Evening Star Newspaper, November 29, 1937, Page 9

Congress Held Accountable For Slump “Rubber Stamps” to Blame for Abandoning Its Specified Powers. By DAVID LAWRENCE. NEMPLOYMENT is growing, business is declining, distress in large and small companies is increasing—and who is to blame? The tendency in the business world is to blame President Roosevelt and to call the present era “the Roose- velt depression.” But this personal- izes the problem too much. It is easy to blame one man, but in this case it does not happen to be all ; of the truth.. If the American ‘people are looking for a scapegoat— : and when times are bad they usually do— they will find the scapegoat in the ‘“rubber stamp” Con- gress—the Senators and Representa- tives who took $10,000 a year as salary and then merely asked what the White House wished done and complied. The theory of the American form of government is that the Congress- men should check the President and the Executive should check the Con- gress ‘and that the court should check them both, The Congress bestowed on the Presi- dent vast powers unheard of and un- paralleled in American democracy: The right to devalue the dollar, the right to control the credit and banking of the Nation through a board com- posed of men of his preconceived notions, the right to spend billions of dollars as he pleased in whatever projects he chose and wherever he should care to allocate them, geo- graphically, politically, economically or otherwise; the right to control the commodity markets and the stock markets through commissions of his own choosing, and the right to put into effect his labor, agricultural and economic policies through bureaus Wwith discretionary powers and subject o no legislative standards or rules ex- cept of the vaguest terminology. This is “managed economy” all right, but it is also an abandonment of the legislative function as contem- plated under the American constitu- tional system. Mandate Expired? 8o long as there was an emergency ©of a grave character in 1933, the peo- ple wanted the Executive to have Whatever power was necessary to deal With the dangers they thought con- {fronted them, but once the emergency passed the people have wanted Con- gress to become vigilant again and exercise their independence. Just as long as the recovery move- ment has been upward, there has been no tendency to curtail executive power. Now when the Executive has by his own act brought on a severe deflation, the country undoubtedly wants Con- gress to recover the powers of legis- lation. It will be said that the country gave Mr. Roosevelt mandate in 1936, but there cannot be much doubt that public funds and spending played a controlling part in that election and that the independent vote went to Mr. Roosevelt in the belief that he would be more conservative in his sec- ond term than in his first and that he would be able to continue the recov- ery movement. Today the recovery of America has been halted and a most severe and pre- cipitate decline in prices has taken place, in many respects a worse drop than in 1929 because of its suddenness and the acuteness of the damage done. Was it wise for the Congress to sit back and let Mr. Roosevelt manage the economic affairs o. the country, or was it the duty of Congress to interpose an objection and refuse, for example, to nmu?the undistributed surplus tax last year David Lawrence. Rubber Stamps. The President admits, through his Becretary of the Treasury, that deficit spending is over, which means that private spending must be stimulated. But what is Congress doing about it? Again the “rubber stamp” Congress- men are dilly-dallying. They are wait- ing for the White House to tell them The Capital Parade Chief Credit to Be Morgenthau’s If Budget Is Balanced, Observers Hold. BY JOSEPH ALSOP AND ROBERT KINTNER. 'HE 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, althmltiyh such opinions may be contradictory among themselves an directly opposed to The Star’s. HE most fascinating private spectacle ever offered by the New Deal was that of the Secretary of the Treasury of the United States playing “musical bumps” while the President applaudingly looked on, Musidal bumps is an odd and exceedingly uncomfortable game, not unlike “going to Jerusalem” without the chairs, “The players march ‘round and ‘round in a circle until some one gives the word of command, when they all sit down on the ground as hard and as fast as they can. When Secretary of the Treasury Henry Morgenthau, jr., played musical bumps at Hyde Park he made a first-class showing. He is also adept at the Virginia reels, for which the President likes to call the figures. Curlously enough, these simple pleasures have G certain im- portance as matter of state, for it is partly on them that the close Jriendship between the President and his Secretary of the Treasury is founded. The Roosevelt and Morgenthau families are old Hudson River neighbors and have long been close. It was as the President’s friend that Henry Morgenthau first came to Washington as farm credit administrator, stayed on as Undersecretary of the Treasury and finally emerged as Secretary in full bloom, * X * % Some people think that Mr, Morgenthau is not a strong Secretary of the Treasury. He is not, in the sense that he is no great financial expert, for all his early training was as a scientific farmer. But nevertheless, if the budget of the Federal Government is ever balanced by the New Deal (which, incidentally, looks more improbable every day), the chief credit or blame will be Mr. Morgenthau's. For a year or so now, he has used his combined position of close White House friend and the highest financial official of the Government to urge budget-balancing on the President. Because of a certain seriousness‘in his demeanor, the President long ago affectionately conferred on him the nick- name of “Henry the Morgue.” He might be better described as Henry the Wheedler. Since he started his budget-balancing campaign, he has never been discouraged. Presiden=~ tial inattention only caused him to redouble his prayerful efforts; presiden= tial rebuffs never sent him into those fits of sulks to which less pliant states- men are liable. Last spring it really looked as though his wheedlings would bear eventual fruit. Now, however, he seems to have got himself a little over- extended in his budget-balancing effort. Just at the time when he has committed himself publicly to promote budget balancing along comes & depression, with all its enormous and probably irresistible pressure, for a resumption of heavy Federal spending. * % * ¥ If the pressure for spending does prove irresistible, there is more than a possibility that he will have to resign. Already the same London Embassy which received a previous Secretary of the Treasury is said to be waiting for him. Already the friends of Joseph P. Kennedy, the President’s able adviser and chairman of the Maritime Commission, are hoping to see Mr. Kennedy substituted for Mr. Morgenthau, Mr. Morgenthau has remarked privately that the embassy he wants is the embassy to Fishkill, N. Y., where he has a pleasant country place built on the handsome fortune of his father, the Wilsonian Ambassador to Turkey. Actually, however, the last thing in the world he desires is to leave the Treasury at all. He loves his work. Just up the river from Fishkill is Staatsburg, the greatest of the Hudson River manors, among which Hyde Park must also be numbered. Its owner, until his untimely death, was Ogden L. Mills. As country neigh- bors sometimes will, Mr. Morgenthau had some slight jealousy of Mr. Mills and his achievements, therefore, when he succeeded to Mr. Mills’ old post, he was filled with the spirit of competition. His successful flotations of Government bond issues (to the banks, to be sure), his reorganization of the Treasury machinery, his new position as business’ budget-balancing friend— of all these Mr. Morgenthau is very proud. He also likes the pomps and perquisites of his job. Occassionally he uses the Secret Service men as “couriers,” and, at the Democratic convention in Philadelphia, & year ago last spring, he had them look over the hotel room assigned him by the Committee on Arrangements. * X ¥ x As a private person, he is genial and kindly, with strongly domestic habits. His wife, a charming and brilliantly intelligent woman, has much influence on him, and the couple are much attached to their children. In business, he is immensely careful, rather sensitive, and sometimes a little nervous. If much time passes without a call from the White House, he begins to grow worried. When he is not worrying, his only preoccupation is his work. He appears to be unshakeable in his convictions as to budget-balancing. If anything could have shaken him, it was the exceedingly rude reception * accorded his recent budget-balancing speech before the Academy of Political Science by many members of the very tory audience. After the speech was over, Herman Oliphant, the radical general counsel of the Treasury, tried to turn the tory laughter to account, but he made no headway with his persuasions. Of course, the brutal choice between leaving his job and forgetting the unbalanced state of the budget may be more effective with Mr. Morgenthau than Mr. Oliphant was. (Copyright, 1937, by the North American Newspaper Alliance, Inc.) what to do. They are forgetting that they are taking the people’'s money of $10,000 a year and certain expenses on the theory that they will function independently and not as rubber stamps. They are permitting the bu- reaucrats in the Government depart- ments and agencies to write the laws. Congress is plainly to blame, therefore, not only for bringing on the present depression, but for failing to act promptly now to get the country out of the depression in which it has been plunged by “managed economy.” ‘The people cannot, express their pro- test against Mr. Roosevelt, for he is not going to be a #andidate in 1938. The people can express their wrath, however, against “ruber-stamp” Repre- sentatives and Senators between now and next November. For there will soon be primaries in which “rubber- Select any @iano stamp” Demccrats will be up for re- nomination and there will be prim- aries in which “rubber-stamp” Repub- licans—the kind that bow to the ad- ministration when their pet projects are granted, will be up for re-election. And after the primaries have been held and the nominees have been chosen, the people will have another chance at the November elections to say “yes” or “no” to all “rubber-stamp” Representatives and maay of the Sen- ators whose terms expire in 1938. Campaigns are often waged with slo- gans, and it would not be surprising if we heard in the campaign of 1938 the cry: “Rub out the rubber stamps” in Congress. If the people manifested their feelings, it might have a health- ful effect immediately on the timid souls who still feel they must take or- ders from the boss in the White House. Anglo-U. S. Trade Pact Treaty With Britain a Boon to Peace, Private Enter- prise and Free Economy. By DOROTHY THOMPSON. F YOU believe in private enterprise, free economy and peace, you will welcome the prospect of a re- ciprocal trade treaty between the British Commonwealth and the United States as the biggest news in many weeks and the most hopeful sign for world recovery in . years, It is also the first big victory for Secretary Hull, who in our own cabinet has fought a fairly lonely fight against regimen- tation and eco- nomic national- ism, and fought it with a con- structive counter- weapon. 3 For regimenta- tion is a result, rather than a cause. It has come about all over the world, with the con- traction of world markets and the inability of nations to find outlets for their goods or to exchange their agri- cultural products or manufactured goods for essential raw materials. There is not a chance in the world of this regimentation halting, of our moving away from one form or another of planned economy, with all the po- litical connotations of that word, ex- cept in a freer world. This treaty, which the State Depart- ment is fully empowered to make, will not be concluded without many howls of protest from special interests. Tariff lobbyists have not been notable for their capacity to think as national economists, but invariably are zealous in defense of their own personal ends. Pact a Good Thing. The issue will also be beclouded by those who read into it a grandiose political scheme to unite the British Commonwealth and the United States in a “democratic front” against Fascist nations. On this ground it will be hailed by those who want such a front, and denounced by those who fear our being embroiled in entangling alli- ances. That the trade agreement, if it be- comes effective, will enormously aid the cause of democratic government in the world, this column sincerely believes. That it is directed against any one, or presupposes a democratic “bloc” is nonsense. It represents a positive trade policy on the part of those who believe in revived international trade, because they believe that revived international trade will further international stabi- lization and prosperity. It is largely the work of a man who has believed in the principles of reciprocal trade for 20 years, since before Fascism was ever thought of, and who has been work- ing for this agreement since this ad- ministration went into office in the spring of 1933—at the same time that Mr. Hitler came into power. Most Important Treaty. 1t is, of course, the most important possible trade treaty that Mr. Hull could negotiate, because the amount of potential trade involved is so large. The United States and the United Kingdom are the world’s leaders in trade. Between them they buy 28 per cent of the world's imports and sell 24 per cent of all exports.* Our exports to the United Kingdom in 1936 were equal to our combined sales to nine other European countries—France, Italy, Germany, Belgium, Holland, Denmark, Norway, Finland and Czechoslovakia. Forty-seven million Britishers bought more American goods than the billion inhabitants of Asia. And Anglo-American trade has sur- vived even under the most serious dis- couragements. Our tariff policy has dealt harshly with English goods. We buy a great many products via Eng- land, such as tin, furs, tea, rubber, etc, but the bulk of goods actually produced in England, pay rates of Dotothy Thompson. RESORTS. FLORIDA. WHITEHALL, P Beach's most _distin- uished hotel. policy as Mi: i Biltmor from 30 to 46 per cent. And some of them, which compete with no impor- tant American industries whatsoever, such as cotton lace, pay 90 per cent. ‘Tariff Brought Slump. Our own protectionism, expressed In the tariffs of 1922 and 1930, awak- ened the response of British protec- tionism. Even after the war, when protectionism was rampant all over the world, and became one of the par- ents of the depression and economic regimentation, the traditional British prejudice in favor of free trade fought for a time, stubbornly. But in 1931, when the British abandoned the gold standard and reduced the value of the pound, it began a protectionist policy, first as an emergency. But, as we our- selves learn, emergency measures tend to intrench themselves. The British protectionist policy was given perma- nence in the Ottawa agreements, con- cluded in August, 1932, which gave preference in England to empire prod- ucts and vice versa. At the Ottawa conference two opinions contended, one that the barriers to trade should be lowered between Britain and her do- minions, and the other that tariff bar- riers should be erected around the em- pire against all outsiders. Mr. Stan- ley Baldwin supported the former pol- icy, but was defeated. Ottawa Pact Hurt. The effect of the Ottawa agreements on our trade was serious. It is true that we still maintained about the same percentage in the British mar- ket, but certain things suffered disas- trously. For example, Great Britain had purchased $20.000,000 worth of American flour and wheat in 1931. She purchased only a little over a million dollars’ worth in 1935. The pur- chase of hams was cut almost in half, and that of condensed milk was al- most obliterated. Rice, other cereals, canned fish and fruit, also suffered. Tariff policies were not alone to blame. The drought played a role, and so did the crop restriction poli- cies of the A. A. A.—which, inci- dentally the new farm bill wishes to revive, just as we are about to make the biggest move to increase American farm exports of the whole administration! But the British policy of empire preference certainly hit the American wheat farmer. Canadian wheat went into Britain free; Amer- ican had to pay a 6-cent tariff. The British, I understand, are willing to go much further in mak- ing concessions now than were dreamed of several years ago. They will set aside a large part of the imperial preferences. Particularly will they give equal chances to American wheat in their market. Agricultural America will profit greatly by the proposed treaty. Important Politically. Elsewhere the problem will be to make possible substantial increases in sales of English goods in our mar- kets, and, at the same time, to avoid injury to well-conducfed American industries. This is not nearly so dif- ficult as it seems at first sight. We now levy high duties on many goods that are not manufactured in Amer- ica at all, or, if manufactured, are of a completely different quality, or are produced in small quantities, in- volving no considerable investment of capital or employment of labor. There are high duties on fine yarns, mule-spun from Egyptian cotton which do not compete directly with American yarns, which are ring- spun. We pay high duties on Eng- lish worsteds and woolens, whose quality puts them outside of Ameri- can competition. We pay a prodi- gious duty on cotton lace and on table damask and handkerchief linen, which aren’t made here at alll From a political viewpoint, the effects will certainly be important. The news This Changing World Former Tribal Leaders in Outer Mongolia Wilj Goad Russia Into War, If Japan Wills It, By CONSTANTINE BROWN. IPLOMATS and soldiers are now watching Outer Mongolia. There, they say, will occur the next Asiatic conflict with plenty of high- grade fighting. ‘When the Moscow government established its hegemony over that wilds part of Asia, a number of princes—heads of tribes—had to flee, They were not in sympathy with the Soviet government's aims and rather than lose their heads they lost their leadership over the tribes. All these men took refuge in Inmer Mongolia, Jehol and Manchukuo. The Japanese received them with open arms. They were given huts and jood and, in many instances, noney. In the Japanese scheme of complete domination of the Northern Asiatic continent, Outer Mongolia plays an imporiant role, But it is equally important to the Russians because their lines of communications with the maritime provinces can be cut off by the nation which controls that part of Mongolia. The Baikal Lake region, the key to the communication system between Eastern and Western Russia, is Vulnerable if Outer Mongolia is in the hands of a hostile country. * % ok x Ever since the Japanese be- gan their campaign in Northern China, the Soviet general staff has been sending steadily reinforce- ments to Siberia. The double-track railroad from Moscow to Vladivo- stock has been used almost ex- clusively for the purpose of carrying war material and troops frem Europe and Rissia to the Far East. These transports did not go further than Baikal whence they were sent to Oula Bator and further south. In competent quarters it is believed that as soon as the campaign against Chiang Kai-shek slows down by the occupation of Nanking, the Japanese general staff will proceed to organize the five provinces they have conquered. An armed force will be left there to assist in the organization of the provinces and some dummy Chinese governors will be appointed by ‘Tokio as the satraps of these regions. The bulk of the Japanese forces will be moved toward the Russo-Japanese borders. The Mongolian chiefs who have been dined and wined by the Jupanese government will be turned loose in Outer Mongolia and ordered to start trouble there. With a cer- tain amount of money and other methods well known to the Japanese general staff, it is likely that some rebellions will start in that region which 1s for the time being under the wings of the Soviet. * ok % % As soon as these outbreaks become noticeable, it is certain the Soviet forces will try to put them down: the Japanese will have to rush to the protection of Outer Mongolia against Communism—and the fat will be in the fire. The new war is not expected to break out before next spring. This, for two reasons—the season is too far advanced to permit military oper- ations in a country which has no roads and no other means of communi- cations except camel paths, and the Germans are not yet willing to tackle the Soviet bear. The general consensus of opinion is that this time the Japanese advance will be parallel with a German attack in Europe. The Japanese and the Germans. will pound on Russia simultaneously. In the meantime, both antagonists are getting ready for the real showdown. Two Japanese cavalry divisions and a crack infantry division have already been detached from the armies which have invaded five provinces and have been sent to strengthen the Western Manchurian border. The Russians on their side are not idle. Army engineers are building pill boxes and “Hindenburg lines” where Mongolia appears to be most vulnerable, landing fields are being prepared in the Mongolian deserts and huge underground gasoline tanks are being filled with gas for the use of the aviation and the motorized divisions. * x ¥ % State Department i3 now *“watching” developments in Shanghai. It is really a repetition of what happened five years ago in Manchuria. The Japanese are settling down in Shanghai and making themselves at home. i They will not interfere with the foreign troops. On the contrary, they are glad to have them there, they are & pawn in their hands should the Western powers decide to shake their fists under the Japanese nose. But Tokio is grabbing gradually all the economic and financial assets the Chinese used to have in Shanghai. This is the first step—the fruits of conquest. Later they will be able to push out gently, but firmly, the Western powers, until Shanghai will be a purely Japanese port. The State Depart~ ment will go on “watching.” Headline Folk They Do Bodanzky, Conductor for Met, Finds Wag- ner His Specialty. By LEMUEL F. PARTON. ONDUCTING Wagner, Artur Bodanzk~ is, in person, an- gular and dynamic, never fluid and meilifluous. He seems to have been born to conduct ‘Wagner, which Bas been his specialty in his 22 years, off and on, at the Metropolitan Opera House. His most imperative of all batons will pace, or possibly lash, Tristan and Isolde through tonight's dissonance, which somehow becomes exalted harmony, as the lorgnette batteries swing into play and jewels outblaze the flood- lights, with the season's opening at the old red plush citadel of song. It is hard to imagine a Wagnerian fuehrer with the Weltschmerz, but such is the strange dual make-up of the Met's specialist in German opera. He holds a pensive thought for the mellow old Vienna of his youth. That was a golden age. He was a gangling, freckle-faced boy, joining the tuneful free-for-all in the old Winterbierhaus, when the great Brahms gave him a cigarette. All later honors and emolu- ments were a bit shoddy after that. He treasured that cigarette until it fell apart. Supposedly, a Wagnerian would go in for power politics. But Mr. Bo- danzky is a Democrat, and believes passionately in the democratization of music. He makes no genuflections to the royal box. He would flare the great classics out among the multie tude. He has contempt for both the culturally esoteric and the ultrae commercial in the arts. Vincenf Lopez once asked Mr. Bodanzky ta give him lessons. “May I ask how much you earn?* he said. “About $100,000 a year,” replied Mr, Lopez. Mr. Bodanzky howed low. “It is I who should be taking les- sons from you,” he said. He is a ruthless autocrat when swinging the baton, but friendly, mag- netic and companionable off-shif His father, also a musician, hates Wagner. Trained in the Vienna Con- servatory of Music, he made a swift ascent to eminence on the Continent, conducting at St. Petersburg, Prague, Paris, London and Mannheim. It was in the last city that Metropolitan scouts found him, in 1915. ‘The deep and enduring aversion of his life is the lipstick. When his wife first got one, he heaved it out of the window. He’s pretty much of a hold- out in the surface glitter of the Met, but his enchanted baton can summon angels and demons from the deep. (Copyright, 1937.) Windsor Compliments Author. An American book publisher features the fact that the Duke of Windsor has written him complimenting one of his authors. made a great stir in Germany, for instance, and the process of negoti- ating the agreement will be followed there with intense interest. The principle of the reciprocal trade agreements is certainly the antithesis of the principle of the German barter system. *These figures and those following are from Mr. Percy W. Bidwell's excellent article in the October, 1937, number of Foreign Affairs. (Copyright, 1937.) INSLOW INTS U. S. Gypsum Pa Texolite & Cementico NAtional 8610 ATTRACTIVE RATES from 10 JAMAICA, HAVANA AND NASSAU'|2 DAYS ON THE LLOYD ATLANTIC LUNER :BERLIN *IJSH—P LEAVING NEW YORK . . DECEMBER 28 with a gala New Year's Eve Celebration on ship in the Carib- bean .. 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