Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-05-05


By the German that "in future we ought
to strive fer such adaptability in wage
scales and monopolistic commodity
prices to the business trend that regu-
iation of these would be comparable TO
the changes in the discount rates OF
the central banks"
commodities would then all harmoni-
ously change and the disturbance
/. e.. the periods of unemployment-be
both shorter and less extensive" he
said. =
Traylor, who is president Of the First
National Bank of Chicago, member OF
the ORGANIZATION Committee of the
Bank for International Settlements and
a former president of the American
Bankers Association, launched his at
tack before the International Chamber
Of Commerce at plenary session de-
voted to discussion of international eco
non1ic relations, in which he covered
the field of depression and unemploy-
mert in the United States.
Characterizing present conditions as
"unexcusable tragedy" Traylor told his
audience, composed OF several hundred
business figures from throughout the
world, that the cause was traceable to
the war, but that the extent was due to
lack of leadership in industry, COM
merce, finance, agriculture and govern
ment.
Blames "Laxity In Credit"
Oyerproduction and laxty In grant,
ing credits were laid at the door Of
business and finance in the sharply
worded criticism of the Chicago banker.
Responsible Government officials" kept
silent in the face Of the gathering storm,
he said, while the American farmer,
"lied to and lied about" he continued,
has been the victim of more false eco
nomic and political information, with
its constant destruction of public con-
fidence, in everything he Is and repre-
Sents, than has any other element in
our social structure" With all this, he
said, was the untrammeled stock mar
ket speculation.
The speaker also turned his shafts at
mounting Federal and State expendi-
lures, raped the "pernicious and Sc.
ductive influence Of so-called Federal
aid, which he asserted approaches
closely political bribery" in many in
stances, and called for taxation reforms.
Discusses Human Side.
Mr.. TrayIor declared at the outset of
his speech that he proposed to talk on
the human side of the problem"
IF it is the responsibility of business
and political leadership to promote the
economic and social welfare Of the COM
munity, IL may be worth while to take
stock to see how we have measured up
to our duty in recent years. he said.
why should there be in this land OF
plenty, with unlimited facilities for pro-
duction, abundant harvests and a sur
felt of credit, millions of hungry and
unemployed? 1t is not the fault OF
those who would work but can md no
work to do. They have little or no
choice in shaping their course, and
while it is true that society owes no one
a living, society does owe every one an
opportunity to earn a living. In that
obligation We have failed, and until we
know wherein we have failed and why
we will not have done our duty, nor
will we have found that stability which
is the universal desire Of mankind to-
day."
BIames Postwar Boom.
The way was paved for present con-
ditions by the postwar trade boom,
both foreign and domestic, Traylor de-
clared, bringing with it industrial ex-
pansion all out Of proportion TO future
requirements. =,
read the barometer properly, should
have noted the storm that was gather
ing and trimmed sail accordingly, but
ambition for place, power and proflt
blinded leadership to the obvious dan
gers ahead" he emphasized.
Business management, however. Is
fnr
has followed" Traylor continued. I'm
fortunately, it has had the cooperation
CT finance and Government, and Will
likewise have TO have their cooperation
in adjusting its affairs to a saner course.
What. in fact. did the leaders Of finance
do to encourage the expansion which
has taken place in the last decade?
What. If anything did they do to pre-
vent such expansion. with the conse-
quences which they certainly dld know
or should have known would follow? l
believe their record IN that connection
is net an enviable one. AS early as
1927 1t was clearly obvious to any one
having experience with the granting OF
credit that II the situation was allowed
to continue, and If expansion and specu-
lation were carried en- unchecked. there
would be but one end-disaster. Yet
the record of American financial lead
ership and of responsible Government
officials was regrettably one Of too much
silence. Few warnings were issued and
few attempts were made to attract pub
lie attention 70 the danger that threat
ened. Credit for the expansion OF pro-
ductive facilities to meet temporary de-
mands was granted to business without
adequate consideration Of the conse-
quences. Credit without stint was fur
n.shed to consumers to buy consumable
goods. thereby further increasing false
PURCHASING power and multiplying debt
No one called halt.
Hits Consultations.
Every kind and character OF combi-
nation and consolidation were made,
regardless Of their economic ACCESSIBILITY
or the possibility of economies in man
agement or increased profits therefrom.
Aiding and abetting, II not leading
the financial group was another group
upon whose shoulders must rest large
measure of responsibility for the pres
ent condition of the American eco
nonnic structure. Mr.. Traylor continued
Il refer to those responsible for the
MANAGEMENT Of the security and COM
modify exchanges of the country. I
have said before, and repeat, that I
believe security and commodity ex-
changes are necessary LOT the eI1cleUt
functioning Of American business.
have also said that American business
has paid altogether too great price for
the character of service we have had in
our attempt TO maintain a free market
for our securities and commodities.
I'm 50 far as can recall, this country
has not had a major depression in three
decades that did not follow a collapse
Of values en- the stock exchange. l do
not claim that these collapses-presup-
posing, Of course, periodSnpf speculative
activity--were wholly ponsible for