Evening star., 1932-06-06
White House Statement
Corporation-Many Small Banks Shown to Have
Benefited at Conference With President Hoover.

Generally about $670, 1000, 900 Of
loans authorized to date have filtered
through to the use and protection Of a
very large segment Of the whole coun-
try. An encouraging feature Is that the
repayment Of loans has begun, some
$30,000,G00 having been repaid.
THE conference conclusions as to
immediate policies necessary to speedy
economic recovery embrace four prin-
cipal items affecting the Reconstruction
Corporation.
Il. In order at once to stimulate
employment and to stiffen the whole
agricultural situation, to extend the au-
thority to the Reconstruction Finance
Corporation to increase its issues Of its
securities to the maximum of $3,000,-
100000 to enable 1t (a) to buy bonds
from political subdivisions or public
bodies or corporations so as to start
construction Of income producing or
self-liquidating projects which will at
once increase employment, % 10 make
modities SO as to assure the carving of
normal stocks Of these commodities and
thus by stabilizing their loan value and
thereby at once steady their price levels,
(c) to make loans to the Federal Farm
Board to enable extension Of loans to
farm co-operatives and loans for export
OF agricultural commodities to quarters
unable otherwise to purchase them,
(O the authority to loan up to $500,
100000 to such States as are unable to
flnarce themselves for distress.
Committees Proposed.
1T was considered desirable that tenn
porary non bipartisan committees should
be set up to pass upon loans to States
Tor distress and Of engineers to pass
upon loans for income producing works.
Both OF these committees to function in
much the same way as the Interstate
Commerce Commission now acts in
passing upon loans to railroads.
20. The enactment of the legislation
which has been recommended creating
the system of home loan discount banks.
Surveys by the building and loan asso-
Citations and the Department of Com
merce show that these institutions
would not only protect great numbers
Of homes from foreclosures, but that
they would Immediately stimulate from
flve hundred million to a billion dollars
Of construction work in new homes in
many under-built localities and in reno
vations. 1t was considered that these
institutions were a necessary compile
ment to the Reconstruction Corporation
and could well be financed by the cor
poration from its funds If the legislation
creating that system Is enacted.
Coordination Planned,
"3. The Joint Committee Of Industry
and Finance now being created by the
Federal Reserve System in each district
for the purpose Of organized application
Of the credit facilities now available
through the system to be developed in
other cities and co-ordinated with the
work Of the Reconstruction Corporation.
a. That Government expenditures
must be held down absolutely to within
the tax income now provided and that
no programs Of expenditure should be
undertaken which cannot be paid for
from current tax income. Expansion
OF productive public works reQuir-
ing the issuance of Government securi-
ties for any other lines of expenditures
would at once create a deficit and again
unbalance the budget and would render
financing Of the operations of the Re-
construction Corporation extremely diff
f1cult. If not impossible, and would in
crease rather than decrease unemploy-
ment.
The board presented to the Presi-
dent high tribute to the thousands
OF members OF committees and of the
staff OF the Reconstruction Finance
Corporation, working in every city and
located in every part of the Union, who
have given their undivided time and
service to enabling the corporation to
function on such an enormous scale and
so effectively in the short period Of less
than three months"