Evening star., 1932-12-04
BY WILLIAM HARD.

1t Is reported that President-elect
Roosevelt hopes to avoid a special ses-
sion Of Congress after March 4. He
can avoid it only if farm relief prob
lens are effectively settled by the ex-
isttng Congress in the short session
beginning Monday. The possibility that
the short session can produce such set
tlement of problems so numerous and
so complicated seems highly doubtful. j..
One of the most urgent farm relief
problems Is that involved in Philip
pine independence. Farm organizations
are determined to accomplish indie
pendence Of the Philippine Islands as
soon as possible in order to stop i'm
portations Of Philippine sugar and
vegetable oils within the smallest
feasible number of years Terms of
the bill fixing the date Of independence
end scheduling progressive reductions
in importations will require in all
probability large amount Of discus
sion and struggle.
Moreover, II the bill becomes too
drastic 1t may incur presidential veto.
Settlement of this problem of the
Philippines in the midst of the short
session, dedicated to beers and wines
and spirituous liquors. and to taxes,
economics, appropriation bills and
balanced budgets, would in itself be
large labor.
Then comes the problem Of refinanc-
ing farm mortgages. This is major
legislative and economic operation.
Both President Hoover and President
elect Roosevelt are committed to 1t.
Organizations are insis;ent upon 1t.
Nevertheless, the prospective burden Of
it upon federal finance is SO terrific
that methods Of adjusting that burden
to the shoulders of the Treasury will
necessitate anxious consideration and
prolonged scrutiny,
Long-term mortgages Of farmers of
the United States now total ap-
proximately $4,000, 900 600. Short-term
debts of farm operations total prob
ably three billion more. The Federal
Government during the last Few years
has advanced $l,200,0 900 of credit
for agricultural purposes. The volume
Of debt involved in the total situation
is prodigious.
The proposal now made is that all
this debt shall be refunded at lower
rates Of interest through further Fed
eral Government intervention. The
most distinguished bill already intro
duced on the subject is by Senator
Va NOItll OnkOld. lie
prospective development OF that bill
would carry the Government into
financial efforts unparalleled since the
great war.
The Government would sell many
billions Of new bonds to private in
vestors. 1t would take money derived
from such sales and in effect buy up
mortgages now resting upon agricul-
tural acreaEes. 1t would become a su-
preme mortgage creditor Of the agricul-
tursl industry Of the whole country.
1t would charge the farmers q very
low interest rate. Most OF the plans
put that rate at 8 per cent. One
half Of the per cent would be de-
voted, however to retirement Of princi-
pal Of the money lent. Only the re-
manning one-half Of the 8 per cent
would be true interest.
The proposition boils down, then, in
the plans Of many Of its promoters,
to the idea that the Government shall
ton arises: Can the Government sell
long-term bonds at IA per cent?
The answer in the money market is
1t cannot. The problem thereupon
merges into even the larger issue Of
taxation in general How far should
the Government 20 in raising taxes
from the people at large in order to
get funds for the rescuing Of farmers
from the crushing and demoralizng
mortgage situation?
That question will arouse o tempest
Of oratory and will enlarge itself into
debate on the topic of fiat money.
Many friends Of Federal ref1nancing OF
farm mortgages perceive clearly that
the Government will have difficulty in
borrowing sums Of money necessary for
it. They thereupon frequently propose
that part of the money shall be provided
through issues Of paper dollars repre-
Federal Treasury
the issuing OF fiat money will turn
out to be immediately related problems
in an effort to achieve a satisfactory
farm relief legislative program. 1t Is
doubtful II any bill with even flavor In
it OF fiat money would be signed by
President Hoover. 1t is equally doubt
full II any such bill would be signed
after March 4 by President Roosevelt.
In any case the complexity Of the farm
mortgage problem in itself would
occupy the attention Of any diligent
and cautious Congress for many unin-
terrupted weeks. That these weeks can
be found during the short session Is
certainly unlikely.
Meanwhile however, the knottiest Of
all farm relief problems will be stimuli
taneously clamoring for solution. That
Is, devising Of q scheme whereby exist
ing domestic prices Of exportable farm
products can be raised to profitable lev
els through legislative action. The
scheme now holding the forefront of
debate on this point is the so-called
domestic allotment" plan.
Il
In all It's various forms this plan in
cludes payment to farmers of sums OF
money proportioned to domestic con-