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The moral question involved is this: Should the Government make a profit on handling the product of an American producer? Would it be just for the Government to buy wheat at 67 cents a bushel and sell it to the American consumer at $1.37 a bushel? Would it be fair for the Government to buy sugar from the American producer and then sell it to the American-consumer at twice the price? Such a thing is incomprehensible, and yet that is what the Government is now doing and has for years been doing with silver. It has for years carried an account of its profits in dealing with silver which have amounted into the millions.

What the Government should do with regard to subsidiary coinage is to pay the producer the same price at which it sells the silver to banks and to commerce and trade. We are not even asking that at the present time. We are asking that you stand by your sale to the Director of the Mint. We ask you to carry out the spirit of the act and encourage the silver production of the country. We ask you to recognize that if you had any equity with regard to the revocation of the allocation of the 10,000,000 silver dollars that you slept on your rights during a period of three years. We ask you only to make a profit of 37 cents on the silver that you buy from the American producer and which you sell to the banker and to commerce and to trade.

The American people do not want you to make this exorbitant profit on an essential industry of this country. They will be satisfied with the profit that you make by paying $1 an ounce. They are willing to forego the additional profit of $5,000,000 so as to help sustain an industry that is tottering by reason of the oppression and neglect that it has suffered at the hands of its own Government.

You seem to desire to construe the act so that the Government may have won either way. As long as silver was above a dollar an ounce it was a sale even for a period of three years, and when silver goes down below a dollar an ounce it is not a sale. No such position could be maintained by an individual under the law. Why should such practices be attempted by departments of the Government?

You are authoritatively informed by the representatives of silver producers that many little producers of silver will be absolutely destroyed by the premature termination of the purchase of silver by the Government under the Pittman Act.

When did this administration hesitate to tax the American people to support and protect industries? The silver miner pays from 15 to 70 per cent increased price for nearly everything that he uses by virtue of the tariff passed by this administration avowedly to protect and sustain the industries of the country. In fact, the silver industry is one of the few industries that has never had tariff protection or any other form of protection except the Pittman Act.

Does this administration and the Treasury Department consider the silver industry of no value to the United States? Our country produces over onethird of the silver of the world. It is essential as an exchange medium in trade with China and India, two of the greatest silver-using countries in the world. The price and control of our own silver is in the hands of the Bank of England, through the price fixing of four brokers in London who are acting by authority of the Bank of England. The Pittman Act itself recognized the necessity for the use of some silver dollars in the Treasury in settling our trade balances in such countries as China and India. It provided for the use of silver dollars for such purposes. At the time that this Government had an embargo upon the exportation of silver it was necessary to pass a special act of Congress so that American silver could be exported to China to take care of our exchange and our commerce with that country.

If this Government has any interest in the production of silver, then it should consider how it has treated the industry in the past and what it may do for it in the future. The world's price of silver to-day is approximately what it was before the war. The prices of practically all other products in the United States and throughout the world are from 30 to 60 per cent above what they were before the war. The cost of production of silver has increased enormously, as has the cost of production of all other products. Our Government has made every effort to support all other industries in this abnormal condition, but has done nothing for silver and nothing for the gold-mining industry.

The rescinding of the orders of revocation by the Treasury Department will continue the purchase of silver at $1 an ounce for two or three months longer,

and while this is but small assistance, it will give the mine operators an opportunity to arrange their business and probably prevent many failures that otherwise must occur.

The Treasury Department probably figures the actual number of men engaged in mining silver. They forget that whole communities are dependent upon the continuance of such mining operations. They forget that to every one miner there are from five to ten people who are equally dependent upon the continuance of this industry.

The opinion of the Comptroller General, upon which the Treasury Department depends, expressly states. that the matter of revocation or nonrevocation is entirely within the discretion of the Treasury Department.

I respectfully again urge the Treasury Department to reconsider the attitude that it has maintained and utilize the power that it undoubtedly has under the Pittman Act to prevent the sudden and unexpected termination of the purchase of silver at $1 an ounce.

Respectfully submitted.

KEY PITTMAN,

Vice Chairman, Senate Commission of Gold and Silver Inquiry.

WASHINGTON GOVERNMENT PRINTING OFFICE: 1928

SILVER PURCHASES UNDER THE PITTMAN ACT

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE

COMMISSION OF GOLD AND SILVER INQUIRY
UNITED STATES SENATE

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Printed for the use of the Senate Commission of Gold and Silver Inquiry

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COMMISSION OF GOLD AND SILVER INQUIRY.

TASKER L. ODDIE, Nevada, Chairman.
KEY PITTMAN, Nevada, Vice Chairman.

THOMAS STERLING, South Dakota.
FRANK R. GOODING, Idaho.

THOMAS J. WALSH, Montana.

H. N. LAWRIE, Assistant to Commission.
C. E. ALDEN, Secretary.

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