Evening star., 1937-07-24

for 1885 net additions to profits of
S So, ,49l 900 were reported and for
1886 S3l4 43 ,000-an increase Of 90
per cent over the previous year. In
other words. the earnings of 5,33l
banks for 1896 represent a gain of
$500. .259 900 over the deficit reported
by 5.159 banks for 1888
These really astonishing improve
mentS were brought about under the
controllership Of J. F. T. O'Connor,
who is, by the way, rated Washing
tons Number One Bachelor" for he
has never been married. He was ap-
pointed Controller Of the United States
Currency shortly after President
Roosevelt took Office in 1888. and was
unanimously confirmed by the Senate.
CuriouSly enough, he was not a
banker. but lawyer, from Los An
geles, Calf. Twice he declined the
appointment, and after the inaugu-
ration, returned to Los Angeles 10
resume his law practice But ne
finally accepted the Office and as
sumed his duties on May II. 1888.
O'Connor is graduate of the Uni
verslty of North Dakota, A. B, 1907;
Ii. B, 1908 He received another
law degree at Yale. as we'll as a mas
ters degree and taught in the aca-
demlc department of the university for
two years. In June. 1884, the Uni
versity of North Dakota conferred
upon him the honorary degree of
doctor of laws and a similar degree
was conferred upon him in June.
1885. by the Southern Methodist Uni
Versity at Dallas, Tex.
From Yale University OConnor
returned to North Dakota. He was
elected to the Legislature there in
1916, and reelected in 1918 without
opposition. He was nominated for
Governor on the Democratic ticket,
but was defeated. Two years later
he was candidate for United States
Senator and was defeated by an aver
age OF three votes in each precinct Of
the State. In 1924 he seconded the
nomination of William Gibbs Nc
Adoo for President, in Madison Square
Garden. The following year. he went
to Los Angeles and became McAdOo'5
law partner-a partnership that con-
tlnued for approximately five years.
after which he established his own
law firm in that city.
THE Bureau of the Controller of
the Currency was created in
1853, under the original National
Bank Act, during the administration
of Abraham Lincoln. 1t is the Oldest
Of all Federal banking agencies. pre-
cedlng by so years the esta abIishment
OF the Federal Reserve system The
first controller, Hugh McCullou2h.
came to Washington to oppose the
esta blIshment of a national banking
system, and remained to accept an
appointment at its head.
There have been several distin-
gulshed controllers, among them
Charles G Dawes, who later became
Vice President of the United States
and Ambassador to Great Britain.
In the opinion of the present con-
troller, there has never beer issued
a clearer or more concise etatement
OF the duties and functions Of the
Bureau of the Controller of the Cur
rency particularly as to its relations
with the Federal Reserve Board than
was presented by Mr Dawes IN his
annual reports to Congress in 1923
and 1924" In those reports, Dawes
stated:
Twice in great emergencies the
national banking system has been the
vehicle by which the Government car
rled forward its fiscal program, 1t
was not conceived to the end OF i'm
proving banking facilities but with
the primary purpose of creating an
lnstrumentallty by which the Gov
ernment could finance the Civil War.
1t was created IN a time of national
crisis, and no other governmental in
Strumentallty has ever rendered a
greater service than it did during
those critical days. Again, about so
years later. it was due to the national
banks that another crisis was success
fully met and passed Because the
Federal Government had authority
over the national banks, 1t was able to
create the Federal Reserve system.
This system was composed eXchl-
svely Of national banks until the
time arrived that its successful opera
ton was demonstrated. when the
no nj i,,,t, -
themselves of its resources upon ne
gotiated terms
The operation Of the national
banking system is under the most
rigid supervision, When a group
of individuals subject themselves to
this strict supervision and to the
laws requiring a rigid observance OF
fixed principles, it is to be presumed
that they should receive some COM
pensatlng advantages, and that such
privileges as they receive should be
Of permanent nature and not be
taken away from them in summary
manner. The independent representa-
ton IN the Government fiscal scheme
by the national banks was part of
the original contract, and While, for
the good Of the country at large, the
compulsory entrance of the national
banks into the Federal Reserve sys-
tenn can be justified, nothing can
justify their reduction from their fol-
mer independent status to one of
complete subservlency to an institu-
ton which is, in its nature, part pri-
vately and part governmentally con-
trolled The honor of the Govern
ment is involved in the observance
of all of the implications of any con-
tract which it made"
The controllers office now has jurls-
diction over 5,302 national banks, as
we'll as l3 non-natlonal banks in the
District of Columbia The national
bank examiners under the controllers
supervision go into 19 foreign coun-