GIFT OF From a fifteen-minute Sketch from life, by SENSENEY Henry Clifford Stuart 2619 Woodley Place Super-Counsel \V7 L r^ r^ Explorer Founder Washington, D. C. Confront**- Rehabilitator For Special Missions or Fixed Post 51 Years Unimpaired vitality 235 Pounds A Directing Mind 6 ft., 3 in. Great Executive ability 75-8 in. Hat Basic Financial knowledge Widely travelled Great business experience Originality Understanding Expression Thinks in Spanish Fairly fluent in French Attacking German Has begun to understand English Promises a working-acquaintance with any tongue within three months Vibrates with the Times To Anybody, Esq. Personal interview The Seats of the Mighty Terms unusual Always up-to-date A Prophet in His Own Country 340721 IN MEMORY OF THE MOTHER WHOSE NOBLE THOUGHTS OF ALL BUT SELF BARE ME WITH BOTH HANDS OPEN THE BEGINNER il'aused at the intersection of Connecticut and Rhode Island Avenues) PRAYER As I rise under stand me, that I falter not. As I reach-out for that which is good, hold Thou from me all less good. A PROPHET In His Own Country Being the letters of STUART x bWvT, y. To many men on many occasions Edited with an introduction and notes By ALEISTER CROWLEY Published by the Author: 2619 WOODLEY PLACE, N. W. WASHINGTON, D. C. Copyright, 1916 By HENRY CLIFFORD STUART ALBANY J. B. LYON COMPANY, PRINTERS IQl6 ,/;V : :^ AUTHOR'S KEY-NOTE " My Country May she always be right, But my country, right or zvrong." This Is the motto of those Who have been taught To believe their duty to be "Not to reason why," but " To do and die " For the Exploiters Of their own And every other country. No longer May a Black Brunswicker, While belting his sword, Soul fully say, To the Wife weeping On his shoulder; " / could not love Thee, Dear, so well, Loved I not honour more" Yet this sentiment Still holds the Davids As they belt the Philistines. INTRODUCTION It is a generally recognized fact that the onlooker sees most of the game. The rulers of a country make most of their mistakes because the knowledge of detail which is constantly thrust upon them is so great that it blinds them to fundamental considera- tions. The emergencies of the moment lure them into bypaths in which they become lost. Those ancient governors who, despairing of their own judgment, consulted the oracles, were truly wise. England never made so serious a mistake as when she failed to utilize the brain of Carlyle. The tend- ency of all men who are immersed in affairs, whether public or private, is to become concen- trated upon tactical problems, and in doing this they lose sight of the principles of strategy. The real ruler or adviser of a nation should be a man entirely free from the expediencies of the passing day. The mischief wrought by failure to under- stand these facts is particularly obvious in finance. Politics, in some countries at least, is still looked after by men of broad general education; but finance is entirely in the hands of experts. Its terminology has been deliberately complicated; partly, no doubt, as in the case of law, with the idea of making it easier to hoodwink the layman; but the so-called experts themselves have become" totally oblivious of the fundamental principles of ii their own business. Even worse, they have become ensnared by the greatest of all possible delusions; not only are they ignorant of the truth, but they believe most firmly its exact opposite. Money appears to them the only thing of value, whereas in reality it has no value whatever. It is merely a convenient medium of exchange of commodities which have value. If it were not for this, the present system could never have been created. As things are, a piece of paper is just as good as a piece of gold; but, as everyone knows, even the financiers, ninety five per cent of the gold never existed. The possibility of calling for gold has so frightened those very people who have been scream- ing for years that gold was the only basis, that already there has been a threat to demonetize gold. This is no vain threat. It is quite possible and will almost certainly be necessary; though probably the process will be carried out by some trick which will conceal the fact from the people. But you cannot demonetize wheat, or coal, or copper, and any one who possesses these things can call for anything he likes in payment for them, and be sure of getting it. But the financiers of the day avoid all consideration of the enormous calamity threatened by the present situation. They are only excited by perfectly trivial and temporary events, such as small movements in the value of stocks. It never occurs to them that the most trifling shifts in the real economic situa- tion may reduce the value of stocks to nothing at all. The history of finance has always been the history of more or less desperate efforts to hide these facts. And the drastic expedients adopted at 12 the beginning of the war shew clearly enough in what delicate scales the business of the world is weighed. Now, whenever a crisis occurs in the affairs of the world, it is imperative that they should be ex- amined de novo by a mind which has never lost sight of fundamentals. The expert becomes use- less at such times for the very reason that he is an expert. Temporary expedients will not serve. As a matter of fact, this is always more or less sub- consciously recognized by the good sense of the people. The hopes which were excited by the elec- tion of Mr Wilson to the presidency were based entirely on the fact that he was not a professional politician. In the same way, in England, to take a recent example, Edward VII was trusted and respected by the people principally because he had won the Derby. The instinct of democracy is always sound; its mistakes are due to that instinct being overlaid by the partial development of its intellect, which too often leads it wrong. But in moments of calm it invariably distrusts the appeals which are made to its cupidity or its cowardice; and it much prefers its affairs to be in the hands of ordinary, sensible men of the world. The political tragedy of England to-day is largely due to the replacing of the good, old-fashioned, honest states- men, like Lord Salisbury (stupid as he was) by clever and ambitious nobodies like Rufus Isaacs and Lloyd George. It seems just possible that the pres- ent catastrophe which has overwhelmed Europe and threatens to engulf civilization entire may arouse the deepest instincts of the people, and cause them to 13 appeal to the only types of men who can save them the Prophet and the Poet. America has no Poet, and may be counted exceedingly fortunate in pos- sessing a Prophet of the first class : Mr Henry Clifford Stuart. Imagine to yourself a big man, a really big man, six foot three in height, broad and well-propor- tioned. The entire impression is of bigness. And as should always be the case with homo sapiens, the most important part of the impression is given by the head. Such a brow is only seen in the world's greatest thinkers. Mr Stuart was born in 1864 in Brooklyn, N. Y. His father, John Stuart, was a Captain of the 5ist and Lieutenant Colonel of the 63d New York Vol- unteers. He is the perfect and ideal type, fast dis- appearing, of the aristocratic American. Mr Stuart was educated in San Francisco, California; but it is one of his favorite claims that he is not educated. Rather, he would say, he is beginning to educate himself. And this is one of the secrets of his immense power of brain. By education in the ordinary sense we mean that an old fool bullies a young fool into agreeing with him. In order to obtain a university degree it is necessary to stultify oneself by agreeing with the particular clique of fifth rate minds who, having been totally unable to carve out any way in the world, have become sod- den in the backwater of a university ; and taken up teaching as a profession, because they are incapable of learning. One has only to think of a subject like history to see how lop-sided conventional education always is. Even in more truly scientific subjects there is the same parochialism. Consider Sir Wil- liam Hamilton and his doctrine of the quantification of the predicate, which everybody in Edinborough in his time had to accept, or fail in the examination, but which every other school in Europe regarded as nonsense. Such training can only serve to unbal- ance and destroy the mind. Mr Stuart avoided this tragedy. Instead, he read everything, kept his eyes open, and never allowed the specious arguments of the logician to lure him into conclusions opposed to common sense. Almost every writer falls into some trap. Either he omits a premiss, or takes a false one, or commits some logical error unper- ceived. But with such skill does he execute his sophistry, and so deeply does his vanity flatter him, that even the most careful revision fails to discover the error. Consequently, humanity is always the prey of deceptions. Think for example of the arguments in favor of vegetarianism. It is impos- sible to refute them. At the same time they are totally invalid, because they neglect one single, small, but all-important fact : " Man is a carniv- orous animal." The calibre of Mr Stuart's mind is such that he is incapable of being hoodwinked by any mere arguments, however clever, cogent, and convincing. He invariably applies the standard of truth, intuitive or instinctive, to the conclusion. And if there be a contradiction, he perceives it instantly. A brain of this kind is peculiarly useful in America, where the people are the slaves of false logic. In transplanting themselves from their native soil, they have left behind them their greatest pos- session: inherited race knowledge. I have never 15 yet met a stupid American. But Mr Stuart is almost the only one whom I have met who was not silly. No people are so quick to perceive the mean- ing of what is said, or so eager to listen to what may be said, but they judge entirely by what is said : they have no standard of atavistic experience to tell them whether it is right or wrong. The most ignorant peasant in Europe, who firmly be- lieves in ghosts and vampires and werewolves, who cannot read or write, has never travelled beyond the radius of twenty miles from his hamlet, and knows nothing of his country's affairs, much less of the world's, could never be so insensible to the facts of human nature as Henry Ford. You could argue with him ' till all was blue,' but you would never even begin to persuade him. He would know it was all nonsense, just in the same way as you cannot fool a dog about a tramp. It is true that this instinct is sometimes wrong after all in certain minor matters, because now and then conditions do change. But in all fundamental points humanity has not altered since the cave man. A friend of mine was arguing the other day about this very matter. " Nowadays," said his opponent, " if you want a girl, you cannot ' twist your knuckles in her hair, Club her, and drag her bleeding to your cave." "No," said my friend, " things have changed a great deal since the eighth of July ! " It is just this capacity for seeing everything sub specie aeternatitis which distinguishes the great artist or the great seer, even to a certain extent the great statesman, from plausible imitations. We do not value Shakespeare's histories for their political 16 views; in fact, the portrait of Joan of Arc is a stain upon the character of the poet which no ages can efface. (But the English always blackguard gallant enemies.) The merit of the histories lies almost entirely in the character of FalstafT, who has nothing to do with the period. And the political errors of Shakespeare show how difficult it is, even for one who has the vision of the eternal, to keep straight when he comes to deal with the tem- poral. But the explanation is that Shakespeare was a snob, the lackey of debauched noblemen, without virility or independence of character. Courage is certainly the first of the virtues, for without it none of the others can be exercised. In the case of states- men a little more latitude must be allowed, because they are compelled to deal with the conditions of the moment. But, even there, the best epithet that can be applied in praise of such a man is that he is far-sighted; and the way to be far-seeing is to refuse to be obsessed by the expediencies of the hour. And while it is of course impossible to make every particular conform to the general, it can at least be arranged that it should not be in flagrant contradiction of the first principles. As a concrete example, the annexation of con- quered countries. Economic or military reasons have often been allowed to over-ride considerations of the will of the inhabitants. Such acts have almost invariably caused trouble later on, and such trouble frequently extends far beyond the territory in dispute. The injury to the fingertip poisons the whole body. The Germans in 1870, when asked whom they were fighting, replied : " Louis XIV." 17 And it is because that monarch tried to extend his dominions that they, at this present moment of writing, are invaded. The need of an independent mind in dealing with all such matters is evident. Not only must the statesman be a philosopher, but he should also have in his composition not a little of the mystic. We do not use the word mystic in the specialized sense, in which it is too often em- ployed to-day. The true mystic is one who sees all phenomena without bias, prejudice, self-interest, or obfuscation. In thinking of kingdoms, he thinks of spiritual kingdoms ; and here again we must use the word spiritual in its oldest and widest sense. In such kingdoms faith is more than frontiers, lan- guage and literature more than markets. Ireland has been systematically depopulated; every engine of oppression has been set in motion against her; but she has never been conquered and never can be conquered, because the Anglo-Saxon can never get her point of view. In the same way India has over- come every one of her invaders in turn, though she has never been able to resist even the least of them successfully by arms. The English in India have become, within two generations, more Indian than the Indians themselves, in many important respects, particularly in that of caste. In the case of South /Africa it is once again evident how far more vital than material considerations are the spiritual. The Boers, driven from one settlement to another by the most barefaced treachery and tyranny, and finally conquered in their last stronghold by invading armies outnumbering them twenty to one, were yet able to reconquer their country for themselves, 18 without a drop of bloodshed, within a decade of the fall of Pretoria. But in order to perceive the rights and wrongs of all such matters, independence of mind is just as necessary as clearness of vision. When the man can be influenced by considerations of his own wel- fare, when hope and fear find any place in his mind, he is no longer to be trusted. The only man who can fulfil this condition is the prophet. ( It must be remembered that the functions of poet and prophet were originally identical. The distinction between them is the artificial one of form. The states of mind are identical.) A true prophet lives only by virtue of his inner vision. He is responsible to what he calls God, and to nothing and nobody else. Such men are rare, as are all other types of genius. And it is the innate perception of this fact that causes the people to look for prophets always, but most especially in times of crisis. For this reason also false prophets abound. It is only natural that the valuable should be counterfeited. But the test of the true prophet is a very simple one. It is the independence of his mind. False prophets are venal, time-servers, flatterers. They make it a rule to say what other people wish to hear. They have no grasp of fundamentals, of essentials, of the spiritual truths that lie beneath the accidental and temporary phenomena which obsess other minds. They are also characterized by simplicity. There is no sophistication in their intellect. When they add up two and two it always makes four. Even when you have your true prophet, however, it is commonly found that there are difficulties in 19 using him. Firstly, his uncompromising directness, and the fierce quality in him, need tempering with tact ; or seem to do so. Secondly, his utterances are often obscure, or seem to be obscure. They are not really so. But where a thoroughly sophisticated mind, nursed on false premisses and schooled in sophistries, receives the impact of the prophetic intelligence, it is bewildered by the simplicity of that intelligence. One is reminded of the story of the charlatans who proposed to weave for the em- peror a robe which should be visible only to the innocent. They made no robe at all. But the emperor and all his ministers had to pretend that they saw one ; and the fraud passed undetected until a child in the street cried out : " But the King is naked ! " Nowadays, however, people are not so easily undeceived. The child would very likely not be understood. The word " naked " is not in the vocabulary of the fashionable dressmaker; besides which, the word is improper. We know that there are no such things ! So that even if a dawning per- ception of the meaning of the prophet strikes the more enlightened minds, it is often put aside with a sort of horror; although that word has been awaited with yearning and anxiety. Now it must be confessed that this objection does to some extent apply to the writings which we have under consideration. Mr Stuart's style is as difficult as^ Wagner's or Whistler's were to their contemporaries. We have acquiesced so long in the false meanings which have been placed upon the simplest words by those whose interest it is to deceive us, that when those words are used in their 20 proper, simple sense, we hardly recognize them. For this reason we have deemed it necessary to comment in various places upon these letters. It is also to be remarked how curious a form Mr Stuart has chosen for the expression of his thoughts. It is simple, attractive, and convenient, and possesses the great advantage that his messages are auto- matically dated. Mr G. K. Chesterton, in one of his books, I think that on Browning, has remarked upon the utter futility of language. It is impossible to express thought, unless the person who is to receive it has already some inkling of what is meant. For example, if I say that someone is a Puritan, the remark may be taken as a compliment or as an insult, according to the ideas in the mind of the reader, or of his ideas as to what my ideas may be. Unless the context makes it clear, doubt is certain to remain. Nor need one suppose that there are any words free from this ambiguity. Everything at one time or another has been the subject of vio- lent praise and violent blame. If any one asks me for the meaning of the word God, I must first know whether the word is being used by the Pope or Mr G. W. Foote or Herbert Spencer or Billy ' Sunday. If you ask me for the meaning of the word " soul," I am equally at a loss. To the Budd- hist it is a figment of the imagination of certain Hindu philosophers. The Qabalists use it as almost synonymous with " body." Every metaphysician that ever lived has used this word in a different sense, and has nearly always forgotten to define it. Now if, to bring back the matter to the question 21 of Mr Stuart and his letters to the universe, we find in one of them the word " gold," we may be too ready to assume that something extremely valuable and painfully inaccessible is meant. The same difficulties constantly recur. These letters require profound study. Not because the thought is obscure for it is not so, it is exceedingly simple but because it is new. The average individual is brought up in certain beliefs, and any examination of these beliefs is positively discouraged. When fundamentals are attacked by a new thinker, people are completely thrown off their balance. At first they refuse to believe that they have heard aright. When it was first stated that the earth went around the sun, no notice was taken, because it was too absurd for discussion. It was only explanation of, and insistence on, the statement, that began to arouse enmity. Now, the kind of obscurity which arises from the fact that the hearer has nothing in his mind which would make him capable of under- standing what was being said to him is not avoid- able. The classical example of this is the trans- lation of the Buddhist canon by the missionaries. They started with the conviction that the Buddhist must believe in a soul more or less like the Christian soul, and that Nirvana, being apparently some sort of place of residence not upon the earth, must be a variety of heaven. The result was of course a total misunderstanding of Buddhism. It was seen that the context did not square in any way with these conceptions, and the missionaries thereupon had the impudence to assume that the Buddhist was being illogical and self -contradictory. 22 It is really necessary to hear Mr Stuart rather than read him. When he speaks he is transfigured before you. The placid power of the man gives place to elemental energy. Both aspects remind one of the sea. It seems almost as if he grew physically much bigger. His personality fills the room. I have heard many of the great orators of the day, never one with one tithe of the passion and power of Mr Stuart. BenTillett comes nearest. But Ben Tillett wastes his power in furious gesture. With Mr Stuart the thunder of his tread and of his voice shake the house ; but there is no loss of self- control. The speech is not diffuse, but extraor- dinarily concise and emphatic. The words rush out like molten steel from a converter under the blast. But each phrase is succinct and concentrated. For this reason, perhaps, he could never make a popular speaker. People like to have a man drone on pleasantly for an hour or so with mild excitement. They do not care to be swept away or crushed by real eloquence. Yet this is the kind of speech which has always moved men from the beginning of the world, and always will. It cannot be prolonged. Twenty minutes of it, and the nerve- force of every hearer would be exhausted. He would be mad to get up and do something ; and that something would be what Mr Stuart told him. But the old ideal of oratory has passed. Mark Antony's speech would be rather bad form. People do not want to be moved to do more than pass a nicely worded reso- lution. But if a real crisis should arise in the affairs of the nation, then would come the moment of the genuine prophet. With a force not his own, 23 but cosmic and elemental, he would sweep away the cobwebs of the old ideas, the accepted sophistries of centuries. His words would be hurled forth, thunderbolts new forged from the smithy of Almighty God. And they would smite the hearer with such suddenness and vehemence that his inertia would not even find time to begin to operate. The present is such a moment. But people are not aware of it ; they are still listening to the false prophets who prophesy smooth things. The critical situation of the world at present lies not in Europe. Europe's fate is known. It lies in America and China. The attention of every man of even the smallest degree of foresight should be concentrated on this fact. It is emphasized clearly enough in these letters. And the great merit of Mr Stuart's vision is that he saw these things in their entirety long before any other man had even begun to think about them. Another difficulty which arises in connexion with prophets is that, although they may see as clearly as never was, and even express themselves in lan- guage suited to the understanding of the common people, or even to that (immeasurably inferior) of the so-called educated man, there is yet a question as to whether their word can be carried into effect. The prophet has usually been content to speak: to leave the responsibility of action with his hearers. Very rarely do we hear of a true prophet being a great administrator. Here once more America is fortunate. This is probably the greatest crisis that has ever occurred in the history of the world ; : 24 and infinitely wise, all-seeing nature has provided against catastrophe by combining these two rare faculties in a single brain. All his life, until the last five years, Mr Stuart has been a man of affairs. He went to work at fourteen years of age under his father, and was gradually compelled to do the work of both, with the result that before his twenty-first birthday he had become freight traffic manager for Central America's most important railroad. He has also been in charge of various consular and diplomatic offices from time to time. He was land commis- sioner of the Panama Railroad; and has also been in the real estate and mining businesses, and factor of an important shipping company. He brought the Salvador Railway Company out of bankruptcy, and reorganized the Port of Champerico. He has also been general councillor for Spanish-American affairs in New York City. But it is not only the able administration of such matters that pioves the capacity of a man. Many a muddler has gone through public life on the shoulders of competent subordinates without too great a loss of reputation. But there is one sterling and indubitable proof of the administrator. If he orders his own house well, it is certain that what reputation he may have made in public affairs is a deserved one. I have never met any man with the sense of order so admirably developed as Mr Stuart. He can lay his hands on any scrap of paper at a moment's notice. Every book in his shelves has its 25 proper place. His house is fitted with every con- venience and even luxury, yet entirely without ostentation or extravagance. Nor is the order in which things are kept a visible order. No one would suspect it. It is only on investigation that it appears. The German plan is there in all its effi- ciency and completeness, yet there is none of the German manner which, by insisting upon its own excellence so audibly, lashes the Anglo-Saxon v/ho beholds it into a state of such speechless rage. Everything has become subconscious. It is as if Mr Stuart possessed instinctively that supreme method described by the Chinese under the title "The Way of the Tao." "Consciousness is a symptom of disease. All that moves well moves without will. All skilfulness, all strain, all inten- tion is contrary to ease." Unless this method is actually seen in operation, it is almost incompre- hensible. Yet it is the only key to true and perfect success. The Chinese express it in another way. They say : "Do everything by doing nothing." The only way in which we can bring this idea at all near to western minds is by speaking of perfect balance, in the sense in which the fencer or the chess player might use the term. In a perfectly played game of chess the pieces are not arranged so that there is any obvious line of attack or defence. They are arranged so as to be ready to attack or defend in any portion of the board. A definite at- tack upon the king's side or the queen's side, or upon a pawn or a piece, compromises the position. The player is bound, to a certain extent, by his ex- pressed intention. Such attacks frequently suc- 26 ceed; but only because the opponent has already made a still greater mistake, has failed in sound development in some one point. Of this method Mr Stuart shows absolute command in his domestic affairs. And his proposals for dealing with the greatest social and international problems are equally deep and dulcet. He would not put any- thing right. He would gently rearrange things so that they went right of their own accord. Evidences of such proposals are to be found in these amazing letters. Let the reader then con- sider carefully this matter. Let him understand that in Mr Stuart we have not merely the wise man, or the strong man, or the good man, but the neces- sary man. The eyes are clear, the heart is pure, and the hand works in entire harmony with them. When the anarchy which exists in this country be- comes obvious to its people, and the dictator is required to bring order out of chaos, they have only to turn to the portrait at the commencement of this volume, and exclaim: Ecce Homo! ALEISTER CROWLEY. NEW YORK, June, 1916. 27 A Prophet in His Own Country Let Those whose egotism cannot bear the shock of mine avoid this, my book. TABLE OF CONTENTS The Dollar Nos. i- 36A China Nos. 37- 45 The War Nos. 46- 75 Aunt Margery Nos. 76- 95 Miscellaneous Nos. 96-191 Full Index at back THE DOLLAR LETTER NO. i THE BEGINNER " CAPITAL " Wherever the poor be There shall the Capitalists Be gathered together. Man, By strong-arm methods And through legal subtleties, Has deprived his fellow men Of the free use of the land Which all are born to So that he and his class Could idly fatten Off the labor of the mass. Not satisfied With fattening themselves But wishing to accumulate surplus fat The Class Has imposed on the mass A specially-privileged and monopolistic Means of exchange, Despoiling them still again. Access to the land Should be free to all Who are willing to labor. 35 So should the means for exchange Be free to all Who have something to exchange. " BANKER " He who sits at the receipt of custom (ponder this " custom ") - Not for account of Caesar But for himself. June 25, 1912. LETTER NO. 2 THE BEGINNER BANK " DEPOSITS " What proportion of the deposits (money present) reported by the banks, are credits (money absent) ?* If any party, private or corporate, be allowed by banks to " draw against " their note or other col- lateral i. e., be given credit it seems to be the * Even such current terms as " deposits ", " debits ", " credits " have no fixed meanings, but depend entirely upon who uses them, and how. The context, indeed the whole text, frequently conceals the very information wanted, as witness bank statements. The money-lenders' terms are more than ambiguous they are positively deceptive and, in my opinion, inten- tionally so. VALE. 36 custom of the banks to enter this credit on their books as money present (deposit) Whereas the fact is that they present no money at all, but intend to absent that belonging to third parties. Now, as long as the real-money-deposits are not hereby too greatly depleted, and there is left a balance sufficient to meet the wavering demands of the temporary owners of the real-money-deposits, the appropriation of the bulk thereof by the banks is condoned each individual temporary owner not caring a whoop what happens to his collective contemporary cotemporaries, so long as he believes that he may not be denied the use to which* his con- temporary cotemporary ownership entitles him And the bankers very wisely encourage him and the other hims in this belief and trade upon it though it is perfectly obvious to every- body but him that as the bankers are putting the bulk of the money to their own uses, there is very little left for him's use But by thus restoring other people's money to circulation, the bankers publicly render a service greater than any government has ever thought of, and verily are entitled to their reward They have put the money out at usury, as was commanded But they have yet to render their accounting to the Master And it would be well for the banker-stewards to begin to get their accounts in order, and in terms 37 that may be understood by the Master for He will do the examining Himself. WASHINGTON, June, 1912. (II) By " master " is probably meant the people. The use of the word " credit " is here more or less that which people generally understand. Elsewhere Mr. Stuart explains that the only proper use of the term is where money is advanced without security. A. C. LETTER NO. 3 WASHINGTON, December 7, 1912. Editor, THE NORTH AMERICAN, Philadelphia. DEAR SIR: " STOCK-GAMBLING AND HIGH COST OF LIVING " was the editorial that shocked me in yesterday's issue What are you thinking of the People ? Poor Lawson He'll never get over the frenzied manner acquired in the stock-pit It is not con- ducive to thought. Then again, as you say, he's trying to prick a pimple of which he thinks him- self the sole discoverer, quite failing to perceive the source of the trouble. But the place where the real shock comes in is where you voice the as yet generally unperceived Truth that " money should be the servant of busi- ness, not its master"; The whole Nation feels this, and is struggling for expression. 38 I lost a couple of thousand, two years since, try- ing to voice this Truth to the Nation in pamphlet form, but am so encouraged at meeting a fellow Ass that, in the hope we may find a third, I will venture to comment upon that portion of the President's message referring to " Our Banking and Currency System" which I find in that unappreciated and humorous publication, the " Congressional Record." My copy is dated Dec. 6th and was handed me with my coffee, and I cover my pajamas with a wrapper so as to give you my impressions while still fresh ; It begins on page 203 that part referring to the System and I will quote it verbatim, interlarding same with a running line of comment (in italics) "A time when panics seem far removed Ingly only there's a money-shortage now so as to force the Treasury to stake the banks.) is the best time for us to prepare our financial system to with- stand a storm. The most crying need this country has is a proper banking and currency system. The existing one is inadequate and everyone who has studied the question admits it. (Have you studied it, so that you may no longer have to say as you are alleged to have done in re High Cost of Living, " God knows, I don't! "?) " It is the business of the National Government to provide a medium, automatically contracting and expanding in volume, to meet the needs of trade. Our present system lacks the indispensable quality of elasticity. (If it is the <( business " why avoid 39 the word "duty"? of the "National" Govern- ment to " provide " a medium, why does it not do sof Why is it proposed that the " National " Gov- ernment shall abdicate by delegating this great function to a private monopoly? Should DUTY ever be delegated?) " The only part of our ' monetary medium ' that has ' elasticity ' is the bank-note currency. (" Re- stricity" would have been the better word, for though the banks can restrict it at will, they can not yet expand it beyond the five hundred million limit quietly provided for in our first batch of asset- currency.) The ' peculiar provisions ' of the law (So " p ecu-liar" that the banks habitually evade them) requiring ' National ' banks to maintain re- serves to meet the call of the depositors (Blessed piece of impertinence for a depositor to want his deposit at any time!) operates to increase the money stringency when it arises rather than to ex- pand the supply of currency and relieve it. It operates upon each bank and furnishes a motive for the withdrawal of currency from the channels of trade (I am glad you admit the Government has made no provision for trade It is high time that it did) by each bank to save itself, and offers no in- ducement whatever for the use of the reserve ( The "Reserves" are used and re-used to the limit already) to expand the supply of currency to meet the exceptional demand (There is nothing " excep- tional " about the demand It is always there, even if generally latent). "After the ' Panic ' of 1907 (It is an ill wind that blows nobody good Did any Banks declare hun- 40 dred per cent dividends after this " panic "? What is a "panic"? And why?) Congress realized (They must have forgotten to take care of some- body) that the present system (Special Privilege vs public) was not adapted to the country's needs and that under it panics were possible ( Which ^vere less possible in lands where nnancers had perceived the folly of becoming wealthy too suddenly) that might properly be avoided by legislative provision (Have our " Law "-makers observed that we dangerously approach that " multiplicity of laws " which, as Solon advised Cyrus, evidences the corruption of a state?) Accordingly a monetary commission (A " National " Monetary Commission) was appointed which made a report in February, 1912. The sys- tem which they recommended involved a ' Na- tional ' (No There was nothing " national " about it, though it did involve the nation The repeated injection of this word " national " suggests the sus- picion always aroused by a too frequent use of the term " Honest ") Reserve Association, which' was, in certain of its faculties and functions, a bank, (You have studied the subject) and which was given through its governing authorities (The word " national " is avoided here Who was to ivork its Board of Directors?) the power, by issuing circu- lating notes for approval (Approved by whom?) commercial paper (The Government might sell its power of issue, but government itself could not grant the power to make them circulate The Wild-Cat banking days would be nothing by com- parison.), by fixing discounts, and by other methods of transfer of currency, to expand the supply of the monetary medium where it was most needed to pre- vent the export or hoarding of gold and generally to exercise such supervision over the supply of money in every part of the country as to prevent a stringency and a panic. (But these fellows depend upon stringency and panic for the periodical raids upon property, whence the hundred-per-cent divi- dends.) The stock (A stock-jobbing scheme, naturally) in this association (This piratical asso- ciation) was to be distributed (" Distributed " is the right word It can be demonstrated that it would not be paid for.) to the banks of the whole United States, State and ' National/ in a mixed (" Mixed " is the proper word.) proportion to bank units and to capital stock paid in (" Paid-in " is good.) The control of the association was vested in a board of directors to be elected by representatives of the banks, except certain ex officio directors (Ex ofKcio is also good their offices would be decidedly "Ex" ex-majority or ex-control.), three Cabinet officers, and the Comptroller of the Currency. (Which last the Bankers seem for years to have selected for appointment.) The President was to appoint the governor of the association from three persons to be selected by the directors. (They would content themselves with mere selection, leaving the full power of appointment of the party selected with the President.) The details of the plan were worked out with great care and ability (So was the plan of Ali Bab a), and the plan in general seems to me (Naturally Judges never have climbed otherwise than by siding against the people) to furnish the basis for a proper solution 42 of our present difficulties. I feel that the Govern- ment might very properly be given a greater voice in the executive committee without danger of in- jecting politics (The Banking Interests can take no chances on this Their "injections" have been per- force bi-partisan and it will be a great economy if they can be discontinued.) into its manage- ment, but I think the federation system of banks is a good one (Sure Everything is a Trust nowa- days.), provided proper precautions are taken to prevent banks of large capital from absorbing power through ownership of stock in other banks (Sure The inner rings are already cemented stop the extension But do you really mean it?) The objections to a central bank it seems to me are obviated if the ownership of the reserve association is distributed among all the banks of a country in which banking is free. (Free as the air " Legally " Only some do not benefit thereby.) The earnings of the reserve association are limited in percentage (Are the earnings of its constituent stockholders limit ed* also?) to a reasonable and fixed amount (Which the stockholders will take very good care they never exceed.) and the profits over and above this are to be turned into the Gov- ernment Treasury. (Oh just and righteous Judge Hast thou really studied the question or art thou merely blind? When has your Government ever made any profit in its dealings with the money-lenders?) It is quite probable that still greater security (Where is the security?) against control by money centers may be worked into the plan (" Worked into " the plan by whom The 43 "National" Monetary Commission "National" only in the scopeness of its intended scoop!) " Certain it is however ( You have shown no cer- tainty thus far, as against the dead-certainty of the money-lenders) that the objections which were made in the past history of this country (Have you "studied" our History too?) to a central bank, as furnishing a monopoly of financial power to private individuals (Here we get it "PRIVATE indi- viduals" are deemed more trust-worthy than our own Government.) would not apply to an associa- tion whose ownership is so widely distributed (Granting that Usury has spread and is spreading very rapidly, still those who have not studied the question as deeply as yourself doubt whether, after all, the working-control may not be slightly more restricted than you would have us believe.) and is divided between all the banks of the country, State and ' National ' (But you have already stated spe- cifically that it is rather " mixedly " divided.) on the one hand, and the Chief Executive through three department heads and his Comptroller (Why " his "? Do you select or only appoint this officer And is he not entirely independent of you?) of the Currency, on the other. (Thou wouldst almost persuade me to be a Jew!) The ancient hostility to a ' National ' bank ( You quite mistake, despite your study There never has been any hostility to a bank for the nation but always to the privilege to exploit the nation through a bank.), with its branches, in which is concentrated the privilege (Here you have it, if you could only see it It is the special privilege that the people you have so 44 misused the word " nation " object to.) of doing a banking business and carrying on the financial transactions of the government (This is indeed a PRIVILEGE but how can it be " free to all," as you said a little way back?) (Here we have also another word You must learn to distinguish "GOVERNMENT" from "people."), has' pre- vented the establishment of such a bank since it was abolished in the Jackson administration. (Jackson had not (f studied " the matter He was a mere observer One not to be fooled either by spoken or written word, and in this he seemed to have the people with him.) Our present * national ' banking law has obviated objections growing out of the same cause by providing a free banking system in which any set of stockholders can establish a na- tional bank if they comply with the conditions of ' the law.' (There has been a manifest attempt to raise the size of the ante, so as to make it a " gentle- man's " game, but we are still " free " just as free as we are to form any other Trust But one must hurry up, as even Peanuts have been bespoken.) It seems to me that the ' National ' Reserve Asso- ciation meets the same objection in a similar way; that is, by giving to each bank, State and ' National,' in accordance with its size, a certain share in the stock of the reserve association, nontransferable (Nontransferable makes no provision for posterity - There will be a final Bank, but she will get out of the " Game " before Bank-suicide gets in its deadly work.) and only to be held by the bank (Why do you always print " National " with a large " N " and bank with a small '' b " Is not the Nation transferring powers it feels itself too weak to wield ? 45 Put it "BANK" and "nation" if you are an ob- serving student!) while it performs its functions as a partner in the reserve association. (What are its functions to be? Are they clearly set forth in an unchangeable "CONSTITUTION/ 9 or part of mere By-Law, to be changed by the Governor at will?) Here I have to go to lunch in my wrapper. But the thing's interesting My God!, "What fools these mortals be! "