New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1920-07-04
Nh. McAdoo's Fitness

Mr.. McAdoos Fitness
Two matters of consequence were
intrusted to Mr.. McAdoo while he
was a member Of his father-in-law's
Cabinet. One was the war financing.
The other was practically auto
cratic control of the railroads.
How did Mr.. McAdoo meet his
double responsibilities? Was he
equal to his tasks? Did he measure
up? The answers which must be
returned to these questions furnish
an index of Mr.. McAdoo's compe-
tency for the Presidency.
As to the McAdoo financial policy
there is increasing agreement that
It was fundamentally bad. It was
necessary to raise large amount of
money. Two differing methods Of
fered themselves. One was a diff
fcult one, the unpopular method of
pay-as-you-go, which involved heavy
taxes. The other was the easy and
more popular method of borrowing.
Great Britain had adopted the rule
that for every pound borrowed a
pound should be raised by taxation.
Our Treasury Department, under
Mr.. McAdoo, did not initiate the
British example. He minimized
leves on abnormal war profits. He
let the profit makers off and shifted
the burden to the genera. public,
most Of whose members mot only
gained no extra profits from the
war but suffered actual losses. Now
there is much complaint because
some are richer because of the war,
while others are poorer. The seeds
Of this ugly injustice were planted
by the Treasury Department.
In another vital respect the Nc
Adoo policy has rroved costly and
disturbing. 1t meant, Of course,
credit and money intlation-and in
tlation, under unacceptable laws, leads
to a rise Of prices The high cost
Of living, the Embellishments Of
business and the labor troubles
which afflict the country are largely
traceable to McAdoo initiation. If
We had had an adequate financial
minister rent would be lower and
food and clothes cheaper.
Mr.. McAdoo was many times
warned Of the certain consequences
of imitation. But he lacked the cour-
age to do the sound thing. 1t was
easier to borrow. Not only did he
bring out loans in rapid succession,
but to get them to float he adopted
an evil device. A subscriber re-
celved his bond at one bank window
and at another deposited his bond
as collateral for a note for 80 per
cent Of the purchase price. The
word went around: "You don't need
To- have money to buy bonds"
Then, the interest paid being below
the market rate for money, the bonds
toppled when applications were made
to renew loans on the bonds and the
bond buyers discovered that on re-
newals they must pay or 67a pei
cent interest. The injustice was
grave. The bond buyers, both those
who have held and those who have
sold, do not have pleasant thoughts
concerning the Presidents son-in
law.
What happened to the railroads un.
oer McAdoo management scarcely
needs retelling. The results were
such that Mr.. McAdoo fled from fur
sher responsibility. Again the weak
ness was not so much lack of in
formation as a liking for the easy
ara the supposedly popular. The
Director General good-humoredly
marked up wages, something nat
arally pleasing to employees, bu
shrank from correspondingly mark
ing up rates, something NATURAL.
oispleasing to shippers. The rail
roads were starved; but, even SO
There was a billion or so defici
which was landed on Uncle Sam
1nen the railroads, lean and ENACT
aoed and incapable of good service
were bundled back to their owners.
In his private activities Mr.. Nc
Adoo has been a promoter. Lik
osner promoters, he likes to b
pleasant and plausible. He keep
away from the disagreeable. In pri
-vate life these are amiable qualities
Dut sitter stuff is needed when i'm
portant decisions are to be made
Ins advice Of the Cohan song, al
vays to leave them laughing whel
you 90, ID good for a salesman, bu