Vol. 88 No. 10

The Aldrich and

Fowler
Currency Bills

Mr. Fowler, of New Jersey, Chairman of the House Committee on Banking and Currency, has introduced in Congress a currency bill which has been favorably reported out of the Committee. There are now, therefore, two currency measures for the immediate consideration of Congress at this session-the Aldrich or Senate Bill and the Fowler or House Bill. The Outlook believes that it is unquestionably for the best interest of the country that the Fowler Bill should be abandoned and that the Aldrich Bill should be passed. We shall endeavor to state briefly our reasons in this paragraph. The banking currency of this country is at the present time an inelastic, bond-secured currency. While it is true that our currency and banking system, as Mr. Carnegie pointed out in last week's Outlook, is in some respects one of the most artificial, unscientific, and unpractical in the world, the immediate pressing need for the country is not an entire revolution and reconstruction of that system, but the introduction into our banking currency of the quality of elasticity-that is to say, we ought at once, in order to meet the needs of commercial, agricultural, and manuacturing business, to provide a method by which the volume of banking currency in the country may increase and contract with the regular bi-annual increase and contraction in the volume of trade. The Aldrich Bill practically and simply provides such a method which may be incorporated in or added to our present long-established system of bond-secured currency. Mr. Fowler's bill, on the other hand, if passed, would mean a complete and radical revolution of our present National banking currency methods. It wipes out in one stroke the use

$3 a year 10c. a copy

of Government bonds as the basis for circulation; it provides for a guarantee of all deposits; it permits National banks to do the business of trust companies; and it makes several other important changes of detail in National bank management which need not be recounted here. We agree with Mr. Fowler that our present bond-secured currency is archaic, that an asset currency like that which works so successfully in Canada would probably be much more desirable, and would doubtless, if it could be adopted, provide a greater degree of elasticity than that which will result from the Aldrich plan. But, in our judgment, Mr. Fowler's bill is absolutely impractical to-day because it cannot be passed. Whatever the defects of our bond-secured circulation, the country, both by education and by long usage, is convinced that to abolish it after a month's debate is unreasonable. The Outlook urges the passage of the Aldrich Bill because it enlarges the scope of our present system and provides for elasticity without any jeopardy of safety. It is purely an expedient, to be sure, but an expedient is what is immediately needed. With the simple and safe elasticity of the Aldrich plan adopted, the country can then very properly and without anxiety turn to a discussion of the question whether it does not wish ultimately to abandon totally the present system and construct one along the lines proposed by Mr. Fowler. This, however, cannot be done in a brief Congressional debate. The question of an entire reconstruction of American banking and currency should have the painstaking consideration of a commission of experts who should make a complete report to Congress; of this commission Mr. Fowler might very well be the chairman,

wash, estimated at about a billion tons. The greater part of this comes from the richest portion of our farms. We may well remember the double loss, first to the farms and then the burden to navigation by the consequent formation of bars and shoals. Out of the Mississippi alone goes every year much more earth in the form of sediment than we are to take from the Panama Isthmus in order to construct the Canal.

Again, a waterWhat Waterways Mean way is valuable to Industry and Defense at its rapids for the storage of water power as used for operating mills before the introduction of electricity, or, now, also for the generation of electric power. As President Roosevelt says: "It is poor business to develop a river for navigation in such a way as to prevent its use for power, when by a little foresight it could be m le to serve both purposes. We cannot afford needlessly to sacrifice power to irrigation or irrigation to the domestic water supply, when by taking thought we may have all three." If we have not realized the many ways in which a waterway is valuable for health and agriculture, neither have we realized that it may conserve our mineral resources, that its use in transportation instead of by rail saves iron and steel; furthermore, that its use as water power saves coal. We cannot have water for either of these uses unless we have forest protection, and this, of course, saves timber. Under these circumstances the introduction of bills to provide for the largest use of our navigable waters by all the people should receive the careful attention of Congressmen.

But they should as vigorously condemn any bills suggested by companies desiring to control any part of our waterways without compensation to the public, and to escape Government regulation. Finally, waterways are valuable for the National defense, especially the deep channels along the Atlantic and Gulf coasts and from the Gulf to the Great Lakes. Thus waterway improvement should be begun at once, and the various waterway uses, regarding health, domestic and municipal supply, naviga

tion, the various agricultural and manufacturing resources, and, finally, National defense, should be developed at the same time. As a first step, Congress should authorize the President to bring together the bureaus in the Departments of War, the Interior, Agriculture, and Commerce, dealing with the various waterway uses. Otherwise there will be delay, and while we delay, the country's natural resources, as the President says, are being absorbed by great monopolies. The President refers with particular emphasis to the dangers of private control of water pow

Brownsville Again

For futile discussion of a closed case the Brownsville affair promises to become worthy of historical record. Here it is a year and a quarter after the President, as Commander-in-Chief of the army, decided to dismiss three companies of the Twenty-fifth Infantry; and yet the Senate Committee on Military Affairs only last week passed resolutions on the subject. The Committee, by a vote in which party lines were confused, upheld the President. Although on several resolutions the division was eight to five, only two of thirteen members of the Committee declared by their vote that they believed that no soldiers of the Twenty-fifth Infantry took part in the shooting affray; and even one of these two later declared by his vote that the evidence showed that the shots were fired from the soldiers' rifles. That this matter has been kept agitated is due to Senator Foraker. There is too much political fertilizer in this subject for him. to abandon it even now. It has helped him to cultivate the political loyalty of a certain class of negroes who confuse fidelity to their race with a blind support of anything that any member of their race does. It has helped him to cultivate, too, a welcome tolerance in a certain rather naïve portion of the

press which on other subjects has been disposed to be intolerant of him. It helps to consolidate opposition to the President; and in the eyes of some earnest people that would justify almost anything. We may expect, therefore, the Brownsville incident to be kept alive. It is astonishing, however, to find how persistent is the idea that the action of the President in discharging the negro troops was a punishment. Of course it was not; and most of those who affect to treat it as such know that it was not. It was an order by the Commander-inChief for the good of the service, and for the maintenance of confidence in the army.

A Victory

Immeasurable in its con

for Posterity sequences, laden with vast potential benefit to the entire country for generations to come, the decision of the Supreme Court of the United States in the Curt Muller case might well be celebrated with a great demonstration. There have been military victories acclaimed with the ringing of bells and with bonfires that have had no more significance for the future of the land than this sober decision. It is, in brief, that American women can be protected by law against commercial greed. The case was epitomized in The Outlook for February 8. A laundryman denied, on Constitutional grounds, the right of the State of Oregon to put other limitations on the hours of labor for women than it put upon hours of labor for men. The Supreme Court of the United States now declares, for the first time, that a State has that right. Although nominally a Constitutional question, it is really a vast social question that the Court has answered. It declares that in contractual rights women stand on the same plane as the other sex. This is the Constitutional aspect of it. But the State has the Constitutional right, for the public good, to limit the contractual rights of the individual. The question then becomes one of fact: Is the special protection of women by limitation of contractual rights for the public good? It is this question which was effectually answered by the great array of testimony marshaled. by Mr. Louis D. Brandeis, of counsel for

the State of Oregon. So effectual was this that it appears epitomized in the opinion; indeed, it was apparently the determining factor in convincing the Court. This testimony the Court declares to be "significant of a widespread belief that woman's physical structure, and the functions she performs in consequence thereof, justify special legislation restricting or qualifying the conditions under which she should be permitted to toil." Though" constitutional questions . . . are not settled by even a consensus of present public opinion," yet the Court holds that "when a question of fact is debated and debatable, and the extent to which a special constitutional limitation goes is affected by the truth in respect to that fact, a widespread and long-continued belief concerning it is worthy of consideration." That statement, by the way, lays down a principle which has an application far beyond this case; it is a principle that will be invoked with increasing frequency as complex social conditions of modern life call for new Constitutional interpretations. Applying that principle in this case, the Court affirms that "as healthy mothers are essential to vigorous offspring, the physical well-being of woman becomes an object of public interest and care in order to preserve the strength and vigor of the race." On account of her physical constitution," she is not an equal competitor with her brother." In spite of the removal of legal and other disabilities, "she will still be where some legislation to protect her seems necessary to secure a real equality of right." Such legislation to defend woman, to use the Court's phrase, "from the greed as well as the passion of man," is not merely for her benefit, but for the well-being of the race. The opinion (which was delivered by Mr. Justice Brewer) virtually reaches a conclusion as follows:

Many words cannot make this plainer. The two sexes differ in structure of body, in the functions to be performed by each, in capacity for long-continued labor, particu the amount of physical strength, in the larly when done standing, the influence of vigorous health upon the future well-being of the race, the self-reliance which enables one to assert full rights, and in the capacity to maintain the struggle for subsistence. This difference justifies a difference in