This is an extract from a letter, which has just been handed to me, from the Minister for Defence, Mr. Desmond Fitzgerald, written from New York and dated October 14, 1929. It says:—
"The other matter which one comes across constantly here is repayment of the bonds."
Here is a Minister, a member of the Executive Council, over in New York at the time and transmitting information to his colleagues here. He continues:—
"I have informed everybody I met that it is quite definitely the intention of the Government to accept full responsibility for the repayment of the bonds, and I explained that, to the best of my knowledge, the reason for the delay in doing so was the law action and necessity to have full information of distribution of the funds here to the bondholders. I have said that when that distribution has taken place, and we know exactly what percentage each individual subscriber has received back from the bondholders' trust through the bondholders' trustees, the Government would proceed to pay whatever the difference might be between the sum received by these bondholders and the amount subscribed by them, plus interest for a certain period from a certain date."
I said, a Chinn Comhairle, that I have no words with which I could describe my contempt for a Deputy who wrote that from America, who told everybody he met in America that this money was about to be repaid, and who has the shamelessness to come here to this House and pretend that the attitude had changed from the time of the Judge Peters' decision nearly two years before. I said that there has been a constant intention to pay this money, an intention which has never been changed, and it is one thing at least, in the record of the preceding administration, which I thought was consistent with the dignity and the honour of Irish representatives. But because we, their successors, are going to do this, the Deputy comes along and suggests that we are going to undertake now an obligation that had never been accepted by anybody, and choosing this particular time, although he himself in that statement clearly indicates the time, and although the Minister for Finance in this House repeatedly indicated the time when the repayment was about to be made and should be made.
Everyone of common sense knows that if this House were ever to redeem their obligation there were three occasions on which it should be redeemed. If they had been well advised, if there was not some little meanness coming in and interposing to prevent a right judgment, there were three occasions on which it was natural that the money should be repaid. One was immediately after the Free State was set up. It was the first obligation. I think there are official records in which it was spoken of as the first obligation. The next occasion was when the receivers were about to distribute the money. They should have said then: "There is the balance to be put with this; that completes our obligation." The third is the present occasion when the receivers were getting their final dismissal, when the official report was being received by the court; when the manner of the distribution of the balance which was in the American court was known. That is the third occasion and that is the occasion clearly indicated in several speeches by the former Minister for Finance, and it is the occasion in which this Bill is introduced. Is there any Deputy who has any—I am afraid if I were to say it I would offend Deputies. I ask, however, is there any Deputy, who honestly considers this case, who will suggest for one moment that the proposal to pay this money is brought in by us at any except the right and proper moment, the moment which was determined by those who are our political opponents and who went before us, the moment when the receivers, who were distributing the balance in New York, had completed their labours? Is it suggested that we are acting more generously than they were prepared to act?
I have spoken of the rate of exchange, and I have shown that it is more favourable to-day and is much more likely to be favourable when the moneys are actually being distributed than it was when the promises were made. We might, under certain circumstances, have been adjudged liable for 5 per cent. interest from the date on which the Free State was established. It was the date which our opponents took as the date. They wanted to equate the setting up of the Free State here with the date on which, as far as they could fulfil them, the terms of that bond were to be fulfilled.
We might have been liable under certain conditions for interest for the whole period at 5 per cent. I felt that we were not liable for the whole of that. Portion of the money was kept in America for a considerable period. Whatever interest, little or much, accrued on the money was added to it and it was distributed pro rata.
Again I want to insist that the lawyers representing the bondholders' committee did not take our view. The case they put up to the court was a different case from our case. They felt that the court might have decided against us and they wanted to make sure, if there was a decision against us, that the decision would not mean that the money was going to come over to the Treasury here. They took independent action and had independent lawyers. These lawyers fought to retain that money in America. Looking at the situation as it was, no matter what the de jure position might have been judged to be here, I felt that an American court in these conditions was unlikely to give the trustees that money. A civil war to maintain the republic, or to destroy it if you like, had been fought. There was a definite laying down of arms for the time being by those who were trying to maintain that and an American court might very well say: “Your Second Dáil, that you say this money rightly belongs to, may never be permitted to meet,” and because there was a possibility of that, and that the judge would have set aside what you might have called the strictly legal position and say: “I have here to guard the interests of the American citizens,” I felt that it was very probable that our right as trustees to hold the money might not be accepted by the American court. Those who felt in the same way about it put up a legal case which they thought might possibly mean that the money would be retained in America.
I have seen Judge Peters' decision. I am not a lawyer, but I do know as well as any man living what the conditions were at that time and what the facts were, and I do not agree with some of the findings of Judge Peters' decision. I do, however, say about it that, confronted as he was with a certain set of circumstances in America, it was a practical decision anyhow, and those who were defending the bondholders' interest in America, through their counsel, apparently wanted to secure such a practical decision. Deputy Fitzgerald then gets up and quotes the pleadings of another set of people in the case and tries to say that because these pleadings, put forward by lawyers with a different point of view, were different from mine I could be accused of inconsistency with respect to them. Connivance between the two parties, of course, is suggested. I do not deny that I knew this case was being put up. I opposed it in many particulars and my evidence is quite contrary to the case put up by them. Why should I be accused of inconsistency because the legal case put up by lawyers, appearing for certain subscribers in America does not tally with the case I put up? I put up the case as I honestly saw it from the point of view of a trustee appointed by Dáil Eireann, as President of the Republic with certain rights, and I defended it from that point of view.
Again I ask what is the ground for the suggestion that this Bill is introduced by us at this moment in order that a certain enterprise might get a relatively small sum of money, that the Irish people should pay £1,000,000 in order that a certain enterprise should get a small fraction of it? I have heard many contemptible suggestions in my time. I have heard from all sorts of opponents in the British times, in America and here, many vile and contemptible things said. But the vilest and most contemptible thing I have ever listened to has been the suggestion of the Deputy. As I said, I have felt shame, shame that Dáil Eireann ever employed such a person to represent them in publicity. As I have pointed out, we are paying this money because we believe it is our duty. We are paying it at a time which was fixed by our opponents, and we are paying it at a favourable time. Now what is the suggestion? The suggestion is that I went over to America to pull the wool over the unsuspecting American people's eyes; to wheedle—we had better hear it—from generous Irish servant girls the money which they badly wanted, and not to let them know what they were doing. I did go over to America. I went over to America and raised that money, 5,750,000 dollars. Every penny of that was lodged in my name. That has been the subject of court actions in America, and there was not a breath of suspicion of anything against it until that gentleman over there comes along and suggests it here. I went over as a witness in that case, and I stood in the witness box. Those gentlemen who could go to America on tours afterwards did not dare to go over when I was in the witness box. Their most efficient officer here went over, and when I was in the witness chair he did not dare to go into it, because what I said was true and could be proved. They could not get away with suggestions there. They had not a Press that was completely on their side, so that the other side of the case could not be heard. There was an open court and I went over to that court and faced cross-examination. There was nobody there from the Free State, though they could go over on holidays afterwards, who dared to put in their claim for the 2,300,000 dollars, or whatever it was. They knew they would not get away with it there. There was never a breath of suggestion that all that money had not been properly accounted for.
Because the people in America knew that I would try to keep my word, and that I was not interested in getting money for myself, I felt that I was justified in going over when an enterprise was on foot which, in my opinion, meant much for the Irish people and for their freedom. I went over to raise capital for the Irish Press. Before I left, a prospectus was issued to the Irish people. That prospectus provided for a capital of £200,000, the smallest sum that those who were competent to give an estimate thought the enterprise could be started at. In the prospectus, calculations and estimates were given, and the list of subscriptions closed on the 13th day of October, 1928. The document which was read out, in which it was said that the Irish subscriptions were made in six weeks, is correct. The intention was to get one half of the money here and one half in America. Before this was put to the American people as a proposition, and they were asked to subscribe to it, the Irish people had already shown their confidence by asking for shares for one-half of the capital. Before I went over, definitely to ask for the money for that enterprise, one half of it had been subscribed by the Irish people, subscribed because they knew that a newspaper was wanted. If ever a person went over looking for subscriptions for an Irish enterprise with better credentials I should like to know him. Already, before I asked anybody, more than the share that was open for subscription in Ireland had been applied for.
I should like to point out that in this prospectus there is a certain estimate. The estimate was that machinery and equipment would cost about £80,000; that premises would cost £20,000; and preliminary expenses, including stamp duties, £9,000, making a total of what might be called initial expenses of £109,000. What was the remainder of the £200,000 for? It was for working capital. Why did working capital bear such a large proportion to the cost of equipment? Because everybody who knows anything about newspapers knows that it is two or three years after a newspaper is established before it can pay its way. That is a well known fact. Those who have established newspapers know it, and that comparatively large sum was to be secured in order that the losses which were anticipated— and losses of close on £100,000 were anticipated—might be met.
We have a gentleman who does not mind sabotaging—because it is not a political friend of his who is concerned—Irish industry. He wants to suggest that because there is a deficit, which was anticipated when that prospectus was sent out, this is a bankrupt concern. I have got the auditor's report here. I am asking the Irish Press to publish it. There is not an auditor in the country who knows his business who will not say that this is a good balance sheet, when you bear in mind the terms on which those subscriptions were received and when you remember that that paper is not yet two years in existence. Lest there be any doubt about it I rang up the auditor last night and I said: “I have got the accounts of the Irish Press. I propose, on account of certain things that were said in the Dáil, to mention them to-morrow; give me your opinion as an auditor on that balance sheet; I am going to quote you. Give me your opinion of it as an auditor and say what you think of that balance sheet.” He said: “It is a good balance sheet, an excellent balance sheet.” Then I asked: “Have I your authority to quote that in the Dáil?”“You have,” he said.
And when a public auditor after examining these accounts publicly gives his opinion that that is a sound, good balance sheet for a newspaper, you have got a gentleman here in this House, again I say, who uses the privileges of this House to sabotage an Irish industry. It is an Irish industry. There are 333 employees in that industry. It is as much an industry as anything else that caters to our needs, and a member of this House does not mind trying to sabotage that industry. For what? What reason? What is the compelling motive in the mind of the gentleman opposite who in this case is an outsider? The driving motive is chagrin. At what? That the American subscribers were prepared to subscribe their capital, just as here we had shareholders who subscribed their capital to establish a decent Irish newspaper.
Before I went to America there was already a guarantee of half the capital. I went to America. Did I go looking for an assignment of bonds? I did not. I asked for subscriptions to the capital of the Irish Press and I got more in subscriptions at the time than I got in assignments of bonds. I got more in cash subscriptions. We are to be told after the people assigned their bonds in lieu of cash, after those people handed in their contributions and after this enterprise was started that I took no chances, as the organ of those gentlemen said. I dare not take chances. The people's money was going into this enterprise. There was £100,000 of their money going into it. There was roughly half of that sum already in cash subscriptions in America going into it. What right had I to risk that money and take chances? Of course I took no chances. Before we expended this Irish money in buying machinery which will necessarily diminish in value the moment it is installed, I had to consider whether I was going to take Irish money, hard cash, was I going to take American money, hard cash, was I going to start that enterprise without the minimum capital on which we thought it could be started with success? I knew that the capital would not be required at once. I knew that we had to buy machinery. We calculated that the losses would not all occur in one week, that they would be distributed over a period.
As it was my duty, when I went on a mission of that sort, I carefully calculated when there were bonds being assigned in lieu of cash, whether these bonds would mature to the extent that they would be a necessary safeguard for the enterprise. I took very good care that every commitment regarding that large sum of money was entered into. I saw that I was taking good care to be sure of getting the money assigned. Why should I not? A group of American people came together and suggested that assignments of these bonds should be taken instead of cash. I said all right, on this understanding that they will get credit for the cash they will receive. Before we actually ordered the first part of the plant and machinery we carefully calculated when these moneys were likely to come in and what was to be the amount of this assignment of bonds. I took very good care that in the most definite form there should be a legal assignment. That legal assignment took the form of practically making it a donation, leaving it on my honour so that there would not be interminable actions about it afterwards. It was left on my honour to see that whatever beneficial interest might be in it that benefit would go to the subscribers. There were legal assignments in the most definite form. These were witnessed by two witnesses and attested before a notary public, so that they were good legally and everyone of these went before the judges in the American courts and were adjudged to be proper legal transfers. I dared not take risk. Irish moneys were involved. A whole Irish enterprise was involved if these moneys did not come in.
Now we come to the question of dates. When did I do this? Was it, as the Deputy suggested, when the people thought these were worthless scrip? If anybody thought they were worthless scrip it was not due to lack of publicity as to their value. If there was one thing in America that has been published it is undoubtedly about those bonds and the payment of them. There was the judgment in Judge Peters' court. That was given in May, 1927. These moneys largely were subscribed, I think, in 1929. The money was being distributed then. One of the first steps the receivers took in the distribution of that money was to send a personal registered letter to every bondholder. In America the record about these bonds was not like here. There were settled conditions there. There was a careful register kept in America. We had a proper class of accounting there, and there was a card register of every subscriber. A registered letter went to each subscriber telling him that this payment was going to be made, and telling him to put in his claim. Some of the letters did not reach the parties. There is a considerable part of this money which will never reach the original subscribers because they failed to keep the office notified of their change of address. The State will not have to pay that money. I think it is right that the State should put aside a reasonable share of this money in case applications come in later.
The truth remains that every person who had these bonds got notification of the fact that the claim was to be met. It was not the fault of the Deputies on the other side if anybody doubted that he was to receive the balance with interest. Certainly it was not Deputy Fitzgerald's fault. There are here in this file statements and interviews given by Deputy Blythe during all that period. So great was the publicity that there was nobody who had the slightest doubt at that time that this scrip was value not merely for the money in the hands of the receiver but also for the balance of it, because the intention to pay was preserved there all these years and was at every time carefully advertised in the American Press. We heard very funny tales. The Minister for Defence is here now, and I am sure it will be news to him to hear that Deputy Fitzgerald said that he was told in Philadelphia by a man with whom the Minister for Defence had been that Deputy Aiken, who was soliciting subscriptions from him for the Irish Press, said that Deputy Cosgrave was greatly interested. When you have audacity of that kind in people, when you have that sort of nonsense uttered here, it is mighty hard to keep your patience, anyhow. The facts were published all over America. The assignment made it clear, on the face of it, that people were assigning their complete interest in that money, and it was because of that assignment, which I regarded as worth money, and as equivalent to the cash coming in at the time, that I expected, according to the estimates, we went on with the enterprise. Now we are told that we have, if you please, to ignore these assignments, to ignore the commitments which were entered into on account of these assignments, and that we have to send these moneys back to each individual, although there is a legal contract to the opposite. And why are we to do this? Because Deputy Fitzgerald does not like the fact that American people chose to put their interest in these bonds in the form of subscriptions to the capital of the Irish Press. This Bill proposes that that money should go to the people to whom it is lawfully due. It is lawfully and legally due to go to the Irish Press. Is that a reason why it should be refused by this House?
We are having a new type of morality in finance now. The next thing we will hear is that if we take National Loan Bonds and assign them to somebody, payment will not be made on them because that somebody does not please the gentlemen on the other side of the House. This money is not to be paid, the National Debt is not to be paid, because the people who happen to be legally entitled to it in a proper legal fashion at the moment are not of the ilk that the gentlemen on the other side of the House like. I would like to go a little bit farther. Certain assignments of these bonds were made about the same time or anterior to that to the Mission to China. They were given as gifts to the Irish Mission in China. I suppose Deputy Fitzgerald will want his proof that they got 60 cents on the dollar on their assignment. Assignments were made, if I remember aright, for the Father Yorke Memorial, a memorial erected by the people of San Francisco to a great Irishman. On the strength of these assignments certain work was proceeded with. Is that work now to be cancelled because Deputy Fitzgerald does not mind whom he hits so long as, in his wild swiping, he tries to get in a blow at the Irish Press.
We are opposing this amendment. It is dictated by one reason and one reason only, and that is because it is giving to an enterprise that the gentleman opposite does not like, certain support. If there were corruption it would be on the part of gentlemen on the other side if they were here, because they would, undoubtedly——
