The state banks have been a very important factor in our banking system.  They were able to organize with a smaller capital, in the smaller communities.  All that seemed necessary was for some one to hang out the sign BANK, and the people would hand in the deposits with which to do business.

The number voluntarily reporting to the Comptroller of the Currency in 1915 was 14,598, a net increase during the year of 86.

The total capital was $503,985,319.

The total number of national banks at the same date was 7,805 with a capital of $1,068,519,000.

The state banks being chartered by the several states were independent of the national banking system, and in competition with them.

This was possible, so long as the federal government exercised its constitutional power to coin and issue money.

Section 2 of the Aldrich plan provided that “only banks of the classes hereinafter provided for may subscribe to the capital stock of the Federal Association.”

The state banks were a very important body, and their political influence was needed to secure the enactment of the law.

Mr. Reynolds was put forward to make the bid, and he painted a very attractive picture of the great advantages of the system, and also the imminent danger to the fraternity if it were not enacted.

The joining the Reserve Association was to be entirely voluntary.

Everything to gain, if it looked good, and nothing to lose if unsatisfactory, and they all fell for it.

Mr. Reynolds made the definite statement that “when the law is finally it will provide that

  State Banks Discover The Trap 277

state banks shall participate.”  How was this promise kept ?

Section 9 of the Federal Reserve Act uses the word “may” instead of “shall,” and leaves it wholly optional with the organization committee of the Federal Reserve Board, and provides :  “No applying bank shall be admitted to membership in a Federal Reserve bank unless it possesses a paid-up unimpaired capital sufficient to entitle it to become a national banking association in the place where it is situated, under the provisions of the national banking act.”

The Federal Reserve Board provides, Reg. M., June 7, 1915, in part :  “(2) It must have a minimum paid-up unimpaired capital stock as follows :

“In cities or towns not exceeding 3,000 inhabitants $25,000.

“In cities or towns exceeding 3,000 but not exceeding 6,000 inhabitants, $50,000.

“In cities or towns exceeding 6,000 but not exceeding 50,000 inhabitants, $100,000.

“In cities exceeding 50,000 inhabitants, $200,000.”

The other regulations are very rigid.  They must absolutely surrender their independence to the Federal Reserve Board.

Section 9 at once rules out more than 6,000 state banks, with less than $25,000 capital and a very large majority of the balance because of the rapidly graduated increase of capital required.

First Annual Report, page 20, says :  “Those state institutions which have already been admitted to the system have entered upon the understanding that they are to accept any regulations the Board may make regarding the conduct of the business of member banks.”

Is it any wonder that up to December 31, 1915, only thirty-two state and savings banks had joined the Association.

Had it been made voluntary for the national banks as was promised by Mr. Reynolds, I doubt if the proportion of national banks joining the Association

278 Conspirators Growing Impatient  

would have been much greater than that of the state banks, which was at the beginning of 1916 just about one to 455.

It is not surprising that the independent state banks refuse to surrender their independence.

Nor is it surprising that the conspirators are growing impatient.

Private Monopoly Insists on One System

Private monopoly will not tolerate opposition, competition, or independence.  They demand strict obedience.

Their plan provides for one system only, and that a bank ledger credit system, under their supreme, autocratic control.

Federal Reserve Board Circular No. 14 :  “A unified banking system, embracing in its membership the well managed banks of the country, small and large, state and national, is the aim of the Federal Reserve Act.  There can be but one American credit system of nation-wide extent, and it will fall short of satisfying the business judgment and expectation of the country and fail of attaining its full potentialities if it rests upon an incomplete foundation and leaves out of its stockholders any considerable part of the banking strength of the country.”

W.P.G. Hardinge, a member of the Board, said at the Waco, Texas, meeting May 15, 1916 :  “I am violating no confidence when I say that the Federal Reserve Board desires earnestly to have the state banks become members of the Federal Reserve system.  The Board feels that the membership of the state institutions is essential to the coordinated banking system that it wishes to establish, and realizes that there can be but one credit system of nation-wide extent.”

And he concludes with a strongly veiled threat of an emergency in which they may need aid, but will not receive it.

October 15th, in Minneapolis, Mr. Warburg was much plainer in his persuasion and threats.  The sys-

  Warburg Threatens Panic 279

tem that was to prevent panics, and financial troubles is discredited by its sponsors.  There is a grave danger unless the state banks that can come in, refuse to do so.  As for the 6,000 odd little fellows—let them perish.  They are not even good fish bait.

He said in part :  “Let me ask those of the state institutions that are proud of their independent standing :  Is it quite fair to let your neighbors pay for the expenses of the fire department when, in case of fire, you know you will count on the benefits of the general protection.  Let me tell them, at the same time, that insurance companies are generally willing to take risks while applicants are young and conditions serene, but are not very eager to write new insurance when the ‘quake’ is on.”

Note.—There never was to be another “quake.”

“The thought is often expressed that ‘at the time of the next crisis the state banks will come in.’  I think it may be safe to say that they will find that many will then come in after the next period of anxiety.  This is not meant as a threat, but I am afraid it will be a physical impossibility to take them all in during such a period of stress.”

Then, on the confession of the author of the Federal Reserve Act, speaking for the Federal Reserve Board, to Federal Reserve bank officers, the Federal Reserve bank system is a miserable failure and in no sense a protection against “periods of anxiety,” “financial stress,” “panics and quakes.”

To accomplish their aims the panics will come as usual.

Will the State Banks Be Coerced ?

Under the present law and system, it is only a question of a very short time when the state banks will be forced out of business by starvation.  Their only hope is to help us change the system before it is too late.

The state bank is wholly dependent on the deposits of money by its customers.

280 State Banks to be Coerced  

The present system means a complete change from money to credit, and is in very rapid development.  See page 64.

The plan of the system is to retire all currency, except a small amount of Federal Rserve notes for counter use, and in five months, since February 1st they have contracted the volume by $42,201,550, or about one-fifth.

To demonetize and retire as much of our lawful money as possible and hoard the balance in their own vaults, for the final climax aimed at.  See pages 77, 92 and 123.

Now, how long can state banks do a banking business on a rapidly vanishing volume of money.  How can they do banking business on their competitors’ ledger credits.

The system will show no mercy to the state banks who refuse to “walk into their parlor.”

As will be noted by the quotations, the officers of the Federal Reserve system are discrediting the state banks in a very serious manner.

Casting grave doubts as to their ability to stand the tests that are sure to come, and without help from the system.  What effect will such declarations have on the public ?  What effect was intended ?

As an illustration, take the report of the Minneapolis Daily News in its review of the Minneapolis banks’ statements for March 7th and May 1st as gathered from such bankers as H.R. Lyon, President of the Scandinavian National, and E.W. Decker of the Northwestern National.

The review reads in part :  “A sensational increase in savings banks deposits in Minneapolis amounting to nearly $700,000 since March 7th, according to bankers, was the outstanding feature of a bank report made to the government today.  Deposits in state banks fell off nearly $800,000, and barely held their own in the national banks.”

That is the logical effect of such a campaign as is

  State Banks Discredited 281

being made by the chief officers of the Federal Reserve bank system.

$800,000 withdrawn from the state banks, to deposit in other banks in one city, in less than two months might not be so very significant if it were not so prominently advertised, but advertised as it was, was sufficient to start a run on the state banks, and shows, in part, what the state banks may expect from the national banks.

Again there seems to be a very general effort to antagonize and interfere in securing state legislation to cripple the lending power of the independent state banks.  There will be persecution in the courts.  All of these things will give an opportunity of discrediting the stability of the state banks and creating doubt in the minds of their customers.

Another significant sign of their intent to crowd out the state banks is in the recommendations of the Federal Reserve Board for amendments to the Federal Reserve Act, 1915 report, page 22 :  “Permission should be granted to national banks to establish branch offices within the city, or within the county, in which they are located.”

It would not have been safe to have included this in the original bill, as it would have alarmed the smaller national banks and all of the state banks, but now it is perfectly safe and the amendment will be adopted.

This is not only a threat, but an additional means of putting the independent state banks out of business.  I do not see how they can for long compete with the branch of a national bank in any small community.

First, they must depend upon the customers’ money deposits with which to do business, and as shown we have practically ceased to coin or issue money, and what we have is being rapidly retired, or demonetized.  So there will be less and less of money in circulation to deposit in state banks.  Second, the state bank cannot loan its credit; it must limit its loans to a certain

282 Branch Bank Competitors  

percentage of its money deposits, and with a powerful opponent in control of our legislative machinery, they will insist, as they are now doing, that the state banks must keep larger reserves on hand than the national banks need to do.

Third :  The national bank branch can do business without money deposits.  It can loan the credit of the parent bank, for which it will have to pay neither tag nor interest.

These will be the conditions for competition, as between the state banks and national banks.  Without a change it is easy to see the result.

Most of the stockholders in state banks are interested more in other business relations than in banking, but even from the banking standpoint they should unite with us in changing the system.

In fact, so far as personal interest is concerned, it is as one against ten thousand, and the object of this work is to show the ten thousand the danger, and the way out.


As the present Federal Reserve bank system was not intended for, and is not being operated for public service, but solely for private profit, the issue should be a repeal of the whole private monopoly system, and replace it with a government system, a real public service system “for the common welfare—for the good of all.”

There should be no discrimination as to different sections of the country.  The rate of interest should be fixed by a people’s Congress, and be uniform in all parts of the nation, as is the case with our postal system.

Why should this public utility, money, at times go begging in New York for two per cent ;  in Chicago for three ;  in Minneapolis for four, and at the same time the farmers of the West and South be begging for it at ten to twenty per cent, and charged up to 2,400 per cent ?

Why should we penalize the pioneers who go out in the wilderness to carve out new homes by developing the country, to the great advantage of the older settled portions of the country ?

It is a very poor way to encourage the development of our millions and billions of acres of yet undeveloped lands.

In organizing for our commercial banking system, we should to some extent use our present political units, as suggested for an investment system, changed to suit the commercial convenience.

I do not see any reason for a new department, with delegated constitutional powers, such as the needlessly expensive Federal Reserve Board and Federal Reserve banks ;  or the later Land Loan Board for rural credits.  The high priced, financiers are those who have shown the ability to make the greatest profits, regardless of the ethics of the transaction.  In this case the

284 Commercial Banks  
private profits would be eliminated.  It would be just good, safe, business service, under regular rules established by Congress and state legislatures.

The position would be no more responsible, or require greater ability than is required of city or county treasurers, city postmasters, collectors of customs duty or internal revenue, or receivers of railroads.

For convenience there should be a state bank in each state, in place of the Federal Reserve banks.  The federal government should charge one per cent per annum interest, or tax.

As the Treasury Department would have only about fifty correspondents to deal with, the expense would be comparatively small.  The revenue derived from the interest in excess of the expense, should for a time be set apart as a reserve fund, until such time as there was sufficient for all reasonable protection, and thereafter to become a part of the general revenue.

The state bank should also receive one per cent per annum interest.  Its business should be similar to that of the Federal Reserve banks, to deal with the local banks.  All receipts in excess of the expense of administration should be placed in a reserve fund for protection, until a sufficient amount for all reasonable security had been accumulated, after which in compensation for state guarantee, all excess receipts should be turned in to the general state funds.

The local banks should be banks for deposits as well as loans.  Local co-operative banks should be especially encouraged.

As service, rather than profits, would be the aim, they could pay two per cent for deposits and loan at four per cent.

When they discounted paper with the state bank they would get the money at two per cent, thus leaving a margin of two per cent.

These are simply suggestions, to be changed in accordance with experience ;  but to start with it would give loans for industrial and commercial purposes for four per cent.

  An American Banking System 285

Our independent state banks might be used to begin with, and continued as such, so long as satisfactory.

This would give us a truly American banking system, without private profit, the very best in the world, with a uniform, maximum rate of interest established for commerce, the lowest in the world.

This should be quite satisfactory to the smaller, independent business men and manufacturers, for it is inevitable that the object of the present system being profits, the national (member) banks will follow the example of the head of the House, and insist on a controlling interest in the business they finance with their credit.

This should also meet with the earnest support of those who favor building up a foreign trade, in which our two greatest drawbacks are high rates of interest for the use of money, and excessive rates for transportation as compared with those of our competitors.


Just how an American citizen can read the story of this great conspiracy and not be stirred to action is beyond comprehension.  This is where the “red blood” we read so much of should show itself.

The system to enslave the whole labor of the nation was conceived with satanic cunning at a time when the nation was desperately trying to overthrow the chattel slavery of the colored man.

On the sound human theory that “no man was good enough to own the labor of another man” we freed the colored man, and have now transferred the legal power to a few men to control the labor of all our people, by a control of the money of the country.  This control has been accomplished, legally, step by step, with cruel efficiency, under cover, or promoted under false pretense and misrepresentation.

It began in 1862 when a small group of bankers, having cornered the gold of the country, forced the government to discredit its own obligations to make a market for this gold.  (See page 211).

In 1886 they substituted a currency, which was money for the bankers, but not for the people.  (See page 211.)

In 1873 they began to discredit silver, our original unit and standard of value.  (See pages 125, 206-207.)

In 1882 they began substituting currency certificates, which was money for the bankers, but not for the people (p. 74) and continued it.  See pages 75 and 208.)

In 1911 they began demonetizing gold by decoinage.  (See page 203.)

They are rapidly contracting and retiring both money and currency from circulation to increase the value of the dollar ;  increase the rate of interest, and force bank credit borrowing, instead of money.

See pages 48, 121, 123, 125.

    Unpatriotic American Sacrifice 287

They now have the legislation to give them a complete, perfect monopoly of money.  See pages 89-90, 93, 117-118.

They are accumulating our gold for foreign investment, immediately after the close of the war “to make their fortunes over night.”

This is a premeditated sacrifice of American industry by these selfish, disloyal citizens for their own private gain.  See pages 136 to 142.

They are now, and have been in the recent past, giving the preference to foreign investments over domestic investments.  See pages 140-141-142.

In any real public service they would be promptly fired.

“Agriculture is being made the special victim of inhuman greed and extortion by national bankers.”  See pages 24, 176, 163, 215.

Comptroller of the Currency pleads for legislation to enforce our banking laws, but Congress dares not act.  See pages 25-26.

Both the Republican and Democratic parties were solemnly pledged to place agriculture on an equal footing with our competitors in foreign countries, and any other business in our own country, and shamefully betrayed the farmer, and in addition set a dangerous trap for him.

See pages 194 to 201 and “Dangerous Trap,” page 175.

The conspirators are strictly non-partisan and accomplish their ends under cover by deception, deceit, misrepresentation, corrupt practices, or panics.  See pages 91, 120.

One noted exception of frankness by Senator Aldrich at Chicago, and that resulted in the retirement of their great leader.  Page 109, 119.

They are no respectors of persons, or official positions.

When a political party, or a public official, accepts of their financial assistance, they are in their toils, and must obey, or be destroyed by exposure.  Neither

288 Deceived 25 Times in Succession  
Congress, the Judiciary, nor Presidents of the United States are exempt.

For proof of recent administrations specially treated of in this book :

For President Roosevelt, see pages 88-89, 95-96, with the climax on page 106, and the finale, the desertion of the Progressive party at the command of Perkins of the House of Morgan.

For President Taft, see pages 89 and Herrick’s tribute, page 198.

For President Wilson, see pages 114-115, 197-198.

There is no parallel in the world’s history, where a nation of free citizens have willingly, legally and enthusiastically placed themselves in voluntary servitude to a group of deceitful, unreliable, unworthy, disloyal, selfish oppressors.

The Republican and Democratic parties have held their 1916 national conventions, and each has unanimously “pointed with pride” to the legislation giving the House of Morgan this great monopoly in violation of the spirit of our constitution.

If a man deceives you once it is his fault ;  if he deceives you a second time, it is your fault.  The same should be true of political parties.  Both dominant parties have now deceived the American voters twenty-five times (fifty years) in succession and are preparing to do so indefinitely, so long as you support them.  Why not ?

The Democratic and Republican parties are financed, owned and controlled by private monopoly.

Four revisions of the tariff ;  two by each, have favored private monopoly.

Tell me in advance of an election what interest, or interests are financing the campaign of an individual, group of individuals, or political party, and I will tell you what their record will be if elected.

They pay no money until assured of service.

They are not publicly known in the transaction, for such publicity would defeat them.  In fact they will emphatically, publicly and officially deny such aid.

    The Organized Farmers Ignored 289
As an illustration, recall the official denials before the 1904 presidential election, and the Roosevelt-Harriman correspondence after the election.  See pages 95-96.

There was nothing unusual about this episode, except the publication.

In conferring a monopoly of money on the system, they have vied with each other.  For the two most important measures, changing to the gold standard, and from government money to bank credits, the Democratic party has the credit.  Practically in all else the credit must go to the Republican party.  In the past three years it has been non-partisan, almost unanimously.

A vote for any candidate, for any office of either party is a vote to perpetuate monopoly control.

On the theory that “something must be done for the farmer” they unite on a fake rural credit act with a land loan board of five members to govern and control.  The organized farmers asked for a representative on the board, and they were ignored.

Served them right.  Instead of begging for one representative, they should have demanded a majority of the board.


The bi-partisan representative system of government has proven an utter failure for the people, and a complete success for private monopoly.

Then it is up to the people who have suffered to change the system.

Popular government, the initiative, referendum and the recall would give us the opportunity, but we in South Dakota, the first state in the Union to adopt the initiative and referendum, have seen how easily it has been nullified by a political party, controlled by private monopoly, in control of the legislative and judicial machinery of the state.

The Prohibition party is right in claiming that prohibition to be successful must be administered by a government in favor of the principle of prohibition.

The Socialist party is right when they claim that public ownership of public utilities would be a failure

290 Direct Congressional Control  
administered by a government controlled by private monopoly.

What better illustration do we need than the alleged regulation and control of our public highways—our railroads—by a pro-railroad Interstate Commerce Commission ; or

The government control of our monetary system by a Federal Reserve Board, controlled by the House of Morgan ;  or

Private monopoly and trust busting as it has been administered ever since the enactment of the Sherman anti-trust law, by trust controlled officials.

There are several issues large enough and important enough to warrant the organization of a national political party to secure their enactment and enforcement.  Some of them can be, and are being gradually and progressively enacted by state legislation, and will be finally and fully solved by national constitutional amendments and legislation.

The one overshadowing issue, that of the private control of the transportation, distribution and exchange of the products of labor cannot be solved by state legislation.  It is a purely national problem.

I herewith submit a base which was adopted by the National Farmers’ Alliance and Industrial Union twenty-one years ago at Washington, D.C., which is broad enough to cover the whole private monopoly ground, and upon which every independent American citizen should be willing to unite.

“Whenever any public utility or necessity becomes a monopoly in private hands, the community, small or large, should take possession of same by right of eminent domain, paying a just value therefor, and operate same in the interest of the whole community.

"Whatever any community, large or small, can do for the individual members of that community, more economically and efficiently, than the individual members thereof can do for themselves, the community unit should do, whenever a majority of the voting units so decide.”

    The Paramount Issue 291

There can be no question as to the fact that our medium of exchange is now controlled absolutely by a private monopoly, charging exorbitant rates of interest.

It is also an incontrovertible fact that any charge for the use of this public utility, in excess of the cost of administration, whether it be for the medium—money—of the transmission of intelligence by mail, wire, wireless, or phone ;  or for the transportation by rail or water, or in the distribution of the products of labor, is a tax on labor and must be paid by the producer, or consumer, or by both.

The paramount issue then should be to stop this unnecessary and unjust system of taxation and provide a system to be administered without private profit.

Every special privilege, carrying with it the power of taxation, direct or indirect, is at the expense of the whole state, and the more indirect the more expensive.

Where and How Begin.

We must stop the further contraction of money in circulation.

Stop the further demonetization of money by decoinage.

Make every dollar coined, or issued by, or being an obligation of the government, lawful money, a full legal tender for all debts, public or private ;  in lieu of the present indefensible system of issuing a sham, deceptive pretense for money and which can be used as money by the bankers but not by the people.

Repeal the Federal Reserve bank law and all special privileges connected with the administration of public utilities.

We should provide for a medium of exchange that would respond automatically to demand for use.

We should encourage home development, and discourage foreign investments by American citizens.

We should have a fixed national policy that whenever or wherever any American citizen makes an investment abroad, for the development of a foreign

292 Good Citizenship  

country, he should look to that country for the protection of that investment.

That used to be international law, and is good common sense.

How to Accomplish.

There is only one way to accomplish this change of system, and that is by a union of all those who are opposed to the private monopoly of public utilities into one National Party with that as the paramount issue.

It is immaterial what the name of the party may be.

The party must be free from any shadow of dependence on, or of being financed or controlled by any beneficiary of special privilege.

It must be openly financed and supported by the people for whose benefit it is intended.


To be a good citizen is not alone that you should be industrious, self-supporting, law-abiding and a good neighbor.  You may be all those and yet not a good citizen in so far as the duties you owe yourself and the community you live in.

Definition :  “The status in a free state of a person possessing the elective franchise and permitted to take part in legislative and judicial deliberations.”

To be a good citizen then, under that definition, would require a careful study and thoughtful investigation of all proposed legislation affecting commodity welfare, that you might safely take an active, intelligent, independent part in all legislative affairs.

If you do not understand a question, it were better to not vote at all, than to vote wrong.  Remember, you do not have to vote, as so many good people seem to think ;  nor do you have to take a choice between two evils.  When you do, you stultify yourself, and vote against your judgment, and best interests.

The average citizen has not given the attention he should to this very important duty so vitally affecting his own welfare, and that of the community, of which

    Imitation Sincerest Flattery 293

he is a part.  Perhaps, because he did not realize the importance of it, or maybe he was too busy working to make a living, or possibly he placed too much confidence in some of his fellowmen, but in the majority of cases it was just because he had formed a thoughtless bad habit of placing party before principles.

Whatever the reason, this neglect of duty gave an opportunity for a comparatively few men, who understood the folly of partisanship, and the advantage of co-operation, to secure the things they wanted, to organize to secure legislation for their own special interests.

They realized how much more practical it was to own and control the party than be owned by the party.

The first question they ask themselves is :  Can we trust the party to do as we want ?  Have they kept their private pledges to us, in the past ?  Are they pledged to our present program ?  Unless they are satisfied on these points, they will not support them.  They have succeeded, because they always work and vote for what they want, and in time they get it.

“Imitation is the sincerest flattery”;  “Go thou and do likewise.”

We cannot expect to have, and never will have, faithful and efficient public service until we apply exactly the same business principles to our public affairs as we do to our private affairs.

We must treat our public employes just as we do our private employes.  The fact that they are employed by the community, small or large, should not exempt them from faithful service in accord with the terms of employment.

The legislative positions are, next to the judiciary, the most important, and, as a rule, receive the least attention.

You would not for a moment think of giving an unlimited, irrevocable power of attorney to a stranger, to transact your private business, and yet that is just what you do in your public business, under our present representative system of government.

294 Public Service a Private Snap  

We give to our legislative employes an irrevocable and unlimited power of attorney for from two to six years, with unlimited power of taxation, direct and indirect.  In addition they have, and they exercise, the power of granting public franchises for public service in transportation, distribution and exchange, with power of taxing for service all the traffic will bear.  They make public service a private snap.

Why longer tolerate, or permit, this great difference between public and private service ?  The one is just as much your business as the other.

In the employment of a public servant, for that is just what you do when you elect them, and more especially for a legislative position, the questions you should ask yourselves are :

Has he qualified himself to serve in that capacity as a student of political economy ?

Has he shown that he is competent ?

Does he represent my principles ?

Can I trust him to represent me and my interests ?

Business Practice.

What is your practice in your private business affairs ?

You wanted to employ a man for the season on your farm.  There was Nels and Bob, each of whom you had employed in the past and they had proven to be incompetent, unfaithful and wholly unreliable.  Would you choose between them, or would you try a new hand ?

Or suppose you are a manufacturer, using upto date business methods, as you would have to, to succeed.  Would you employ any one who applied for a job, or would you insist on having competent, expert help for the several departments of your factory ?

If a member of your family were sick, would you send for a lawyer ?

If you wanted an man to run your engine, would you hire a common day laborer ?

If you wanted a competent bookkeeper, would you employ a person who could neither read nor write ?

    Campaign Contributors Control 295

Very foolish and absurd questions, you say.  Sure, they are ;  for you would use good business judgment and common sense.

Have you done so in the past with candidates for public employment ?

The probabilities are that you did not pay the slightest attention to their selection ;  you left that for the party managers to attend to.

The Party Managers.

There is nothing the practical politicians in control of a political party delight in so much as a large campaign fund ;  not for educational purposes, but the very reverse ;  to deceive the honest citizen, and in influence the dishonest.

To secure this fund, the party managers must select those candidates only whom they believe will “play the game”;  that is, abide by the decisions of the party caucus.

The party managers take their cue from the contributors, who in turn control the party caucus, and the result is just as certain as any other well planned business transaction.

The Voters.

As for the voters ?  Oh ! they don’t count after election.  They have saved, or tried to save, their party, and having done their partisan duty, it is now up to the officials to do theirs, and then what a change.

The representative-elect is under no obligation to the voters ;  they belonged to, were owned by, the party ;  and their vote for him was simply an incident.  They would have voted for his opponent, whom they had declared to be the meanest and worst man in the party, had he been nominated instead.

The public official’s obligation is to the party machine and not to the party voter.

And the Party.

The political party is under no obligations to the voter who belongs to it, and has no thanks due for obeying the master’s call.

296 Place Principles Before Party  

The party could not have won without the campaign contributions.

Blind idolatry of, and obedience to, party is destructive of every function of true citizenship.

To become a slave of your party, is to become a slave of the very worst elements of your party.

Good Men Fallacy.

Under the present system as practiced by the two dominant parties, there is always a recognized “boss” or “leader” for each faction.

His aides are a few practical politicians, who are used to doing fine work.  Long before the campaign, and before you have given any attention to it, this inner circle meets in secret, to talk matters over and fix things for the coming campaign.

Do they discuss principles ?  No !  Principles are a nuisance.  Their bi-annual harvest is approaching and prospective political patronage.  What they want is a campaign fund.  They plan accordingly.

If they think they have a safe majority, they will nominate the “faithful workers.”  If not, or if they are in a minority, they must select “some good men” who can draw votes from the opposition.

Now these “good men” are under no obligations to the voters.  They are under obligation to the men who selected them, and secured their nomination and election, If they fail to “play the game” their usefulness to the machine ceases, and they are retired.  A great many good, sincere, earnest reformers have had their wings clipped and public usefulness permanently destroyed by accepting a nomination and election to office on an old party ticket.

It is the good men and women who thoughtlessly perpetuate the bad system in control.

The good citizen who realizes the true duties of citizenship, who tries to reform one of the old parties from within, takes much greater chances than the good girl who marries a drunkard in hopes of reforming him.  She occasionally succeeds ;  the former never has.


The problem discussed in this book is not only nation-wide, but world-wide, and of necessity, for a work of this kind, to keep it within the limits for general circulation, much had to be sacrificed to brevity, and many points left undeveloped.

The new system of national bank credits versus government money.

Of government control as provided by the Constitution ;  or delegated control as per the Federal Reserve Act for private profit.

The inconceivable and rapid increase in private and public obligations payable in lawful money, and the rapid destruction, contraction, and concentration of lawful money, with which to meet these obligations.

The rapid concentration of our great industries in the hands of a few men who will soon control the money and the credit of the nation.

The preferences given by these men to foreign investments and developments over that of American development.

The great and unwarranted expense by taxation of the American citizens for the building and maintaining of a great navy to protect foreign investments, and enforce collections ;  and of a greater army to coerce American labor at home ;  are all involved in this revolution in our financial system, and briefly touched on in the limited space of this book.

I realize fully that much that should have been said has been left unsaid, and same statements made that may seem incredible.

I propose to continue a study of this problem, and earnestly desire that readers of this book will feel free to write me for further particulars and information along those lines.

I am sure that it will aid me in the continued study of this our greatest economic problem.



Now that you have read the book through, I have a special request to make of you.

In exposing this great conspiracy, I have recalled many facts that students knew, but have not applied of late, or coupled them up, link by link, as they were patiently, persistently, and efficiently made, always under cover, or by false representations as to what was intended.

The chain of evidence is complete, though perhaps, to keep the book within the price I had planned, not developed sufficiently.

Probably you did not grasp the intent of the author in many of the earlier pages, until you had finished, and perhaps you will not now until you re-read the book.

For thirty years of a very busy life I have given this problem some study, with very limited material for research, and without the means to employ help.

Twenty-five years ago I clearly saw the possibility, and probability, of a private monopoly of our medium of exchange, and pointed it out in a text book prepared at the request of the National Farmers’ Alliance and Industrial Union, of which I was President.

The average man looked upon it as an idle dream, and the beneficiaries of special privilege denounced it as wild-eyed, visionary, paternalistic, anarchistic, socialistic, and several other similar pet names.

I have watched the game as played, but not neither the time nor means to expose it.  I now point to actual facts accomplished, the official policy for the future as outlined, the greed and ambition of the beneficiaries and the unpatriotic preference in sacrificing home for foreign development.

The study and exposure should be continued, and will be if this preliminary effort is sustained, which will be indicated by the sale of this book.

My special request is for your assistance, in circulation, in writing for, and giving information, and offering suggestions, all of which, including adverse criticism and corrections, will be appreciated ;  for I feel that another book should soon follow for the further development of this vital American labor problem.



If this book has met with your approval and you think that the information contained therein should receive a large circulation, then I hope that you will assist in any way you can.

Neither the House of Morgan nor any of its many arms will aid in its circulation, but the reverse.

Indeed I have already felt the power of financial blacklisting.

It is not a book that can be sold through the ordinary channels of book stores, because the average man has not the slightest idea of the impending danger.

It cannot be successfully advertised through the press.

First.  Because I have not the means to advertise.

Second.  The controlled section of the press would not advertise it even for pay.

I must depend for its circulation upon interested individuals, and soliciting missionaries.  For the latter I think that there will be a fair compensation, and a satisfaction of serving humanity.

Further proof of the Conspiracy is rapidly developing, and should be exposed promptly as it develops.  To this I will gladly devote my time if sustained by proper encouragement.  The best evidence of that to me will be in the sale of the book.

Every one who reads the book can sell at least one copy, many of you can sell five copies.  I will always be glad to hear from readers of the book, and especially students of Financial Freedom for Labor.

Sincerely yours,



The Public is an editorial paper which discusses state, national and international affairs from the Single-tax point of view.

It abstains, however, from mingling editorial opinions with its News of the Week.  This news story, written by democrats, covers in concise and plain terms all the news of historical value.

Read The Public for information on
Taxation of Land Values,
Direct Legislation,
Public Ownership of Public Utilities,
Commission Government,
Free Trade,
Internationalism, and for able, non-partisan discussion of all political, economic and social problems.

Familiarity with The Public will commend it as a paper that is not only worth reading, but also worth filing.

Published Weekly at One Dollar a Year.

Send orders to
H.L. LOUCKS, Watertown, S.D.


Washington, D.C.

Established for and devoted to, as its name implies, the free, fair and full discussion of Farm Economics, as selected by its readers.

One of the topics now under discussion is “Financial Freedom for the Farmer.”  And this is what Hon. C.B. Kegley, President of The Rural Credit League of America, said about it in his annual address as Master of the Washington State Grange, June 5th, 1917 :

There seems to be some question in the minds of some of our most worthy Patrons as to the value, to farmers, of the federal farm loan act, and to settle these differences a discussion has been commenced in the Farmers’ Open Forum by Brothers H.L. Loucks and George P. Hampton.  Neither of these brothers need any introduction to the farmers of this state.  The whole-souled devotion of both to the farmers’ cause has been proved again and again under the severest tests, and, what is equally important, they are strong personal friends, with full confidence in the sincerity and integrity of purpose of each other.  Their difference is purely a difference of the head, and as both have national reputations for their mastery of national affairs, and for their ability to express their views, I look forward to this series of articles as among the most educational, useful and clarifying on financial matters as they affect the farmer that have yet appeared in print.  I urge every farmer to get these articles, read them, and discuss them in meetings and with their neighbors.  I not only urge this on farmers but on bankers, merchants and professional men who honestly want to get the farmers’ viewpoint and to co-operate with the farmers to bring about a common understanding of what really constitutes financial freedom.  Patrons, I shall look with intense interest during the year to see which of our Subordinate Granges and which of our members are most active in this important work.  It is up to us to see to it that so far as we are able this discussion is carried to a conclusion that will clear the cobwebs out of our minds on this most vexatious of all the great questions.



This is an up-to-date book and is worth while to read ;  every chapter is an eye opener.  It is a clear, strong and convincing argument against interest or increase on any loan of any kind.

This book clearly shows that usury was condemned by Moses, by David and Solomon and Jeremiah and Ezekiel and Nehemiah, and by the teachings of the Great Master, and was not practiced but condemned by his followers, as shown through seventeen hundred years of church history ;  that it is destructive of the sovereign rights of man and the just equality of men ;  that it is based on a false ethical and also a false economic principle ;  that usury thrives on debt and therefore encourages the debt habit in individuals and municipalities and nations ;  that the borrower is servant to the lender, whether that borrower be an individual or an empire.  The book shows, in four chapters, how usury oppresses the poor through no fault of their own, and how impossible it is to prevent this, and how the poorest suffer the most.  This book shows how usury centralizes the wealth of the wealthy into fewer and fewer hands, absorbing the smaller fortunes into one colossal financial power, and how futile it is to resist this fate ;  how the great debts of the nations now enable the usurers to dominate the world ;  how this degrades ideals and lowers character ;  how usury is the root of many of the social and industrial evils ;  that it builds the wall between capital and labor ;  that it is the principal hindrance to the world’s peace.  The reasons why this evil was permitted to grow to such enormous proportions and to overrun the earth are frankly stated and the book closes with a chapter, “Crushed Truth Shall Rise Again,” which is a clear, strong, optimistic, convincing argument that usury will be overthrown as many other as deeply entrenched wrongs have already been.

39 Chapters, 300 Pages, Cloth Bound, $1.00.
Send orders to



Exodus From Poverty


The Other Economics




This is no ordinary book.

A great hope now seems possible—the abolition of poverty and war.

A master mind has given the world the most original, penetrating and far-reaching treatise on the baffling problem of poverty—its real cause and its practical cure—that has ever appeared.

This book is in a class by itself.  It affords a key that unlocks a multitude of delusions.

Doctor Craft gave his whole life to the solution of our social ills and is the best economist of the new school of “The Other Economics.”  He makes a clear distinction between the two fundamental principles of economics.  This has never been done before.  One principle, and one alone, is all that the human race has ever tested.  The other—the wealth principle, the peace tending principle—we have never yet tested in a system of business.

This author suggests a Government Experiment or a scientific test of “The Other” or the untested principle.  He proves that peace and plenty can never be evolved from a war-tending, poverty perpetuating principle.  And that peace and plenty could be evolved if we changed our economics and adjusted business to the right principle.

His ideas are attracting the attention of our greatest thinkers.  Even the United States Department of the Interior, at the direction of the President, has investigated the suggestions of this author and pronounced his ideas to be “fundamentally sound.”

Don’t wait.  Get this book.  It is a library of thought.

The Wonderful Book of the 20th Century

Order From H.L. Loucks, Watertown, S.D.