Evening star., 1933-01-01

unedSOl6SS, as Lllt
very foundations OF n
banking, as well as
of state finance, David Lawrence.
were threatened
bv a general loss of confidence. which
was concretely expressed in the form
of boarding inside this country as well
as the fight Of gold from our shores.
There can be no question now In
retrospect that the creation of the
Reconstruction Finance Corporation, as
well as the passage Of the Glass-Stea-
gall act, came in the nick OF time ana
arrested panic whose proportions be-
came visibly large. There can be no
question also that during the Spring
and early Summer of 1892 the United
States recovered its poise and strength
ened Its banking and financial structure
to such an extent that it could look
forward to the reconstruction era with
q feeling that America had seen its
worst days.
Answer to the Paradox.
Such statements as the foregoing,
however, will Immediately be challenged
by those who looking around them see
evidences of gloom and encouragement,
business statistics and reports that re-
veal no substantial progress and on all
sides a feeling that general business has
not made any substantial Improvement.
The answer to the paradox lies in the
fact that readjuStment is as painful and
as dificult a step in the course OF an
economic depression as any phase from
the beginning to the end. Gonzales
cence has its relapses as well as Its ex-
hilarations.
1t may be disputed by those who are
IAI Harf
the less that the Nation had begun a
forward march during the Summer and
received a setback in September when
it became likely that there would be a
change of administration. Looking
back now it, is clear that the Maine
election told the business world that 1t
must expect in November vote to
+, change pilots Knowing what this
means under our constitutional system,
business saw indeed that 1t must wait
for several months after November be-
fore 1t could be assured once more that
there was definite forward advance.
Whatever we may think individually
about the desirability OF change IN
administration in Washington, and
unQuestionably many millions OF people
wanted q change and their collective
Judgment ought not to be doubted, the
fact remains that the most unfortunate
thing about the current depression was
the coincidence of a presidential elec-
tion with a year which could little
stand q change in crisis. 1t would
have been far better for the United
states II the presidential election had
come In November, 1898. Then
America would have recovered It's
strength sufficiently to stand the shock
of divided counsels and the gap IN
government which must necessarily
follow between November and the fol-
lowing Spring. The Republicans nave
been in power IL years and in the nor
NAL course of events the pendulum
swings anyhow. The American people
alike to shift from. one Of the major
parties to the other and in the long
kun this is q desirable thing IN
democracy.
4 Change Means Delay.
= But the immediate effect of change
ht this time has been to stop the wheels
Of progress and to wait. 1t Is not nee
sessary TO fight over the battles OF the
hast presidential campaign TO record the
6conornic effect of that historic struggle
between the major parties. It's water
skver the dam now and the American
people already have in process con-
Etitutional change known as the Lame
buck amendment which will shorten
khe time between the November election
and the Inauguration of new Presi-
dent as well as the calling OF the Con-
Eress which Is elected at the preceding
November. A gap of only about Two
months will occur hereafter.
But 1t is not merely the gap in gov
eminent that has proved setback for
American economic progress, but the
fact that the hoped-for cooperation be-
tween the outgoing and incoming ao-
ministrations has not materialized. II
was perhaps too much to expect that
political rivals and ambitious groups OF
contesting politicians would see eye 10
eve with the Nation in its desire Tor the
having aside of politics in common
cause. 1t was difficult even during the
war for the Republicans and the Demo-
crats to cooperate, though externally
thev gave a good exhibition Of coalition.
THE truth of the matter Is that rival
politicians do not trust each other and
there Is no force big enough In the
United states to compel them to Work
together.
The laynnan, Of course, doesn't under
stand these things. He feels that tne
situation in America today is even more
serious than it was during the war and
that the crisis is big enough TO make
the leaders Of the country, irrespective
of party, work together for the common
good. Since the election, however, the
Democrats have indicated that they
would not like to assume any respofSl-
bilities until March A. The Republic
ans. on the other hand, have publicly
spassed the buck" and are doing very
little except to liquidate their admins
tration.
War Debt Problem.
The price of this costly break In
government viii probably never oe
known until after the history OF the
entire economic depression can be
Eritten. Certainly the effects OF this
Eepression could be mitigated II many
~ the proposals which have been be-
soye the United States Government al
Eell as other governments could have
Seen acted upon much sooner. On
doubtedly. for example, the war debts
t,ave been given an exaggerated impor-
sance In amounts they are not likely
IN affect the world situation very much
even IL they are materially reduced
But they do have psychological value
which has become lnterwoVen ~, IN IN, .ns
entire international situation. The faci
that the United States Government
cannot function on this question unit
some time in the Spring Is regaroee
Moth abroad and in this country o.
,eccr,ornists as most unfortunate, be-
krause 1t delays the settlement OF on'
HI the outstanding sources OF irritation
III the world. Whether the unitee