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The most surprising statement made to me was the following

I will have to start here, or shall I start over; shall I start where I left off?

The CHAIRMAN. Go ahead.
Mr. RAND (reading):

Last summer I asked some of the individuals in this group what their concrete plan was for bringing on the proposed overthrow of the established American social order.

I was told that they believed that by thwarting our then evident recovery they would be able to prolong the country's destitution until they had demonstrated to the American people that the Government must operate industry and commerce. I was told that the Government must operate industry and commerce. I was told that of course commercial banks could not make long-time capital loans and that they would be able to destroy, by propaganda, the other institutions that had been making our capital loans. Then we can push Uncle Sam into the position where he must make these capital loans. And, of course, when Uncle Sam becomes our financier he must also follow his money with control and management.

The most surprising statement made to me was the fellowing: "We believe that we have Mr. Roosevelt in the middle of a swift stream and that the current is so strong that he cannot turn back or escape from it. We believe that we can keep Mr. Roosevelt there until we are ready to supplant him with a Stalin. We all think that Mr. Roosevelt is only the Kerensky of this revolution.”

Mr. BULWINKLE. What is that, Mr. Roosevelt is the Kerensky of this revolution?

Mr. RAND. I am quoting Dr. Wirt's statement.

When I asked why the President would not see through this scheme, they replied: “We are on the inside. We can control the avenues of influence. We can make the President believe that he is making decisions for himself.” They said “A leader must appear to be a strong man of action. He must make decisions and many times make them quickly, whether good or bad. Soon he will feel a superhuman flow of power from the flow of the decisions themselves—good or bad. Eventually he can be easily displaced because of his bad decisions. With Mr. Roosevelt's background we do not expect him to see this revolution through.”

They said that such individuals can be induced to kindle the fires of revolution. But strong men must take their place when the country is once engulfed in flames.

I asked how they would explain to the American people why their plans for retarding the recovery were not restoring recovery. “Oh”, they said, “that would be easy.' All that they would need to do would be to point the finger of scorn at the traitorous opposition. These traitors in the imaginary war against the depression would be made the goats. And the American people would agree that they, the brain trusters, should be more firm in dealing with the opposition.

Thus they, the brain trusters, would soon be able to use the police power of the Government and “crack down” on the opposition with a big stick. In the meantime they would extend the gloved hand and keep the “big stick” in the back. ground.

Continuing Dr. Wirt's statement:

I was frankly told that I underestimated the power of propaganda. That since the World War, propaganda had been developed into a science. They that could make the newspapers and magazines beg for mercy by threatening to take away much of their advertising by a measure to compel only the unvarnished truth in advertising. That they could make the financiers be good by showing up at public investigations the crooks in the game. And that the power of public investigation in their own hands alone would make the cold chills run up and down the spines of the other business leaders and politicians-honest men as well as crooks.

They were sure that they could depend upon the psychology of empty stomachs and they would keep them empty. The masses would soon agree that anything should be done rather than nothing. Any escape from present miseries would be welcome even though it should turn out to be another misery.

They were sure that the leaders of industry and labor could be kept quiet by the hope of getting their own share of the government doles in the form of loans, and contracts for material and labor-provided they were subservient.

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They were sure that the colleges and schools could be kept in line by the hope of Federal aid until the many new dealers in the schools and colleges had control of them.

They were sure that their propaganda could inflame the masses against the old social order and the honest men as well as the crooks that represent that order.

I asked what they would do when the Government could not longer dole out relief in the grand manner. By that time, it was answered, the oft-repeated exhortation to industry and commerce to make jobs out of confidence and to produce goods and pay wages out of psychology, together with their other propaganda, would have won the people to the idea that the only way out was for government itself to operate industry and commerce.

The CHAIRMAN. Mr. Cooper.

Mr. COOPER. Is Mr. Lea going to insist on reading this letter in record?

Mr. BULWINKLE. Yes, sir; we want it all read.
Mr. LEA. Yes, sir.
Mr. RAND (reading):

They were certain that they did not want to operate agriculture for a long time. But the farmers could be won by doles to support Government operation of industry and commerce. Farmers would be delighted to get their hands in the public trough for once in the history of the country. The farmers would be one with the masses-united for a redistribution of the wealth of the other fellow. All that they would need to do with the opposition would be to ask, “Well, what is your plan?

There are a few paragraphs in the beginning which I will go back and read, which I have left out. I think it is very important that a statement of this kind, which is of a serious nature, should be taken up.

Mr. BULWINKLE. Just let me ask a question right there. You are a very intelligent and patriotic citizen, are you not?

Mr. Rand. I think I try to be.
Mr. BULWINKLE. You try to be?
Mr. RAND. Yes, sir.

Mr. BULWINKLE. And, after you received this communication from Dr. Wirt, did you make any inquiry of him who these brain trusters were that were sending chills up your spine?

Mr. RAND. Yes.
Mr. BULWINKLE. Did he tell you?
Mr. Rand. He said everyone knows.
Mr. BULWINKLE. Did he tell you their names?
Mr. Rand. No; he did not.
Mr. BULWINKLE. And you talked to him over the telephone?
Mr. RAND. Yes, sir.

Mr. BULWINKLE. And you knew that you were coming here before the committee?

Mr. RAND. Yes.

Mr. BULWINKLE. And you knew you were going to attempt to get that letter in the record?

Mr. Rand. Yes, sir.
Mr. BULWINKLE. In this committee hearing?
Mr. RAND. Yes, sir.
Mr. BULWINKLE. That is part of the reason why you are here?
Mr. RAND. Not part of the reason why.
Mr. BULWINKLE. The main reason why, then?
Mr. RAND. No; no.

Mr. BULWINKLE. And, notwithstanding all that, do you mean to tell this committee that you did not have curiosity enough to find out exactly who they were?

Mr. RAND. I did have curiosity to ask him whether he would come down and speak before this committee if called.

Mr. BULWINKLE. And what did he say?

Mr. RAND. He said, “I will gladly.” I thought it was better for him to speak for himself.

Mr. BULWINKLE. You never bothered with asking him then? You never bothered to find out the names of these people?

Mr. Rand. He assumed I knew in a general way who they are.
Mr. BULWINKLE. And you are just assuming?
Mr. RAND. What?
Mr. BULWINKLE. You are just assuming?
Mr. RAND. No.

Mr. BULWINKLE. In testifying before this committee, all that we can get out of you is an assumption?

Mr. RAND. No; not merely an assumption. I am presenting a statement.

Mr. BULWINKLE. All right. That is all.
Mr. Cole. Mr. Chairman
The CHAIRMAN. Mr. Cole.
Mr. COLE. What is the date of this letter?
Mr. BULWINKLE. You have the complete copy there?
Mr. COLE. I asked for the date of the letter, Mr. Chairman.

Mr. Rand. This letter came into my hands last evening for the first time, and I read it in its entirety this morning for the first time. It is dated

The CHAIRMAN. If you cannot find it, you can furnish that for the record.

Mr. MONAGHAN. I would like to ask, Mr. Chairman

Mr. COLE. I would like to know the date of the letter and to whom it was addressed.

The CHAIRMAN. Mr. Rand, the committee has expressed an interest in knowing the date of the letter, or course, and to whom it was addressed.

Mr. RAND. To whom it was addressed?
The CHAIRMAN. Yes.

Mr. RAND. That was sent to me as one of the members of a directing committee for the Nation.

Mr. MILLIGAN. Was addressed to you?
Mr. Rand. Yes. I assume so. I did not open the envelop myself.

Mr. MILLIGAN. Is letter directed to you on the inside? Have you you the original?

Mr. RAND. I beg your pardon.
Mr. MILLIGAN. Have you the original letter?

Mr. Rand. This is the letter here (exhibiting document]. It is a release, which he has given out for publication.

Mr. BULWINKLE. For publication on April 17. It is to be available only to a few friends. Mr. MONAGHAN. Mr. Chairman, I would like to ask Mr. Rand what possible bearing this particular letter which he started to read in response to the question which I asked him as to why section 12 should be stricken, could have upon that section 12, providing for the giving of information relative to stockmarkets to a public commission.

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Mr. RAND. Because it appeared that this broad power to call for any information that the regulatory commission thought was necessary would make possible for the regulatory authority to

Mr. BULWINKLE. Will you hand me that letter, Mr. Clerk?

Mr. RAND (continuing). Harass American business by calling for unreasonable reports.

The CHAIRMAN. We are very much obliged to you, Mr. Rand.
Mr. MILLIGAN. Mr. Chairman, may I ask a question?
The CHAIRMAN. Yes.

Mr. Rand. Might I state the last recommendation that I tried to get across, namely, that we strongly urge that whatever commission may be given in the final draft of the bill, or final settlement of this legislation

Mr. BULWINKLE. Mr. Witness, would you mind showing me where that letter is in this; this is what you handed me. I want to see the letter, if you have got one.

Mr. WOLVERTON. Mr. Chairman, the subject matter of this letter goes far beyond the scope of the bill, and affects all of the legislation that is being passed, and it just occurred to me that perhaps the proper procedure to investigate that would be a special investigating committee.

The CHAIRMAN. Probably.

Mr. BULWINKLE. You do not mean to tell me that you cannot find that letter after reading it here, do you?

Mr. RAND. I have a copy of it. I read from a copy of the letter.

Mr. BULWINKLE. Well, let us see the copy of the letter. That is what I am asking you for.

Mr. MONAGHAN. Mr. Chairman, it appears to me that the sole reason for the reading of this letter which is entirely irrelevant, is merely to drag a red herring across the trail of this bill for the regulation of stock exchanges and to reflect discredit upon the authors of the bill, and the so-called “brain trust”, and the President. I believe the whole thing is traitorous.

Mr. BULWINKLE. Where were you reading; what were you reading?
Mr. Rand. In here [indicating).

Mr. BULWINKLE. This is what I want to get. I may want it all in the record.

Mr. Rand. Here is where I read [indicating). That is where I started [indicating).

Mr. BULWINKLE. Will you mark it there?
Mr. RAND. Yes.

I would like to reply to that, that was only one sample of one instance of the possibility of control, or embarrassment to business through the asking of unreasonable--demanding unreasonable reports.

Now, there are other provisions that seem to be objectionable from our standpoint, such as section 11, section 12.

Mr. BULWINKLE. Just a minute, before proceeding on that. Is this your speech that you were getting up?

Mr. RAND. No.
Mr. BULWINKLE. What is the whole thing about anyhow?

Mr. Rand. This is a release by Dr. Wirt, which he sent to me and to other friends prior to its publication, and I took it. I only glanced at it hurriedly.

Mr. BULWINKLE. Well, you read it here indicating), the first paragraph from it, which says that it is available only for a few friends.

Mr. RAND. But, I called Dr. Wirt up on the telephone.

Mr. BULWINKLE. And he says that it is written in the hope that it may be helpful in their own writings. Is that correct?

Mr. RAND. Yes. I called Dr. Wirt and asked him if he had any objection to my using it and reading it, and whether he would come down to substantiate it if called upon, and he said, “No, absolutely, and I will come if called upon.”

Mr. BULWINKLE. I am going to ask that the entire letter be put in the record. I am going to ask that that all be put into the record.

The CHAIRMAN. All right.

(The portions of the paper above referred which were not read by the witness are as follows:)

This manuscript has not been written for publication. I merely want to make the material herein presented available to a few friends in the hope that it may be of help to them in their own writing. You are welcome to use any or all of it in any way that you see fit.

The fundamental trouble with the “brain trusters" is that they start with a false assumption. They insist that the America of Washington, Jefferson, and Lincoln must first be destroyed and then on the ruins they will reconstruct an America after their own pattern. They do not know that the America of Washington, Jefferson, and Lincoln has been the "new deal” and that during the eighteenth and nineteenth centuries we have been making great social progress. The common man is getting his place in the sun. Why try to put him back into the dark ages?

The CHAIRMAN. All right, Mr. Rand, we must get through with another witness this morning.

Mr. RAND. I still have not had an opportunity to get across that 3 percent.

The CHAIRMAN. I understand that, but you have had an hour and fifteen minutes and

Mr. RAND (interposing). Mostly on questions asked.

The CHAIRMAN. Most of which was off of the subject. We will hear Mr. Evans Clark.

Mr. Clark, will you qualify by giving your full name and capacity in which you appear?

Mr. WOLVERTON. Mr. Chairman, before Mr. Rand leaves the stand, may I make an observation?

The CHAIRMAN. Yes.

Mr. WOLVERTON. I am inclined to believe that some of the unwarranted statements that were made by leading business men, not based on actual fact, do more to upset the public mind than the provisions of this bill.

The CHAIRMAN. I think that that would be agreed to by all sensible people.

STATEMENT OF EVANS CLARK, DIRECTOR OF THE TWENTIETH

CENTURY FUND, INC. The CHAIRMAN. Mr. Clark, will you qualify by giving your full name and the capacity in which you appear?

Mr. CLARK. My name is Evans Clark, and my position is executive director of the Twentieth Century Fund, Inc.

The CHAIRMAN. You may proceed in your own way, Mr. Clark.

Mr. CLARK. Mr. Chairman and gentlemen of the committee, I am glad to accept the invitation of the committee to appear before you

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