Evening star., 1921-01-03
SENATE PASSES FINANCE
RESOLUTION OVER VETO
OF PRESIDENT WILSON
PRESLDENT;SVETO
MESSAGE IN TEXT
SENT TO SENATE

The Presidents message follows:
To the Senate of the United States:
1 am returning. without my sigma
ture. S. j. Res. 212, joint resolution
directing the War Finance Corpora
tion to take certain action for the re-
hef of the present depression in the
agricultural sections of the country
and for other purposes
The joint resolution directs the re-
ylvai of the activities of the War
Finance Corporation. This corpora
tion is governmental agency. Its
capital stock is owned entirely by the
United States. 1t was created during
hostilities for war purposes. The
proposed to revive were conferred in
March, 1919. to assist if necessary IN
the financing of exports. The general
powers of the corporation expire SIN
months after the termination OF the
war. and the special powers with re-
spect to the financing of exports ex-
pire one year after the termination
of the war. While we are technically
still in a state of war. it unqueStion-
ably was presumed, when this added
have been formally proclaimed before
this time. and that the Limitation of
one year would have expired.
'In May, 1920. in view of the fact
that export trade had not been inter-
rupted but had greatly expanded, and
that exports were being privately
financed in large volumes, the War
Finance Corporation. at the request
of the Secretary of the Treasury and
with my approval. suspended the
making of advances.
Fears False Hopes.
This resolution was passed by the
lxy in Vi nf ho
recent sudden and considerable fall in
prices. especially of agricultural COM
modities, with the thought that some
European countries to which certain
products were customarily shipped
before the war might again be en-
abled to resume their Importation, and
that larger masses of domestic ex-
ports to European countries generally
might be stimulated. with the result
ing enhancement of domestic prices.
1 am in full sympathy with every
sound proposal to promote foreign
trade along sound business lines. /
am not convinced that the method
proposed is wise, that the benefits. II
any. would Offset the evils which
would result, or that the same or
larger advantages cannot be secured
without resort to government inter-
vention. On the contrary. l appre-
hend that the resumption OF the cor
poration's activities at this time would
exert no beneficial influence on the
situation in which improvement is
sought, would raise false hopes among
the very people who would expect
most, and would be hurtful to the
natural and orderly processes OF busi-
ness and finance.
Large government credits were ex-
tended during the war to certain
European governments associated
with US in the struggle. These ceased
several months after the armistice,
except for commitments already made.
They should not now be resumed.
either directly or Indirectly. The
recent Brussels conference, composed
of experts from many European coun.
tries and from other nations, itself
expressed the opinion that further
credits could not be accorded directly
by governments. / do not believe
that they should be accorded in
directly.
Europe Unabie TO Pay.
Exports of domestic products have
not declined since the armistice. On
the contrary. they have greatly in
creased. From an aggregate value
before the war of less than two and
one-half billions of dollars, and of
about six billions the last year of
hostilities. they rose in the calendar
year 1919 to more than $1,000, ,000. 900,
and this figure will probably be ex-
ceeded for the last calendar year. For
the first eleven months of last
calendar year we exported more than
seven and one-hah billion dollars
worth of domestic merchandise. These
have been largely privately financed.
The difficulty in the way of still
larger exports does not seem to lie
so much in the lack of financial abil-
ity here as in EurOpe'S lack of means
to make payment. Her productive
energies and the services which she
renders have not yet reached point
where they balance the value of COM
modities taken from this nation, and
her ability to furnish for additional
exports securities. which business
men would feel justified in taking. is
restricted. The experts of the Brus-
sells conference reported that lone of
the chief obstacles to the granting OF
credits is the absence in borrowing
countries of sufficient securities for
intimate repayment" Until this OBJ
ct facle is removed it is difficult to see
how materially larger exports to
Europe are to be made, even If ex-
porters, aided or unaided by govern
ment finance, stand ready to do their
mart II is remarkable that Europe
is able to make an effective demand
for as large a volume of our goods
as she is making. 1t is gratifying
evidence of her recovery and progress
toward full production and sounder
financial conditions.
Would Not Create Demand.
"Under the law. il the activities Of
the corporation were resumed, no
direct advances could be made to
producers and If they could be they
would not accomplish the objects in
view. They would not create demand
for our products. They could be
made ONLY to exporters or to banks