Top Tax Rate Raised To 79%
Germany becomes the second nation to recover fully from the Great Depression, through heavy deficit spending on war materials and preparations for war.
The top tax rate is raised to 79%. Unemployment falls to 16.9%.
On April 27, hearings were held by the House Committee on Banking and Currency. The preamble of the bill - HR 9216 of the Seventy-fourth Congress, states;
"The committee had under consideration the bill (HR 92163 to restore to Congress its constitutional power to issue money and regulate the value thereof; to provide monetary income to the people of the United States at a fixed and equitable purchasing power of the dollar, ample at all times to enable the people to buy wanted goods and services at full capacity of the industries and commercial facilities of the United States; to abolish the practice of creating bank deposits by private groups upon fractional reserves, and for other purposes." The Congress declared, "Whereas the permanent welfare of the people and the protection of the economic life of the Nation are dependent on the establishment of a monetary system wholly subject to the control of Congress that will promote the interests of agriculture and labor, of industry, trade, commerce, and finance for the economic well being of all citizens by the maintenance of an adequate supply of money with a unit of fixed average purchasing power, which will avoid excessive expansion or disastrous contraction."
"By this bill, Congress resumes its constitutional duty of issuing money and regulating its value, a duty and a right which it has long been abdicated to the private banking system,"
That preamble led to the body of the text.
"Section 1. That it is hereby declared to be the policy of Congress to provide such issuance's of certificates of national credit as shall be requisite so to increase the purchasing power of the consumers of the United States as to make it conform to the capacity of the industries and people of the United States for the production and delivery of wanted goods and services, which capacity be declared to be the measure of national credit."
Congress attempted to issue non-interest bearing Treasury Notes. Congress wanted to establish a Federal Credit Commission linked to the Secretary of the Treasury.
The Commission was to consist of seven commissioners appointed by the President with approval of the U.S. Senate. U.S. citizenship was a prime requirement and they could not have more than four from one political party. It was also made unlawful for anyone to interfere with the commission.
The concern of Congress was that banks were issuing loans without the backing of real deposits and that it was controlling money based on the price it attracted on international money markets or by the amount of interest they could charge. The Congress wanted to withdraw from the banks the right to issue credit on fractional reserves, and leave the banks the right to issue credit on account of actual deposits, which means that permanent money will be loaned not bank manufactured money.
Congressman Louis T. McFaddens's suffered "heart-failure sudden-death" on Oct. 3, after a "dose" of "intestinal flu". - "Pelley's Weekly" of Oct. 14, 1936
Rep. Louis T. McFadden, was the Chairman of the House Banking and Currency Committee throughout the 1920-30s.
It is reported that Congressman McFadden had already seen two attempts on his life. The first came in the form of two revolver shots fired at him from ambush as he was alighting from a cab in front of one of the Capital hotels. Both shots missed him, the bullets burying themselves in the cab.
The second attempt as reported by Robert Edward Edmonsdson: "He became violently ill after partaking of food at a political banquet at Washington. His life was only saved from what was subsequently announced as a poisoning by the presence of a physician friend at the banquet, who at once procured a stomach pump and subjected the Congressman to emergency treatment."
The Tripartite Agreement (France, United Kingdom and the United States) whose goal is to avoid competitive exchange depreciation's takes effect.