Askov American., 1933-04-27
THE NATIONAL
GOVERNMENT
BY CONG. JOHN PAUL kvALE

April 22-His hand literally forced
by an insurgent Congress, the Pres
ident during the week has definitely
set out upon the pathway of what is
generally described as initiation, al
though the correct term should be re-
flation, or still better, expansion. In
other words, under the proposed plan.
he will be given power to cause an
added volume of credit and currency
through paying a share at least of
deposits in closed banks, through Fed
eral Reserve purchase of government
bonds on the open market, through
purchase of silver, through possible
issuance of a large volume of new
money as well as through possible
outright revaluatiOn of the gold dol
lar (this as last resOurce). All this
multiple power may be carried out by
the President without restriction,
through such combinations as he may
consider best and most effective.
Immediately preceding the an
nOuncement, House leaders had ac-
knowledged failure in their effort to
bind members by amending the dis
charge rule That has been explained
| in these columns. Two open evening
meetings were held last week, at
| tended by a large number of members,
where expansion versus deflation was
discussed by experts. One was called
by the Progressives, active as body
for the first time in the new Congress.
The writer had the honor of presid-
ing, and speakers included former
Senator Owen, who wrote the So
called bonus bill which the House
passed in the last Congress but which
failed to get by the Senate, and also
Professor Irving Fisher of Yale, long
an advocate of the honest dollar
A professor from New York Univer-
sity was also there to outline objec-
tions to the proposed bill for relief
of mortgaged home owners in cities,
and to stress the community of in
terest with farmers who have been
protesting against excessive interest
rates and other Objectionable features
of the farm mortgage bill sponsored
by the administration.
The new administration plan is OF
course at variance with previous steps
which have been taken, one by one.
1t does not necessarily mean initiation.
That must be kept in mind. But 1t
does mean the end of deflation
through writing down of credits, ty-
ing up of billions in deposits in closed
banks, and the rest of the violent re-
adjustments which have been made
on all sides.
Expansion will of course mean loss
es for big business, for salaried peo-
pie in all walks of life, for pensioners
and for those who have fixed invest
ments or deposits. That is newt
able. for the dollar will be brought
down in value to some point which
is as yet undetermined. AS conse.
quence, commodity prices will go ul
correspondingly, and there is the in
terest for those who produce. Anc
all this power, under the proposed
LEGISLATION, is to rest with the PreS1
dent. thus taking it away from Wal
Street for the first time in genera
ton. With the increased purchasing
power that will result, it is OF course
expected that the renewed demant
for goods will bring about employ
ment of a good share of the millions
that today want work, but canno
find it.
The writer has been among those
who have insisted that one vital stel
in the plan has as yet not been OF
: ficially mentioned. That is the &C
compartment of an adequate ia!
structure which will assure the tax
ing by Uncle Sam of a good share a
: least of any speculative profits tina
inevitably follow any expansion or In
| flation 1t is said by some that th'
r administration plans that for mex
: year. That will be too late, for a
sure as expansion comes, so surel.
2 will also come group of new mil
: lionaires who have the advantage
l of credit and opportunity. who se'
their equities pile up, and who cal
2 gouge labor at the present ruinousl,
low rates as well as those who suppl
the raw materials on the disorganlze'
. market.
A tax bill, modelled perhaps afte
the wartime eXcess-prOfits tax, to