The Washington herald., 1920-12-18
Leaders May Ask for Spe.
cial Rule to Get Reso-
luton By.
OPPONENTS PREDICT
VETO BY PRESIDENT
Chairman of Currency
Committee to Appear
Against Measure.

Ine pdSSh6c ny the muse tOudy
of the resolution directing the Sec
retary of the Treasury to revive
the activities of the War Finance
Corporation appeared likely last
night, unless representatives of the
large Industrial centers. of the East
forego trips home for the week end.
The measure has already been
adopted by the Senate in a vive
voce vote and been reported favor
ably to the House by the Banking
and Currency Committee.
The plan of Republican leaders
is to hold hearing before the
House Rules Committee this morn
ing and in the event of favorable
action to attempt to have the House
adopt the rule for the considera-
tion of the resolution this after
noon. The measure has received
support chiefly from Representa-
States where agricultural industry
predominates. 1t has been vigor-
ously opposed by Representatives
of industrial sections and by the
administration.
4 growing opposition to the pro-
posal in support of the position of
David F. Houston, Secretary of the
Treasury. by leading Republicans
has become increasingly manifest.
The alignment on the measure was
apparently on sectional and not on
party lines.
l. Louis T. McFadden of Pennsylvan-
ia, chairman of the House Banking
and Currency Committee, announced
he would oppose the measure. In
consequence the majority report of
the committee was prepared by
James G. Strong of Kansas. Re-
publican. The minority report was
also prepared by a Republican, Rob-
ert Luce of Massachusetts,.
Wilson May Veto. ~
The belief also prevails that Pres
idsnt Wilson will veto the resolu-
tion in as far as the Secretary of
the Treasury has consistently ad-
vised against it. The view of those
favoring the measure is that it will
keep up the price of farm products
by facilitating export trade and
thus enable the farmer to get cost
of production"
Mr.. McFadden declared his oppo-
sition to the measure on the
grounds that il was class legisla-
tion and that it required the with
drawal from the public treasury at
this time of $3.50. 100000. He pointed
out that the Secretary of the Treas
ury had discontinued the operation
of the War Finance Corporation as
an unnecessary and dangerous
government function under present
known conditions.
"Inasmuch as it increases the debt
of the United States it postpones
the lowering of the excess profits
tax and other Objectionable taxes
which means a continuation of the
already existing burden" said Nc
Fadden.
These securities, when issued by
the War Finance Corporation, will
carry with them special tax exempt
ing provisions. thus permitting a
continuation of investment in tax
exempt securities of large funds
in the hands of those most able TO
pay taxes and the very class the
country must look to for the re-
Punishment of its capital account.
McFadden Sees Conflict.
There is being organized at the
present time a s1O0,oO0.000 corpora
ton. under the Edge law. This cor
poration can expand by issuing its
bonds or debentures up to S1.Ooo,-
100000. Its securities are not tax
exempt.
1T seems to me that here is a
direct conflict between a govern
ment institution selling tax-exempt
securities, with all the advantages
that go with a government institu-
ton, in competition with a privately
owned corporation whose securities
are not tax exempt and which must
look to the same sources for the
sale of its securities as does the
government. 1t would place this
privately owned corporation at a
tremendous disadvantage because
these two corporations will be
financing the same class of busi-
ness"
Mr.. McFadden will appear before
the House Rules Committee today,
when a proposal for a special rule
will be under consideration.