Evening Star Newspaper, May 24, 1932, Page 10

A—10 wxwx LIEF DELAY LAID T0 OPTIMISH! WAVE Pittman, Forum Speaker, De-!| clares Mistaken Forecasts Obscured Warnings. Delay by Congress on depression Te- Mef last night was ascribed in a radio address by Senator Pittman, Democrat, of Nevada, to “the mistaken optimistic predictions of those in high nuthol’llx in Government, industry and finance. Speaking in the National Radio Forum, arranged by The Star and broadcast over a coast-to-coast network of the National Brmd(;:it\ng Co., the peaker declared that while some warn- :ngs of impending disaster were issued, “they were submerged and obscured in the great wave of optimistic declara- tions.” Senator Pittman outlined the meas- ures that have already been adopted to cope with the economic crisis, including the employment stabilization act, spon- sored by Senator Wagner, Democrat, of New York: the Reconstruction Finance Corporation act. and the Glass-Steagall banking act. and discussed pending re- llef measures. Says Act Must Be Broadened. The Reconstruction Finance Corpora- tion act must be broadened, he said, “if it is to serve the purpose of stimulating industry generally and employment throughout the country.” He added that both this legislation and the Glass- Steagall act, “while accomplishing some good, have in a sense been failures. Commodity prices have continued to fall and unemployment to increase.” “Congress will violate its duty,” Sen- ator Pittman said in summing up, if it adjourns without acting on the emer- gency legislation before it, “and doing everything in its power to bring order out of chaos, not only in our own coun- try but throughout the world.” Few Relief Bills Enacted. Senator Pittman's address follows: “T appreciate this opportunity through the courtesy of The Washingion Star and the National Broadcasting Co. to briefly outline present emergency laws enacted for relief from depression and the proposals for future legislation. It will not take long to discuss existing legislation, as only & few bills have been enacted looking to such rellef. “I do not wish to be understood as speaking in a critical vein. This de- pression is unique in our history. Our other periodical depressions have been more or less local in their nature, limi- ted to countries or tions. and duz to such definite causes that they could be easily understood and expeditiously remedied. This astounding and dev- astating depression is world-wide in its scope and effect. Strange to say our country, the richest in gold, natural resources, intelligence, industry and efli- ciency. is probably the greatest sufferer. “While this depression has buried us with the speed of an avalanche, it has come upon us with' the silence and surprise of death. Few of the great minds of the world anticipated it. But a little over two years ago the world was enjoying the greatest prosperity and our country was leading in this great advance. Today our factories are perating upon from 20 to 30 per cent f their normal capacity. The products f our farms and our mines are gener- iy selling below the cost of production. ur export trade has almost reached he vanishing point, surpluses have iled up and our dumestic market has ecreased approximately 40 per cent :Yum eight to ten millions of indus- icus, able, intelligent and willing men nd women are unemployed, walking i'hf‘ streets of cur cities and the roads f our country, seeking labor from ch to earn sufficient to feed and ciothe themselves and their families. It is conclusively evident that we sre faced with the gravest emergen history. We met the emergency World War fearlessly and unselfish- dv. We taxed ourselves without limit nd we did those things that had to be sne without complaint. We can and hould do the same things now. Some Warnings Issued. “Is there any statesman or economist | vho dares assert that two and one-half | ears »go he visualized this appalling ndition? If so. I do not know of im. On the contrary, the citizens of his country and the representatives | government were lulled into dor- ancy and inaction through the mis- ken optimistic predictions cf those in igh authority in government, industry nd finance. There were some, how- gver. who partially visualized the im-| pending disaster. “Some warnings were issued. but they were submerged and obscured in the great wave of optimistic declarations The American Federation of Labor I Eu‘nll}' called attention to the st crease in unemployvment. These rnings, however, were neutralized by controversial statements from the De- artment of Labor. Captains of indus- v continued, through the months of epression, to predict that the turning int would scon be reached. It was hese things that excuse inaction by ongress for so long a time. “There were statesmen, however, who Wisualized the trend toward depression. JAs far back as February 15, 1928, Sen- mior Wagner of New York introduced 4n the Seventieth Congress Senate reso- ution 147 to investiagte the extent of nemployment in the United States and provide methods for collecting sta- istics thereof. Even then unemploy- nent had commenced, although the ®tock market was still booming. “Again, on April 20, 1928, Senator agner introduced Senate bill 4157 for | he establishment of a national employ- nent system and for co-operation with he States in the promotion of such sys- em and to regulate the expenditure of oneys to be appropriated for such pur- ses. Again Senator Wagner, on May , 1928, introduced Senate bill 4307 to rovide for the emergency construction f certain public works for the relief of nemployment during the periods of usiness depression. All of these meas- res, except the lest, that I have named et such overpowering opposition that was impossible to enact them. “However, in the Seventy-first Con- gress Senator Wagner was successful in Ppassing through Congress Senate biil [ entitled, ‘An act to provide for ghe advance planning and regulated ronstruction of public works, for the stabilization of industry, and for aiding 3n the prevention of unemployment during periods of business depression.’ his act is known as the ‘employment bilization act of 1931 It was ap- proved and be®xe a law on February | 0. 1931. This was the first relief act 0 become & law. ‘At _the beginning of this session of e 25/Cut, MOUND TRIP BUS FARES 10 most —G I Liberal ua;;:"v':s'f m;?zé':'cy-gfién. St. Louis one way $20.00 Portland, Me... 10.00 San Francisco N‘%- York, 5.30 — Montreal. 15.30, |Write or phone 1¥rito or phone NATIONAL 1721 of GREAT EASTERN TERMINAL /1349 ‘E’ ST., N.W. (Cor. Pennsylvania & 14th St.) THE NG EVENIN STAR, WASHINGT( Talks on Relief SENATOR PITTMAN. Congress Senator Costigan of Colorado introduced a bill calling for an appro- priation of $375,000,000 to be expended | by the Federal Government in aid of the destitute throughout the United States. The bill was subsequently known as the ‘Costigan-La Follette bill’ Some of the friends of the proposed legisla- tion objected to it being administered by a Federal bureau. Without the sup- port of these friends there were not sufficient votes to pass the bill. A sub stitute was, therefore, offered by Sena- tors Bulkley, Walsh and Wagne! V- ing all of the original provisions ot the Costigan-La Follette bill, but trans- ferring the administration of the act to the States and local charity institu- | tions. While a majority of the Senate favored the purpose of the act, their forces were divided and the opposition Senators defeated both the substitute and the Costigan-La Follette bill “A compromise bill was then drafted, which recefved the approval of the Committee on Manufactures, of which Senator LaFollette is chairman, and was reported to the Senate. This bill carries an appropriation of $375,000.- 000 for the relief of the destitute and $375.000.000 for Federal aid road work. 1t also provides that part of such money may be used in cities, towns and other municipalities in the construction of streets, alleys, bridges and aqueducts. ! No action has been taken on this bill because Congress has had all of fits time taken up with revenue, banking and appropriation bills “The Reconstruction Finance Corpora- tion act was proposed by the President. The corporation was to be organized and function along the lines of the old War Finance Corporaticn, but with larger and broader authority. This was in 1o sense a partisan measure. It was passed practically unanimously by Con- gress. By reason of its limited authority and its administration it has been used chiefly to aid in sustaining the credit of banks and railroad corporations. Its authority must be greatly enlarged if it is to serve the purpose of stimulaiing industry generally and employment throughout the country. “The Glass-Steagall banking act was largely the conception of its sponsors. It was intended to increase the securi- ties in banks that might be utilized through rediscount with the FPederal Reserve banks for the issuance of ad- ditional currency. The banks, at the time of the passage of the act, accord- ing to Senator Glass. even then had approximately $5.000.000.000 in securi- ties eligible for such rediscount. The banks seemed to fear to use these securities and so Senator Glass proposed that certain bonds held by the banks might also be added to the eligible securities and so they were. The act has not served the high purpose in- tended by its authors and by Congress. The banks have failed and refused to avail themselves of the opportunity of obtaining and circulating the additional | currency. This is due to fear. They fear to borrow additional currency from the Federal Reserve banks and lend it to industry because most industry is suffcring. a deficit rather than earning a profit. Industry will not borrow money when it cannot make a profit on such money above the interest that it pays for it. Confidence Apparently Lacking. “The President, in his public state- ment on May 13, said that ‘There is no dearth of capital, and on the other hand there is a real demand for capital for productive purposes that have been held in abeyance.’ “Our citizens wonder why, in such case, do the banks require Government | aid: why the banks do not lend money to such industries? The country was told that the passage of the Recon-| struction Finance Corporation act and ! the Glass-Steagall banking act would restore confidence. These acts have evidently failed to restore confidence, for we still hear the cry that we must restore confidence. According to the President the banks have ample cap- ital and there are safe industries that seek this capital “It is therefore difficult to understand why there should be a lack of confi- dence on the part of the banks. It is not so difficult, however, to understand why there is a lack of confidence on the pait of the unemployed, the farmer whose product sells for less than 1t costs to produce it, and the manufac- turer who can find but few to purchase his goods. “In view of the foregoing statement of the President many believe that the doubt as to the economic stability of our Government, and the lack of confi- dence in the safety of our Government securities, 1s due in a large measure to the fear and hysteria of capital and its constant dire predictions of disaster. “There is no investment in the world as safe as the bonds and securities of our Government, and our people should know that. It is the patriotic duty of those controlling the enormous capital of this country to reassert their confi- dence in our Government and its ability to finance the development of Federal vrojects and to pay all obligations that it may incur. “So the Reconstruction Finance Cor- poration act and the Glass-Steagall banking act, while accomplishing some good, have in a sense been failures Commodity prices have continued to fall and unemployment to increase.” or Robinson, the Democratic leader of the Senate. on May 11, in an address in the United States Senate, set forth a program for relief. It embraced the enactment of the last Wagner re- lief bill, which I have described. and also advances by the Reconstruction Finance Corporation in aid of what he termed sell-liquidating projects such as bridges, tunnels, docks, viaducts, water- works and similar projects devoted to public use when such projects, through tolls, rents, lease or royalties, will insure the return of the money advanced. The President immediately called Senator Robinson into conference. On May 13 the President gave out a statement on the subject the authority and power of the Recon- struction Finance Corporation for the purpose of aiding through loans “eco- nomicaily sound and self-supporting projects of a_constructive replacement character.” His statement was con- strued to include such self-liquidating projects as Senator Robinson designated in his speech. The President also ap- proved of advances by the Federal Gov- ernment, through the Reconstruction Finance Corporation, to the States of from $250,000.000 to $300,000.000, upon approved security, for the purpose of aiding in the relief of the destitute. He opposed further Federal aid for what he termed “unproductive public works.” Five Named to Draft Bill. “A subcommittee of the Democratic Policy and Steering Committecs, com- posed of Senators Wagner, Walsh, Pitt- man, Bulkley and Robinson, was ap- pointed to draft a bill for the relief of industry, agriculture and labor. This committee on May 21 issued a state- ment setting forth the proposed pro- gram of legislation. The program pro- vides for $300.000.000 to be advanced to the States in proportion to popula- tion for the relief of destitution upon demand of the Governor seek- ing such relief and his certification that it is needed, such advances to be deducted from future grants to the | State under the Federal aid highway act. This is in accord with the Wag- ner bill, approved by the Committee on Manufactures and now on the calendar of the Senate. “Additional authority is to be granted to the Reconstruction Finance Corpo- ration so that it may advance not to is the time luid The Fastest Selling Oil Burner in Washington SOLD UNDER AN UNCONDITIONAL 'GUARANTEE SPECIAL SPRING TERMS L. P. STEUART & BRO. 138 Twelfth St. N.E. LIncoln 6200 “COMPLETE HEATING SERVICE” Serving the Washington Public With Fusl for to install a €a He approved of adding to| exceed l},m.ooo.ooo for the following purposes: “(A) Construction of revenue-pro- ducing projects initiated by States, municipalities and public corporations. (B) Housing and slum clearance projects undertaken by limited dividend corporations. *(C) Construction by private corpo- rations of self-liquidating bridges, tun- nels, docks, viaducts, waterworks and similar projects devoted to the public use. Under this proposal no loans shall be made to any financial institution, corporation, railroad or other associ- ation or organization of a class to which loans may be made now under the Re- construction Finance Corporation act. “(D) $40,000,000 to facilitate the financing of agricultural exports. Gov- | ernment works are also taken care of in the program. The report says: * ‘Provision to be made for construc- tion of $500,000,000 worth of previously authorized Federal works and for the financing of such construction by means of a 25-year bond issue and sinking fund, the bonds to be issued as needed to pay for the works as they Pr% he Federal e leral projects to be selec must stand lhelep l[’xclflc tests. e “‘(A) They have heretofore been in- vestigated and authorized by Congress M.t,rf the approval of the President. (B) The necessary plans for their construction are in readiness or in “(C) are needed for the proper conduct of the Government business. “‘Most of the works can be com- menced at once. All of the works can be put under way within a few months. All have been carefully chosen with ?ne:n’:‘w to giving maximum employ- Boulder Dam Appropriation. “There are some items in the budget and carried in the current .ppropdrfn- tion bills that are in the nature of capital investments. For instance, for the Boulder Canyon project there is carried in the Interior Department ap- | propriation bill $6,000,000. The de- | partment informs us that this amount will have to be increased by $11,000,000 | in the forthcoming deficiency appro- | priation bill. This project should not | be included in the current Government | expenditures. It is a self-liquidating | project. The future hydro-electric | Dower t0 be generated has all been | sold in advance to solvent contractees | for & sufficient sum to repay the Gov-| crument_expenditure, With interest ut 4 per cent, in & period of 30 years. A separate fund has even been created for this project. “Such ~ proposed expenditure and similar expenditures should be lifted | from the appropriation bills and M- | cluded in the projects to be carried on | under the foregoing proposal. This| will materially ald in balancing the| budget, which must and will be bal-| anced. It is fully realized that plati- | tudinous statements and even definite | proposals will mean nothing until con- | crete leglslation 1s submitted to Con-| gress. Therefore a bill to carry ‘out the proposed program of the subcom- | mittee is now in process of preparation and will be presented and introduced | in the Senate in a few days “It is apparent that there is a con- | flict of judgment with regard to relief legislation, yet it is fortunate that the administration and a majority of the | ticles, now on the free list, on the duti- )N, D. TUESDAY, Senate, as I believe, are in accord with regard to the major proposals for emer- gency relief. “We. must realize that there are two schools of thought in this country, and that the proponents of each are sin- cere. Ome achool of thought believes that we should spend only sufficient money to exist and thereby be enabled to reduce taxes. The proponents of this school of thought hold that the money thus relieved from taxation will go into private industry. They contend that by thus reducing expenditures they can collect sufficient in taxes to assure the payment of any debts the Government incurs and thus restore the confidence of capi‘al. They urge that ‘there is no dearth of capital, and on the other hand there is a real demand for capital for productive purposes that have been held in abeyance.’ “The other school of thought, of which I am a member, is that the steady growth in depression cannot be stopped until the market price of commodities rises above the cost of production; that such rise in commodity prices cannot take place until the demand for our products is increased through the in- crease of the purchasing power of our people; that 40 per cent of the pur- chasers in our domestic market are la- borers and those dependent upon them; that it follows therefore that labor must be employed, and, if individual in- dustry cannot afford to employ them, then the Government must employ them upon economically sound Government works until industry may assume its normal function as the employer. Viewpoints Contrasted. “The proponents of one school of thought believe that because we have nearly half of the gold of the world in our banks there is ample circulating currency. The other school of thought believes that this gold, frozen in the banks of the country, has failed to cir- culate and is not, in a true sense, cir- culating currency that may be used in trade transactions by the people of the country. One school of thought believes in maintaining the purchasing power of gold, while the other school of thought believes in depreciating to a reasonable extent the purchasing power of gold and relatively increasing the purchasing power of labor and com- modities. “I have only briefly touched on pro- posed legislation that has reached a stage where it may be interpreted Many other acts, such as the calling of an international silver conference and the purchase with silver certificates of silver produced in the United States looking to the rasing of the exchange value and purchasing power in our mar- kets o fthe money of silver-money- using countries, so that they may return to the purchase of our export goods, are under corsideration “International monetary conferences have been proposed. International tarit! conferences were urged under the| Democratic policy measure recently passed through Congress and vetoed by the President. “The House Representatives and the PFinance Committee of the United States Senate, in their desperate search for revenues, have placed certain ar- able list. It is complained that such tariff items should not be attached to & revenue bill. They have been at- MAY 24, also contended that they are protective | tariffs. It may be answered that we are any discrimination against any in- dustry. The copper industry, for in- stance, is attempting to continue the production of copfer, although it has suffered a deficit for two years and now attempting to produce copper at less than half of the average cost of the production of copper in the United States. We must not blame too se- verely citizens of States who are suffer- ing desperately for seeking emergency legislation, no matter in what form and how extraordinary it may appear. “All of these things are complex problems upon which the minds of men naturally differ. However, they must be solved. We have no right to sur- render. Congress will violate its duty, in my opinion, if it adjourns without acting upon all of these questions and doing everything in its power to bring order out of chaos, not only in our own country, but throughout the world.” . PRIZES TO FEATURE TRADE BOARD CRUISE Elaborate Ready for Memorial Day Boat Trip of Business Men. Entertainment Award of prizes and souvenirs as sur- prises to guests on the annual cruise of | the Washington Board of Trade, start- ing Saturday, will be a feature of the | event, it was announced today by John ‘T. Bardroff, chairman of the commit- tee arranging the cruise. The prizes for women making the trip are worth in | excess of the trip cost per person, ac- cording to Mr. Bardroff. An elaborate entertainment program has been arranged for the cruise, which | will be made aboard the S. S. District of Columbia, chartered by the trade body for the trip. The trip will begin ' Saturday afternoon at 3 o'clock, cruis- ing down the Potomac to Chesapeake ' Bay and Hampton Roads, returning | Tuesday morning at 7 a.m. The United States Naval Academy, | Solomon's Island and Norfolk are the only stopping places on the cruise, with | side trips being arranged at each place. Special arrangements have been made | for members of the Board of Trade and their families to be guests at the Ca- | valler Beach Club at Virginia Beach Monday. A luncheon will be served at Ocean View the same day. . Indian wampum was used as money by the early New England settlers. | Kill Every tached many times in the past. It is VALUES For Over the 30th an_d Over the Summer SUITS 3-pc. Imported. FLANNELS $2 2-pie.ce Tropical Worsteds 20 B} 2-piece Linen Suits ron$12 2-piece Palm Beach Suits 15 3-piece Shantung Silks 23 J 3-piece Linen Suits rm$15 3-piece Silk Poplin Suits *40 White Serge Trousers. . ...from $8.50 Striped Flannel Trousers. .from $7.50 Flannel Sports Coa Palm Beach Sport Coats Gabardine Sport Coats. . “Manhattan” Broadcloth Shirts $1.55 Panama Hats..... Fancy Half Hose. Pajamas .. All white Sea Island duck, white calf, black and tan trim. Summer S prt SHOES ts......from $15.00 i 31025 .from $6.00 .from S0c cees.from $1.45 ‘White Buck, all white and black or tan trim, lined golf moccasions. $7 00 Sidney West, Inc. 14th & G No Stains LEE Regular HOUSE SETTLES ALL CONTESTS FOR SEATS s | Last Two Placed at Top of Pro- gram—Disney and Coyle to Keep Plaoces. By the Associated Press. ‘The Seventy-Second House of Repre- sentatives today set out after a record for at least the last 30 years—the settling of all its election contests before the first session ends. At the top of their program lead- ers placed the two remaining contests between Wesley E. Disney, Democrat, and Charles R. O'Connor, Republican, for the first Oklahoma district seat, and between William R. Coyle, Repub- £ |11c|n, and Everett Kent, Democrat, from the 30th Pennsylvania district. House Elections Committees in both instances had recommended that the incumbents, Disney and Coyle, be al- Jowed to remain in Congress. O'Con- nor’s yequest for a recount of ballots in his district was disaliowed by the House Committee when it found that the ballots had been kept in an un- locked room nine days after the elec- tion and could have been tampered with. 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