Arizona republican., 1921-07-27
IRepubIIcan A. P. Leased WIrel

A response was made immediately by congress today to special message from President Harding requesting that powers of the war finance cor poration be broadened to take charge of funding upwards of $500 1000, ,00e of railroad debts and to provide addi- uonal farm credits.
 The president in his message de- clared that the government was morally and legally bound" to fund the railroad debts and was under "an impelling moral obligation" to provide agricultural credits
 The first step toward yasoiing the second of the two. requests-proyi- sion for additional farm credits-had been taken in the senate before the. message was read. Senator Kellogg, Republican, Minnesota. introduced bill drafted by Secretary Hoover and Director Meyer of the war finance corporation. and said to have the ap- proval of the president as a substi-' tute for the pending Norris bill. to create a $10O, ,000, 900 farm export cor poration. The bill embraced the presidents suggestions to empower the war finance corporation. instead of a new federal corporation. as pro- vided in the Norris bill, to advance credits for agricultural exports
 The message dealt particularly with railroad financing and declared sthe proposal that the war finance corporation take charge of fupding the railroad debts to the government would cause "no added expense. no added liability. no added tax burden" ]" The president described the proposal as a simple remedy" contemplating receipt and disposition by the corpo- ration of ample securities" depos- ited by the railroads.
 The message was referred by the senate to it5 interstate. commerce committed. but Chairman Cummins. in l-health. was. out of the city. and when the railroad legislation would be taken up was in doubt. Leaders. how ever. expected action within. the next fortnight. Several senators stated privately that they would fight the IeEIs1ation.
 Abstract of Messass
 Railway claims. based on the 'in- efficiency of labor" during the war. the president said. were to be waived for the present to hasten settlement without surrender of. any rights in court Although the railways owe the government large sums, the pres fdent said. the government also owed the railroads large sums on various accounts
 NO added expense" said the pres- ident, explaining his request, mo add ed investment is required on the part of the government, there is no added liability, no added tax burden"
 sTt is merely the grant of authority necessary to enable a most useful and efficient government agency to use It's available funds to purchase securities for which congress already has authorized the issue, and turn them into channels of finance ready to float them
 ~The contract covering operation provided that the railways should be returned to their owners in as good condition as when taken over by the government, and the transportatlpn act. recognizing that betterments and additions belong to capital account provided that such sums as the rall- way companies owed the government for betterments and new equipment added during the period of govern
 ment operation. might be refunded There has been, at no time. any question about the justice of fund.- l ing such indebtedness to the govern
 ment. Indeed, it has been in pro- gross to a measurable degree evel since the return of the railroads te their owners. It has been limited 1 however, to such cases as those 1T which final settlements with the rail way administration have been af- fected The process is admittedly too slow to meet the difficult situation which the owners of the railroad:
 have been facing. and I believe i | essential to restore railway activi- | ties and essential to the country'' | good fortune to hasten both finding | and settlement
 Government Owes Roads Quite apart from the large sum: