The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1922-06-07
Shall Finance Corporation Stay9
BY FREDERIC J. HAsKiN/

WASHINGTON, D. c., June Z. =
Once again the fate of the War FL
nance Corporation, ,one of the great
est business institutions ever organ
lied, is dependent upon the view
which Congress entertains of it's use.
fitness. This experiment of the Gov
eminent in the business of direct fl
nancing of citizens has been subject
several times since its organization
either to change of purpose or the
change of complete abandonment.
The War Finance Corporation is
one of the biggest banks in the world,
and it is conducted by the Govern
ment of the United States. 1t has a
capital of $500,000,000 in Government
funds, and authority to issue bonds to
vast amounts.
The original act creating the Corpo-
ration was approved April 5, 1918.
This was entirely war measure. 1t
will be recalled that when the United
States entered the war. the Treasury
offered the Liberty Loans which abb
sorbed so much of the peoples money
that private corporations sometimes
had difficulty in getting enough funds
invested in their enterprises to keep
them going The Government recog-
niZed that this was injurious, so this
Corporation was authorized to make
loans to enterprises of almost any
character which were engaged upon
work tending to assist in the prosecu-
ton of the war. Some of the compa-
MES making war material were in fl
nancial 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, some of them seemingly
remotely connected with the prosecu.
ton of war, were found to be perform.
| ing some duties which helped the
cause and therefore received loans
Coupled with this function, the War
Finance Corporation Act gave to the
Capital Issues Committee, which il
created, the authority to suppress tbs
issue of blue sky stocks and bonds
| that is securities of a doubtful value
| in order that funds be conserved fol
investment in Government bonds and
| legitimate private enterprises.
Help for CattIemen
AS the war developed, it was found
desirable to expand the functions o.
! the Corporation. One of the first ad
ditional powers it was given was tC
make loans to cattlemen on theil
stock 1t was shown that many cat
tlemen were killing off their stool
because they could not get enough
money from the banks to carry then
over the winter. II was recognized
that the country must have food, ant
that it would be a national calamit!
to permit the stockmen to kill thei
immature stock for lack of financing
Immediately after the Armistice
there was a general belief that the eS
ports from the United States, whicl
had reached a high tide during tn
war, would drop away to practicall
nothing. This was regarded as a.
undesirable development, so step
we're taken to stimulate exports. TIL
belief was that if American exporter
could extend credit to foreign buyer;
, the foreigners would take America
goods in substantial quantities. 1t wa
arranged that the American exportel
! upon granting credit to the foreigner
could then borrow of the War Financ
Corporation which would await pa!
} ment from abroad.
Affairs developed so that the Co,
poration did very little of this sort {
! business. A wrong guess had bee
: made Instead of a need existing fc
: the stimulation of exports, the
! sprang of their own accord to prev
ously undreamed of proportion