lp4guld

We must take note here of the plans that are being made for ournew order. Under our Constitution the authority of the federalgovernment is very severely restricted. However, the federal government,beginning around 1881, has been slowly extending itspower under the general-welfare clause, the interstate-commerceclause, and the so-called "inherent-rights-of-sovereignty" theoryduring times of emergency. If you will consult the various actsunder which the national government has usurped so many powersyou will see it is always done under one of these guises. If the general-welfareor the interstate-commerce clauses are not adequateexcuse for the invasion, the assumption of emergency will do thework. But generally the proposal to pay federal money to the tuneof hundreds of millions into the states or to relieve the states oftheir own fiscal burdens is sufficient to paralyze all resistance to theinvasion. Thus the government, under a color of constitutionalobservance, has enormously stretched its power over a vast terrain.However, there is a limit even to this sort of thing. Hence somenew means of control must be invented. And these means havebeen found.A great Wall Street banker who does not own a share of stockin a railroad or utility company and who has no constitutional grantof power to regulate it may, nevertheless, acquire over it an almostautocratic power. He can dictate its policies, name its officials, andelect its directorate. One of the great problems of the last fiftyyears has been the ascendency of a few powerful banking housesover our railroad and utility systems. This they acquired first bycapturing control of the pools of national savings—the banks andthe insurance companies and finance companies. They could withholdor grant financial aid to these industrial corporations. Theycould make available on short notice funds for stock and bondissues by the companies in sums they could get in no other way.Now the President's planning groups have been outlining theprogram of the administration to become the partner or financieror both of transportation, communication, shipping, shipbuilding,radio, basic metals, and other enterprises. By these means it willunite to the vast powers it exercises by political agencies thosealmost equally great powers it may exercise as investor and banker.*43