hundreds of local unions and their thousands of members federated in the national iron workers' organization, the officers of which, or some of them, seem to have been lawless and unfaithful to the highest interests of labor. Out of several million union men only a few dozen are even accused; but over half of all national bankers confess their guilt on oath. How can the Federal Government justly and safely pursue and punish lawless workingmen unless it as relentlessly prosecutes and brings to justice the guilty bankers of the United States against whom already it has ample and conclusive evidence in the shape of sworn confessions now on file in the office of the United States Comptroller of the Currency. Why has not prosecution against even one of the thousands of rich and powerful bankers conclusively shown by the Government records to be law-breakers been started by the Department of Justice? If the laws and penalties have been made inadequate at the instigation of the offending but politically influential men and banks now shown by the United States Comptroller to have been all along violating law, why did not the President indorse, in his financial message to Congress on December 21, 1911, the earnest and urgent recommendation of the Comptroller in his December 4, 1911, report that the laws be amended to reach the high grafting bank criminals, instead of endorsing the Aldrich plan for a private central bank multiplying a hundred times the profits and power of these very lawless bankers? The law requires banks always to have a cash reserve equal at least to a certain specified per cent of its total loans of bank "credit," varying from 15 to 25 per cent according to locality. Loans of credit average at least ten times the cash in reserves. This is because three-fifths of the reserve of a "country bank" can be deposited in a central reserve city bank where it becomes the basis for another volume of credit loans. To say that the cash reserve of a bank is below the legal requirement is merely another way of saying that the bank has illegally and dangerously inflated its loans of credit out of all lawful proportion to its cash reserve. The larger the volume of such loans of credit the greater the profit that the bank gets with the same investment. So usually it is done deliberately, and solely for extra profit. There might be some moral excuse during a panic for reserves being below the legal limit, but there has been no panic now for over four years. On page 22 of said report it is shown that in the 42 years since the present system started the national banks have actually earned net $3,107,185,441, and have paid $2,336,815,679 as dividends. The average dividends of all the banks, good and bad, during 42 years was 9.07 per cent, and for the year to June 30, 1911, it was 11.38 per cent, and net earnings 15.57 per cent, on their capital stock. Of course many individual banks earn 20, 30 and some even 50 to 100 per cent. So their violation of law to gain more profits was unnecessary as a reasonable business matter and seem to put the majority of the bankers of the country and many of the great leaders of finance in the unenviable position of mere reckless, gambling financial adventurers, willing to ignore and break the laws of the land and endanger the safety of the deposits of the people for the chance of getting just a little bigger profits for themselves. Does the business of banking tend to make good men narrow, selfish, sordid and criminal, or do men of that natural stripe seek control of banks to gratify their inordinate lust for profit and power? Truly the banking system needs "reform," but not the kind the bankers now are seeking and always seek. Does it not morally need fumigating? Whatever delinquency there is in the present system and law the financiers are responsible for it. Usually they have framed most monetary and banking legislation and induced Congress to adopt it. Some provisions of the law are as harmless to malefactors as the "ten commandments," because intentionally or unintentionally the law was framed to provide no way of enforcing it-no criminal penalty for its violation. The showing of bank violations made by the present Comptroller in his report must have existed at least to a greater or less extent during the terms of former U. S. Comptrollers. Why was not the law enforced against the offending banks? Why were not those dangerous conditions that so gravely affect the interests of depositors and the soundness of banks and the strength and stability of the country's financial and banking system exposed and correction of the evils and abuses demanded by former U. S. Comptrollers? We do not know that there was any connection between this seeming neglect by some of the highest public duty, which conferred such rich and valued immuni ନ UNCLE SAM:-FIFTY-NINE PER CENT OF ALL ties upon lawless banks and bankers, and the well-known On page 31 of his report the present Comptroller says: "Sixty per cent of the failures of national banks have been caused by violations of the national banking laws." The management often is reckless and rotten as well as criminal. Concealed losses because of improper loans to favorites and otherwise are "charged off" amounting to hundreds of millions of dollars. Inordinate profits alone have prevented general ruin of banks. Just consider what it means, the fact that most of the deposit savings of all the people of the United States are in the custody of these criminal "guardians"! If the Aldrich central bank plan is adopted by Congress, an absolute majority of the shares and control of the National Reserve Association will be owned and forever held by banks officially shown by the Federal Government and admitted under oath to be guilty of repeatedly, knowingly and wilfully violating their charters and the laws of the land just for the profits there was in it. Is Congress ready to turn over for fifty years the entire public currency and all the revenues of the Government and the other imperial powers demanded to a private corporation so owned and controlled? The people soon will know. CHAPTER XVII. CRIME OF CONSPIRACY. 40,000 Bank Officers and Directors Each Liable to $10,000 Fine and Two Years' Imprisonment. The reason the Ten Commandments announced by Moses, or some of them, are constantly violated by so many people is because the penalty prescribed will be inflicted in the next world-perhaps-instead of in this. The chances of punishment are too slim and remote. That is the precise reason why so many distinguished bankers break the laws of the land over and over day after day, week after week, month after month, year after year. For instance, in his official report of December 4, 1911, the U. S. Comptroller on page 22 (quoted in the preceding chapter), charges that on September 1, 1911, 59.87 per cent of all national banks were violating four separate provisions of the national bank law, viz., Secs. 5137, 5191, 5200 and 5202, prohibiting loans on real estate, inadequate cash reserves, excessive loans to borrowers and excessive indebtedness by banks, respectively. No penalty whatever against bank officers and directors committing such offenses against the law is prescribed in the "National Bank Act." These restrictions were imposed by law for the protection of depositors and the good of the community, to make banks more sound. Every time these provisions of law are broken it is a menace to the safety of depositors and the public welfare and every offense is committed knowingly by officers and directors for profit. There are severe penalties, fine and imprisonment for offenses like embezzlement by subordinates against the interest of banks, but no penalties are imposed upon officers and directors who ignore and violate practically every provision of law enacted to protect depositors and the public. As the system was devised and framed by the financiers this condition of course was not accidental. For almost fifty years bank influence and intrigue has prevented Congress enacting amendments in the public interest recom |