Evening journal., 1918-02-27
WEDNESDAY, FEBRUARY 27, 1918.
THE WAR FINANCE CORPORATION.

u ILLS have been introduced simultaneously in the
~ Senate and House for the creation OF the new War
Finance Corporation The corporation is to have an
authorized capital OF 1--WE hundred million dollars all
to be subscribed by the United States Government and
to be used for the following purposes:
al To enable banks to rediscount at the Federal
Reserve Bank, notes and other obligations OF public
uthties' industrial and mercantile corporations and
firms which those banks have been carrying
~ To enable the Government in the interest Of its
Liberty Loan financing to regulate and control the in
vestment market and the current ratio of interest on
corporation securities by having the War Finance Cor
poraton make loans direct public utility Industrial
and commercial companies and firms, to enable them
70 provide funds for such extensions and additions as
may be found necessary in order that the corporations
so financed may render additional TO the Gov
eminent and the public in the prosecution Of the wa
which the money market makes almost impossible
s To assist the Government in the marketing Of lis
Liberty Bonds, by permitting the War Finance Corpora
ton to 90 into the market and buy aud sell bonds Of
the Government OF any political subdivision thereof
The argument advanced in favor Of this measure Is
urgent and present it TO the people OF Delaware
without prejudice as follows:
Governmental war financing has practically closed the
Investment market to all other financing It is imposs-
Die Tor local corporation in competition with the
Liberty Loan financing TO obtain money for any pur-
pose except at prohbtve rates OF and the ex-
cessve interest rates which borrowers have been
in recent months have by contrast made the interest
rate on Liberty Bonds look unattractiye.
It appears that over 1--WE hundred million dollars Of
public utility and other corporation Indebtedness VIII
mature in the year 1918. obvious that the refund
ing Of any such OF Indebtedness at very high
interest rates would seriously interfere with the nota-
ton this year Of Liberty Bonds
Another advantage claimed from the funding OF these
corporations through the War Finance Corporation as
proposed viii lie in the protection Of The public against
ne payment OF increased rates to public utilities and
higher prices for the product or service of the other
corporations and interest rates For Instance the pay
ron and the fuel bin together OF the average inter
urban or street railway amount 20 70 per cent of lis
total operating expenses The balance represents sup
plies and manufactured materials, the Of which is
found upon analysis TO be largely labor and fuel The
price OF fuel is fixed result Of Government regula-
ton and the cost Of factor that lies largely
beyond the control Of the railway company Were t
not for Government regulation the cost OF coal today
would undoubtedly be much higher than it is and it /
follows that the cost Of service rendered by public
utilities and Of the products Of manufacturing concerns
would necessarily be higher to reimburse them for the
Increased cost Of fuel
the interest charges Of these corporations are ma
eraly Increased or IT, by the existing financial
oondltions corporations find impossible TO extend or
pay their debts and consequently forced into re-
oeNersnlps win all the attendant tremendous costs and
expenses or II the facilities Of these CORPORATIONS ara
overburdened and inadequate and money for their relief
De not forthcoming, the public will have to pay
Boiled down. the financing OF these corporations
through the War Finance Corporation viii save the
Government money by keeping down the interest rate on
It's Liberty Bonds and will save tie public money
through keeping down the interest charge on the public
Utilities and other corporations serving the public
The Federal Reserve Board has made it much easier
or the merchant and manufacturer obtain necessary
redt. West and South longer look TO New York for
uidaDce to interest rates
TI-o
ls their integrityyet controlling for eighteen months
Tier the war this vital and necessary function Of life
leas' as at present planned
The Farm Loan Board is taking care Of the farmers
pa cal needs
Prices have been fixed on steel, copper and coal while
sas Hour and oil are licensed under Government
ntrol In fixing these prices the Government has been
nh emily fair and yet has its face against pro0teern
I'd exploitation
u Congress authorizes the War Finance Corporation
e shall then also have Government agency which can
1'end financial aid to sound and essential private in