Money Changers

The same day that President Roosevelt announced his new policy of buying and minting domestic silver (see above), he received an interim report from the RFC on his gold buying program. Out of $75,000,000 allotted it since the start of the purchase plan Oct. 26, the RFC had spent $17,000,000 on domestic gold, $45,000,000 on foreign gold. Therefore to maintain its buying power in the gold market the RFC was allotting itself another $25,000,000. President Roosevelt felt that $100,000,000 was a cheap price to pay for eight weeks of his experiment in dollar depreciation.

Meanwhile at Manhattan's Economic Club the night before the President's monetary policy and those who back it once more came under critical discussion. First speaker was Senator Elmer Thomas of Oklahoma. No. i Inflationist of Congress. Next House Speaker Rainey flayed Hard Moneyman Sprague for flouncing out of Washington as a presidential ad- viser. Frank Arthur Vanderlip, ex-banker and onetime enthusiast for Technocrat Howard Scott, burbled his delight at the President's monetary experiment. To answer them up rose the fourth and last speaker, James Paul Warburg. 37-year-old vice chairman of the Bank of The Manhattan Co., himself no monetary conservative, who from March 4 to midsummer stood closest to one of President Roosevelt's many ears.

James Warburg, son of the late great Paul Moritz Warburg, no longer sees eye to economic eye with the President. Last week he poured polite but pointed damnation on the economic theories of the three who spoke before him. Mentioning money changers," Mr. Warburg said: "The first time I heard this phrase was when it fell from the lips of the President in his Inaugural Address. I did not like it then. . . . What is a money changer? If it is one who desired to change money, that is to alter money, then I wonder which one of us four is the greatest money changer. ... I can see that the good Senator does not accept my definition. Can it be that his is the scriptural definition? . . He [the money changer] was thrown out of the Temple not because his business was an evil business but because the Temple was not the proper place in which to conduct it. ... With him went those that sold doves." Looks passed at the speakers' table, and Mr. Wrarburg continued: "I can see from the gleam in the Senatorial eye that this again is not the Senator's definition. What he means ... is probably nothing more nor less than a usurer . . . more specifically . . . bankers-- preferably Wall Street bankers -- and most specifically of all ... Wall Street International bankers. Would you be very much surprised if I were to tell you that there is a certain Wall Street international banker who was for years the vice president in charge of the foreign department of one of the largest Wall Street banks, then president of a smaller bank, then a Wall Street in vestment counsel, and who now represents himself to be the intimate adviser of Senator Thomas? This is not hearsay. This man has stated not once but several times that not only is he Senator Thomas's ad viser, but that he helps the good Senator to write many of his letters and speeches. Perhaps, he has no right to make any such statement. ... If, on the other hand, he is telling the truth, I think it behooves 'the Senator to speak more softly and more reverently of money changers."

If anyone did not know the "international banker" referred to, Mr. Warburg told newshawks afterwards that he meant George L. Leblanc, onetime vice president of Equitable Trust Co., onetime president of Interstate Trust Co. (merged in 1930 with Chase National), now a director of American Machine & Metals, Inc., a "reformed" company known a few years ago under the name of Manhattan Electrical Supply Co. as a prize speculative stock. Mr. Leblanc promptly denied that he wrote Senator Thomas's speeches, declared that the Senator should be praised for taking advice from a man familiar with international finance. For the first time brought into the spotlight of the inflationist picture, Mr. Leblanc retorted: "Mr. Warburg is not hurting Senator Thomas's reputation by showing that he looks to men with financial experience to check economic facts. . . . Mr. Warburg assumes a great deal in attempting to act as spokesman for the banking com munity." But Mr. Warburg's speech did serve to show how closely the cohorts of inflation are knit. Inflationist LeBlanc is adviser, if not amanuensis, to Senator Thomas, friend and adviser of Father Coughlin -- and close ally of the "Committee for the Nation." Clearer & clearer has it become during the last two months that the inflationist forces of the country are firmly centred in this aggregation of Big Names. Among them are men who are known as speculators as well as men with good reputations as true industrialists.

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