1932 CONGRESSIONAL RECORD-SENATE 2125 Aus tin Couzens Hull Pittman The VICE PRESIDENT. The clerk will call the roll. Bailey Dale Jones Reed Barkley Davis Kendrick Robinson, Ind. The legislative clerk called the roll, and the following Sena Bingham Dickinson King Schall tors answered to their names: Black Frazier La Follette Sheppard Blaine George Logan Smith Ashurst Dale Kendrick Shlpstead Borah Hale McGill Steiwer Aus tin Dickinson Keyes Shortridge Bulkley Harris McKellar Trammell Bailey Dill King Smith Carey Hastings McNary Vandenberg Bankhead Fess La Follette Smoot Connally Hatfield Norris Walcott Barbour Fletcher Logan Steiwer White Bingham Frazier . McGill Swanson Copeland Hayden Nye Black George McKellar Thomas, Idaho Costigan Hebert Oddie Blaine Glass McNary Thomas, Okla. The PRESIDING OFFICER. Forty-seven Senators have Borah Glenn Metcalf Townsend answered to the roll call. There is not quorum present. Bratton Goldsborough Morrison Trammell a Brookhart Gore Moses Tydings ADJOURNMENT Bulkley Hale Neely Vandenberg Bulow Harris Norbeck Wagner Mr. McNARY. Mr. President, I had hoped that a quorum Byrnes Harrison Norris Walcott would be developed so that an executive session might be Capper Hastings Nye Walsh, Mass. Caraway Hatfield Odd1e Walsh, Mont. held. In view of the situation, however, I move that the Carey Hayden Patterson Waterman Senate adjourn. Connally Hebert Pittman Watson The motion was agreed to; and The VICE PRESIDENT also laid before the Senate the fol HousE o:r REPRESENTATIVE~ lowing concurrent resolution of the Legislature of South TENTH STATE LEGISLATURE, Carolina, which was referred to the Committee on Claims: FIRST SPECIAL SESSION. House Joint Memorial No. 4 A concurrent resolution To the honorable House of Representatives of the United States Whereas the United States collected from the cotton-growing of America in Congress assembled States a tax on cotton in 1866, 1867, and 1868 and there is esti Your memorialist, the Tenth Legislature of the State of Arizona, mated to be due to the people of South Carolina the sum of in special session convened, respectfully represents: $4,172,421.16; and Whereas the present deplorable condition of the copper indus Whereas there is a bill introduced in the House of Representa try and the great distress throughout the 11 Western States is tives directing the Secretary of the United States Treasury to directly attributable to the dumping upon the market of the refund the tax unlawfully levied and collected on raw cotton: United States of foreign copper produced by cheap foreign native Therefore be it labor; that back of this activity is a well-organized effort per Resolved by the house of representatives (the senate concur manently to destroy the copper-production industry of this coun ring), That the United States Congress be urged to pass this bill, try; that engaged in this effort is a combination of interests made introduced by Hon. B. B. HARE, and the South Carolina delegation up of foreign governments, foreign corp~rations, concessionaires in Congress be requested to secure the passage of same. of foreign governments, including American citizens, all acting Resolved further, That a copy of this resolution be sent to the in concert against the economic peace and welfare of our people. Speaker of the United States House of Representatives, the Presi So great has become the power of this international combination dent of the United States Senate, and the South Carolina dele that life's comforts and necessities of the people of whole States gation in Congress. may be and are jeopardized by their activities and their man IN THE HOUSE OF REPRESENTATIVES, dates. Thus had been set up in the world a supereconomic empire Columbia, S. C., January 15, 1932. so powerful that our State government lies impotent and helpless, I hereby certify that the foregoing resolution is a true copy of while due to their manipulations of the fruits of our industry the concurrent resolution adopted by the house and concurred in our citizens are ruthlessly deprived of their means of making a by the Senate. living and go marching into an ever-increasing bread line. Only (SEAL.) J. WILSON GmBES, the National Government itself has sufficient power to cope with Clerk of th'J House. the subtleties and machinations of such a gigantic scheme. A mere State government does not possess the constitutional power The VICE PRESIDENT also laid before the Senate a reso to protect its people against the operations of such a public lution adopted by the State board of the Wisconsin Division, menace. A foreign economic war has been declared against in dustry supporting our State and its people, and this war is now Service Star Legion Whenever ~ a--vacancy shall occur among the directors so appointed furl1te:r, That no fee or commission shall be- paid by any applicant . the person appointed to fill such vacancy shall hold office for the for a loan under the provisions hereof tn connection with any such unexp1red portion of the term of the director whose place he is application or any loan made or to be made hereunder, and the selected to fill. The directors of the corporation appointed as agreement to pay or payment of any such fee or commission shall hereinbefore provided shall receive salaries at the rate of $10,000 be unlawful. per annum each. No director, o1ficer, attorney, agent, or em SEc. 6. Section 5202 of the Revised Statutes of the United States, ployee of the corporation shall in any manner, directly or indi as amended, is hereby amended by striking out the words " War rectly, participate in the determination of any question affecting Finance Corporation act " and inserting in lieu thereof the words his personal interests, or the interests of any corporation, partner " Reconstruction Finance Corporation act." ship, or association, in which he is directly or indirectly interested, SEc. 7. All moneys of the corporation not otherwise employed nor shall any employee receive a higher salary than that herein may be deposited with the Treasurer of the United States, subject fixed for directors. to check by authority of the corporation, or in any Federal reserve SEC. 4. The corporation shall have succession for a period of 10 bank, or may, by authorization of the board of directors of the corporation, be used in the redemption and retirement of any years from the date of the enactment hereof, unless it is sooner notes, debentures, bonds, or other obligations issued by the cor dissolved by an act of Congress. It shall have power to adopt, poration, and the corporation may reimburse such Federal reserve alter, and use a corporate seal; to make contracts, to lease such bank for their services in the manner as may be agreed upon. real estate as may be necessary for the transaction of its business; The Federal reserve banks are authorized and directed to act as to sue and be sued, to complain and to defend in any court of depositaries, custodians, and fiscal agents for the Reconstruction competent jurisdiction, State or Federal; to select, employ, and Finance Corporation in the general performance of its powers con fix the compensation of such officers, employees, attorneys, and · ferred by this act. agents as shall be necessary for the transaction of the business of SEc. 8. In order to enable the corporation to carry out the pro- the corporation, without regard to the provisions of other laws visions of this act, the Treasury Department, the Comptroller of applicable to the employment and compensation of officers or em the Currency, the Federal Reserve Board, the Federal reserve ployees of the United States; to define their authority and duties, banks, and the Interstate Commerce Commission are hereby au require bonds of them and fix the penalties thereof, and to dis thorized, under such conditions as they may prescribe, to make miss at pleasure such officers, employees, attorneys, and agents; available to the corporation in confidence such reports records or and to prescribe, amend, and repeal, by its board of directors, by other information as they may have available relating 'to the c~n laws, rules, and regulations governing the manner in which its dition of financial institutions and railroads or railways with general business may be conducted and the powers granted to it respect to which the corporation has had or contemplates having by law may be exercised and enjoyed, including the selection of transactions under this act, or relating to individuals, associa its chairman a.nd vice chairman, together wtth provision for such tions, partnerships, or corporations whose obligations are offered committees and the functions thereof as the board of directors may to or_ held by the corporation as security for loanS to financial deem necessary for facilitating its business under this act. The institutions or railroads or railways under· this act, and to make board of directors of the corporation shall determine and prescribe through their examiners or other employees for the -confidential the manner in which its obligations shall be incurred and its ex use of the corporation examinations of such financial institutions penses allowed im.d paid. The corporation shall be entitled to the or railroads and railways. Every applicant for a loan under this free use of the United States mails in the same manner as the act shall, as a condition precedent thereto, consent to such exami nations as the corporation may require for the purposes of this executive departments of the Government. The corporation, with act and that reports of examinations by constituted authorities the consent of any board, commission, independent establishment, may be furnished by such authorities to the corporation upon or executive department of the Government, including any field request therefor. · · service thereof, may avail itself of the use of information, services, SEC. 9. The corporation is authorized and empowered, with the fac111ties, o:tlicers, and employees thereof in carrying out the provi approval of the Secretary of the Treasury, to issue, and to have sions of this act. outstanding at any one time in an amount aggregating not more SEc. 5. To aid in financing agriculture, commerce, and industry, than three times its subscribed capital, its notes, debentures, including facilitating the exportation of agricultural and other bonds, Ol" other such obligations; such obligations to mature not products the corporation is ·authorized and empowered to make more than five years from their respective dates of iS&ue; to be loans, upon such terms and conditions not inconsistent with this redeemable at the option of the corporation before maturity in act as it may determine, to any bank, savings bank, trust com such manner as may be stipulated in such obligations, and to bear pany, ·building and loan association, insurance company, inter such rate or .rates of interest as may be determined by the corpo mediate credit bank, agricultural credit corporation, livestock ration: Provtded, That t~e corporation, with the approval of the credit corporation, and any agricultural or farmers' association in Secretary of the Treasury, may sell on a discount basis short-term corporated under the laws of any State, or other bona fide finan obligations payable at maturity without interest. The notes, de cial institution in the United States (herein referred to as financial bentures, bonds, and other obligations of the corporation may be institutions), including loans secured by the assets of any bank secured by a.Ssets of the corporation in such manner as shall be that is closed, insolvent, or in process of liquidation to aid in the prescribed by its board of directors: Provided furthe:r, That the reorganization or liquidation of such banks, upon application of aggregate of all obligations issued under this section shall not the receiver or liquidating agent of such bank, and any receiver exceed three times the amount of the outstanding capital stock. of any national bank is hereby authorized to contract for such Such obligations may be issued in payment of any loan author loans and to pledge any assets of the bank for securing the same. ized by this act or may be offered for sale at such price or prices All loans made under the foregoing provisions shall be fully and as the corporation may determine with the approval of the Sec adequately secured~ The corporation, under such conditions as it shall prescribe, may take over or provide for the adm.1nistration retary of the Treasury. In the event that the corporation shall be and liquidation of any collateral accepted by it as security for unable to pay upon demand, when due, the principal of or inter such loans. Such loans may be made directly upon prollill!sory est on notes, debentures, bonds, or other such obligations issued notes of such financial instttutions, or by way of discount or re by it, the Secretary of the Treasury shall pay the amount thereof, discount of obligations tendered by them for the purpose, or other which is hereby authorized to be appropriated, out of any moneys· wise in such form and in such amount and at such interest or in the Treasury not otherwise appropriated, and thereupon to the discount rates as the corporation may approve. Each such loan extent of the amounts so paid the Secretary of the Treasury shall may be made for a period not exceeding three years, and the cor succeed to all the rights of the holders of such notes, debentures, poration may from time to time extend the time of payment of bonds, or other obligations. The Federal reserve banks shall have any such loan, through renewal, substitution of new obligations, the same powers ( 1) to discount notes, drafts and bills of ex or otherwise, but the time for such payment shall not be extended change secured by obligations issued by the corporation under beyond five years from the date upon which such loan was made this act, ( 2) to make advances to member banks on their notes· originally. The corporation may make loans under this section secured by such obligations, (3) to use all paper so acquired, and at any time prior to the expiration of one year from the date of (4) to purchase and sell such obligations, as they have with the enactment hereof; and the President may from time to time respect to bonds and notes of the United States: Provided, That postpone such date of expiration for such additional period or the rate at which any such discount or advance shall be made by periods as he may deem necessary, not to exceed two years from any Federal reserve bank shall be 1 per cent per annum above its the date of the enactment hereof. Within the foregoing limita discount rate on 90-day commercial paper then in effect. tions of this section, the corporation may also, upon the recom SEc. 10. Any and all notes, debentures. bonds, or other such obli mendation and approval of the Interstate Commerce Commission, gations issued by the corporation shall be exempt, both as to make loans to aid in the temporary financing of railroads and rail principal and interest, from all taxation except surtaxes, estate, ways engaged in interstate commerce, to railroads and railways in inheritance, and gift taxes now or hereafter imposed by the United process of construction, and to receivers of railroads and railways, States, by any Territory, dependency, or possession thereof, or by when in the opinion of the board of directors of the corporation any State, county, municipality, or local taxing authority. The such railroads or railways are unable to obtain funds upon reason corporation, including its franchise, its capital, reserves, and sur able terms through banking channels or from the general public plus, and its income, shall be exempt from all taxation now or and the corporation will be adequately secured: Provided, That hereafter imposed by the United States, by any Territory, depend no loans or advances shall be made upon foreign securities and ency, or possession -thereof, or by any State, county, municipality, foreign acceptances or for the purpose of assisting in carrying or or local taxing authority, except that any real property of the liquidating such foreign securities and foreign acceptances. In no corporation shall be subject to State, county, municipal, or local case shall the aggregate amount of advances made under this sec taxation to the same extent according to its value as other real tion to any one corporation and its subsidiary or a:tliliated organi property is taxed. zations exceed at any one time 10 per cent of (1) the authorized SEc. 11. In order that. the corporation may be supplied With capital stock of the Reconstruction Finance Corporation plus (2) such forms of notes, debentures, bonds, or other such obligations the aggregate amount of bonds of the corporation authorized to as it may need for issuance under this act the Secretary of the be _outstanding when the capital stock is fully paid in: Provided Treasury is authorized to prepare such forms as shall be suitable 1932 CONGRESSIONAL RECORD-SENATE 2135 and approved by the corporation, to be held 1n the Treasury sub the corporation, knowtng the same to be falsely altered or spuri ject to delivery, upon order of the corporation. The engraved ous, or any person who willfully violates any other provision of plates, dies, bed pieces, etc., executed in connection therewith •shall this act, shall be punished by a fine of not more than $10,000 or remain in the custody of the Secretary of the Treasury. The cor by imprisonment for not more than five years, or both. poration shall reimburse the Secretary of the Treasury for any (c) Whoever, being.connected in any capacity with the corpora expenses incurred in the preparation, custody, and delivery of such tion, (1) embezzles, abstracts, purloins, or willfully misapplies any notes, debentures, bonds, or other obligations. moneys, funds, securities, or other things of value, whether belong SEc. 12. When designated for that purpose by the Secretary of ing to it or pledged or otherwise intrusted to it, or (2) with intent the Treasury, the corporation shall be a depositary of public money, to defraud the corporation or any other body politic or corporate, except receipts from customs, under such regulations as may be or any individual, or to deceive any officer, auditor, or examiner o:r prescribed by said Secretary; and it may also be employed as a the corporation, makes any false entry in any book, report, or financial agent of the Government; and it shall perform all such statement of or to the corporation, or, without being duly author reasonable duties, as depositary of public money and financial ized, draws any order or issues, puts forth or assigns any note, de agent of the Government, as may be required of it. Obligations benture, bond, or other obligation, or draft, bill of exchange, mort of the corporation shall be lawful investments, and may be ac gage, judgment, or decree thereof, or (3) participates, shares, re cepted as security, for all fiduciary, trust, and public funds the ceives directly or indirectly any money, profit, property or benefit investment or deposit of which shall be under the authority or through any transaction, loan, commission, contract, or any other control of the United States or any officer or officers thereof. act of the corporation, or (4) gives any unauthorized information SEc. 13. Upon the expiration of the period of one year within concerning any future action or plan of the corporation which. which the corporation may make loans, or of any extension thereof might affect the value of securities, or having such knowledge, by the President ~er the authority of this act, the board of invests or speculates, directly or indirectly, in the sceurities or dixectors of the corporation shall, except as otherwise .herein property of any company, bank, or corporation receiving loans or specifically authorized, proceed to liquidate its assets and wind up other assistance from the corporation, shall be punished by a fine its affairs. It may, with the approval of the Secretary of the of not more than $10,000 or by imprisonment for not more than Treasury, deposit with the Treasurer of the United States a~ a five years, or both. special fund any money belonging to the corporation or from trme (d) No individual, association, partnership, or corporation shall to time received by it in the course of liquidation or otherwise, for use the words "Reconstruction Finance Corporation," or a com the payment of principal and interest of its outstanding obliga bination of these three words, as the name or a part thereof under tions or for the purpose of redemption of such obligations in which he or ·it shall do business. Every individual, partnership, accordance with the terms thereof, which fund may be drawn association, or corporation violating this prohibition shall be upon or paid out for no other purpose. The corporation may guilty of a misdemeanor and shall be punished by a fine of not also at any time pay to the Treasurer of the United States as exceeding $1,000, or imprisonment not exceeding one year, or both. miscellaneous receipts any money belonging to the corporation or (e) The provisions of sections 112, 113, 114, 115, 116, and 117 from- time to time received by it in the course of liquidation or of the Criminal Code of the United States (U. S. C., title 18, ch. 5, otherwise in excess of reasonable amounts reserved to meet its sees. 202 to 207, inclusive), in so far as applicable, are extended requirements during liquid~tion. Upon such deposits being made, to apply to contracts or agreements with the corporation under such amount of the capital stock of the corporation as may be this act, which for the purposes hereof shall be held to include specified by the corporation with the approval of the Secretary of loans, advances, discounts, and rediscoupts; extensions and renew the Treasury, but not exceeding in par value the amount so paid als thereof; and acceptances, releases, and substitutions of security in, shall be canceled and retired. Any balance remaining after therefor. the liquidation of all the corporation's assets and provision being made for payment of all legal obligations of any kind and char SEc. 17. The right to alter, amend, or repeal this act is hereby acter shall be paid to the Treasurer of the United States as mis expressly reserved. If any clause, sentence, paragraph, or part of cellaneous receipts. Thereupon the corporation shall be dissolved this act shall for any reason be adjudged by any court of com and the residue, if any, of its capital stock shall be canceled and petent jurisdiction to be invalid, such judgment shall not-affect, retired. impair, or invalidate the remainder of this act, but shall be con SEc. 14. If at the expiration of the 10 years for which the cor fined in its operation to the clause, sentence, paragraph, or part poration has succession hereunder its board of directors shall not thereof directly involved in the controversy in which such judg have completed the liquidation of its assets and the winding up of ment shall have been rendered. its affairs, the duty of completing such liquidation and winding up During the reading of the bill, _ of its affairs shall be transferred to the Secretary of the 'ITeasury, who for such purpose shall succeed to all the powers and duties Mr. SHORTRIDGE. Mr. President, I respectfully sug of the board of directors of the corporation under this act. In gest that the further reading of the House bill would be a such event he may assign to any officer or om.cers of the United waste of time and energy. The Senate, after due delibera States in the Treasury Department the exercise and performance, under his general supervision and direction, of any such powers tion, passed a Senate bill dealing with this subject, and the and duties; and nothing herein shall be construed to affect any House, after mature consideration, passed the bill which is right or privilege accrued, any penalty or liability incurred, any before us. It might be helpful if some Senator would point criminal or civil proceeding commenced, or any authority con out wherein the bills differ; but to proceed to read further ferred hereunder, except as herein provided in connection with the liquidation of the remaining assets and the winding up of the would be of no benefit, I submit with respect. affairs of the corporation, until the Secretary of the Treasury shall The PRESIDENT pro tempore. The reading of the bill find that such liquidation will no longer be advantageous to the was by the request of the senior Senator from Michigan United States and that all of its legal obligations have been pro vided for, whereupon he shall retire any capital stock then out [Mr. CouzENS]. It can not be put aside except by unani standing, pay into the 'ITeasury as miscellaneous receipts the mous consent. unused balance of the moneys belonging to the corporation, and Mr. SHORTRIDGE. I understand that. make the final report of the corporation to the Congress. There upon the corporation shall be deemed to be dissolved. Mr. ROBINSON of Arkansas. Mr. President, the reading SEC. 15. The corporation shall make and publish a report quar of the bill has been almost completed, and while, I have terly of its operations to the Congress stating the aggregate loans been interrupted five or six times during the progress of the made to each of the classes of borrowers provided for and the num reading, my thought being unavoidably diverted from the ber of borrowers by States in each class. The statement shall show the assets and liabilities of the corporation, and the first report provisions of the bill, I think it would be a very good thing shall be made on April 1, 1932, and quarterly thereafter. to complete the .reading of the bill in order that Senators SEc. 16. (a) Whoever makes any statement knowing it to be may know what are the House provisions. false, or whoever willfully overvalues any security, for the purpose of obtaining f.or himself or for any applicant any loan, or extension Mr. SHORTRIDGE. I beg to suggest to my friend the thereof by renewal, deferment of action, or otherwise, or the ac Senator froni Michigan, with great respect, that the further ceptance, release, or substitution of security therefor, or for the reading be dispensed with. purpose of influencing in any way the action of the corporation, or for the purpose of obtaining money, property, or anything of value, Mr. COUZENS. Mr. President, with due respect to the under this act, shall be punished by a fine of not more than $5,000 Senator from California, he has taken up more time by his or by imprisonment for not more than two years, or both. interruption than would have been taken in completing the (b) Whoever (1) falsely makes, forges, or counterfeits any note, reading of the bill. d·ebenture, bond, or other obligation, or coupon, in imitation of or purporting to be a note, debenture, bond, or other obligation, or The PRESIDENT pro tempore. The request was for the coupon, issued by the corporation, or (2) passes, utters or pub reading of the bill, and it can not be suspended except by lishes, or attempts to pass, utter or publish, any false, forged, or unanimous consent. The clerk will continue the reading. counterfeited note, debenture, bond, or other obllgatton, or coupon, purporting to have been issued by the corporation, knowing the After the reading of the bill, same to be false, forged, or counterfeited, or (3) falsely alters any The PRESIDENT pro tempore. The bill is before the note, debenture, bond, or other obligation, or coupon, issued or pur Senate and open to amendment. The Senator from Con porting to have been issued by the corporation, or _(4) passes, utters or publishes, or attempts to pass, utter or publlsh, as true . necticut lMr. WALCOTT] offers as an amendment the text of any falsely altered or spurious note, debenture, bond, or other Senate bill No. 1 as it passed the Senate. That amendment obligation, or coupon, issued or purporting to have been issued by is subject to amendment. 2136 CONGRESSIONAL -RECORD-SENATE JANUARY 18 Mr. COPELAND; Mr. PresideD.~ I offer as an· amendment · So they are declining to advance this ·money. Of course, to the amendment the following. we have a special problem in New York,. as the Senator The PRESIDENT pro tempore. The amendment to the knows, but if my amendment is adopted it will solve the amendment will be stated. problem of Boston, Philadelphia, and other cities. The CHIEF CLERK. The Senator from New York offers Mr. WALSH of Massachusetts. May I suggest to the the following amendment to the amendment. Insert on Senator that he change his amendment by striking out the page 8 after line 6: word "cities" and inserting the word "municipalities," as Within the foregoing limitations of this section the corporation there are several large towns, larger than many cities in may also make loans to a State or city to aid in temporary various parts of the country, that ought to have the benefit financing when, in the opinion of the board of directors of the of this legislation. corporation·, such State or city is unable to obtain funds upon reasonable terms through banking channels or from the general . Mr. COPELAND. In my original amendment offered public and the character and value of the security offered are last week I did have the word "municipalities." Then it such as to furnish adequate assuTance of ability to repay within was pointed out that there are various drainage systems, the time fixed therefor and to meet other obligations in connec tion therewith: Provided, That the aggregate sums advanced for reclamation and other projects which have· teen recog this purpose shall not exceed $200,000,000 at any one time. nized as municipal activities. I did not care to go so far The PRESIDENT pro tempore. The question is on agree so as to include in the bill every subdivision of government. ing to the amendment proposed by the Senator from New including counties, townships, and so forth. Of course, if York to the amendment. the Senator has some language that he thinks will better - Mr. McNARY. Mr. President, may I ask if the Senator cover it, I am willing that he shall offer it. I have no desires to discuss his amendment? - pride of authorship. I want to get relief; that is all. Mr. COPELAND. Very briefly. Does the Senator have Mr. WALSH of Massachusetts. I have in mind a town in something in mind? my State which has a population of over 30,000 that would Mr. McNARY. Before a vote is taken, in order that the not come within the. term "city." Senate may express itself, I wish to suggest the absence of Mr. COPELAND. I suppose we could use the words a quorum. "towns and cities." · Mr. WALSH of Massachusetts. Mr. President, may I in Mr. SHORTRIDGE. Mr. President, will the Senator quire of· the Senator from New York whether the amend yield? ment takes care of the suggestion made in the telegram of The PRESIDENT pro tempore. Does the Senator from the mayor of Boston read here to-day? New York yield to the Senator from California? Mr. COPELAND. Absolutely. Mr. COPELAND. I yield. · Mr. WALSH of Massachusetts. The Senator realizes that Mr. SHORTRIDGE. · Is there any material difference or difficulties with which the mayor of New York has been any difference at all between the amendment now proposed confronted in obtaining loans apparently exist in the city ·of and the amendment proposed last week to the pending bill? Boston. · Mr. COPELAND. There is some difference. The amend Mr. COPELAND. Yes. We have exactly the same situa ment includes the States as well as the cities, and also pro tion as regards the period between tax collections as that vides that ther e shall be limitation upon the amounts referred to by Mayor Curley, of Boston. advanced. It was pointed out in the debate the other day Mr. WALSH of Massachusetts. I notice that he pointed and has been told me in private conversation that if it were . out the fact that investment houses who heretofore have left without a limitation the needs of the cities might taken care of these temporary loans are now in no position absorb the entire $2,000,000,000. to finance the loans. Mr. SHORTRIDGE. The amendment which was consid Mr. COPELAND. That is true. ered and voted upon was limited to municipalities, was it Mr. WALSH of Massachusetts. Is it a fact that the not? · bankers have left the financing to investment houses, who Mr. COPELAND. It was-. are apparently removed from the field of investing in such Mr. SHORTRIDGE. The present amendment is enlarged State or city securities? to include States? Mr. COPELAND. Heretofore that has been the practice Mr. COPELAND. That is correct, because, as the article of the so-called municipal bankers. from which I quoted a moment ago states, between the pe Mr. WALSH of Massachusetts. Is the reason why the riods of tax collection there is a time when many of the banking houses hesitate abnut taking over the securities be States need funds to bridge themselves over until further cause they have not handled them in the past? taxes are collected. Mr. COPELAND. No. Mr. SHORTRIDGE. May I say that the RECORD is here Mr. WALSH of Massachusetts. Is it because they are and my attitude is there recorded. I . can well ·understand doubtful of their validity? whY a city might be in a certain condition, for reasons stated, Mr. COPELAND. Not at all; but they make the claim and which ought to be assisted, but is there a wayside sov that their fUnds are so low now that they have none for this ereign State in this Union that would fall into such a condi purpose. tion that it would be necessary to appeal to the Federal Mr. wALSH of Massachusetts. That their assets are Government? It seems to me, without enlarging my views, frozen? that any one of our 48 States is competent to meet a situa Mr. COPELAND. Yes; so they are asking relief through tion and ought not to be required or invited to turn to the the bill which is pending here .in order that some of their Federal Government. assets may be thawed out. · But at the same time they are Mr. ROBINSON of Arkansas. Mr. ·President. with the giving no encouragement to the States or municipalities permission of the Senator from New York-- who are seeking these short-term loans. Mr. COPELAND. I yield. I wonder if the Senator read the financial page in the Mr. ROBINSON of Arkansas. May I point out to the New York Times of yesterday. It contained a very con Senator from California that the logic of his argument servative statement, from which I ·wish to quote, as follows: would apply to the cities, since they are subdivisions of the Municipal bankers have been and are being besieged by State States. To my mind, there is no logic in excluding the and municipal officials from all sections of the country, who de States and giving to subdivisions of the States recognition mand to know why their communities. with generations of his . tory of prompt payments of their obligations behind them, can in matters of this nature which is denied the States . not borrow money readily for their legitimate needs. There is a question which quite naturally arises as to The replies of the bankers, in substance, have been that the whether the provisions of the bill should be extended to demand for State and municipal bonds has declined to such an extent that they do not feel justified in making commitments in include political' subdivisions like States or cities, but cer new issues. tainly if the ..credit is extended to cities within the States 1932 CONGRESSIONAL -RECORD-SENATE 2137 there is no logical reason in denying the same recognition we had in December, in sening Federal securities to inves to the States themselves. tors. We have a very serious condition in the market fo:r Mr. REED. Mr. President, will the Senator from New Federal bonds· at this moment. .There is reason to hope that York permit a question? if we are careful, the market is going to improve; but when Mr. COPELAND. I yield to the Senator from Pennsyl we look at the quotations of the bonds we sold last Septem vania. ber at par and find them selling to-day at 82, it is a very . Mr. REED. I am extremely anxious to get the opinion plain warning to the United States Government that that of the Senator from Arkansas on the fundamental question process can not be carried much farther, or we are going to which he has just mentioned. I agree with him that there meet trouble. We shall have lifted the emergency off the ,. is no reason why a city should not be included if we are shoulders of Mayor Walker, who has spent the money, and going to give aid to a State, nor do I see why we should put it on the shoulders of ourselves and the. rest of the not include counties, drainage districts, poor districts, and Federal Government here in Washington. every other municipal organization within the United States. The sum of $200,000,000 in these days we ha-ve learned to vThe fundamental questio_n is, ~hy should we use the F! d think of as not such a large amount, but $200,000,000 added eral taxing power to bnng relief o any ta e or mumc1pa- to the next issue of bonds that the Federal Government has . it - Which 1 self has a ta,eil')k .RQ.Wer andwli!.s 1 selfo ught to offer to investors may mark the difference between the to ra1se axes or borrow money to meet its own- o 1ga ions? success and failure of that issue. Is itw!Se'? omit... tne question of whether it- is constitu Philadelphia, I know, is in a similar condition. It was tional, but is it wise and sound for us to use Federal money lli""lable to sell its bonds to bankers, and it has been trying to to pay State and city debts? sell them over the counter, peddling them itself to p1·ivate Mr. ROBINSON of Arkansas. The answer to that ques investors. It has met with a remarkable degree of success in tion is that the provision is an emergency provision; that doing so, but I think it is all wrong, even if Philadelphia is without doubt the States and the cities ought to balance in my State, to tax the people· of Arkansas to pay for Phila their own budgets wherever that is possible and ought to delphia's troubles. I say "Arkansas" because I addressed the look to the resources of their citizens and their own _systems question to the Senator from that State. of taxation for the revenues necessary to carry on their I think it is all wrong, no matter whether we ourselves -: activities. The only justification is the same justification find our particular c1hes benefitmg by the action or not. which underlies many of the provisions in both the Senate l is wro -nnc1 e e ave never done 1 efore in \ and the House bills. all e panics that have affi.icted this country, and we have Let me say now that I do not think either the Senate or endured seven or eight major panics, and this is not much , the House bill is very strongly intrenched in sound eco worse than they were. We ·have never resorted to such a nomic principles, but I feel that this is an emergency meas plan as that now. proposed. We have never used the strong ure and if there is a limitation imposed on the amount that arm of the Federal Government to raise taxes for their bene- may be available for the purposes of the Senator's amend fit, nor have we used the Federal credit to sell bonds to be ment I am willing to extend the relief granted in the bill applied to their use. If we shall do so, we are going to cause because of the circumstances which have been repeatedly a situation that will be something like :that we are. in with stated here. I do not think anything is to be accomplished our former allies of the World War. We used American by undertaking to confine the provisions of this bill within credit to raise money for them, but the moment we spoke "sound economic principles," because most of its provisions about repayment we became "Uncle Shylock," to be dis would not be acceptable in normal times. . dained and detested. So will we be with the mayor of New Mr. SHORTRIDGE. Mr. President, will the Senator from York when we invite him to repay this money that he has New York permit me to interrupt him? ~ gotten from the Federal Treasury. We shall have presented· The VICE PRESIDENT. Does the Senator from New even more reasons for canceling that debt than those our York yield to the Senator from California? former allies are now mustering in their effort to obtain .,...,....- Mr. COPELAND. I yield. another " hand-out " from the United States. · Mr. SHORTRIDGE. Responding to the thought of the Mr. WALCOT!'. Mr. President- Senator from Arkansas [Mr. ROBINSON], I desire to say that The VICE PRESIDENT. Does the Senator from New I see a vast difference between a quasi-sovereign State, with York yield to the Senator from Connecticut? all its powers, and a municipality organized under its con Mr. COPELAND. In just a moment I will yield. The stitution or its laws. I can see, without elaborating my Senator from Pennsylvania has paid his respects to Mayor views, that as to a municipality there might be an emer Walker. Is it any worse for Mayor Walker to want to gency which would warrant aid from the Federal Govern receive some help in this' emergency than it is for the Penn ment, but that as to a State as a quasi-sovereign entity a sylvania Railroad, which runs through the Senator's State, different case is presented. to ask for aid through this proposed legislation? Mr. ROBINSON of Arkansas. Mr. President, I feel com Mr. REED. I am · not trying to help the Pennsylvania pelled to interrupt the Senator to say that the logic of the Railroad, and the Senator from New York knows it. I am proposition is that the subdivision of the State should go trying to help the security holders of the_Pennsylvania Rail to the State itself before applying to the Federal Government. road, who are the banks that hold the money of all the Mr. SHORTRIDGE. I am merely explaining in brief why people of the United States. in the one case I might be impelled to give Federal aid and in the other to withhold it. · Mr. COPELAND. I approve that, but I am trying to help Mr. REED. Mr. President, will the Senator from New the holders of securities of my State and city. York yield to me? Mr. REED. The way to help them is to use the taxing The VICE PRESIDENT. Does the Senator from New York power of the State of New York to rehabilitate its credit yield to the Senator from Pennsylvania? and by cutting out some of its extravagances. The same Mr. COPELAND. I yield. thing is true of Philadelphia. I ani not trying to put the :Mr. REED. The effort to justify the amendment because blame on Mayor Walker as distinguished from mayors of of an emergent situation I know appeals to all of us, but, other cities, in all of which, perhaps, there has been shocking after all, that emergency exists here in Washington just as extravagance. They have spent money with then· eyes shut, much as it exists in the city of New York, and if we are and they are the people to assume the burden and pay the going to pile the burdens of all subordinate governmental bill, and not the Federal taxpayers. organizations, such as New York City, on the back of the Mr. ROBINSON of Arkansas. Mr. President, will the Sen Federal Government here in Washington,· they will not have ator from New York yield to me? trouble raising money from bankers imd dealers in bonds; The VICE PRESIDENT. Does the Senator from New they will not have trouble in New York in selling their city York yieJd to th_e Senator from Arkansas? bonds to New York bankers; but we shall have trouble, as Mr. COPELAND. I yield. 2138 CONGRESSIONAL .RECORD-SENATE JANUARY 18 Mr. ROBINSON of Arkansas. - Mr. President, there is example, to the State o! New York, or to Florida, which is much force in the statement just made by the Senator from a fairly good State. Pennsylvania. It is also true that Federal agencies and the Mr. FLETCHER. Mr. President, let me say that Florida Federal Government itself have been expending money in does not approve of this amendment. excess of what ought to have been expended. It is likewise Mr. VANDENBERG. Mr. President--- true that there is urgent necessity for the Federal Govern Mr. COPELAND. I yield to the Senator from Michigan. ment balancing its own budget. l'.fr. VANDENBERG. Passing for the moment the funda- This thought it seems to me is worthy of some considera mental question, upon which I cordially agree with the Sen tion: There has been a shrinkage in revenue, National, State, ator from Pennsylvania [Mr. REED], may I ask the Senator 't and municipal; there is immediate necessity for the early from New York this question? He provides now a limita balancing of -budgets as to all these political subdivisions. I tion in this amendment of $200,000,000, stating that the would not think of supporting the amendment, even in its necessity for the limitation is the fact that the normal present form, were it not for the fact that I believe a proper demand without limitation might exhaust the entire $2,000,-:- administration of the provisions of the amendment will help 000,000. Upon that premise, does it not follow that under to accomplish the general purpose that runs through and his amendment as limited, if adopted, there would be simply underlies the Reconstruction Finance Corporation bill. a favored class of first-comers who would exhaust the fund, As I have stated before, when you undertake to ascribe and there would be no general uniform advantage, but a great' merit, immeasurable merit, to other provisions of the mere subverting of the purposes and resources of the cor bill which admittedly are necessary and then condemn this poration? provision you find that a very similar principle would apply Mr. COPELAND. Has not the Senator more confidence to many-of the beneficiaries now in the bill. In the first in his President than to think that he would put this cor place, we are using the taxing power of the Federal Govern poration in charge of men who would be so inconsiderate of ment to rehabilitate private financial institutions. We find the needs of the country? it necessary to accomplish that end, and, while we are doing Mr. VANDENBERG. It is not a question of the ability of that, it is not consistent, in my judgment, to say that it is the men who will administer the corporation; it is a ques sound economically to employ the strong arm of the Federal tion-- Government and its taxing power to accomplish a wholesome Mr. COPELAND. We are proposing to put all the power and necessary end for private institutions, but under no cir in the hands of the corporation. cumstances can similar methods be resorted to in aid of Mr. VANDENBERG. It is a question of the extent of the public institutions. resources. The Senator says that he has put a limit of . The whole theory of this bill is that faith and credit have $200,000,000 into the amendment because otherwise there _broken down; that confidence is so totally lacking that it is might arise a demand for the entire $2,000,000,000 for this necessary to put pillars under it in order to uphold it. While purpose. ~ realize that, as a precedent, peace-time legislation of this Mr. COPELAND. No; I do not say that, Mr. President. I character is to be safeguarded in every possible way, it does do not know how great the demand will be; but I do not seem to me we ought to make it as reasonable and as liberal think it would be for a dollar so far as my city is concerned. as we can, having in view the thought that the most im In my opinion, the minute the bankers saw that we had portant problem now before the National Government and some other place to get the money if they did not supply it, before almost every State in this Union is the readjustment they would supply the money because of the excellence of ef finances so as to balance expenditures with revenues. If the security. I put in the $200,000,000 limitation because it that is not done, the credit of the States will fail, and with did not seem fair to me that under any circumstances the respect to the National Government, if it is not done through whole $2,000,000,000 should be used for this specific purpose. the power of Congress to legislate to limit expenditures and I want the railroads helped; I want the insurance companies to provide revenue, the credit of the United States also will helped; I am in entire sympathy with the purpose of the bill. be impaired. That is beyond doubt the most important But, beside being in sympathy with the purposes· of the bill, end to be conserved by the Congress in its deliberations. I think that we should include Government corporations - Mr. SHORTRIDGE and Mr. VANDENBERG addressed the because of the difficulty they are experiencing in secm·ing Chair. money. There are specific reasons for it in my city in that The VICE PRESIDENT. Does the Senator from New York bankers are denying loans to the city because of their desire yield; and if so, to whom? relating to a 10-cent fare. . Mr. COPELAND. I yield first to the Senator from Cali Mr. WALCOTT. Mr. President--- fornia. Mr. COPELAND. I yield to the Senator from Connecticut. Mr. SHORTRIDGE. Does the Senator tell us that there is Mr. WALCOTT. It seems to me that the Senator from any one State of our Union asking for a loan from the Fed Michigan has gotten at the meat of this matter. It will eral Government? Should we adopt this amendment, and take a Solomon to decide how this $200,000,000 shall be par should the House and Senate agree to it and it should be celed out when the queue forms for municipal relief. come a law, does the Senator think that the great State of I should like to read two short extracts from a letter that New York or the State of Pennsylvania or the State of Ar I wrote to Mayor Curley yesterday in reply to a long tele kanSas or another great State I know far out to the West-- gram received from him. That telegram has just gone in Mr. ROBINSON of Arkansas. California? the RECORD. Mr. SHORTRIDGE. Yes; California-would come to the The four largest cities in the United States are facing to-day Federal Government asking for relief under the bill under serious financial problems. When one realizes that in 1929 the cities of the United States having a population of more than consideration? 30,000 spent approximately three and a half billion dollars, it ts Mr. COPELAND. I assume the Senator , wants a frank easy to foresee the intolerable burden that would result if the answer. . Federal Government attempted to do this financing, or any sub- Mr. SHORTRIDGE. I do, indeed. stantial portion of it, even for one year. These cities collected in .ci· _ taxes $2,200,000,000, but were left at the end of the year 1929 with Mr. COPELAND. I do not think that any State Or mum a net indebtedness of over $6,000,000,000. pality would be required to go to the Finance Corporation, I realize fully the serious condition that confronts some of the because, if we adopt this amendment, the banks would large cities 1n the country; but this reconstruction bill was not then take care of them if the situation is at all like that in designed to lend aid in that direction, as there was no indica- tion from any municipality during the hearings on this bill that my city. it needed financial assistance other than was obtainable through Mr. SHORTRIDGE. I am confining myself now to the the regular channels. Senator's amendment as applied to States. I voted for his I thank the Senator. amendment as it applied to municipalities and other sub- Mr. COPELAND. Mr. President, no witness from the divisi?ns. for reasons which appeared satisf~ctory .. I am Imunicipalities appeare? before the_ c~mi~nittee, _ because t~e quest10nmg now the Senator's amendment as It applies, for emergency had not ariSen. It is only within the last few 1932 CONGRESSIONAL RECORD-SENATE 2139 days that municipal bankers have taken the position they that the health department can be operated in such a way now take. I suppose the fact is they have not much money. as to make money. They can not believe that the charity They are afraid to use their limited liquid assets for this par hospitals should return money. They do not intend, of ticular purpose. If that is true, the municipalities must course, that the police shall charge for their services, or have help. the fire department. What they mean is that there must We can not afford to stop our relief work in the cities, be an increased fare charged upon the traction lines in New close our schools, and do away with our hospitals and wel York City. fare work. That can not be done. If Senators disregard Senators, that is our problem. Other cities have other entirely the distress of the country-and I assume that they problems. The. city of Boston, according to a telegram put do not, but if they do-it is either because they are blind into the RECORD by my able friend the Senator from Mas or because they have not gone where these people are who sachusetts [Mr. WALSH], says they can not raise the money are suffering. between collections of taxes in order that they may pay I tell you, Senators, not in my lifetime have I seen any their running expenses. thing like what is happening now in my city and other parts Mr. WALSH of Massachusetts. Between now and Oc of my State. We have 75 breadlines in New York, where, tober. among others," white collar" people are going to get food. Mr. COPELAND. Between now and October. They need I had a letter two days ago from a man who had been a short-term credit. That undoubtedly is true of every city, treasurer of one of the great tire companies. He is out of and probably of every State. work. He lost his position because of retrenchment. He I do not know the conditions in the State of California. was involved in the crash in Wall Street and lost his posses Since it is "the Golden State," they may roll in gold there. sions. He has been forced to take his two daughters out of They roll in beauty and luxury and delightful climate and school because he has not the money to buy their clothing. en.j oy the poinsettias and the other flowers and singing birds We want $20,000,000 in New York for home relief, for feed and luscious fruits. ing the people. We included $32,000,000 in our budget last Mr. SHORTRIDGE. Mr. President, a great many fine fall for welfare and hospital administration; but after rais people from New York have gone to California. A great ing $20,000,000 from private sources in New York, we found many of your splendid people have located permanently in that amount to be inadequate. Forty per cent of that money California. is already spent; so the city of New York appropriated Mr. COPELAND. We send a good many of our citizens to $20,000,000, in the hope and expectation that they would Hollywood, I know. have no trouble in getting the money on short-term notes Mr. TYDINGS. Mr. President-- until it could be provided for in the next budget or the next The VICE PRESIDENT. Does the Senator from New levY; but we can not get the money. We have $32,000,000 York yield to the Senator from Maryland? due Wednesday, day after to-morrow; and if Senators have Mr. COPELAND. I do. read the New York news at all, they know that until late last Mr. TYDINGS. I appreciate the problem of the city of night the bankers and the city officials were in conference New York; but it occurs to me that practically every city over this matter. The mayor and his associates have found and town, no matter what its size may be, is somewhat in ways of materially reducing the expenditures, but it is sig the same situation as the city of New York. While I might nificant that the Herald Tribune this morning-which cer be inclined in an isolated instance to support the proposi tainly is not a Tammany paper-says: tion to help New York City, it does seem to me that if this thing is once started every city in the country will want It is recognized that the continuation of the 5-cent fare is in some of it; and I am wondering where the money is going to separable from the question , of revising the city finances. An increase in the subway fare presumably would strengthen the come from. · city's credit, though it would first make a fortune for ·the holders I think the city of New York probably can make a of traction securities. stronger case than most cities as to justice and credit and I can not speak for any other community or any other everything else; but there are cities in every state of the section, but I know as well as one can know, from observing Union that are in the same boat, and I do not know where the trend of things and reading the news, that there is a we ~are going to get the money to take care of all these deliberate move being made in my city to force the raising things. of the fares in the subways. This is the plan, in order that In line with my usual philosophy in matters of this kind, the traction lines, privately owned, may share in the benefits I should like to see New York City make its appeal to the of a 10-cent fare and that their securities may be sold at a Legislature and the Governor of New York State, and if it is higher rate, as they are already being sold at a higher rate unable to raise the money otherwise to. have a special ses on the hope of it. sion of its legislature and to let the city borrow from the I do not have to imagine that. All we have to do is to State. When we go into the business of lending money here read the letter which these bankers wrote and gave out on and there all over the country, with all due respect to our the lOth, in which they say: friend from New York, we are getting out into a field of government that is too far flung in a country like this to be Mayor Walker and his associates undoubtedly realize that New handled either economically or efficiently. York City, like the National Government and other large govern mental bodies and public corporations, must undertake measures While the case of New York City is a very strong one, and of strict economy, and, especially in these times, must proceed certainly appeals to the justice and fairness of every man, on a more restrained and orderly development of its construction I nevertheless feel that the departure from our normal ac programs. tivity is a very striking one and one that we should make I agree with every word of that. That should be the only after very, very careful consideration. attitude of every city and of every branch of Government. Mr. COPELAND. Mr. President, I have heard with great But the bankers did not stop there. They said: interest what the Senator has said. Then why do not the The city must make every effort, wherever possible, to trans 1·ailroads get their money in the normal way? Why do not form existing enterprises which to-day are not self-supporting the savings banks and trust companies, and the building into ones that carry themselves, and thus take a heavY burden and loan associations, and the insurance companies, and the off the city's budget. agricultural livestock credit corporations, and mortgage loan Certainly they did not mean that the schools must be companies get their money in the usual way? They are all operated in a way to bring in increased revenue. They cer provided for in the bill. tainly did not mean that tuition should be charged to the We are not living in a normal time or in the usual time. children who go to the schools. They certainly do not con- Of course, my friend is well fortified in opposing a matter of template that the system of education shall be operated in this kind; but how absurd it would be for the city of New a way to make money. They can not believe for a minute York to appeal to the State treasury when practically all the that the parks and playgrounds can make charges to those money in the state treasury, or 75 per cent of it, comes from who make use of them. They can not believe, I am sure, the city of New York! What an absurd thing it would be! 2140 CONGRESSIONAL RECORD-SENATE JANUARY 18 Mr. TYDINGS. Let me say to the Senator in answer to made to cities or to railroads or to iil.surance companies his question that I admit that there is a great deal of parity help those institutions further than to enable them to pay between the claims of New York and the claims ·or the rail their interest and other temporary demands and obliga roads; but let me ask him a question in another way, taking tions? In other words, how would a loan to a railroad his own ·question as its foundation. company enable that company to increase its revenue by Let us suppose that we give this assistance to the city of hauling more passengers and hauling more freight? How New York; and then let us suppose that we broaden it and would a loan to an insurance company help such company say, "We can not stop there." Why not lend -money to to collect its next year's premiums and to increase the every private business in this country which can give se number of its insurance policies? curity? And why stop there? Why not lend to every indi It occurs to me that this bill, if enacted, can only be a vidual in the country who can give the security? And by temporary expedient. It does not in any sense touch the the time we have put all the links in this chain, where is the root of the evil. Unless the railroads can have freight to security? It would be so widespread that there would not haul and passengers to haul they will be back here next year be any security left in the country. in a worse condition than that in which they now find them I agree that the Senator's proposition is in line with that selves. Unless the city of New: York can give its citizens which we have made to the railroads; but we have to draw employment so that they can earn money with which to pay the line somewhere. their taxes New York will be here next year in a worse con If I may make one concluding observation, I do not like dition than that in which she at this time finds herself. to vote for any of these bills. It is no pleasant task for me What is true with regard to the railroads and insurance to adopt the philosophy of any of the bills. I have had to companies and New York is likewise true of every city, every submerge every normal instinct and impulse I have to vote institution, and every individual in the country. Unless " yea " on them. The only way in which I can possibly jus something is done to reinvest the individual with buying tify that vote is that we are practically in a state of war; power there will remain a continuation of this depression, that conditions are extreme; and I have violated every prin resulting in bankruptcy not only for the citizen but likewise ciple in which I believe simply because I believe that more for the railroads, insurance companies, banks, cities, States, good than harm would come from the passage of this one and eventually the Federal Government itself. bill. Therefore, I have gone that far; but that does not Mr. COPELAND. Mr. President~ I agree with what the mean that I can favor the inclusion of cities and towns and Senator from Oklahoma has said. This bill is bound to be private concerns and even individuals. If we go that far, I a great disappointment. If we could, by offering these do not think the credit of the Federal Government will be securities to the people, coax out of hiding the hoarded worth anything, and we will defeat the very purpose for money, and put it back into circulation, that would be a fine which all of this legislation was originated. thing, but, as a matter of fact, these securities will have to Mr. COPELAND. Mr. President, we would not be in this be taken to the banks. So we sell $2,000,000,000 to the banks crisis now if good banking methods had been used. There in order to give back the same $2,000,000,000 to the banks, was an orgy of speculation on Wall Street, which was en and we will be just exactly where we are now, except that couraged by the Federal reserve system. Our people in in the transfer of the funds the temporary necessities of the New York, our superbankers, bought foreign securities and railroads and of the insurance companies will be taken care peddled them out, so far as they could, to their correspond of. Their short-term loans will be provided for and interest ent banks. They had their long fingers reaching everywhere will be paid, and that sort of thing; but so far as any general into that sort of stuff which they could peddle out, and now relief to the country is concerned, I think the Senator from they are caught. The European securities which they Oklahoma is entirely right. We have not started yet; we bought are not worth much; perhaps many of them are have not done one thing yet of the many that we will do worth nothing. Yet they used good money to purchase before this condition is over. We are not at the end of our them, and now they are so short of money that the ordi troubles by any means, and we do not solve many of them nary functions of the banks can not be performed. That is by the passage of this bill. But it does give this temporary what has happened. relief. It takes care of the. temporary symptoms, but does This is not an ordinary time. The Baltimore & Ohio not cure the disease by any means. Railroad, the Pennsylvania, and the New York Central, Mr. TYDINGS. Mr. President, will the Senator yield to these great systems, have broken down. Bankers have made me? a mess of the whole thing. Yet, when we want to carry Mr. COPELAND. I yield for a question. on our activities as a municipality we carry on our work Mr. TYDINGS. I want to say, in line with what I have of relief, our welfare work, and our other activities, we are just said, in order to make my position clear, that I can not told, " No; you can not do it." The same Senate, the same see any difference in principle between lending to the rail group, who are willing to vote $2,000,000,000 of Government roads and lending to the municipalities; but I do think it money for the relief of private institutions, private finan is a question of limitation. Certainly the Senator is on high cial institutions, certainly can not be unwilling to vote ground when he says, " Why should the municipalities not some money for the relief of public financial institutions. be entitled to borrow on as good security as that of the There is no use in arguing the question. railroads?" But I do feel that the line must be drawn Mr. THOMAS of Oklahoma. Mr. President, will the somewhere, and if we get into the field of municipal finance, Senator from New York yield for a question? there will not be enough money in the United States to run Mr. COPELAND. I yield. all these towns and villages. Mr. THOMAS of Oklahoma. I have just read the pend Mr. COPELAND. Mr. President, when the Senator from ing amendment, and if I interpret it correctly it places the Maryland gets through voting for bills for the relief of cities mentioned on a parity with railroads, insurance com private corporations-- panies, banks, and other institutions mentioned in the Mr. TYDINGS. I am through. original bill. Is that correct? Mr. COPELAND. Judging from what is before us that Mr. COPELAND. That is correct. we can see, we are on the verge of major distress. This is Mr. THOMAS of Oklahoma. The bill creates a corpora only a temporary measure for the relief of the immediate tion and provides funds to be loaned by the corporation to symptoms. railroads and others mentioned in the measure. Mr. TYDINGS. Of course, it is to be observed that the Mr. COPELAND. Except that I have placed a limit upon railroads and the national banks, and, to some extent, the the amount which could go to the cities, while the amount insurance companies, are regulated more or less by the Fed which can go to the private financial organizations is eral Government, and that is not true of the municipalities, unlimited. as a general rule. So that there j,s at least some more Mr. THOMAS of Oklahoma. If this bill should be en measure of logic in our extending credit to these quasi acted, and the money made available, how would the loans public institutions which run from one State to another, 1932 . CONGRESSIONAL RECORD-SENATE 2141 and are part of our national system, than there is in ex Mr. WALSH of Massachusetts. Mr. President, will the tending loans to a locality which has its own government, ·Senator yield to me again? and stands upon its own bottom. Therefore I do think that Mr. COPELAND. I yield. stretching the rubber band slightly in favor of the railroads Mr. WALSH of Massachusetts. May I have the atten would be one thing, but we would have to stretch it a great tion not only of the Senator from New York but of the deal further to take care of the municipalities. Senator from Connecticut? 1 Mr. THOMAS of Oklahoma. Mr. President, will the Sen I assume the members of the Committee on Banking and ator from New York yield to me again? Currency are opposed to the amendment of the Senator Mr. COPELAND. I yield. from New York. May I propose to the chairman of the Mr. THOMAS of Oklahoma. The Senator from New committee an amendment along the line of the amendment York is a great physician and surgeon. I am wondering I propose to submit in case the amendment offered by the whether this whole relief program could be compared to the Senator from New York shall be defeated? I hope the Sen giving of an anresthetic preparatory to a major operation. ator from Connecticut may be in a position to feel that he Mr. COPELAND. Doubtless the Senator is right. Mr. can accept this amendment. I will read 1t; it is very brief: President, we would not be here making these pleas if the The corporation- Federal reserve system had been operated a little better, as I see it. A great many of the assets of banks are called Referring to the corporation to be established by the "frozen credits," when, as a matter of fact, they are just pend1.'1.g measure- as good, so far as soundness and safety are concerned, as on such terms as it shall prescribe, shall give special considera tion to banks petitioning for loans secured by securities that are much of the stuff that is taken over to the Federal reserve. in the nature of tax-anticipatory loans to States and cities. If there had been greater liberality in the administration of the ruies and regulations of the reserve and a broadening All that that does is to say to the members of this board, of the base of discountable paper, the condition wouid be " If a bank comes to you with this class of loans, you ought different. I was much impressed by what the Senator from to give it special consideration, rather than a bank which Michigan [Mr. VANDENBERG] said in that direction the other comes with loans which relate only to securities issued by day. I hope that at some time his views will receive the railroads and by other financial organizations throughout serious consideration of Congress and that some constructive the country." improvement may be established. I ask the Senator from Connecticut whether he would not Mr. WALSH of Massachusetts. Mr. President-- accept such a proposal as that. The VICE PRESIDENT. Docs the Senator from New Mr. COPELAND. Just a moment. I am not going to York yield to the Senator from Massachusetts? assume, for the purpose of the argument, that my amend Mr. COPELAND. I yield. ment is going to be defeated. The purpose of the Senator's Mr. WALSH of Massachusetts. I think it ought to be amendment is exactly the same as that of mine. pointed out that the large cities of the country are the Mr. WALSH of Massachusetts. I will not press the sug largest borrowers in the country at the present time; that gestion now. the conditions which this bill seeks to remedy is that the Mr. COPELAND. All of the short-term securities we are banks have no money to lend. They have frozen assets, talking of under the terms of the amendment I have offered and this measure is seeking to provide a means of liquidat are an anticipation of the next tax measure. They are all ing the frozen assets of the banks. to be included, so what we ask are not permanent loans. Surely if that is the aim and object of this bill, we ought Mr. WALSH of Massachusetts. I thought the objection to go a step further and provide that these cities, which being made to the Senator's amendment, namely, that it must borrow money-not for new development, like rail invited the cities and towns and States to petition this cor roads and construction organizations, but in order to live poration for loans, and therefore that there would be a flood and exist and to carry on-ought to be taken care of when of such requests, and that all the money appropriated would we are attempting to loosen up the frozen assets of the be absorbed could be removed by calling attention in this country and attempting to make it possible for banks to amendment to the fact that this board ought to consider lend money. . especially loans made by banks to cities and towns. If, by the power of the Federal Government, the banks are The VICE PRESIDENT. The hour of 2 o'clock having going to be made free to lend money, let us ask that they arrived, the Chair lays before the Senate the unfinished lend money first of all to our great cities, which I repeat business, which will be stated. are the largest borrowers and most· w·gently in need of The CHIEF CLERK. The bill (H. R. 6660) making appro money for the carrying on of their activities and for their priations to supply urgent deficiencies in certain appro very existence. priations for the fiscal year ending June 30, 1932, and prior I hope the Senator will stress the fact that we are dealing fiscal years, to provide supplemental appropriations for the here with the need of funds in the banks and institutions of fiscal year ending June 30, 1932, and for other purposes. this country to be loaned to carry on business. All activities Mr. McNARY. 1\.fr. President, I wish to ask the Senator are suspended everywhere because no bank will lend any from Washington [Mr. JoNEs] if he will not be willing to money to anybody, and they have come to the Federal Gov lay aside temporarily the unfinished business in order that ernment and have said, "Loosen our frozen assets and we will have money to lend." When we comply with their we may proceed with the consideration of the business at request, why should we not say," Take care of these cities"? present before the Senate? Mr. COPELAND. Mr. President, it is perfectly-logical that Mr. JONES. Mr. President, I appreciate the importance we should. We know what the cities are doing with the of the bill now pending. I think it far more important money they get. They are hiring men to clean the streets, to act promptly on it than the present deficiency bill. I they are operating trucks, they are buying gasoline, they are am glad to accede to the request of the Senator from doing all the things which a private concern would do. Oregon. Mr. WALSH of Massachusetts. And taking care of the The VICE PRESIDENT. Is there objection to the request sick. of the Senator from Oregon to lay aside temporarily_the Mr. COPELAND. Taking care of the sick, and furnish unfinished business? The Chair hears none, and it is so ing food to those who are starving. Certainly it would seem ordered. to me wholly in line with the general purposes of the bill. Mr. WAGNER. Mr. President-- Nobody doubts that the securities of my city are gilt-edge The ·vrcE PRESIDENT. Does the Senator from New securities. They have always sold at a premium. The last York yield to his colleague? we sold, only a few months ago, went at a premium. They Mr. COPELAND. I yield. bear a high rate of interest, they are fine securiti~s. they are Mr. WAGNER. I recall when we had up for considera safe securities; and the bankers say so. In this letter of tion the Reconstruction Finance Corporation bill that the criticism, even, they speak about the value of the securities. senior Senator from Michigan [Mr. CouZENs] gave as the 2142 CONGRESSIONAL RECORD-SENATE JANUARY. 18 basis for his support o! that measure that the railroads of at stake. I know vital matters are at stake in my city. the country had their bonds held by insurance companies, The very care of the sick and distressed and similar ques by banks, by individuals, and by .estates for safe investment, tions are at stake. I am confident that if Senatozp were to and that if there was a iurther decline in the prices of investigate cbnditions in their own States they would find those bonds and the credit structure was not upheld in exactly the same state of affairs. I hope that the amend some way, there would be tremendous suffering by all hold"!" ment may be agreed to. ers of those securities. I want to ask whether the munici Mr. KING. Mr. President, will the Senator permit an pal bonds of the country are not distributed in about the inquiry? same way and held by about the same institutions as are The VICE PRESIDENT. Does the Senator from New railroad bonds? Trust estates are _permitted to invest in York yield to the Senator from Utah? them; savings banks are permitted to invest in them; indi Mr. COPELAND. I yield. viduals throughout the country are large holders of munici Mr. KING. I ask the Senator if the Empire State of New pal bonds. It would seem to me that the same reason exists York, with all of its wealth and resources and large popula for support of the prices of those securities as of the rail tion, is not able to extend its credit, if the municipality road securities. lacks credit, in order to meet what the Senator has described :Mr. COPELAND. The Senator is entirely correct. as an emergency? My own opinion is that the State of Mr. BRA'ITON. Mr. President-- New York and indeed the city of New York have or ought The VICE PRESIDENT. The Chair would like to state to have about as good credit now as the Federal Government that a Senator having the floor has the right to yield only in ~ew of the enormous demands which are being made for a question and not for a speech. The Chair has not en and the fact that we are soon to issue more than $2,000,- forced the rule heretofore as strictly as he should have done, 000,000 of Federal bonds, and when, with the prodigality but now reminds Senators of the rule, and hopes they will characterizing the Senate and the House, we will probably observe it without the necessity of it being again called to be called upon to issue $5,000,000,000 or $6,000,000,000 of their attention. bonds before adjournment. Mr. BRATTON. Mr. President, will the Senator yield, in Mr. COPELAND. Mr. President, let me say to my friend order that I may note the absence of a quorum? from Utah that of course the city of New York and the State The VICE PRESIDENT. Does the Senator from New of New York likewise have what should be abundant credit, York yield for that purpose? but the city of New York pays 75 per cent of the taxes of Mr. COPELAND. I do. New York State and the State of New York is, in spite of its The VICE PRESIDENT. The clerk will call the roll.· economical way of administering its affairs, now possessed The legislatjve clerk called the roll, and the following Sen of no surplus of funds. This is not a question of the credit ators answered to their names: of the city of New York or the State of New York, because Ashurst Dale Kendrick Shipstead all concerned, even the superbankers who are striving to Austin Dickinson Kefes Shortridge Balley Dill King Smith force us into a 10-cent street-car .fare, admit that the securi- Bankhead Fess La Follette smoot ties are good. Nobody denies that; but they will not let us Barbour Fletcher Logan Steiwer have the money. . :~;:am ~:~! ~~~~Aa.r ~:~~~Idaho If the Senator's own State of Utah should be in the posi- Blatne Glass McNary Thomas, Okla. tion of desiring short-term credits, that State could not get Borah Glenn Metca.l1 Townsend them because the superbankers have shut down on the use Bratton Goldsborough Morrison Trammell Brookhart Gore Moses Tydings · · of funds for this purpose. If we are going to use the money Bulkley Hale - Neely Vandenberg of our people to finance private corporations and private -:~:s =~on ~~~;;k ;:rc~~ institutions, it does seem to me we ought to have at least 10 capper Hastings Nye Walsh, Mass. per cent of the same credit extended to our public institu- Caraway Hatfield Oddie Walsh, Mont. tions. I am asking in my amendment for $200,000,000 to be Carey Hayden Patterson Waterman ll tt d t th t hi Connally Hebert Pittman watson a o e o a purpose, w ·ch is 10 per cent of the $2,000,- Coolldge Howell Reed Wheeler 000,000 proposed by the measure before us. Copeland Hull Robinson. Ark. White Mr. GORE. "Mr. President, the Senator from New York ~~~X: ~~~~:on ~:~n. Ind. says that if we will consult the cities of our own States we cutting Kea.n Sheppard will undoubtedly find them in the same petitioning mood as The VICE PRESIDENT. Eighty-nine Senators have an- he is in behalf of the city of New York. . I want to make a swered to their names. A quorum is present. · general reservation in behalf of the cities of Oklahoma, and Mr. COPELAND. Mr. President, I sha~ take probably not . in particular in behalf of the villages of Redbird and Bushy more than three or four ·minutes, because I kilow the ur- head. ·I want to enter them in this scheme, if it is to go gency of matters before the Senate and the importance of through. · acting upon them. But this is a matter, as I view it, of Mr. BLACK. Mr. President, I merely desire to state to interest to every Senator. Every State and every munici- the Senator from New York that while there have been no pality has an interest in the. legislation. petitions coming to me from Alabama the city of Birming- We are proposing to vote $2,000,000,000 of the people's ham has recently endeavored to sell half a million dollars' money for the support of private institutions. The ques- worth of bonds, and although the city's credit is beyond tion is, Are we willing in an emergency to permit our cities doubt good it has not succeeded, and the result has been and States· to have short-time credits, in many instances that hundreds of men will not be employed who otherwise between the periods of tax collection, which need to be taken would have been employed in my State. care of? The banks have refUsed to loan that money. In In addition to that, so far as I am concerned, I do not my city some interests are striving to force the city into think this amendment is based on sound governmental an increase of traction fares. In many communities and in policy. I think it is based on unsound governmental policy. some States, according to reportS, the municipal bankers I do not think it is right or according to our original con-· have shut down upon extending short-term credits. I know, eeption of government for the Federal Government· to lend as much as one can know anything, that there are going its credit to States or municipalities, but I am likewise of to be appeals made to Senators from every part of the coun- the opinion that it is far more unsound and far more out of try. Because I happened to introduce the amendment the line with the principles upon which this Government was other day I had a strong letter from the city manager of founded for. it to lend its credit and its money to private a city in Virginia and from others who have written com- banking institutions or other business enterprises. For that plaining of their inability to get short-time funds to. tide rea.Son I shall vote for this amendment, not because I be their cities over until tax collections are made. lieve it is right in principle but because I believe that it The matter has been presented to the Senate. It is ·for the comes nearer being right in principle than it does for the Senate to decide what it cares t~ do. I think a great d~al ~- Federal c;rove~~t. to l~nd its_ credit to priva~ , business 1932 CONGRESSIONAL RECORD-SENATE . 2143 enterprises. I ean see no just sound reason why the Mr. REED. The loan will be like the parting from Kath Government should lend its credit to a business group leen Mavourneen, "It may be for years, and it may be formed for the purposes of profit when they are in need and forever., The chances are that no sooner will New York not lend its credit to groups of people in municipalities and get the money than she will turn around and say tJ;lat States operating a business not based upon profit. " Uncle Shylock , ought not to ask for a return of the I simply desire to make this statement, in view of the fact money. We have seen that happen in the case of foreign that I intend to vote for the amendment, but I should not countries. When one government lends to another gov want the r~cord of my vote to be an indication that I favor ernment, that is what always happens; and the city of New the United States Government borrowing money from its York will not want to pay us back, and we will be called citizens and levying taxes upon its citizens .either to carry mean and detestable when we ask to have it paid back. I failing business enterprises or failing municipalities. do not want to see us get in that position again. The city Mr. REED. Mr. President, I do not mean to prolong the of New York has as broad taxing power as we have, and a debate for more than a moment. I do not see how any of little' bit broader, because it can lay direct taxes in a way us can explain to the rural populations of our States why that we can not. I am wholly unable to see why the city we are appropriating money that in part belongs to them of New York, with its great taxing power, does not adopt a to be devoted to paying for such things as subways operated sound system of finance and resort to its taxing power so as at less than cost, if that be the fact-and I know nothing to rehabilitate its credit. about the merits of that dispute-to paying for boulevards Mr. WAGNER. May I say to the Senator-- in big cities, to paying for municipal improvements of one The VICE PRESIDENT. Does the Senator from Penn sort or another, meritorious in themselves, if a city can sylvania yield further to the Senator from New York?- afford them, but certainly not to be built at the expense of Mr. REED. I yield. others than those who derive the benefit. How can we ex Mr. WAGNER. May I say to the Senator that the appro plain to the country people of your State, Mr. President", or priations for which the city of New York now seeks money mine why we are spending their money to pay for such were made as emergency appropriations to take care of the things as I have described? Will not they come back to us serious unemployment situation in New York? This money and say, "We have no subways; nobody is buying subways will merely be borrowed in anticipation of the collection of for us out here on the fan.p; we have no municipal boule taxes, and just as soon as those taxes shall be levied and col vards or municipal playgrounds; why should our money go lected the particular debt, whatever debt may be incurred, into such things? , will be repaid. It is a reflection upon the integrity of New Mr. WAGNER. Mr. President-- York for the Senator to suggest that the city of New York The VICE PRESIDENT. Does the Senator from Pennsyl would borrow money from a banking institution, an individ vania yield to the Senator from New York? ual, or the Government, and that at maturity it would not Mr. REED. I will yield in a moment. I know perfectly repay that debt. It never has defaulted in all its history well, Mr. President, that in my own State, the city of Phila in the payment of any indebtedness it has ever incurred; delphia is in similar difficulties, but the mayor there and his it never will; and I resent the suggestion made by the associates have set their faces firmly against expenditures Senator from Pennsylvania. beyond the municipal income and they are savagely. cutting Mr. REED. If the credit of New York is as good as all down expenses in every direction so as to rehabilitate the that, then I can not understand why, with more money in city's credit, and enable it to pay its own bills. That is what the banks of that city than in any other city on this earth, every city should do and what every State should do. it can not make a loan. While it may be tha,t we are giving a temporary respite Mr. WAGNER and Mr. TYDINGS addressed the Ohair. to some communities that can not pay their bills as they The VICE PRESIDENT. Does the Senator from Penn go without doing it at the expense of the credit of the United sylvania yield; and if so, to whom? States, if we add another $200,000,000, as this amendment Mr. REED. I yield first to the Senator from New York. · will do, to the amount of these Government-guaranteed de Mr. WAGNER. I think my colleague [Mr. ·coPELAND] bentures that will be sold, we are hurting the market for stated the reason as clearly as it can be stated-namely, that Federal bonds just that much more; we are making the Fed some of the New York bankers have taken advantage of the eral Government pay just that much more interest on all situation in the .effort to impose a policy upon New York the money it has got to borrow in order to pay the deficit, with reference to the operation of its subways. After all, we and little by little, straw by straw, we are going to break the are still a democratic form of government and the people of camel's back. New York have decided upon the policy that is to be ·pur Mr. WAGNER, Mr. DILL, and Mr. BLACK addressed the sued; and, as between the bankers' position and that of the Chair. people of New York I think that the public policy ought to The VICE PRESIDENT. Does the Senator from Pennsyl be pursued. That is the whole situation involved here, as vania yield; and if so, to whom? has been so clearly pointed out by my colleague. M:r. REED. I yield first to the Senator from New York. Mr. REED. I should like to suggest that the Senate of . Mr. WAGNER. Mr. President, I understood the Senator the United States is not the place to decide the merits of to say that the rural communities in different sections of that controversy. I have not any opinion on it one way· the country would be called upon to :pay for the operation or the other. of subways in the city of New York. Mr. WAGNER. Mr. President, we are not asking the Mr. REED. Of course-- Senate to decide that policy, but that is the difficulty in rvrr. WAGNER. Wait a moment, if I may finish my the way of securing funds that ought to be willingly pro sentence. · vided because of the credit basis of the city of New York. Mr. REED. Certainly. Mr. TYDINGS. Mr. President-- Mr. WAGNER. I want to say to the Senator that what is The VICE PRESIDENT. Does the Senator from Penn proposed is merely a loan, which is made by the municipality sylvania yield to the Senator from Maryland? and which at its maturity will absolutely be paid, because Mr. REED. I yield. New York City has never defaulted either in payment of Mr. TYDINGS. What I am about to suggest may have int rest or payment of its bonds at maturity or in the due been pointed out, Mr. President, but, if so, I have not heard· payments at any amortization period. This money would it. I have a copy of the amendment in my hand and it be borrowed, just as the city attempted to borrow from the provides that the corporation may make loans to a State or bankers in New York, and it is not proposed to call upon a city. any other community to pay a dollar of the expenses of the A great many of the counties of the United States are in city of New York. · corporated; they· are political entities; they issue bonds; Mr. REED. Provided the city of New York repays the they have their own county governments, and in a great loan. many cases are going through the same period of deflation Mr. WAGNER. It never has failed and it never will that the cities are going through. If this policy is to be 2144 CONGRESSIONAL-RECORD-SENATE JANUARY 18 adopted, should it not comprehend the whole United States? been misgoverned and that many abuses have crept into the Why confine it to a city or a -State? I live in an agri- management of their fiscal affairs. With that statement cultural county known as Harford County, Md. Thalfi some will agree; but who can say that banking institutions, col..lnty has issued bonds in order to build roads and erect railroads, and insurance companies have not been extrava schools. To-day it is very difficult, with tax collections gant and have not mismanaged their fiscal affairs as well? throughout the country such as they are, to obtain the Yet there is no blame attached to them so far as extending money with which to carry on our county government. Federal aid is concerned. Their past is to be forgotten.. Fortunately, my county is in pretty fu,ir shape, but suppose We must save them, regardless of their misdeed, from bank- it were not, why should it not have an equal right with ruptcy. , the cities to obtain a part of this money for the stabiliza- I am in accord with the Senator as to the desirability and tion of its government? the necessity of protecting from bankruptcy these institu- I may go farther and say that the Senator from Nebraska tions, not so much for the sake of the institutions themselves, [Mr. HowELL] the other day pointed out that the drought important as that is, but more so 'for the sake of the inno had afflicted large sections in the portion of the -country cent investors in these institutions and the innocent de where he lives. I imagine, that being the case, that there positors in the banks. So I am in accord with the Senator are many counties in northern Nebraska and in Nort:Q and in regard to the need for legislation that will help to make South Dakota and in parts of Iowa where the county gov- our basic financial ·institutions safer arid thereby prevent ernments are unable to secure sufficient money to carry further financial difficulties. on normal county functions. That being the case, why Mr. REED. Mr. President, will the Senator permit a qties- should they not be entitled to get their share of this money tion? the same as New York? The VICE PRESIDENT. Does the Senator from Massa- Mr. REED. That is equally true of school districts, 'poor chusetts yield to the Senator from Pennsylvania? districts, drainage districts, levy districts, and all other mu- Mr. WALSH of Massachusetts. I shall be glad to yield. nicipal or governmental organizations that have borrowing Mr. REED. It is true, is it not, that practically the and taxing power. Of course, this amendment is limited to entire population of the United States is either directly or states per se and cities. indirectly interested in the soundness of the bonds of the Mr. TYDINGS. May I interrupt the Senator long enough railway companies-that· is, either through bank deposits or to say that I am struck w1th the fact that Senators who rep- through the holding of insurance policies? resent primarily agricultural States would be willing to ex- Wrr. WALSH of Massachusetts. But not any more so than tend this credit to the industrial or urban States, so to speak, in the soundness of the securities of our cities and our and withhold it from the people of their States, who perhaps States.. The people of the United States do not want any need it fully as much? · city to go bankrupt, not because of its lack of credit but Mr. REED. That is exactly what they are doing; they are simply because bank funds are frozen, and there is no money to loan to it. doing worse than that; it is proposed to limit the amount Mr. REED. Ah! But, Mr. President, the only thing the of this appropriation to $200,000,000, and by the time we cities are faced with is the possibility of temporary embar- · · have finished rendering relief to the city of New York, the rassment, such as Chicago had. They are not going bank .. city of Chicago, and two or three other cities, there is not rupt in the sensP. that an individual might -go bankrupt. · going to be a penny left in the fund for most of the States Mr. WALSH of Massachusetts. Of course, if they can not of the Union. get temporary loans they will have to suspend operations; Mr. BLACK. Mr. President, will the Senat-or yield to me? they will have to close up their schools, close up their has .. · The VICE PRESIDENT. Does .the Senator from Penn- pitals, and give up their relief work. That is a form of sylvania yield to the Senator from Alabama? bankruptcy. Mr. REED. I yield to the Senator from Alabama. - Mr. REED. They have to postpone their payments tern .. Mr. BLACK. The Senator made one statement which, if porarily; yes. correct, would cause me to vote against this amendment. It Mr. WALSH of Massachusetts. Now, let me answer an is contrary to my idea of the amendment. I had understood other observation of the Senator from Pennsylvania and that the .amendment did not add $200,000,QOO to the appro- also the question raised by the Senator from Maryland [Mr. priation, but allocated $200,000,000 out of the amount to TYDINGS]. grant loans to municipalities and cities. Why do we not include rural communities in this bill? Mr. REED. That is precisely the fact. It allocates out For the very simple reason that rural communities can of the $2,000,000,000 to be raised by this corporation a maxi- borrow all the money they need. They require only small mum of $200,000,000 for municipal and State relief; and ob- sums of money. Their loans are small, and the banks can viously, if the balance of the need can be supplied with take care of them; but cities like New York and Philadel $1,800,000,000, it does_add $200,000,000 when it takes care of phia and Chicago and Detroit and Boston are very heavy the additional need. borrowers. The sums of money they require reach into the Mr. BLACK. I might state to the Senator that, so far. as millions, and their banks are frozen, and there is no money :rny own belief is concerned,_ when the Treasury door is for them. It is not because the cities are mismanaged or opened there is no likelihood that private business enter- unsound. It is not because they can not pay their debts. prise, which this bill is intended to _help, will not use the It is because these banks that we are relieving now can not entire $2,000,000,000; I have no anxiety on that score at all. give them the money. They have not the money. If it is I can not see, therefore, that the amendment would add a small loan to· a small city of a few thousand dollars, the $200,000,000 to the amount. I simply rose to state that if it banks can take care of that'; but, not knowing when a run did add $200,000,000 to it, I would vote against the amend- will come upon the banks, the bankers can not tie up hun ment; but if it does not, and it is merely a question of how dreds of millions of dollars of their funds in the obligations it shall be applied-~nd I think in both aspects it is equally of the great cities. · · pernicious, :' if not more so "-I shall vote for the amend- There is the difficulty. ·Am I not correct, I ask the Sena- ment and then content myself with voting against the entire tor from New ~ork? measure. Mr. COPELAND. The Senator is correct. ) Mr. WALSH of Massachusetts. Mr. President, I have Mr. WALSH of Massachusetts. We are not dealing here tried to follow the argument of the able Senator from Penn- with discrimination between small communities and large sylvania [Mr. REED]. As I understand his argument, it is communities. The small communities can get all they want. that ,Jle can consistently vote to tax the taxpayers of the No small town or city is troubled about ·getting money, be Federal Government for money to be used to protect from cause the banks have made and can make small loans. No bankruptcy railroads, insurance companies, and banks, but I bank in this country at this very -hour is willing, however, he can not vote money from the Federal Treasury to protect to tie up for six months hundreds of millions· of dollars. cities from bankruptcy. He further argues that cities have .There is -the situation and the difficulty. - 1932 CONGRESSIONAL RECORD-SENATE 2145 Mr. COPELAND. Mr. President, will the Senator yield? a single bond at any value. Think how that hit the Mr. wALSH of Massachusetts. I shall be glad to yield. banks !-and hitting the banks meant hitting the people. Mr. COPELAND. I should like to have the Senator from I have no brief for the railroads. If they can not stay Massachusetts ask the Senator from Pennsylvania how he solvent, and if their individual concerns were all that were could vote for $500,000,000 for the exportation of goods. I involved, I would say, " Let them take the consequences of was glad to do that. their own misfortune"; but we can not do that when the Mr. WALSH of Massachusetts. I did not hear the Sen whole population of the United States, be it in Montana or ator's question. in Pennsylvania or any other State, is vitally interested in Mr. COPELAND. We put in this bill a provision that the continued soundness of railway bonds, because all our export corporations may have their acceptances taken over banking system and all our life insurance and fire insurance by the Finance Corporation to the amount of $500,000,000. rests upon that as a foundation. We also .have mortgage corporations in the bill; but when I have no apology whatever to make for my vote, which it comes to municipalities and States in distress asking for is cast in favor of the preservation of the soundness of those money for a few months they can not be put in. bonds, if we can do it, and I think we can, by the bill that· Mr. WALSH of Massachusetts. I assume the Senator is under consideration. from Pennsylvania would say that he believes the export I thank the Senator from Massachusetts for his kindness· and mortgage corporations are entitled to relief because in yielding to me. they have been honestly managed. Mr. WHEELER. Mr. President-- Mr. COPELAND. I think they are, too. The VICE PRESIDENT. Does the Senator from Massa Mr. WALSH of Massachusetts. Because they have been chusetts further yield to the Senator from Montana? economically managed, because their distress is due to no Mr. WALSH of Massachusetts. I yield to the Senator fault of their own, because it is due to circumstances beyond from Montana. their control; while he attempts to argue that the distress Mr. WHEELER. With the Senator's permission, let me the Senator's city is passing through is due to misgovern say that there is not any more excuse for the Government's ment, due to extravagance, due to waste. Therefore, the loaning money to a railroad than there is for its loaning to Federal Government should not come to its aid; but it a State or a municipality. should come to the aid of every private institution in this I desire to call attention to the fact that I received a tele country, because their finances are honestly and efficiently gram from the Governor of my State asking me to assist in managed and because they are entitled to relief to save the getting through an amendment of this kind. I have heard business structure of the country from ruin. the Members of the Senate, particularly on the other side Mr. WHEELER. Mr. President, will the Senator yield? of the Chamber, denounce measures here as being socialistic, Mr. WALSH of Massachusetts. I yield to the Senator and so forth; but in this particular bill we are taking a step from Montana. which is absolutely putting taxation on some of the people Mr. WHEELER. I was deeply touched by the plea that for the purpose of raising money to be loaned to private in was made by the Senator from Pennsylvania for the rural dividuals. I say it can not be justified, and that there is population of the country; but I was wondering how he much more justification in loaning it to the States and to would square his plea for the rural population of the coun the municipalities of the country than there is in loaning try with the idea of loaning money to the railroads and it to the insurance companies and the great banking loaning money to the insurance companies and loaning interests of the country. money to the banks, which as a matter of fact have been · The Senator a moment ago said, as I understood him, to a large extent responsible for the condition in which we that there was all kinds of money in the great banks iri the find ourselves to-day. Apparently, the Senator from Penn city of New York. If that is true, they ought to be in a sylvania has overlooked that fact. position to loan the railroads of this country, which they Mr. WALSH of Massachusetts. I think the Senator from dominate and control through their banking system. If Pennsylvania has made that clear by stating that the rural they are loaded up with money, they ought to be willing to population have an interest in . everything that affects the loan money to the great insurance companies, because they Nation as a whole, while he thinks the amendment of the dominate and control the great insurance companies of the Senator from New York affects.only certain restricted locali-. country, as they likewise dominate practically every great ties, and that the rural population will not be benefited by industrial corporation in the country. But since they do any benefits that may come to those localities. dominate them, and since those banks are full of money, if Mr. REED. Mr. President, perhaps the Senator will what I understood the Senator to say is correct, they ought yield to me for a moment. to come to the rescue of the very institutions which they Mr. WALSH of Massachusetts. I shall be glad to yield to dominate and control, rather than corriing down here to the the Senator from Pennsylvania. Congress of the United States for assistance. After telling Mr. REED. If I may answer directly the Senator from us that we ought to go home and keep our · hands off their Montana, then I will say that my excuse for being interested business; after demanding, if you please, that we keep the in the rural parts of the country perhaps may be explained Government out of business, they ought not to come down by the fact that the rural population of Pennsylvania is here and beg at the door of Congres-s and say, " Please, please probably twenty-five times the size of the entire population give us some money, because we are in a position where we of the Senator's own State. Therefore, I have some reason have a lot of money, but we do not want to loan it to our t.o be interested in their welfare. own institutions, the ones that we dominate and control." I have stood around here now for two years, · and I have Mr. KEAN. Mr. President, will the Senator yield to me watched those country banks in Pennsylvania breaking. for one minute? Thank heaven, the movement seems to be checked at the Mr. WALSH of Massachusetts. I will yield for a question; moinent; but the reason why many of them have broken has but the Chair warned the Senate this morning about per been that the bonds in which their depositors' money was mitting speeches to be made by one Senator while another invested have so depreciated in value that the banks were was occupying the floor. no longer either liquid or solvent. Every little depositor, no Mr. KEAN. I merely desire to say to the Senator from matter how small his account may be, has been affected by Montana that every bond issued by the railroads, every that shrinkage in the bond market. rate made on the railroads, every wage paid by the railroads There was a time, a month or so ago, when not only had is controlled and dictated by the Interstate Commerce Com the quoted prices of bonds gone down very far, but the miSsiOn. Therefore, when bonds are issued by railroad bonds were unsalable. One day, I remember, about six companies, there is a certain responsibility on the part of weeks ago, two-thirds of the bond issues listed on the New the Government of the United States for the issuance of York Stock Exchange did not even have a bid price for those bonds. .· 2146 CONGRESSIONAL RECORD-- SENATE JANUARY 18 Mr. WALSH of Massachusetts. Mr. President, I want to -the several· States is of -supreme importance· to the public say just one word more about the attempt here to prejudice welfare. the rural districts of the country against the extension of It seems to me that if we are going as far as we must go ' any favors to cities, and then I want to close. and as far as we ought to go to release these frozen assets, we The rural districts of every State in this Union are greatly ought to expect that the banking institutions of the country dependent upon the cities; and were it necessary for the would give a helping hand by lending emergency money to pay rolls in the large cities of this country to suspend, the the cities and towns whose finances are upon a sound basis rural districts would be as much affected and as vitally and are unable to borrow through the regular banking interested as the cities themselves. channels. Mr. HARRIS. Mr. President, will the Senator yield? Mr. COUZENS. Mr. President, when we voted on this The VICE PRESIDENT. Does the Senator from Massa- amendment before, on January 11, the amendment was lost, chusetts yield to the Senator from Georgia? there being 45 votes in the negative to 28 in the affirmative, Mr. WALSH of Massachusetts. I yield to the Senator and just prior to the vote I submitted a telegram from the from Georgia. mayor of Detroit. I may say, in this connection, that De- Mr. HARRIS. The Senator from Massachusetts does not troit's mayor is a very brilliant young Democrat, and he is understand conditions in some of the agricultural States entirely out of sympathy with this amendment. He points like the one I in part represent, because some of the coun- out in his telegram, very briefly, that the municipalities, the ties, on account of bonds issued for good roads improve- political subdivisions themselves, should exert every effort to ment, have gotten into a worse condition in regard to their live within their means before they appeal to the Federal bonds and expenditures than even the cities. I desire to Government. ask the Senator from New York if he will not allow this bill There is no excuse, in my judgment, why Boston or New to be amended so as to include counties. York or Chicago, or any of the other municipalities which Mr. COPELAND. Mr. President, will the Senator yield? may be appealing to the Congress for help, can not so ar- Mr. WALSH of Massachusetts. I yield for a moment. range their affairs as to take care of their financial needs. Mr. COPELAND. Of course, I hesitate for one reason It is perfectly obvious to me that many of the taxpayers only to include the counties, and that is because there are of these very municipalities are not paying their taxes be various reclamation projects and drainage projects and cause of the economic depression. Some of them can riot others which might with propriety be put in the bill. If and some of them will not. But it is a notorious fact that in the Senator himself were to propose that amendment, I most of these municipalities the tax-collecting agencies are think I should vote for it; but I would rather not include it not exerting their efforts toward collecting the taxes. In at the moment. many cases politics interfere. In many cases municipal Mr. HARRIS. I will offer it at the proper time. authorities will not press the taxpayers to pay their taxes. Mr. COPELAND. Mr. President, may I ask one question Yet it is said that these loans are to be advanced to munici- of the Senator from Massachusetts? palities in lieu of tax anticipation. As a matter of fact, most Mr. WALSH of Massachusetts. Yes. of these needs are created by tax delinquencies, and not in 1\.fi'. COPELAND. Are we not standing off the dole by cases where taxes have already been laid. what we are doing? In my city the money that we want I want to point out also the specific language which the immediately is for the poor; and the localities have been mayor of Detroit uses. He says: called upon to take care of their poor. We are striving to I would oppose any legislation that would relieve municipal avoid the dole, but unless we take care of the localities, un governments from recourse to uncompromising economy in order less we take care of those who are unemployed, we will pass to bring expenditures of government within income. legislation calling for the dole before the session is over. That is _exactly what Detroit has done. Detroit has per Mr. WALSH of Massachusetts. The Senator correctly haps gone through worse economic distress than has any states the situation. other city in the Union. It has had the great centralization Mr. President, I want to conclude, but I desire to call at of the motor-car industry to contend with. Yet it has gone tention again to the fact that there is no question here through with it and has not pleaded for Government aid so about any of these loans being unsound and unsecured. far as its finances· are concerned. This bill provides that the members of the board shall pass It is true it believes, as I bel"eve, that the Federal Govern upon the security of all loans. If a city is bankrupt, if a ment should aid in the relief of the unemployed. I believe city is not balancing its budget, or if a State is not balancing that is a national problem. But when it comes to meeting its budget, no money can be loaned it unless the· members of deficits, when it comes to maintaining the extravagance of the board violate their oaths of office. The first sentence in many of these municipalities, it seems to me that they should section 5 is as follows: first disclose to what extent they have cut their budgets, to All loans under the foregoing provision shall be fully and ade what extent their back taxes have not been paid, and what -quately secured. efforts they have made to secure the taxes before appealing So, in asking that the cities and States be permitted to for Federal aid. borrow, we are not asking that the public treasury be raided. Mr. WAGNER. Mr. President, will the Senator yield The members of the board must say " These city and State to me? loans are secured. They will be paid. We can rely upon Mr. COUZENS. I yield. this money coming back into the public treasury. We are Mr. WAGNER. The city of New York is carrying a bur extending only emergency aid. den, at a tremendous expense, which the Senator a moment That disposes of any attempt to say that the money will ago says he regarded as a function of the Federal Govern never be paid, or that we will be lending money to bankrupt ment. The very controve1·sy which is now taking place be cities. tween the bankers in New York and the city administration I want every Senator here to understand just what the involves $20,000,000 which is being used for unemployment proposition is before we vote; at least how the Senator from relief, appropriations which the city of New York has made. New York or the Senator from Massachusetts may feel The question as to whether they are living within their about the matter. This bill is a measure seeking to tax the income is not involved in that item, because, as the Senator people of this countl·y to relieve the frozen assets in the banks well knows, in the administration of municipal affairs it of the country, to give the banks more money; to do what frequently happens that before the taxes are collected cer with the new money? To lend money to their favorite cus tain items of expenditures must be met, and in those in tomers, to lend money to insurance companies, to lend money stances--just as in the case of the Federal Government's to railroads, to lend money to speculators, to lend money to practice--short-term notes are issued, which are to be their favorite clients? How .can we, as representatives of paid when the taxes are collected. That is all that is in the people, refuse to say to these banks that they should have volved in the controversy now taking place in the city of in mind the lending of money to the municipalities and to New York. So it is not a question at all of living within our 1932 CONGRESSIONAL -RECORD-SENATE 2147 means. We are doing what is frequently done, but never Mr. COUZENS. The Senator can not expect the Federal before has the city had any difficulty in selling its short Government to take cognizance of the matter because term notes. there is a controversy about street-car fares. The Lord Mr. COUZENS. Mr. President, I do not think the city knows Detroit has had enough of those, and we never at would be in trouble now if it were to show a disposition to any time appealed to the Federal Government to come to curtail its expenses and live within its income. our aid in establishing street-car fares; and the Detroit In addition to that, I want to say to the Senator from street-car fare is among the lowest in the United States. New York-- Mr. WALSH of Massachusetts. Mr. President, will the Mr. WAGNER. Mr. President, will the Senator yield Senator yield? again? Mr. COUZENS. I yield. Mr. COUZENS. Just wait a moment until I :finish my Mr. WALSH of Massachusetts. May I inquire of the sentence. Senator whether these loans, the list of which he has read, Mr. WAGNER. There is no claim anywhere that the city were made after applications had been made to the banks is not living within its income. and the banks had refused to lend the money? Mr. COUZENS. I claim it. I claim that the city of New Mr. COUZENS. Yes; some of them were. York is not living Within its income, and I think the figures Mr. WALSH of Massachusetts. So that there was the will indicate that they are living beyond their income, be same situation as that existing in New York and Boston cause they should not need to borrow on tax anticitntions. and other cities; they found the banks unwilling to make They should be able to live within their income. loans to provide the money, and individuals came forward I want to say that Detroit, perhaps, was the leading city and took up the notes of the cities? last year, 1931, up to July 1, in appropriating money for the Mr. COUZENS. That is true of a few; but I want to be care of the unemployed. perfectly fair and say that the banks in some cases had Mr. COPELAND. Mr. President, will the Senator yield? reached the legal limit of their loans to one institution. · Mr. COUZENS. The city was vigorously condemned for Mr. WALSH of Massachusetts. I want to ask the Sena initiating a policy of assuming the responsibility of caring tor another question. Is it true in the Senator's State that for its unemployed. This year it went into the new fiscal the cities and towns borrow money in anticipation of taxes year with a falling off in taxes, that is, not anticipated taxes, every year, prosperous years and hard-time years? but delinquent taxes, in the amount of some $30,000,000. · Mr. COUZENS. No; it is not. Mr. COPELAND. Mr. President-- Mr. WALSH of Massachusetts. In many of the States of Mr. COUZENS. Yet it provided for taking care of its the Union, including New York State and my own State, the unemployed, for taking care of its finances, and even to 1st day of January every year every city and every town the extent of going to some of its wealthy institutions and borrows money in anticipation of the taxes they will receive concerns in order to secure aid. I find no evidence submit the following September and October. It is not to make up ted here that the citizens of New York or of Boston think any deficit, it is not because they are bankrupt, it is not enough of their municipalities to come forward and help because the taxpayers have not paid their taxes, but they them out in their financial difficulties. borrow money to carry on the municipalities for the six For just a moment I want to refer to what Detroit has months before the taxes are to be paid in. That is the done in the way of having its citizens come to the aid of the custom one year after the other; it has gone on since time city, so that it does not have to come to the Federal Gov immemorial. This year, because of the frozen assets of the ernment on hands and knees begging the Federal Govern banks, these larger cities can not get the money loaned to ment to come to its assistance. For example, the Detroit them which has been loaned every other year without any Edison Co., a public utility, loaned the city $2,000,000. The question. Guardian Detroit Bank loaned the city $1,260,000. The Mr. COUZENS. Mr. President, will the Senator please Bankers Trust Co. of New York, because of our fine finan tell us why these New York bankers lend the city of Detroit cial standing, loaned the city $7,500,000; the Ford Motor Co., money when they will not lend their home city money? $5,000,000; the Detroit Trust Co., $500,000; the Packard The New York bankers, at this very time, have been lending Motor Car Co., $500,000; the Bankers Trust Co. of New York, the city of Detroit because the city of Detroit has reduced again, $3,900,000; the Burroughs Adding Machine Co., $200,- its expenditures and operating expenses, and is living within 000; the General Motors Corporation, $800,000; the Chrysler its means. Motor Co., $300,000; the People's Wayne County Bank, $4,- Mr. WALSH of Massachusetts. I noticed the amount was 000,000; the Detroit City Sinking Fund, $12,025,000; the First a small sum of money. National Bank, $3,000,000; and the National Bank of Com Mr. COUZENS. For what? merce, $1,000,000. Mr. WALSH of Massachusetts. The amount the new York I could go on enumerating other financial institutions banks loaned. which have come to the assistance of Detroit because of the Mr. COUZENS. Oh, no. fine municipal management in that city. Mr. WALSH of Massachusetts. How much was it? Mr. COPELAND. Mr. President, I observe that almost Mr. COUZENS. The Bankers Trust Co. of New York at all those millions came from banks. one time, in December, loaned us $7,500,000; again, in De Mr. COUZENS. Oh, no! cember, $1,600,000; again in December, $2,300,000. So that Mr. COPELAND. Almost all of them; just a few from it is a question of not meeting the conditions necessary for individuals. But let the Senator not forget that the philan securing a loaq. I venture to say that if the city of New thropic citizens of our city gave $20,000,000 just a few York and the city of Boston were to show a disposition to weeks ago. live within their means, the bankers would take care of them. Mr. COUZENS. Oh, the Senator's statement is beside the Mr. WALSH of Massachusetts and Mr. COPELAND ad point, because I am not referring to money that is given dressed the Chair. for the care of the poor at all. I have not mentioned a The VICE PRESIDENT. Does the Senator from Michigan single one of those cases. I am referring to money that was yield; and if so, to whom? advanced to the municipal government of Detroit to pre Mr. COUZENS. I will yield first to the Senator from vent a default in the performance of its municipal New York. activities. 1.1.-:Lr. COPELAND. What was the bank to which the Sen Mr. COPELAND. A large share of it came from banks, ator referred? Was it the Guaranty Trust Co.? and the Senator's city is fortunate in that they have the :Mr. COUZENS. The Bankers Trust Co. of New York was credit; but in spite of the fact. that New York City has one. higher municipal credit than any other city, we can not Mr. COPELAND. I want to answer the Senator, if I may. get a dollar from the banks, because they want to increase The Senator has spoker. of a particular institution, the the street-car fares. That is what they are trying to do. Bankers Trust Co. of New York. I have no more grievance LXXV--136 2148 CONGRESSIONAL RECORD-SENATE JANUARY 18 against that institution than I have against any other. The here and break down all the home-rule principle and all the Bankers Trust Co. is one of the group of superbankers who State-rights principle to which Democrats so strongly adhere. are trying to do the thing I have mentioned to the Senator Mr. WAGNER. This is an abnormal situation, and all we about our traction rates. That is the reason why they will are asking is that there be another place where we may let Detroit have money and will not let us have it. They are go to borrow our money upon good security. The mere es-· playing politics with human misery, and in the present sit tablishment of that other source, wherever it may be, will uation are trying to squeeze us and force us into an unwill be sufficient to enable us to secure our money. ing act. That is the answer. Mr. COUZENS. I would be ashamed to come here from Mr. COUZENS. When the municipal authorities of New the great city of Detroit and urge and beg my colleagues York City show evidence of a willingness and desire to reduce to come to its financial assistance. expenses and live within their income, I have no doubt they Mr. COPELAND. Mr. President-- will get from the .bankers of New York the money that they The VICE PRESIDENT. Does the Senator from Michigan· want. · yield to the senior Senator from New York? Mr. WAGNER. Mr. President-- Mr. COUZENS. I yield. The VICE PRESIDENT. Does the Senator from Michigan Mr. COPELAND. I can well understand the 'attitude of yield to the junior Senator from New York? the Senator. He knows the importance of great care in Mr. COUZENS. I yield. municipal government. But I want to recall to his atten Mr. WAGNER. May I ask what rate of interest the city tion what these bankers actually said. This is a statement of Detroit paid for this loan? over their own names. Among other things, they were insist Mr. COUZENS. I do not have the figures, but it was less ing upon economy, but in addition, they said: than 6 per cent. The city must make every effort to transform enterprises which Mr. WAGNER. May I say on the question as to whether to-day are not self-supporting into ones that carry themselves. or not the bankers are apprehensive whether New York is That is a reference to the subways. The subways, as I living within its income, that only a year ago this same set tried to explain a week ago, were built by the city, and in of bankers for a similar loan, not for the same purpose, but and of themselves are profitable. They are operated, how a short-time loan in anticipation of the collection of taxes, ever, by the Interborough and Brooklyn Rapid Transit loaned a large sum of money-! am quite sure it was over Cos., part of the companies which own the surface lines $50,000,000-at the lowest rate ever given to a municipality, and the elevated. Those lines do not pay. These operators to wit, 1% per cent. That was only a year ago. There is are not willing to have a fare which is very profitable in very little difference between the budget of last year and the subways continued that way, because they want to make this year. That is clear evidence that it is not a question of money enough there to carry their dead horses. It is be the credit of the city of New York, but merely, as my col cause these securities are held by the great banking con league [Mr. CoPELAND] said, that this opportunity is being cerns that the superbankers are taking advantage of this used to impose a certain policy which the banks would like occasion to choke the city and squeeze the city into acqui to have the municipality follow with reference to the opera escence in their plans. tion of the subways. Mr. COUZENS. Does the Senator intend me to infer from Mr. COUZENS. I am not impressed with that argument that that we should involve ourselves in local disputes be at all, because we can raise any sort of a bogey man as tween municipalities and their utilities? a reason for the bankers declining what we believe to be a · Mr. COPELAND. Are we not involving ourselves in the proper loan. They are pursuing this practice, not only in question of whether the railroads have been properly run the· city of New York but in the city of Detroit, wher~ we or not, and whether the mortgage companies have been have no street-car fare controversy at all. They refused to properly run or not? They are provided for in the bill. loan us money until we balanced our budget. We have provided $500,000,000 in the bill for the export Mr. WAGNER. What I tried to make clear was that the corporation. We did not inquire into the operation of that other loan, which was made at the rate of 1% per cent, was organization. made less than a year ago. So far as the operation of the Mr. COUZENS. I beg the Senator's pardon. We have municipality is concerned there has been no change since not provided for $500,000,000 in the bill for the export cor that time. poration and do not propose to lend any money to the Mr. COUZENS. I want to point out to Senators that con export corppration at all. ditions have been getting worse ever since. In all probabil Going back to the railroads, I want to point out, as I have ity a year ago there were not so many delinquent taxes and repeatedly stated on the floor of the Senate, that, so far as conditions were not as bad as they are to-day. Does the I can recall, the Banking and Currency Committee did not Senator believe that conditions a year ago were not better provide for the railroads primarily because of the railroads than they are to-day? themselves but to sustain the insurance companies who own Mr. WAGNER. A year ago the municipality met all of railroad bonds and who have billions of dollars' worth of its obligations. policies among our ·citizens, and it was deemed unwise, as Mr. COUZENS. Yes; and this year it can not do so. it seemed to us, to destroy the confidence of the people in . Mr. WAGNER. It collected taxes and paid for the ad life insurance; and further because billions of those bonds ministration of its government. It is going to do the same are in the hands of savings banks and we did not want· to thing this year as it has done it every year. The money break them down and, perhaps, cause runs on the savings which it is seeking to borrow, as my colleague and I have banks. reiterated time and time again, is merely in anticipation of Mr. COPELAND. I agree fully with the Senator in that the collection of taxes. They are going to collect the taxes desire. to meet the obligations, as they have done every year since Mr. COUZENS. It was not for the railroads and it was the city began as a government. not for the banks themselves that they were mentioned in Mr. COUZENS. Does the Senator from New York mean the bill. They were mentioned in the bill because of the . to imply by that statement that the citizens of New York, dependency of these organizations and not because the or outside of the bankers themselves, have not sufficient confi ganizations had lived beyond their means or had been un dence in the New York city administration to come forward duly extravagant or unwise in their expenditures. Every and help them out? bit of evidence that we received was to the effect that the Mr. WAGNER. That has not been attempted by the city railroads have been economizing to the limit. When the of New York. There is no doubt that the city of New York municipalities can demonstrate that they have economized will get its money to operate its government. and still that they can not further exist or can not run their Mr. COUZENS. If that is true, then the Senator and his water works or their lighting plants without help, then I colleague should not come to the Federal Government until think it will be time for the municipalities to call upon as a last resort, because they certainly do not want to come Congress for help. 1932 CONGRESSIONAL RECORD-SENATE 2149 Mr. COPELAND. It is very pressing dpon us when day I wonder if the Senator from Connecticut, who has charge after to-morrow, on Wednesday, we have $32,000,000 worth of the bill, would not accept that as an amendment to of securities coming due and we have not the funds to meet section 15? the payment. Mr. WALCOT!'. Mr. President, there is a difference be- Mr. COUZENS. The Senator's good citizens ought to tween section 15 of the Senate bill and section 15 of the come forward and helP" the nmnicipality in a situation of House bill. Instead of section 15 as found in the Senate that kind. bill a new section is inserted, which, in part, is as follows: Mr. COPELAND. TheY. are not all able to contribute SEC. 15. The corporation shall make and publish a report quar- $1,000,000 apiece. terly of its operations to the Congress stating the aggregate loans Mr. WAGNER. Mr. President-- made to each of the classes of borrowers provided for and the The VICE PRESIDENT. Does the Senator from Michl- number of borrowers by States in each class. gan yield to the junior Senator from New York? It does not require the names of the borrowers to be Mr. COUZENS. I yield. reported. It is believed that there would be an element of Mr. WAGNER. Did I understand the Senator to say that danger in reporting the names of the borrowers in a .transac the city of Detroit is appealing to the Federal Government tion of this kind, and when the bill goes to conference I for aid in taking care of the unemployment situation in am inclined to believe that the provision for the names of that city? the borrowers to be reported will be stricken out. Mr. COUZENS. The mayor of the city of Detroit has ap- Mr. WHEELER. I did not ask the Senator that the peared before the Committee on Manufactures, presided names of the borrowers be put in, although I am inclined to over by the Senator from Wisconsin [Mr. LA FoLLETTE], and urged a general appropriation for the care of the un- believe that in instances of this kind we should have them, employed of the United States. He was making no special because I do not know any reason in the world why when appeal for Detroit. He was not asking the United States the Government of the United States is loaning the people's money the Congress of the United States should not know Government to support its credit or provide help in the way to whom the money is being loaned~ I do not know any of funds for its banks or individuals. Mr. WAGNER. The Senator has not quite answered my reason why the good people of this country, for whom pleas question. Does the city of Detroit expect to have some of have been made upon the floor of the Senate, should not these funds allocated to it so it may help those who are in know and could not be trusted with knowing to whom loans distress? are made. Mr. COUZENS. Certainly, if that bill is passed; and I It may be argued that if that were done, it might hurt the favor the bill. credit of the borrowers, but I am assuming, Mr. President, Mr. WAGNER. The city of New York has asked for no that none of the money that will be loaned in this instance such relief. We are taking care of that situation out of is going to be loaned to private individuals; it is going to be our own treasury. loaned to railroad corporations, to trust companies, and-to Mr. COUZENS. I do not knoyv about that. we in De- mortgage companies, to corporations of that kind and troit are taking care of that matter out of our own treasury, character. Congress ought to know and the people ought to. too; and we are not asking for any support of our own know to whom the money is loaned. They ought to know treasury. Detroit is taking care of itself, and we are taking ·the kind of · securities on which the money is loaned. In care of our unemployed. · addition to that, they ought also to know the rate of interest Mr. HARRIS. Mr. Presicient, I desire to amend the that is charged. amendment by inserting the word "county" after the word We are sitting here in the United States Senate as a. board u State," so as to have the language refer to States, cotin- of directors practically for the United States Government. ties, and cities. _ What board of directors would allow the president of some The VICE PRESIDENT. Let the amendment be stated subsidiary company to loan the money of the company and for the information of the Senate. not report to the board of directors the amount of the The LEGISLATIVE CLERK. The Senator from Georgia pro- money he was loaning, to whom he was loaning it, the kind poses to amend the amendment by inserting after the word of security he was getting, and the name of the borrower? "State" the word" county," so as to read: Mr. WALCOTT. Mr. President, if a bank which may be Within the foregoing limitations of this section, the corpora- in serious trouble has. that fact published, is it not going tion may also make loans to a State, county, or city to aid in to encourage a run on that bank? temporary financing- Mr. WHEELER. Not at all; I think it would be quite the And so forth. contrary. If the people know that that bank has applied to Mr. WHEELER. With reference to section 15, I want to the Government of the United States and is going to be able ask the Senator from Connecticut [Mr. WALCOTT] a question. to borrow some money, I do not think that knowledge would I notice it provides that- cause a run on that bank at all. I do not think that is any The corporation shall make and publish a report quarterly of answer to the question. Here we are sitting as a board of · its operations to the Congress stating the aggregate loans made directors of the Government of the United States, and we to eaeh of the classes of borrowers. are going to pass a bill in which we say we can not trust In view of the fact that we are giving the board such ourselves to ~ow to whom we are making loans, the kind wide power, I think we ought to go further and ask the of security required, or .the rate of interest charged, but that board to make a report not only of the aggregate loans made we are going to turn over to some corporation the authority to each of the classes of borrowers but likewise we ought to and power to make these loans and not require the corpora ask them to report the kind and character of securities tion to make a report setting forth those facts. which they are taking for the loans, together with the rate The VICE PRESIDENT. The question is on agreeing to of interest that is being paid. Otherwise the report they a1·e the amendment proposed by the Senator from Georgia [Mr. going to make to Congress will be practically valueless. HARRIS] to the amendment of the Senator from New York We are proposing to tum over to the board $2,000,000,000~ [Mr. CoPELAND]. The only report we are asking them to make to Congress is Mr. HARRIS. I want to say this: Unless this bill shall be as to the aggregate loans made to each of the classes of amended in reference to loans to the cities, the largest cities borrowers. We are giving them almost unlimited power. of the country will get all of the amount appropriated. We ought to know not only the aggregate amount of the There are 2,500 counties in this country, and many of them loans they have made but we ought to know the kind of are in as much financial d~tress on account of bonds issued securities they are taking when they loan this money, and for schools and roads as are any of the cities. For that in addition we ought to know the rate of interest that is reason I hope my amendment to include counties in the being charged. benefits to be derived from this measure will be agreed to. 2150 CONGRESSIONAL RECORD-SENATE JANUARY 18 · The VICE PRESIDENT. The question is on agreeing to upon this amendment, I refrain from voting. If permitted the amendment proposed by the Senator from Georgia to to vote, I should vote " nay." the amendment of the Senator from New York. [Putting Mr. HATFIELD 2158 - CONGRESSIONAL RECORD-SENATE JANUARY 18 in impm-tance with each passing year. If we do not propose Mr. KENDRICK. Does not the Senator believe that if to train these men properly and efficiently, then we should this Nation had been better prepared at the beginning o! not keep them in reserve, and we should not hold them the last war, we would have been paying out millions less subject to call. now than the adjusted certificates amount to? I agree with a good deal the Senator from Virginia has Mr. REED. Yes, Mr. President; if we had spent a little said about the waste of money in the air mail service. _ It more in making our forces fit in 1914 and 1915, we would seems to me entirely unnecessary for the Government to never have been in the last war at all. The expenditure of subsidize an air mail route running parallel to a railroad $400,000,000, let us say, in adequate armament and training with hourly train service, and there are many other op in those years would have saved us the expenditure of $40,- portunities to economize in connection with our air forces. 000,000,000 in the prosecution of the World War. We But in view of the military preparations and the expendi would never have been dragged into it if we had been pre tures of every other nation to keep up the air forces to pared, and every penny we pay now in keeping up our mili the last word in efficiency I again insist that we should tary efficiency is an insurance premium against being either abandon our air forces entirely or train them dragged into somebody else's war in the near future. properly. I hope we will not economize in this respect. ' As one Member of the Senate I · am Unwilling to reduce Mr. GLENN. Mr. President, of course I am unpressed the appropriations below what they ought to be, at the with the necessity for maintaining the national defense. I expense of the safety of the men who participate in the think there is very little, if any, difference of opinion in this fiying. Chamber concerning that necessity. I am ·also impressed N"rr. DICKINSON. · Mr. President, will the Senator yield with the idea that a Nation which is unsound and bankrupt to me? financially is not in very good position to wage a successful Mr. KENDRICK. I yield. war in defense of its territory. Mr. DICKINSON. I want to suggest to the Senator from I have just returned from one of the richest States in this Wyoming that the war records, as I recall it, show that great Union-from Tilinois and from Chicago. I found there some of our most efficient pilots in the war came out of a story of financial tragedy ahd despair, and a feeling among the commercial ranks rather than out of the reserve forces the people that is not conducive to national defense. You which we had at that time. know the story as well as I, perhaps. I want to tell ·the Mr. KENDRICK. The Senator would not -claim that Senate that the people of Tilinois, and I think of every other would apply as a rule in every line, would he? State· in this Union, are demanding that we keep America Mr. DICKINSON. I think it does. I think that some solvent in these times, for one reason and another, not the of the best pilots we have are the all-weather pilots who least of which is that if war comes, we will be a sound and are in the air force, and I also want to suggest that the solvent nation. _ question of whether we have a thousand men flying 39 When the Government officials having to do with the sub minutes or 71 minutes is not decisive in the m2.tter of a re ject of the amendment have gone out and expended the duction in the air force at the present, because we have money appropriated for this purpose so early in the fiscal the Regular Army, and we have all the other training .,go year and come now for deficiency appropriations, I predict ing on, in addition to the flyers included in this force. that this is an action which will be repeated as to every item Mr. KENDRICK. Mr. President, in any line of endeavor, of every appropriation bill, with the whole country and every as everyone knows, increased training and increased dis taxpayer demanding economy and reduction in expenditures. cipline are of tremendous importance. This applies par All over the United States we hear that cry getting louder and ticularly to the Air Ser.vice, surrounded., as it is, by all the louder every day, yet in the Halls of Congress, when an effort hazards of that service. is made for economy to meet this great national emergency-' Mr. REED. Mr. President, I agree with all that has just because it is nothing else--to keep our Government's securi been said by the distinguished Senator from Wyoming [Mr. ties sound, to keep our fiscal condition solvent, we will find KENDRICK], and I hope the amendment offered by the Sena one group or another, honest and patriotic men, saying," We tor from Iowa [Mr. DICKINSON] will be successful. are for economy; we believe in economy, but upon this par The VICE PRESIDENT. That amendment has been ticular item we must increase the estimate; instead of agreed to. economizing and reducing we must increase it." On every Mr. REED. Then. I hope the amendment as amended by item of every appropriation bill, almost, we will find that sit the Senator from Iowa will be agreed to. uation. Sound and able people, in one Hall of Congress and The Senator from Wisconsin is right when he says that the other, are going to 1be here with their pet projects and 70 per cent of all this Government pays out is spent for -the ideas in which they believe; and when the fight is all past wars or for preparation for future wars. The shocking over, then the .mork of all the Government authorities hav thing about it is that a very large proportion of that amount ing to do with the Budget and our fiscal affarrs is over. After represents expenditures to the veterans of past wars which the House has voted and the Senate has voted, and the con would not have been incurred had we been properly pre ference has voted, we will find, I fear, that the terrible finan pared. That has nothing to do with preparedness for future cial situatfon of the country, instead of being relieved and wars; it has nothing to do with maintaining the efficiency remedied by the Congress, will have been made more des of our flying forces. perate and more deplorable. We are considering an appropriation of $100,000 to be I plead with this body in the interest of every man and spent in maintaining the training of reserve officers who are woman in the United States, because nearly all of them are qualified for combat service in pursuit ships, not for wad thinking alike these days. They are demanding of us strict dling through the air in cargo planes or transport planes, and drastic I;!Conomy, that we not increase, but that we cur but for the very highest degree of skilled piloting known in tail expenditures so that they can meet their tax bills, so aviation. that the Governments-National, State, and municipal-may While we ~re haggling over $100,000 for that purpose we continue to operate. We must pay heed to them, and we will have lying on our desk a Treasury statement which shows take the soundest step we can take in the interest of national that so far in this fiscal year we have spent two thousand defense if we reduce these expenditures. times as much on the adjusted-service certificate fund, that There is almost an insurrection going on, almost an uprising we have spent, actually paid out, during the last 12 months, against the growing and growing taxes in this land. Thou ten thousand times as much for loans on bonus certificates sands and thousands of school-teachers are unpaid in the to veterans of the last war. second city of the United States, schools closed in the richest Mr. KENDRICK. Mr. President, will the Senator yield suburbs of Chicago; policemen, firemen, and all the things to me?· which go for the people's protection and the comfort of our Mr. REED. I yield. people unprovided for. Not only is this true in Chicago but • 1932 CONGRESSIONAL RECORD-SENATE 2159 Detroit is coming to that, Philadelphia coming to it, New I appeared to present without argument at all the recom York coming to it, as related and argued by the able Sena mendations of a committee of the Federal Government ·au tors from that State upon this floor. thorized at the last session of this body. I did not say any What is going to happen unless some steps are taken thing either for the recommendations or ·against them; pretty soon in this Congress to stop this expenditure of pub When that world's fair bill comes before this body, this lic moneys? Can a bankrupt nation defend its territory in body can do exactly as it pleases with it. case of war? I say no. I ·say it is more essential that we Mr. HARRIS. Would the Senator from illinois object if set an example now, early in this session-set an example we should decrease that appropriation of more than upon this item, that the Senate of the United States, recog $1,000,000 which they want for the Chicago world's fair? nizing the dire extremities of this situation, is determined Mr. GLENN. I will not object to this body doing exactly that we will keep the National Treasury sound. Let us vote as this body sees _fit to do. against this deficiency item and let us vote to curtail bureaus Mr. HARRIS. This body will do that anyway, but I am and commissions and activities of the Federal Government asking the Senator if he will object if we try to reduce the all along the line. Let us set an example to every State in appropriation so as to economize in this great crisis about this great Nation, every one of which has been extravagant which the Senator has been talking. in its appropriations and in the burdens which it has placed Mr. GLENN. We will meet that situation when it arises. upon the shoulders of the taxpayers. Mr. HARRIS. I am asking the Senator what he would The VICE PRESIDENT. Under the rule the Senator has do if we should try to reduce the appropriation for which no right to refer to a State in that way. he is asking? Mr. GLENN. I withdraw the statement thus publicly Mr. GLENN. I will make no objection. I will leave it made as to the States, but my thoughts are the same as entirely to this body, and if they see fit to reduce it a before the rule was invoked. million dollars or more, then there will be no objection on Mr. President, a parliamentary inquiry. Is there any pro my part. vision of the rule against referring to municipalities? Mr. HARRIS. Will the Senator vote to reduce it? The VICE PRESIDENT. The rule is against referring to Mr. GLENN. I do not know yet what the proposition is. a State. The Senator will proceed in order. When it is . before the Senate I shall vote upon it, but I Mr. GLENN. Let us set an example to every county in will not vote as some Senators do, without knowing for every State of the Union, to every city in every county in what they are voting. every State in the Union. To all those people who have fol Mr. HARRIS. Here is an appropriation of $100,000 for lowed the extravagances of the National Congress let us lay national defense, while the world's fair item to which I down a rule of strict economy that will radiate from Wash have referred was for $1,700,000. The Senator can certainly ington to every part of this great Nation, and we will soon say 'Whether he will vote to reduce that appropriation. have a respect for the Congress which we do not have now, Does he want to economize or does he not? a respect for the financial sense of the Congress which we The VICE PRESIDENT. The question is on agreeing to do not have now. We will set an example which will be the amendment as amended. [Putting the question.] The welcomed all over the country and which will be in the noes seem to have it. interest of the national defense. Mr. REED. Let us have the yeas and nays. The yeas and nays were ordered. Mr. HARRIS. Mr. President, the last time I heard the Mr. BLACK. Mr. President, may we have the amendment Senator from Illinois talk, he was just as eloquent in asking read as amended? for a l~rge appropriation for the Chicago world's fair. I The VICE PRESIDENT. The clerk will read the amend think it is probably one hundred times more important to the ment as amended. country that we should make this appropriation than that we The LEGISLATIVE CLERK. On page 30, after line 12, insert should spend $1,000,000 or more for the world's fair. The the fallowing: Senator talks about" pet projects," and what the Appropria ORGANIZED RESERVES tions Committee should do to all of them. It is just such pet For an additional amount for expenses incident to the use, in projects as the Senator presented to the committee the other cluding upkeep and depreciation costs of supplies, equipment, and day for the world's fair that cause a great deal of extrava material furnished in accordance with law from stocks under the gance, more than anything else. ontrol of the War Department, fiscal year 1932, $100,000: Pro vided, That this sum shall be used for expenses incident to the I have no criticism of people who differ with me about fiight training of officers of the Officers' Reserve Corps on inactive preparedness. I know the horrors of war. It came home duty status: Provided further, That no part of this sum shall be to me more closely than it did to most people. I have voted available for any expense incident to giving fiight training to any officer of the Officers' Reserve Corps unless he shall be found physi for every measure that I felt would prevent war. I voted cally and professionally qualified to perform aviation service as an for disarmament conferences, and will continue to do so. aviation combat pilot of group 1 by such agency as the Secretary But as long as we do not agree with other countries to dis of War may designate. arm, I shall feel it my duty to try to have our country pre Mr. BLACK. Mr. President, a parliamentary inquiry. pared, so as to save the lives of our American boys if we The VICE PRESIDENT. The Senator will state it. should have to go to war again. I think we ought to thank Mr. BLACK. Are we to understand that we are now · the boys in the Organized Reserves. We owe them a debt of voting on the amendment of the Senator from Iowa to the gratitude, and we ought to thank them ins~ead of criticizing amendment? this little amount of money for-them. These young men are The VICE PRESIDENT. That amendment was agreed to. willing to give their lives to their country if necessary. For The question is on agreeing to the committee amendment these and other reasons I shall support the amendment. as amended by the amendment of the Senator from Iowa. Mr. GLENN. Mr. President, referring to the statement The yeas and nays having been ordered, the clerk will call made by the Senator from Georgia about an eloquent speech the roll. of mine, which I supposedly made fo:r the world's fair, I The legislative clerk proceeded to call the roll. do not recall that I ever made any speech for the world's Mr. FLETCHER John P. Hoffman, Dallas. MESSAGE FROM THE SENATE Neill S. Green, Dunn. A message from the Senate, by Mr. Craven, its principal Laurence T. Gibson, Gibson. clerk, announced that the Senate had passed bills and a join Coy s. Lewis, Hemp. resolution of the following titles, in which the concurrence of Edith E. Holton, Jamestown. the House is requested: William R. Stephens, Leaksville. S.1089. An act to establish a minimum area for a Shenan Mary W. Yarborough, Louisburg. doah National Park, for administration, protection, and gen George E. Hunsucker, Maiden. eral development, by the National Park Service, and for other Blanche H. Edwards, Newport. purposes; Raymond C. Edwards, Pomona. S. 2407. An act to authorize the sale of parts of a cemetery Evelyn Hill, Snow Hill. reserve made for the Kiowa, Comanche, and Apache Indians John C. Matthews, Spring Hope. in Oklahoma; and Lucy B. Hofler, Sunbury. S. J. Res. 37. Joint resolution providing for the filling of George H. Wright, jr., Wendell. vacancies in the board of regents of the Smithsonian Institu Ina L. Jordan, Winton. tion, of the class other than Members of Congress. RHODE ISLAND The message also announced that the Vice President had Lillian G. Hoxie, Shannock. appointed Mr. REED and Mr. FLETCHER members of the joint VIRGINIA select committee on the part of the Senate as provided for in the act of February 16, 1889, as amended by the act of March John Q. Blackburn, Amelia C. H. 2, 1895, entitled "An act to authorize and provide for the dis Charles B. Graves, Chester. position of useless papers in the executive departments," for Robert J. Blackburn, Endless Caverns. the disposition of useless papers in the War Department. John 0. Hawkins, McGaheysville. · EXTENSION OF REMf..RKS Lawrence C. Page, Norfolk. Mary R. Piggott, P.J,Jrrellville. Mr. DICKINSON. Mr. Speaker, I ask unanimous consent Berkeley Williams, Richmond. to extend my remarks in the REcoRD by printing a speech of Walter H. Oakey, Salem. ex-Senator James A. Reed, at a Jackson Day dinner, at Alfred L. Benson, Tangier. Springfield, Mo. Mr. UNDERHILL. Mr. Speaker, reserving the right to ob WISCONSIN ject, it seems to me this is hardly within the lines laid down Jerry J. Jerabek, Algoma. for insertion of matters in the RECORD. I must object, Mr. Emmery A. Greunke, Appleton. Speaker. John F. Lambert, Crandon. THE RIGHT OF A DELEGATE TO VOTE IN COMMITTEE Edward C. Szyperski, Cudahy. Mr. Otto E. Born, Fond du Lac. HOWARD. Mr. Speaker, I ask permission to address Benjamin 0. Wall, Holmen. the House for one minute. William C. Curry, Kiel. The SPEAKER. Is there objection to the request of the Anton Schiesl, Laona. gentleman from Nebraska? Ethel F. Pilgrim, Menomonee Falls. There was no objection. Grace A. Johnson, Merrimack. Mr. HOWARD. Mr. Speaker, at a recent meeting of the Edith S. Bartlett, Nashotah. Committee on Indian Affairs, a committee was appointed to Peter D. Harris, Oneida. investigate the question of whether or not a Delegate in this Louis J. Bettinger, Plain. House had the right to vote in committee. The committee, Alma Colt, Poy Sippi. with Judge LooFBOUROW as chairman, made an exhaustive Charles F. Ninman, Sauk City. study of the question and submitted to the Committee on LeRoy H. Ardern, Springbrook. Indian Affairs a report. I am sure it will be interesting to Russell E. Burlingame, Statesan. all the Members of the House, and I desire now to offer this Louis C. Currier, Stoughton. report as part and in addition to my remarks of the moment. LeRoy Winters, Twin Lakes. The SPEAKER. The gentleman from Neprask~ asks Ralph W. Lathrop, Wauzeka. unanimous consent to extend his remarks at this point as Sam Dewar, Westfield. indicated. Is there objection? There was no objection. The matter referred to follows: HOUSE OF REPRESEN~ATIVES Hon. EDGAR HowARD, Chairman Indian Affairs Committee of the MONDAY, JANUARY 18, 1932 House of Representatives: At the meeting of this committee on January 5, 1932, the The House met at 12 o'clock noon. chairman propounded the following- question and asked the sub The Chaplain, Rev. James Shera Montgomery, D. D., committee on rules to examine and report upon the same, to wit: offered the following prayer: " Whether or not a Delegate from a Territory of the United States, regularly assigned to the Committee on Indian Affairs of Bless, 0 God, the Memb&-s and officers of this CongresS, the House, should be accorded a vote in the committee?" who are working so zealously for· the good of our country; Upon this question your subcommittee on rules makes the following report-- · rule over all conferences and deliberations for the further " The Constitution of the United States, Article I, section 2, ance of Thine own purpose. We pray that all our citizens provides that: may live upright obedient lives and that morality and intelli "The House of Representatives shall be composed of Members chosen every second year by the people of the several States," and gence may prevail. Do Thou make Thy bounties universal in the same sectj.on that "no person shall be a Representative and hasten the day when all jealousies shall cease which who shall not have attained the age of 25 years and been seven have separated nations so long and those angry passions years a citizen of the United States, and who shall not, when which have dashed one upon another. Quench the spirit of elected, be an inhabitant of that State in which he shall be chosen." the lower feelings and may the teachings of the Master dwell Nowhere in the Constitution is mentioned an office such as with all mankind. 0 help the old weary and torn world "Delegate to Congress." until its tears shall cease, its groans shall end, and it begins From the foregoing provisions it is plain that only Representa tives elected from a State can be Members of the House of to sing in the morning light. In the name of our Savior. Representatives. Amen. The Constitution, Article IV, section 3, provides that: "The Congress shall have power to dispose of and make all needful The Journal of the proceedings of Friday, January 15, 1932, rules and regulations respecting the Territory or other property was read and approved. belonging to the United States." LXXV--137 /
CONGRESSIONAL RECORD-SENATE 2125 Aus Tin Couzens Hull Pittman the VICE PRESIDENT
