Evening star. [volume] (Washington, D.C.) 1854-1972, 1939-07-02

The turmoil over the monetary BILL
which came to a climax at midnight
Friday, was precipitated by the Senate's
action five days earlier, although the
makings Of the fllibuster had been brew
ing long time. Today there is no
powerful sterilization fund.
Its $4,000, 00O, 000-plus profit has been
put back in the Treasury's general melt
ing pot. Also, the President does not
have the power, given him in 1898, to
change the amount of gold in the dollar.
All this the Senate has DONE
But the Senate's long night session has
not changed two other important powers:
The Treasury's broad authority to buy or
sell gold at any price it chooses, and the
extensive power to buy domestic and
foreign silver under the Purchase Act of
1884. Passage of that act, paradoxically,
was resisted by the New Deal in 1884
when Congress wanted it, and yet its
repeal the administration resists now
when Congress favors it.
further result of the silver stalemate
is that, without new action by Congress,
domestic-mined silver is legally at the
mercy of Treasury Secretary who is
opposed to all subsidies
Meanwhile, officially, the Senate still
stands on its action of June rs, when it
performed plastic surgery on the House
approved administration bill.
Laws Confuse Public.
Whereas domestic silver has been
acquired under the Thomas amendment
since 1888, foreign silver has been bought
under the separate 1884 law, a much
broader and permanent statute. The
existence of two silver laws has been
enough to confuse the public. The vague
terms of both laws have confounded it
still more.
Consider the 1884 act Under it the
Treasury was told it must acquire II,
billion ounces of silver To date it has
actually acquired about two billion ounces.
Yet, according to the same law there
still remained to be bought over one
billion ounces! Mechanically i'm
possible" you may say Yet it is true.
We have bought silver hand over fist.
at home and abroad, from friend and
foe alike. We have scattered hundreds
OF millions of wealth to the four winds.
We have bought domestic silver at
one price, foreign at another. We have
bought from governments. from miners,
from spectators. No one knows why.
Even some Senators who voted for the
law in 1884 now frankly ask why did
we do it?'
The secret is that we have seven
States that produce almost all our silver.
Seven States control one-seventh of the
Senate
So We started silver policy From
one standpoint, the policy was really not
so complicated. 1t may be restated as:
Buy silver. Buy, buy, buy; at home,
abroad, everywhere. Boost the price,
issue certificates; enrich the outside
world. Proclaim the monetization of
silver to cover up shameless holdup of
the Nation for the benefit of a few
Western silver producers, of mining-share
owners in the East as we'll as the West,
and of the spectators who unloaded on
Uncle Sam. And, incidentally, confer
benefits on foreigners in China and
Canada, Italy, Japan and Mexico
BY official figures of the Bureau of
Mines the silver program has already
cost us over $50 for every 81 of subsidy
received by American mining companies.
Aids the Warlike.
Under the curious silver program, the
United States actually helped Italy
finance its conquest of Ethiopia. 1t has
helped Japan invade China. 1t has
helped Hitler. While Mexico has seized
American-owned lands and oil properties,
raised its import duties on American
goods, and in other irritating ways has
done anything but reciprocate this Ma
lions good neighbor policy, the United
States has steadily bought millions of
ounces of Mexican silver monthly.
Under the 1884 silver law and present
policy, should Herr Hitler nationalize and
sell silver, our silver program is there
to help him do it, the while our State
Department seeks ways to stop him with
eCOIlOWlC pressure.
How neatly our silver program has
dovetailed into Hitler's plans NAV be
seen by the figures. During the six years
prior to 1884, when our act was passed,
Germany withdrew from monetary use
less than 7-million ounces of silver.
During the four years 1934-7 while we
supported the world price of silver, the
German government withdrew and de-
monetized 108 billion ounces!
Under the 1884 law there is simply no
way of telling how much silver still must
be purchased. In it the amount of silver
required by it's terms is linked to the
gold stock, which has greatly increased,
due in important measure to the devalu-
alton of the gold dollar.
Promises Elusive.
The two-fold domestic and foreign
silver policy could never achieve a single
promise of its advocates. Yet after five
years of costly experiment, the Presi-
dent publicly claimed it as one of the
pillars of his recovery program. And
in the Senate and the Hobbies of Con-
gress New Deal spokesman still defend it.
They want us to keep on buying Chinese
silver from Japan to keep the Nazis out
of Mexico.
Naturally, Mexico seeks to put the
worst possible face on the cessation Of
our silver purchases. We hear rumors
of more conf1scation of American prop
critics. Mexico would like to stay on