The Daily Alaska empire., 1935-06-11
More on the Banking Bill.
(New York Times.)

MT Owen D. Youngs testimony before the Sen ate subcommittee the Banking Bill, and the speech of MT. Ogden Mills to the Harvard Business School Club, provide in each particularly clear analysis of the objections to that measure as it stands. MT. Young spoke a member of the New York Reserve Banks directorate during a dozen years; MT Mills, as Treasury Secretary, has been a member of the Federal Reserve Board. Each opposed in all respects the much-converted Title IT." MT. Young bases his opposition largely on the fact that this altogether the wrong approach to the country's banking problem. He asks whether drastic changes in the superstructure" called for when the "soundness of the foundation" is not first considered in the light of experience with
 individual private banks since 1929-and indeed, he thinks, "by revision of whole banking struc- ture that i've may hope to correct the faults which have been disclosed" The pending measure is not the way to begin
 Both MT. Young and MT. Mills object to the bill upsetting in principle the main purpose of the Wilson Admnistration-the systems regional structure and regional responsibility subject to Fed eral supervison-and substituting what that Administration and the people of that absolutely opposed the establishment of a central bank MT. Mills recites clearly the changes which enactment of the bill in it's entirety would foreshadow. As it stands it's proposals largely impair the automatic character of currency expansion and contraction ' Tt destroys the autonomy of the twelve Reserve Banks" It changes the system from agency intended to accommodate industry commerce and agriculture into the instrumentality of a planned economy" Concedng willingly that the worlds oldest and soundest central banks cooperate will ingly and properly in essential Treasury policies he also shows has been shown before, that the Bank of England the Bank of the Netherlands and the new central bank of Canada privately owner and conducted; also that the Brussels con- ference of 1920 declared that banks, especially bank of issue should be free from political and should be conducted solely on lines of prudent finance"
 On less contested question MT. Mills speaks with authority. Regarding the talk of Re- framed under pressure from the Treasury, MT. Mills declares that in the twelve years beginning in 1921 he knows of instance of the kind In 1929, contrary to popular impression the influence of the Treasury at all times the side of the New York bank in it's endeavor to raise the dis count rate" His statement does not apply to
 1919, when it is matter of record that Governor Harding of the Federal Reserve afterward publicly set forth, both the board and the Advisory Council yielded against their judgment to the Treasurys urgent pressure against advance in bank rates. But he does not make the further point, he might well have done that each of those incidents serves argument against the idea of committing plenary powers Reserve Bank policies to the board as the Banking Act would reconstitute it or, inferentially, to the Government. In 1929, when the Treasury did not interfere, the board made a bad mistake in it's policy regarding discount rates Tn 1919 when Treasury pressure prevailed, the policy adopted similarly wrong On both oc- casions the judgment of the Reserve Boards based on their first-hand knowledge the credit situation but overrued at Washington proved by the course of events to have been correct