HARDWOOD RECORD 



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nnselfish advice than perhaps any other class of organizations, and 

 more intelligent counsel, but it has ahvays been considered by the 

 other fellow to whom the advice has been given that it arises from a 

 seltish interest, for selfish purpose and to gain or achieve a certain 

 selfish end. 



The San Francisco Chamber of Commerce may appeal to Congress 

 for that legislation, national in character, which will benefit the state 

 of California, or the city of San Francisco, but that appeal from San 

 Francisco will be taken with the same grain of salt and will be 

 tainted with the same claim of selfishness. Your association and all 

 trade associations alike in the claims which they make for considera- 

 tion have that one common enemy of all organizations, the public 

 opinion, created unjustly and unfairly in the main, which has for its 

 basis of argument the selfishness of the request made. And there 

 is no possibility of gathering together these respective units that rep- 

 resent the commerce of the country, unless you form a national organi- 

 zation as the ultimate refinement of the community and the trade 

 organizations representing all business interests and permitting the 

 American business men to speak as a unit upon the questions which 

 are not local, which are not devoted to a single trade, but which 

 absolute!}' are national, and yet in their national character as inti- 

 mately relate themselves to your business and mine, as though they 

 were a part and parcel of our daily life. 



That is the reason, gentlemen, that in the national conference that 

 was called in April, 1912, orders were given to create the Chamber of 

 Commerce of the United States, in order that the business men of 

 this nation should have one organization through which they might 

 speak on the broad questions of our day, concerning which I wish to 

 invite your attention for a moment. 



I am not a pessimist, but rather my contact with men over this 

 entire country leads me to believe that pessimism has no place in the 

 business world and no place in the business mind ; but I believe that 

 today this country faces a definite crisis, very different from the crises 

 of the past, in that it has nothing to do with the acquisition of ter- 

 ritory or the laying of foundations of the government, or of the 

 building of a constitution, or the freeing of the enslaved portion of 

 our people, but just as definite a crisis as any crisis that has con- 

 fronted the American people in the past. It is economic. Therefore 

 it is your problem. It confronts the nation today so strongly and 

 strikes so sturdily! at the foundations of business that unless the 

 problems are solved, progress and prosperity and a continuation of 

 the splendid history which this country has made will stand absolutely 

 still and tben begin to retrograde; for you cannot neglect further 

 these problems which strike so intimately at the commercial develop- 

 ment of our country and which, in the last analysis, if allowed to go 

 unchallenged, will set up ilefinitely two camps, one against the other, 

 that of the employer and that of employe, out of sympathy with each 

 other, out of harmony, out of touch and out of contact, believing 

 that unfair methods prevail, and will therefore invite revolution that 

 would be very detrimental to all of our commercial interests, and to 

 our government as well. 



The test of the permanency of a democracy such as we have estab- 

 lished on these shores lies in a right solution of these economic ques- 

 tions that during the last ten or twenty years have multiplied and 

 pyramided without a solution, until today we have them by the dozen, 

 and it is absolutely necessary that we should consider them and 

 endeavor to solve them. To my mind they group themselves in 

 three sections: There are the economic problems purely; there are the 

 trade problems purely, and there are the social problems. 



I want to speak to you in a very brief ' way of three, under each 

 head. Of the economic problems the three are these: The regulation 

 of our domestic commerce and the control of our domestic corpora- 

 tions; the revision of our banking and currency laws, to provide for 

 flexibility of currency and of credit, and a method for the revision of 

 our tariff from this time forward that shall be scientific, based upon 

 the experience of other nations older than we in this particular thing 

 and calculated to do away with the unrest, the uncertainty and the 

 loss which result from the constant and repeated threats of radical 

 revision such as we are undergoing at the present time. Those are 

 the three general economic problems that are business and yet they 



are political in that every single one must be solved by legislation, 

 and who is going to write the bill? 



Our Congress is made up very largely of men in professional life. 

 Are they competent to determine your problems? Are they competent 

 to judge without your counsel and advice how far they may go in 

 safeguarding the interests of the people as against the commercial 

 interests without undermining the very business which you are doing 

 and which you own? No. Neither is it right that we, as business 

 men, should expect the Supreme court of the United States, chosen 

 not for the purpose of sitting as judges over common, ordinary busi- 

 ness disputes, to be compelled to interpret the Sherman law and its 

 actual operation or application to every industry to which it is applied. 

 It should be its business to construe much higher and weightier 

 problems relating to government, our nation and our relation to the 

 other nations of the world. We must have a revision either of opinion 

 or a writing of a brief that business men may run and read, or an 

 amendment of the law which regulates our domestic corporations to 

 a point that they shall not be jeopardized, either in the conduct of 

 their domestic business or in competition with great foreign corpo- 

 rations in the markets of the world. And that law will 

 be written in December or during the winter of 1913 and 1914, in the 

 regular session of Congress, and it is your problem as to whether 

 that law shall be wisely written, under your counsel and judgment 

 and advice, or whether you will allow, as we have so often done in 

 the past, our professional friends in Congress to make the law and 

 then suffer under it until it becomes unbearable. 



The banking and currency question is your question. I am a banker 

 by profession, and while business men uniformly over this country say 

 that is a banker's question and the banker should settle it, I say to 

 you it is not a banker 's question. That it is your question and 

 it must be settled in your interests or it will be settled 

 in a nmnner that will be inimical to your interests. The 

 banks can get along. We will operate under the law; we will build 

 up our reserves, anticipating times of trouble; we will hold our 

 funds available for the use of our depositors and for their demand, 

 when that demand comes. If we have a circulating medium that is 

 sufficient to answer all purposes, well and good, but if that circu- 

 lating medium falls below the safety point, the bank is not going to 

 be hurt. You are going to pay a price for your money or you are 

 not going to get it at all, and your business will be curtailed because 

 of the absolute inflexibility of our present banking system. Has it 

 answered our purposes for fifty years! Yes, but fifty years ago this 

 nation was not the nation that it is today. Fifty years ago it 

 answered a purpose because we had government bonds in plenty, owing 

 to the rapid changes that have come about, and to the expenditures 

 that have been made to settle our national conditions, and today you 

 are faced with an absolute shortage of currency because the medium 

 upon whic-h additional circulation is based is so limited as to be abso- 

 lutely unobtaiuable. 



What are you going to do about it? What is the asset upon which a 

 flexible currency and a flexible credit may be founded? It is abso- 

 lutely and only the commercial asset, the movement of goods in 

 transit, the movement of goods in the warehouse, the storage of 

 goods upon your shelves and on the road. That is the thing that is 

 the basis of national wealth, flexible in character, converting itself 

 quickly into money, and in good times and bad times infinitely more 

 rapidly into bonds and stocks, infinitely more certainly, upou which 

 circulation may be based. 



The bill which is in Congress today, or will be there, I hope, in the 

 month of June, will provide for that flexibility in that commercial 

 paper and bills of exchange of certain classes and having a certain 

 length of time to run may be discounted through the source created 

 b.y law, and the bank having greater demands upon part of its cus- 

 tomers than can be supplied out of its own resources, may be able to 

 take its paper of the class stipulated in the law, rediscount it and 

 supply the wherewithal to carry on the business of the community. 



Do you say that will work an expansion that will be dangerous? 

 No, it will not, for the only discounts that should be taken are short- 

 time discounts, and they must be retired at maturity and they must be 

 paid in the same character of notes that are issued, as the result of 



