Browsing "Aftermath: The Gilded Age"

The Dollar Invades and Conquers

Lee was not alone in seeing the masked reasons for the war prosecuted by the North and the opportunity seen in reducing the American South to a politically-weak economic colony. The bounty-enriched foreign mercenaries and displaced slaves used to fight its war of conquest were expendable tools for the task, and later employed to eradicate Indians.

Bernhard Thuersam, www.Circa1865.com

 

The Dollar Invades and Conquers

“Certainly he must have sensed that in the future “those people,” as he called his Northern adversaries, were determined to push aside “his people” with their aristocratic prerogatives and privileges. Despite his determination to stay out of politics both during and after the war, Lee could see the handwriting on the wall as plain as anyone, and plainer than most.

He understood that in addition to the sharp odor of gunpowder, there was the sweet smell of profits in the balmy spring air. Lincoln’s Secretary of the Treasury, visiting New York earlier that spring, had noted that many people there paid more attention to the stock market than to the casualty reports. To this a New York editor added: “Real or professed patriotism may be made to cover a multitude of sins. Gallantry in battle may be regarded as a substitute for all the duties of the Decalogue.”

In the Northern States, the rapid transformation from a conglomeration of farmers to a nation of industrialists had been hastened by the war. The exclusion of Southern planters from the halls of government made the change considerably easier. Astronomical profits on wartime speculation and gouging encouraged rapid expansion. While the brave boys in [blue] shed blood on the battlefields, the crafty made profits back home.

If the drama of collapse and surrender centered in the South, the drama of growth and expansion focused on the West. Hundreds of millions of dollars would go there; the receding frontier would be whittled down by systematic attacks of the Yankee investor. The Federal government would help by showering the railroads and settlers with land and services. Mines, cattle and farming would boom. Where bayonet had never been, the dollar would invade and conquer.”

(Lee After the War, Marshall W. Fishwick, Dodd, Mead & Company, 1963, pp. 39-40)

 

The North’s Extended Payday

Beyond eliminating Negro slavery in the South, the war “hastened the transformation of the North from a country of farmers and small manufacturers to a highly organized industrial region.” The North had no shortage of those who saw no need to carry a rifle, as great profit awaited those supplying war materiel.

Bernhard Thuersam, www.Circa1865.com

 

The North’s Extended Payday

“With the war, too, came what moral philosophers have said was moral decay in wholesale volume, an apparently illimitable increase in man’s cupidity. Scandals uncorked during and right after the fighting showed that [Northern] soldiers had been given clothing and blankets made of shoddy, technically a material of reclaimed wool, such as old rags, which gave a new term to our language.

Soldiers also got boots made largely of paper; they were fed meat that had come from diseased cattle and hogs; they rode hags that had been doctored to make a sale to the cavalry. Only too often the very guns put into their hands would not shoot. One big order for such weapons, refused by ordnance offices in the East, was sold and shipped to General [John] Fremont in the West.

Likely the moral condition of the country was lower than usual. Perhaps the moral philosophers should take into account the possibility that man’s inherent cupidity fluctuates, like a thermometer, with the number and quality of opportunities to commit theft, legal or otherwise; that the honesty of too few men is constant.

The decade after 1865 in the United States appears in retrospect to be an extended payday for the vast military exploit just concluded. Somebody observed it was as if Booth’s bullet had released all the chicanery and cupidity of thirty-five million people. Pastor’s warned that God’s hand would smite the Republic. And yet, the more numerous and grosser sort continued to admire the “smart” man.

The most notoriously smart figures of the postwar period in the United States were three characters who without too much exaggeration were also known as the men of disaster. They were Daniel Drew, Jay Gould, and Jim Fisk. Many called them wreckers, “Foul hyenas,” said an editorial writer of the time, “who when their prey was full rotten came to sink their slavering jaws into the carrion.”

As a big herd of anywhere from six hundred to a thousand head of Ohio beef approached New York City, Drew had his drovers salt them well, then, just before reaching the market place, let them drink their fill. Cattle were sold live-weight. Drew’s processing with salt and water added many tons to the average herd [and] “Watered stock” soon became a term in Wall Street.

Jim Fisk was a genial, handsome fellow . . . Both men and women liked him. He could sell them stuff they did not want before they realized they had bought it. When New Orleans fell into federal hands, Fisk took off to buy cotton for a Boston syndicate, which made a mint of money quickly.

(The Age of the Moguls, Stewart H. Holbrook, Doubleday and Company, 1953, excerpts, pp. 20-24)

The Northwest Sacrifices a Valuable Ally

The excessive emphasis on African slavery obscures the many economic and cultural causes of the War Between the States, though it was clear that two Americas that had developed by the 1850s: one industrial and seeking government protection – and the other agricultural and opposed to protectionist tariffs and government subsidy.  The war between the two Americas had more to do with economics and culture than with the residue of a British colonial labor system that the American South would deal with — as the New England States had done earlier — and without war.

Bernhard Thuersam, www.Circa1865.com

 

The Northwest Sacrifices a Valuable Ally

“Lincoln and his contemporaries interpreted the victory of the North as primarily a triumph of nationalism over States’ rights. That the Union was now in fact “one and indivisible” . . . was generally acknowledged . . . [but] Whether a long civil war was necessary to secure the triumph of nationalism over States’ rights and of abolitionism over slavery may well be doubted. Probably, with more skillful handling of a few crises, both ends might ultimately have been achieved without resort to war.

A factor not fully understood at the time, and possibly overemphasized today, was the commanding importance that the new industrial interests won during the course of the struggle. War profits compounded the capital of the industrialists and placed them in a position to dominate the economic life, not only of the Northeast where they were chiefly concentrated, but also of the nation at large.

With the Southern planters removed from the national scene, the government at Washington tended more and more to reflect the wishes of the industrial leaders. The protective tariff, impossible as long as Southern influence predominated in national affairs, became the corner-stone of the new business edifice, for by means of it the vast and growing American market was largely restricted to American industry.

Transcontinental railroads, designed to complete the national transportation system, were likewise accorded the generous assistance of the government, while a national banking act and a national currency facilitated still further the spread of nation-wise business.

The Northwest, where industry was definitely subordinate to agriculture, profited less from the war than the Northeast . . . [though by] assisting in the defeat of the South, however, the Northwest had unknowingly sacrificed a valuable ally. Before the war the two agricultural sections had repeatedly stood together, first against the commercial, and later against the industrial, Northeast. Now, with the weight of the South in the Union immensely lessened, the Northwest was left to wage its battles virtually alone. For more than a generation after the war, with eastern men and eastern policies in the ascendancy, American industry steadily consolidated the gains it had made.”

(The Federal Union, A History of the United States to 1865, John D. Hicks, Riverside Press, 1937, pp. 686-688)

Industrial Machines and Political Machines

The triumph of Northern arms in 1865 ensured the political supremacy of the New England industrial elite over the agricultural South — the South that presided over the republic’s “classic years,” defended its political conservatism and produced most of the presidents. With the South in ruins, industrial interests with unlimited funds and government patronage had won the second American revolution.

Bernhard Thuersam, www.Circa1865.com

 

Industrial Machines and Political Machines

“What Charles Beard has called “the second American Revolution — the revolution that assured the triumph of the business enterprise — had been fought and largely won by 1877. In four great lines of endeavor — -manufacturing, extractive industries, transportation and finance — business marched from one swift triumph to another.

In 1860 about a billion dollars was invested in manufacturing plants which employed 1,500,000 workers; but in less than fifty years the investment had risen to 12 billions and the number of workers to 5,000,000.

A bloody and riotous year, violence was everywhere evident in the America of 1877. The great railroad strike of that year was the first significant industrial clash in American society. “Class hatred,” writes Denis Tilden Lynch, “was a new note in American life where all men were equal before the law. The South was in the turmoil of reconstruction, sand-lot rioters ruled in San Francisco; and 100,000 strikers and 4,000,000 unemployed surged in the streets of Northern cities.

At a cabinet meeting on July 22, 1877, the suggestion was advanced that a number of States should be placed under martial law.

Once triumphant, the industrial tycoons discovered that they could not function within the framework of the social and political ideals of the early Republic. To insure their triumph, a new social order had to be established; a new set of institutions had to be created of which the modern corporation was, perhaps, the most important . . . [and with] the Industrial machine came the political machine.

Dating from 1870, the “boss system” had become so thoroughly entrenched in American politics by 1877 that public life was everywhere discredited by the conduct of high officials. The simplicity of taste which had characterized the “classic” years of the early Republic gave way to a wild, garish, and irresponsible eclecticism. “The emergence of the millionaire,” writes Talbot Hamlin, “was as fatal to the artistic ideals of the Greek Revival as were the speed, the speculation and the exploitation that produced him.”

In one field after another, the wealth of the new millionaire was used to corrupt the tastes, the standards, and the traditions of the American people.”

(A Mask for Privilege, Carey McWilliams, Little, Brown & Company, 1948, pp 8-10)

Men of the Republican Political Machine

Congressman Roscoe Conkling of New York controlled patronage positions in the New York customhouse after the war, and selected friend and future vice president and president Chester Arthur to the top position of collector in 1871. Seen as a loyal Republican Party hack, Arthur was accused by reformers of taking “illegal kickbacks, overstaffing, insidious accounting and lax administration.” Ironically, Arthur’s custom house corruption investigation was initiated during the presidency of Rutherford B. Hayes, himself known as “His Fraudulency” and elected by Republican Party vote-fraud in the occupied South.

Bernhard Thuersam, www.Circa1865.com

 

Men of the Republican Political Machine

“The Radical Republicanism that defined the immediate years after the Civil War was an attempt by Congress to reengineer the former slave States. The Radicals narrowly failed to remove President Andrew Johnson . . . [was followed] by the election of Ulysses S. Grant. Grant had been a crusty, drunken, charismatic commander, but his presidency marked the end of the politics of passion and the beginning of a long period when personalities determined factions, and when competent, loyal (and at times corrupt) insiders thrived.

Grant’s defenders described him as an icon of pragmatism . . . his detractors assaulted his administration as a descent into a world where the highest bidder was rewarded. By the late 1860s, a new generation of Republicans and [Northern] Democrats jelled into a political class that shared a desire for order and control.

In place of stirring orators debating high principles . . . the Senate was occupied by a class of politicos who believed in “women, wine, whiskey, and war,” as Senator John McDougall of California remarked. They reveled in the martial cult of the Civil War and eagerly supported America’s military expansion against the Native Americans of the Plains. But they reveled more in the political machine and its benefits.

[Grant’s Vice-President Roscoe] Conkling defended the machine as necessary and even constructive force in American political life, thundering, “We are told that the Republican Party is a machine. Yes. A government is a machine, the common-school system of the State of New York is a machine, a political party is a machine . . .”

For him, as for Chester Arthur and even James Blaine, the party was a church to which absolute fealty was expected and demanded, and in emotional moments these men of the machine could wax about its virtues with the romantic zeal of a lover serenading his loved one.

In 1871, Arthur was offered one of the plum positions in the federal bureaucracy, the collector of New York Customhouse. The position of collector had opened up when the former occupant, Arthur’s friend Tom Murphy, was forced to step down in the face of corruption allegations.

The port of New York was the primary gateway for goods from abroad, and smuggling was a constant. As an incentive, officials who snared illegal, unregistered or undertaxed shipments were entitled to a percentage of the goods seized or the fines levied. This “moiety” process made it possible for even a low-level official to double or triple his income . . . [while] it struck reformers . . . as unsavory.”

(Chester Alan Arthur, Zachary Karabell, Henry Holt and Company, 2004, excerpts, pp. 18-20; 22)

Postwar Whiskey, Beer and Dollar Bills

In 1880, the shooting war had been over for 15 years though a conflict raged for political control of the South until 1877. James Garfield and Chester Arthur eked out a slim victory in 1880, and the New York Times wryly observed that so many [Republican] factions were convinced that they had been promised cabinet positions that “if all reports are true, President Garfield’s Cabinet will contain about one hundred and twenty-five persons.” The elimination of Southern conservative influence in Congress led to the corruption of the Gilded Age.

Bernhard Thuersam, www.Circa1865.com

 

Postwar Whiskey, Beer and Dollar Bills

“The [presidential] campaign of 1880 is notable mostly for what it lacked. It was a contest of organization and will, not a battle over the future direction of the country. The Republican factions in Chicago were divided by personalities, not by beliefs, and the [Northern] Democrats did not offer a dramatically different vision.

But the main attraction had all the ideology of a horse race. That fact did not escape the disgusted intellectuals who sat on the sidelines wondering what had happened to the once noble republic of Washington [and] Jefferson . . . [and] . . . What was the election about, really, other than who would win?

[Republicans and Democrats] voted because of party loyalty or because some local organizer sweetened the pot. They voted because a Republican precinct boss in New York Boston or Buffalo or St. Louis or Nashville invited them to a picnic on a fine Sunday on September, trucked out a few respected and/or dynamic speakers, and handed out whiskey, beer and dollar bills.

Yet if you had collared [James] Garfield and Arthur or [Winfield Scott] Hancock . . . and asked them if they stood for anything, they would of course had said yes. They would have said they stood for good government, for the hopes and dreams of the common man, for the expansion of trade, for orderly cities and prosperous farms, well-managed railroads, solvent banks, stable currency, and the settlement of the West.

Having served the Union during the Civil War, they felt the North’s victory had closed the last great fissure that had threatened a country founded on principles of liberty, freedom and the pursuit of happiness. It wasn’t that they eschewed ideology . . . They believed, simply, that everyone would be best served by a government led by their faction. Political appointments and party discipline helped ensure order nationally, and if party leaders stood to gain from electoral success, all the better.

Most politicians of the era saw no inherent conflict between government service and personal gain. They would have looked at later generations of Americans, at the reformers of the twentieth-century who created one box for public service and a separate one for private advancement, and scoffed at the naivete. Most politicians of the 1870s and 1880s looked a government as a vehicle for both.

Accusations that they were feeding at the public trough made minimal sense to them. Government was an institution for the public good that was meant to reward those who entered it.

[To win] the pivotal State of Indiana, Arthur delegated Stephen Dorsey, the former carpetbag Arkansas senator. Dorsey was the ablest fund-raiser the [Republican] Stalwarts had, though it was understood that he was a political operator not afraid to push beyond the limits of law and propriety. He was the type of operative who gives politics a bad name. Dorsey went to the land of the Hoosiers, got some votes legally, and paid for others.

In 1880, not a single State south of the Mason-Dixon Line went Republican, and not a single State from the North went Democratic. A banquet was held by the Union League Club at Delmonico’s to honor Stephen Dorsey for delivering Indiana to the Republicans.

Reform-minded editors like E.L. Godkin sighed that the episode confirmed the venality of politics . . . Dorsey had already been the target of a congressional investigation into the “Star Route” scandals, a scheme that had made a number of Republican loyalists rich from postal route concessions at the federal government’s expense.”

(Chester Alan Arthur, Zachary Karabell, Henry Holt and Company, 2004, excerpts, pp. 45-47; 50, 54)

Scotch Presbyterian Conscience versus Piles of Gold

Woodrow Wilson’s offer of mediation between Britain, France and Germany came some 45 years after Britain and France offered to mediate the conflict between America’s North and South. Lincoln threatened war should they intervene. Lincoln also came to realize the vast money power he had unleashed with war as business interests colluded with government, which led to the postwar Gilded Age. Wilson was elected to stay out of the European war but succumbed to the money power Lincoln had unleashed, and more dark forces drew him into war though a negotiated peace was fully possible. Sadly, with American intervention and Allied victory came the rise of a German national socialist party and many more American dead.

Bernhard Thuersam, www.Circa1865.com

 

Scotch Presbyterian Conscience versus Piles of Gold

“Woodrow Wilson returned to Washington after the 1916 [presidential] campaign convinced that his mandate from the nation demanded the immediate formulation of peace terms which must somehow be forced on the warring powers.

Physically he was worn out. His sick headaches continued to worry [wife] Edith and Dr. Grayson. His head still spun with the clamor of political oratory.

He felt that British and French dependence on American supplies and American credit might give him a whip hand over the Allies if he could only find how to apply it. One third the world’s gold supply was already piled up in the vaults of American banks. “We can determine to a large extent who is to be financed and who is not to be financed,” he had told an audience gathered at Shady Lawn during the campaign.

He summoned the confidential colonel [Edward M. House] to the White House to resume his last winter’s intrigue for mediation. For once House balked. He was convinced the United States should already have intervened on the side of the Allies. Peace now could only be to Germany’s advantage: “I argued again and again that we should no pull Germany’s chestnuts out of the fire.” They broke up late. Neither man would budge from his position.

House’s point was that the German’s now wanted mediation and were holding the threat of a renewed submarine campaign over the world’s head to obtain a victorious peace. “In my opinion,” House noted . . . “the President’s desire for peace is partially due to his Scotch Presbyterian conscience and not to personal fear, for I believe he has both moral and physical courage.”

Like any oldtime Covenanter Wilson believed in the efficacy of the word. By the right word men could be brought to see the light. The war was making the position of neutrals intolerable.

[He wrote] that the warring nations were all fighting, so they claimed, “to be free of aggression and of peril to the free and independent development of their people’s lives and fortunes . . . must the contest be settled by slow attrition and ultimate exhaustion?” he asked. “An irreparable damage to civilization cannot promote peace and the secure happiness of the world.”

(Mr. Wilson’s War, From the Assassination of McKinley to America’s Rejection of the League of Nations, John Dos Passos, Hamish Hamilton, 1963, pp. 189-190)

 

Union Saved for Republican Party Hegemony

With the South out of Congress since 1861 and no Southern leadership to provide a conservative and responsible voice in US government, the predictable occurred. As a soldier Grant was a butcher who sent wave after wave of new recruits to wear down the thin Southern brigades; as a politician, Orville H. Browning of Illinois described Grant as “weak, vain, ignorant, mercenary, selfish and malignant”; that he was surrounded by corrupt and unprincipled men and that his reelection would be a great calamity to the country.” Grant’s election in 1868 was achieved with a few hundred thousand freedmen votes, they herded to the polls by the Republican’s terrorist Union League.

Bernhard Thuersam, www.Circa1865.com

 

Union Saved for Corrupt Republican Party Hegemony

“The eight years of Grant’s administration rocked with one scandal after another. Citizens defrauded the government in the acquisition of land and in claims for [Northern veteran] pensions; contractors supplying the army and navy were often venal; and unscrupulous lawyers levied toll on ignorant and defenseless Indians.

Members of Congress were bribed and disgraced. Cabinet officers were investigated and impeached. Subordinate officials and employees were revealed in outright betrayal of public trust. Never had the Republic sunk to so low an estate of official morality.

During the 1870s there was both incompetence and dishonesty in the large customhouses; discipline and integrity among the navy-yard labor forces were at a low ebb; the Indian service had been roundly condemned by [James] Garfield; land agents connived at irregularities, and surveyors made fraudulent claims for work not performed.

The tone of the eight years of Grant’s administration was . . . set by a small number of weak and unreliable persons holding seats in Congress and in high executive office. It was during these years that the most resounding scandals occurred, not only in Washington but in many States and cities. When the mighty wandered far from the paths of rectitude, it was not surprising that some of the lesser ranks followed their example.

To a few of the scandals we turn . . . The Credit Mobilier . . . originally organized to finance railroad construction, [it] fell into the control of a group of adventurers, including a member of Congress, Oakes Ames. The corporation was awarded a lucrative but fraudulent contract for the . . . [Union Pacific Railroad and disgraced Grant’s] Vice Presidents Colfax and Wilson.

Laxness or corruption in the award of Indian trading posts had been suspected for some time under General [William] Belknap’s administration of the War Department. [Secretary of the Navy George M. Robeson levied] percentages on . . . contractors’ engagements with the navy, [and] Robeson grew rich. [Secretary of the Treasury John D. Sanborn, a protégé of Benjamin Butler, siphoned money destined for the Internal Revenue Service].

The most dramatic and perhaps the most damaging evidence of corruption during the Grant administration involved the evasion of internal revenue taxes on distilleries. Fraud had long been suspected [and persons involved] included General John A. McDonald, collector of internal revenue in St. Louis . . . other collectors, the chief clerk of the internal revenue division of the Treasury Department in Washington [and] General Orville Babcock, President Grant’s private secretary, who was subsequently indicted but who escaped conviction.”

(The Republican Era, 1869-1901, A Study in Administrative History, Leonard D. White, Macmillan Company, 1958, excerpts pp. 366-373)

The Anticipated Profits of Next Year’s Pay Checks

Lincoln instituted a national banking system which “developed into something that was neither national nor a banking system” and more represented a loose organization of currency factories “designed to . . . [serve] commercial communities and confined . . . almost entirely to the New England and Middle Atlantic States.” This system was more concentrated in New York and fraught with abuses, and superseded by the even more abusive Federal Reserve Act of 1913.

Bernhard Thuersam, www.Circa1865.com

 

The Anticipated Profits of Next Year’s Pay Checks

“July 3, 1930

Mr. McFadden: “Mr. Speaker and gentlemen, time and events have arrived at a point where we should no longer deceive ourselves concerning the business situation. Continued statements of unfounded optimism will have only an unhappy effect upon the minds of millions of our citizens who are now unemployed and who, in the circumstances, must continue to be unemployed for many months to come. The economic condition in which we find ourselves is too sustained and deeply seated to be met by pronouncements that it does not exist.

Let us face the truth – that we and the world are undergoing a major economic and business adjustment which is and will be both drastic and painful. These consequences will be particularly severe in the United States, because they will force many people to recede from the standards of living and expenditure attained during the past 14 years.

Some part of this condition is the natural consequence of the operation of basic economic laws which function with little regard for human legislation. A large part is due to mismanagement of our national affairs. A still larger part is due to a deliberately contrived and executed program which has as its object the impoverishment of the people of the United States.

The end of the World War found us with a greatly expanded industrial and credit structure, to large, by far for the requirements of our national needs as the latter existed before the beginning of the war period of abnormal consumption. It was clearly a time to halt and to analyze fundamental economic facts. We did not do this.

Rather we chose to proceed with our abnormal production and to stretch the limits of credit still further. War production and its profits had made Americans drunk with power, and ambition for more power. Luxuries developed in the disorganization of war became necessities with the reestablishment of peace.

The American peop0le entered upon a decade in which the whole structure of their lives was to be passed upon the principle of discounting the future. A vast system of installment credit sprang into life almost overnight, aided by the optimism of the Federal Reserve system. The automobile industry expanded more rapidly and to greater size than any industry had expanded in history.

The public was encouraged by advertising and propaganda to buy beyond its immediate means. Further industrial expansion was financed by the same expansion of credit which made installment buying possible. Consumption was expanded and financed upon the consumer’s promise to pay and production was expanded upon by capitalizing the producer’s hope that the consumer would keep that promise.

In the period between 1920 and the present time we experienced the full use and purpose of the credit machinery built up with the Federal Reserve system. It was but a logical development that anticipated profits should be capitalized as anticipated production and consumption had been capitalized – and that the Federal Reserve system should in turn finance tis capitalization of anticipated profits.

The entry of millions of Americans of moderate means into stock-market speculation [was] a natural consequence of the policy of expansion to which we had committed ourselves. It was also a logical development that the Federal Reserve should expand broker’s loans to make possible a huge inflation of the business of speculating in securities on margins.

All this brought the country to a point where the individual was living beyond his personal means, buying more than he could afford on his hope that he could afford to pay for it in the future and then speculating in the hope that he could make enough profit to pay his debts when they came due. In brief, the greater part of the American business structure was built upon the anticipated profits of next year’s pay checks.”

(Basis of Control of Economic Conditions, the Collective Speeches of Congressman Louis T. McFadden, Omni Press, 1970 pp. 64-66)

McFadden and the Federal Reserve

Congressman Louis T. McFadden of Pennsylvania was Chairman of the House Banking and Currency Committee in 1932, and a staunch opponent of the Federal Reserve. Along with Congressman Charles A. Lindbergh, Sr. he fought the Federal Reserve Act in 1913 and conducted one of the first investigations of the banking and money trust in Congress. The path to the Federal Reserve act began with Lincoln who admitted that “as a result of the war, corporations have been enthroned and an era of corruption in high places will follow and the money power of the country will endeavor to prolong its reign by working on the prejudices of the people until wealth is aggregated in the hands of a few and the Republic is destroyed.” Lincoln destroyed the Republic with war, invasion, fiat money and the marriage of business and government.

Bernhard Thuersam, www.Circa1865.com

 

McFadden and the Federal Reserve

“Friday, June 10, 1932

Mr. McFadden: Mr. Chairman, we have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve banks. The Federal Reserve Board, a Government board, has cheated the Government of the United States and the people of the United States out of enough money to pay the national debt.

This evil institution has impoverished and ruined the people of the United States; has bankrupted itself, and has practically bankrupted our Government. It has done this through the defects of the law under which it operates, through the maladministration of that law by the Federal Reserve Board, and through the corrupt practices of the moneyed vultures who control it.

Some people think the Federal Reserve Banks are United States Government institutions. They are not Government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lenders.

In that dark crew of financial pirates there are those who would cut a man’s throat to get a dollar out of his pocket; there are those who send money into States to buy votes to control our legislation; and there are those who maintain an international propaganda for the purpose of deceiving us and of wheedling us into the granting of new concessions which will permit them to cover up their past misdeeds and set again in motion their gigantic train of crime.

Those 12 credit monopolies were deceitfully and disloyally foisted upon this country by bankers who came here from Europe and who repaid us for our hospitality by undermining our American institutions. Those bankers took money out of this country to finance Japan in a war against Russia.

They created a reign of terror in Russia with our money in order to help that war along. They instigated a separate peace with Germany and Russia and thus drove a wedge between the allies in the World War. The financed Trotsky’s mass meetings of discontent and rebellion in New York. They paid Trotsky’s passage from New York to Russia so that he might assist in the destruction of the Russian Empire.

They fomented and instigated the Russian revolution and they placed a large fund of American dollars at Trotsky’s disposal in one of their branch banks in Sweden so that through him Russian homes might be thoroughly broken up and Russian children flung far and wide from their natural protectors. They have since begun the breaking up of American homes and the dispersal of American children.”

(Collective Speeches of Congressman Louis T. McFadden, Omni Press, 1970 pp. 298-299)

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