the mere operation of manufacturing, whatever it may do with the product of that manufacture. Mr. DE ARMOND. Mr. Chairman, I think the gentleman from Ohio hardly gives sufficient weight to a part of this provision sought to be stricken out. I take it that this provision is in for a purpose, that the words are put into it for office, that they are not merely idle and incidental. Here is what is said in section 6, among other things: It shall be the province and duty of said Bureau, under the direction of the Secretary, to exercise such control as may be provided by law over every insurance company, society, or association transacting business in the United States outside of the State, Territory, or District wherein the same is organized. The gentleman makes the point that this does not contain the legislation for carrying into full effect that provision. But it contains the provision, it provides for a bureau to exercise this function, to have control and to adopt rules and regulations for every insurance company or association, life, fire, marine, or of whatever kind, doing business outside of the State or Territory of its organization. Now, every State in this Union, I presume-certainly nearly all of them-have laws regulating the operation, fixing the resposibilities, protecting the patrons of insurance companies organized beyond their borders and doing business within the several States. That power-however w'.olesome, constitutional, well organized, exercised with judgment, satisfactory to the people for the protection of patrons-is to be minimized, if not swept away, so far as it may be in the power of Congress to do it, by creating a Bureau organized and authorized to provide means and make rules and regulations and to control and direct the operations of these various companies whenever they carry on business outside of the immediate jurisdiction which created them. What is to become of the State laws in that case? Are the State laws, when in conflict with the regulations and rules prescribed by this Bureau, to control, or are they to give way? Is there to be a conflict to be settled by the courts? Evidently and clearly the proposition of the framers of this provision is to give to this Bureau, a Bureau of this new Department, the control of the vast and complex insurance business of the whole United States. Because it is a fact that a large per cent of all the companies not only exist and do business within the States and Territories or districts in which they are incorporated, but in other States and Territories and districts. Here is the provision intended to place all of them under the control, subject to the jurisdiction of a Bureau in this new Department of Commerce. It is idle to say that legislation is not lacking to enable the chief of this Bureau to accomplish all that in the creation of the Bureau it is designed shall be accomplished. If there is reason to provide this Bureau with authority and power and scope and purpose in it to exercise these functions, then there is reason also for following with legislation furnishing the necessary machinery to do it. How idle it is to talk about creating this Bureau of supervision and control of the insurance business of the country and say that you have no purpose to legislate further to carry this out. The purpose, clear and distinct, is to follow this with legislation which shall subject the entire insurance business of the United States to the dominion of a bureau chief in the city of Washington. [Applause.] [Here the hammer fell.] Mr. HEPBURN. I move that all debate on the amendment and the section close in ten minutes. The motion was agreed to. Mr. GARDNER, of New Jersey. Mr. Chairman, the gentleman from Missouri [Mr. De Armond] is right when he assumes that this legislation is not proposed to be passed, and the foundation distinctly here laid for future legislation, without the expectation of making this a Bureau in Washington to control the insurance business of the United States. That is its object. Neither the gentleman from Ohio nor other gentlemen ought to be permitted to mislead this House by making disclaimers and talking of limitations of power, about which I much fear my distinguished friend from Michigan [Mr. Corliss] is mistaken. Will the members of this House look at that bill and tell me what reason can be discovered for not incorporating this Bureau in the Bureau of Corporations, except the object be, as shown on its face, to give the Washington Bureau more extreme power over insurance corporations than you propose to give any bureau over any other corporation in the United States-trust or not. The declaration of the bill is specific that this Bureau is to exercise such control as may be provided by law. What will be the natural source of law on this subject? The distinguished gentleman from Ohio is a sincere, earnest, and aggressive man. He has made it known to this House that he believes the insurance business of the United States ought to be controlled by a Washington bureau, and that much of it 616 can constitutionally be so controlled. He has put his belief in form in this proposed legislation. He presides over the committee from which such legislation would naturally come here. Why, sir, here is an able, distinguished, and truthful source of such legislation suggested, and here, in all probability, it will remain a potent factorin the Committee on Interstate Commerce-until that unhappy day for mortals when he takes his seat amid the everlasting glories of the cherubim. [Laughter.] Why, Mr. Chairman, of what are gentlemen dreaming if they do not believe that is the object of this provision? The distinguished gentleman from Ohio, in citing instances in which the proposed bureau might be useful, has referred to conditions which might arise in which this Bureau would have jurisdiction, not alone in Ohio, Pennsylvania, New Jersey, but in the Empire of Germany and Austria. That is where the difficulty he instanced was located, and it was the only instance cited in which such a bureau might have been utilized. The question presented to this House by the proposed legislation is whether you will here lay the foundation, build the machinery, with a power behind it to accomplish the ultimate purpose, to take absolute national control of the insurance business, to supersede and destroy the insurance department of every State. As I said this morning, I know that the belief and the hope is, with this bill as a foundation, to escape State regulation, and that this whole question, the opinion of the gentleman from Michigan to the contrary notwithstanding, can be beaten into such shape as to be clearly matter of interstate commerce. Look at the peculiar language of this bill. the section that creates a Bureau of Corporations the corporations are specifically limited to doing the things recited by the gentleman from Ohio-collecting statistics and disseminating useful information; not one word of power, or the suggestion of power, except, perhaps, the last line— "and such other duties as may hereafter be prescribed by W." The CHAIRMAN. The time of the gentleman has expired. Mr. Hepburn rose. ized. New Jersey Mr. GARDNER, of New Jersey. I would like to have one minute more. The CHAIRMAN. The gentleman from Iowa [Mr. Hepburn] is recogn. Mr. HEPBURN. Mr. Chairman, in my judgment, if the gentleman from > [Mr. Gardner] had more of courage and more of hope he would not be so rimorous with regard to this bill. He has not been able to discover how harm could possibly result to any individual under the present proposed legislation. His only claim and the only contention that he makes is that in some later day, by usurpation, by unjust legislation, Congress may indulge in an enactment that may harm the State interest and State control over insurance companies. Mr. Chairman, is not this the trouble: The gentleman is afraid of a control that will bring publicity into the doings of those vile and infamous corporations that are created so lavishly by his State, and from which his State derives an annual revenue of millions of dollars? [Applause.] I do not blame him for looking out for the moneyed interests of his State, while it is creating these bogus corporations to operate and prey upon the people of the other States. Mr. GARDNER, of New Jersey. That is an absolute misstatement, and it has no application to this question. We have not organized an insurance company there. Mr. HEPBURN. Oh, well, I did not say "insurance company," I said "company." Mr. GARDNER of New Jersey. Then the expression had no application; and it is not true. Mr. HEPBURN. Do not interrupt me, if you please. Mr. GARDNER, of New Jersey. I will not; but if you state as fact what is not so, I I must correct you. Mr. HEPBURN. I want to say that these fears of my friend from New Jersey are entirely groundless. What are the limitations of this bill? What can be done under it? It shall be the province and duty of said Bureau, under the direction of the Secretary, to exercise such control as may be provided by law over every insurance company, society, or association transacting business in the United States outside of the State, Territory, or district wherein the same is organized. Mr. GARDNER, of New Jersey. May I ask the gentleman a question? Mr. HEPBURN. No, sir. The only control is that which is authorized by law, by the law of Congress, by what this House at some future time may do. Now, then, let me go a little further-"to foster, promote, and develop the various insurance industries of the United States." How? How? By exempting them from taxation? No! By interfering with the powers of the States? No! But how? Simply by gathering information as to how they are conducting their business, as to what is their solvency, what right they have to appeal to the confidence of the people and to publish it to the world. That is the limitation. That is all that they can do under this statute, and any statement to the contrary is to mislead, to humbug somebody, to aid the gentleman to protect and foster the peculiar methods that his State has of paying its expenses by turning loose a flood of cormorants to prey upon the balance of mankind. [Applause.] Mr. Chairman, I ask for a vote. Mr. SHACKLEFORD. Mr. Chairman, may I ask a question of the gentleman before he takes his seat? Mr. HEPBURN. I call for a vote. The CHAIRMAN. The question is on the amendment offered by the gentleman from Michigan. Mr. THAYER. Mr. Chairman, what is the amendment? The CHAIRMAN. Without objection, the Clerk will again report the amendment. There was no objection. The Clerk read as follows: Strike out all of section 6. The CHAIRMAN. The question is on the amendment. The question was taken; and on a division (demanded by several members) there were-ayes 88, noes 78. Mr. HEPBURN. Mr. Chairman, I demand tellers. Tellers were ordered. The committee again divided; and the tellers reported-ayes 98, noes 81. The Clerk read as follows: SEC. 8. That the jurisdiction, supervision, and control now possessed and exercised by the Department of the Treasury over the fur-seal, salmon, and other fisheries in Alaska, as well as over Chinese immigration, including the authority conferred by the various acts in relation to the exclusion of Chinese upon collectors of customs, be, and the same hereby are, transferred to and vested in the Department of Commerce and Labor; and the Secretary of Commerce and Labor shall designate officials of his Department to perform the duties and exercise the authority now conferred upon collectors of customs or other officials of the Treasury Department (who are not hereby transferred to the Department of Commerce and Labor) in regard to Chinese exclusion and immigration. Mr. MANN. Mr. Chairman, I offer the following amendment, which I will send to the desk and ask to have read. The Clerk read as follows: Amend by striking out all of section 8 and inserting in place thereof the following: "SEC. 8. That the jurisdiction, supervision, and control now possessed and exercised by the Department of the Treasury over the fur-seal, salmon, and other fisheries of Alaska, and over the immigration of aliens into the United States, its waters, territories, and any place subject to the jurisdiction thereof, are hereby transferred and vested in the Department of Commerce and Labor. That the authority, power, and jurisdiction now possessed and exercised by the Secretary of the Treasury by virtue of any law in relation to the exclusion from and the residence within the United States, its territories, and the District of Columbia, of Chinese and persons of Chinese descent, are hereby transferred to and conferred upon the Secretary of Commerce and Labor, and the authority, power, and jurisdiction in relation thereto now vested by law or treaty in the collectors of customs and the collectors of internal revenue are hereby conferred upon and vested in such officers under the control of the Commissioner-General of Immigration as the Secretary of Commerce and Labor may designate therefor." The CHAIRMAN. The question is on the amendment offered by the gentleman from Illinois. Mr. DE ARMOND. Mr. Chairman The CHAIRMAN. The Chair has recognized the gentleman from Illinois. Mr. MANN. Mr. Chairman, I am perfectly willing to yield to the gentleman from Missouri. I may say however, that this is an amendment which was originally prepared by the entleman from California [Mr. Coombs] in connection with the Commissioner-General of Immigration, and it simply safeguards the provisions in reference to the exclusion of Chinese, so that the proper transfer of authority from the Treasury Department to the proposed Department of Commerce is made and protected. There is no other purpose in making the amendment. Mr. LACEY. Mr. Chairman, I would ask the gentleman if this proposed amendment changes the effect in any way of the law in relation to the fur-seal fisheries? Mr. MANN. It does not. The CHAIRMAN. The gentleman from Missouri [Mr. De Armond] will now be recognized, if he desires to speak. The question now is on the amendment offered by the gentleman from Illinois. The amendment was agreed to. Mr. STEWART, of New Jersey. Mr. Chairman, I ask unanimous consent to return to section 7 in order to supply an evident omission. The CHAIRMAN. The gentleman from New Jersey asks unanimous consent to return to section 7 of the bill. Is there objection? Mr. MANN. For what purpose? Mr. STEWART, of New Jersey. For the purpose of offering an amendment. Mr. STEWART, of New Jersey. The appointing power is not inserted. It is an evident omission. The words "who shall be appointed by the President" should be inserted. Mr. MANN. Mr. Chairman, there should be a provision in the section providing that he shall be appointed by the President. I have no objection to returning to the section for that purpose. Is The CHAIRMAN. The gentleman from New Jersey asks unanimous consent to return to section 7 for the purpose of submitting the amendment he has referred to. there objection? There was no objection. Mr. MANN. Mr. Chairman, I have the amendment already prepared. Let it be offered as coming from the gentleman from New Jersey. The CHAIRMAN. The gentleman from New Jersey offers the amendment which the Clerk will report. The Clerk read as follows: Insert in line 20, page 13, after the word "bureau," the following: "shall be appointed by the President and," The CHAIRMAN. The question is on agreeing to the amendment. The amendment was agreed to. The Clerk read as follows: SEC. 9. That the Secretary of Commerce and Labor shall annually, at the close of each fiscal year, make a report in writing to Congress, giving an account of all moneys received and dispersed by him and his Department and describing the work done by the Department in fostering, promoting, and developing the foreign and domestic commerce, the mining, manufacturing, shipping, and fishery industries, the transportation facilities, and insurance business of the United States, and making such recommendations as he shall deem necessary for the effective performance of the duties and purposes of the Department. He shall also from time to time make such special investigations and reports as he may be required to do by the President, or by either House of Congress, or which he himself may deem necessary and urgent. Mr. DE ARMOND. I move to strike out, in line 2, page 15, the words "and insurance business." The Clerk read as follows: Page 15, line 2, after the word "facilities," strike out the words “and insurance business.” Mr. MANN. We are perfectly willing to have that amendment adopted. The amendment was agreed to. Mr. MANN. I move to amend, by inserting in line 1 of the same page, before the word "the," the word "and." The amendment was agreed to. Mr. MANN. Mr. Chairman, the same amendment ought to be inserted in section 3. The CHAIRMAN. The gentleman from Illinois asks unanimous consent to return to section 3 for the purpose of offering the amendment which he has stated. Is there objection? There was no objection. The Clerk read as follows: Page 9, line 22, after the word "interests" and before the word "the," insert "and.” The amendment was agreed to. Mr. GAINES, of Tennessee. Mr. Chairman, I desire to er an amendment to the bill in the nature of a new section. The CHAIRMAN. The gentleman from Tennessee offers an amendme Clerk will report. The Clerk read as follows: which the That said Department shall investigate and report to the Postmaster-General of the United States the name of any corporation, company, person, or persons who are carrying on the business of insurance and have failed to comply with all the laws of the State or States or Territories where such business is carried on, including the State or Territory creating such corporation or licensing such companies, person, or persons, and upon the filing of such information with the Postmaster-General of the United States he is authorized and directed to exclude such corporation, company, person, or persons from the use of the mails in carrying on its or his insurance business, under penalty of $5,000 and imprisonment for each offense, in the discretion of the court. Mr. GAINES, of Tennessee. Mr. Chairman, I am just as anxious to curb "wild-cat insurance" as the gentleman who reported this bill, or the gentleman from Iowa [Mr. Hepburn]. The gentleman knows that I objected to that section in the bill because "insurance is not commerce." The highest court in the land, the Supreme Court of the United States, said so in the Hooper case (155 U. S. Reports), which I cited in my speech on this subject two days ago. Now, I invoke another power that knows no State lines, and that is the post-office power of the Federal Government. There are no State lines or powers involved in that exclusive grant of power. All there is in the Constitution on this power is "that the Congress shall have the power to establish post-offices and post-roads." From this flows our mail service. We have excluded from the use of the mails all obscene literature, etc., whether in letters or papers, and many other things in derogation of public morals and good society. This we all know, and the courts uphold such laws. We excluded the Louisiana lottery from the mails and drove it out of the United States. Now, my amendment is simply a new section, which says in substance that when the Department of Commerce shall investigate to find, and if it does find, that any person, insurance company, or corporation has failed to comply with the laws of the State or Territory authorizing them to operate, or the laws of the State or Territory in which they are operating, then this fact is to be reported to the PostmasterGeneral of the United States, who by this amendment is authorized and directed to exclude such concerns or persons from the use of the mail. This measure strikes at all lawless insurance concerns, but especially those who have no agents, but procure insurance through the mail. They often do this: First. They get out a charter, a charter only in one State-say New Jersey. They do nothing more. They fail to comply with the "operating" laws of New Jersey. They say: "We are not going to operate in New Jersey." Second. They then go to Chicago, say, and get an office and possibly a license. They do not want to insure in Illinois, so they do not comply with the operating laws of Illinois, hurt no one in Illinois, so the State authorities let them off with or without a license. Third. They then from Chicago, by mail and not by agents, get insurance in Tennessee. The ignorant are their victims. They insure this class, and others, too, sometimes, I know. A loss occurs. Premiums paid through the mail. The insurer is, and was from the start, bankrupt and robber, and nothing can be collected even if the insurer can be found. Thus using the mails, the State insurance commissioner does not know of the insurer until too late. Why? Because the whole transaction has been done through the mails, over which he has no control. The operators are unseen. The loss occurs because the insurer stealthily avoids complying with all State laws of New Jersey, Illinois, and Tennessee. This Department can by vigilant action discover such an insurer and report the facts to the Postmaster-General of the United States, and then he will exclude the guilty party from the use of the mail. The recent insurance commissioners' convention approve of such a law as here proposed, and passed resolutions to that effect, calling on Congress to act. I may add, further, that the treasurer of the State of Tennessee, Mr. R. E. Folk, who is a distinguished brother of our distinguished prosecuting attorney in St. Louis, Hon. Joseph Folk, late of Tennessee, I may add, urges the passage of such a measure. He explained this evil to me last summer and recently. I have incorporated in this amendment the judgment of that great insurance body, Mr. Folk's as well as my own. I have shown to you that the law is with us, the Constitution of the United States is with us, precedents are with us, and we can exclude from the mails such corporations and these people who rob the humble citizens of this country, who know nothing of the lawlessness of the monsters they are dealing with or their irresponsibility. Mr. LIVINGSTON. May I ask the gentleman a question? Mr. GAINES, of Tennessee. Yes. Mr. LIVINGSTON. As you have excluded all jurisdiction over insurance from the bill, how can the Department of Commerce ascertain anything about it? Mr. GAINES, of Tennessee. I will say to my friend I did that because the Supreme Court of the United States held that “insurance is not commerce;" hence we had no jurisdiction under the commerce clause; but here I invoke another power of Congress-the right to "establish post-offices and post-roads"-that is under the exclusive control of Congress; and if this Department says that these wild-cat insurance companies or persons are carrying on a business unlawfully to the detriment of the public they shall not use the mails. Mr. LIVINGSTON. But you have excluded from the Bureau that jurisdiction. Mr. GAINES, of Tennessee. Oh, no; I am giving jurisdiction by a new section of the bill, by which authority is given to the Bureau to investigate and find out whether any one of the parties named is conducting a wild-cat insurance business or not, and if so, the Postmaster-General shall say: "You shall not use our mails to rob the people of this country." Mr. SHACKLEFORD. Mr. Chairman, I have never heard a stronger or a sounder argument made against any question than that made here to-day about this insurance clause on this bill. The amendment offered by the gentleman from Tennessee |