Evening star., 1932-10-22
Roosevelt Says G. o. p Is Using "PanicC Gas"
TO BLIND" VOTERS.

rH ATTEMPTING TO BLIND" vo1
prises what are known as foreign bonds.
This Is an unsavory chapter In Ameri-
can finance. These bonds In large part
are directly the fruit OF disastrous
policy pursued by the present admin
istration in Neutrality-suspicious. other, II
you please, than the policy OF lending
to backward and crippled nations.
Fragrant instances of the abuse Of
American investors occurring under
this system are well known. When,
after my address at Columbus last
August, the Secretary of State choose
to come to the defense OF the admin
istration, his apology was SmOthered
by irrefutable and devastating state
ments Of facts from Senator Glass and
Senator Barkley and many others. The
administration has not since attempted
to defend the indefensible fallacy of the
Department Of State with regard to
these investments. II we were depend
ing upon these bonds as an integral part
of American finance we should be fear
full indeed. But fortunately, or un-
fortunately, as you choose to look at 1t,
the returns on the foreign bond list
have already come in. Many are In
default. Others have lost the major
part of their original face value. The
best that can be said Is that the danger
is in great part behind us and not
ahead Of us.
Cites Announced Policy.
I have already announced the policy
of my own administration in this re-
gard. My job will be to prevent re-
currence of this incident and to pre-
vent the hardearned dollars of Ameri-
man investors from being frittered away
in foreign fields, encouraged by the
sanction of the Federal Government of
the United States, and with a profit
flowing only to certain international
financiers whose greed is greater than
their patriotism.
Fffth-Domestic industrial bonds.
These obligations do not represent
jor difficulties. They are not widely
held by banks, insurance companies,
savings banks, OF the credit institu-
tions of the country. They are largely
in the hands of private investors. The
amount is relatively small In quantity
for the industrial companies during the
past few years were engaged not in
creating debts, but In paying them. On
the great chessboard of American finance
the industrial obligations do not con-
stitute danger.
The problem of industry Is not strictly
speaking problem Of finance 1t is a
problem which dealt with in my speech
at San Francisco So far as possible.
industry should be organized so that
it will give every workman the right
to earn living through his own effort.
Such influence as the Federal Govern
ment may have should be directed to
this end.
Public Utility Debts.
Sixth-Public utility obligations.
In connection with public utility OBJ
legations, I am not speaking now Of
the financial excrescences on the pub
lie utility system represented by pyra-
mided holding companies. some OF
which are already in bankruptcy and
others Of which have already been dis
counted by the public markets. These
companies that are engaged. not In
stock jobbing. but in the sound and
business of distributing light
power, heat and public service. have
obligations which do not at this time
constitute problem in American
finance. As group they are currently
i
already set forth In my Portland speech
my attitude toward the problems of
these companies
The outlines of my public utility pol
icy are definitely in the direction of
protecting the investor. as we'll as the
consumer Certainly the integrity of
the financial obligations represented in
this group will be conserved to a greater
degree than ever through an adoption
Of my policy toward public utilities
There has not been. so far as / have
been able to determine, single re-
sponsible criticism Of the program there
set forth.
ask the simple question, What
leadership has the President exerted
toward the elimination of the type of
abuse which resulted in the insult
failure?"
The indifference Of the present ad-
ministration has permitted the savings
Of thousands Of our citizens to be swal-
lowed up and lost for all time
Railroad Obligations.
observation-disclosures.
And now I come to the railroads.
Railroad obligations, mostly bonds
amount to IL billion dollars. They bear
interest charges of nearly half a bill
lion dollars a year. Such bonds are
held in savings banks, insurance COM
panies, commercial banks and similar
institutions. In the year 1881. admit
tedly a bad year. the railroad system
as whole earned slightly more than
its interest charges on this entire group
of bonds. The year 1882 has not been
so happy. although railroad earnings
n iV,n
As to the Democratic plan of meeting
this problem, not only in the interest
Of maintaining railroads at a fair de-
gree of efficiency. but what is more
the protection of the saw
ings of millions Of persons in this
which are involved in the
securities Of these railroads, made it
a cardinal point in my railroad address
that the railroads should be freed
from certain destructive competition:
that the Government should undertake
for specified period to see the rail-
roads through. provided they put their
own houses In order. Note the differ
ence between this and the program of
the administration. Without plan, and
apparently without thought, the best
that they could do was to advance a
dole to the railroads month by month
as emergencies might arise. leaving
both the railroad and the bondholder
as to whether each dole
would not be the last.
This was not meeting problems It
is sticking financial mustard plasters
on the railroads.
Only One Way to Do Job.
There is only one way to do this
job, and that is to do it. Where ad-
justments are to be made, let us find
out what they are. Let us arrange for
their handling In swift and orderly
method. Let us make definite COM
that once the railroads house
is in order the Government can stand
firmly behind it. Our Democratic plan
has been before the country now for
some weeks. Experts on the situation,
railroad managements,
unions, employers. workers and
investors have joined in almost univer-
sal approval of the soundness Of this
plan.
Real estate obligatiUns.