Henry Ford

“ That this System was useful in the artificial conditions created by war—useful, that is, for a Government that cannot manage its own business and finances and, like a prodigal son, is always wanting money, and wanting it when it wants it—it has proved, either by reason of its inherent faults or by mishandling, its inadequacy to the problems of peace. ”

“ Warburg is of the opinion that different rates of interest ought to obtain in different parts of the country. That they have always obtained in different parts of the same state we have always known, but the reason for it has not been discovered. The city grocer can get money from his bank at a lower rate than the farmer in the next county can get it from his bank. Why the agricultural rate of interest has been higher than any other (when money is obtainable; it is not obtainable now) is a question to which no literary nor oratorical financier has ever publicly addressed himself. ”

“ Natural conditions are always easiest to explain. Unnatural conditions wear an air of mystery. Here is the United States, the richest country in the world, containing at the present hour the greatest bulk of wealth to be found anywhere on earth—real, ready, available, usable wealth ”

“ Warburg, having educated the bankers, will now turn his attention to the people, and make it clear why one class in the country can get money for business that is not productive of real wealth, while another class engaged in the production of real wealth is treated as outside the interest of banking altogether ”

“ Warburg is not at all shocked by the idea that the Federal Reserve System is really a new kind of private banking control, because in his European experience he saw that all the central banks were private affairs. ”

“ Warburg, referring to the United States, “with every untrained amateur a candidate for any office, where friendship or help in a presidential campaign, financial or political, has always given a claim for political preferment, where the bids for votes and public favor are ever present in the politician’s mind, . . . . a direct government management, that is to say, a political management, would prove fatal . ”

“ These, he says, are not fitted to take part in the control of monetary affairs. But Mr. Warburg is. He says so. He admits that it was his ambition from the moment he came here an alien Jewish-German banker, to change our financial affairs more to his liking. More than that, he has succeeded; he has succeeded, he himself says, more than most men do in a lifetime; he has succeeded, Professor Seligman says, to such an extent that throughout history the name of Paul M Warburg and that of the Federal Reserve System shall be united. ”

“ Observe the phrases:
(a) “without giving the government any part in the management or control.” (b) “these central banks, while legally private corporations . . . . are permitted to issue the notes of the nation.” (c) “they are custodians of practically the entire metallic reserves of the nation and the keepers of the government funds.” (d) “in questions of national policy, the government must rely on the willing and loyal co-operation of these central organs.” It is not now a question whether these things are right or wrong ”

“ It has sadly failed of its promise, and is now under serious question.
Mr. Warburg’s scheme succeeded just in time to take care of war conditions, he was placed on the Federal Reserve Board in order to manage his system in practice, and though he was full of ideas then as to how banking could be assisted, he is disappointingly silent now as to how the people can be relieved. ”

“ It is permissible to doubt that all that Colonel House confessed was his ignorance about “those fellows.” There was a good understanding between these two men, too good an understanding for the alleged telephone conversation to be taken strictly at its face value. ”