Evening star., 1936-01-06
THE EVENING STAR WASHINGTON c. MONDAY JANUARY 1886
VANDERBILT CALLED
BY NYE COMMITTEE
Former National City Bank
President Faces Quiz
With Morgan.

BACKGROUND
The Nve committee in Septem-
Der, 1884, opened inuesttgation into
profits and practices OF munitions
makers. Considerable nt-paoe
testimony seemed likely to bring
little Legislative result until tDar
scare hit country last Summer.
Late but rigorous drtpe by neu-
trGiity bloc then resulted in enact
ment OF temporary law, effective
until merit month. BY terms OF act
President Is directed to declare EN-
barge OF pGr materials exports to
all belltgerents, but law fails to
make plain Ulaat are tDar materials.
BY the Associated Press.
Frank Vanderlip, former president
of National City Bank, was summoned
by the Senate Munitions Committee
today to join J. p. Morgan and Thomas
w. Lamont for questioning tomorrow
on the part loans to the Allies had
In bringing the United States into the
war.
Stephen Raushenbush, chief in
vestigator for the committee. said the
three would be Questioned together at
the reopening Of an investigation that
has previously covered munitions
manufacturers and shipbuilders.
Financing Firms Face Probe.
The committee has projected an In
quiry that will include Morgan a. Co.,
the National City Co., Kuhn, Loeb ds
Co. and Bonbright Co., all participants
in the Allied financing program that
preceded American entry In 1917.
Chairman Nye and Senator Clark,
Democrat, Of Missouri, co-author of Q
neutrality measure somewhat more
drastic than an administration bill,
both expressed the opinion evidence in
the Morgan case would influence the
course Of legislation to keep America
clear of war. The legislation will be
considered early this week In con-
sreSsional committees.
Bills 10 Close Harmony.
Their measure. though containing
some more mandatory features, was In
close harmony with the administra-
ton n-backed legislation than expected.
Nye and Clark felt there would be
an amicable agreement. They indi-
Gated they we're encouraged In this
by President Roosevelt's statement
that the United States Should do
naught to encourage belligerents.
Nye will give his neutrality views
at l0:30 o'clock tonight in the Ma
tional Radio Forum. sponsored by
The Star.
Besides providing for embargoes on
munitions and other essential war
materials. both the measures outlaw
transactions In this country In long
term obligations of warning nations.
They permit the President to sanction
only such short-time credits as are
normal in peace-time,
Morgan Files Long Scrutinized.
1t is the contention Of Nye and
Clark that when these financial mat
ters come under discussion on the
floor. the inquiry into the last wars
money deals will play its part.
Books and papers Of the Morgan
firm long have been under scrutiny
by the committees Investigators. The
State Department last September took
charge of truckioad of the accounts
in the capacity Of mediator between
the committee and the British and
French governments. Investigators
examined the documents In q vault at
the State Department because the for
eign governments objected to COM
mittee custody of the British Gov
ernment Treasury Account" and those
Of the "Compte de rAagence Com
merciale du Government Francais.
The accounts cover all business car
ried on by the Morgan firm for the two
governments between the outbreak of
the war and the time the United States
entered it. The financial houses con-
cerned contend their operations had
nothing to do with American partiei-
patton In the war.
Clark Sees Loan influence.
CldTk, however, SalQ.
Evidence will be brought out which
will leave no doubt Of the effect loans
and credits extended to the Allies had
on influencing American entry into
the war"
Nye said Morgan and his associates
will occupy the witness stand at
morning and afternoon sessions for
about two weeks, during q period
when the inomentous neutrality legis-
lation will be before both houses.
The two neutrality bills are vir-
tually parallel In requiring Q manda-
tory embargo on arms and munitions
for beligerents upon the outbreak Of
war. Where the present neutrality
act. expiring February 20, imposed
this embargo only upon the original
participants In . war, the new bills
would impose 1t upon all subsequent
belligerents.
The language differs widely in out
lining terms under which shipments
Of other goods usable In warfare would
be restricted to peace time quotas, but
both appear TO give the president con-
trolling discretion.
Nye Penalty Higher.
They also differ In describing re-
strictionS on credits to belligerents,
but appear to leave the effect much
the same.
The Nye bill contains one drastic
difference, o penalty of 100000 and
10 years imprisonment for violation
Of the neutrality act, compared with
$4,000 and years in the admins
tration measure.
Chairmen Pittman and McReynolds
of the Senate and House Foreign
Affairs Committees. respectively. would
authorize the President to require
shippers dealing with belligerents to
do so at their own risk, and place
on belligerent ships on their
own responsibility. without diplomatic
protection. The Nye-Clark bill would
fiatly forbid citizens from travelling
on belligerent ships, or on any other
ships passing through belligerent
waters. with the exception OF those
carrying passengers only.
A provision Of the Nye bill calling
for publicity on the amount of arms,
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