Evening star., 1932-10-15
Text of Garner Speech
Speaker Charges Administration With Concealing
True Financial Condition of Country
During Crisis.
did cause fabulous losses and upset the
stability Of business.

did cause fabulous losses and upset the
stability Of business.
Submits Two Questions.
On this specific record covering the
whole field of our economics my sole
comment Is two questions: How about
the foreign alibi? How about the myth
Of business reliance on Republican
leadership?
In 1882 we have new edition Of the
1928 myth-something like this: Last
Winter a wave of fiscal destruction
rolled in from Europe on the embattled
administration until, at its crisis, our
gold standard had two weeks to live.
Our form of government was in the
balance. In spite of flank attacks by
the Democratic Congress, the admins
tration saved the day and came out
with an exclusive program which has
defeated the depression. Thank God
for this Republican administration.
hasten to diSclaim any sarcasm.
What have just said was fair para
phrase of the Des Moines speech. II 1t
sounds sarcastic it is only because Of
the absurdity of the original. Let's get
down to the record. Nobody doubts
that there was a financial panic, which
threatened our banking and credit sys-
tenn. But the vital question for voters
Is: What caused it?" Mr.. Hoover says
II quote):
Critical assaults and dangers swept
upon us from foreign countries" But
he also said in his annual message:
THE fundamental difficulties which
have brought about financial strain in
foreign countries do not exist in the
United States"
In other words Mr.. Hoover presents
that Europe was broke and America
sound, so Europeans rushed to get their
money out of here and take it back to
the very seat of trouble. I also leave
that alibi to the judgment Of American
common sense.
We couldn't listen to that one even
if there had been no cause for panic
here But there was cause here big
enough to panic any country. Back in
1928 Mr.. HOVER said { I quote again) ::
"The assessment Of taxes and ex-
penditures of public monies have come
to bear a vital part in business stability.
We have adopted a measure of Federal
control of credit. Errors in that deli
cate adjustment can cause us fabulous
losses"
Mr.. Hoover's "errors in that delicate
adjustment" are also called deficits.
Last December this administration was
a little more frank about the cause Of
the panic. Mr.. Hoover said:
The first requirement OF confidence
and of economic recovery is finanial
stability of the United States Govern
ment >. must at this time call atten-
tion to the magnitude of the deficits
which have developed -"
There We have it :. deficits the
of nj
began. Why should there by any talk
about mysterious foreign forces?
Quotes From Budget Message.
Who is responsible for those deficits
and (more important stilD how did 1t
happen that we didn't hear about them
till they became so dangerous? Let me
quote from the Presidents budget mes
sage delivered in 1929, six weeks after
the worst crash in HISTORIAN event
mathematically certain to cut down
Federal revenue.
with an estimated surplus of over
S225, 10000 this year 1880 and
s122, ,00O,0 900 next year u93D -. some
reduction in taxes is justified . Our
finances are in sound condition -. Our
estimated expenditures are well
within our expected receipts That
budget also proposed increased spending
in two years of $3.50 100000 more than
We spent in 1929.
You remember that every prudent
manager of home or business was then
trimming sails. But an administration
charged with preserving a delicate bal
ance on which it said business stability
depended, moved in exactly the opposite
direction.
BY December, 1880, every source OF
Federal revenue had diminished 25 per
cent Huge deficits were inevitable. But
this administration estimated current
deficit of only $4,000, 900 with small
surplus for 1882, or a two-year deficit
of only s150,000,000 and said. NOR do
I look with great concern upon this
moderate deficit" It suggests no new
taxes-no decreased spending. Was that
frankness? Was that dealing honestly
with the Congress?
December. 1881, is the period por-
trayed in the Presidents Des Moines
speech. The deficit for that year had
now been revealed as 100000. .0OO-an
error Of one billion in the delicate
adjustment" The annual message
admitted a deficit of over two billions
for 1882. Within seven months that
proved to be nearly another billion
dollar error, and the two years deficit
originally estimated at 150,000.000
turned out to be nearly four billion
dollars.
I know these monumental figures are
tedious to listen to. They can be
summed up, however. in terms more
easily remembered. The record shows
that the administration was either
at sea as to the actual Treas
ury situation for two years or else de-
liberately concealed the true state OF
affairs, deceiving the country until con-
cealment was no longer possible.
No other country ever experienced
such fiscal catastrophe and escaped
collapse. The news began to leak out
in the Autumn. The aspect most dis
this great Government had sat in con-
cealment and inaction for two years
and had allowed the world to believe
that its finances were sound. Coupled
with that df not caused by it) was
the disturbing news of the black busi-
ness year of 1931-no seasonal Autumn
rise, but instead greater relative de-
cline in employment, business, earnings
and prices than in many of the back
ward and crippled" countries. Euro
peans and American alike began
rush to get out from under. The panic
was on.
Now I am not going to characterize
this conduct It is up to my hearers
to decide whether European bugbears
or maladministration Of government
finances brought the credit crash last
Winter.
The question will naturally arise:
Why did this administration play SO
fast and loose? Said Mr.. Hoover at Des
MoineS Il quote):
Some assured me that no man could
propose increased taxes in the United
States to balance the budget in the
midst of depression and survive an
election"
think we might keep that quotation
in mind, not only as to the record I
have given, but when we consider what
- H.