Mr. BRADFORD. I feel the same way, that this power should not be continued. It does not seem to me that anything is going to happen that will require any further depreciation of the dollar. If anything should happen, it would have to be a world catastrophe, and then the Congress itself should determine the value of the dollar, rather than have that determination made by any individual.

Mr. PARSONS. I think that the illustration that the Secretary of the Treasury gave as to conditions that existed last fall is sufficient evidence to warrant the extension of the powers, because those conditions may arise again.

Mr. LUCE. To which power do you refer; the stabilization or the gold purchase?

Mr. PARSONS. Both the stabilization and the revaluation of gold. The Secretary spoke of that matter off the record. I can easily conceive of a condition that might exist again that would make it necessary to utilize these powers that are being requested. The Secretary told us they would probably not be used, and that he did not expect to use them except in case of an emergency to defend the economics of the United States.

Mr. LUCE. I am not disposed to stress opposition to the continuation of the stabilization power. What disturbs me is the constant addition to this useless stock of gold. I am wondering what condition could arise in which it might be desirable to have this gold on hand.

Mr. PARSONS. If I understand the gentleman from Massachusetts, he is not opposed to the continuation of the stabilization fund and its operation, but he is opposed to the delegation of power or the extension of power to further devalue the gold dollar.

Mr. LUCE. That looms largest in my mind.

The CHAIRMAN. If I may interrupt, it is now 15 minutes past the meeting time of the House.

Mr. WHITE. You spoke of the adverse effect of the Silver Purchase Act. During the operation of that act, did you not have the highest price level in the United States ever experienced, the best prices for cotton and wheat we ever had?

Mr. BRADFORD. Do you refer to the last one, the one of 1934?

Mr. WHITE. Two million ounces were bought from the United States. Going back to that time, did we not have the highest price level for cotton and wheat that we ever had?

Mr. BRADFORD. We had the highest prices between the time the silver was sold and the time it was replaced, between 1918 and 1920.. The peak was reached in 1920. The following crisis was due to wartime inflation. I do not think that silver had anything to do with it. Mr. WHITE. But while that purchasing was being done we did have the best prices for commodities we have ever had in this country. Mr. BRADFORD. Most of the purchases did not take place until after 1920.

Mr. WHITE. Can we have the subscription list of the Economists' Naitonal Committee on Monetary Policy made a part of the record? Mr. BRADFORD. Subscribers have been told that their names will not be made public. Their names could be made public only by threefourths action of the executive committee.

The CHAIRMAN. The list is not available?

Mr. BRADFORD. The list is not available.

Mr. WHITE. I make a request that it be obtained and be made a part of the record.

The CHAIRMAN. We have not had time to hear Mr. Beckhart this morning; therefore I suggest that he come back Friday, if that be acceptable to members of the committee. It will be necessary for us to adjourn for the day.

Mr. BRADFORD. Before we adjourn I should like to state that I believe it would be desirable, if the life of the stabilization fund is extended, that control of the operations of this fund be invested in the Board of Governors of the Federal Reserve System, since it seems obviously desirable that control over currency and credit policy be in the hands of a single authority. At present, powers are too much divided between the Board and the Treasury, with the Treasury holding the advantage. I believe it would be desirable to concentrate control in the hands of the central banking authorities, where it should properly rest.

Mr. ANDRESEN. I ask that the statement of the Economists' National Committee on Monetary Policy be included in the record. The CHAIRMAN. In absence of objection, it is so ordered.

ECONOMISTS' NATIONAL COMMITTEE ON MONETARY POLICY, EDUCATIONAL BUILDING, 70 FIFTH AVENUE, NEW YORK CITY-55 MEMBERS RECOMMEND TERMINATION OF PRESIDENT'S POWER TO DEVALUE THE DOLLAR

The Gold Reserve Act of January 30, 1934, gave the President the power to reduce the gold content of the dollar by not less than 40 percent and not more than 50 percent, and, thereafter, at his discretion, to change the weight of the dollar within the specified limits. This provision was to be in effect for 2 years, with the possibility of its extension for an additional year by proclamation by the President should he think such extension desirable.

The President extended this provision for the additional year as authorized in the Gold Reserve Act. Shortly before that year elapsed Congress, at the request of the administration, further extended the provision to June 30, 1939. On January 19, 1939, the President again requested the extension, until January 15, 1941, of his present power to devalue the dollar.

There are no adequate reasons for further extension of the President's power to change the gold content of the dollar. Since the devaluation of the dollar in January 1934 was close to the minimum specified in the Gold Reserve Act, any further alteration in the weight of the dollar would necessarily be in a downward direction. Further devaluation would be opposed to the best interests of the country and should not be permitted. Continuance of the President's authority to devalue the dollar still further implies that there are sound reasons for a better or stronger currency pursuing a weaker one in its downward course, whereas no such sound reasons exist.

[In reply to the frequently heard argument that depreciating foreign currencies might suggest the desirability of continuing the power of the President to lower the gold content of the dollar, we wish to call attention to the fact that during the period from 1919 to 1923, when the pound was unstable, when the French and Belgian francs and the Italian lira were falling rapidly in value, and when the German mark was plunging toward a trillionth of its former value, the dollar remained firmly anchored to gold at an unchanged weight. This firmness of the dollar was both a source of great strength to this country and a stabilizing factor in the world economy.] If any adequate reason for devaluating the dollar should arise in the near future, a situation which is difficult to envision considering our huge supply of gold, it should be done by act of Congress, as provided by the Constitution, and not by an administrative order of the President.

The Economists' National Committee on Monetary Policy has repeatedly taken a stand against any further devaluation of the dollar. The undersigned members of the committee, in reaffirming their conviction that further devaluation is opposed to the best interests of the country, hereby recommend to the Congress that it rescind immediately its delegation to the President of its constitutional power to change the gold content of the dollar.

ECONOMISTS' NATIONAL COMMITTEE ON MONETARY POLICY, EDUCATIONAL BUILDING, 70 FIFTH AVENUE, NEW YORK CITY-56 MEMBERS RECOMMEND INVESTIGATION OF OPERATIONS OF STABILIZATION FUND

The Gold Reserve Act of January 30, 1934, provided for a stabilization fund of $2,000,000,000 to stabilize the exchange value of the dollar. The life of this fund was to be 2 years, with the possibility of its extension for an additional year by proclamation of the President should he deem such extension desirable. The President extended the life of the stabilization fund for the additional year authorized in the Gold Reserve Act. Shortly before that year elapsed Congress, at the request of the administration, further extended its life to June 30, 1939. On January 19, 1939, the President again requested the extension, until January 15, 1941, of the life of the stabilization fund.

Since the operations of the stabilization fund have been shrouded in secrecy, it is not possible to determine the extent and significance of the uses of the fund, or the desirability of continuing it. It is both important and necessary, therefore, that Congress investigate the operations of this fund, and the desirability of its continuation; that it require, hereafter, the operators of the fund to make periodic reports to Congress, and that it determine whether such reports should not be made public.

Signed: James W. Angell, Columbia University; Charles C. Arbuthnot, Western Reserve University; Leonard P. Ayres, the Cleveland Trust Co.; Don C. Barrett, Haverford College; Benjamin Haggott Beckhart, Columbia University; James Washington Bell, Northwestern University; Ernest L. Bogart, University of Illinois; Frederick A. Bradford, Lehigh University; Herbert M. Bratter, Washington, D. C.; J. Ray Cable, Washington University; Wilbur P. Calhoun, University of Cincinnati; Neil Carothers, Lehigh University; Edward H. Collins, New York Herald Tribune; Charles A. Dice, the Ohio State University; George W. Dowrie, Stanford University; William E. Dunkman, the University of Rochester; D. W. Ellsworth, the Annalist; William D. Ennis, Stevens Institute of Technology; Charles C. Fichtner, University of Arkansas; Clyde Olin Fisher, Wesleyan University; J. Anderson Fitzgerald, the University of Texas; Herbert F. Fraser, Swarthmore College; Roy L. Garis, Vanderbilt University; Earl J. Hamilton, Duke University; Lewis H. Haney, New York University; E. C. Harwood, American Institute for Economic Research; Hudson B. Hastings, Yale University; William F. Hauhart, Southern Methodist University; Frederick C. Hicks, University of Cincinnati; John Thom Holdsworth, the University of Miami; Jacob H. Hollander, the Johns Hopkins University; F. Cyril James, University of Pennsylvania; Edwin W. Kemmerer, Princeton University; Frederic E. Lee, University of Illinois; Ray V. Leffler, Dartmouth College; J. L. Leonard, University of Southern California; James D. Magee, New York University; A. Wilfred May, New York City; Margaret G. Myers, Vassar College, Melchior Palyi, the University of Chicago; Ernest Minor Patterson, University of Pennsylvania; Clyde W. Phelps, Chattanooga University; Charles L. Prather, Syracuse University; Howard H. Preston, University of Washington; Leland Rex Robinson, New York City; Olin Glenn Saxon, Yale University; Joseph A. Schumpeter, Harvard University; Walter E. Spahr, New York University; William H. Steiner, Brooklyn College; Charles S. Tippetts, University of Pittsburgh; Alvin S. Tostlebe, the College of Wooster; Rufus S. Tucker, Westfield, N. J.; Russell Weisman, Western Reserve University; William O. Weyforth, the Johns Hopkins University; Nathaniel R. Whitney, the Procter & Gamble Co.; Max Winkler, College of the City of New York.

The CHAIRMAN. The committee will now adjourn to meet next Friday at 10:30 o'clock a. m.

(Thereupon at 12:30 o'clock p. m., Wednesday, March 8, 1939, the committee adjourned, to meet at 10:30 o'clock a. m., Friday, March 10, 1939.)

EXTENSION OF STABILIZATION FUND AND POWERS, ETC.

FRIDAY, MARCH 10, 1939

HOUSE OF REPRESENTATIVES,

COMMITTEE ON COINAGE, WEIGHTS, AND MEASURES,

Washington, D. C.

The Committee met at 10:30 a. m. for further consideration of H. R. 3325, Hon. Claude V. Parsons presiding.

Mr. PARSONS. The committee will come to order, please. Under the pre-arranged schedule, Dr. Benjamin H. Beckhart is to be heard this morning. Dr. Beckhart submitted a statement to the committee at the last meeting, but probably the members have not had an opportunity to get to read a great deal of it. If it is satisfactory to the committee I suggest that we let Dr. Beckhart proceed with his statement, and if the members of the committee have any questions they desire to ask they may then ask them as he progresses with his statement.

Mr. EBERHARTER. Mr. Chairman, it would probably be just as well not to have Dr. Beckhart read this entire statement, but to have it inserted in the record in the interest of saving time.

Mr. PARSONS. It has already been offered for the record, and the members of the Committee are to be afforded the opportunity of interrogating Dr. Beckhart this morning. If they have not had the opportunity to read the statement, of course they will not have in mind the questions they desire to ask him, not having gone over the statement.

Mr. WHITE. I would suggest that Dr. Beckhart read his statement. At least I have not had an opportunity or the time to read his statement. I think it better be handled by Dr. Beckhart in that manner if it is agreeable to the committee. How long do you think it will take you to read your statement, Dr. Beckhart?

Dr. BECKHART. I should say about 20 or 30 minutes.

Mr. PARSONS. Yes. Then, if the members of the committee desire to ask you any questions we will have the text before us, and we can follow your statement, and if there are any questions to be asked he can be interrupted or asked questions at the close of his statement. Dr. BECKHART. Yes, sir; that is perfectly agreeable.

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