Evening star., 1935-03-08
COUCHL|N FRIENDS
SPLIT ON BANK BILL
Senator Thomas Aids Ad-
ministration, Leaving Nye
Measure Supporters.
BY the Associate Press.

By the Associate Press.
A difference of opinion over parlia-
mentary strategy in banking legisla-
ton developed today between Senator
Thomas, Democrat of Oklahoma, and
Father Charles E. Coughlin of De-
troit, who have collaborated closely
heretofore on measures concerned
with money and credit.
Father Coughlin is pushing a bill
introduced by Senator Nye, Republic
an Of North Dakota, to create CEN
trail bank and have it take over the
Federal Reserve System.
Senator Thomas is friendly to the
bill, but is supporting, instead, the
measure presented by administration
officials to centralize control over
money and credit in the Federal Re-
serve Board. His support is based on
the theory that it is as big step as
can be taken now.
The disclosure Of this difference OF
opinion was the second of two new
developments to focus attention on
banking legislation. Last night sc
economists who are members of the
Economists National Committee or
Monetary Policy issued a statemen,
attacking the bank bill presented BY
the administration officials. They as.
serted that, if it were passed, 1t woulc
Invite ultimate disaster for thi.
country"
Sprague Signs.
Arcoor ~. s;rxnr~ ,x,~ Oy;y,r NJ Wy
Sprague Of Harvard. former specia
adviser to the Treasury, who resigned
because Of disagreement with admin.
istration monetary policy.
Senator Thomas said:
i am supporting the administration
bill because it goes as far as we car
60 at one time.
''It will take the power over money
and credit out Of the hands Of tht
The next time, We can get more. Bu
on the basis Of my legislative expert.
ence, our best procedure is to support
that bill now"
Thomas contended that to push {
more liberal bill now was playing int
the hands of the conservatives" anc
would result in defeating even the
proposal advanced by the admins.
tration officials.
The Oklahoma Senator also took is.
sue with one of the provisions in the
Coughlin-Nye bill, providing for the
popular election of the board to con-
troll the central bank. This provision
was placed in the bill by Fathe,
Coughlin.
"You might Just as well elect the
Supreme Court" Thomas said.
There would be more politics ir
that board than in a board selected
by the President and confirmed BY
the Senate"
The economists group attacked vir-
tually every major feature Of the
banking bill
Politics Deplored.
Provisions under which the Presi.
dent would be empowered to appoint
the governor of the Reserve Board
and remove him at any time were de-
nounced as making the board "politi-
cally controlled" and giving it little
opportunity to exercise independent
judgment"
"The proposal to repeal the require.
ments with respect to commercial pa
per collateral for Federal Reserve
notes is unsound," the statement con.
tinued. 1T will enable the Fedora
Reserve banks to issue legal tender
notes against frozen or illiquid asset,
under the tolerance or policies of 9
politically controlled Federal Reserve
Board"
The proposal that "any sound asset
be eligible for rediscount at the Re.
serve banks was denounced as opening
"the way to converting what should
be commercial banking system into
an illiquid non-commercial system"
The economists also found fault
with provisions for permitting long.
term loans on real estate and increas-
ing the percentage Of appraised value
which may be loaned.