Evening star., 1932-11-02

economic recovery had been laid and
that I'VE will not have to wait much
longer for the dawn Of the day we
have been looking fer"
Referring to the House financial pro-
gram. Mills said:
"I knew that he GLASS disavowed
it. The trouble IS that the Democratic
party nominated the very man under
whose leadership that program was put
through for the great Office OF Vice
President-and, more important still
the Democratic candidate for the presi-
dency does not take his place along
side Senator Glass. He does not dis
avow it. Would he had the Senators
courage"
The Secretary contended the admin
istration did not encourage speculation
during the boom years OF 1923 ano
1929 In this connection he said An
drew Mellon, then Secretary OF the
Treasury, supported the policy of in
creasing the discount rates OF reserve
banks all during the Spring OF 1923
He added that In Febraury, 1929. the
Federal Reserve Board also issued 9
warning against the excessive use o,
credit for speculative purposes, and eau
not proper for them to make use Of
the rediscount facilities for the pur.
rose of making speculative loans OF
Eaaintaining them.
Mills declared this warning came or
top of one that had been issued In
June Of the previous year.
He asserted that the ensuing de-
preston had its or gin in vast specula-
tive movements that seemed to have
their fundamental impulse in human
nature itself" rather than in govern
ment or individuals.
Blames Unsound Practices.
Here was an immense movement,
Mills said, embracing a number OF
countries and derived from a great
variety Of causes having their origin
in many quarters, acting on and sup
plementing each other, and carried for
ward by an imponderable psychological
factor which impelled millions OF human
beings, suddenly free from the crush
ing and destructive influences of a
great war, urged to give full freedom tc
their creative and constructive i'm
pulses, and from that safe ground
gradually to drift on into the area
of speculation and unsound practices
Referring to Glass recitation that the
Reconstruction Corporation was a re-
creation of the War Finance Corpora
tion organized by the Democratic ad-
miniStration during the war, Mills asked
How does that detract in any way from
the bringing into being Of the Recon
Struction Corporation to meet the needs
Of great peacetime emergency"
why minimize the work Of the Ma
tional Credit Corporation, which repre-
sented a voluntary movement on the
part Of the banks of the country to hold
the line until Congress metz" Mills
asked. What is the use of saying that
it accomplished nothing? As a matter
Of fact, it made 1.217 loans to 958 banks
with credits aggregating $4,000 600.
1T saved many banks from failure
With its coming into existence the
number of bank failures dropped from
522 in October to IFS in November
Denies Secret Undertaking.
"The Senator suggests that some
secret undertaking was given to the
men who created the National Credit
Corporation. I was present at thai
meeting. l heard no undertaking given
What was said at that time was that il
the situation got worse end it should
look as if further measures were nece5-
sary. the President would recommend
the creation of the Reconstruction
Finance Corporation"
The Sacretarv disagreed with Senator
Glass and reiterated previous state
ments that the United States was in
danger of going off the gold standard
He said:
There can be no escape from the
fact that further drain on our cur
rency IN gold. as large and increasing
as rapidly as the drain of the previous
Autumn. coming on top of prolonged
period Of credit contraction and busi-
ness decentralization. would have set In
motion forces of destruction so great
that they might overThelm any country
no matter how strong its financial po-
sition might be
Il stand by that statement" he said
adding that under the leadership OF
President Hoover forces of destruction
were overcome.
To have given publicity to the real
situation would have frustrated the Sue
cess of the measures which were taken
to maintain the gold standard. and
would have brought on the distress
which was averted, he explained
The Secretary took exception to a
statement by Senator Glass that he
anu OtIleT CdDlnel O1nCerS opposed re-
duction in expenditures
Mills Points to Record.
He said:
The fact is that every reduction with
the exception of one Of $4,000 made
by the Appropriations Committee of the
Senate in the Treasury appropriation
bill was suggested by me personally, and
the record will support that statement
He said the Senator was dead wrong
when he said the bonus problem was
a legacy of ''sordid Republican politics.
In this connection he asserted the bonu.
bills were vetoed by Republican Presi.
dents, and were passed over their vetoes
with the help of Democratic votes.
Discussing fiat money, Mills said ht
knew Senator Glass would resist any
proposal to start the printing pres.
going" but added that the Democratic
party. controlling the House, did pass
such a measure
Some Republicans may be tainted
with the false doctrine of imitation ane
depreciation Of the currency" he said
but there Is this fundamental differ
ence. 1t was minority of the Repub-
licans, whereas in the case of the DEM
ocrats it was majority that favored
this proposal.
"On the question Of sound currency