Every evening, Wilmington daily commercial., 1922-06-07

wsshington. June 7.--Onos again I
IN. fate OF the War Finance Corpora
ton. ono OF tho greatest business In
stituijons ever organized, ~ oepeh-
dent upon tho view which Congress
entertains of it's usefulness. inns
experiment OF tho government In the
business OF direct financing OF citizsns
has been subject several times SINCE
its organization either to change OK
propose or the chance OF conp'o'e
abandonment.
Trs War Finance Corporation Is one
Of tho biggest banks in tho worid.
and II is conducted by tho government
Of tho United States. II has n capital
OF $500. 900 900 In Government funos'
and authority 10 issue bonds 10 Vast
amounts.
Tho original act creating tho Cor
poration was approved Apri y iSlo'
This was entirely war measure ~
will ba recalled TINT when tho United
States entered the war, tho Treasury
offered tho Liberty Loans which so-
Isorbed go much Of the peoples money
THAT private corporations sometiines
lhad difficulty in getting enough funos
Invested in their enterprises 10 Keep
them going. Tho government recog-
nized that this was injurious. so
this corporation was authorized 70
make loans TO enterprises OF almost
any chartcter which were engaged
Iupon work tending 10 assist in the
prosecution Of the war. Some OF the
oompanies making war material were
' In financial difficulties and loans were
made TO them. Street car companies
which carried employees in munition
factories TO and from their work were
eligible TO receive aid. Many other
companies, come OF them seemingly
remotely connected with the prosecu-
: tion Of war. were found 10 be per
:, forming some duties which helped
= the cause and therefore received loans
Coupled with this function, tho Wa
Finance Corporation Act gave 70 tn
u Capital Issues Committee. which J
u lcreated, the authority to suppress IN
> issue OF blue sky stocks and bonds
y that ia securities of doubtful value
In order that funds be conserved 10
investment I'm government bonds an
~ legitimate private enterprises.
. Az the war developed. II was foun
desirable 10 expand tho functions q
) tho corporation. One of the first ad
. ditional powers 81 was given was
-, make loans to cattlernen on thei
a. stock. II wns shown that many cattle
i, men we're killing on their stock be
- cause they could no. get enough none
from the banks 20 carry them owe
~ tho winter. II was recognized that IN
n country must have food. and that
~ would be n national calamity 10 pei
!, init tho stockmen TO kill their imms
ture stock for lacking Of financing.
70 Immediately after tho Armlstic
al there wns q general belief that n
n exports from tho United states. vhir
sn had reached a high tide during II
81 war, would drop away 10 practical
nothing This was regarded as q
AZ undesirable development, 40 steps we
G taken to stimulate exports. The b
I'm lief was that II American EXPORTS
On could extend credit 10 foreign buyer
in tho Foreigners would take Americs
i,t goods In substantial quantities. II vi
arranged that tho American erporte
upon granting credit TO thh foreisns
could then borrow Of tho War Finan
Corporation which would await pa
ment from abroad.
Affairs developed so that the &C
poration did very little OF this sort
- business. A. wrong guess had be
made. Instead Of need existing
tty the stimulation Of exports, they spra
DIS Of their own accord to previously u
dreamed OF proportions. Much ere
In actually was given. but it was work
on bankers acceptances through
tty Federal Reserve Banks IN a mann
which did not require the good offs
Ire of the War Finance Corporation. T
II that Is another story, which. IL
ew lowed. would open n discussion Of I
whole postwar boom and the sub
quent price recession. At any RI
= little export financing was done by
g. corporation and, the war being ov
49,, there was no more OF the war
= :, financing TO be done. The busin
a.. OF the corporation sagged.
-" In fact. IN May, 1920. the board
directors OF the corporation, OF VIII
Secretary OF the Treasury Hous
hat then was chairman, adopted a reso
vim ton suspending activities. No n
70 loans were made; the corporatic
bly, offices merely collected payments
dge the loans outstanding.
That summer came the heavy
IN prices. particularly in prices
ri,- farm products. IN the autumn
yer agitation was started to revive
cen War Finance Corporation TO help
farmers because people had achie
the habit OF thinking that this gr
IN government bank could be turned
will almost any purpose. There were mi
~ who opposed the revival, declar
4, -. that II was time the government
ioa. out OF business.
~ After a spirited contest the corpo
not
py'e