Emergency Banking Laws: Providing Relief to State Banks, Lecture notes of Law

Download Emergency Banking Laws: Providing Relief to State Banks and more Lecture notes Law in PDF only on Docsity! 1933 CONGRESSIONAL RECORD-SENATE 177 By Mr. SPENCE: A bill <H.R. 3060) to authorize the presentation of the Medal of Honor to John C. Reynolds; to the Committee on Military Affairs. By Mr. STALKER: A bill (H.R. 3061) granting an in­ crease of pension to Jane L. Morrill; to the Committee on Invalid Pensions. Also, a bill <H.R. 3062) granting a pension to Oscar B. St. John; to the Committee on Pensions. By Mr. STOKES: A bill (H.R. 3063) for the relief of Edna Broome; to the Committee on Claims. By Mr. STRONG of Pennsylvania: A bill (H.R. 3064) for the relief of Grant" William Moore; to the Committee on Naval Affairs. Also, a bill (H.R. 3065) for the relief of Harry R. Jones; to the Committee on Military Affairs. By Mr. SUTPHIN: A bill (H.R. 3066) for the relief of William J. Ryan, chaplain, United States Army; to the Com­ mittee on Claims. By Mr. TAYLOR of Colorado: A bill" <H.R. 3067) for the relief of Harry Brawner; to the Committee on Military Affairs. Also, a bill <H.R. 3068) granting an increase of pension to Douglas B. Jenkins; to the Committee on Pensions. ·Also, a bill (H.R. 3069) granting a pension to George Williams; to the Committee on Pensions. Also, a bill (H.R. 3070) for the relief of A. H. Sphar; to the Committee on Claims. By Mr. WARREN: A bill (H.R. 3071) to authorize a sur­ vey from Pamlico Sound to Mill Creek, N.C.; to the Com­ mittee on Rivers and Harbors. Also, a bill <H.R. 3072) for the relief of Seth B. Simmons; to the Committee on Military Affairs. PETITIONS, ETC. Under clause 1 of rule XXII, petitions and papers were laid on the Clerk's desk and referred as follows: 25. By Mr. CULKIN: Petition of the Chamber of Com­ merce of Alexandria Bay, N.Y., urging the ratification of the treaty providing for the development of the Great Lakes-St. Lawrence waterway; to the Committee on Inter­ state and Foreign Commerce. 26. Also, memorial of the Common Council of the City of Watertown, N.Y., urging the proper commemoration of the naturalization of Thaddeus Kosciusko, and his ap­ pointment as a brigadier general; to the Committee on the Post Office and Post Roads. 27. Also, petition of Edna Wiltse and 26 other citizens of Oswego, N.Y., urging the adoption of the so-called "stop­ alien-representation amendment"; to the Committee on the Judiciary. 28. By Mr. LAMBERTSON: Resolution of the Arthur N. Weir Post, No.7, of the American Legion, of Horton, Kans., urging the maintenance of the benefits already awarded to the ex-service men of the World War and the expression that disability benefits, whether incurred in actual battle or training camps, should be made to bear no more than their just share of such economy; to the Committee on Appro­ priations. SENATE SATURDAY,. MARCH 11, 1933 (Legislative day of Thursday, Mar. 9, 1933) The Senate met at 12 o'clock meridian, on the expiration of the recess. JESSE H. METCALF, a Senator from the State of Rhode Island, appeared in his seat today. PRESIDENT ROOSEVELT'S SUPPORT OF EX-SERVICE MEN Mr. ASHURST. Mr. President, the number of telegrams, regarding the national emergency, I have received within the past 2 days is so great that no conceivable office force at my command could make reply, although it is my rule to reply to every letter or telegram I receive. In order that LXXVII--12 the senders of the telegrams may not deem me discourteous in failing to reply-for it is impossible to reply to ali-I now read to the Senate a copy of a telegram I am sending to a few inquirers; and I ask all the senders of telegrams WhO receive the CONGRESSIONAL RECORD to treat this as a reply. WASHINGTON, D. C., March 11, 1933. Telegram received. President Roosevelt is the friend of the veterans of our various wars and he w111 deal justly and fairly with all the ex-service men. A crisis of tremendous proportions and with terrible results has been reached in our national destiny and all citizens must now make sacrifices for the country's wel­ fare. I know that the ex-service men whose valor and courage saved our country w111 follow President Roosevelt who is our leader, for we must and should grant him full power and au­ thority to act without restriction as the emergency arises. Presi­ dent Roosevelt is probably the best friend of ex-service men ever in the White House. He has suffered and knows how to sympathize with suffering. Please assure veterans and all others to trust him and follow his leadership for he needs your cooperation and help now. Please publish this telegram. Regards. Senator AsHURST. SPECIAL COMMITTEE TO INVESTIGATE AIR AND OCEAN MAIL CONTRACTS The VICE PRESIDENT. In accordance with Senate Reso­ lution 349, Seventy-second Congress, second session, creat­ ing a special committee of the Senate to investigate air mail and ocean mail contracts, the Chair appoints the fol­ lowing committee: Mr. BLACK, Mr. KING, Mr. McCARRAN, Mr. AusTIN, and Mr. WHITE. FUNCTIONS OF FEDERAL HOME LOAN BANK BOARD (S.DOC. NO.3) The VICE PRESIDENT laid before the Senate a letter from the Chairman of the Federal Home Loan Bank Board, transmitting, pursuant to Senate Resolution 351 (72d Cong., 2d sess.) , a report relative to the functions and cost thereof of the Federal Home Loan Bank Board, which, with the accompanying statements, was ordered to lie on the table and to be printed. RESOLUTION OF CONDOLENCE ON DEATH OF SENATOR WALSH OF MONTANA Mr. THOMAS of Oklahoma. Mr. President, the Legisla­ ture of Oklahoma has passed a resolution of condolence upon the death of the late Senator Thomas J. Walsh, of Montana. I ask unanimous consent that a copy of the resolution be spread upon the pages of the RECORD and noted in the Sen­ ate Journal. I send to the desk the original thereof. The VICE PRESIDENT. Is there objection? The Chair hears none, and it is so ordered. The resolution is as follows: House Concurrent Resolution No. 20 (By Graham, Anglin, Mrs. Davis, King (Creek), Batson, Boyer, Logsdon, Sullivan, and Coe, of the house; Fidler, Rutherford, Ray, Dixon, Stewart, Mac­ Donald, Morrison, Curnutt, Cummons, Whitaker, and Nichols, of the senate) A resolution of condolence over the death of Senator Thomas J. Walsh, of Montana God, in His infinite wisdom, has this day seen fit to call to Him, Senator Thomas J. Walsh, of Montana, and one of the Na­ tion's outstanding citizens. During his years of public service, Senator Walsh rendered invaluable service both to the citizens of the country and the Democratic Party. He was recently appointed Attorney General in the Cabinet of President-elect Franklin D. Roosevelt, and In our opinion the next President will find it difficult to replace this great lawyer and citizen, whose outstanding abil1ty, unimpeachable integrity, and Christian qualities were known throughout the world. The Nation mourns its loss. The State of Oklahoma bows its head in sorrow. Now, therefore, be it Resolved by the House of Representatives of the Oklahoma Leg­ islature (the senate concurring therein), That we express our appreciation of the loss to the Nation, the Democratic Party, and to the State; be it further Resolved, That we extend our heartfelt sympathy to his widow in her bereavement, and that a copy of these resolutions be en­ rolled upon parchment and delivered to her. Also, that a copy be sent to Oklahoma's delegation in the United States Senate for presentation to that body. Adopted by the house of representatives the 2d day of March 1933. R. P. FITzGERALD, Speaker pro tempore of the House of Representatives. Adopted by the senate the 2d day of March 1933. ROBERT BURNS, President of the Senate. 178 CONGRESSIONAL RECORD-SENATE MARCH ll CALL OF THE ROLL Mr. LONG. Mr. President, I suggest the absence of a quorum. The VICE PRESIDENT. The clerk will call the roll. The legislative clerk called the roll, and the following Senators answered to their names: Adams Clark Johnson Pittman Ashurst Connally Kean Pope Austin Coolidge Keyes Reynolds Bachman Copeland King Robinson, P...rk. Bailey Costigan La Follette Robinson, Ind. Bankhead Couzens Logan Russell Barbour Dale Lonergan Sheppard Barkley Dickinson Long Smith Black Dill McAdoo Stelwer Bone Duffy McCarran Stephens Borah Fess McGill Thomas, Okla. Bratton Fletcher McKellar Thomas, Utah Brown George McNary Trammell Bulkley Glass Metcalf Tydings Bulow Goldsborough Murphy Vandenberg Byrd Gore Norbeck Van Nuys Byrnes Hale Norris Wagner Capper Harrison Nye Walcott Caraway Hayden Overton Walsh Carey Hebert Patterson White Mr. BLACK. I desire to announce that the Senators from Illinois [Mr. LEWIS and Mr. DIETERICH] are absent from the Senate attending the funeral of the late Mayor Cermak, of Chicago. I also wish to announce that the Senator from Wyoming [Mr. KENDRICK] and the Senator from Montana [Mr. WHEELER] are necessarily absent attending the funeral of the late Senator Walsh of Montana. I also desire to announce that the Senator from West Vir­ ginia [Mr. NEELY] is necessarily detained from the Senate. Mr. HEBERT. I wish t.o announce the necessary absence of the junior Senator from Pennsylvania [Mr. DAVIS] on account of illness. I also desire to announce the necessary absence of the senior Senator from Pennsylvania [Mr. REED], the Senator from New Mexico [Mr. CUTTING], the Senator from North Dakota [Mr. FRAZIER], the Senator from West Virginia [Mr. HATFIELD], the senior Senator from Minnesota [Mr. SmP­ STEAD], and the junior Senator from Minnesota [Mr. ScHALL]. · The VICE PRESIDENT. Eighty Senators having an­ swered to their names, a quorum is present. THE JOURNAL Mr. ROBINSON of Arkansas. Mr. President, I ask unani­ mous consent that the Journal for the calendar days of Thursday and Friday, March 9 and 10, 1933, be approved. The VICE PRESIDENT. Is there objection? The Chair hears none. WORLD WAR VETERANS' COMPENSATION Mr. ROBINSON of Indiana. Mr. President, I have just received a letter from Charles L. Edgerton, chairman of the legislative committee, Morgan McDennott Post, No.7, Amer­ ican Legion, Tucson, Ariz., with which is inclosed a clipping from the Southwest Veteran, the official organ of the Amer­ ican Legion in Arizona. I desire to read a brief portion of the article: " I resigned from the National Economy League more than a month ago and General Pershing's resignation, I understand, be­ comes effective on March 4 ",was the statement made to the editor ·of the Southwest Veteran by Gen. James G. Harboard, Chief o! Staff of the American Expeditionary Forces and president of the Radio Corporation of America, in an interview Tuesday. Then I read further from the same article as follows: "When the Economy League was formulated", the general said, " Archie Roosevelt asked me to be the president of the organiza­ tion, explaining the purpose of the league. • • • I consented to join, but not to be an officer. Archie asked me to preside at the first meeting held at New York with 26 States represented. I called the meeting to order and asked for nominations for a temporary chairman. After this was done I left the meeting to fill another engagement I had. From that day to this I have had nothing to do With the league. I notice that my name has been used quite often by the opponents of the league and it became very embarrassing to me as a retired Army officer. I resigned a month ago." Asked whether he thought the league would be successful 1n their program to cut veterans' benefits: " I do not think that the league will succeed 1n the program of cutting veterans' benefits. When it was firSt organized I thought their purpose was to inves­ tigate and recommend cuts in other branches of government. However, I find that they seem to have centered on the veterans. I do not think that Congress has any intention of touching the veterans. Our country has always taken care o! its soldiers and I know it will continue to do so." MESSAGES FROM THE PRESIDENT Messages in writing from the President of the United States were communicated to the Senate by Mr. Latta, one of his secretaries. REGULATION OF BANKING OPERATIONS Mr. ROBINSON of Indiana. Mr. President, I desire to read a telegram which I have just received from banking institutions representing practically all the banks in one county of Indiana. The telegram reads: Senator ARTHUR RoBINSON, ANDERSON, IND., March 10, 1933. United States Senate: We believe the asset!? back of the smallest bank are assets back of our Government and should be eligible for same currency privi­ leges as those of the largest banks. We further believe the Federal Reserve System should belong to all banks alike and request that opening be postponed until equal privileges are accorded both State and National banks regardless of size, location, or class o! assets. We wish to enter a protest against today's publicity, both by air and press, as misleading and unfair to most banks and tne publlc. Financial future of this locality depends upon your sup­ port in this crisis. CITizENs BANKING Co. ANDERSON BANKING Co. ALExANDRIA BANKING Co. COMMERCIAL BANK & TRUST Co. (FRANKTON BANK). ELWOOD STATE BANK. FmsT NATIONAL BANK OF ELWOOD. SUMMlTVILLE BANK & TRuST Co. STATE BANK OF LAl'EL. PENDLETON BANKING Co. I merely want to suggest in passing, Mr. President, that this is only one of the results of hastening through legisla­ tion before it can be properly considered, and I trust that in the future no efforts will be made to rush through the Con­ gress of the United States any legislation that is only half­ baked and with reference to which the Congress is entirely ignorant. Mr. LONG. Mr. President-- The VICE PRESIDENT. Does the Senator from Indiana yield to the Senator from Louisiana? Mr. ROBINSON of Indiana. I yield to the Senator. Mr. LONG. I do not want to interrupt the Senator, but if he has concluded I should like to be recognized in my oWI1 right. Mr. ROBINSON of Indiana. I have concluded. The VICE PRESIDENT. The Chair recognizes the Sena­ tor from Louisiana. Mr. LONG. Mr. President, in connection with the re­ marks of the Senator from Indiana, I send a telegram to the desk and ask that it may be slowly and audibly read by the clerk so that Senators may understand its purport. It is representative of a large number of telegrams which I am receiving in common with other Senators. The VICE PRESIDENT. Without objection, the clerk will read as requested. The Chief Clerk read as follows: ARDMORE, OKLA., March 10, 1933. Senator HUEY LoNG: Opening banks on percentage or by selection wm finish wreck­ ing the whole system. Have Treasury issue scrip on safety paper same denomination as currency, distribute through Federal Re­ serve to all banks, allow checks on all accounts up to 75 percent paid with scrip. Accounts less than $5 to be paid in full. Hold 25 percent in all banks to insure solvency. Deposits must be guaranteed. What is a good bank now? THE AMERICAN BANK & TRUST Co. OF ARDMORE. Mr. LONG. Mr. President, I am not going to abuse the privilege given by having the clerk read further telegrams. I have in my hand a telegram from Los Angeles, Calif .• which goes on to show practically the same status; and I have received a number of similar telegrams from New York. I have in my hand a copy of today's New York Times con­ taining a report with reference to a legislative resolution of the General Assembly of the State of New York adopted 1933 CONGRESSIONAL RECORD-SENATE 181 Prefer present ban continued sufficiently to permit all classes of banks reopening, with all depositors equally protected; also objec­ tions postal savings facilities continued. KANSAS BANKERS' ASSOCIATION. I have received similar appeals from the governor of the State and from others, and I hope that they will have seri­ ous consideration by those in charge of the program. I want to see the State banks fully protected. Mr. FESS subsequently said: Mr. President, when the Senator from Florida asked to have inserted in the RECORD a telegram from Lima, Ohio, I tried to get the floor to state that I have received not only the same telegram but numer­ ous telegrams from various bankers and bankers' associa­ tions throughout the State, making the same sort of an ap­ peal that is made in this telegram. It appears that a great number of people in Ohio, as well as other places, have come to the conclusion that nothing will restore confidence except a bank guaranty law. I have tried to explain to the people back home the diffi­ culty of our entering upon that sort of legislation, at this stage of the matter at least. I desire to make this state­ ment so that my folks back home will realize that I have paid some attention to their communications, but I do not see any opportunity at this stage to do what they want. Mr. ROBINSON of Arkansas. Mr. President, it is natural that there should still exist confusion, uncertainty, and anxiety respecting the banking situation. My purpose is to take such action as will justify a revival of confidence. No matter what action this Congress might take, unless its decision be supported by the cooperation and good will of the banking managements of the country and of the pub­ lic, the state of confusion and fear which we are seeking to remedy will be in large measure perpetuated and con­ tinued. Now, there is complaint that the Congress acted hastily in the presence of an emergency. Now, there is complaint that revision of the banking laws of the United States was not effected in the emergency bill which we passed the other day. For many months there had been before the Senate, and for some time after its passage by the Senate before the House of Representatives, a bill known as the " Glass banking bill", which had for its object some of the purposes which it is now complained have not been accomplished. We found here influences and forces directed against the passage of that measure which are now appealing for the enact­ ment, as emergency measures, of many of the provisions which they resisted with all the power that they possessed. It is ·easy to make criticism, and by making ill-considered criticism one might retard the very progress which he thinks he is facilitating. Everyone turns to the Federal Government. I have had messages from State banking commissioners urging me to cooperate with the movement to require the Federal Govern­ ment immediately to take over every State bank in existence and to liquidate its assets. I do not know where such a proposition originated. It would seem that anyone would realize that the Federal Government has no such authority. It would seem that every citizen would know that the Fed­ eral Government cannot pay everybody's debts and at the same time relieve from oppressive taxation and maintain its own credit. There is a limit to what the Federal Govern­ ment can do. The State banks have had the option for years to enter the Federal Reserve System on fair, generous conditions. Many of them have exercised that option. Others having failed to do so, we were asked here, without any considera­ tion by a committee, substantially witho-ut consideration by the Senate, to permit the President to cover them all into the Federal Reserve System; and I say it imposes a physical impossibility. The amendment of the Senator from Louisi­ ana as first proposed gave the President the power to cover all States into the Federal Reserve System Without their au­ thority or consent. The amendment as finally amended required their consent. If you think, Senators, that this law needs amendment, do not try to prevent the effectiveness of the statute already passed. For God's sake, give the Government authorities all the opportunity they can have to go forward in the administration of the law in the most effective manner pos­ sible. Present your amendments, let them be studied, con­ sidered, and reported and I have no doubt the Congress will take fair action concerning them. Mr. BORAH. Mr. President- The VICE PRESIDENT. Does the Senator from Arkansas yield to the Senator from Idaho? Mr. ROBINSON of Arkansas. I yield to the Senator from Idaho. Mr. BORAH. I seek information in order that I may in­ telligently reply to the authorities of my State. I have' a telegram in which it is said: Secretary of Treasury sent Finance Commissioner Defendorf wire today in which he said that all banks are prohibited under Presi­ dent's proclamation from conducting any banking business except as specifically authorized by Secretary. We read the other day in the press that some of the That is plain enough. banks which had resisted to the death, secretly and by the That member banks wlll be reopened under his rule and orders, use of influences that are to be condemned in any decent but owing to lack of his information about State banks, that the assembly, their separation from their affiliates, and the dis- President wm by decree authorize appropriate State authorities continuance of the use of depositors' funds for speculative in each State to open for normal business, or, in their judgment and under terms of proclamation, they may .permit State banks purposes, now, when the opportunity has passed for a time, to reopen under restrictions. Then he advises that in so acting, come and ask the Congress, in an emergency measure, to the State authorities wm consider the general policy of Treasury reform the banking laws of the country and to incorporate to end that only sound banks be reopened. the very provisions which they condemned and resisted. What I desire to know is: First, is it the policy of the ad- We did what we thought was right, and we did what was ministration under this law to permit and require the State. right, in passing the emergency banking bill. It would banks to open only and alone after the proclamation has have imposed an impossible burden on the Chief Executive been issued by the National Government; and, secondly, does to have required him to exercise his discretion in covering, the National Government propose to exercise any authority in a blanket order or otherwise, the State banks into the with reference to the manner or conditions under which the Federal Reserve System. If the President had exercised such State banks shall open, or shall that be left entirely to the discretion in a way that would have been effective for the State commissioners and State authorities? encouragement of the State banks, it would have meant the Mr. ROBINSON of Arkansas. Mr. President, I do not feel complete wrecking of the Federal Reserve System, and every- that I can answer the Senator's inquiries with absolute au­ one familiar with the subject knows that that is true. thority. It is my opinion that the State banking commis- This bill that we passed as an emergency measure ex- sioners or supervisors, whatever they may be termed, will tended liberal consideration to State banks. It is true that have authority to reopen the State bank~. and that the con­ there has been a delay in the opening of banks; but when ditions under which they will be reopened will be determined the smoke clears away, and when the tumult and the shout- by the State statutes and by the orders of the local banking ing have died, I think it will be found that wise precautions commissioners, subject no doubt to fair cooperation, coordi­ have been taken; that every possible assistance has been . nation, and consultation with the national authorities. It rendered, under the terms of the bill and within the faJ.r would seem that would be the logical way. I assume the Sen­ discretion of the officers intrusted with authority, to encour- ator can obtain the information he desires by communicating age and assist the State banks. directly with the Secretary of the Treasury. 182 CONGRESSIONAL RECORD-SENATE MARCH tr Mr. BORAH. Mr. President, I desire to ask one further Oh, yes; the big banks resisted here and throughout the question. country the provision in the Glass bill .for a liquidatirig cor .. Mr. ROBINSON of Arkansas. Very well. poration, to the funds of which they were expected to con .. Mr. BORAH. Of course, I assume that the State authori.. tribute something; they opposed any guaranty of deposits; ties will seek to cooperate with the National Government. but now they have changed their minds, and they are asking What I desire to know is whether there is a contention to Congress to guarantee their deposits. I leave Senators to the effect that the National Government will or can require draw their own conclusions. anything more than cooperation such as the State may val.. Mr. BYRNES. Mr. President, will the Senator yield? untarily give. That is to say, the real authority in the State Mr. ROBINSON of Arkansas. I yield. rests with the State commissioner or other State authorities, Mr. BYRNES. If the Federal Government did guarantee as I understand it. It simply depends on what cooperation the deposits of all the banks, what would be the effect on they are willing to give in the matter. the Liberty bonds now outstanding? Mr. ·ROBINSON of Arkansas. That is my understanding. Mr. ROBINSON of Arkansas. Mr. President, I thought I Mr. ADAMS. Mr. President, may I in part answer the answered that question when I said that it would mean the inquirY by reading a portion of Secretary Woodin's procla- . immediate ruin of the Government's credit. The bonds of mation? the United States now in existence would, of course, be Mr. ROBINSON of Arkansas. I yield to the Senator. depreciated in value and price. The extent of the deprecia .. Mr. ADAMS. The statement from Secretary Woodin pub- tion cannot be anticipated. But the Government would not lished in the morning paper contains this heading, which the be ·able to refund the short-term notes which will be matur .. Senator from Idaho, I think, will find an answer to his ing within a few days. Everyone knows that. The Govern­ inquiry. It is headed" Orders to the States": ment would never sell another Government bond at par, so The following Instructions by Mr. Woodin to state banking su- long as it had guaranteed the obligations of institutions of perintendents were made publlc. questionable solvency. This follows: If you want to wreck your Government, if you wish to pull the last pillar from the temple and bring the ruins down All banks of the country are now prohibited, under the procla- mation of March 9 of the President, from conducting any banking upon your own heads, then enter upon a provision guaran .. business, except as specifically authorized by rule, regulation, or teeing bank deposits in State institutions. You would not license of the Secretary of the Treasury issued under that proc- have to wait until a black sunrise on tomorrow to see the lamation. result. You would witness it at once. Mr. LONG. Mr. President, the Senator from Arkansas Mr. GLASS. Mr. President, will the Senator yield? has just stated that the National Government has no juris- Mr. ROBINSON of Arkansas. I yield. diction over State banks. I would like to have him state Mr. GLASS. In answer to the question asked by the how the proclamation of the Secretary of the Treasury keeps Senator from South Carolina, may I remind the Senator the State banks closed. from Arkansas that the former President of the United Mr. ROBINSON of Arkansas. The order, I understand, States who retired on the 4th of March last, in response to was issued under a war-time measure. I believe it was an inquiry of that nature, gave it as his considered opinion entitled "Trading with the Enemy Act", and it has never that immediately, over night, the depreciation of outstanding been repealed. Federal bonds would be at least 50 per cent, that they would There are many legal questions which could be raised as not sell for 50 cents on the dollar. to whether that act is applicable during a time of peace, and Mr. ROBINSON of Arkansas. The statement of the as to what provisions of it might be applicable, but ·in order Senator from Virginia is correct. to. cure that defect, insofar as it was- practicable to do so, Mr. GLASS. I would ask the Senator, further, this ques .. in the bill which we passed day before yesterday we ratified, tion: Does he discover any reason why the American pea .. as far as the legislative authority had power to control the pie should be taxed to guarantee the debts of ·banks, any subject, the actions taken by the President. more than they should be taxed to guarantee the debts of Now I wish to say just one more word. Nearly all of other institutions, including the merchants, the industries, the telegrams we are receiving have relation to the insistence and the mills of the country? . upon a form of bank guaranty. I have not the slightest Mr. ROBINSON of Arkansas. Certainly not; and the very doubt that the people of the country are very much in sym.. people who are now insisting upon the United States' guar .. pathy with that idea, and that they believe that if the Fed.. anteeing bank deposits, both State and national, would be eral Government would guarantee the deposits in all the the first to tum in resentment on us for such action unless banks, conditions would be very greatly improved, and that it made the .guaranty more general. prosperity would be promoted. Mr. FLETCHER. Mr. President, will the Senator yield I have given limited study to the subject of bank guaran- to me? · ties. In every · State where such a policy has ever been Mr. ROBINSON of Arkansas. I yield. tried, it has proven .a failure, according to ·the information Mr. FLETCHER. It is not my idea that these proposals . I have. It was tried out in Nebraska a few years ago and are confined to placing on the Government the responsibility resulted disastrously. I have heard that it was tried out in and obligation of guaranteeing th.ese deposits. There are Oklahoma with the same result. · There are Senators pres- various proposals, some to require the banks themselves to ent who are better informed on the subject than I can claim protect depositors, by providing for funds which may ba to be. raised from contributions by the banks, contributions by the If the Federal Government started in to guarantee bank depositors, and contributions by borrowers. deposits, the first question which would have to be deter- Mr. ROBINSON of Arkansas. That is kindred to the pro .. minded would be this: In what banks will the deposits be vision in the Glass bill to which I referred a few moments guaranteed? Will the Government guarantee all deposits? ago, and which met with the resistance of the very forces If it guarantees all deposits, it immediately assumes a loss which are now seeking to commit the Government to a of billions and billions of dollars, as we all know, and, as a guaranty policy. result of such action, the Federal Government would be Mr. FLETCHER. That is the kind of guaranty which I threatened with bankruptcy and ruin immediately upon have in mind.· I do not mean to suggest that the Govern­ the enactment of the statute. If it limited its guaranty to ment should go into the guaranty business at all. the solvent banks, it would be doing very little that would Mr. GLASS. Mr. President, will the Senator yield again? be helpful to the public, and it would be taking the risk Mr. ROBINSON of Arkansas. I yield. of inctllTing great liabilities in the future. But, paramount · Mr. GLASS. If the Senator from Florida and other Sena­ to all that, it would be leaving undone the things which tors will examine their telegrams, they will find that 95 per .. those who are now urging an emergency bank guaranty cent of those who are insisting upon a guaranty are insist .. law are insisting upon. i.ng upon Government guaranty; and, as the distinguished 1933 CO-NGRESSlONAL RECORD-SENATE 183 Senator from Arkansas has said, when WP. proposed to levY an inconsequential assessment of one fourth of 1 percent upon the banks of this ·country to insure a prompt return of their money to depositors in closed banks, they came here with an organized monopoly to protest against that inconse­ quential assessment, an assessment which involved, in the last analysis, only one eighth of 1 percent. Mr. BORAH. Mr. President, may I ask the Senator who it was who opposed that particular provision? The opposition did not come from the people generally throughout the coun­ try, dig it? Mr. GLASS. It came from the bankers. Mr. BORAH. Exactly. Mr. GLASS. Upon whom we were proposing to levy the assessment. Mr. BORAH. I am not surprised that it came from them. Mr. GLASS. They organized a lobby against it, arid if the Senator will examine the hearings before the Committee on Banking and Currency, he will note that every banker who appeared there protested against that inconsequential assessment upon the banks. Mr. BORAH. I would expect that. Mr. McKELLAR. Mr. President-- The VICE PRESIDENT. Does the Senator from Arkansas yield to the Senator from Tennessee? Mr. ROBINSON of Arkansas. I yield. Mr. McKELLAR. Like all other Senators, today, and yesterday, and for the last several days, I have received a great many telegrams from my State in reference to the guaranty of bank deposits. I have asked these bankers this question in a telegram: Would banks be willing, in the event of guaranty of deposits, to pay as much as one fourth of 1 percent of their interest on loans, and charge their customers an additional one fourth of a percent on a general-guaranty fund? Would they, in addition, be willing to _pay 1 percent on savings deposits and one fourth of a percent on dally average balances of deposits in order to maintain a general-guaranty bank fund? It seems to me that if any guaranty at all is to be made, it should be made by the banks themselves. Mr. ROBINSON of Arkansas. Mr. President, while the Senator is telling us of the inquiries he has made to the banks, it would be interesting to have knowledge of their replies. Mr. McKELLAR. I have sent this telegram only in the last few moments; and when the replies come, I shall submit the replies, or some of them, to the Senate. Mr. ROBINSON of Arkansas. The Senator from Virginia was right when he said that if we correctly interpret the language of most of the telegrams which are coming in, we will find that they mean a guaranty by the Federal Gov­ ernment, and nothing else. Every telegram I have had on the subject, without a single exception, insofar as I can recall, has asked me to pledge the credit of the United States to the payment of the debts of banks, many of which are insolvent. Mr. President, I have sympathy with the depositors in these institutions, and I should like to be of assistance and service to them; but while we are yielding to such entreaties and demands, let us not forget that at this time it is im­ portant to maintain the integrity and the credit of the Gov­ ernment of the United States, and if we pursue a . course which further threatens or endangers national credit, we shall do far more harm than we should do by refusing to legislate in an ill-considered manner for the guaranty of bank debts-which it is known the Government will have to pay, in part, at least, if such guaranty shall be made. I recognize that there is no legislation, whatever may be proposed; that will immediately or quickly lift the clouds and let the sunshine through on all our people and their labors. But there is a fair and a necessary limit to the extent to which we should pledge the credit of the Federal Government, and in guarding that we are doing our duty, even though we fail to respond to the propaganda that is directed in almost resistless force and volume toward reck­ less action. Mr. President, I have consumed much more .time than I intended; I hope we will permit the authorities under the new statute to do everything that is possible to be done to ameliorate the situation. I trust that we will not ourselves by anything we say or do here hamper or unnecessarily burden them· in their efforts, for God knows the task is so great and the difficulties which they must overcome are so numerous that they require our heartiest cooperation and support. Mr. President, I yield the floor for the present, although it is my pw·pose to move an executive session with the .ob­ ject of having some nominations referred. Mr. VANDENBERG. Mr. President, I hope that motion may be withheld for the present. ' Mr. ROBINSON of Arkansas. Oh, yes; I withhold it, of course. Mr. VANDENBERG. Mr. President, it is not pertinent at the moment to indulge in attention to any phase of guaranteeing or insuring bank deposits, because the Con­ gress and the administration have decided to proceed for the time being in a different banking direction. But it seems to .me it would be very unfortunate if the subject were to be left where the able Senator from Arkansas has left it, because I should dislike to have the country mis­ takenly believe that at no point in a program for guaran­ teed or insured bank deposits is there any reliable, de­ pendable, sound, sane formula. Mr. ROBINSON of Arkansas. Mr. President, will the Senator yield? The VICE PRESIDENT. Does the Senator from Michigan yield to the Senator from Arkansas? Mr. VANDENBERG. I yield. Mr. ROBINSON of Arkansas. I thoug):lt it was made clear during my remarks that I supported the provision in the Glass bill which provides for a liquidating corporation and for a fund which is in the nature of a guaranty for de­ posits. I feel that the expense of any guaranty arrange­ ment ought in large part to be borne by the banks rather than imposed entirely on the. Federal Government. Mr. VANDENBERG. Mr. President, the provision in the Glass bill for liquidating corporations was a provision to deal with banks after they are closed. I favored it as a means to expedite liquidating dividends to unfortunate de­ positors. But it was a proposition in no sense analogous to the subject now under discussion. It was a proposition to close the barn door after the horse is stolen. There is no reason in the world why a more affirmative process can not lock the barn first, and it is to that proposition I wish to address myself. It is totally different from the liquida­ tion proposal in the Glass bill. I want to save depositors so far as possible from any need to be liquidated. I want them to know in advance that their money is safe. I think the Senator from Arkansas would readily con­ cede that I always attempt to dedicate myself in this body to sound finance and to the integrity of the Treasury quite as faithfully as he does. I think he will concede that I have already amply demonstrated my purpose to cooperate with the new administration upon every possible front. But, Mr. President, sound finance is not automatically at war with a proper program of deposit insurance, and coop­ eration does not require an abdication of judgment. Neither does cooperation nor a plea in the name of patriotism re­ quire Senators to yield up their convictions when those convictions are solidly based upon reason and not upon mere political or partisan indigestion. I propose to submit very briefly that there is a point at which it is not only pedectly safe, but at which it would be utterly wise to put the insurance of the Federal Govern­ ment behind a certain type of bank-deposit credits in the United States, not only for the sake of depositors but also for the sake of perpetuated American institutions. I concede at the outset that every State effort to guarantee bank deposits has been a total, abject failure and that the depositors in the banks which were relying upon the guar­ anties have been the chief victims of those failures. 186 CONGRESSIONAL RECORD-SENATE MARCH ll SEc. 4. No dividends shalf be paid by any banld.ng association while any participation certificates are outstanding, and all net earnings of the association from liquid assets, otherwise available for dividends, shall be closed annually into the trust fund defined in subsection (e) of section 2. SEC. 5. That portion of the deposits of any banking association against which liquid assets have been allocated, and all new depos­ its made thereafter shall be insured by the Government of the United States at 100 percent of their face value for 1 year !rom the date of this act. For this purpose an insurance fund shall be created and managed by the Federal Reserve Board, which shall have full authority to make all necessary regulations pertaining thereto. There 1s hereby appropriated $250,000,000 from the Treas­ ury of the United States for said insurance fund, or such portion as may be from time to time required. Each banking association qualifying within the terms of this act shall pay into the insur­ ance fund on August 1, 1933, an annual l>remium of 1 percent of the total amount of its average insured deposits for the pre­ ceding 3 months. During the period of 1 year from the date of this act no banking association shall pay more than 2 per­ cent per annum to any depositor with an insured deposit. The insurance shall attach to each insured deposit and shall be paid by the insurance fund within 30 days after the banking association may be closed by action of the comptroller. SEc. 6. After the expiration of 1 year from the date of this act the insurance fund shall continue to operate as defined in section 5 with the following exceptions: (a) It shall apply only to 75 percent of time deposits; and time deposits are defined as deposits which are under contract to remain, without waiver, for a period of 6 months, and which receive interest at the rate of not to exceed 2 percent per annum. (b) The annual premium to be paid on August 1 of each succeeding year shall be one eighth of 1 percent. SEc. 7. The insurance fund shall acquire all rights of insured depositors in the liquidation of any banking association until it has been reimbursed in full. SEc. 8. The Secretary of the Treasury is authorized, upon appli­ cation of the Federal Reserve Board, to pledge the faith and credit of the Government of the United States to bonds or other evi­ dences of debt necessary to provide any temporary funds required by the insurance fund to meet its obligations, such advances to be subsequently reimbursed from said fund. SEc. 9. Any State bank shall be admitted to the provisions of sections 5, 6, 7, and 8, when, in the judgment of the Federal Reserve Board, the State has provided by law for an allocation of assets as between liquid and nonliquid assets as generally defined in sections 1, 2, 3, and 4. In the absence of such law any State bank may become a national banking association, for the purposes of this act and under its terms, pursuant to conditions prescribed by the Comptroller of the Currency. SEc. 10. The interest on postal-savings deposits hereafter shall be at the rate of 2 percent per annum, and no new postal-savings deposits shall be accepted after May 1, 1933, at a post office in any city or village in which a banking association or bank is operating under the terms of this act. Mr. LONG. Mr. President, the Senator from Arkansas and the Senator from Michigan should not be disagreeing with one another. Their minds are one, and their hearts have only one beat. Under the regime that is proposed by the Senator from Arkansas the banks are all going to stay closed; under what the Senator from Michigan proposes, they are all closed now and will be again closed if they should reopen. That is the only difference between the two Senators. [Laughter.] Mr. ROBINSON of Arkansas. Mr. President, that may be an amusing statement to the Senator from Louisiana, and I presume he means it humorously, but it is a harmful statement. Mr. LONG. No. Mr. ROBINSON of Arkansas. But there is not a word of truth in it. Mr. LONG. The Senator may express his own opinion. Mr. VANDENBERG. I want to join in acknowledging the sense of humor of the Senator from Louisiana, but I deny his accuracy. Mr. LONG. That may be the opinion of the Senator from Michigan, and that may be the opinion of the Senator from Arkansas-and I give them credit for their opinions-- Mr. ROBINSON of Arkansas. What I stated is a fact. Mr. LONG. I stated it as an opinion and not a fact; but what has been done has put the shoulder of the Govern­ ment around such preferred banks as the Federal Govern­ ment is willing to allow to reopen or to take into the Fed­ eral Reserve System, and that means that all that are outside the breastworks will never again see the light of day. Perhaps the Senator from Michigan and the Senator from Arkansas do not know that to be a fact, but a week's time will prove it. Mr. VANDENBERG. Mr. President, will the Senator yield? Mr. LONG. Yes; I yield to the Senator from Michigan. Mr. VANDENBERG. I join with the Senator in his view of the probable effect of the legislation already passed; but he evidently failed to hear me say that the formula to which I addressed myself would apply equally to every bank in the United states. Mr. LONG. Then, the Senator is getting nearer the kingdom. Mr. VANDENBERG. The Senator from Michigan has ar­ rived in the kingdom. Mr. LONG. All right. Then I have only to convince the Senator from Arkansas that I am right. Mr. HARRISON. Mr. President-- The VICE PRESIDENT. Does the Senator from Louisiana yield to the Senator from Mississippi? Mr. LONG. I yield for a question. Mr. HARRISON. I thought the Senator was through. Mr. LONG. No; I am not half through; I am just fixing to start. [Laughter in the galleries.] The VICE PRESIDENT. The occupants of the galleries must observe the rules of the Senate and not express them­ selves in any way concerning the proceedings of the Senate. The Chair will repeat what he said the other day, that th'3 Senate is glad to have the visitors in the galleries as the guests of the Senate, but it is respectfully asked that they observe the rules of the Senate. Mr. LONG. Mr. President, I wish to make some answer to what the Senator from Arkansas has said, because I think we are really together in what we believe will happen. If on the coming Monday we open the banks that are selected-those which are supposed to be solvent-that will mean that those that are not opened on that day have prac­ tically been the same as condemned as insolvent, unsound banks, and they might as well never try to open, and they never will open. If the Senator from Arkansas does not know that, he only has a few days' time left before he will know it. I know that the banks that are not included in the Federal Reserve System and that are not permitted to open under the special order of the Treasury Department will never open again-99 percent of them, at least-unless they open up on the day that other banks are allowed to reopen under the proclamation of the President. There has been a great deal by way of confessed judg­ ment entered here against a bank deposit guaranty law; it has been said that it will break down the Treasury of the United States Government, and some Senators believe that to be so. The European countries owe us $20,000,000,000. It would not take the United States, Mr. President, at the outside, more than ten or twelve billion dollars, regardless of what kind of a catastrophe might ensue in this country, to guarantee bank deposits to the United States. It is con­ tended that thiS $12,000,000,000 will put the Government in a place where it can never walk another step; and yet today European countries which owe us $20,000,000,000 have prac­ tically thrown up the white fiag and said that they are not going to pay the $20,000,000,000, but nobody has said that that has sunk the ship of state or ruined the financial con­ dition of the United States. Mr. FLETCHER: Mr. President, will the Senator yield? Mr. LONG. I yield to the Senator for a question. The VICE PRESIDENT. Does the Senator from Louisian!l yield to the Senator from Florida? Mr. LONG. Yes, sir; I yield to the Senator. Mr. FLETCHER. Mr. President, the question is: Are we not rather premature in the discussion today of a bank­ deposit guaranty measure? I will say to the Senator that at the last session there were 4 or 5 bills introduced on that subject and referred to the Committee on Bankmg and Currency, and those bills have been under consideration there, but on account of the short time left of the session it was impossible to get a controverted subject such as that considered by the Senate. At this session other bills have 1933 CONGRESSIONAL RECORD-SENATE 187 been introduced looking to the same object. · I have intro­ duced a bill similar to one that I introduced last May and llave had it referred to the Committee on Banking and Cur­ rency. Though it may not be perfect, it will be developed at the hearings. The committee will hold hearings on this subject very soon, and I hope we can exhaust it in the hear­ ings before the com..'Ilittee. Then we will be in a position to discuss the question. The same objection I had to the Senator's amendment the other day I have to the other proposal. I should like to see a proposition like that referred to the Federal Reserve Board and to the Treasury Department arrd see what effect it woulrl have. I should like to obtain their judgment about it. I should like to have that kind of subject considered by the committee. I was afraid to deal with it instantly on the floor. The Senator may be entirely right about it, and yet I feel that such matters ought to proceed by reference to the committee, and then have the committee hold hearings, and give such consideration as they see fit to the question, before we are prepared to deal with it. Mr. LONG. I wish to say to the Senator that the Senate committee has had such bad advice on subjects of this kind and has uniformly followed such vicious precedents-and proven to be vicious-that I think we have got almost im­ mediately to settle it one way or the other here. The great trouble is that you are going out on Monday to open up the banks. You were going out yesterday, but you could not go yesterday and could not go today, and, we will say, to­ morrow you are going out to open up the banks. When you open up 10 percent of the banks--I have had some experi­ ence with matt-ers of this kind; I have opened up a few of them-and leave 90 percent of them closed, yon never will again be able to breathe the breath of life into the 90 per­ cent, and the chances are that they will burst the ones that you do open in the middle of the broken back. That is what. you are about to do. That is what the wiseheads of the Senate are about to do. They are about to go out, without thinking of one single other thing, and open up about 10 percent of the banks, and leave 90 percent of them closed, and try to maintain a banking system for the country with 90 percent of the banks closed, and the Daath Angel hovering over them on the morning the sunrise is supposed to have come. That is what this means. The Senator from Florida [Mr. FLETCHER] and I do not substantially disagree, but there are those, Mr. President, who have had control of banking legislation in the United States for the last 20 years. Mr. Eugene Meyer, Chairman of the Federal Reserve Board, Mr. Ogden L. Mills, the former Secretary of the United States Treasury, and men of his type, are today as influential as they were before the elec­ tion of November 8 last, when it comes to have their advice accepted in-I am sorry to say-some of our own councils; there is not any difference; the same men who sat and con­ ferred about the kind of financial policy that was going to govern this country-Mr. Parker Gilbert, of J.P. Morgan & Co.; Eugene Meyer, the chairman of the Federal Reserve, and Mr. Ogden L. Mills, together with the distinguished Senator from Virginia [Mr. GLASs]-have every one had their fin­ ger in the pie during the last 20 years. There has not been any difference in what they advocated then and what they are advocating now, and they are doing now just what they have done for the last 12 years. That is what is happening in America today. Why, Mr. President, when a prophet comes up and tries his experi­ ment, and it fails, he steps aside and lets somebody else have a chance. When a man comes up and undertakes to cure a patient who is sick and dying, and it seems that he has failed time after time, and the patient develops various and sundry other complications, they call in someone else to help restore the patient to life. Here in the United States the Federal Reserve System has been dominated and con­ trolled, and the financial structure of America has been dominated, controlled, and negotiated through a certain little clique, and it has brought this country to wreck and to ruin; and now we have the same set here giving us orders to close 90 percent of the banks in the United States and open up 10 percent. and we are still following that kind of prophet. That is what you are doing. Why send the matter to a committee? We ought to have brought this thing out in the open a long time ago. That is the trouble now. Had I been the President of the United States-and I guess it is a good thing that I never was-I never would have sent for Eugene Meyer, the chairman of the Federal Reserve Board. He has been here, the carcass hovering over the lives and fortunes of these people, for many, many years. He has been the raven that has said to the American people, "Nevermore!" He is here today. His philosophy today is embraced not only in the bill which we have passed, unless we amend it, but it was embraced in the Glass bill, to which the Senator from Arkansas refers. What was the Glass bill? I suppose the Senator means to say that the Glass bill might have been held up by some of the time some of us took in discussing it. I do not think we discussed it half long enough, but it did take several days thoroughly to discuss the Glass bill. I was in favor of some of the provisions of the Glass bill. I want the Senator from Arkansas to remember that I distinctly favored divorcing the affiliates from the commercial banks, and said so on the floor of the Senate time after time. There never was any disagreement at any time between me and my colleagues who favor that provision of the bill; but the Glass bill pro­ posed to close up all that were not in a chain-bank system by its effect though, not by its terms. The effect of the Glass bill in branch banking would have been that and nothing else. Now we are told by the Senator from Arkansas that it would be an impossible burden to take the 14,000 State banks into the Federal Reserve System. Why? Why? That is not my information. I understand, on fairly good authority, that the departments of the United States Government did not think they would have any trouble in looking over 14,000 State banks. I do not mean that it would not be a good deal of work; but I was informed, and I am willing to give the Senator from Arkansas, in confidence, the benefit of telling him who my informant was, and I think he will think it was direct enough, that they would not have opposed bringing them in; on the contrary, that they probably would have desired that the State banks be brought into this act. I wish to say that I think my information is just as reliable as any information that has been expressed on this floor; but it was the attitude of certain financial " master minds " who have been so prominent in financial legislation in the past 20 years, and therefore so prominent in closing banks during the past 20 years, that kept the State banks from being covered in this bill. I am told that the department would not have had any objection at all to their inclusion, and I do not hear that statement challenged. Now you are going to open some banks. The Senator from Arkansas has rendered a very well justified tirade against the big banks of the United States. That is another time that the Senator from Arkansas and myself agree. Every­ thing that he says against the way the big banks of this country have manipulated the legislation and the financial affairs of this country is justified; but which are you going to open? You are going to open up the big banks that the Senator from Arkansas says have been guilty of such mal­ practices that they ought to be condemned throughout the length and breadth of the country! And yet this bill pro­ poses to open them u pand to leave the little banks closed. You are opening up the big banks who have filled this coun­ try with German marks, and Argentine bonds, and Brazilian bonds. They have been responsible for breaking the little banks of this country. The little banks of this country could not have existed if they had not been willing to follow the dictates of the big banks in Wall Street; and yet, as a result of it, they have been depleted in their resources and in their assets, and you have seen them filched and imposed upon through the leading financial masters of this country; and now you are going to close the little banks that the people have had that have been guilty of no such practices as are charged against the big financial masters that are con- 188 .CONGRESSIONAL RECORD-SENAT:m 1\iARcH 11' demned by the Senator from Arkansas, and you are going to leave the big financial masters open today, and hang them above the people as a carrion for the future to close whatever other piaces of business the people are ever able to develop. I do not understand some of this logic. I wish to say, Mr. President, that I am trying to convince someone, somehow, of the necessity of not allowing this bank proclamation to be lifted without taking care of the banks of the States as well as these other banks. I am trying to do it in time. I am trying to tell you now, from bitter ex­ periences I have had, that you do not dare go out here in the United States on Monday and announce that you are going to leave 15,000 banks closed, and try to open up 4,000 banks. You do not dare go out here and say that you are going to leave 15,000 banks closed, but that you are going to try to open up 4,000 banks, because you will not only break the country by leaving the 15,000 banks closed, but the chances are mightily in favor of your breaking at the same time the 4,000 banks that you try to reopen. The Senator from Virginia [Mr. GLASS] makes the point that the Government ought not to be in the guaranty; but the Senator from Virginia has forgotten that" he stood on the floor of the Senate in the last session of Congress and tried to give $125,000,000 of the public's money out of the Treasury of the United States to this liquidating cor­ poration. He was in favor of that gift or that contribution at the time. It was so amended by the late Senator from Montana, Mr. Walsh, that the Government might draw certain earnings from it, I believe; but the Senator from Virginia was in favor of a contribution of $125,000,000. Mr. President, I realize that very likely nothing is going to be done. I realize that the death mask has already been put on the small financial institutions of this country. We are awaiting the day of execution. You have condemned us to death in order that there might be a survival of the select. Mark my words: You have condemned 15,000 banks to close in order that you can keep 5,000 banks open. Mark my words: The 5,000 banks cannot stay open any more than the 15,000 banks can stay open. Mark my words: If you think you are going to prefer one of these banks and enable it to stay open and compel another one of these banks to stay closed, the calamity, the terror, and the destruction that you are going to cause will so far outweigh anything good that you are even trying to do that within less than 10 days' time the mistakes of the Senate and of the Congress will be known throughout the length and breadth of this land. They are already known everywhere except here. The only place in America that has not recognized the dis­ astrous move that has been made is right in the Capitol itself. Outside of the Capital itself, there is not one tenth of 1 per cent of the population of America that does not know we are setting out upon a disastrous program, closing down 15,000 of only 19,000 banks; and I was told today by man after man heading some of these selected 4,000 banks that are to stay open-! was told by many of the men who are in charge of these supposed-to-be-select banks-that if this thing should go through without protecting the State banks, there was no chance under the living sun for them to stay open as long as 3 days' time. That is what I have been told. One banker from the State of ·Tennessee came to my room this morning and brought another gentleman with him-! will not call his name-and here is what he said: Everybody except Congress realizes that this thing is going to be destructive of everybody. Everybody recognizes 1t except Con­ gress. Now- He said- here is what is going to happen: I have a bank. I am going to open it. All of the little cor­ respondents are going to be closed. It 1s going to mean- He said- that when I undertake to open that bank, With every bank all around me to be closed, I Will not only not be able to accommodate the community but there will be no way on earth for me to stop the panic and fright of those people; and unless I have 1n the bank every dollar that I have on deposit, I do not even dare to open; and if I do open, I will be nothing but a liquidating concern. So we are going to close. We are going to close. We want you to know just what you are doing to us. We want you to know that we know it, and we want you to have all the warning on earth. We are going to close. That is what you have already done. We will have to stay closed. You will hang the crepe on the bonds of the States, because without having State banks in operation they will never be able to finance and pay the maturities and interest on the State bonds. You will close tl1e State banks; you will paralyze the State; you will ruin the State credit, and then they will close you, and then you will ruin the national credit. Remember what I am telling you. I do not know how Liberty bonds are marked up today, but I will tell you how they will be marked up in the future. Remember this: You have at last decided to inflate the currency. We asked you to inflate the currency to save all the banks, and you said it was an unsound thing to inflate the currency to save the entire banking structure; and no amount of argument nor pressure nor even filibustering could get the Congress of the United States to consent to inflate the currency. The Senator from Oklahoma [Mr. THoMAS] stood here day after day, arguing with the Senator from Virginia [Mr. GLASS], undertaking to conVince him and the Senate that we had to inflate the currency; and down and down and down went the commodity prices day after day, until corn was selling in the field for as little as one half cent a bushel! Then, all of a sudden, when every. bank had been closed, when they had had their way, when the voices of the Senator from Oklahoma [Mr. THoMAs] and the Senator from Montana [Mr. WHEELER] had rung through this Chamber and through this country, never heeded and never heard-no inflation, no silver, nothing could be done until they had closed every bank in the coun­ try-then they come back and say that THoMAS of Oklahoma was right, that we needed the inflation all the time, but that they could not let 19,000 banks subsist on it; they would let us have inflation to keep the 5,000 masters of finance alive, because they have squeezed out everybody else in the country, and nobody is going to be allowed to live except them. Food could not be had for the people, but it can be had for the financial barons. The land had become barren of a means of exchange to live upon, and when they had killed their neighbors, and their brothers, and starved their chil­ dren to death, broke their banks, depopulated their houses, wrecked their firesides, then they came and said, " Oh, yes, inflation is necessary, not to save the people .of the United States, but to save us, who have been guilty of the destruc­ tion from which this country is now suffering." That is the equity of what we are about to do. Yes; you are going to close us down. Yes; you have already closed us down, and have been doing it long before this year. Our President says that for 3 years we have been on the way to bankruptcy. We have been on the way to bankruptcy longer than 3 years. We have been on the way to bank­ ruptcy ever since we began to allow-the financial mastery of this country gradually to get into the hands of a little clique that .has held it right up until they would send us to the grave. Mr. President, there never has been any such example ever known of patience and tolerance of people as that of the American people during the last 16 years, as they have allowed the banks to play the funeral march, under the same chaplains and under the same marching squad that have financially and in all other material respects buried the prosperity of the people of the United States. In one grave they have been buried together. In one decree they have been condemned to an eternal financial wreckage. In 1 month we have been told that there could be no medium of exchange allowed under the United States Government, because, they said, if we inflate, it will destroy the credit of the United States Government. But today, 1933 CONGRESSIONAL RECORD-SENATE 191 Mr. ROBINSON of Indiana. Mr. President, reserving the right to object, I should like to ask the Senator what the emergency is that causes him to find it necessary to file the report when the Senate is not in session? We granted a request for unanimous consent the other day for the intro­ duction of a bill when the Senate was not in session. Why all this haste? Why cannot the bill follow orderly pro­ cedure; and, if the committee is not as yet ready to r~port, let the Committee on Finance report the bill on Monday, and then we will all have it before us? · Mr. HARRISON. I may say that the committee is ready to report; the report is now being drafted in order t~at the Senator and his colleagues may have an explanatiOn of every section and every item of the bill. The purpose of the request is to enable that information to be given to Senators. It is not an unusual request which I have made, but I do not want to keep the Senate in session here merely for the purpose of waiting on the draftsmen to prepare the report. I hope the Senator will not object to the very re~­ sonable request which I have made. Mr. LONG. Mr. President, I demand the regular order. Mr. ROBINSON of Indiana. Mr. President, I do not agree with the Senator from Mississippi that "it is not an unusual request," but I will not object. . The VICE PRESIDENT. The Senator from Louisiana declines to yield further. Is there objection to the request of the Senator from Mississippi? Mr. BORAH. Mr. President, I should like to ask one question. Mr. LONG: I yield for a question. · Mr. BORAH. May I ask the Senator from Mississippi if there have been any changes made in the bill? Mr. HARRISON. There have been no material changes made, I will say to the. Senator. The VICE PRESIDENT. Is there objection to the request of the Senator from Mississippi? Mr. McCARRAN. Mr. President, may I ask what is the request of the Senator from Mississippi? Mr. HARRISON. I merely ask that I may file a report during the present calendar day, even though the Senate should be in recess or should adjourn. · Mr. McCARRAN. The Senator asks unanimous consent? Mr. HARRISON. Yes. Mr. McCARRAN. I object. The VICE PRESIDENT. Objection is made. Mr. LONG. That ends that. Mr. GEORGE. Mr. President, the Senator from Louisiana [Mr. LoNG] offered an amendment on the evening when we were considering the bill. I offered amendments to that amendment which were accepted. I want to beg Senators' indulgence to say this for the RECORD: I would not under any circumstances give utterance to any thought or word that might increase the difficulties of our present unhappy condition, but I desire to say that through every influence I could exert at any point where I felt that it might be effec­ tive I attempted to do precisely what the Senator from Louisiana had in mind to accomplish by his amendment-to bring the State institutions within the purview and protec­ tion of the bill which we passed. I realized, Mr. President, that while there was no discrimi­ nation in point of direct provision against State institutions or private banking institutions, yet our whole financial struc­ ture is so intimately bound up with those State institutions that the omission of one element of that structure from the provisions of the bill and from the benefits given by the bill would probably prove disastrous. I hope that my fear is not well founded, but I desire at this point to say that as soon as I learned the bill was in process of formation I sought to bring within the protection of the bill, insofar as they could be so brought, the State institutions that are nonmembers of the Federal Reserve System. Mr. ROBINSON of Indiana. Mr. President, I would like to invite the attention of the Senator from Louisiana [Mr. LoNG] to this colloquy between himself and the Senator from Virginia [Mr. GLLASS], which took place last Thursday on this floor: Mr. LoNG. As I understand, the State banks, under the obser­ vation of my distinguished friend from Pennsylvania, are allowed to borrow from member banks. I should like to know about how much help they are going to get from member banks when they are closed today, and it is taking all the power of the Govern- ment to enable them to open. , Mr. GLASS. They are not going to get anything today, and they will not get anything tomorrow if this legislation is defeated here in the Senate; but if this legislation is enacted, they will have access to banks representing 64 percent of the resources of the Federal Reserve Banking System. It had to be done by midnight, and all Members stayed here and heard the Senator from Virginia make that state­ ment. It was assumed, of course, that a vote against the measure would make it impossible for the banks to open yes­ terday morning. A vote for it would permit the banks to open. They are still closed, I submit to my friend from Louisiana, and may be closed for some time to come. The legislation was rushed through as a result of statements made here by those who were at least charged with knowl­ edge that it would permit the banks to open the next morn­ ing; otherwise anyone who voted against the measure would impede the return of prosperity and the reopening of the banks. They are still closed. I think the Senator from Loulm~ has a great deal of company in this body who would join him in destroying their votes if they could. The measure was passed without anybody's understanding it at alL T hope nothing like that will ever again be attempted. Mr. GLASS. Mr. President, I simply want to say that when I made the statement just quoted by the Se1 ... ator from Indiana it was not as explicit as I felt authorized to make. I had definite information from the Treasury that the .banks would be open the following day, else I should not have made the statement. I do not relish the suggestion by the Sena­ tor from Indiana that I made a statement which I was not warranted in making. Mr. ROBINSON of Indiana. I simply quoted from the RECORD what the Senator from Virginia said. Mr. GLASS. Yes; but I am talking about the implica­ tion. I am getting a little tired of such implications here on the floor of the Senate. Furthermore, I desire to state for the RECORD that that was the purpose of the Treasury and that the opening of the banks was deferred only by reason of the fact that Senators who were fearful of the results upon State banks were im­ portunate in their representations to the Treasury and their insistence that banks should not be opened the following day in order to give State banks an opportunity to make appli­ cation to come into the Federal Reserve System in order that they might be more effectively protected. Mr. ROBINSON of Indiana. Mr. President-- - The VICE PRESIDENT Does the Senator from Virginia yield to the Senator from Indiana? Mr. GLASS. I yield. Mr. ROBINSON of Indiana. If that is the case then why did we 'not take enough time to study the legislation and give the State banks all over the country an opportunity to be heard in the matter, so they could be here to protect their own rights or at least send representatives here to set forth what protection they required as well as the big banks? Mr. GLASS. As a matter of fact, it was not my judg­ ment that the proclamation should be extended a day. It is not my judgment that the Federal Government has any right whatsoever to prohibit State banks to open today if they want to open under the authority of State law. It is my judgment that the State banks may obtain adequate facilities under the act already passed, that ten or twelve thousand of them may now appeal, under the terms of that act, to their correspondent banks and get the benefit of • the direct facilities authorized by the act and be assisted. Mr. LONG. Mr. President, I wonder if I could get the Senator from Virginia [Mr. GLASS], our financial prophet in these matters, to tell me bow many banks we will have open 10 days from now. I would like to get that in the RECORD if I could. 192 CONGRESSIONAL RECORD-SENATE MARCH 11 Mr. PITTMAN. Mr. President, I understand that while I was necessarily absent from the Chamber the Senator from Louisiana asserted that I had made some statement favor­ able to the amendment he offered to the Emergency Bank­ ing Act. Mr. LONG. No; I did not. Mr. PITI'MAN. I wish to say, then, that I voted against the amendment of the Senator from Louisiana. I . did not believe that his amendment should be offered at that time, because, as I understood it, the bill upon which we were acting had passed the House, and if we adopted any amend­ ment the bill would have to go to conference. I had the general impression that was given here on the floor that the reason for the hasty action on the bill was to pro­ vide for the opening of the banks in the country on the following morning. I was also informed that in the preparation of the bill at the White House there was a provision drafted intended to be inserted in the bill in the House, practically leaving it in the discretion of the President of the United States, upon the application of a State bank to become a member of the Federal Reserve System, to relieve as against the stringency of existing law and to permit temporary membership upon such conditions as he might prescribe. However, that was not incorporated in the bill in the other body and we passed on the bill in the form in which it was received by us. While such information was not received from any offi.cial or au­ thoritative source I know of no reason to question it. I did not believe that we should amend that bill, and I am of the same impression now, because it ·was presented as an emer­ gency measure that should be acted upon promptly. I would not have desired in any circumstances to have acted .upon the hasty and possibly unconstitutional amend­ ment proposed by the Senator from Louisiana. I did not think it was in the form contemplated by the original drafters of the bill. I still see no reason why that provision reported to have been drafted at the White House, and which if so drafted was undoubtedly approved by the President, should not be submitted to both bodies for a vote. Mr. LONG. Mr. President- The VICE PRESIDENT. Does the Senator from Arkansas yield to the Senator from Louisiana? Mr. ROBINSON of Arkansas. I yield. Mr. LONG. Mr. President, I wonder how much courage I can take from that apparently comforting statement the Senator from Nevada has made? I did not get my infor­ mation from the Senator from Nevada, although I had made a statement similar in effect to that which the Senator from Nevada has made. I got it, however, from another au­ thority. I did not quote any conversation or refer to any conversation the Senator from Nevada had with me. So I wonder how much comfort, Mr. President, we may take from the suggestion of the Senator from Nevada? Although the Senator from Arkansas has the floor, let me say that this is a momentous thing. The Senator f1·om Nevada has stated that he sees no reason why such a provision as I have indi­ cated should not be incorporated in the law; and I am wondering if I may ask the Senator from Arkansas what chance is there now of our putting it in the law? It would be a great thing for the people of this country if we could put that in the law, just as the Senator from Nevada has mentioned it, as having received the approval of the White House. Mr. ROBINSON of Arkansas. Mr. President, replying to the inquiry of the Senator from Louisiana, let me say that the statement of the Senator from Nevada was the first information I have received of any draft made at the White House or elsewhere having relation to the subject of which the Senator from Nevada spoke. Of course, I am not able to express an opinion as to the likelihood of the enactment of the provision, never having either seen it nor heard of it before. The description of it, as I think, is hardly definite enough to enable either of us to pass upon it. But I will say that I shall be glad to make inquiry about it and then to form an opinion when I have studied the proposal as to whether it is practicable to enact it. Mr. LONG. I am asking the Senator the question for this reason: We probably will recess this afternoon and not have an opportunity today for such a provision to be in­ corporated in the law. I have been familiar with condi­ tions on occasions when some banks or several banks have opened. I do not believe there will be the slightest objec­ tion to it, and if we had an opportunity of rushing an amendment through by resolution this evening, before ad­ journing or taking a recess~ it would be of material help in the opening of the banks. Mr. ROBINSON of Arkansas. I do not really know to what amendment the Senator from Nevada refers nor do I believe th.e Senator from Louisiana does. As I have just stated, I have not seen it. Mr. LONG. I understand what it is; I have my informa­ tion from other sources; but it is practically what I offered here on the .floor, though I did not know it at the time. Mr. FESS. Mr. President, will the Senator from Arkansas yield for a question? ·The VICE PRESIDENT. Does the Senator from Arkansas yield to the Senator from Ohio? Mr. ROBINSON of Arkansas. Certainly. Mr. FESS. I have had several inquiries from State banks in Ohio as to whether in order to open they would have to apply to the Federal Government as well as to the State government. I have been under the impression they would have to do so. Mr. ROBINSON of Arkansas. I am under the impression that the matter is subject to the control of the State au­ thorities, but an order having been issued· under the Trading with the Enemy Act by the Chief Executive, in all proba­ bility the practical procedure would be for the State bank­ ing authorities to advise the Secretary of the Treasury that certain banks are ready to open, and in that event I have no doubt in the world that whatever ban was imposed by Federal authority would be lifted. I may say further that I do not think there is any ground for questioning the good faith of anyone in connection with the passage of this legislation merely because the Treasury Department did not carry out its original purpose to open the national banks and member banks of the Federal Re­ serve System on the morning following the day we passed the bill. Every Senator was receiving messages from the State banks or from the State banking authorities asking that some arrangement be effected relating to the State banks; and it was that insistence principally whiph caused an extension .of the proclamation. The banks would have opened, such as could, if it had not been for the issuance of the proclamation by the President extending the original banking holiday. I believe it will be found, I will say to the Senator from Ohio, that the Treasury Department has acted wisely in taking a day or two to put into effect a measure which touches almost every community in the United States, and I think it probably would have had to do that in order to act prudently, wisely, and safely, no matter when we passed the bill. The passage of the bill as an emergency measure was fully justified, even though it has been found necessary and advisable since to prolong for a short time the period when the banks may be opened. Mr. VANDENBERG. Mr. President, will the Senator yield? Mr. ROBINSON of Arkansas. I yield to the Senator from Michigan. Mr. VANDENBERG. I want to say to the Senator that, for my part, I think it was exceedingly fortunate that time was taken beyond the immediate morning following the pas­ sage of the bill when we were supposed to have the banks opened. I only hope that enough additional time will still be taken to be sure that the opening is sufficiently safe so that it may be permanent. Mr. ROBINSON of Arkansas. I doubt the wisdom of doing what it seems some have in mind, to reopen the banks that are hopelessly insolvent whether they are State banks or national banks and to invite new deposits unless as to the banks of doubtful solvency that are reopened there is pro­ Vision, under proper authority, for the segregation and safe- 1933 CONGRESSIONAL RECORD-SENATE 193 guarding of new deposits. The desired object is not accom­ plished, the helpful purpose is not attained by the mere reopening of an institution that cannot function, even under normal conditions, for a prolonged period. Mr. LONG. Mr. President-- Mr. ROBINSON of Arkansas. I yield. Mr. LONG. Would the Senator let me offer a resolution­ it is rather crude; I just clipped it out of the CoNGRESSIONAL RECORD and put it on a resolution form-so that we might consider it and see what we can do with it? At any rate, we may discuss it. Mr. ROBINSON of Arkansas. I will let the resolution be presented, but I am going to move an executive session in a few moments. Mr. LONG. I offer the resolution which I send to the desk and ask that it may be read. The VICE PRESIDENT. Without objection, the resolu­ tion will be received and will be read by the clerk. The Chief Clerk read the resolution <S.Res. 22), as follows: Resolved, That upon such terms and conditions as the President may see fit to prescribe, either generally or for specific case or cases, any State bank may, with its consent, be declared a member of the Federal Reserve System and thereby receive all the benefits and protection of this act insofar as applicable to State banks, but under such conditions, ~uirements, and limitations as the President may prescribe. Mr. ROBINSON of Arkansas. Mr. President, I shall not object to the introduction of the resolution, but I shall ask that it be referred to the Committee on Banking and Cur­ rency. Mr. LONG. Very well. The VICE PRESIDENT. Without objection, the resolu­ tion will be referred to the Committee on Banking and Currency. PETITIONS AND MEMORIALS The VICE PRESIDENT laid before the Senate the follow­ ing joint resolution of the Legislature of the State of Ne­ vada, which was referred to the Committee on Banking and Currency: Senate joint resolution memorializing Congress to adopt the Pitt­ man proposal to accept silver on British debt Your memorialist, the Legislature of the State of Nevada, re­ spectfully represents that-- Whereas the proposal of the Honorable KEY PITTMAN, United States Senator from Nevada, that the United States shall accept the sum of $100,000,000 on the war debt of Great Britain to the United States embodies the principle that coined silver is money; and Whereas adoption of the Pittman proposal in the international transaction that he advocates would constitute recognition of sil­ ver as money by the two premier financial nations of the earth, and for that reason would go a long way toward its further and more general recognition as such, having the desirable effect of enhancing the value of silver everywhere, with the further and more desirable effect of being the forerunner of similar transac­ tions with other debtor nations, all of which cannot be otherwise than beneficial, tending to restore monetary equilibrium and banish the world depression: Now, therefore, be it Resolved, That the legislature hereby respectfully requests Con­ gress to adopt the Pittman proposal, authorizing and directing our President-elect to acc.ept such silver payment from Great Britain as soon after he takes office as may be expedient and possible. Resolved, That the secretary of state of the State of Nevada is hereby directed to transmit copies of this memorial by air mail to the President of the United States Senate, to the Speaker of the House of Representatives, and to the Members of the Nevada con­ gressional delegation at Washington. MORLEY GRISWOLD, President of the Senate. V. R. MERIALDO, Secretary of the Senate. FRED S. ALWARD, Speaker of the Assembly. GEORGE BRODIGAN, Chief Clerk of fhe Assembly. F. B. BALZAR, Governor. The VICE PRESIDENT also laid before the Senate a telegram from the clerk of the Senate of the State of New York, embodying a concurrent resolution adopted by the Legislature of New York, which was referred to the Com­ mittee on Banking and Currency and ordered to be printed in the RECORD, as follows: LXXVII-13 .ALBANY, N.Y., March 10, 1933. SECRETARY OF THE UNITED STATES SENATE, Sena-te Chamber, Capitol, Washington, D.C.: I am directed by the senate and assembly to transmit to you the following concurrent resolution, which was today adopted by unanimous vote of both houses: State of New York, in senate, Albany, March 10, 1933, by Mr. Cheney: Whereas, under the act to provide relief in the existing national emergency in banking and for other purposes enaded by Con­ gress on March 9, 1933, section 304 of title II, provides for the purchasJ of or loans against nonassessable preferred stock of na­ tional banks and State banks and trust companies by the Re­ construction Finance Corporation; and Whereas section 7 of article vm of the constitution of the State of New York prohibits the issuance of any nonassessable bank stock; and Whereas, therefore, the nonavailability of the said facilities of title m to sound and worthy State institutions may have the effect of working great hardship and discrimination against these State banking institutions; and Whereas title IV of the above-described act is not applicable to sound and worthy nonmember State institutions; now, there­ fore, be it Resolved (if the assembly concur), That the President and the Congress and the Secretary of the Treasury of the United States be urged to take action to clarify these provisions of title m so as to' correct any discrimination by authorizing the Recon­ struction Finance Corporation to make to worthy State banks, loans which shall be subordinated to deposit liability, or which by some other method shall preserve to the Reconstruction Finance Corporation the same character of lien as would be provided by the issue of nonassessable preferred stock; and, be it further Resolved, That the President and the Congress and the Secretary of the Treasury of the United States make available facilities similar to those referred to in title IV of the above-described act to sound and worthy nonmember State banking institutions, so that they may be permitted to reopen coincidentally with sound national banks; and be it further Resolved, That a copy of this resolution be telegraphed forth­ with by the clerk of the senate to the President and to the clerks of the respective Houses of the Congress and to the Secretary of the Treasury of the United States. By order of the senate. P. H. O'CONNELL, Clerk. In assembly March 10, 1933, concurred in without amendment. By order of the assemblY. Respectfully submitted. FRED W. HAMMOND, Clerk. P. H. O'CONNELL, Clerk of the Senate. The VICE PRESIDENT also laid before the Senate a joint resolution of the Legislature of the State of North Dakota, favoring the passage of legislation in the present banking emergency providing for the Government's taking over and exercising the functions usually performed by the banking system in such manner as to protect the rights and serve the interest· of the people, which was referred to the Com­ mittee on Banking and Currency. (See resolution printed in full when laid before the Senate by the Vice President on the lOth instant, p. 111, CoNGRES­ SIONAL RECORD.) The VICE PRESIDENT also laid before the Senate a reso­ lution adopted by members of the Socialist Party of America of Tompkins County, N.Y., favoring the passage of legisla­ tion socializing the banking system of the Nation, which was referred to the Committee on Banking and Currency. He also laid before the Senate resolutions adopted by the City Council of Brockton, Mass., and the Town Council of West Warwick, R.I., favoring the passage of legislation authorizing and directing the Postmaster General to issue a special series of postage stamps of the denomination of 3 cents, commemorative of the one hundred and fiftieth anni­ sary of the naturalization as an American citizen and ap­ pointment as brevet brigadier general of the Continental Army on October 13, 1783, of Thaddeus Kosciusko, which were referred to the Committee on Post Offices and Post Roads. Mr. FESS presented a resolution adopted by the council of the city of Columbus, Ohio, favoring the passage of legis­ lation authorizing and directing the Postmaster General to issue a special series of postage stamps of the denomination of 3 cents, commemorative of the one hundred and fiftieth anniversary of the naturalization as an American citizen and appointment as brevet brigadier general of the Conti­ nental Army on October 13, 1783, of Thaddeus Kosciusko. 196 CONGRESSIONAL RECORD-SENATE MARCH 11 By Mr. FLETCHER: A bill CS. 301) providing for the guaranty of bank de­ posits, and for other purposes; to the Committee on Bank­ ing and Currency. By Mr. METCALF: A bill CS. 302) to amend section 57 of the act entitled "An act to establish a uniform system of bankruptcy throughout the United States," approved July 1, 1898, as amended and supplemented, with respect to proof and allow­ ance of claims by trustees for bondholders; to the Com­ mittee on the Judiciary. By Mr. CAREY: A bill (S. 303) for the relief of Con Murphy; to the Committee on Claims. A bill (S. 304) granting an honorable discharge to Ed­ ward Barrett; A bill CS. 305) for the relief of William T. J. Ryan; A bill <S. 306) to grant an honorable discharge to Robert French Griffin; A bill (S. 307) to grant an honorable discharge to Claris proper time to Senate bill 233, and I ask also that they may be printed and referred to the Committee on Finance. The VICE PRESIDENT. Without objection, that order will be made, and the clerk will read, as requested. The Chief Clerk read as follows: At t he proper place insert the following new section: "After the enactment of this bill the Reconstruction Finance Corporation is directed to decline to make any loan to any insti­ tution or business enterprise unless an agreement is made that while such loan is outstanding and unpaid such institution or business enterprise will pay no salary or salary combined with bonus, in excess of the salary paid to Members of the United States Congress." At the proper place insert the following paragraph: "After the enactment of this law, the Postmaster General is directed to suspend payment of any air mail or ocean mail subsi­ dies, to any individuals, companies, or corporations which singly or in combination with other individuals, companies, or corpora­ tions receiving a subsidy, pay any salary or salary combined with bonus, to any one officer, agent, or employee in excess of the salary herein provided to be paid to Members of Congress of the United States." HEARINGS BEFORE THE COMMITTEE ON APPROPRIATIONS N. Corwine; and A bill (S. 308) to authorize the award of for distinguished service to Harry H. Horton; mittee on Military Affairs. a decoration Mr. GLASS submitted the following resolution (S.Res. 17), to the Com- which was referred to the Committee to Audit and Control the Contingent Expenses of the Senate: A bill cs. 309) granting an honorable discharge to Willard Heath Mitchell; to the Committee on Naval Affairs. . A bill (S. 310) granting an increase of pension to Me­ linda Morford; and A bill CS. 311) granting an increase of pension to Eliza­ beth Harrington; to the Committee on Pensions. A bill (S. 312) validating application for entry upon public lands; and A bill CS. 313) to amend section 5 of the act approved July 10, 1890 (28 Stat. 664), relating to the admission into the Union of the State of Wyoming; to the Committee on Public Lands and Surveys. By Mr. ADAMS: A bill cs. 314) to amend the act of Congress approved March 9, 1933, entitled "An act to provide relief in the existing national emergency in banking, and for other pur­ poses"; to the Committee on Banking and Currency. By Mr. KING: A bill CS. 315) authorizing the Reconstruction Finance Corporation to make loans to aid in refunding or refinanc­ ing certain obligations of irrigation and drainage districts; to the Committee on Banking and Cw·rency. A bill (S. 316) relative to the qualifications of practition­ ers of law in the District of Columbia; to the Committee on the District of Columbia. A bill (S. 317) authorizing the Reconstruction Finance Corporation to make advances to the reclamation fund; to the Committee on Irrigation and Reclamation. A bill (S. 318) granting certain lands to the State of Utah for use and benefit of the water-storage commission of such State and for the use and benefit of the University of Utah; to the Committee on Public Lands and Surveys. BANKING ACT Mr. GLASS. Mr. President, I desire to introduce a bill which I hope may be the basis for permanent banking leg­ islation, and ask to have it referred to the Committee on Banking and Currency. The VICE PRESIDENT. Is there objection? The Chair hears none. The bill will be received and referred as requested. The bill (S. 245) to provide for the safer and more effec­ tive use of the assets of Federal Reserve banks and of na­ tional banking associations, to regulate interbank control, to prevent the undue diversion of funds into speculative operations, and for other purposes, was read twice by its title and referred to the Committee on Banking and Cur­ rency. REDUCTION OF EXPENDITURES-AMENDMENTS TO SENATE BILL 233 Mr. BLACK. Mr. President, I send to the desk and ask to have read two amendments which I intend to offer at the Resolved, That the Committee on Appropriations, or any sub­ committee thereof, is authorized, during the Seventy-third Con­ gress, to send for persons, books, and papers, to administer oaths, and to employ a stenographer at a cost not exceeding 25 cents per 100 words, to report such hearings as may be had on any subject before said committee, the expense thereof to be paid out of the contingent fund of the Senate; and that the commit t ee, or any subcommittee thereof, may sit during any session or recess of the Senate. J. A. TIPPIT AND OTHERS Mr. STEIWER submitted the following resolution (S.Res. 18), which was referred to the Committee on Claims: Resolved, That the bill (S. 259) entitled "A bill for the relief of J. A. Tippit, L. P. Hudson, Chester Howe, J. E. Arnold, Joseph W. Gillette, J. S. Bounds, W. N. Vernon, T. B. Sullivan, J. H. Ne1ll, David C. McCallib, J. J. Beckham, and John Toles," now pending in the Senate, together with all the accompanying papers, be, and the same is hereby, referred to the Court of Claims, in pursuance of the provisions of an act entitled "An act to codify, revise, and amend the laws relating to the judiciary," approved March 3, 1911; and the said court shall proceed with the same in a{!cordance with the provisions of such act and report to the Senate in accordance therewith. HEARINGS BEFORE COMMITTEE ON EDUCATION AND LABOR Mr. WALSH submitted the following resolution CS.Res. 19), which was referred to the Committee to Audit and Con­ trol the Contingent Expenses of the Senate: Resolved, That the Committee on Education and Labor, or any subcommittee thereof, is hereby authorized, during the Seventy­ third Congress, to send for persons, books, and papers, to ad­ minister oaths, and employ a stenographer at a cost not exceed­ ing 25 cents per hundred words to report such hearings as may be had on any subject before said committee, the expense thereof to be paid out of the contingent fund of the Senate; and that the committee, or any subcommittee thereof, may sit during any session or recess of the Senate. DELEGALIZATION AND PROHIBITION OF WAR Mr. KING submitted the following resolution CS.Res. 20), which was referred to the Committee on Foreign Relations: Whereas permanent peace is essential to the happiness and welfare of the human race, and civilization would be jeopardized by another world war; and Whereas all people earnestly desire that international conflicts shall cease and that war shall not only be renounced as an in­ strument of national policy but outlawed by all civilized nations; and Whereas both political parties in their national platforms have approved our adherence to the Permanent Court of International Justice and the adoption of policies of conciliation, consultation, and conferences in case of threatened violations of treaties for the purpose of preventing war; and Whereas the cause of world peace would be advanced and made more certain by an enactment that would be an integral part of international law: Therefore be it Resolved, That the President be requested to enter into negotia­ tions with all civilized nations for the purpose of securing the adoption of measures and enactments for the delegalization of war that will make the prohibition of war between sovereign nations a basic principle of international law, remove from the 1933 CONGRESSIONAL RECORD-SENATE 197 protection and place under the condemnation of law as an in­ ternational criminal any nation that, in violation of its treaty obligations, attempts to settle disputes by war, and by which any possession or gain thereafter acquired by any other than peaceful means shall be held an illegal possession subject to recovery under such measure or law so enacted. INVESTIGATION OF CONDITIONS IN SOVIET RUSSIA Mr. KING submitted the following resolution (S.Res. 21), which was referred to the Committee on Foreign Relations: Whereas extensive propaganda has been circulated urging recog­ nition by the United States of the Russian Soviet Government; and Whereas early in the history of the Russian · Soviet Government the United States announced a policy of nonrecognition of such Government so long as conditions then existing and policies then adhered to continued; and Whereas this policy of nonrecognition has been steadily adhered "tO by this Government; and Whereas before the Government of the United States should take any steps looking to the recognition of the Russian Soviet Government or the adoption of a different policy than that here­ tofore adhered to, a full and complete investigation should be made of all matters bearing upon the question of recognition: Therefore be it Resolved, That the Committee on Foreign Relations, or any duly authorized subcommittee thereof, is authorized and directed to make a full and complete investigation of economic, political, and other conditions existing in the Union of Soviet Socialist Repub­ lics, including the position of the Russian Soviet Government with respect to recognition by the United States of such Government, the attitude generally of the Russian Soviet Government toward the Government of the United States and other governments, and any other facts bearing upon the question of recognition of the Russian Soviet Government. The committee shall report its find­ ings to the Senate at the earliest practicable date. For the purposes of this resolution the committee, or any duly authorized subcommittee thereof, is authorized to hold hearings, to sit and act at such times and places during the sessions and recesses of the Senate in the Seventy-third and succeeding Con­ gresses until the final report is submitted, to employ such cleri­ cal and other assistants, to require by subpena or otherwise the attendance of such witnesses, and the production of such books, papers, and documents, to administer such oaths, and to take such testimony and make such expenditures as it deems advisable. The cost of stenographic services to report such hearings shall not be in excess of 25 cents per hundred words. The expenses of the committee, which shall not exceed $ , shall be paid from the contingent fund of the Senate upon vouchers approved by the chairman. EXECUTIVE SESSION Mr. ROBINSON of Arkansas. Mr. President, I move that the Senate proceed to the consideration of executive busi­ ness; and let me say before the motion is voted upon that cnly a short period will be required to transact executive business this afternoon, and following that there will be an announcement which will grieve the Members of the Senate very profoundly. The VICE PRESIDENT. The question is on the motion of the Senator from Arkansas. The motion was agreed to; and the Senate proceeded to the consideration of executive business. The VICE PRESIDENT laid before the Senate sundry messages from the President of the United States transmit­ ting nominations, which were referred to the appropriate committees. (The nominations received this day appear at the end of today's Senate proceedings.) Mr. ROBINSON of Arkansas. I move that the Senate resume legislative session. The motion was agreed to. DEATH OF SENATOR HOWELL, OF NEBRASKA Mr. NORRIS. Mr. President, it is my sad duty to announce the death of my colleague, Hen. RoBERT B. HoWELL, who passed away just a few minutes ago at Walter Reed Hospi­ tal. I send to the desk the following resolutions. The VICE PRESIDENT. The resolutions will be read. The Chief Clerk read the resolutions (S.Res. 23), as follows: Resolved, That the Senate has heard with profound sorrow and deep regret the announcement of the death of Hon. ROBERT B. HOWELL, late a Senator from the State of Nebraska. Resolved, That a committee of 15 Senators be appointed by the Vice President to take order for superintending the funeral of the deceased Senator. Resolved, That the Secretary communicate these resolutions to the House of Representatives and transmit a copy thereof to the family of the deceased. The VICE PRESIDENT. The question is on agreeing to Lhe resolutions submitted by the Senator from Nebraska. The resolutions were unanimously agreed to. Under the second resolution the Vice President appointed the Senator from Nebraska [Mr. NoRRIS], the senior Senator from Iowa [Mr. DICKINSON], the junior Senator from North Dakota [Mr. NYE], the junior Senator from Michigan [Mr. VANDENBERG], the senior Senator from Indiana [Mr. RoBIN­ soN], the senior Senator from California [Mr. JoHNSON], the junior Senator from Iowa [Mr. MURPHY], the senior Senator from Utah [Mr. KING], the junior Senator from South Dakota [1\.fr. BuLow], the senior Senator from Nevada [Mr. PITTMAN], the junior Senator from Florida [Mr. TRAMMELL], the senior Senator from New Jersey [Mr. KEANJ, the junior Senator from Wyoming [Mr. CAREY], the senior Senator from Wisconsin [Mr. LA FoLLETTE], and the senior Senator from :Minnesota [Mr. SHIP STEAD]. Mr. NORPJS. Mr. President, as a further mark of respect to the memory of the deceased Senator, I move that the Senate do now adjourn. The motion was unanimously agreed to; and <at 2 c'clock and 30 minutes p.m.) the Senate adjourned until Mcnd::Ly, March 13, 1933, at 12 o'clock meridian. NOMINATIONS Executive nominations received by the Senate March 11 <legislative day of Mar. 9), 1933 ASSISTANT POSTMASTERS GENERAL Joseph C. O'Mahoney, of Wyoming, to be First Assistant Postmaster General; . William W. Howes, of South Dakota, to be Second AssisL­ ant Postmaster General; Clinton B. Eilenberger, of Pennsylvania, to be Third Assistant Postmaster General; and Silliman Evans, of Texas, to be Fourth Assistant Post­ master General. AsSISTANT SECRETARY OF AGRICULTURE Rexford Guy Tugwell, of New York, to be Assistant Secre­ tary of Agriculture. ENVOY EXTRAORDINARY AND MINISTER PLENIPOTENTBRY Norman Armour, of New Jersey, lately a Foreign Service officer of class 1 and a counselor of embassy, to be Envoy Extraordinary and Minister Plenipotentiary of the United States of America to Haiti. MINISTER RESIDENT AND CONSUL GENERAL Paul Knabenshue, of Ohio, a Foreign Service officer of class 3 and a consul general, to act as minister resident and consul general of the United States of America to Iraq. · CONSUL GENERAL Avra M. Warren, of Maryland. SECRETARIES IN THE DIPLOMATIC SERVICE Harold Shantz, of New York. H. Merrell Benninghoff, of New York. Cloyce K. Huston, of Iowa. Winthrop R. Scott, of Ohio. H. Merle Cochran, of Arizona. GoVERNOR OF THE PANAMA CANAL Lt. Col. Julian L. Schley, Corps of Engineers, United States Army, for appointment as Governor of the Panama Canal, provided for by the Panama Canal Act, approved August 24, 1912. VICE GOVERNOR OF THE PHILIPPINE IsLANDS John H. Holliday, of Missouri, to be Vice Governor of the Philippine Islands, to which office he was originally ap­ pointed ad interim, on August 13, 1932, vice George C. Butte, resigned, and was reappointed ad interim on March 7, 1933.