Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-12-14
FALSE HOPES SEEN
IN FARMER A|DLAW
Government Executives Think
Little Relief Can Be Ex-
pected From Measure.
BY DAVID LAWRENCE.


Congress would raise false hopes by
the passage Of resolutions promising
financial relief to the farmers. in the
opinion Of officials in the executive
has just passed resolution directing
the Secretary Of the Treasury to re-
vive the War Finance Corporation and
expressing to the Federal Reserve
Board the opinion that, liberal credits
should be extended the. farmers of the
country.
This action ot the Senate p.obabIy
In the House, and then Congress will
have diecharged its obligation to the
farmers Who have been cfamoring Tor
help As prices declined.
But the truth -, t1les ue1utioa VIII
be practically ignored 4A1 viii not aid
the situation. and the farmer. who re-
lies on it is apt to be in q worse situa-
ton than the one who doesn't.
|. Investigation at the executive end
of the government reveals the fact,
for instance, that G6v. Harding of
the Federal Reserve Board will stand
pat and wilt not regard the opinion
expressed in the Senate resolution. as
"
thing done it, must direct the, Federal
Reserve Board to do it by amending
the federal reserve act. And if it does
that it would not be surprising to see
the Federal Reserve Board go to
pieces altogether by the prompt res
ignations Of several of it's members.
Either the Federal Reserve Board will
act for the best interests of the coun-
try according to it's best banking
Judgment or the federal reserve sys-
tenn will become the foot ball Of con-
gressional politics.
That is the critical view of the Sit
uation as it has developed in execu-
tive quarters in the last few days.
Some inkling of the seriousness with
which members Of the federal reserve
board regarded the invasion of their
prerogatives reached the Senate yes
terday for the proposal to limit the
discount rate to per cent was voted
down after 1t was learned what a
mischievous effect the action might
have had on the entire banking sit
uation.
Has Not Changed His Mind.
So far as the federal reserve board
is concerned, the teeth were taken out
of the resolution when the proposal
was changed from a direction" to
the expression of an opinion. Gov.
Harding has indicated in his testi-
mony before Congress exactly how
he views the proposal to extend fur
tter credits to the agricultural inter-
ests and the action of the Senate has
not changed his mind.
Mr.. Harding is to be governor of
the Federal Reserve Board until
. August, 1922, and though he comes
from. the south. which has been in
sistent that cotton growers be pro-
tected by the extension of credits. he
is acting independently of any polit-
ical influence in the matter.
The fact that Senator Carter Glass
Of Virginia. democrat, and former
Senator George Mclean, republican.
chairma nof the Senate committee on
banking and currency, vigorously op-
posed the action of the Senate is
proof of the non-partisan character
OF the opposition to the Gronna- Norris
proposal.
Oficials fear that for a day or two
the market might hold up as relief
is promised by Congress. but that
when those who are holding their
goods finally find out that they can't
expect financial aid the bottom will
drop still further and the revulsion of
feeling will be even greater against
those who raised false hopes.
Veto May BE Interposed.
AS IOr the secretary OF tne treasury
and the war Finance Corporation, the
direction of Congress that it be re-
yived will be needed If the resolution
passes both houses. There is, of
course, a chance that a presidential
veto may be interposed as Mr. Hous-
toms word with President Wilson is
very potent. However, even IL the
resolution should become law over a
yeta, the chance for relief is still de-
pendent upon the personnel Of the
war Finance Corporation. the MEM
bers OF which are selected by the
President. There are four members
Of the board besides the Secretary Of
the Treasury, and at present there
are two vacancies.
Supposing Mr.. Wilson appointed two
democrats. would the Senate confirm
them for four-year terms. or would
the Senate feel that Warren G. Hard
ing ought to have the chance to name
these new members? Delay would, of
course, nu1lify the purpose Of the
resolution, as It seems to be the uni
versal opinion in executive quarters
that the present emergency will come
to an end after the New Year.
Moreover. the regulations OF the
War Finance Corporation are made