masters of the art. They were working up step by step in monopoly making.

When the railroads were practically in their hands the next proposition came up, "How about the great industrial resources of this country? There is our field." I was in New York when Roosevelt had the suit filed against the Northern Securities Co. Men came out of the stock exchange there and talked to me. One said, "My God, Daniel, look at that fool in the White House. Look at the market; it has gone to the devil. From now on we will use all our efforts to throw him out." I said, "It is a very remarkable thing that you have become so entirely obtuse on the question of right and wrong that when the President of the United States, under his oath of office, executes the law, intelligent and educated men stand around here and begin to use expressions that are absolutely unjustifiable." That shows the temper of the New York men, members of the stock exchange, so-called respectable men in business.

I mention the following as a great and conspicuous example: When the United States Steel Corporation was formed the biggest industrial corporation in the world-they created $700,000,000 out of nothing. I will show how this thing is worked by a jugglery proc ess. As soon as that corporation was put on its start Morgan, through the machinery of the banks, allotted stock to those banks that they should sell. As a matter of fact, those banks were paid 5 per cent commission for selling that stock, and they are under obligations to these big reserve banks in New York until they would practically lend their moral support to the sale of these fictitious tokens of debt. I know of instances where, for instance, a man would be on the street and would be approached by a bank officer, who would say, "I know a good thing; you ought to buy some of it." The man would say, "Well, what is it?" "You ought to take United States Steel common." He would say, "I haven't any money." The answer would be, "That does not make any difference. We will loan you the money to buy it." Just as soon as you can borrow money on anything that is collateral it gives it a market value at once in New York City and other financial centers.

To make this germane to the work of the committee I will take up a simple illustration. When I was with Teft, Weller & Co., and we saw a woolen manufacturer put a mortgage on his business, the buyer in our department would say, "Well, Daniel, I guess that party is handicapped. He has to pay a fixed charge on his mortgage, and he can not make goods as cheap as So-and-so." If that man a little later put a second mortgage on his property, he was put on the books practically as unavailable. He could not meet the competition of the manufacturer who was out of debt. If the Steel Corporation had intended to be public benefactors and distribute their products reasonably to the trade, the last thing on God's earth they would have done would have been to place a bonded mortgage of $475,266,500 on the plants they combined, and $400,000,000 of preferred 7 per cent cumulative stock and $550,000,000 of common stock. In other words, they put a fixed interest charge on their business of $79,162,500 a year, to be added to the price of steel and iron before it reached the consumer in this country. Any man of commercial experience and hard common sense knows that this trust can not stand competition, and they know it, and they are coming

down here and asking the Government of the United States to throw around them its protection. "Save me, Cassius, or I sink." That is what it means. As a simple American citizen, I oppose statements I see constantly in prints. The facts are not known.

This is too big a subject for a man to make any personal allusion, but I would like to say that I was very much amused when I was sitting here listening to the testimony of Judge Gary, and the impossible attempt to get a direct responsive answer on any given proposition for a whole day; and he is a principal witness on the other side. It recalls to me a hearing before the Ways and Means Committee of the House of Representatives. Mr. Andrew Carnegie went before that committee and testified that the steel business needed no protection, and after delivering himself very positively on that subject Mr. Payne referred to the testimony of Judge Gary. Mr. Carnegie was in Europe when Judge Gary gave his testimony. Mr. Payne read the testimony where Judge Gary said it was not only necessary but it was proper, and the tariff ought not only to be retained, but, if anything, increased. He asked Mr. Carnegie, "What have you to say after hearing the testimony of Judge Gary?" Mr. Carnegie replied, "Well, Judge Gary, of course, I know well. He has been identified in business with me, and he is a well-equipped man, a good lawyer, and a man of great resources. But we would say in the old country he is a 'paukie chiel.'" The committee wanted an explanation. "Well," he said, "a paukie chiel' is a man who knows on which side his bread is buttered, and needs watching."

I would like to go into this subject to show that the object of every trust in this country is to manufacture debts on the industrial resources of this country. Those men do not go into the business to make money out of the industry itself. As I was talking to them. over in New York when they were promoting them, a fellow approached me and said: "Well, Daniel, I want you to go into this proposition. We are going to issue $2,000,000 of stock." I said, To whom are you going to sell it?" "Anybody who will buy it." I said, "How will they ever get their money back?" He said, "That is none of our business. You don't want to go down into the mine, into the ground; but you want to sell the stock. The profit on the stock is absolutely satisfactory." That is a clear idea of how a large per cent of about $30,000,000,000 of tokens of wealth have been floated in this country.

Now, an economic proposition comes in here. The greatest burden labor has to bear is the interest on debts. The people in this country were fooled for a great many years by the tariff. They did not think it was a tax. It was an indirect thing; it did not come to them directly. These financiers work the same system. In other words, when you mortgage the steel business the consumer pays the fixed charges. If, for instance, I want to go into the steel business on one side of the street, and I had acquired my money, had accumulated it, and gone in business in the proper manner, I would go into the countinghouse and ask my bookkeeper, "What have we to get for steel rails?" He would immediately proceed to get the pay roll showing the amount of labor, and that would mean the legitimate running expenses of the business that he would give me. I would say, "Put 10 per cent on that, and there is my profit." But when the steel manufacturer goes out of business and the promoter, the manufacturer of the debts, comes in his place, you have a different situation.

You go into the office and say, "Well, now, what does it cost me to manufacture steel rails?" He says, "The fixed charges on our first mortgage bonds are so much, the dividends on our preferred stock are so much, and we have to pay 5 per cent on our common stock." After all those fixed charges are first put down, then you get down to the legitimate expenses of the business. Now, can you tell me that a business that is bearing those burdens can compete with a man who is legitimately the owner of his business, or that the producer on the outside can be furnished the product at a reasonable price by the overbonded enterprise? I contend that he can not.

Now, as to the remedy. You can not build up a trust in the United States anywhere without money or credit. There never would have been a trust in the United States if the banking machinery of this country had not cooperated with the promoter of the trust. He could not have floated his securities; he could not have gotten the money to build up such a tremendous business. Teft, Weller & Co. did a business of $15,000,000. They had a line of credit of so many million dollars at the banks. The banks did a legitimate business in this case, and after you reached this point they said, "That is enough. Begin to pay off." With a legitimate banking system in this country you could not have any trusts. On the other hand, it does not make any difference how many laws you put on the statute books of the United States. No man can come to compete with these corporations if you once give the stamp of this Government, which is practically part of its sovereignty, as a trade-mark to do business on. It will be impossible for one seeking to engage in a like business to borrow a million dollars in New York City, because a man who knows anything about the conditions in New York City knows that the clearing-house banks absolutely control the loaning of money in the city of New York. As an evidence of the changed conditions of business which progress has brought about in the way of combination and the use of modern inventions, a very interesting little narrative was told by Mr. Perkins to this committee. "A man went out and used the telephone to one part of the United States, and in a short while he went back and consummated a big deal." He did not tell you about the fellow who had a legitimate enterprise on hand who went to New York and tried to get some money to finance it, and as soon as he put in his application for his loan it was telephoned to the clearing house, and in less than two minutes he could not get a dollar. It gets back to the same old thing. I have studied it for 30 years. I have no personal interest in it on God's earth, but old Rothschild laid it down, and I want this committee to test everything by that maxim, "Let us control the money of a country, and we care not who makes its laws." Financiers who represent those English houses know that proposition-know it well-and the only way on the face of the earth you can keep those combinations from dominating, not only the business of this country, but, to a great extent, the Government, is to cut them off from the money supply. It is not their money, and you can not build up a trust, and there has not been a trust built in the United States, without an improper use of other people's

money.

I know I was in New York when they started the flotation of the Amalgamated Copper proposition. It was known all over Wall

Street, and around there, that you could borrow so much on Amalgamated Copper stock. Nobody had any of it then, but they began to look for it. It was such a good thing that the National City Bank and other institutions were offering to lend money on it. People thought they had better get some of it, and, as a matter of fact, by increasing the amount of money they proposed to lend on it; they floated the whole proposition as fast as they could deliver it. I believe a great deal of delay is occasioned by trying to regulate the business of 95,000,000 people and the internal commerce of a great country like this, amounting to about $30,000,000,000, by law. I have for 20 years watched the evolution of the Sherman antitrust law. As soon as I read it I said, "The law is all right; there is nothing the matter with it." But the same crowd who were building up this condition chloroformed the powers that be, and it was never executed. They never expected Roosevelt to become President. As a matter of fact, he never would have gotten there but for the death of McKinley. But when he got there he found this law. He is a fighter by nature, and he jumped right into the middle of it.

I contend that the great trouble in our country is this, that we pay three and a half million dollars to be represented in Congress, we pay over one hundred and some odd thousand dollars to judges of the Supreme Court of the United States, and when those representatives in Congress pass a law for the peoples' protection it is handed up to these other employees of the people, viz: The judges of the Supreme Court of the United States who by their decision nullify the will of Congress. The President of the United States has said, in his message to Congress, "the judges of the courts are very reluctant to put men of such respectability in jail." What is this Republic coming to? Is it to be understood that there is any man in this Republic who is beyond the reach of the law? It is not a question of law; the fundamental trouble is for these judges to clearly distinguish between what is right and what is wrong, and this moral obliquity goes from the lowest courts to the highest to-day in the United States. But the man who knows the methods of the financiers of this country, led by Pierpont Morgan, who is a past master in manufacturing debts, and who knew exactly what he was doing, knows that no responsible, careful association of men would have intrusted the safety of their established steel businesses and turned such powers over to J. Pierpont Morgan & Co., as were given in the contract published as by the Bureau of Corporations, unless there existed a private understanding between them in the formation of the United States Steel Trust, that beyond the price paid for their plants they were to participate in the overcapitalization of the United States Steel Corporation. The contract referred to gave him carte blanche to do anything he wanted, without any risk attending it. Now, gentlemen, I am coming to the point I am interested in. I do not see that it has ever been presented to any of these committees, or in any of the papers, or in any of the journals of this country, and I tell you right now, but for the progressive movement that elected certain men to the Senate, and a majority in the House of Representatives, this country would soon be afflicted with "The National Reserve Association" or "Morgan-Aldrich money monopoly system " that would make it impossible for us to have a representative form of government in this country.

This National Reserve Association scheme is the evolution of years; it accords with the maxim of the money lenders of the Old World, Let us the control of the money of a country and we care not who makes its laws." The Aldrich-Vreeland emergency currency bill was hustled through Congress. It left the people of this country absolutely defenseless in case of a panic. It put those financiers in a panic-proof position. In the first place, this bill puts the people absolutely at the mercy of the banking corporations. They can now contract the currency and bring on panics; and while the people are unable to get money at any price these institutions can put up anything as security, from bonds down to one-name paper, and, simply by indorsing it, have $500.000.000 in cash turned over to them in this new currency, according to the recent ruling of the Acting Secretary of the United States Treasury, A. Piatt Andrew, also special assistant to the National Monetary Commission. Now, we come to the danger point. There is loaned on demand in the United States $1,398,000,000 of money. After you take out the reserves of the national banks and what is impounded in the Treasury, you have $1,650,000,000 to carry on the commerce of the United States, a margin of only $300.000.000 above these demand loans. A demand of 5 per cent can plunge this country into a panic.

There was a special statement made to the Monetary Commission by the Comptroller of the Currency showing that the loans on demand of all the banking institutions of the United States amounted to $2,598,000,000. That is $900,000,000 more than is actually in circulation in the currency system of the United States. Is not that a very defenseless position for 90.000.000 people engaged in business, not thinking about this dangerous situation, thoughtlessly going on and making calculations as to what they are going to do this year or the year after? This is a statement on which I have the dates and the figures, and is not the suggestion of any dreamer. I have studied and watched this thing as a man earnestly concerned in the future of our republican form of government, and in my travels in Europe, and in my reading and thoughts for years. The destruction, practically, of the governments of the world have been brought about by this underlying trouble. There is no country in the world that has ever had a money system in the interest of its people.

A great many people will naturally say, "What are you doing all this talking about unless you have a definite plan?" I have. It is a remarkable thing that in all the discussions you may have seen in regard to the merits of the foreign money systems you have heard most about England and least about France. France, as a matter of fact, has the best money system in the world. France has not known a panic for 50 years. France has control over the Bank of France. The Government regulates and runs the bank, and it was a very interesting cross-examination that the president of that bank was put through by our Monetary Commission; but they got some answers I do not think they wanted on the record.

This country can not compete with Europe as long as we have such a money system. The national and other banks in this country pay $175,000,000 interest on deposits, an average of over 3 per cent, before they begin to loan them out at all. The Bank of France does not pay a cent. They farm money out in the United States for anything they can get for it. It was shown here in a statement made