Evening star. [volume], April 19, 1938, Page A-9, Image 9

About Evening star. [volume] (Washington, D.C.) 1854-1972

Image provided by: Library of Congress, Washington, DC

                
Control of Tax
Group Laid to
Roosevelt
President Should Allow
Changes in Bill, View
of Observer.
By DAVID LAWRENCE.
NOT long ago President Roosevelt
issued a public statement de
nying that he had the qualifi
cations to become a "successful
dictator" and the explanation was
accepted as meaning, of course, in a
European sense. But the developments
of the last few
clays indicate
that a dictator
In the American
sense, that is
strictly within the
letter of the Con
stitution, is pos
sible through the
presidential office
and that it can
affect the eco
nomic welfare of
the country to a
marked degree.
Thus, for in
stance. the Presi
ha* nnripr
David Lawrence.
taken to deprive the American people
of tax revision legislation this year
by the simple device of compelling the
conference committee to stay in dead
lock. Mr. Roosevelt has control of
the House members of the joint con
ference committee which, as .is the
custom, seeks to iron out differences
between the House and Senate. He
does not control the Senate members
Of the conference.
The chief items in dispute relate to
the penalty tax on thrift and savings
which has been one of the major
causes of the present depression and
which Mr. Roosevelt refuses to allow
to be eliminated from the tax laws.
He thinks that the House bill which
changes the rates somewhat should
remain and that the principle of
taxing savings and thrift should be
retained.
The Senate, on the other hand,
wants to wipe out the penalty tax on
thrift and give American business a
chance to function. Mr. Roosevelt
exercises some sort of powerful influ
ence over the House members of the
conference because they refuse to per
mit the matter to be submitted to a
vote of the House of Representatives.
Vnable to Get House Vote.
Again and again the Senate mem
bers of the conference eomnuttee
have suggested that the House mem
bers tak« the subject hack to the
membership of the House of Represen
tatives for a vote but to no avail.
The Senate passed its own bill by an
overwhelming vote and the Senate
conferees are united to a man. Dem
ocrats and Republicans, in favor of
eliminating the penalty tax on thrift.
As a rule when a deadlock like this
occurs there is a delay and then an
attempt at compromise. But, usually,
too. members of the House and Senate
feel that they can exercise their inde
pendent judgment without pressure
from the Executive. In the present
Instance there has bpen no formal
notification that the President would
veto the bill if it. did not contain
the House provisions which he wants.
Certainly the conference is entitled
to formal word on the President s posi
tion if he Is to exercise pressure at
this stage of the proceedings, for it
will be recalled that he did not indi
cate any such course when the measure
was before the Senate.
A President has a right, of course,
to indicate what legislation he might
veto, but is under no obligation to do
so. There is. on the other hand, no
justification for his threatening secretly
to use the veto power. As matters
stand today, by controlling the House
members and persuading them not to
take the matter back to the House,
a deadlock can result in the failure of
the whole tax bill to pass at this ses
sion.
When to Use Pressure.
There is reason to believe that Mr.
Roosevelt is making use of exactly
that argument through his henchmen
on the House committee. It would
seem that the President would hesitate
to use any pressure, direct or indirect,
with a conference committee composed
of men who are under obligations to
him.
Thus, for example, as we pointed
out recently in these dispatches, Rep
resentative Vinson of Kentucky, who
Is one of the leading members of the
House Conference Committee, already
has received from the President a life
Job as a Judge of the Circuit Court
of Appeals of the District of Columbia.
He has delayed taking the oath so that
he could remain on the conference
committee though he was actually
confirmed as a judge early last De
cember. a most unusual proceeding.
The country can hardly look upon
the handing out of judgeships under
these circumstances as wholly free
from suspicion especially when the
President has precipitated a contro
versy between the House and Senate
conferees and Is in,a position to get
his way through the vote and influence
of a man who has just been awarded
a high Federal office.
The pending Senate tax bill has
been regarded as one of the important
eteps toward re-em ploy men t. Its pas
sage has been awaited ever since last
autumn, when Nation-wide sentiment
for tax revision began to crystallize.
Many people now' out of jobs will be
benefited if Congress assumes a posi
tion of fairness toward the develop
ment and expansion of business. To
cause the proposed tax revision to fall
through deadlock of the conference
committee means that the present law,
with its vicious tax provisions, will
atay on the statute books.
It is true Mr. Roosevelt could veto
the bill and then two-thirds would
be required in both houses to override
his veto. But this is an election year
and two-thirds of the members of both
houses would rather record themselves
as being In favor of measures that help
instead of retard recovery. What is
Important, however, is that Mr. Roose
velt at the moment is preventing the
matter from coming to a vote in the
House and he is doing it by undue con
trol over the House Conference Com
mittee. a situation which only an
alert public opinion can possibly cor
rect.
(Copyright, 1938.)
RESORTS.
Atlantic cn*y, X. J.
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HOTEL DENNIS
OK THC BOARDWALK /
DELIGHTFUL IN SPRING /
> WAITES J. »UZ»Y. It.
TRAVEL.
BTEAMSHIPTICKEfS
over All lines.
Travel Department
AMERICAN EXPRESS COMPANY
The Capital Parade
Details of Rejected Plans to Combat Recession Reveal
What New Deal Advisers Are Thinking.
By JOSEPH ALSOP and ROBERT KINTNER.
IN GOVERNMENT, and especially In the palace politics of the White
House, the things that aren't done are often quite as Interesting as the
schemes that see the light of day. Plans with the President's "no”
written across them not only indicate what he is in a mind to reject:
they also suggest the thinking of the powerful presidential advisers, in whose
minds they originate.
This was especially so with the immensely numerous proposals
which poured on the presidential desk in the two weeks before the
final announcement of his spending program. All the doers, the new
deal advocates of action, had been driven close to madqess by a winter
of stagnation. When word came that the President was ready to act
in positive fashion, they hastened to put before him the many notions
they had cooked up in the months of anxious waiting.
A certain amount of digging has produced a reasonably comprehensive
selection of the things the President chose not to do. As will be observed,
most of them are more startling than the mild public works spending
which he did choose to do. Beginning with those plans which would have
required an authorising act of Congress, the selection follows:
1. Loans to railroads: Permis
Minn f nr tVia T? As»r\n •tvnotton IS nan/ia
Corporation to make unlimited
loans for railroad maintenance and
capital expenditures. Permission
for the President to establish the
terms of lending, as a substitute
for the present required I. C. C.
certificate of solvency.
2. Taxes: A tax exeirmtion
running until 1940, on all profits
gained from private building of a
type classified as socially desirable and helpful to recovery.
3. Land development: The establishment of a Federal land
development: The establishment of a Federal land development au
thority, to be financed with $100,000,000 of capital borrowed from
the R. F. C. and $1,000,000,000 borrowed from the public in Govern
ment-guaranteed bonds; to be authorized to build toll highways,
bridges, viaducts and practically anything else approved by an ad
visory council of land-planning experts.
4. Public health: A program of Federal medical aid for the sick,
needy, partly through Treasury grants for hospital equipment, and
partly through a direct Federal expenditure on nurses and medical supplies
for ailing reliefers.
5. Railroad equipment: The establishment of a U. S. railroad
equipment authority, to spend $1,500,000,000 on new railroad equipment’
for renting to the roads. This scheme was already revealed here as
originating with Lauchlln Currie, Federal Reserve Board economist. As
finally presented to the President, the scheme's blueprint was less radical,
in that the authority was not permitted to manufacture the equipment
itself.
6. Expanded capital market: The establishment of a system of reg
ional underwriting banks, to supply capital to industry; the banks to be
jointly controlled and financed by the Federal Government and local
private interests. This was ^he Federal underwriting scheme of Chairman
William O. Douglas of the Securities and Exchange Commission, also
first revealed here some weeks ago.
So much for the six proposals which would have required Congressional
authorization. The three following required only an executive order
from the President:
1. Utilities construction: A program for $500,000,000 in R. F. C. loans
to utilities operating companies, the companies to be induced to borrow
by enticing credit terms.
2. Cash for little business: A program of lending to companies,
especially small industrial companies, with heavy unsold inventories.
The loans were to have been made by banks, and guaranteed up to 90
per cent by the R. F. C. The period during which the R. F, C.
could offer its guarantee was to have been limited to 30 days, and
no loan was to have been permitted to exceed $100,000, or one-flfth
the borrower's total resources. This scheme emanated from the
S. E. C.
3. Housing: The establishment of another housing corporation, to
build large numbers of low-priced dwellings with relief money, but under
the joint direction of the Federal Housing and Farm Security Administration.
Pont throw
these away
% IMA> need
Not all these plans, by any
means, are necessarily abandoned
for good. The Douglas Federal
underwriting idea, for example, still
has important backing in the high
est quarters. Surveys are still in
progress to discover whether, as
some proponents of the plan assert,
private interests would be willing to
offer capital for Federal underwork
ing banks.
The loans to inventory-heavy
| little business also appeal to many powerful White House advisers. The
lavish loans to railroads also might have been made, had not the New
Dealers feared the opposition of Senator Burton K. Wheeler of Montana,
And if the present spending program fails, if the depression deepens, any
or all of the other white rabbits may yet pop out of the hat.
(Copyrichi. m.iv, by the North American Newspaper Alliance, Inc.)
SPEEDER IS FINED $25
FOR FOURTH OFFENSE
Truck Driver Given Suspended
Sentence on Revoked Permit
Charge.
In one of the few convictions on a
charge of fourth-offense speeding,
( Henry G. Johnson, colored, 208 I
i street S.E.. was sentenced by Judge
Walter J. Casey in Police Court yes
terday to pay a fine of $25 or serve 30
days in jail. He also was given a
suspended sentence of $100 or 30 days
for driving on a revoked permit.
Johnson, who was arrested by Pvt.
O. F. Fus'. while driving a coal truck
at 37 miles an hour past Mount Alto
Hospital, pleaded guilty to the speed
ing charge and not guilty to the per
mit charge. He told Judge Casey that
the company for which he works
changed from District of Columbia to
Virginia license tags and he was driv
ing on a Virginia permit. He said his
speedometer was not working.
The defendant, was previously con
victed on speeding charges March 8,
1937; September 14, 1937, and No
vember 23, 1937.
YOUR ROOF, TOO——
—can be sound tight, free from
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kind? Our thorough repairs will
Iasi, keep things dry. Summer
rains are surely coming. Better
send for us and feel safe.
KOONS Roofing AIM V Street N.W.
I Company North s It'll
1 1
! Rancher. 100, Gets
Three-Year Lease
On Federal Trad
Arizonan, Breaking Colt,
Declared to Be Very
Active.
By the Associated Press.
The Interior Department offered a
3-year lease on Government grazing
land to 100-year-old Ned Hillyard, a
Pomerene, Ariz., rancher yesterday.
The Department said an investiga
tor. instructed to determine whether
Mr. Hillyard should have a long-term
lease, reported:
"Hillyard was alone at his ranch
on the date of examination and was
engaged in breaking a bucking colt.
He is remarkably active and I can see
no reason for refusing him a lease for
a few years at least.”
HIGH BLOOD
ALUM IN Essence
rKtaullHt of Gar,lc * Parsley
■ HkWVIlfti Tablets used regu
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majority of cases. Dr. Frederic
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sician. reports such relief in 22 out
of 26 cases. ALL!MIN Tablets are
for sale by good drug stores every
where In two sizes—50c and $1.00.
When you buy, insist on getting the
genuine ALTJMIN. For valuable
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YOUR
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9.0x12.0 2.16 4.86
8.3x10.6.. 1.72 3.87
60x9.0— 1.08 2.48
4.0x7.0... .56 1.26
3.0x6.0.._ .36 .81
2.3x5.0— .25 .54
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Dusting prices for Oriental
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*
(THE opinions of the writers on this page are their own, not
necessarily~The Star’s. Such opinions are presented in
The Star’s effort to give all sides of questions of interest to its
readers, although such opinions may be contradictory among
themselves and directly opposed to The Star’s.
Real 'Pump-Priming’
New Dealers Outdo Old-Fashioned Methods by About
17 Billions, Observer Says.
Mark Sullivan.
By MARK SULLIVAN.
THEY say they are going to
"prime the pump"—headlines
blaze with that phrase. I
wonder what picture arises in
the minds of the younger generation
when they hear that figure of speech.
Does any picture arise? Or do they
think “priming.
the pump” is |
merely a kind of |
magic phrase, an
abracadabra, or at
best an incanta
tion accompanied
by motions, like
the witches mak
ing their brew in
Macbeth?
I know what
“priming the
pump” is, for I
have seen it done
and done it my
self often on the
was born and on which I still spend
much of my time. But today the
farm pump is electric. My children,
like most of the younger generation,
have never put their hands on a pump
handle. To them it is the same on
the farm as in the city—the source
of water is a pipe, the means of pro
curing It is turning a tap.
The pump on the farm when I was a
boy was homemade. At least I think it
was made on the farm, for after it was
taken up and thrown on the pile of
old lumber behind the corncrib it
looked hand-hewn. As I remember, it
was of w'ood, about 25 feet long, with
a hole some 2 Inches in diameter run
ning from end to end. Whether the
pump could have been made on the
farm I do not know There was an
old sawmill, driven by water power,
about an eighth of a mile away. Pos
sibly the old pump was made by the
sawyer.
Up and down through the tubular
hole in the pump ran a rod. Fastened
to the bottom of the rod was a suction
cup about the sise of a teacup.
The cup was made of leather, its
seams sewed w'ith shoemaker's thread.
If the pump was unused for a few
hours the leather berame dry and the
cup would leak. Then arose the
necessity for priming.
How to Prime the Tump.
To "prime the pump" it was neces
sary to pour a pail of water in from
the top. If w-e were prudent we always
kept a pail full for that purpose. If
we were not prudent we had to carry
a pail some distance from a spring.
Normally one pail was enough. If one
pail did not make the pump work we
knew that something extraordinary
was wrong with it. something more
than could be cured by priming.
Pump-priming by government Is
something new. As an economic theory
its chief exponent is an Englishman
who became prominent after the Great
War.
The pump-priming w-hich the New
Deal is now embarked upon will, we
are told, stimulate the resumption of
the recovery movement. It will start
construction projects, and these will
put men to work, both on the Jobs
themselves and In industries manufac
turing supplies. And the money paid
out In wages and salaries will in turn
be paid for so-called "consumers'
goods"—food, clothing, and the like.
This spur to activity, it is said, will
give to the country’s economic engine
enough impetus so it will acquire a
velocity sufficient to keep it going of
its own power.
That is what they sav. Well,
maybe! But we can’t help remember
ing that that Is the game thing they
said five years ago, when they began
their first pump-priming.
The amount of money the New
Deal has already poured into the
economic pump is much more than a
pailful, very much more. The in
crease in the national debt since 1933
is some 17 billion dollars. (Actually,
the total of spending and lending
combined is much more.) And the
total amount of money (currency and
bank deposit money) in the country
in normal times, when the pump ie
running at top speed, is 80 to 9C
billion dollars. In short, the New
Dealers, to prime the pump, have
poured in what would be the equiva
lent of a fifth of all the water in a
full well. Clearly more is wrong than
ran be cured by priming.
Just what is it that Is WTOng? To
be dogmatic on that question would
be to encounter disagreement and
debate. Some put emphasis on cer
tain forms of taxation which have the
effect of strangling the pump—espe
cially the tax law which forbid?
corporations to save, requires them tc
pay out practically the whole of their
earnings at the end of each year, sc
that if recession comes they have nc
reserves with which to carry on.
Some put emphasis on policies ol
the administration which have created
doubt about the future value of the
dollar, its future purchasing power
Owners of money do not like to lend or
a long-time basis if they fear that If
years or 20 years hence they may b<
repaid in dollars which have only the
purchasing power of half dollars, oi
even quarters.
Some put emphasis on "lack of con
fidence." Lack of confidence in what’
However, let's not discuss that at this
time. In some quarters the lack ol
confidence goes so far as to be an
apprehension lest our very form oi
society and form of governmnt may
be changed.
Well, as an old pump-primer myself
I think a good deal besides priming
needs to be done. And, even more
important, some things need to be
undone.
(Copyright, laas,)
i WHO’S WHO IN CAPITAL
TO HAVE 9,000 NAMES
Preliminary Work Now Is Under
Way on 1938-39 Issue of
Biennial Volume.
Biographical sketches of approxi
mately 9.000 prominent residents oi
the National Capital will be mcludec
in the 1938-9 issue of "Who's Who ir
the Nation's Capital." on which pre
liminary work is well under way
Ransdell, Inc., publishers, announced
today.
The last Issue of the publication
which has been printed bienniallj
since 1921, carried more than 8,00<
biographies. Several hundred o
these will be omitted from the nev
book due to rapid changes in Wash
ington's population, the publisher!
announced. Nearly 2.000 new entries
however, will be made.
Correction forms are being mailet
to those who appeared in the las
book and questionnaire forms will bi
mailed to new names chosen by i
group of 30 consulting editors.
"The same exacting qualification:
for admission to 'Who's Who' will b<
maintained and the same rigid edi
torial policy followed," the publisher
stated.
^<6Me our nmtepFAnsrsmw ontMTM!^
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A
We, the People
Foes Believe They Can Make Dr. A. E. Morgan Look
Extremely Foolish at T. V. A. Probe.
By JAY FRANKLIN.
THE curious reluctance of eminent Republican Senators to serve on the
congressional committee selected to investigate the Tennessee Valley
Authority is now understood to arise from the realization that T. V.
A. is a pretty hot potato—politically—for the opposition to handle
and that the investigation itself is not calculated to lend aid or comfort to
that hero of the super-heated tories, Dr. Arthur E. Morgan.
As a matter of fact, there is a red-hot labor and an incandescent
farm angle to the investigation which is calculated to scare off all
but the boldest O. O. Practitioner. Dr. Morgan has unfortunately
taken a strong position in favor of the now illegal company union, an
institution which he has praised as “a golden opportunity for those
in control of industry to discover an approach to industrial democ
racy and to develop capacity in workers for sharing both oppor
tunity and responsibility.”
His original labor-relations plan for T. V. A. is described as being a
highly paternalistic “company union,” which the other directors had to
scrap as un-American. Labor or
ganizations are anxious to bring
these facts to the attention of the
committee.
Moreover, in his effort to find
■ grounds for attacking Dr. Har
court Morgan. "A. E." attacked
the land grant colleges and the
agricultural county agents as ele
' ments in a "political machine.” If
this charge were true it would be
tactless and the farm oreanizat.inns
involved do not think that it is true. So they, also, are burning to testify.
This accounts for the reluctance of Senator Capper to serve, while if Jim
Davis of Pennsylvania accepts a place on the investigating committee he
will risk losing labor support in his race for re-election as Senator this fall.
People close to the Tennessee Valley Authority believe that they have
enough on the record to make Dr. Arthur E. Morgan look extremely foolish,
as well as enough fb suggest that he is the blind tool of interests opposed to
the whole T. V. A. development.
On the minute books of the Authority, as well as in its records,
there are said to be extraordinary proposals emanating from the for
mer chairman, for setting up a collective economy with its own cur
rency in the valley, for paternalism of a rather silly sort—including
a proposal to select “proper mates” for the reconditioned hill-billies
in the model towns of the region, a remarkable scheme for the town
of Norris, a strange ‘ code of ethics" which Dr. Morgan circulated,
and other ideas which suggest that the chairman was trying to “play
God” in the valley or at least to order the lives of American citizens
as though they were inmates of a public institution.
In addition to this, there are purely practical matters into which the
T. V. A. proposes to inquire: The source of the contributions to the al
ir^ru »iuu,uuu ±vjv_7i£aii vrcicjio';
fund.” the number of hts associates
—past and present—who have con
nections with big utility interests,
and certain mystifying matters
surrounding the now famous "Ber
ry marble claims ”.
A congressional investigation
is not a pink tea and odds are be
ing offered in T. V. A. quarters
that after the inquiry is launched
Dr Arthur E Morean will decide
that the committee he asked for is incompetent to give him a "fair” trial
and will refuse to co-operate.
Those who appeal to Caesar generally find that they don't like the
man-in-purple who hands down the decisions, but to Caesar they must go
just the same. In all this, it is important to note that there is still no dis
position in administration circles to question the sincerity or honesty of
Dr. Arthur E Morgan. They feel that he Is the victim of his own code of
moral conduct, a code so rigid that they assert he once seriously proposed
that the T. V. A. purchase no land for any purpose whatever from people
of whose ethics he disapproved
iConyrieht. inas. R«sister and Tribune Syndicate.)
I
LABOR DEMAND TIES UP
PUERTO RICAN SHIPPING
—
C. I. 0. Clerks' Union. Insists
Upon Complete Unionization
of Office Staffs.
Fy the Associated Press.
; i SAN JUAN, Puerto Rico, April 19.—
All steamship lines operating here
’ today ceased accepting or discharging
cargo after having received demands
from a clerks' union, affiliated with the
Committee for Industrial Organization,
for complete unionization of office
staffs.
The demands had the backing of the
stevedores’ union, which tied up all
1 Puerto Rico shipping from January 3
■ to February 10 in a strike for higher
wages and other concessions. The
1 clerks demanded that all steamship
' company shore employes not in the
■ stevedores' organization be included
! in their union.
The demands were referred to Labor
; _
Commissioner Rivera Martinez, who
arranged to meet with labor leaders
later today.
William Penn on Education.
William Penn, founder of Pennsyl
vania. is dead more than 200 years,
yet what he had to say is often as fresh
and vital as though he talked today.
"That which makes a good constitu
tion," he once stated, "must keep it,
namely, men of wisdom and of virtue;
qualities that, because, they descend
I not with worldly inheritance, must be
; carefully propogated by a virtuous edu
cation of youth, for which spare no
| cost, for by such parsimony all that is
! saved is lost."
-•
Rescuers Carry Radios.
To resceu winter sports enthusiasts
in distress a mountain corps of men
and women has been organized in
Switzerland, and each member will
carry a short-wave radio set w+ien
starting on an errand of merey.
An American
You Should
Know
Admiral Land Right
Man in Right
Place.
By DELIA PYNCHON.
PARADOXICALLY Emory 8.
Land has always followed the
sea. For 39 years he served
In the United States Navy,
midshipman to rear admiral. Now h«
Is chairman of the United States Marl,
time Commission.
He has on his hands the bigs;est
Emory R. Land.
jod ne ever raca
led—and he has
tackled plenty.
It Is to build up
and maintain an
American mer
chant marine ad
equate for the de
mands of Amer
ican commerce,
and for national
defense in war
time.
Admiral Land
was an outstand
ing athlete and
looks it. He is
".Tprrv” T.onrf to
the Navy—the man who scored the
touchdown that beat the Army m
1900. He was crew and track man,
too.
He discusses his present maritime
problems w'ith a frank, friendly smile.
His ideas are quite definite. He does
not like the reputation for lack of
discipline, which the American mer
chant marine has acquired. His num
ber 1 hope is that warring labor
organizations will get together. He
makes it clear that the Maritime Com
mission will play ball with any stable
labor organization.
Another serious maritime problem
is replacement of a fleet that is “ob
solescent to obsolete," Admiral Land
says. The high spots in the Merchant
Marine Act of 1936 are. he thinks. (1)
construction subsidies that put Ameri
can ship builders on a parity with
foreign, (2> operating differential
subsidies, that put American ship
operations on a level with foreign.
tignteen years ego it was different.
The United States had some 2.500
merchant ships for overseas trade,
built and acquired during the war.
‘ Now, given fast and modem ships,
placed on anywhere near parity with
foreign shipping,” as Admiral Land
says, "our merchant marine can hold
its own.” American ships carry' 35
per cent of our foreign commerce, as
compared with 10 per cent in 1914,
before the Great War
Replacement requirements in both
domestic and foreign trade are enor
mous. The total seagoing fleet com
prises 1.422 vessels of 2.000 tons plus,
and of these 1,305 will be 20 years
old or more by 1942. The commission
has been staggered. Admiral Land
says, by costly bids for construction.
The new chairman (succeeding
| “Joe" Kennedy, now Ambassador to
i the Court of St. James) is the right
j man in the right place, when it comes
| to directing the policy of ship con
! struction. He headed the Navy's
Bureau of Construction and Repair,
and was decorated for his work dur
ing the war Born in Canon City,
Colo., appointed to the Naval Academy
from Wyoming, 1898. the years have
; left Admiral Land trim-rigged, four
square as to shoulders, a deflni'e
, sense of humor, some greying hair,
sailor's blue eyes and an ability to
catch any breeze with a minimum of
sail. It is expected that his helm?
manship will steer the merchant
marine into safe harbors.
Cocktails can be mixed In near:
4,000 different ways, says a London ex
pert.
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