The midland journal. (Rising Sun, Md.) 1885-1947, 1935-03-22

Long and the talks of Huey
Cou0hI;o Long and F h err
Coughlin, the radio
priest, concerning plans for redistribu-
ton of wealth. The consensus has
been that their plans sooner or later
would fall of their own weight. But it
can be denied ne longer that Long and
Coughlin have developed gigantic fol-
lowing of people who lack information
as to the fallacies of the arguments,
however logical they sound, that have
been spread by these politically smart
showmen.
One reason that serious attention to
their proposals is now necessary is that
some of their arguments are being adj
vanced from higl places in the federal
government. refer specifically to the
testimony before the house committee
on banking and currency by Mariner
S. Eccles, governor of the Federal
Reserve board and as such the titular
head of the nations banking system.
Mr.. Eccles did not quite take a leaf
out of Huey Longs book. He APP
preached the position of the Louisiana
senator, however, when he proposed
redistribution of income, whereas Sen.
ator Long has urged redistribution of
wealth.
Mr.. Eccles suggested in his testimony
in effect that it would be all right for
a man with say ten million dollars in
capital to keep that sum, provided his
income was redistributed. Mr.. Eccles
went back to the days Immediately fol-
lowing the World war to illustrate his
argument and showed that at the top
of the postwar boom zone tenth Of one
per cent of the families at the top of
the income received as much as AZ per
cent of the families at the bottom of
the list" Furthermore he said that
the single average family in the big in
come class got as much as four hun
bred families at the bottom of the in
come list
"This one-tenth of l per cent was
unable to use all the income in con-
sumption" he continued. "They there
fore had to find an outlet in the in
vestment field AS a result, the capacity
to produce increased out of all proper
ton to the capacity to consume"
So Mr.. Eccles took the position that
a solution of the depression was a re-
distribution of this income with the
idea that it would increase purchasing
power in the lower brackets. The gov
ernor offered no explanation of how
those in the lower income class were
going to obtain possession of the redis-
tributed income of the rich because
his argument stopped at the point
where the government would take this
money by taxation.
That is the recognized weakness of
the programs advanced by Senator
Long and Father Coughlin, and Gov
ernor Eccles showed no ability to solve
the problem.
On top of the outbursts by Long and
Coughlin and the serious testimony by
Governor Eccles
Proposes comes Senator Nye
Central Bunk the North D a k o t a
progressive, with a
bill in the senate to create a central
hank. Senator Nye's action has caused
many humorous expressions. Here we
have a senator who has fostered, even
boosted about. progressive ideas and
has called himself liberal 1t is nee
essary only to recall that the father of
the central bank idea was the ultra
conservative Alexander Hamilton, the
first secretary of the treasury.
Senator Nye advances a bill with
the thought that the central bank
would avoid hamstring.ng of credit.
think financial experts all agree that
this is true The thing which Senator
Nye overlooked. however, is that Mr..
IIamiltOn's central bank collapsed and
brought ruin and grief to thousands.
The reason it collapsed was because in
removing control of the banking facili-
ties from experienced bankers. the
whole thing had been turned over to
the control of politicians who, general
~ speaking, are experienced only in
politics. II seems paradoxical that the
North Dakota senator should advance
central bank which one hundred and
fifty years ago represented the height
of conservatism.
The Nye legislation was offered in
the same week that Governor Eccles
had proposed in his testimony on the
banking bill in the house that the Fed
eral Reserve board should have COM
plete control of the credit expansion
and contraction in this country. be-
lieve most persons will have difficulty
in considering the two schemes as sep
crate and distinct.
1t is to be noted that there are at
least ninety-nine radical members of
the house of representatives who are
convinced that the federal reserve sys-
fem has failed of its purposes. Most
of them have been repeating without
rhyme or reason the accusation that
bankers are refusing" to make loans.
They think, therefore. that If there is
a central bank or If credit control is
y,laaod In tho raeorvo hos ri and taken