Congressman McFadden, Congressional Record: January 8, 1934:
“The Congress of the United States must immediately throw the searchlight of investigation into this dark corner, or we are going to be swamped with political influences that are manufactured in foreign countries and that will lead us to the surrender of our heritage of living, just as has been done on former occasions.
Just as we did, for example, when we entered into the Jay Treaty with England, which was ratified on June 24, 1795, whereby we needlessly surrendered our right to the freedom of the seas.
We fought the
" >War of 1812 to regain this right, but the same political influences prevented even a discussion of this subject at the treaty which terminated that war. President Wilson vowed to regain the freedom of the seas at the Treaty of Versailles
; but did we regain it? Is the Jay Treaty still in force?….”
“I stand here and say to you that I have studied these records, and not only did we adopt this monetary policy without debate, not only did we adopt it without consideration but we adopted it without even knowledge of what we were doing!
It was a piece of legislative trickery; it was a piece of work in the committee that was silent and secretive. Even members of the committee did not know what was being done, according to their own declarations. The President and Members of the House did not know they were acting on such a measure. But, as I have said before, the shadow of the hand of England rests over this enactment.” (C R, January 8, 1934)
Congressman Fiesinger: “You will recall the gentleman spoke about Professor Sprague, who was in the Treasury Department as adviser to the Treasury after he came as adviser for the Bank of England. He was also monetary adviser to the Economic Conference in London.”
Congressman Fiesinger: “I was just going to remark that very thing, that the power to “coin and fix the value of money” is solely within the power of the Congress of the United States and it cannot be delegated to anybody else in the world.”
Congressman McFadden: “Will the gentleman yield further?”
Congressman Fiesinger: ” I do.”
Congressman McFadden: “What does the gentleman say in regard to the delegation of that power to the Federal Reserve System?”
Congressman Fiesinger: “I say it is illegal. I say it is unconstitutional, as far as it affects the value of basic money. Power to control credits may be in a different class.”
Congressman McFadden: “The gentleman recognizes that that was done, does he not?”
Congressman Fiesinger: “Well, I think I recognize that fact; but it may be that Congress intended to delegate banking and credit control and not the control of the basic money values.”
Congressman McFadden: “The Federal Reserve System has the power to issue Federal Reserve notes, which circulate as money?”
Congressman Fiesinger: “It has. Of course, they are promises to pay. They are credits or IOU’s of the bank.”
Congressman McFadden: “And that power was delegated by Congress in the Federal Reserve Act.”
Congressman Fiesinger: “Yes, sir; with the intent to regulate the volume of credit.”
Congressman McFadden: “And is being pursued by them, which gives the Federal Reserve System control over the money and credit in the United States.”….
Congressman Mott: “What does the gentleman say about the delegation by Congress to the President to fix the value of money, under the farm bill?”
Congressman Fiesinger: “I think it was illegal, and the President did not want it. It was forced upon him. He never asked to have the amendment attached to the farm bill. It was forced upon him, and he is exercising the power because he was forced to exercise it; a power that he never wanted, and I say it is all illegal and unconstitutional.”
Congressman McFadden: “If the gentleman has been familiar with the activities of Dr. Sprague over the history of the Federal Reserve System, he well knows that Dr. Sprague has been in all of the conferences, practically, between the Bank of England, officers of the Federal Reserve bank in New York and other central banks, which have had for their purpose the dealing with national and international price levels. That was one of the functions that he was exercising as expert adviser of the Bank of England.”
Congressman Fiesinger: ” Now, I understand that Dr. Sprague at the London conference was willing to peg the dollar to the British pound at $3.50, and, if he had done that, the price levels in America would have been in the control of the Bank of England, and it would have been so low it would have wrecked our national economy.”
Congressman Lamneck: “Will the gentleman please insert at this point what Dr. Sprague said about who should control the price level?”
Congressman Fiesinger: “I may say-I did not expect to answer that question, but Dr. Sprague, in a conference he had, stated he believed that the value of gold should be controlled by the British, because they were more competent, from banking experience, so to do.” (CR,1-8-1934)