eus.

ESTABLISHED 1839
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Reg. U. S. Pat. Office

Volume 167 Number 46$6 New York, N. Y., Thursday, May 6,1948 Price 30 Cents a
Copy

The Threatened Human Freedom Rests on

RR. Strike and By DR. ALLEN B. DuMONT*

Feather-Bed Rules
Gold Redeemable Money President, Allen B. DuMont Laboratories, Inc.

By HON. HOWARD BUFFETT* Prominent television producer traces development of television and
By ELISIIA M. FRIEDMAN i1T:U. S. Congressman From Nebraska rV-v-'-iv
■ ■ its recent indicated by an increase from 200,000 re¬
rapid progres*,
Consulting Economist
Congressman Buffett stresses relation between
and freedom money ceivers at end of 1947, to
over 340,000 at present. Sees television
Three dissenting rail unions re¬ and contends without a redeemable currency, individual's freedom supplementing radio, and predicts eventual large television hook
ject Board's findings. But "feath¬ 7% to sustain himself or move his property is dependent on goodwill of ups, which will include small as well as large population centers.
er-bedding" not practiced on, politicians. Says paper money systems generally collapse and Does not foresee early price reductions in receivers, but looks for
New York
subways or British result in economic chaos. Points put gold standard would restrict continual improvement in sets
< and reduction in costs of transmis¬
railroads. Taft-Hartley Law pro¬
government spending and give people greater power over public sion. Concludes, within 5 to 10 years, television will be one of
hibits "feather bedding" and -
purse. Holds present is propitious time to restore gold standard. top industries.
should also cover rail workers. r:
Is there a connection between Human Freedom and A Gold Re¬ I was going to try to cover, today, in the time at my disposal, a
Three railroad unions are threat¬ deemable At first glance it would seem that money
Money? belongs little about what *has happened in television within the last few
ening strike May 11. They to the world of economics and human freedom to the political
a on sphere. years and maybe go back a little bit further than that to give you a
v,- dissent f r o m >. V But when you recall that one of the first moves by Lenin, Musso- little background on the subject and then, to try and take a peek
opinion of
:
\ an ■■;• lini, and 'Hit-3>—— '.■■■■•'. ■ ■" —— ,
•

■■
''7; <S 8S tO tlOW thiS
the President's
,

ler was to
EDITORIAL thing may de¬
Fact - Find^ outlaw indi¬
velop.. '
ing Board, vidual owner¬
I think that
which was ac¬
ship of gold, you might be
cepted by 19 you begin to interested to
other unions sense that know that the
conce r n i n g there may be television art
A Form of
the wage in¬ some connec¬ Escapism? ;r 7 and the idea
and in¬ tion between Those of who
crease us are a little older than we like to admit of television is
sist also on
money, r e- rather old. As
the * adoption deemable in
readily remember when the "flappers" of that day were
a m a t t e r of
of additional gold, and the Always chasing rainbows" or "blowing bubbles in the air"
fact, the orig¬
feather bed It may well be doubted whether the authors of such
-
Lie rare prize
popular inal i d e a of
rules. Those
songs had much more in mind than those who were respon¬
kn own as
scanning, as
would increase human 1 i b- it to¬
sible for "little lamsie
divy ,' and other nonsensical gibberish
we Use
by $1,- erty. costs
Elisha M. Friedman
which constituted the warp and woof of *fhe incantations day, is just 65
Howard Buffett
400,000,000. In Also, when .

years old. It Allen B. DuMont

the past their dissent had been ''V/V-'- you find that
of later generations. was originally
successful. The government re¬ Lenin declared and demonstrated proposed by an Austrian by: the
But "chasing rainbows" and "blowing bubbles in the
convened the judicial^ body to that a sure way to overturn the name of Nipkow, in 1883, and
air" has for something approaching a
satisfy the dissenters' demands. existing social order and bring generation appeared we still use that same principle
Where resides sovereignty—in the about communism was by print¬ to be a favorite pastime of the American
people. The same in breaking up the picture and
government'of 140,000,000 people, ing press paper money, then again habit may have taken hold of many other peoples,' too. transmitting it over a single radio
or in the leaders of three railroad impressed with the pos¬
Certainly it sometimes appears as if it" had. As to ourselves,
you are _

(Continued on page 43)

unions, engineers, firemen and sibility of a relationship between
switchmen, representing 150,000 a gold-backed money and human however, there can be
gainsaying the fact that continu¬
no
^'Stenographic report of an ad¬
workers? This is the large issue freedom. * > ous, if not organized self-deception — usually inspired by
that confronts the country.
dress by Dr. DuMont at Luncheon
; : £ In that case then certainly you some resonant "radio voice" has apparently become a —
Meeting of the New York Finan¬
Present Railroad Feather-Bed and I as Americans should know fixed habit which virtually nothing can break. S ;> cial Advertisers, New York City,
Demands the connection. We must find it
The April 28, 1948.
(Continued on page 46)
frequently mentioned example at the
most
The railroad unions have de- \

present moment is, of

-

course, our "disappointment" in

(Continued on page 47) *An address by Russia and the Kremlin.
Congressman Precisely how we could ally
,
,

Buffett before the Conference of

ourselves with one of the world's most notorious despots
American Small Business Organ¬
izations, Washington, D. C., May
(Continued on page 38) *
State and
4, 1948.'
Havana
Municipal
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Established
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J U:. Genera (Representative)

NEW ISSUE

For Banks, Brokers and Dealers Wisconsin Power

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CANADIAN
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 46 (2018) THE COMMERCIAL & FINANCIAL CHRONICLE Thursday, May 6, 1948

ber had risen to the fantastic the people will almost certainly

Human Freedom Rests on Gold Re deemable Money total of 14,416,393 persons.

This '14V2 million figure does

flock to. "a man on horseback"'
who says he wJl stop inflation
Fort by price-fixing, wage-iixing, and
(Continued from first page)
Knox, that gold is not sub¬ generally no one gives up power not include about 2 mill/on re¬
rationing. \Wnen currency loses
even if money is a difficult and ject to demand by American cit¬ willingly. ' ceiving either unemployment ben-
izens. It could all be shipped out its/exchange vaiue the processes
tricky subject. I suppose that if
Remaps right now say¬
you are * . so**, conservation checks.
of production and distribution are
of this country without the peo¬ ing to yourself: "That's just what However, it includes about. ,2
most people were asked for their
demoralized. / -
views on money the almost uni¬ ple having any chance to prevent getting schooling or
i nave aiways thought. The poli¬ million GI's
For example, still have rent-
versal answer would be that they it// That is not probable in the
ticians are thinking of votes when on-the-job-training. Excluding we

near future, for a small trickle of they ought to think about the them, the total is about 12 V2 mil¬ fixing and rental, housing remains
didn't have enough of it. ;
a desperate situation.
gold is still coming in. But it can future of the country. -What we lion or -500% more than in 1932.
In a free country the monetary
happen in the future. This gold is need is a Congress ^ith some If each beneficiary accounted for For a
long time shrewd people
unit rests upon a fixed foundation
.
.

temporarily and theoretically par¬ 'guts/ If* we elected a Congress four/votes (and only half ex¬ have been quietly hoarding tan-*
of gold or gold and silver inde¬
tial security for our paper cur¬ with intestinal fortitude, it would hibited this payroll allegiance gibles one in
way or another.
pendent of the ruling politicians.
rency. But in reality it is not. stop the spending all right!" ,/ response) this group would ac¬ Eventually, this individual move¬
Our dollar was that kind of
count for 25 million votes, almost ment into tangibles will become a
Also, currently, we are enjoy¬ I went to Washington with ex¬ ■

money before 1933. Under that by itself enough votes to win any general stampede unless correc¬
ing a large surplus in tax reven¬ actly that hope and belief. But I
system paper currency is redeem¬ national election. tive action
ues, but this happy condition is have had to discard it as un¬ comes soon. ' ,h
able for a certain weight of gold,
,,

only a phenomenon of postwar in¬ realistic. Why? Because an econ¬ Besides these
payroll direct
at the free option and choice of Is Time Propitious
the holder of paper money.
flation and our global WPA. It omy Congressman under our voters, there are a large number
of State, Most opponents of free coinage
cannot be relied upon as an ac¬ printing-press money system is in county and local em¬
of gold admit that that restoration
».
Redemption Right Insures curate gauge of ourfinancial con¬ the position of a fireman running ployees whose compensation in
is essent.al, but claim the time is
. . *
Stability * dition. So we should disregard into a burning building with * a part comes from Federal subsidies
{he current flush treasury in con¬ hose that is not connected with and grants-in-aid. ;;
not propitious. Some argue that
That redemption right gives there would be a scramble for
sidering this problem. the water plug. His courage may Then there are other
money a large degree of stability. many
gold and
be commendable, but he is not kinds of
our enormous gold re¬
The owner of such gold redeem¬ From 1930-1946 your govern¬ pressure groups. There
serves would soon be exhausted.
hooked right at the other end businesses that
-

able currency has economic inde¬ ment went into the red every up arc are being en¬

and the debt steadily of the line. So it is now with riched by national defense snend- Actually, this argument simply
pendence. He can move around year
mounted. Various a Congressman working for econ¬ ing and foreign handouts. These points up the case. If there is so
either within or without his coun¬ plans have
little confidence in
try because his money holdings been
proposed to reverse this omy. There is no sustained hook¬ firms, because of the money they our currency

with the taxpayers to give him can propaganda, may be

spend that restoration of gold coin
have accepted value anywhere. spiral of debt. up on
the most dangerous of all. would cause our gold stocks to
of strength.
.

example, I hold here what

For One is that a fixed amount
When the V the Marshall Plan meant $100 disappear, then we must act
is called a $20 gold piece. Before tax revenue each year would go people's right to. re¬
million worth of profitable busi¬
promptly.
1933, if you possessed paper for debt Another is strain public spending by demand¬
reduction.
ness for your firm, wouldn't you
The danger was recently high¬
money you could exchange it at .hat prohibited by ing gold coin was taken from
Congress be
statute from appropriating more them, the/ automatic flow of invest a few thousands or so to lighted by Mr. Allan Sproul, Pres¬
option for gold coin.,
your This
ident of the Federal Reserve Bank,
/'gold coin had a recognizable and than anticipated revenues in strength from the grass-roots to Successfully propagandize for the
enforce economy in Washington Marshall Plan? And if you were of New York, who said:
definite value all over the world. peacetime. .Still another is that ,

10% of the taxes be set aside each was disconnected. I'll come back a foreign government, getting "Without our support (the Fed-*
It does so today. In most coun¬
for debt reduction. / to this later. billions, perhaps you could oer- eral Reserve System), under pres¬
tries of the world this gold piece, year
In suade your prospective suppliers ent conditions, almost any sale of
if you have enough of them, will All of these proposals look January you heard the Presi¬
dent's message to here to lend a hand in putting government Donas, undertaken for
give you much independence. But good. But they are unrealistic Congress, or at
least you heard about it. that deal through Congress. whatever purpose, laudable or
today the ownership of such gold under our paper money system. It made
otherwise, would be likely to find
pieces as money in this country, They will not stand against post¬ Harry Hopkins, in memory, look
Taxpayer the Forgotten Man an almost bottomless market on
Russia, and all divers other places war spending pressures. The ac¬ like Old Scrooge himself.
is outlawed. Far awav from Congress is the the first day support was with¬
curacy of this conclusion has al¬ Truman's State of the Union
real forgotten man, the taxpayer drawn."
The Hitler or a
subject of a ready been demonstrated. message was "pie-in-the-sky" for
•who foots the bill. He is in a Our finances will never be
Stalin is
the mere fact
a serf by everybody—except business. These
The v Budget and Paper Money different spot from the tax-eater brought into order until Congress/
that his money can be called in promises were to be expected un¬
Under the or the business that makes mil¬ is compelled to do so. Making
and .depreciated at the whim of stream-lining Act der our paper currency system/.
lions from spending schemes. He our money redeemable in gold
his rulers. That actually happened passed by Congress in 1946, the Why? Because his continuance in
Senate and the House cannot afford to soend his time will create this compulsion. /
in Russia a few months ago, when were re¬ office depends upon pleasing a
the Russian people, holding cash, quired to fix maximum budget
a majority of the pressure groups. trying to oppose Federal expen¬ The
paper money disease has
each year. In 1947 the Senate and ditures. He has to earn his own
been
had to turn it in—10 old rubles Before pleasant habit thus far and*
a
you judge him too
and receive back one new ruble. the House' could not reach an living and/ carry/ the burden of will not be dropped voluntarily •
harshly for that/ pe'rfohnance, taxes/as well.
*

I hold* here small

•agreement om this maximum let any more than a dope user will;
a packet of us speculate on his think¬
budget so that the law was ig¬
> But for most beneficiaries a without a struggle give up nar¬
this second kind of money—print¬ ing. Certainly he
*

c a n p er-
nored. Federal paycheck soon becomes cotics. But in each case the end'
ing press paper money—technically the Republi¬ suade • himself /that
known as fiat money because its On March 4 this year the Mouse cans would do the same vijtal in his life. He usually will of the road is not a desirable
thing if
value is arbitrarily fixed by rul- and Senate agreed on a budget of they were in power. Already he spend / his full energies if neces¬ prospect.

. ers or statute. The amount of this $371/2 billion. Appropriations al¬ has characterized our talk of econ¬ sary to hang onto this income. I can find no -evidence to sup¬
ready The taxpayer is completely out¬
money in numerals is very large. passed or on the docket omy as "just conversation."* To port a hope tqac our tiat oaoer
This little packet amounts to CNC will most certainly take expend¬ date we have been proving him matched in such an unequal con¬ money Venture will fare better
$680,000. It cost me $5 at regular itures past the $40- billion mark. right. Neither the President nor test, Always heretofore he ultimately than such experiments
exchange rates.* I understand I The statute providing for a maxi¬ the Republican Congress is under possessed an equalizer. If gov¬ in other lands. Because of our

got clipped on the deal. I could mum budget has fallen by the real compulsion to cut Federal ernment finances weren't run economic treng t h the paper
s

have gotten $2% million if I had wayside even in the first two spending. And so neither one does according to his ide^ of soundness money disease here may take
it has been he had an .individual right to
purchased in the black market. years operating and so, and the people are ' largely many years to run its course.
But you readily see that this in a period of prosperity. protect himself by obtaining gold.
can helpless. But we can be approaching the
Chinese money, which is a fine There is With restoration o* the goH critical stage/.
only one way that But it wag riot always this way. a
When that day /ar¬
grade of paper money, gives the these spending pressures can be standard, Congress would have to rives, our, political rulers will
Before 1933/ the people them¬
I individual who owns it no inde¬ halted; and that is to restore the selves had an effective again resist handouts. That wdnl »
oab'v f'iua mat foreign war
way to de¬
pendence, because it has no re¬ final decision on public spending work this wav.' If Congress and ruthless regimentation is the
1933, when¬ mand economy. Before
demptive value. to the producers of the nation. ever seemed receptive to reckless cunning alternative to domestic
the people became disturbed
Under such conditions the indi¬ The producers of wealth—taxpay¬ spending scnemes, depositors' de¬ strife. That was the way out for
oyer Federal spending, they could
vidual citizen is deprived of free¬ ers—must regain their right to ob¬ mands over the coqntrv for gold the paper-money economy of Hit¬
gq to the banks, redeem their pa¬ would become serious. That
dom of movement. He is pre¬
tain gold in exchange for the soon ler and others.
per currency in gold, and wait
sented from fruits of their labor. This restora¬ alarm in turn would quickly be
laying away purchas¬ for common sense to return to
theF* remarks I have only,
tion would give the reflected in the halls/of Congress.
ing power for the future. He be¬ people / the touched the high points of this/
Washington. The legislators would' learn from
dependent final governmental
comes upon the good¬ say-so on problem. I hope that I have given//
will of the politicians for his spending, and would enable the banks back home and from
daily Raids on Treasury you enough information to chal-'
bread: wealth producers to control the the Treasury officials/that confi¬
Unless he lives on land lenge you to make a serious study
.That happened on various occa¬
that will sustain him, freedom for issuance of dence in the Treasury was en¬
paper money and sions of it.
and conditions sometimes dangered.
bonds/
,

him does not exist.

became strained, but nothing oc¬
I warn you that politicians of
I do not ask you to accept this Congress would be forced to
v i You have heard a lot of oratory curred like the ultimate conse¬ both parties will oppose the res¬
inflation from politicians in contention outright. confront spending demands with
on But if you quences of paper money inflation. toration of gold, although they
both parties. look at the political facts of life, firmness. The gold standard
Actually that ora¬
.

I think
/Today- Congress is constantly acted as a silent watchdog; to may outwardly seemingly favor
tory and the inflation maneuver¬ you that this will agree
action is the only genuine cure. '
besieged by minority groups seek¬ prevent unlimited public/spend¬ it. Also those elements, here and
ing around here are mostly sly
ing benefits from the public treas¬ ing; abroad-
efforts designed to lay the blame There is
* ./
/'•/// who-are/ getting rich frojm
aparallel between bus¬ ury. Often these groups^ control
on the other party's doorstep. iness I haveonly briefly outlined the the continued American inflation;
All and politics which quickly enough in
votes many Congres¬
our politicians regularly announce illustrates the weakness in po¬ sional districts to change the out¬
inability of Congress to resist will oppose a return to sound,
/their intention to stop inflation. I litical /control of money;/ soending pressures d'»nug pe¬
come of elections. : And so Con¬
riods money. You must be prepared toy
/believe I can show that until they
of prosperity; What: Con¬
Each of you is in business to gressmen find it difficult to pur- meet their opposition intelligently
move to restore your right to own
gress would do when a depres¬
make profits. If your firm does suade themselves not to give, in
•gold;that talk is hogwash. / sion is a question I leave
comes and vigorously. They have had
not make profits, it goes out of to pressure groups. With no bad to your imagination. 15 years of unbroken victory.
business. bring a immediate
If I wereconsequenceto it be¬
Paper Systems End in Collapse I have not time to
product to you and say, this item comes expedient to accede to a portray the But, unless you are willing to
; But first let me clear end of the road of all paper money
away a is..splendid for your customers, spending demand. The Treasury surrender your children and your
bit of underbrush. I will not take but you -would have to sell it
experiments.
is; seemingly
time to review the
history of pa¬
inexhaustible. Be¬ It is worse than just the high
country to galloping inflation,,
without profit, at loss
or even a sides the unorganized taxpayers /and / slavery,/then •. this
per money experiments. So far prices that you have heard about. war cause/;
I that would put you out of busi¬ back home
as
discover, paper money
can may not notice this Monetary chaos was followed in demands your support. For if
systems have always wound up ness—well, I would get thrown particular expenditure—and it Germany by a Hitler; in Russia human
so liberty is to survive in
with collapse and economic by all-out Bolshevism;
chaos. out of your office, perhaps po¬
and in
goes. America, we must win the battle
Here other nations by more less
somebody might like to litely, but certainly quickly. Your
or
Let's take a quick look at/ just to restore honest money.
tyranny. It can take a nation to
interrupt and ask if we are not business must have profits. the payroll pressure elements. On communism without external in¬ There is no more/important
now on the gold standard. That In politics votes have a similar June 30, 1932, there were 2,196,151 fluences. frugal Suppose .the challenge facing us than this is¬
is true, internationally, but not vital importance to an elected of¬ people receiving regular monthly
savings of the humble people of
sue—the restoration of your free-/
domestically., Even America continue to deteriorate
though there ficial. That situation is not ideal, checks from the Federal Treas¬
in the next 10 years as they have
dom to secure gold in exchange
is a lot of gold buried down at but it exists, probably because ury. On June 30, 1947, this num¬ in the past 10 years? Some day j for the fruits of your labors.

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