1st Session No. 140 RURAL BANKING AND CURRENCY REFORM AN ADDRESS DELIVERED AT LAKE TOXAWAY, NORTH BY CHARLES HALL DAVIS OF PETERSBURG, VA. 響 PRESENTED BY MR. FLETCHER JULY 24, 1913.-Ordered to be printed S D-63-1-vol 21-27 WASHINGTON RURAL BANKING AND CURRENCY REFORM. Mr. PRESIDENT, GENTLEMEN OF THE SOUTH CAROLINA BANKERS ASSOCIATION, LADIES AND GENTLEMEN: Three great questions are today receiving the careful consideration of the American peopletariff reform, currency reform, and rural banking. I have named them in the order of their relative importance in the eyes of the people. If I were personally asked to name them in the order of their importance to our national prosperity, I am by no means sure that I would not reverse the order. Certainly rural banking would not come last. Tariff reform is almost an accomplished fact. Currency reform is being actively and seriously discussed by a Democratic Congress, pledged to its passage. Rural banking is just commencing to attract general notice in this country, and to be recognized as a national issue. There may be, and in my judgment there is, an interdependence between rural banking and the legislation which is now being considered by Congress under the popular designation of currency reform. This interdependence seems to have escaped the attention of most of our representatives, and of the great body of our people. To me it seems a most important matter, and one worthy of careful consideration. I have therefore selected as my subject to-day "Rural banking and currency reform"; and it is my purpose to present for your consideration the relation between these two questions. I shall attempt to show you that they are closely connected and should be simultaneously considered by our National Congress; and that any attempt to settle our financial difficulties by the passage of a socalled currency bill will inevitably fail to accomplish the desired end, unless, at the same time, the necessary legislation is passed to establish a system of agricultural banking. In presenting this phase of the rural banking problem it is not my purpose to discuss at any great length the provisions of the so-called currency bill or Federal reserve act now pending before a Democratic Congress. Necessarily some reference to the same must be made. It would be practically impossible to discuss the relation and interdependence of two proposed legislative acts without some reference to and discussion of the provisions of those acts. I must comment on and criticize those provisions of the Federal reserve act which, in my judgment, weaken it as an effective force for the purposes to be accomplished. But, in making such comments, I recognize that the pending bill has been prepared under the direction of men who have given to the subject exhaustive study, and to whom many sources of information, to which I have no access, are available. In discussing the question I shall also endeavor to deal with it absolutely independently of political views or tenets; for in a matter of this importance, touching every phase of our daily life, the questions at issue should be considered purely on their merits, and without reference to their possible effect on any political party. As a matter of fact, I think it may be safely stated, as a general rule, that trouble usually results from any mixture of politics and money. Moreover, in considering this question of rural banking and currency reform, it is perhaps just to both of the great political parties to say that, in my judgment, the Aldrich bill, representing the Republican plan, and the Federal reserve act, representing the Democratic plan, are equally subject to criticism in this connection, in that neither of them makes any adequate provisions for the farmers' banking requirements, and in that the authors of neither of these bills seem to have recognized that no adequate reform along the lines proposed can be accomplished by any bill which fails to provide for our agricultural needs. To me it is astounding that, in preparing and presenting such a legislative act, its patrons, as well as the public, should have apparently overlooked the vital fact that the banking necessities of onethird of our population have been disregarded, and that no provision has been made in either of these bills for the peculiar class of banking needed by the agricultural classes. Possibly this has resulted from the fact that both of these proposed bills have been popularly referred to and regarded as bills for แ currency reform." The prominence given to one of the purposes of this legislation, and the absolute necessity of reform in our currency, has diverted attention from the fact that the bill has really a much broader scope than its popular designation would indicate. I venture to say that even among my audience to-day, composed of experts in banking and kindred subjects, there are some who have failed to appreciate the full scope of this proposed legislation; who have thought of it simply as a bill for currency reform; and who are even now speculating as to what possible connection can exist between a plan for rural banking and an act to reform our circulating medium. Probably the greatest asset of any political party in a national campaign is the adoption of a popular and high-sounding slogan or rallying cry, as presumably representing its views and its attitude on the questions submitted for the consideration of the people. Frequently, under our system of government, political parties rise or fall according to the efficacy of their slogan; for this slogan is usually accepted by the rank and file as being a concentrated statement of the aims of the party adopting it; and the opposition is assumed to be actuated by a desire to antagonize the ideals and purposes for which this slogan stands. Only too frequently the war cry of the successful party could be with equal force adopted by the opposition; and often the fundamental ideas for which it stands would be approved by all the individuals of both of the contesting elements, if considered in cold blood. A political slogan often brings into prominence a side issue, and by appealing to the under lying principles of right and justice implanted in the heart of every man secures converts to the party whose slogan it is, the real purposes and real issues being beclouded by this battle cry. In the discussion of all popular questions, therefore, it has always seemed to me wise to diseregard the political phrase maker and these pretendedly descriptive phrases, to attempt to find the real issue, and to ascertain its real purpose and scope before joining in the public outcry in supposed support of or antagonism to some fundamental principle of right or wrong. Possibly within the recollection of some of my hearers a campaign involving the fundamental, constitutional right of a State to secede from the Union, which it had entered into under a written agreement, was settled by an appeal to the inborn abhorrence of every Anglo-Saxon to the abstract conception of human slavery. The designation of the two great political parties of that day and time as "proslavery" and "antislavery," with the consequent impression on the minds of the people that human slavery was the issue, resulted in the settlement of a legal and constitutional question of a State's right to secede by four years of bloody and costly war, instead of by calm argument and dispassionate judgment. Within my own recollection I recall, in the national campaign of 1896, the adoption by the Republican Party of the slogan of "sound money," and the arguments by which a man, who said he wanted. sound money, was convinced that thereby he had committed himself to the tenets of the Republican Party. I am one of the few Democrats (out of the several million who voted in that campaign for the free coinage of silver at 16 to 1) who admits that he so voted and who has no apologies or concealments to make. Apparently most of the remaining millions who so voted, like the privates in the Confederate Army, who have all been promoted to colonelcies, have disappeared or been "converted "-God save the mark-into "soundmoney" advocates. The efficacy of the "sound-money" slogan has not yet been lost. And yet, on a reasonable and fair consideration of the subject, would any man be so unjust as to state that the millions of advocates of the free coinage of silver at 16 to 1 were knowingly advocating the adoption of "unsound money"? Were they less patriotic, less intelligent, less interested in the proper solution of this question? Do you not agree with me that both parties favored a "sound money "; that both parties were opposed to "unsound money"? The real difference was a difference of judgment as to how we could best secure a sound currency system. The individual in each party was equally honest and earnest in his belief that the methods proposed by his party were the proper methods to be pursued in order to obtain the "sound money " which both equally desired. A man may be a convert to the idea that the single gold standard is best; but to admit that he is a convert to "sound money" is an admission that he advocated "unsound money," and he who knowingly advocated "unsound money" for our country was but a poor patriot. I have elaborated this point at some length, because, in my opinion, the danger of being misled by such a descriptive phrase is an everpresent danger, and because I am convinced that in the consideration of bills for so-called currency reform just such a misleading phrase or descriptive title has been used. Thereby the attention of both people |