Evening star., 1933-01-22
BY REX COLLIER.

w YANTED- Somebody to whom
M Uncle Sam can lend a billion
wv and a, half dollars before
January %, 1894.
It sounds foolish. But that
Is approximately the situation which
confrontS the Government with respect
to that much-heralded aid to employ
ment and prosperity, the -liquidating
loan provision of the Reconstruction FL
nance Corporation act.
With only year to go, come to-mor-
row, before the offer automatically is
withdrawn, the r. F. C-world's largest
financial institution-flnds itself IN the
anomalous position of one with plenty
of money to lend in an extreme credit
stringency-and few takers.
Perhaps the statement should be
qualified: Few eligible takers. There are
but most of them, when tried under the
rigid rules imposed on the r. F. c. by
law, are found wanting.
The picture is one of Uncle Sam hold
Ing his money bags out to the States,
cities and other agencies for whom the
vast sum was intended, but having so
many strings tied to the bags that it Is
proving difficult to open them.
100000 Jobs Possible.
So far cnly slso0O,o0O in round fig
ures has come out of that billion-and-a
half dollar fund. About half hundred
loans totaling approximately $150,000,-
coo have been authorized however. The
approved loans represent but 10 per
cent of the money which Congress has
given the r. F. c. until next year to
Cisburse
1t is estimated roughly that the loans
already sanctioned will provide employ
ment for nearly 100000 men, working
80 hours a week for one year. If the
same ratio of jobs to dollars may be ap-
piled to the remaining fund, entrance
into circulation through self -liquidating
projects of the entire fund would mean
employment for 100000 men.
Yet, in the words of Harvey Couch,
r. F. c. director in charge of self
liquidating loans, "the surface Of this
vast reservoir of credit has hardly been
touched" Mr. Couch, concerned over
the slowness with which these loans are
trickling into circulation, has made ur-
gent, direct appeals for applicants. He
believes there are many projects which
could be financed by the corporation
within the limits fixed by law, If the
American people were fully aware Of the
fact that money is available-with re-
strictions.
which are the chief obstacles to imme-
diate and Widespread distribution OF
locr~ # this ch~rac'e". Call them "red
tarc," if you will. By whatever name,
the, G ing were tied to the loans by
a Wc--meeni-g Congress and they are
bird.-g on the r. F. c. until another
act loo-ens them.
"Self-Liquidating" Defined.
String No. l Is a provision that the
money must 60 only to "self-llquidat-
ing" projects.
String No. 2 is a qualification that all
loans must be fully and adequately
secured.
There are, in addition, lot of smaller
strings. limiting the character OF appn-
cants, the nature of projects, and so on
Even with these minor restrictions, SO
to speak, the field Of applicants and
projects eligible for loans IS expansive.
The law does not leave to the r. F: G.
the responsibility of interpreting what
is meant by "self -liquidating.
Here is the statutes own definition OF
the term: For the purposes OF this sub
section a project shall be deemed to pc
self -liuuidating if such project will be
made self-supporting and financially
solvent. and if the construction cost
thereof will be returned within a rea-
sonable period by means of tolls, fees,
rents or other charges, or by such otner
means (other than by taxation) as may
be prescribed by the statutes which pro-
vide for the project"
In discussing this provision Of the
act, Mr.. Couch told construction IN
terests recently:
1.-The potential borrower should con-
slider two questions: First, Will tne m
come from the project be sufficient to
meet operating and maintenance
charges, interest and amortization?
second, do the prospective revenues
arise from sources within the contem-
plation of the statute?"
The first question, he points out, In
wolves the compiling of the best avail
able estimates of costs, income and ex-
nenses and considering them in the