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Evening star. [volume] (Washington, D.C.) 1854-1972, November 21, 1937, Image 16

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Steamship Captain Heard of
Plot to Foul Steering En
gine at Tampa. .
By the Associated Press.
TAMPA, Fit., Nov. 20.—Ctpt. Rob
ert F. Lord of the steamship Cuba told
t National Labor Relations Board ex
aminer today the vessel was taken out
of commission here last June because
Of threats of sabotage by crew mem
Lord testified there was dissension
among the seamen over two rival labor
unions on a passage from Havana to
"I knew there was something wrong
somewhere,” he said. “There was an
argument about the union affiliations
of a stewardess. Members of the stew
ards’ department were getting in
bunches and carrying on conversa
"I kept thinking about the Morro
Castle-” /
Joseph Hoskins, board attorney, ob
jected and was sustained.
When the Cuba reached Tampa, the
master said, a conversation overheard
in the pantry was reported to him.
'"The conversation was to the effect,”
he said, “that they would see that the
ship didn't sail the next day even if
they had to foul the steering engine.
• • * There could have been fights
and brawls. The company ordered
the ship tied up indefinitely.”
Lord was the final witness of the
hearing, called on complaint of the
National Maritime Union, affiliate of
the C. I. O., of discrimination by the
Peninsular & Occidental Steamship
Co. in favor of the International Sea
men's Union, A. F. of L. affiliate, with
which the company held a contract.
The N. M. U. charged its men were
discharged without cause and the
Cuba tied up to get rid of them. The
company replied it acted without bias
a,ween the unions, was attempting to
fill contractual obligations, and tied
up the ship for public safety.
When Installation of New Offi
cers Is Held, Dr. Mino Will
Be Given Gold Medal.
Ralph Cipriano has been elected
president of the Lido Civic Club, it
was announced yesterday.
Also elected at the meeting held at
the Mayflower
Hotel were Dante
Gslotta, first vice
president; Al
phonso Tana,
second vice presi
dent; Prank De
N u n * i o , secre
tary; Dr. Samuel
Amato, treasurer;
Julius Marchi,
sergeant at arms,
and Victor E.
Desio, director of
At the installa
tion of the new Mr. aprlaB#
officers, the re
tiring president, Dr. Joseph De Mino,
will be given a gold medal.
Choral Society to Join G. W. IT.
Glee Club in Concert With
The Christmas candlelight service
at Epiphany Church will be abandoned
this year to allow the Washington
Choral Society to join the George
Washington Glee Club in a concert
with the National Symphony Orchestra
December 19 at Constitution Hall.
This was decided at a meeting of
the Advisory Board of the society
yesterday, when it was revealed the
choral group will participate in the
rendition of the Beethoven "Ninth
Symphony” with the glee clubs and
symphony orchestra.
At the same time it was revealed
the society Intends to increase its
chorus from 140 to 200 members.
Rehearsals are being held each Tues
day at S p.m. at Central High School.
Enlargement of the chorus is intended
before rehearsals start on the Bach
"Passion According to St. Matthew,”
which will be sung March 21 in com
memoration of Bach's anniversary.
(Continued From First Page.)
aity of Southern California, Paul
Douglas of the University of Chicago,
Abraham Berglund of the University
of Virginia and Morton A. Aldrich
of Tulane University.
Not all the economists thought
Congress could relieve the situation.
Some held that the remedy lay in
co-operation between labor and busi
ness on wages, prices and steady em
ployment. Others said business could
pull itself out of the hole by holding
prices down and thus increasing con
sumption. One asserted that a hous
ing drive, properly conducted, would
set things going full tilt.
Of the experts who urged action by
Congress, some were strong for giving
more credit control to the Federal
Reserve Board. Others contended
credit had nothing to do with the
problem. Some wanted taxes up.
Some wanted taxes down. But all
' wanted business to get the feeling,
»• one put it, that the Roosevelt ad
ministration was ready to “make
Mr. Friday summed it up emphat
"There is need of some definite,
dramatic action to show that Gov
ernment promises of helping business
Is more than just a lot of talk.”
“Abolish the Tax!”
Such "dramatic action,” he said,
would be to "abolish the undistributed
profits tax.” He added:
"If they take (it) off * • * business
is going to expand plant immedi
ately, and that will create a good
deal of construction work where It
is most needed. New taxes to re
place the undistributed profits levy
would not be necessary because we
already have the social security tax
to take its place.”
Is a balanced budget essential?
"No,” Mr. Friday said. "In the
long run it is essential, but not now.
Talk of balancing the budget now is
ah academic anyhow. Nobody’s going
to do It.”
One at the proponents of credit
control was Prof. Fisher. Said he:
"The main reason for the present
recession, as well as for the original
depression, was monetary; the main
remedy must be monetary.
"Between 1929 and 1933 the Na
tion's check-book money (demand de
posits) shrank by $8,000,000,000. That
great shrinkage could not help but
make a great depression. Between
1933 and 1936 that shortage of money
was more than made up. Its restora
tion could not help but make recovery.
“In 1937 this money supply has
been shrinking again. So far it has
shrunk by *1,000.000.000. That shrink
age could not but make a recession
Restoring the shortage would largely
cure the recession.
Federal Lending Urged.
"The best method is one which
could be applied almost overnight if
Congress would enact the necessary
"This method is for Federal Re
serve banks to lend to member banks,
without interest, enough new bank
credit to bring present 20 per cent
reserves behind demand deposits up
to 100 per cent so as to get the vol
ume of our money under control, and
then to buy bonds with still more
credit until enough deposits shall be
in circulation to bring back prices,
business and employment.
"Another effective remedy would
be to speed up use of our money
by encouraging business, especially
by repealing the capital gains tax
and the tax on undistributed profits.
“There are other factors, of course.
"Balancing the budget is desirable
as soon as feasible, but it has far less
to do with our prosperity problem
than commonly supposed. In fact,
it wws through our unbalanced budget
that recovery up to 1936 was actually
accomplished. The Government sold
its bonds to banks, receiving In turn
demand deposits. This new check
book money was spent not only by
the Government, which thus put it
into circulation, but it was respent by
the public at least 20 times a year.
"Yet it would be a mistake to re
turn now to an unbalanced budget
as a method of restoring the destroyed
"Reduce Taxes.”
Another advocate of credit control
by Congress was Mr. Cromwell, econo
mist husband of the former Doris
Duke, the tobacco heiress. Mr.
Cromwell, who is being considered
as a successor to United States Sen
ator Harry Moore of New Jersey,
"The first remedial step to be
taken is drastically to reduce income
and corporation taxes, particularly in
the higher brackets. This would in
duce capital to flow into industry and
thereby increase employment and
raise the bargaining power of labor.
"As matters now stand, the money
of the wealthy, which would other
wise be used in the creation of new
business and new jobs, is hidden away
in tax-exempt securities, is lying idle
in banks or is hoarded in safety de
posit boxes.
“The result is that the Govern
ment pays out in doles and for un
productive public works the very dol
lars which should be used to create
new business and give employment.
“Only about 15 per cent of the
total expenditures of the Federal Gov
ernment is procured from the super
taxes upon the incomes oi the wealthy
individuals and corporations—yet it
is the extraction of this stream of
life blood from our national economy
which has brought on the present
serious recession.
Budget Will Balance Itself.
"When tax reduction has engen
dered an increased national Income
and flow of goods, then the second
remedy is for Congress to equip its
agency, the Federal Reserve Board,
with the means to positively regulate
the flow of our money and to synchro
nise it with the flow of manufactured
and agricultural products. Then, and
not until then, can national prosperity
and full employment securely and
permanently be attained.
“The budget will balance itself if
the national income can be raised to
one hundred billion dollars or more
a year. It is impossible to balance
the budget now because we must con
tinue to support our unemployed dur
ing the recession. This Nation can
easily afford an unbalanced budget for
another couple of years."
An entirely different point of view
on credit came from Col. Ayres, who
contended the cure for the present
slump “cannot be successfully sought
in monetary or credit stimulants, but
it could be found through removal
of business barriers” by Congress.
“Restoration of railroad and utility
purchasing power,” he said, "would
do it.”
A balanced budget, Col Ayres held,
“is not immediately essential, but it is
essential that .the public become con
vinced that the administration is de
termined to balance the budget and
steps should be taken now to that
Dr. Calvin Hoover of Duke Univer
sity said a balanced budget would be
"desirable” but “realism compels the
recognition that it is likely to be im
possible if the present business reces
sion continues.”
"Congress should, however,” he said,
“follow a policy of selective restriction
of expenditures and of reforming tax
ation. directed at both conserving and
mobilizing taxable resources to meet
possible emergency needs. No new and
costly legislative programs should be
embarked upon which emergency does
not dictate.
“There is the utmost necessity at a
time like the present, when the pos
sibility of a relapse into depression
exists, that business should develop a
far more conciliatory attitude toward
labor, that labor leaders should make
the most strenuous efforts to main
tain labor discipline and that both
should develop an increased sense of
national responsibilty. Finally, the
present mutual hostility between busi
ness and the administration must
somehow be resolved if recovery is to
be resumed.”
This plea for co-operation between
capital and labor was echoed by Dr.
King. He urged the two to "get
together on a program of lower prices
for goods, lower wages per hour and
steady employment.”
From the legislative point of view,
Dr. King was all for economy. He
proposed that working hours on work
relief projects be increased to 60 a
week with pay remaining at its present
weekly level. He advocated that “able
bodied workers” be cut from non-work
relief payments. He suggested that
“all subsidies, to farmers and others,"
be stopped. “To bring the price level
back to where it was at the beginning
of the year,” he recommended that
the Federal Government “buy Federal
securities in the open market to what
ever extent necessary.’ This last, he
said, would stimulate demand for goods
I and halt lay-offs of workers.
ana or federal competition.
Mr. Ault said Congress “should
assure the country that it in no way
will directly compete with any busi
ness enterprise, but assert its right to
regulate business activities.' and
should also “amend the National
Labor Relations Act to make it (labor)
responsible for its acts."
“The advantages of a balanced
budget far outweigh any good that
might come from more deficit spend
ing.” Prof. Ault added, asserting
“balance the budget by (1) decreasing
expenditures and <2> modifying our
tax laws; (a) revise the undistributed
profits tax and <b) broaden the in
come tax base.”
Mr. Anderson advocated balancing
of the budget by economies, repealing
the undistributed profits tax, reducing
the capital gains tax to a low flat rate
“which would increase revenue from
that source,” relaxing restrictions on
the security markets, defeating the
wages-and-hours bill now before Con
gress. assuring utilities “there will not
be Government competition," restoring
international trade.
Addressing himself to industry.
Economist Anderson urged reduction
in the price of steel and a shift of
wages of building trades workers from
an hourly to a yearly basis, "which
means sharply reduced hourly rates
and increased annual income through
increased employment.”
Two Other Plans.
Ragnar D. Naess, economist for
Goldman, Sachs & Co., took the view
that “we cannot legislate prosperity”
because “basic economic factors were
the most Important cause of the cur
rent decline.” A balanced budget
would help, he said, but “win not
turn the situation." Modification or
repeal of the capital gains and un
distributed profits taxes would also do
good, he added, but they were “un
likely to change near-term prospects
much.” The housing program, farm
price control and railroad rate in
creases, in his opinion, should come
unly later when general business
readjustments are more nearly com
pleted." And all business can do,
he said, is “take necessary steps to ad
just costs, reduce inventories and sup
ply greatest possible employment.”
Dr. McClung, dean of the College
of Commerce and Business Adminis
tration at the University of Southern
California, had a five-point program
for Congress and three-point one for
business. The points:
For Congress: (1) Remove tax ex
emptions from all securities and from
Incomes of Government employes; (2)
“give definite assurance” expenses will
be cut and taxes held down; (3) don't
worry about immediate balancing of
the budget; (4) give control of P. W.
A. spending to local agencies; (6)
make labor unions “financially re
For business: (1) Promote the
right to organize on the same basis
on which labor unions now organise;
(2) end duplication of retail outlets
and other means of overproduction;
(3j “Use more peaceful persuasion in
government rather than mere con
Co-operation between business and
government was the program of Prof.
Douglas. The field should be hous
ing. he said, adding:
"To make such a program effec
tive, housing casts must be reduced
so that the rent of the buildings and
apartments will be somewhere within
the ability of the low income groups
to pay. This will require co-opera
tion in reducing unit costs on the
part of the four following groups:
"(1) The owners of city and su
burban real estate who need to aban
don the idea that their land may be
covered by skyscrapers in the future
and who will i therefore squeeze the
speculative element out of their hold
"(2) The material me*
"(3) The contractors.
“i4) The unions of skilled busi
ness crafts.
“If all these groups will simultane
ously and concertedly reduce their
rates, the result should be a great ex
pansion in building which will result
in much larger total incomes for all.”
The budget. Prof. Douglas said,
need not be balanced until the return
of prosperity, when a surplus should
be accumulated.
Abolish High Tariff.
Prof. Berglund criticized "certain
contradictions between Industrial
trends and political policy. We have
developed business technique making
for lower costs, but we legislate to
maintain and even increase com
modity prices.”
For business. Prof. Berglund rec
ommended "abandonment of policies
aiming at price maintenance and in
creases.” For Congress he proposed
"abandonment of our high tariff policy,
early balancing of the budget even if
it involves some additional taxation,
and adoption of a regulatory program
designed to eliminate predatory rather
than productive processes” in business.
Prof. Aldrich, dean of the College of
Commerce and Business Administra
tion at Tulane, put the problem of re
covery squarely up to business. Said
"Business organizations will find it
to their interest at this time to hold
their prices down. This applies espe
cially to manufacturers. In some cases
this will mean that they lower their
prices, and in others that they do not
raise them.
“This statement would have more
effect if said by a business man than
by an economist. Plenty of business
men believe it. If a group of 10
business men in whom other business
men have confidence made this state
ment, it would have a really large
Give Recovery Views
James H.R. Cromwell. Dr. B. M. Anderson. Dr. P. H. Douglas.
-Harris-Ewing and Underwood & Underwood Photos.
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