Congressional Record 1932
Bound Edition
William Jackson
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June 10, 1932 Vol. 75, Part 11 — 72nd Congress - 1st Session
CONGRESSIONAL RECORD - BOUND EDITION
1. June 10, 1932
Volume and Section: Vol. 75, Part 11 - House of Representatives
Pages: 12564-12653

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Transcript
The CHAIRMAN. The time of the gentleman from Massachusetts has again expired.
Mr. McFADDEN. Mr. Chairman, how much time have I
remaining?
The CHAIRMAN. Twenty-five minutes.
Mr. McFADDEN. Mr. Chairman, at the present session
of Congress we have been dealing with emergency situations. We have been dealing with the effect of things
rather than with the cause of things. In this particular
discussion I shall deal with some of the causes that lead
up to these proposals. There are underlying principles
which are responsible for conditions such as we have at
the present time and I shall deal with one of these in particular which is tremendously important in the consideration that you are now giving to this bill.
Mr. Chairman, we have in this country one of the
most corrupt institutions the world has ever known. I
refer to the Federal Reserve Board and the Federal reserve
banks. The Federal Reserve Board, a Government board,
has cheated the Government of the United States and the
people of the United States out of enough money to pay the
national debt. The depredations· and the iniquities of the
Federal Reserve Board and the Federal reserve banks acting
together have cost this country enough money to pay the
national debt several times over. This evil institution has
impoverished and ruined the people of the United States;
has bankrupted itself, and has practically bankrupted our
Government. It has done this through the defects of the
law under which it operates, through the maladministration
of that law by the Federal Reserve Board, and through the
corrupt practices of the moneyed vultures who control it.
Some people think the Federal reserve banks are United
States Government institutions. They are not Government
institutions. They are private credit monopolies which prey
upon the people of the United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory
money lenders. In that dark crew of financial pirates there
are thdse who would cut a man's throat to get a dollar out
of his pocket; there are those who send money into States
to buy votes to control our legislation; and there are those
who maintain an international propaganda for the purpose
of deceiving us and of wheedling us into the granting of
new concessions which will permit them to cover up their
past misdeeds and set again in motion their gigantic train
of crime.
Those 12 private credit monopolies were deceitfully and.
disloyally foisted upon this country by bankers who came
here from Europe and who repaid us for our hospitality by
undermining our American institutions. Those bankers
took money out of this country to finance Japan in a war
against Russia. They created a reign of terror in Russia with
our money in order to help that war along. They instigated
the separate peace between Germany and Russia and thus
drove a wedge between the allies in the World War. They
financed Trotsky's mass meetings of discontent and rebellion in New York. They paid Trotsky's passage from New
York to Russia so that he might assist in the destruction
of the Russian Empire. They fomented and instigated the
Russian revolution and they placed a large fund of American dollars at Trotsky's disposal in one of their branch
banks in Sweden so that through him Russian homes might
be thoroughly broken up and Russian children flung far
and wide from their natural protectors. They have since
begun the breaking up of American homes and the dispersal
of American children.
It has been said that President Wilson was deceived by the
attentions of these bankers and by the philanthropic poses
they assumed. It has been said that when he discovered the
manner in which he had been misled by Colonel House, he
turned against that busybody, that "holy monk" of the
financial empire, and showed him the door. He had the
grace to do that, and in my opinion he deserves great credit
for it.
President Wilson died a victim of deception. When he
came to the Presidency, he had certain qualities of mind
and heart which entitled him to a high place in the councils
of this Nation; but there was one thing he was not and
which he never aspired to be; he was not a banker. He
said that he knew very little about banking. It was, therefore, on the advice of others that the iniquitous Federal
reserve act, the death warrant of American liberty, became
law in his administration.
Mr. Chairman, there should be no partisanship in matters
concerning the banking and currency affairs of this country,.
and I do not speak with any.
In 1912 the National Monetary Association, under the
chairmanship of the late Senator Nelson W. Aldrich, made
a report and presented a vicious bill called the National
Reserve Association bill. This bill is usually spoken of as the
Aldrich bill. Senator Aldrich did not write the Aldrich bill.
He was the tool, but not the accomplice, of the Europeanborn bankers who for nearly 20 years bad been scheming to
set up a central bank in this country and who in 1912 had
spent and were continuing to spend vast sums of money to
accomplish their purpose.
The Aldrich bill was condemned in the platform upon
which Theodore Roosevelt was nominated in the year 1912,
and in that same year, when Woodrow Wilson was nominated, the Democratic platform, as adopted at the Baltimore
convention, expressly stated: "We are opposed to the Aldrich
plan or a central bank." This was plain' language. The
men who ruled the Democratic Party then promised the people that if they were returned to power there would be no
central bank established here while they held the reins of
government. Thirteen months later that promise was
broken, and the Wilson administration, under the tutelage
of those sinister Wall Street figures who stood behind Colonel House, established here in our free country the wormeaten monarchical institution of the "king's bank" to control us from the top downward, and to shackle us from the cradle to the grave. The Federal reserve act destroyed our
old and characteristic way of doing business; it discrimi- -nated against our 1-name commercial paper, the finest in
the world; it set up the antiquated 2-name paper, which is
the present curse of this country, and which has wrecked
every country which has ever given it scope; it fastened
down upon this country the very tyranny from which the
framers of the Constitution sought to save us.
One of the greatest battles for the preservation of this
Republic was fought out here in Jackson's day, when the
Second Bank of the United States, which was founded upon
the same false principles as those which are exemplified in
the Federal reserve act, was hurled out of existence. After
the downfall of the Second Bank of the United States in
1837, the country was warned against the dangers that
might ensue if the predatory interests, after being cast out,
should come back in disguise and unite themselves to the
Executive, and through him acquire control of the Govern·
ment. That is what the predatory interests did when they
came back in the livery of hypocrisy and under false pretenses obtained the passage of the Federal reserve act.
The danger that the country was warned against came
upon us and is shown in the long train of horrors attendant
upon the affairs of the traitorous and dishonest Federal
Reserve Board and the Federal reserve ba:P..ks. Look
around you when you leave this chamber and you will see
evidences of it on all sides. This is an era of economic
misery and for the conditions that caused that misery, the
Federal Reserve Boatd and the Federal reserve banks are
fully liable. This is an era of financed crime and in the
financing of crime, the Federal Reserve Board does not play
the part of a disinterested spectator.
It has been said that the draughtsman who was employed
to write the text of the Federal reserve bill U.sed the text
of the Aldrich bill for his purpose. It has been said that
the language of the Aldrich bill was used because the
Aldrich bill had been drawn up by expert lawyers and
seemed to be appropriate. It was indeed drawn up by
lawyers. The Aldrich bill was created by acceptance bankers of European origin in New York City. It was a copy
and in general a translation of the statutes of the Reichsbank and other European central banks.
Half a million dollars was spent on one part of the propaganda organized by those same European bankers for the
purpose of misleading public opinion in regard to it, and
for the purpose of giving Congress the impression that
there was an overwhelming popular demand for that kind
of banking legislation and the kind of currency that goes
with it, namely, an asset currency based on human debts
and obligations instead of an honest currency based on gold
and silver values. Dr. H. Parker Willis had been employed
by the Wall Street bankers and propagandists and when the
Aldrich measure came to naught and he obtained employment from CARTER GLAss to assist in drawing a banking bill
for the Wilson administration, he appropriated the text of
the Aldrich bill for his purpose. There is no secret about
it. The text of the Federal reserve act was tainted from
the beginning.
Not all of the Democratic Members of the Sixty-third
Congress voted for this great deception. Some of them
remembered the teachings of Jefferson; and, through the
years, there have been no criticisms of the Federal Reserve
Board and the Federal reserve banks so honest, so outspoken, and so unsparing as those which have been voiced
here by Democrats. Again, although a number of Republicans voted for the Federal reserve act, the wisest and most
conservative members of the Republican Party would have
nothing to do with it and voted against it. A few days
before the bill came to a vote, Senator Henry cabot Lodge,
of Massachusetts, wrote to Senator John W. Weeks as follows:
NEW YoRK CITY, December 17, 1913.
MY DEAR SxNATOR WEEKs: • • • Throughout my public life
I have supported an measures designed to take the Government
out of the ban.ldlllg business • • •. This bill puts the Government Into the banking business as never before tn our history and makes, as I underStand 1\, an notes Government notes
when they should be bank notes.
The powers vested tn the Federal Reserve Board seem to me highly dangerous, especially where there is political control of the
board. I should be s·orry to hold stock in a bank subject to such
domination. The blll as !t stands seems to me to open the way
to a vast inflation of the currency. There is no necessity of
dwelling upon this point after the remarkable and most powerful
argument of the senior Senator from New York. I can be con- tent here to follow the example of the English candidate for
Parliament who thought it enough "to say ditto to Mr. Burke."
I wm merely add that I do not like to think that any law can be passed which will make tt possible to submerge the gold
standard in a flood of irredeemable paper currency.
I had hoped to support this bill, but I can not vote for it as It stands, because it seems to me to contain features and to rest
upon principles in the highest degree menacing to our prosperity,
to stabiltty in business, and to the general welfare of the people
of the United States.
Very sincerely yours, HENRY CABOT LoDGE.
In the 18 years which have passed since Senator Lodge
wrote that letter of warning all of his predictions have come
true. The Government is in the banking business as never
before. Against its will it has been made the backer of
horsethieves and card sharps, bootleggers, smugglers, speculators, and swindlers in all parts of the world. Through the
Federal Reserve Board and the Federal reserve banks the
riffraff of every country is operating on the public credit of
the United States Government. Meanwhile, and on account
of it, we ourselves are in the midst of the greatest depression we have ever known. Thus the menace to our prosperity, so feared by Senator Lodge, has indeed struck home.
From the Atlantic to the Pacific our country has been :ravaged and laid waste by the evil practices of the Federal
Reserve Board and the Federal reserve banks and the interests which control them: At no time in our history has the
general welfare of the people of the United States been at
a lower level or the mind of the people so filled with
despair.
Recently in one of our states 60,000 dwelling houses and
farms were brought under the hammer in a single day. According to the Rev. Father Charles E. Coughlin, who has
lately testified before a committee of this House, 71,000
houses and farms in Oakland County, Mich., have been sold
and their erstwhile owners dispossessed. Similar occurrences have probably taken place in every county in the
United States. The people· who have thus been driven out
are the wastage of the Federal reserve act. They are the
victims of the dishonest and unscrupulous Federal Reserve
Board and the Federal reserve banks. Their children are
the new slaves of the auction block in the revival here of the
institution of human slavery.
In 1913, before the Senate Banking and Currency Committee, MJ.·. Alexander Lassen made the following statement:
But the whole scheme of a Feder~l re~erve ban.f with its com- mercial-paper basis is an impractical, cumbersome machinery, is
simply a cover, to find a way to secure the privilege of issuing money and to evade payment of as much tax upon circulation as possible, and then control the issue and maintain, instead of
reduce, interest rates. It is a system that, if inaugurated, will
prove to the advantage of the few and the detriment of the people
of the United States. It will mean continued shortage of actual
money and further extension of credits; for when there is a lack
of real money people have to borrow credit to their cost.
A few days before the Federal reserve act was passed Senator Elihu Root denounced the Federal reserve bill as an
outrage on our liberties and made the following prediction:
Long bef ore we wake up from our dreams of prosperity through
an inflated currency, our gold, which alone could have kept us from catastrophe, will have vanished and no rate of interest will
tempt it to ret urn.
If ever a prophecy came true, that one did. It was impossible, however, far those luminous and instructed thinkers to
control the cow-se of events. On December 23, 1913, the
Federal reserve bill became law, and that night Colonel
House wrote to his hidden master in Wall Street as follows:
I want to saj a word of appreciation to you· for the silent but no doubt effective work you have done in the interest of currency legislation and t o congratulate you that the measure has finally
been enacted into law. We all know that an entirely perfect bill,
satisfactory to everybody, would h ave been an impossibility, and
I feel quite certain fair men will admit that unless the President
had stood as firm as he did we should likely have had no legislation at all. The bill is a good one in many respects; anyhow good enough to start with and to let experience teach us in what
direction it needs perfection, which in due time we shall then get.
In any event you have personally good reason to feel gratified
with what has been accomplished.
The words " unless the President had stood as firm as he
did we should likely have had no legislation at all," were a
gentle reminder that it was Colonel House himself, the
"holy monk," who had kept the President firm.
The foregoing letter affords striking evidence of the manner in which the predatory interests then sought to control
the Government of the United States by surrounding the
Executive with the personality and the influence of a financial Judas. Left to itself and to the conduct of its own legislative functions without pressure from the Executive, the
Congress would not have passed the Federal reserve act.
According to Colonel House, and since this was his report to
his master, we may believe it to be true, the Federal reserve
act was passed because Wilson stood firm; in other words
because Wilson was under the guidance and control of the
most ferocious usurers in New York through their hireling,
House. The Federal reserve act became law the day before
Christmas Eve in the year 1913, and shortly afterwards the
German international bankers, Kuhn, Loeb & Co., sent one
of their partners here to run it.
In 1913, when the Federal reserve bill was submitted to
the Democratic caucus, there was a discussion in regard to
the form the proposed paper currency should take.
The proponents of the Federal reserve act, in their determination to create a new kind of paper money, had not
needed to go outside of the Aldrich bill for a model. By the
terms of the Aldrich bill, bank notes were to be issued by the
National Reserve Association and were to be secured partly
by gold or lawful money and partly by circulating evidences
of debt. The first draft of the Federal reserve bill presented
the same general plan, that is, for bank notes as opposed to
Government notes, but with certain differences of regulation.
When the provision for the issuance of Federal reserve
notes was placed before President Wilson he approved of it,
but other Democrats were more mindful of Democratic principles and a great protest greeted the plan. Foremost
amongst those who denounced it was William Jennings
Bryan the Secretary of State. Bryan wished to have the Feder~l reserve notes issued as Government obligations.
President Wilson had an interview with him and found him
adamant. At the conclusion of the interview Bryan left
with the understanding that he would resign if the notes
were made bank notes. The President then sent for his Secretary and explained th~ matter to him. Mr. Tumulty went
to see Bryan and Bryan took from his library shelves a book
containing all the Democratic platforms and read extracts
from them bearing on the matter of the public currency.
Returning to the President, Mr. Tumulty told him what. had
happened and ventured the opinion that Mr. Bryan was
right and that Mr. Wilson was wrong. The President then
asked Mr. Tumulty to show him where the Democratic Party
in its national platforms had ever taken the view indicates!
by Bryan. Mr. Tumulty gave him the book, which he had
brought from Bryan's house, and the President read very
carefully plank after plank on the currency. He then said,
"I am convinced there is a great deal in what Mr. Bryan
says," an·d thereupon it was arranged that Mr. Tumulty
should see the proponents of the Federal reserve bill in an
effort to bring about an adjustment of the matter.
The remainder of this story may be told in the words of
Senator GLASs. Concerning Bryan's opposition to the plan
of allowing the proposed Federal reserve notes to take the
form of bank notes and the manner in which President Wilson and the proponents of the Federal reserve bill yielded
to Bryan in return for his support of the measure, Senator
GLASs makes the following statement:
The only other feature of the currency bill around which a conflict raged at this time was the note-issue provision. Long before I knew it, the President was desperately worried over it.
His economic good s..:nse told him the notes should be issued by
the banks and not by the Government; but some of his advisers
told him Mr. Bryan could not be induced to give his support to
any bill that did not provide for a. "Government note." There was in the Senate and House a large :Bryan following which, united with a n!.turally adversary party vote, could prevent legislation. Certain averconfident gentlemen proffered their services 1n
the task of" managing Bryan." They did not budge h1m.. • • •
When a decision could no longer be postponed the President sum- moned me to the White House to say he wanted Federal reserve notes to " be obligations of the United Stat es." I was for an instant speechless. With all the earnestness of _my being I remon- strated, pointing out the unscientific nature of such a thing, as well as the evident inconsistency of it.
" There is not, in truth, any Government obligation here, Mr.
President," I exclaimed. "It would be a pretense on its face.
Was there ever a Government note based primarily on the property of banking institutions? Was there ever a Government issue
not one dollar of which could be put out except by demand of a bJ.nk? The suggested Government obligation is so remote it could never be discerned," I concluded, out of breath.
"Exactly so, GLAss," earnestly said the President. "Every word
you say is true; the Government liability is a mere thought. And
so, if we can hold to the substance of the thing and give the
other fellow the shadow, why not do it, 1f thereby we may save our bill?"
Shadow and substance! One ·can see from this how little
President ·Wilson knew about banking. Unknowingly, he
gave the substance to the international banker and the
shadow to the common man. Thus was Bryan circumvented in his efforts to uphold the Democratic doctrine of
the rights of the people. Thus the" unscientific blur" upon
the bill was perpetrated. The "unscientific blur," however, was not the fact that the United States Government,
by the terms of Bryan's edict, was obliged to assume as an
obligation whatever currency was issued. Mr. Bryan was
right when he insisted that the United States should preserve its sovereignty over the public currency. The "unscientific blur " was the nature of the currency itself, a nature
which makes it unfit to be assumed as an obligation of the
United States Government. It is the worst currency and
the most dangerouS this country has ever known. When the
proponents of the act saw that Democratic doctrine would
not permit them to let the proposed banks issue the new currency as bank notes, they should have stopped at that.
They should not have foisted that kind of currency, namely,
an asset currency, on the United States Government. They
should not have made the Government liable on the private
debts of individuals and corporations and, least of all, on
the private debts of foreigners.
The Federal reserve note is essentially unsound.
As Kemmerer says:
The Federal reserve notes, therefore, in form have some of the
qualities of Government paper money, but, in substance, are almost a pure asset currency possessing a Government guaranty
against which contingency the Government has made no provision
whatever.
Hon. E. J. Hill, a former Member' of the House, said, and
truly: .
• • • They are obligations of the Government for which
the United States has received nothing and for the payment of
which at any time it assumes the responsibility looking to the
Federal reserve bank to recoup itself.
If the United States Government is to redeem the Federal
reserve not.es when the general public finds out what it costs
to deliver this flood of paper money to the 12 Federal reserve
banks, and if the Government has made no provision for
redeeming them, the first element of their unsoundness is
not far to seek.
Before the Senate Banking and Currency Committee,
while the Federal reserve bill was under discussion, Mr.
Crozier, of Cincinnati, said:
In other words, the imperial power of elasticity of the public
currency is wielded exclusively by these central corporations owned
by the banks. This is a life and death power over all local banks
and all business. It can be used to create or destroy prosperity,
to ward otf or cause stringencies and panics. By making money
artificially scarce interest rates throughout the country can be
arbitrarily raised and the bank tax on all business and cost of
living increased for the profit of the banks owning these regional
central banks, and without the slightest benefit to the people.
These 12 corporations together cover the whole country and mo- nopolize and- use for private gain every dollar of the public cur- rency and all public revenues of the United States. Not a dollar can be put into circulation among the people by their Government
without the consent of and on terms fixed by these 12 private
money trusts.
In defiance of this and all other warnings, the proponents
of the Federal reserve act created the 12 private credit corporations and gave them an absolute monopoly of the currency of the United States, not of Federal reserve notes
alone, but of all the currency, the Federal reserve act pr:>-
viding ways by means of which the gold and general currency in the hands of the American people could be obtained
by the Federal reserve banks in exchange for Federal reserve
notes, which are not money but merely promises to pay
money. Since the evil day when this was done the initial
monopoly has been extended by vicious amendments to the
Federal reserve act and by the unlawful and treasonable
practices of the Federal Reserve Board and the Federal
reserve banks.
Mr. Chairman, when a· Chinese merchant sells human
hair to a Paris wigmaker and bills him in dollars, the Federal reserve banks can buy his bill against the wigmaker and
then use that bill as collateral for Federal reserve notes.
The United States Government thus pays the Chinese merchant the debt of the wigmaker and gets nothing in return
except a shady title to the Chinese hair.
Mr. Chairman, if a Scotch distiller wishes to send a cargo
of Scotch whisky to the United States, he can draw his bill
against the purchasing bootlegger in dollars; and after the
bootlegger has accepted it by writing his name across the
face of it, the Scotch distiller can send that bill to the
nefarious open discount market in New York City, where
the Federal Reserve Board and the Federal reserve banks
will buy it and use it as collateral for a new issue of Federal
reserve notes. Thus the Government of the United States
pays the Scotch distiller for the wliisky before it is shipped;
and if it is lost on the way, or if the Coast Guard seizes it
and destroys it, the Federal reserve banks simply write off
the loss and the Government never recovers the money that
was paid to the Scotch distiller. While we are attempting
to enforce prohibition here, the Federal Reserve Board and
the Federal reserve banks are financing the distillery business in Europe and are paying bootleggers' bills with the
public credit of the United States Government.
Mr. Chairman, if a German brewer ships beer to this
country or anywhere else in the world and draws his bill for
it iii dollars, the Federal reserve ·banks will buy that bill and
use it as collateral for Federal reserve notes. Thus, they
compel our Government to pay the German brewer for his
beer. Why should the Federal Reserve Board and the Federal reserve banks be permitted to finance the brewing industry of Germany, either in this way or as they do by compelling small and fearful United States banks to take stock
in the Isenbeck brewery and in the German bank for brewing industries?
Mr. Chairman, if Dynamit Nobel of Germany wishes to
sell dynamite to Japan to use in Manchuria or elsewhere,
it can draw its bill against its Japanese customers 'in dollars and send that bill to the nefarious open discount market in New York City, where the Federal Reserve Board and
the Federal reserve banks will buy it and use it as collateral
for a new issue of Federal reserve notes, while at the same
time the Federal Reserve Board will be helping Dynamit
Nobel by stutfing its stock into the United States banking
system. Why should we send our representatives to the
disarmament conference at Geneva while the Federal Reserve Board and the Federal reserve banks are making our
Government pay japanese debts to German munition
makers?
Mr. Chairman, if a bean grower of Chile wishes to raise
a crop of beans and sell them to a Japanese customer, he
can draw a bill against his prospective Japanese customer
in dollars and have it purchased by the Federal Reserve
Board and the Federal reserve banks and get the money
out of this country at the expense of the American public
before he has even planted the beans in the ground.
Mr. Chairman, if a German in Germany wishes to export
goods to South Am~rica or anywhere else, he can draw his
bill against his customer and send it to the United States and get the money out of this country before he ships or
even manufactures the goods.
Mr. Chairman, why should the currency of the United
States be issued on the strength of Chinese human hair?
Why should it be issued on the trade whims of a wigmaker?
Why should it be issued on the strength of German beer?
Why should it be issued on a crop of unplanted beans to be
grown in Chile for Japanese consumption? Why should the
Government of the United States be compelled to issue
many billions of dolla:rs every year to pay the debts of one
foreigner to another foreigner? Was it for this that our
national-bank depositors had their money taken out of our
banks and shipped abroad? Was it for this they had to
lose it? Why should the public credit of the United States
Government and likewise money belonging to our nationalbank depositors be used to support foreign brewers, narcotic
drug vendors, whiskey distillers, wigmakers, human-hair
merchants, Chilean bean growers, and the like? Why should
our national-bank depositors and our Government be forced
to finance the munition factories of Germany and Soviet
Russia?
Mr. Chairman, if a German, in Germany, wishes to sell
wheelbarrows to another German, he can draw a bill in
dollars and get the money out of the Federa~ reseTve banks
before an American farmer could explain his request for a
loan to move his crop to market. In Germany, when credit
instruments are being given, the creditors say, "See you, it
must be of a kind that I can cash at the reserve." Other
foreigners feel the same way. The reserve to which these
gentry refer is our reserve, which, as you know, is entirely
made . up of money belonging to American bank depositors. ~ think foreigners should cash their own trade paper and
not send it over here to bankers who use it to fish cash out
of the pockets of the American people.
Mr. Chairman, there is nothing like the Federal reserve
pool of confiscated bank deposits in the world. It is a pubUc
trough of American wealth in which foreigners claim rights
equal to or greater than those of Americans. The Federal
reserve banks are the agents of the foreign central banks.
They use our bank depositors' money for the benefit of their
foreign principals. They barter the public credit' of the
United States Government and hire it out to foreigners at a
profit to themselves.
All this is done at the expense of the United States Government, and at a sickening loss to the American people.
Only our great wealth enabled us to stand the drain of it as
long as we did. ,
l believe that the nations of the world would have settled
down after the World War more peacefully if we had not
had this standing temptation here-this pool of ,our bank
depositors' money given to private interests and used by
them in connection with illimitable drafts upon the public
credit of the United States Government. The Federal ,Reserve Board invited the world to come in and to carry away
cash, credit, goods, and everything else of value that was
movable. Values amounting to many billions of dollars have
been taken out of this country by the Federal Reserve Board
and the Federal reserve banks for the benefit of their foreign principals. The United States has been ransacked and
pillaged. Our structures have been gutted and only the
walls are left standing. While this crime was being perpetrated everything the world could rake up to sell us was
brought in here at our own expense by the Federal Reserve
Board and the Federal reserve banks until our markets were
swamped with unneeded and unwanted imported goods
priced far above their value and thus made to equal the
dollar volume of our honest exports and to kill or reduce
our favorable balance of trade. As agents of the foreign
central banks, the Federal Reserve Board and the Federal
reserve banks try by every means within their power to reduce our favorable balance of trade. They act for their
foreign principals and they accept fees from foreigners for
acting against the best interests of the United States. Naturally there has been great competition among foreigners
f9r the favors of the Federal Reserve Board.
What we need to do is to send the reserves of our national
banks home to the people who earned and produced them
and who still own them and to the banks which were compelled to surrender them to predatory interests. We need
to destroy the Federal reserve pool, wherein our nationalban..'!{ reserves are impounded for the benefit of foreigners.
We need to make it very difficult for outlanders to draw
money away from us. We need to save America for
Americans.
Mr. Chairman, when you hold a $10 Federal reserve note
in your hand you are holding a piece of paper which sooner
or later is going to cost the United States Government $10
in gold, unless the Government is obliged to give up the
gold standard. It is protected by a reserve of 40 per cent,
or $4 in gold. It is based on Limburger cheese, reputed to
be in a foreign warehouse; or on cans purporting to contain
peas but which may contain no peas but salt water instead;
or on horse meat; illicit drugs; bootleggers' fancies; rags
and bones from Soviet Russia of which the United States
imported over a million dollars' worth last year; on wine,
whisky, natural gas, on goat or dog fur, garlic on the
string, or Bombay ducks. If you like to have paper money
which is secured by such commodities, you have it in the
Federal reserve note. If you desire to obtain the thing of
value upon which this paper currency is based-that is, the
Limburger cheese, the whisky, the illicit drugs, or any of
the other staples-you will have a very hard time finding
them. Many of these worshipful commodities are in foreign countries. Are you going to Germany to inspect her
warehouses to see if the specified things of value are there?
I think not. And what is more, I do not think you would
find them if you did go.
Immense sums belonging to our national-bank depositors
have been given to Germany on no collateral security whatever. The Federal Reserve Board and the Federal reserve
banks have issued United States currency on mere finance
drafts drawn by Germans. Billions upon billions of our
money has been pumped into Germany and money is still
being pumped into Germany by the Federal Reserve Board
and the Federal reserve banks. Her worthless paper is still
being negotiated here and renewed here on the public credit
of the United States Government and at the expense of the
American people. On April 27, 1932, the Federal reserve
outfit sent $750,000, belonging to American bank depositors,
in gold to Germany. A week later, another $300,000 in gold
was shipped to Germany in the same way. About the middle
of May $12,000,000 in gold was shipped to Germany by the
Federal Reserve Board and the Federal reserve banks. Almost every week there is a shipment of gold to Germany.
These shipments are not made for profit on exchange since
German marks are below parity against the dollar.
Mr. Chairman, I believe that the national-bank depositors
of the United States are entitled to know what the Federal
Reserve Board and the Federal reserve banks are doing with
their money. There are millions of national-bank depositors
in this country who do not know that a percentage of every
dollar they deposit in a member bank of the Federal re .. serve system goes automatically to the American agents of
foreign banks and that all of their deposits can be paid away
to foreigners without their knpwledge or consent by the
crooked machinery of the Federal reserve act and the
questionable practices of the Federal Reserve Board and the
Federal reserve banks. Mr. Chairman, the American people
Should be told the truth by their servants in office.
In 1930 we had over half a billion dollars outstanding
daily to finance foreign goods stored in or shipped between
foreign countries. In its yearly total, this item amounts to
several billion dollars. What goods are those upon which
the Federal reserve banks yearly pledge several billion dollars of the public credit of the United States? What goods
are those which are hidden in European and Asiatic storehouses and which have never been seen by any officer of this
Government, but which are being financed on the public
credit of the United States Government? What goods are
those upon which the United States Government is being
obliged by the Federal reserve banks to issue Federal reserve
notes to the extent of several billion dollars a year?
The Federal Reserve Board and the Federal reserve banks
bave been international bankers from the beginning, with
the United States Government as their enforced banker and
supplier of currency. But it is none the less extraordinary
to see those 12 private credit monopolies buying the debts of
foreigners against foreigners in all parts of the world and
asking the Government of the United States for new issues
of Federal reserve notes in exchange for them.
I see no reason why the American taxpayers should be
hewers of wood and drawers of water for the European. and
Asiatic customers of the Federal reserve banks. I see no
reason why a worthless acceptance drawn by a foreign
swindler as a means of getting gold out of this country
should receive the lowest and choicest rate from the Federal
Reserve Board and be treated as better security than the
note of an American farmer living on American land.
The magnitude of the acceptance 1·acket, as it has been
developed by the Federal reserve banks, their foreign correspondents, and the predatory European-born bankers who
set up the Federal reserve institution here and taught our
own brand of pirates how to loot the people-! say the magnitude of this racket is estimated to be in the neighborhood
of $9,000,000,000 a year. In the past 10 years it is said to
. have amounted to $90,000,000,000. In my opinion, it has
amounted to several times as much. Coupled with this you
have, to the extent of billions of dollars, the gambling in
United states securities, which takes place in the same open
discount market-a gamble upon which the Federal Reserve
Board is now spending $100,000,000 a week.
Federal reserve notes are taken from the United States
Government in unlimited quantities. Is it strange that the
burden of supplying these immense sums of money to the
gambling fraternity has at last proved too heavY for the
American people to endure? Would it not be a national
calamity if the Federal Reserve Board and the Federal reserve banks should again bind this burden down on the
backs of the American people and, by means of the long
rawhide whips of the credit masters, compel them to enter
upon another 17 years of slavery? They are trying to do
that now. They are taking $100,000,000 of the public credit
of the United States Government every week in addition to
all their other seizures, and they are spending that money
in the nefarious open market in New York City in a desperate gamble to reestablish their graft as a going concern.
They are putting the United States Government in debt
to the extent of $100,000,000 a week, and with this money
they are buying up our Government securities for themselves
and their foreign principals. Our people are disgusted with
the experiments of the Federal Reserve Board. The Federal
Reserve Board is not producing a loaf of bread, a yard of
cloth, a bushel of com, or a pile of cordwood by its cl1eckkiting operations in the money market.
A fortnight or so ago great aid and comfort was given
to Japan by the firm of A. Gerli & Sons, of New York, an
importing firm, which bought $16,000,000 worth of raw silk
from the Japanese Government. Federal reserve notes will
be issued to pay that amount to the Japanese Government,
and these notes will be secured by money belonging to our
national-bank depositors.
Why should United States currency be issued on this debt?
Why should United States currency be issued to pay the debt
of Gerli & Sons to the Japanese Government? The Federal
Reserve Board and the Federal reserve banks think more
of the silkworms of Japan than they do of American citizens. We do not need $16,000,000 worth of silk in this
country at the present time, not even to · furnish work to
dyers and finishers. We need to wear home-grown and
American-made clothes and to use our own money for our
own goods and staples. We could spend $16,000,000 in the
United States of America on American children and that
would be a better investment for us than Japanese silk purchased on the public credit of the United States Government.
Mr. Speaker, on the 13th of January of this year I addressed the House on the subject of the Reconstruction
Finance Corporation. In the course of my remarks I made
the following statement:
In 1928 the member banks of the Federal reserve system borrowed $60,598,690,000 from the Federal reserve banks on their
15-day promissory notes. Think of it! Sixty billion. dollars payable upon demand 1n gold 1n the course of one single year. The
actual payment of such obligations calls for six times as much
monetary gold as there is in the entire world. Such transactions
represent a grant in the course of one single year of about
$7,000,000 to every member bank of the Federal reserve system.
Is it any wonder that there is a depression 1n this country? Is it
any wonder that American labor, which ultimately pays the cost
of all the banking operations of this country, has at last proved
unequal to the task of supplying this huge total of cash and
credit for the benefit of stock-market manipulators and foreign swindlers?
Mr. Chairman, some of my colleagues have asked for more
specific information concerning this stupendous graft, this
frightful burden which has been placed on the wage earners
and taxpayers of the United States for the benefit of the
Federal Reserve Board and the Federal reserve banks. They
were surprised to learn that member banks of the Federal
reserve system had received the enormous sum of $60,598,-
690,000 from the Federal Reserve Board and the Federal reserve banks on their promissory notes in the course of one
single year, namely, 1928. Another Member of this House,
Mr. BEEDY, the honorable gentleman from Maine, has questioned the accuracy of my statement and has informed me
that the Federal Reserve Board denies absolutely that these
figures are correct. This Member has said to me that the
thing is unthinkable, that it can not be, that it is beyond
all reason to think that the Federal Reserve Board and the
Federal reserve banks should have so subsidized and endowed their favorite banks of the Federal reserve system.
This Member is horrified at the thought of a graft so great,
a bounty so detrimental to the public welfare as sixty and
a half billion dollars a year and more shoveled out to favored banks of the Federal reserve system.
I sympathize with Mr. BEEDY. I would spare him pain if
I could, but the facts remain as I have stated them. In
1928, the Federal Reserve Board and the Federal reserve
banks presented the staggering amount of $60,598,690,000
to their member banks at the expense of the wage earners
and taxpayers of the United States. In 1929, the year of
the stock-market crash, the Federal Reserve Board and the
Federal reserve banks advanced :fifty-eight billions to member banks.
In 1930, while the speculating banks were getting out of
the stock market at the expense of the general public, the
Federal Reserve Board and the Federal reserve banks advanced them $13,022,782,000. This shows that when the
banks were gambling on the publie credit of the United
States Government as represented by Federal reserve currency, they were subsidized to any amount they required by
the Federal Reserve Board and the Federal reserve banks.
When the swindle began to fail, the banks knew it in advance and withdrew from the market. They got out with
whole skins and left the people of the United States to pay
the piper.
On November 2, 1931, I addressed a letter to the Federal
Reserve Board asking for the aggregate total o1 member
bank borrowings in the years 1928, 1929, 1930. In due
course, I received a reply from the Federal Reserve Board,
dated November 9, 1931, the pertinent part of which reads
as follows:
MY DEAR CONGRESSMAN: In reply to your letter Of November 2,
you are advised that the aggregate amount of 15-day promissory
notes of member banks during each of the past three calendar
years has been as follows:
1928-------------------------------------- $60,598,690,000
1929-------------------------------------- 58, 046, 697, 000
1930-------------------------------------- 13,022,782,000
• • • • • • •
Very truly yours, CHESTER MoRRILL, Secretary.
This will show the gentleman from Maine the accuracy of
my statement. As for the denial of these facts made to him by .the Federal Reserve Board, I can only say that it must. have been prompted by fright, since hanging is too good
for a Government board which permitted such a misuse of
Government funds and credit.
My friend from Kansas, Mr. McGuGm, has stated that he
thought the Federal Reserve Board and the Federal reserve
banks lent money by rediscounting. So they do, but they
lend comparatively little that way. The real rediscounting
that they do has been called a mere penny in the slot business. It is too slow for genuine high flyers. They discourage it. They prefer to subsidize their favorite banks by
making these $60,000,000,000 advances, and they prefer to acquire acceptances in the notorious open discount market in
New York, where they can use them to control the prices of
stocks and bonds on the exchanges. For every dollar they
advanced on rediscounts in 1928 they lent $33 to their favorite banks for gambling purposes. In other words, their
rediscounts in 1928 amounted to $1,814,271,000, while their
loans to member banks amounted to $60,598,690,000. As for
their open-market operations, these are on a stupendous
scale and no tax is paid on the acceptances they handle;
and their foreign principals, for whom they do a business
of several billion dollars every year, pay no income tax on
their profits to the United States Government.
This is the John Law swindle over again. The theft of
Teapot Dome was trifling compared to it. What· king ever
robbed his subjects to such an extent as the Federal Reserve Board and the Federal reserve banks have robbed us?
Is it any wonder that there have lately been 90 cases of
starvation in one of the New York hospitals? Is it any
wonder that the children of this country are being dispersed and abandoned?
The Government and the people of the United States have
been swindled by swindlers de luxe to whom the acquisition
of American gold or a parcel of Federal reser.ve notes presented no more difficulty than the drawing up of a worthless acceptance in a country not subject to the laws of the
United States, by sharpers not subject to the jurisdiction
of the United States courts, sharpers with a strong banking
" fence " on this side of the water-a " fence " acting as a
receiver of the worthless paper coming from abroad, indorsing it and getting the currency out of the Federal
reserve banks for it as quickly as possible, exchanging that
currency for gold, and in turn transmitting the gold to its
foreign confederates.
Such were the exploits of Ivar Kreuger, Mr. Hoover's
friend, and his hidden Wall Street backers. Every dollar
of the billions Kreuger and his gang drew out of this country on acceptances was drawn from the Government and
the people of the United States through the Federal Reserve
Board and the Federal reserve banks. The credit of the
United States Government was peddled to him by the Federal Reserve Board and the Federal reserve banks for their
own Pt:ivate gain. That is what the Federal Reserve Board
and the Federal reserve banks have been doing for many
years. They have been peddling the credit of this Government and the signature of this Government to the swindlers
and speculators of all nations. That is what happens when
a country forsakes its Constitution and gives its sovereignty
over the public currency to private interests. Give them the
flag and they will sell it.
The nature of Kreuger's organized swindle and the bankrupt condition of Kreuger's combine was known here last
June when Hoover sought to exempt Kreuger's loan to
Germany of one hundred twenty-five millions from the operation of the Hoover moratorium. The bankrupt condition of
Kreuger's swindle was known here last summer when $30,-
000,000 was taken from American taxpayers by certain bankers in New York for the ostensible purpose of permitting
Kreuger to make a loan to Colombia. Colombia never saw
that money. The nature of Kreuger's swindle and the bankrupt condition of Kreuger was known here in January when
he visited his friend. Mr. Hoover, at the White House. It
was known here in March before he went to Paris and committed suicide there.
Mr. Chairman, I think the people of the United States are
entitled to know how many billions of dollars were placed
at the disposal of Kreuger and his gigantic combine by the
Federal Reserve Board and the Federal reserve banks and
to know how much of our Government currency was issued
and lost in the financing of that great swindle in the years
during which the Federal Reserve Board and the Federal
reserve banks took care of Kreuger's requirements.
Mr. Chairman, I · believe there should be a congressional
investigation of the operations of Kreuger and Toll in the
United States and that Swedish Match, International Match,
the Swedish-American Investment Corporation, and all related enterprises, including the subsidiary companies of
Kreuger and Toll, should be investigated and that the issuance of United States currency in connection with those
enterprises and the use of our national-bank depositors'
money for Kreuger's benefit should be made known to the
general public. I am referring, not only to the securities
which were floated and sold in this country, but also to the
commercial loans to Kreuger's enterprises and the mass
financing of Kreuger's companies by the Federal Reserve
Board and the Federal reserve banks and the predatory
institutions which the Federal R_eserve Board and the
Federal reserve banks shield and harbor.
A few days ago the President of the United States, with a
white face and shaking hands, went before the Senate on
behalf of the moneyed interests and asked the Senate to
levy a tax on the people so that foreigners might know that
the United States would pay its debts to them. Most Americans thought that it was the other way around. What does
the United States owe to foreigners? When and by whom
was the debt incurred? It was incurred by the Federal Reserve Board and the Federal reserve banks when they peddled the signature of this Government to foreigners for a
price. It is what the United States Government has to pay
to redeem the obligations of the Federal Reserve Board and
the Federal reserve banks. Are you going to let those thieves
get off scot free? Is there one law for the looter who drives
up to the door of the United States Treasury in his limousine
and another for the United States veterans who are sleeping
on the floor of a dilapidated house on the outskirts of
Washington?
The Baltimore & Ohio Railroad is here asking for a large
loan from the people and the wage earners and the taxpayers of the United States. It is begging for a hand-out
from the Government. It is standing, cap in hand, at· the
door of the Reconstruction Finance Corporation, where all
the other jackals have gathered to the feast. It is asking
for money that was raised from the people by taxation, and
it wants this money of the poor for the benefit of Kuhn,
Loeb & Co., the German international bankers. Is there one
law for the Baltimore & Ohio Railroad and another for the
needy veterans it threw off its freight cars the other day?
Is there one law for sleek and prosperous swindlers who call
themselves bankers and another law for the soldiers who
defended the United States flag?
Mr. Chairman, some people are horrified because the
collateral behind Kreuger and Toll debentures was removed
and worthless collateral substituted for it. What is this
but what is being done daily by the Federal reserve banks?
When the Federal reserve act was passed, the Federal
reserve banks were allowed to substitute "other like collateral " for collateral behind Federal reserve notes but by
an amendment obtained at the request of the corrupt and
dishonest Federal Reserve Board, the act was changed so
that the word " like " was stricken out. All that immense
trouble was taken here. in Congress so that the law would
permit the Federal reserve banks to switch collateral. At
the present time behind the scenes in the Federal reserve
banks there is a night-and-day movement of collateral. A
visiting Englishman leaving the United States a few weeks
ago, said that th.irigs would look better here after " they
cleaned up the mess at Washington." Cleaning up the mess
consists in fooling the people and making them pay a second time for the bad foreign investments of the Federal
:Reserve Board and the Federal reserve banks. It consists in moving -that heavy load of dubious and worthless foreign paper-the bills of wigmakers, brewers, distillers, narcotic-drug vendors, munition makers, illegal finance drafts,
and worthless foreign securities, out of the banks and putting it on the back of American labor. That is what the
Reconstruction Finance Corporation is doing now. They
talk about loans to -banks· and railroads but they say very
little about that other business of theirs which consists in
relieving the swindlers who promoted investment trusts in
this country and dumped worthless foreign securities into
them and then resold that mess of pottage to American
investors under cover of their own corporate titles. The
Reconstruction Finance Corporation is taking over those
worthless securities from those investment trusts with
United States Treasury money at the expense of the American taxpayer and wage earner.
It will take us 20 years to redeem our Government, 20
years of penal servitude to pay off the gambling debts of
the traitorous Federal Reserve Board and the Federal reserve banks and to earn again that vast flood of American
wages and savings, bank deposits, and United States Government credit which the Federal Reserve Board and the
Federal reserve banks e_xported out of this country to their
foreign principals.
The Federal Reserve Board and the Federal reserve
banks lately conducted an anti-hoarding campaign here.
Then they took that extra money which they had persuaded the trusting American people to put into the banks
and they sent it to Europe along with the rest. In the last
several months, they have sent $1,300,000,000 in gold to
their foreign employers, their foreign masters, and every
dollar of that gold belonged to the people of the United
States and was unlawfully taken from them.
Is not it high time that we had an audit of the Federal
Reserve Board and the Federal reserve banks and an examination of all our Government bonds and securities and
public moneys instead of allowing the corrupt and dishonest
Federal Reserve Board and the Federal reserve banks to
speculate with those securities and this cash in the notorious
open discount market of New York City?
Mr. Chairman, within the limits of the time allowed me,
I can not enter into a particularized discussion of the Federal Reserve Board and the Federal reserve banks. I have
singled out the Federal reserve currency for a few remarks
because there has lately been some talk here of "fiat
money." What kind of money is being pumped into the
open discount market and through it into foreign channels
and stock exchanges? Mr. Mills of the Treasury has spoken
here of his horror of the printing presses and his horror
of dishonest money. He has no horror of dishonest money.
If he had, he would be no party to the present gambling
of the Federal Reserve Board and the Federal reserve
banks in the nefarious open discount market of New York.
a market in which the sellers are represented by 10 great
discount dealer corporations owned and organized by
the very banks which own and control the Federal Reserve Board and the Federal reserve banks. Fiat money,
indeed!
After the several raids on the Treasury Mr. Mills borrows
the speech of those who protested against those raids and
speaks now with pretended horror of a raid on the Treasury. Where was Mr. Mills last October when the United
States Treasury needed $598,000,000 of the taxpayers' money
which was supposed to be in the safe-keeping of Andrew
W. Mellon in the designated depositories of Treasury funds,
and which was not in those depositories when the Treasury
needed it? Mr. Mills was the Assistant Secretary of the
Treasury then, and he was at Washington throughout October, with the exception of a very significant week he spent
at White Sulphur Springs closeted with international bankers, while the Italian minister, Signor Grandi, was being entertained-and bargained with-at Washington.
What Mr. Mills is fighting for is the preservation whole
and entire of the bankers' monopoly of all the currency of
the United States Government. What Mr. PATMAN proposes
is that the Government shall exercise its sovereignty to the
extent of issuing some currency for itself. This conflict of opinion between Mr. Mills as the spokesman of the bankers -and Mr. PATMAN as the spokesman of the people brings the
currency situation here into the open. Mr. PATMAN and the
veterans are confronted by a stone wall-the wall that
fences in the bankers with their special privilege. Thus the
issue is joined between the hosts of democracy, of which the
veterans are a part, and the men of the king's bank, the
would-be aristocrats, who deflated American agriculture and ,
robbed this country for the benefit of their foreign principals.
Mr. Chairman, last December I introduced a resolution here
asking for an examination and an audit of the Federal Re- •
serve Board and the Federal reserve banks and all related
matters. If the House sees fit to make such an investigation,
the people of the United States will obtain information of
great value. This is a Government of the people, by the
people, for the people, consequently nothing should be concealed from the people. The man who deceives the people
is a traitor to the United States. The man who knows or
suspects that a crime has been committed and who conceals
or covers up that crime is an accessory to it. Mr. Speaker,
it is a monstrous thing for this great Nation of people to
have its destinies presided over by a traitorous Government
board acting in secret concert with international usurers.
Every effort has been made by the Federal Reserve Board
to conceal its power but the truth is the Federal Reserve
Board has usurped the Government of the United States.
It controls everything here and it controls all our foreign
relations. It makes and breaks governments at will. No
man and no body of men is more entrenched in power
than the arrogant credit monopoly which operates the Federal Reserve Board and the Federal reserve banks. These
evil-doers have robbed this country of more than enough
money to pay the national debt. What the National Government has permitted the Federal Reserve Board to steal
from the people should now be restored to the people. The
people have a valid claim against the Federal Reserve Board
and the Federal reserve banks. If that claim is enforced,
Americans will not need to stand in breadlines or to suffer
and die of starvation in the streets. Homes will be saved,
families will be kept together, and American children will not be dispersed and abandoned. The Federal Reserve Board
and the Federal reserve banks owe the United States Government an immense sum of money. We ought to find out
the exact amount of the people's claim. We should know
the amount of the indebtedness of the Federal Reserve
Board and the Federal reserve banks to the people and we
should collect that amount immediately. We certainly
should investigate this treacherous and disloyal conduct of
the Federal Reserve Board and the Federal reserve banks.
Here is a Federal reserve note. Immense numbers of
these notes are now held abroad. I am tbld they amount to
upward of a billion dollars. They constitute a claim against
our Government and likewise a claim against the money
our people have deposited in the member banks of the Federal reserve system. Our people's money to the extent of
$1,300,000,000 has within the last few months been shipped
abroad to redeem Federal reserve notes and to pay other
gambling debts of the traitorous Federal Reserve Board and
the Federal reserve banks. The greater part of our monetary stock has been shipped to foreigners. Why should we
promise to pay the debts of foreigners to foreigners? Why
should our Government be put into the position of supplying money to foreigners? Why should American farmers
and-wage earners add millions of foreigners to the number
of their dependents? Why should the Federal Reserve
Board and the Federal reserve banks be permitted to finance
our competitors in all parts of the world? Do you know why
the tariff was raised? It was raised to shut out the :flood of
Federal reserve · goods pouring in here from every quarter
of the globe-cheap goods produced by cheaply paid foreign labor on unlimited supplies of money and credit sent out
of this country by the dishonest and unscrupulous Federal
Reserve Board and the Federal reserve banks. Go out in
Washington to buy an electric light bulb and you will
probably be offered one that was made in Japan on American money. Go out to buy a pair of fabric gloves and in-conspicuously written on the inside of the gloves that will
be offered to you will be found the words "made in Germany " and that means '' made on the public credit of the
United states Government paid to German firms in American gold taken from the confiscated bank deposits of the
American people."
The Federal Reserve Board and the Federal reserve banks
are spending $100,000,000 a week buying Government securities in the open market and are thus making a great bid for
foreign business. They are trying to make rates so attractive that the human-hair merchants and distillers and other
business entities in foreign lands will come here and hire
more of the public credit of the United States Government
and pay the Federal reserve outfit for getting it for
them.
Mr. Chairman, when the Federal reserve act was passed
the people of the United States did not perceive that a world
system was being set up here which would make the savings
of an American school-teacher available to a narcotic-drug
vendor in Macao. They did not perceive that the United
States was to be lowered to the position of a coolie country
which has nothing but raw materials and heavY goods for
export; that Russia was destined to supply man power and
that this country was to supply financial power to an international superstate-a superstate controlled by international
bankers and international industrialists acting together to
enslave the world for their own pleasure.
The people of the United States are being greatly wronged.
If they are not, then I do not know what " wronging the
people" means;· They have been driven from their employments. They have been dispossessed of their homes. They
have been evicted from their rented quarters. They have
lost their children. They have been left to suffer and to die
for the lack of shelter, food, clothing, and medicine.
The wealth of the United States and the working capital
of the United States has been taken away from them and
has either been locked in the vaults of certain banks and
great corporations or exported to foreign countries for the
benefit of the foreign customers of those banks and corporations. So far as the people of the United States are concerned, the cupboard is bare. It is true that the warehouses and coal yards and grain elevators are full, but the
warehouses and coal yards and grain elevators are padlocked and the great banks and corporations hold the keys.
The sack of the United States by the Federal Reserve Board
and the Federal reserve banks and their confederates is the
greatest criine in history.
Mr. Chairman, a serious situation confronts the House of
Representatives to-day. We are the trustees of the people
and the rights of the people are being taken away from
them. Through the Federal Reserve Board and the Federal reserve banks, the people are losing the rights guaranteed to them by the Constitution. Their prope1·ty has
been taken from them without due process of law. Mr.
Chairman, common decency requires us to examine the pulllie accounts of the Government to see what crimes against
the public welfare have been or are being committed.
What is needed here is a return to the Constitution of the
United States. We need to have a complete divorce of Bank
and State. The old struggle that was fought out here in
Jackson's day must be fought over again. The Independent
United States Treasury should be reestablished and the Government should keep its own money under lock and key in
the building the people provided for that purpose. Asset
currency, the device of the swindler, should be done away
with. The Government should buy gold and issue United
States currency on it. The business of the independent
bankers should be restored to them. The state banking
systems should be freed from coercion. The Federal reserve
districts should be abolished and State boundaries should be
respected. Bank reserves should be kept within the borders
of the States whose people own them, and this reserve money
of the people should be protected so that international bankers and acceptance bankers and discount dealers can not
draw 1t away from them. The exchanges should be closed
while we are putting our financial affairs in ocder. The Federal reserve act should be repealed and the Federal reserve banks, having violated their charters, should be liquidated immediately. Faithless Government officers who have
vioiated their oaths of office should be impeached and
brought to trial Unless this is done by us, I predict that the
American people, outraged, robbed, pillaged, insulted, and
betrayed as they are in their own land, will rise in their
wrath and send a President here who will sweep the money
changers out of the temple. [Applause.]
Mr. STRONG of Kansas. Mr. Chairman, I shall use the
remaining four minutes that I have at my disposal. There
is a disease that afilicts mankind which is very vicious. It
warps the judgment, it narrows the vision, it even causes
men to see red, to make mountains out of mole hills. This
disease has sometimes been referred to as B. A. Ladies may
refer to it as " tummy " ache, but out in the wide-open
spaces men call it the " belly " ache, and I know of no man
of my acquaintance that has this disease in so violent a
form as the gentleman from Pennsylvania [Mr. McFADDEN].
I have not the time to refer to the many charges he makes
against the Federal reserve system, but I call attention to
the fact that for 12 years he has been the chairman of the
Banking and CUrrency Committee of this House and did
not see fit during that time to try to remedy any of the
evils of which he now complains. It seems to me entirely
out of place to wait until he is retired as chairman of that
great committee and then assault all of the institutions of
which it has control.
I think this is a good bill. It is a bill that has been
proposed by the President and has been approved by the
Democratic chairman of the Banking and Currency Committee, on which there is a majority of Democrats, and
brought before this House with the approval of that committee. It seeks to make possible protection to the small
home owner. It seeks to make it possible for him to save
his home by the renewal of his loan, or to build a small
home and secure a loan upon it.
If there ever was legislation that is justified it is this bill,
to establish these home-loan banks. This bill bas been
very, very carefully considered. The gentleman from Wisconsin [Mr. REILLY} has been the very able chairman of the
subcommittee, and he and the gentleman from Massachusetts [Mr. LucE] who introduced the bill in this House h-ave
spent weeks with the subcommittee in holding hearings on
this bill. They have brought it here with their entire approval. I ask my friends on both sides of this House to
accept the judgment of those gentlemen and to pass this bill
with a splendid majority. We need it in this country. All
over this broad land the little home owner is being threatened with foreclosure on the home he loves and lives for.
This bill will give him relief, and I ask you to vote for the
bill. Be not led astray by those who have a violent disease,
to attack everything of a financial nature in the country.
[Applause.]
The CHAIRMAN. The time of the gentleman from
Kansas has expired.

Source: congress.gov

Source: congress.gov