The Bismarck Tribune Newspaper, October 6, 1937, Page 7

Economist Flynn Warns Against Accepting ‘Recovery’ at Its Face Value i ebeie E By JOHN T. FLYNN (Copyright, 1937, NEA Service, Inc.) We have now seen that the govern- ment has paid out billions of dollars in recovery and relief expenditures to millions of people who are customers of our business men and that all of these billions have thus promptly mad® their way into business. We haye seen also that the government hes obtained all of these billions by bor- rowing them at the banks. Now we can see what the effects of this have been. First, it is perfectly obvious that this hes produced a powerful lift in business. Men have gone back to work and they in turn, drawing wages, spend those wages with the merchants. And the profits of business have re- ‘turned. Second, certain psychological results have taken place. One is that the great majority of people accept this ai! at its face value and say flatly that we have recovered. This creates con- Beene in Gea e maimas ends eve in 8 spending mood. Next, a large number of more ob- people have concluded that, this immense infusion of government credit is the prelude to a considerable inflation. They believe that the forces making for inflation once set in motion are too powerful to be easily or qucik- ly checked. If inflation comes they ‘believe, rightly, that prices will go up, The President's monéy policies have the same effect. The Presi- dent has devalued the dollar, cutting down its gold content by 40 per cent.| up Many economists and many investors The stock exchange reflects fluctuating attitudes of the country about the business outlook in believe this is an inevitable force pressing toward inflation. It has re- sulted in the influx of FIVE BILLION DOLLARS in gold, another energy working for inflation. Then there was, beginning in Mii tember, 1936, a very influentyal achool of financiers and economists who de- cided that the spending program, plus the governments résolution to avoid taxing as much as possible, plus the government's borrowing policies bleaery that we were about to see a tremend- ous expansion of the heavy construc- tion industries. 3, That great shortages have paltry in houses, commercial Plant machinery, railroad Piermeag | Nation to Get Jobless Quiz Blanks Nov. 16 5 Bet. 6.—(P)— ane unemployment cénsus q 3 were «made public | auriee pee hyttgielicagiprtli irre of the other is this state- ent ii President Rooeevelts flavor 4ecause its toasted Because eqch drop is alwaye mild ead mellow... 1v’e two years old, It’s “age-con-rolied,”” You'll aay, “OLD QUAK-ER'S Rowult-—todey meére than ever before," are seeking “If you ate unemployed or y unemployed and are able to work and work, please fill out this repert card right away and mail it S EPILEPSY INHERITED? CAN IT BE CURED? opinions ef to any rede?. writing to the Faucatisual Division, 551 Fifth vane, ow York, N. ¥., Dept. o_ 55. United States. THE BISMARCK TRIBUNE, WEDNESDAY, OCTOBER 6, 1937 ‘Spectre of Taxation to Finance PU nasouiabl Spending Brakes Boom terms of securities prices. utility facilities and that these would sufely result in taking advantage of the easy money market and the rising tide of business to make large security offerings and embark on extensive building programs. Altogether, they concluded we were on the eve of the greatest boom in history. And they sold this idea to a very large number of investors up to the beginning of the summer. As a result of all this, in spite of war rumors in Asis and Europe and despite widespread labor troubles, the stock market went up. And at the Same time the prices of commodities and retail merchandise went up. * * * Facts Begin to Sink In And so as this year opened the seene seemed set to the multitude for & grand sweep forward. Now then, »| what has actually happened? Business has gone forward. The steady flow of new purchasing power has continually expanded purchasing power. Then for the first time since the depression private lending began to show its head. The banks increased leans a billion. And private building, chiefly housing, increased. It is not true to say that business did pot go forward. It went forward about as any sane observer predicted last Jan- uary. But the big point is that it did not go forward with the great bounce which the overwrought optin- ists supposed. And as the oragred months opened this fact began to arn on a lot of minds. ‘The dawning was produced by sev- eral factors: (1) The great boom didn’t show up. And building, which improved, ceased its improvement at the very moment when it should have surged on, (2) As @ result of discussions thé country suddenly became conscious of the means by which it had recovered. In other words, the government bor- rowing program came to be more generally understood. The warnings of economists and others for several years began to sink in. (3) It has also suddenly been driv- en into the minds of business men that this vast flood of credit, which Grove business forward, is now @ bur- den. It was credit. It is now debt. It must be stopped, they say. But it we stop it, what then? What will take its place? If we stop using I, O. U.’s we must use cash, That means taxes. Of course they would like to see spending stopped. But it can’t be Just stopped overnight. We have created a machine which must be kept running and if dismantied at all, must be dismantled slowly. More- over we have driven the whole eco- nomic life of the country to a much higher price level. We have to kéep ii there. And behind all this looms the ominous word—TAXES. * * % Question of Taxes Demands Action Thus the mind of the country stood and thus the price structure of goods and stocks stood. Had there been no European or Asiatic scare this must have brought about a stock market decline soon anyway. Stocks went down because they went up too fast and they went up on a series of false asumptions. They will probably go up again a little more slowly and then topple again. But in the meantime, is it not quite plain that the nation must now settle down a little soberly and meet these grave questions of taxes and national credit before they go so far that dealing with them will be impossible? THE END before midnight, Saturday, November 20, 1987. No postage stamp js needed.’ The cards will be distributed by letter carriers on November 16 and 17 to the nation’s 31,000,000 families. Where there is more than one job- less person in a family, postmen wil) leave extra cards. Windsors Can’t Leave Paris Before Oct. 27 Paris, Oct. 6—(P)—A close friend of the Duke and Duchess of Windsor said Wednesday the couple planned to leave for Germany Sunday on the first stage of the survey of labor; problems which will take them to the Specific plans for the American have not been arranged. The duke has accepted engagements for up to Oct. 37 in Paris. AMAZINGLY SMOOTH | AT 2 YEARS | Dunk | Investment House Head Dies in Fall New York, Oct. 6—(%)—Walter 8. Case, president of Case Pomeroy & Co., well known Wall Street Invest- ment company, died in a fell from the window of the firm’s offices on the 26th floor. Henry R. Johnston, vice president of the company, said Case's associates were sure his death was accidental. pa pe “Look, mom, that's where papa’s havin COPR. 1987 BY NEA SERVICE, INC. my bicycle fixed.” | objective of the Insurgents on the Privacy-Loving Lindy Lives on in England Londen, Oct. 6.—(?)—The Lind- berghs have decided to spend an- other Christmas in the rambling, ancient, timbered house of Long Barn at Seven Oaks, Kent, the landlord revealed Tuesday. Long Barn’s owner, Harold G. Nicolson, member of the house of commons, said Col, Lindbergh gave notice that he intended to Tabn “until after Christmas at least.” A friend once said, “If Lind- bergh cracks his head a few times on the low doorways, he'll decide to move,” Whether or not the lank flyer cracked his head, he seems satis- fied with the picturesque retreat. Even the landlord, who resides at Sissinghurst Castle, Kent, said he could not understand why ee colonel is content to stay T atl any oa N. D. Royalty Box 3¢7 Mandan, N. D. Bergeson’S 28th Anniversary SA LE 200 Regular $1.75, $2.00, $2.25 Shirts Priced for This Sale at "1% 3 for $4.25 Top Coats the required oo OLD QUAKER ane nee) we've methods. ‘hese's A Barre! Of Sener nti omatinanace 3. rou fe or email ones richer with this richer CLD 4 Soames. IfiveccD QUAKER’ OK. SPGRED GY TLASERATURS CONTROUED WARRMOUEES Cope. 1937 = THE OLD QUAKER CO.— LAWRENCEBURG, INDIANA Specially Priced at $ 1 g50 - $2250 Overcoats -- Suits Warm, comfortable prereeat, Bs Bg finished worsted suits at these redt $2250 | $2695 $31 Bergeson’S HASSELSTROM Bismarck, N. D. drafty Long Barn during the winter. Friends of the Lindberghs said the couple is completely satisfied with Long Barn as a suitable place for the rearing of their sec- ond son, Jon, so it is thought Mkely they will continue there until the third son, Land Morrow, passes through infancy. Their précautions for privacy— Tegarded as remarkable by the English neighbors—still are main- tained and the whereabouts of Lindbergh at the present time are Hunger-St Inmates Get Hungry| Joliet, T1., Oct. 6.—(#)—Appetites were winning over antipathies in Stateville penitentiary Wednesday and Warden Joseph E. Ragen indicated he may soon unlock the cell doors con- fining 3,000 hunger striking prisoners. Ragen said only 300 refused break- fast. This was 150 fewer than spurned | Cinner Tuesday night. He said there would be “no bar- gaining” with the convicts, who started thelr strike Monday in protest of tightened parole board regulations. Insurgents Press Slowly on Gijon (By the Associated Press) Asturian troops maneuvered into! stronger positions Wednesday to pro- | tect Gijon while their outposts sniped at the slowly advancing Spanish In- surgent foe, A Spanish government communique said defense militia occupied peaks dominating a road to Cangas de Onis, enabling them to shield the town of Sella river fortifications, immediate ALL YOU DO Is THIS... NOT THIS... WITH } NATURAL GAS! Installed by: MONTANA-DAKOTA UTILITIES CO. FRENCH & WELCH GERLACH SHEET METAL WORKS HARDING METAL WORKS MONTGOMERY WARD H. A. THOMPSON & SONS stret desrve the army of all political authority, silencing high army officers and stopping all mili- tary parades and ceremonies. The halibut is capable of changing its color’to match its surroundings. _— EE 200 fine shirts on sale af $1. 50 each, 3 for $4.25. Berge- son’s 28th Anniversary Sale. 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