The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1933-06-09
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National Topics Interpreted "a fTWFTTSSe
by William Bruckart @Epm1I3fT
plain about them i'm hard times.

try mat all or these new taxes coulu
be repealed If prohibition would be re-
pealed. They won't be in effect a
month longer than the Eighteenth
amendment, said the administration.
Taxes from liquor will more than
offset the levies lately put through by
congress, for the records show that
liquor taxes in the days before the
Eighteenth amendment was adopted
were yielding something like S35O,OOO,-
600 annually. The present addition to
the tax list will produce only an esti-
mated S225,00O,000, so there will be
some to spare if the old figures hold.
The country has just witnessed an
other 'show" staged by senate COM
mittee. This time,
obeMorgdnan investigation dis
c closed for the first
time the secrets of
the House of Morgan, the greatest pri-
vate banking firm the world has ever
known, and one about which there al
ways has been a veil Of mystery con-
cealing it's affairs from prying eyes.
The firm of ]. P. Morgan and company
is firm Of 20 partners; from the in
ception of the organization by ]. P.
Morgan, the elder, late last century,
people have known only that it was a
banking firm of immense power, Of
almost limitleSs resources and one not
subject to the laws governing CONNER
cial banking houses. The Morgan
partners, as their number increased.
always kept to the tradition that their
business was their business and that
despite the fact they constituted an
institution of enormous power, their
affairs should be treated like those of
any other individuals.
But the senate thought otherwise.
1t instructed its banking committee to
dig around and see what this giant in
finance was. 1t has found out. The
country has been shown, in presenta-
ton as dramatic as any great play
wright could have presented from his
Imagination, the naked truth about the
House of Morgan. The senate ma
jority that wanted to draw back the
curtain ON the Morgan bank are tickled
about the job. Ferdinand Pecora, q
Sicilian, who rose to considerable
prominence in New York city, likewise
is tickled about the job, for he was
the lawyer hired by the committee to
handle the case. And so another niche
has been cut by a senate investigation.
1t seems to me, however, that the
senate is not entitled to be praised
much for it's job. After all, it may
be asked properly what has been ac-
complished. 1t Exposed" the House
of Morgan, it is true. 1t showed that
J. P. Morgan, the younger, and the
present head of the firm, escaped pay
ment of income taxes in two years,
and it got coolies of publicity for indi-
vidual senators and Mr.. Pecora, as well
as smearing the names of some well
known persons because they once had
dealt with the House of Morgan. It
showed as well that Mr.. Morgan had
used his brains to comply with the
very tax laws congress enacted and
yet had escaped tax because he had
received no income as congress had
defined that word.
So there are good many observers
here who take the position that the
senate showed up itself almost as much
as it did the House of Morgan, except,
of course, in the matter of cold curl
osity. Those who were curious-I fear
that the bulk of the senator's were
about the affairs Of the House of Nor
gan have had that curiosity satisfied.
One result may be, and I believe II
is the only one, that there will be some
revision of the tax
Tax Revision laws to prevent re-
y;B,y,, currence of the cir
cumstance of one Of
the country's richest men escaping in
come tax. 1t is difficult to foresee
anything else of helpful nature that
can come from the "show" staged by
the senate committee. The reason is
practical and simple one. AS ex-
planned above, the House of Morgan
is private banking firm which by
long and honest operation has builded
confidence among the people of
wealth who deposited their money with
the private firm. 1t created good will
just as the local merchant in your
town has done, by preserving to those
who were its customers the rights they
were entitled to have. That local mer-
chant, by the way, could accept money
on deposit if he wanted to and his
customers wanted to make them.
There is nothing to prevent him
from it.
Thus, through the years, the Morgan
partners continued to receive funds on
deposit until at last reports there was
something like 1855, 100000 on deposit
with them. Like other big banks, the
House of Morgan made much money.
1t made vast profit doing what COM
mercial banks could not do without
having another corporation handle the
transactions, and that was sell securt-
ties.
Adverting, therefore, to the question
of what the results have been. it seems
to be the conclusion of many observ-
ers here that the investigation has
caused many people to fear banks and
bankers at time when one of the
greatest needs is confidence. They fear
! banks because they do not distinguish
between the banks of a general COM
mercial character like the state or
national bank in the local community,
and those like the House of Morgan.
They fear the little fellow may be
playing some tricks, and such feeling
is wrong. The fellows who play the
! big game take the big chances, and
they are able to lose if they do lose.