Burr & Sop

There are five berths on the Securities & Exchange Commission, each with one vote. Ever since Commissioners J. M. Landis and J. D. Ross resigned few months ago (TIME, Sept. 27 & Oct. 25), there have been two liberals, William O. Douglas and

Robert E. Healy, and one conservative, George C. Matthews, holding down the SEC fort. It was, therefore, a foregone conclusion that whenever President Roosevelt got around to filling the two vacancies, he would appoint at least one out & out liberal. It was also pretty obvious after the present depression appeared that the other appointee might be a sop to Business. Last week these predictions were justified as Franklin Roosevelt sent to the Senate as his SEC nominees the names of a former braintruster and a prominent Wall Streeter.

Braintruster. Jerome Frank, a brilliant Jewish lawyer with an audacious tongue and a taste for abstract thought, has been successively a braintruster to Mayor Dever's Chicago reform administration, a satellite of such literary liberals as Sherwood Anderson and Floyd Dell, a protege of Felix Frankfurter and a crony of Rexford Tugwell. As general counsel for AAA he became such a burr under the New Deal saddle on conservative AAA Administrator George Peek that the latter finally resigned. When satirical Jerome Frank presently broke lances with Mr. Peek's successor, Chester Davis, the result was the reverse; Lawyer Frank was presently ousted from the AAA. After a sojourn with RFC and PWA, he journeyed north to Manhattan to work for the liberal legal firm of Greenbaum, Wolff & Ernst, where, aged 48, he still was last week when Franklin Roosevelt once more smiled upon him.

Wall Streeter. John Wesley Hanes was already in the news last week when nominated to the SEC, for the firm of which he is senior partner, Chas. D. Barney & Co., had just participated in one of the most important banking house mergers in many a moon (see p. 57). Quite the reverse of Jerome Frank, John Hanes is a Social Registerite who was born with a silver cigaret holder in his mouth, for his father helped found a big Winston-Salem, N. C. tobacco company which merged with R. J. Reynolds Tobacco Co. (Camels). John Hanes thus has many tobacco contacts which are of value in a brokerage business and into it he went after Yale (1915) and War (Navy). Chas. D. Barney & Co. is rated an authority on tobacco stocks and Broker Hanes is said to scowl upon any visitor who dares to smoke anything but Camels. Genial John Hanes was one of the founders of the New York Tobacco Exchange, has a $1,500,000 estate at Rye. likes to race his own horses. A onetime governor of the New York Stock Exchange, he has a vague reputation in Wall Street as a "liberal," partly because he refused to run for president of the Exchange, partly because Chas. D. Barney & Co. is known as a progressive firm. His elevation to the $10,000-a-year job on SEC means he must give up all his Wall Street positions, his directorship in some 30 corporations and his Stock Exchange seat. Transfer tax alone on the latter will be $4,000. But, as the first Stock Exchange member ever to be offered an SEC Commissionership. Broker Hanes delighted Wall Street by hesitating not a whit in accepting. Queer World? Said Broker Hanes: "Though a Wall Street man, I was previously in the manufacturing business and have always thought of Wall Street in terms of its importance to business. For that reason I heartily subscribe to the recent statement of Chairman William O. Douglas on the need for reorganization of the New York Stock Exchange in order that it may assume a greater public responsibility. ..." (see p. 59).

Said Lawyer Frank: "It has been and is the policy of the Commission to protect the interests of the public by seeking to establish relations with the Exchanges, founded on basic horse sense and intelligence, with the least possible friction, a minimum of red tape and complete candor from all parties. I heartily subscribe to that policy and, if my appointment is confirmed, I shall do my utmost to carry it out. . . ."

Surveying this somewhat startling juxtaposition of viewpoint, the Financial Reporter remarked: "This is a queer world-- or it will be if the 'Wall Street representative' on the Commission proves the radical and the New Deal braintruster the conservative of the new appointees."

This file is automatically generated by a robot program, so reader's discretion is required.