The Bismarck Tribune Newspaper, October 6, 1919, Page 4

THE BISMARCK TRIBUNE Entered at the Postoffice, Bismarck, N. D., as Second Class Matter) GEORGE D. MANN, - : - : Foreign Representatives G. LOGAN PAYNE COMPANY, CHICAGO, - - - - DETROIT, Marquette Bldg. - - - Kresge Bldg. PAYNE, BURNS AND SMITH NEW YORK, : - - Fifth Ave, Bldg. “ MEMBER OF ASSOCIATED PRESS The Associated Press ) entitled to the use for publication of all new rwis' credited in this paper and also the local news published herein. All rights of publication of special dispatches herein are also reserved. : ie MEMBER AUDIT BUREAU OF CIRCULATION SUBSCRIPTION RATES PAYABLE IN ADVANCE Daily by carrier, per year .... $7.20 Daily by mail, per year (In I Daily by mail, per Daily _by_mail, outside of North Dakota. . THE STATE’S OLDEST NEWSPAPER (Established 1873) GOVERNOR FRAZIER SPEAKS Breaking an air-tight silence of several days, Governor Frazier accuses William Langer and Thomas Hall of wrecking the Scandinavian-Ameri- ean bank because of political pique. His state- ment published in Sunday’s issue of the Courier- News, the official organ of the Nonpartisan league, sounds very much as though it had been written in the Fargo league office, forwarded under first class mail to Bismarck with the com- mand that Mr. Frazier sign on the dotted line. The chief executive of this state either wilfully ignores the fundamental aspects of the affair or else his own bank examiners are’ inefficient pup- pets who should be discharged without delay. The examiners’ statement bares a condition that should not and can not long be tolerated in any state where even a semblance of orderly gov- ernment exists. ; Governor Frazier, in one breath, insists that the Fargo bank is not insolvent and that it will meet all its obligations. In the absence of any financial statement from the chief executive, this is merely an unsupported opinion as insubstantial as some of the collateral which it is alleged clutters up the vaults of the league bank. But in the next breath, the governor assures the depositors that they will not lose a penny be- cause the state guaranty act adequately protects them. It is not known whether Governor Frazier urges this statute in mitigation of wild cat bank- ing or not. But the finality with which he disposes of the entire affair, is quite characteristic of his perennial optimism whenever Mr. Townley’s finan- cial capers are at issue. The people of North Dakota, however, do not share Mr..Frazier’s optimism. Enough, has been uncovered by the legal department of this state to warrant the most searching investigation, not only of the Fargo league bank but into the method of operation of any bank which caters to the league’s enterprises. Governor Frazier does not seem to appreciate | that the credit of the state is at stake and that it will not be wholly restored until the banks con- trolled by the league promoters are thoroughly purged of doubtful and unsafe collateral. This affair cannot be dismissed by Governor Frazier’s fiat that it is in essence a fight against the farmers or their cause. It is really an under- taking in their behalf. Frazier’s defense is the old familiar cry when- ever the white light of publicity beats in upon a shady practices. Whether it will avail in this in- stance remains to be seen. It is high time to insist that the state banking laws be observed. Governor Frazier cannot deny that loans were made by the Fargo league bank in defiance of the limits set by those laws. He evades that issue entirely and sets up a purely political defense in easily detected Townley ver- biage. Because depositors are safe from loss, is no defense of wild cat banking. It is true, the state , protects depositors against the losses arising from unsound banking. But when Governor Frazier says there is no cause for alarm because the state has provided such protection, he begs the whole ie and convicts himself of the worst kind of political chicanery. There is much cause for alarm if conditions are as serious as the league’s own bank examiners have reported to their chief, Governor Lynn J. Frazier. Doubtless there are many blind followers of Governor Frazier and Arthur C. Townley who desire to turn over their resources to the league ; management and waive all banking restrictions. Jf Governor Frazier in his statement speaks for them alone, we have no quarrel with him. Every thirty-third degree leaguer who so desires has a perfect right to entrust his money to the league school of finance, but there are a few people in the state of North Dakota who insist upon a more orderly system of banking than seéms to have been practiced in the mother institution of the ‘league at Fargo. Whether political animosity actuated Mr: Lan- _ger and Mr, Hall is not at issue. Neither can that be urged by Governor Frazier in defense of condi- ‘tions which are said to have existed in the Scan- dinavian-American bank prior to the closing of its doors. , It'is high time to insist that the laws ) “of the state be upheld and that men who have vio- lated them be adequately and speedily punished. Ea Townley and his cohorts still persist that en- 0 population would be about the same. lateral was handled in anything but a benign spirit by the league “financiers.” The gold brick industry in this state is slipping. POPULATION AND IMMIGRATION Statisticians have been strangely puzzled to ac- count for the fact that in American history immi- gration has apparently had little effect on the rate of increase of population, That rate-was approxi- ;|mately the same in the years prior to 1830, when immigration was almost negligible, as during the first years of the present decade when nearly two million immigrants entered our ports yearly. Sociologists declare that had the founders of the nation closed the ports to immigration present Whether such a homeogeneous citizenship would have been _j preferable to the product of the melting pot can never be determined with unanimity and certainty. Immigration is again almost negligible, and has been so for the past five years. It is probable that immigration will not much exceed emigration tor the next twelve months. Moreover there is much objection to leaving the doors so wholly un- guarded as in the past. Will this mean a decline in population growth, or will the result be, as in earlier years, an added native growth due to relief of economic pressure? In any case we are learning that proper care will add more years to the lives of present citizens than immigration would bring. Even if the birthrate refuses, as it has never before refused, to respond to better living condi- tions, we can nevertheless add some 300,000 lives each year by reducing our general infant death rate to the point proper care has already reduced it in many places. Many more years could be garnered from an easily achieved reduction in the number of those killed and crippled in industry. Each year this industrial casualty list is more than twice as large as the casualty list of the entire American expedi- tionary force. Unless all the lessons of the past are false, rent profiteering, overcrowding and generally shameful housing conditions, with discrimination against families with children today cut off more lives than came in yesterday at Ellis Island. Attention to housing will increase population quicker than bonuses to manufacturers. Filling present lives with more and healthier years will swell the census statistics as readily as immigration. Adding ten years to the life of an adult is better than encouraging the birth of two infants that die in their first year or bringing in an immigrant to be killed in industry. Insurance actuaries who have studied the health of our industrial workers say that the gen- eral adoption of measures already in force in many industries would add 300,000 healthful years an- nually to the population. The machinery is ready to raise a crop of such healthful years. The object of war is to kill, but it taught much about saving life. The American Red Cross was the wonder of the war. Its far- flung battle line fought for health and strength in yemote corners of the earth, not only against wounds of the war, but against famines, pestilence and ignorance. These trained fighters for health are now com- ing back. With them are coming a host of physi- cians with army experience in the possibility of safeguarding life. They will find here a new in- terest in health matters. The Red Cross training class drilled a multitude for a health crusade. These forces, backed by an awakened public morale in health matters can add the years of healthful lives America needs. ; CARE Too many Liberty bonds are being lost, mis- placed or stolen. Most of us are careless in their handling. Liberty bonds are kept in store and office safes with doors open and in-unlocked drawers; men carry them in their pockets, women in their hand- bags, and even large financial institutions send them through the streets in open packages by irre- sponsible messenger boys. Hardly a week goes by that this newspaper does not recount the brief, Coal Oil Johnnie-like career of some lad who has sold Liberty bonds en- trusted to his care. BISMARCK: DAILY TRIBUNE | NEWEST SCANDAL Widespread Approbation for NORTH DAKOTA BANK METHODS Exactly a8 was expected, the def ers of the so-called “Nonparti league” bank, the legal name of which is the Scandinavian-Americap bank of Fargo, whose doors have been closed by the North Dakota state banking board, charge that the#etion of the state of- ficlals was due -to a “conspiracy to wreck the bank for political purposes.” Attorney General William Langer i Secretary of State Thomas Hall, a spokesman for the league, enemies of the Nonpartisan They formed the plot to close the Scandinavian-American bank — some ago.” usual, every official move aga “are league. tatives, wherever staged, to hold the league leaders within. the law and to punish them for breaches of the law is denominated. as political persecution. If any executive official, peace officer, judge or court, inthe discharge of ot- ficial duties, runs athwart of the il- legal, extralegal or criminal activitics of the league interests he is branded politically inspired. For the league leaders ‘are above the Jaw. Banking laws were not madé for them but for other people. Sedition and espionage laws were not made for them but for others; It is as if an official of t St. Paul Association, caught violating the banking laws of.the state and ex posing the funds of.depositors or of the public to loss, should accuse the state officials of hostility’to the St. Paul Association, Banking laws are made for a pu pose, part of which, it may be sai EVERETT TRUE THAT PAIR OF SHOES We do not apply the same reason of value in the keeping of our Liberty bonds that we did in their purchase. A Liberty bond has a value of its market price the same as so much cash. More in fact; for it bears interest. All issues will doubtless go to a premium and they are easily converted into cash by their bearer. But few of us seem to apply the same imagina- tion to the care of a Liberty bond that all of us do to the same amount in cash. Why not apply the same care to the keeping of a 50-dollar government bond that we do to a dollar bill or the loose change in our pockets? One reason why the United States war labor board was a success was because it decided almost everything in favor of the workers, and the em- ployers were getting theirs and didn’t care. Wilson twits Lodge because the senator once ‘mity to the farmers’ cause prompted the Fargo expose. If Governor Frazier’s own bank ex- miners are telling the truth, the farmers’ col-|about peace without victory. declared in favor of a sort of league. Men change their minds: There was once a man who talked YO WHAT NORTHWEST PRESS THINKS OF 3] sor S| misjudgment, TACK ABOUT THE HIGH COST OF LIVING WHAT Do You SUPPOSE THEY SOAKED ME FOR SIXT ES Be oucand ig STYLISH SHOES WHAT ARE You 7 IDOING WITH A New SILK i SHIRT ON 211 OPPORTUNITY KNOCKS | smtseosseens ise emepsmenatesi en tsemetgnmstamnntoemet momma tt OH a IN TOWNLEY CAMP State Banking Board’s Action Not Shared in by Courier-News—League Organ Thinks Frazier/Statement: Will Make Farmers Feel. Better—Com- ment From Other Newspapers. is to protect the savings of depositors from the personal speculations of men put in-charge of large amounts of the public’s cash, and from the speculation of the friend or business or political allies of these men. The acceptance of what the North Dakota e banking’ board, terms inadequate collateral by the officials of the Scandinavian-Amer- ican bank of Fargo and the loaning of funds sS of any collateral what- soever Was in the nature of a speculi- tion, and if the executive officials’ of the state ‘liad nét put a stop to th sort of thing (as Governor Frazt | voted not to put a stop to) they would {have been guilty of betraying th ne s of the publie, of violating cl funds of a fi ly t them for him, His inten- be honest, but he may lose and thé trusted friend ean mplaint except of his own Put this is not a bank- ing relation «and state laws are not made to interfere with it. They are made to limit and prescribe the pr cedure of banking officials who acee:t deposits from the public, and the en- forcement of state laws in the.adminis- tration of North, Dakota banks can- not, with any plausibility whatever, he charged, to unoflicial or ulterior mot- on the part. of the officers of the and inv tions may the money haye no ¢ law. It is stated.in the report of. rih Dakota bank examiners regard- ing the Scandinavian-American bank the ate BY CONDO, | 2 USTEN:- U CANIT AFFORD EXTRA [of Fargo that loans were made in ex- jcess of the face value of collateral and that the collateral itself was “wholly inadequate.” It is stated that a loan consisting of .six notes aggregating $47,088, due last Aywril 1, was ordered out of the assets’ of the bank at that time, but has not as yet been either so removed or collected. The report fur- ther states that, notes of a sisal trust which has not yet passed the gauntlet collateral for a loan’ of, $12,000; that two officers .6f the’ bank gre. down excess’ borrowers for more.than, $1 000 each; that the unsecured person: of an employe of one of. Town- y’S publications are . accepted for loans of $2,000 and $3,300, ‘the latter of which is now past due, and, to cap the climax, that an employe of the Nonpartisan league had, — persona’ charge of the collateral of that institu- tion and its subsidaries, consisting of personal notes and post-dated checks, for which loans aggregating $432,956 ued. i y be political, animosity which netuat& an official banking board that ud, break up‘this sort of thing, But who ¢an say that such board would have heen true to its official obligations had it not so acted?, So many people may desire have a perfect right to turn their personal resources Over to Townley and his friends, But we imagine there are a great many North Dakotans who would like to know whether ‘they are depositing money in a bank under the protcetion of laws or whether they are entrusting it to unauthorized speculation, — St, Paul Dispatch. 5 FOR PROTECTION OF DEPOS- ITORS The closing of the Scandinavian-Am- erican bank at. Fargo by order of tne State Banking Board, and the State Bank Examiners, is another step to- wards requiring all banks of the state to pursue sound business methods for the protection of depositors. It makes no difference what management the bank may have, or what affiliations or favored line of associations, political, social or commercial. If it appears tc the proper and legally authorized oiti cials, in charge of such bank that the securities of the bank are of doubtful or Of little value, or that loans have been made far in excess of the cus- tomary safe amounts, adopted by all reputable and solvent banks, the wel- fare of the public*and the reputation of the banking business itself, deman‘ls that these offending banks be close: before disaster culminates in prosecu- of the blue sky board were accepted as) ® tions, losses and possibly criminal s2n- tence Too many wrecks of misman- aged banks in the state attest the truth ‘of this self evident proposition. The Fargo bank just closed by the state examiners, appears to have be- of clearing house for cer- and notes acquired hy. the organization known as the Nou- partisan League, ‘These securities were obtained and discounted for cash in large sums, It was no ordinary business which the Fargo bank was transacting. It also appears that among the transactions was the financ- ing of certain industrial schemes of those, who are reported to have become. adept in organizing stock companies, and securing farmer’s notes for origi- nal capital, and “in the transaction to haye made very substantial’ personal profits for “services rendered the farmer.” Post-dated checks: in -large amounts on banks where the owners of thé checks have no funds, are not usually regarded as safe bankable se curity for cash advanced by the bank, part of which at Ieast is the property of the depositor. R To say that the closing of the Fargo institution‘ is only a matter of political spitework, and that if time had beea given the directors and officials would have complied with good banking methods, is easy to say. But that is no explanation or excuse for the ap- parent disregard of sound bankins methods, revealed by the signed state- ments of official bank examiners of the state. Further revelations in this imppr- tant expose will no doubt be had and are due the people of the entire state. rebirted HEAD hae GAO tn tha Hex i omaha ing MONDAY, OCT. 6, 1919. } of their patrons and depositors, ‘This action of the bank examiners will no doubt have a salatary effect in causing more careful compliance with sound banking methods in other politically organized and politically managed banks of the state, if there are any such, in discounting promissory notes foy stock, for: new-banks, for newspu- pers of for mereantile stores—James- town Alert, ‘ TOWNLEY AND THE SCANDI- NAVIAN BANK, North Dakota seems to be furtunate in the composition of the state banking board just at this time. According’ to the press reports comihg out of Bis- marek from time to time the taxpayers evidently, owe much to Attorney Gen- eral Langer and Secretary of State Hall for the care they are exercising, as members of this important board, in safeguarding the people rfom wild cat schemea and unsafe banking, ‘The record in the case of the Scan- dinayian-American bank of Fargo, long recognized as the clearing house for Townley financial schemes ,shows that there surely is “something rotten in Denmark,” especially when, in the face of that record, the governor of the state, aS a member of the banking board, veftised to yote for the closing of this bank, thus compelling the infer- ence that he would rather protest Townley) than the people of the state. The report on this Fargo bank is ap- palling in its details of loose banking and general control by( interests other than the stockholders, and bears out the warning of the banking board & week ago against farmers and others putting their money into banks 2on- trolled in one way or another by intez- ests inimicable to those of the stock- holders, and the fact that Townley’s Consumers’ Stores company has with- drawn from the bank over a quarter million dollars worth of collateral de- posited to secure loans, is without a paralell in the history of banking aad shows the use to which his chain banks ard being put by this Get Rich Qulei Wallingford. The further we proceed on our way in a Townley-controlled state, the more evident ‘it- ds that if Townley also owned all of the state officers such rot- ten bank looting as that brought light at Fargo whould be covered up by his submissive officials and the state and people soon brought to the same financial condition in which Townley found himself at the end of his Golden Valley career. . Yet there are many men of ordina- rily sound sense in this county who il believe “the king can do no wrong.”—The Beach Advance. FRAZIER ON THE JOB Farmers of North Dakota did not need Lynn J. Frazier’s public declarn- tion that he is “heartily opposed to these high-handed methods” of, Lau- r’s and Hall’s, and the big. business aggregation that is urging them on, and that he will do his “best to put a stop to them.” ) Nevertheless, it is mighty reassurinz to have the governor’s statement, It is the guarantee that the traitors who have now turned bank wreckers, aud who for the moment, seem to have things their own way, will be brought Up soon with a short ropes (9: Lynn.J. Frazier is not swift to wrath. His judgements are ‘formed slowly, And when they are formed they are irrevocable. ‘The time ius nov yet: come, in this or in any other state, when two renegade politicians can override the chief .executive and the courts and the laws, even though they have behind them all the yast financial power of big business, “I will do everything in my power,” says the governor, “to see that justice is done.” And knowing what the gov- ernor’s power is, and realizing tne value of his deliberate promise, farm- ers may well wait in confidence tne outcome of this latest fight against them by big business, * oe For in its essence the fight is against the farmers. Governor Frazier's state ment is of value also because it em- phasizes this fact. The closing of the Scandinavian-American, the arrest of President Hagen and Cashier Sher- man, the effrontery of the order se ing at one blow to destroy post-dated checks as security, though banks of the state have loaned on them without the loss of a single cent for years -- all this indicates that the whole attacl: is a vast conspiracy on the part of big business. Big business has sudden- ly awakened to a realization of what farmers’ paper can do, when it is mobilized and used by and for the farmers.-’ And so big business has thrown all its yast resources into th? wrecking. They count on the vast financial power at their command to override ‘any such trifles as law and justice, Langér brings in hig resolu- tions accusing former Bank Examiner Waters of tipping off to the Scandi- navian-American bank the date of the yarious bank calls, and when it is ex- plained to him that it is impossible for any man to tip off these calls, Langer merely erases a few words in the re- solutions and accuses Waters of tip- ping off the coming of the state exami- ner to Fargo. Any excuse will do, And so with Mr. Hagen, who has been in business in North Dakota for 27 years, without losing a cent to his customers, He must be arrested, to bolster,up Langer's case, and any ex- ouse Will do, Mr. Hagen is only a farmer banker, and Langer has taken upon himself the task of driving all farmers from business, + * But there need be no fe part of the farmers. ‘The farnee ce ment has not gone this far, to \be smashed by any such vain’ egoist as Langer. , Big business made no mistake in. choositig him in: one respect; he will, now that he seems to have reached a perfect understanding with big business, stop at nothing to follow out its commands. But he is a natural born fool—as the ‘Waters incident yes- terday proved—and fools are not ex- actly the persons to tackle such a job as that of Smashing the farmers’ moye- ment in North Dakota. On half a hundred -counts Langer has laid him- Self Hable, and already the noose is tightening around. his‘ official neck. It’s an old saying that, given enough rope, a fool will hang himself, 1 inger has had plenty. of rope. The ineyitable result is about to follow.—Courier- News (Nonpartisan borrower frum Scandinavian-American bank), Dance at Armory uae Hen and Sat- urday wHstit, 0"