, Joined in the discussion with
the statement that every ex-service
man was led to believe his certificate
would be accepted as collateral for
a loan. He pointed out that 1t bears
on its face the amount the veteran
Is entitled to and for what length
of time. He commended that if the
banks are not going to make loans
on these certificates Congress ought
to do the only decent thing and
amend the law TO provide that an ex-
service man can bring his certificate
to the Treasury and get the face
value Of it."
Congress to Blame.
Resuming his remarks, Senator
Glass said that he had been opposed
to bonus legislation, but that if there
was to be such legislation he felt
the Government should have given a
cash payment. He asserted that those
who advocated this certificate plan
are attempting to pass the RESPONSE.
.bility to the banks. He declared
that the certificates are hedged with
so many restrictions that the loans
made under them are not liquid.
That is not the fault of the
banks" Senator Glass continued. cit
is the fault of Congress- It is not
fair now to hold the banks up as
being derelict in their duty"
Senator Glass said that he had no
doubt there are some banks with a.
surplus of funds that will be glad
to accommodate ex-service men with
these loans and then added:
IF Congress wants the veteran to
realize on these certificates il ought
to have the courage to appropriate
the money and place it at the dis
poSal of some Federal agency"