V.gabond Editorials

By Jack Dionne

I've said lots of unkind things about the banker in this column in the past few years, but I'll have to admit the fellow has my genuine sympathy. Right now he is catching fits every day in reports from Washington. It is stated on every hand that he has fallen down on his job, that he refuses to extend credit such as banks have always done and urere created to do, and that he is blocking the wheels of progress.

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But ask any banker and he'll tell you that the bank examiners are tightening the strings of credit every day more than they have done since the depression started; that the banks are made to call loans and throw out collateral right now, that they consider good, and have considered good for a long time.

Every banker you talk to can furnish you instances to prove these declarations. A banker friend told me the other day of the examiner picking a note from his note file, and suggesting that he try to collect it as he (the examiner) did not believe it was any good. "You're sure that's your opinion, are you?" asked the banker. "f am," said the bank examiner. So the banker showed him that the maker of the note had twice the amount of the note on deposit in cash at that very moment.

Another banker told me of a new loan he had made. The examiner looked it over. "Why did you make this loan?" he asked. "Because that rnan is good for it," replied the banker. "The best indication of that will be to make him pay it," replied the examiner. "I suggest you call it."

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And so on. You could write books of bible size of the things you hear. But what occurs to me is that it would be very simple for the bankers to get the thing straightened out. Why don't the American Bankers Association say to Mr. Roosevelt: "Mr. President, we are being assailed on one hand for failing to extend proper credit to worthy people and industry, and on the other hand the bank examiners refuse to permit us to extend such credit. You tell us what to do about it, and we'll do it." I think they'd get a prompt answer. There's an Ethiopian in the fence somewhere. Let's see who, and where? It ought to be easy to clear up.

The chief criticism I have of the banker right now is that he fails utterly to publicly state his position. He forgets that "silence gives consent." While he is being assailed, he fails to talk back. If he is being unjustly condemned, it's his own fault for not throwing some light on the situation. Why he doesn't speak up, and tell his own story, and take the public into his confidence in these public matters, is more than I can understand. ***

He is doing the old ostrich trick of sticking his head in the sand, and it won't help at all. It will just get him sunburned in the wrong place. What he needs to do is follow the philosophy of the Rev. Sam Jones and "get his fodder down where the cattle can reach it." Either he is in a worth-while business that is trying to play its part in the recovery effort-or he isn't. If he is, he should say so. What the banker needs most is to talk back some to his critics.

The time has come when the smartest man in every bank should be the public relations man. Every bank should take its smartest employe and make him the public relations manlwith power to act. Banks that haven't any smart men in their personnel, should hire a smart man for their public relations activities. This applies to big banks and small banks, city banks and country banks. There is too big a question mark after the word bank, in the public mind. Answer the question-aloud ! **d.

I talked to another bankers' convention the other day, and they gave me a great hearing. I told them, among othef things, that the greatest help they could render right now in improving business conditions would be to use their influence to get the depositors in their banks whose scared money is piling higher and higher, to take some of it out of the seclusion of the bank vaults, and put it to work where it will employ human beings. Put it into decent mortgages, on decent homes, for decent people. And, f told them that such mortgages were ten times better investments than government bonds, and they ought to tell their people so; and that when all the idle money in their banks went back to honorable employment, the depression would be automatically over.

It surprised me hpw fully every banker I talked with afterwards, agreed with what I had said. There isn't a small town banker anywhere who cannot furnish right now a long list of worthy people who are willing and anxious to build themselves homes whenever they can get just normal financial assistance in so doing. They told me so. And, the retail lumber dealer everywhere tells the same story. The dividing line between a building boom and building lethargy today is the simple need of decent financial assistance.

Mind you, I don't think the banks can loan the money to build homes with. They cannot tie up their cash in any such long-time fashion. But, as the financial and business advisors of their clients, they CAN tell the owners of idle money that this is the time to put it to work.

And, the gravest charge I bring against the bankers I have checked on during the past year is that they have evidently been giving exactly the opposite advice. When a depositor came to them and said, "I am thinking of taking my money and investing it," the banker raised his hands in holy horror, and said, "Not yet; it wouldn't be $rise." And, when a man came to them and said, ,.I am thinking of taking money and building," they cried, ,,Don't build !" There can be no doubt but that this has been the general attitude of the banks.

There can likewis" o" :r.u"lo. orr, that such an attitude and such advice has served to prolong and intensify the depression. And, depression will last just as long as we play the game an.a -1t. * * f sent a wire to my friend Jesse H. Jones the other day and told him that this country is ready to get well; and that all that is needed to push it across the border line between depression and returned prosperity is a little intelligent help. I suggested that if the government will furnish a market for perfectly good building paper, we will all wake up within three months' time and wonder where the depression has *o.".

We could take the same amount of money that we have been spending for CWA this winter, and invest it in new building paper, and put men to work as fast as CWA drops them. It would be REAL work. And, it would last a long time. And, by the time the building drive was over the threads of industry and of commerce would have woven a carpet of genuine prosperity; and we would be on our way. ***

Every day now someone rises up and declares that the Recovery Act is not constitutional. Well, who said it was? My understanding is that it has the same basis of constitutionality that drafting and conscription of men and materials has in time of war. As an emergency in time of national peril the Constitution may be set aside temporarily. Thus it is with the Recovery Act. It is an emergency measure for a limited period of time.

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Of course, when they get to talking about its PERMANENCY-that's something else again. I irnagine we'd have to make guite several changes in the Bill of Rights and other portions of the Constitution to make the invasion of private property rights PERMANENT. I believe that when Mr. Roosevelt speaks of the p€rmanency of some of these philosophies, he means the permanence of the underlying principles involved.

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'Personally, I think minimum wages and maximum wgrking hours are a blessing, and, if it could be arranged without putting business at the mercy of politics I would be

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