The Waterbury Democrat., 1935-10-05
By RODNEY BUTCHER Democrat washington
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 washington, Oct. 5-Not many | years ago a Morgan partner slun- bercd frequently at the White i House. The name of the great banking firm at Broad and Wall has always been Q familiar one in these parts.
 Never before, however. has the ] House of Morgan been the subject of so many backstage whispers in an administration or involved and .annoycd-in so many fields Of federal action. 'srhe New Deal versus Morgan" would be a plausible title. especial- ly to those democrats and progress | siyes who see the firm, with It's fingers in hundreds of corporations and utilities, as a bulwark of re- sctionary capitalism opposed to liberal reform. Anyway, no end Of people here are talking Morgan. One rcturIied' here to find gen. cral craning of necks toward that security graveyard" in New York where the Morgans were to auction l off collateral carrying control of the S3,0OO, 900, 900 Van Sweringen | on 8 $48, ,000, 900 1oan.
 The collateral, consisting of con- | trol. stock in a bankrupt company. presumably would be worthless to the buyers unless they could get the REC and IGC. to, agree to, a re- orga nization. plan for the Missouri Pacific which would leave, them in
 There has been plenty of sup pressed excitement over whether the Van ,Sweringcns would have the. seemingly essential support Of Jesse Jones in: their effort to re- tain control and whether the Vans wouldn't still be in hock to Nor gan with the $4S,ooo,o00 loan largely unpaid. z,+ .,'4'.r ..,'r't, Dig for Sensations
 Senate munitions committee ip- vestigators are still deep In the Morgan pre-war and wartime rec ords and act as if they would have something sensational to tell in few weeks.
 You'll be surprised to learn the extent to which personal fortunes of Morgan partners were pledged for the allies and. how important 1t was for them to have the allies wtn--though you won't learn that this led them to cgg Washington into the conflict. t1t,
 Possibly there,lI be some hereto. fore secret history of unfriendiy postwar relations between, Secre- tary McAdoo and Morgan. which will seem especially, interesting when you recall that fMcAdoo lost the democratic nomination in 1924 to a Morgan lawyer--a dark horse named John w. Davis f'A Y. = | Relations between the Mprgans and the Van Sweringens and cer- tain government officials are be- ing uncovered by the committee under Senator Wheeler, now inves- tigatrng1 railroad financing, which means more sensations coming up. Can't Stop Elm
 Creation of Morgan, Stanley i& Co.-operated and owned by Mor- gan partners and fronted by a son of I. P. Morgan himserfA-to caffy on a security investment business (from which the Morgan company itself Is barred as long as 1t en. gages in banking) caused sardonic comment here. Especially among such optimistic New Dealers as had thought, after Morgan lobby- ists were defeated recently in their attempt to change the law, they had ended the evils of combined commercial banking and invest ment banking. ,'af 1. l It is recalled that the law pro- l a solicitations without ICC approya! was, neatly eyaded when Wal street lawyers told the Vans-with Morgan floating their securities and acting as. their bankers-how to buy up control: of railroads by purchasing stock through holding companies. d %%
 Davis Goes Into Action E.
 Now comes John w., Days, tops among the expensive Morgan law yers, to challenge constltutionality of the public utilities act in the Baltimore federal court.
 1t may or may not be important to remember at ths point that the heaviest lobbying in the last days of the holding company bill fight was done on behalf of two Morgan companies, United Gas Improve ment and Commonwealth and Southern, in the hope that the new law could be made inapplicable to them-which 1t wasn't. }'
 But MT. Davis isn't appearing off, ficially for Morgan, U. c. l., Com monwealth and Southern or even the Edison Electric Institute, which recently hired him..
 He represents Mi. J.autenbach. a $250O creditor of the bankrupt Amercan States Public Service O.. g. holding company, and comes in to agree with counsel for trustees who say the law would interfere with reorganization, is unconstitu- tional, and should ,be thrown out.
 The Morgans are Interested in so many things that you'll probably never hear the last of them. They're fairly sure to appear, for instance, in the Investigation of the AmeEican Telephone & Telegram ph Co. by the, Federal Communications Commission. and that of the food Industries by the Federal Trade 1copyrisht. 1ss5.. NEA Service
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