Evening star., 1933-11-12
Cost of New Deal May Reach
$11,735, 900, ,O0O-R. r. C.
Total Excluded.
t00SENlNG UP SHOWN
By LONG. TERM LOANS
Question as to How Much Of Fed
eral Money Is Spent or Lent
Is Studied Closely. s.
BY JOHN A. CRONE.
I nisnafrtn - --l,a cAar

NEW YORK, November 1.-THE de-
cline Of United States Government OBJ
legations, a result of dollar depreciation
and consequent flight of capital, is ren-
tering the attention of agriculturists,
bankers and business men on the big
gest business in the country-that Of
the national Government. re
This interest was heightened today by
the announcement Of the National IN
dustrial Conference Board that "the
total cost of the new deal, including
contingent liabilities of the Federal
Government, may amount to SILL
The extent to which bankers. btisi-
ness men and farmers depend on their
own initiative rather than Government
assistance will determine how much the
new deal will cost, or. in other words.
how much the Government viii have
to spend rather than lend
survey of leading Wall Street banks
indicates there has been a loosening
up OF long-term loans to 'tfirst-class
credit risks" Although business men
profess to be troubled about the NJ n.
A., the net profits of at least 205 COM
panies In the first nine months of this
year. according to a compilation of
the National City Bank, showed an aR-
grcgate gain of 562 per cent over the
same period OF 1882 Actual net
profits Of 5000, o,3e7,0Oo. contrasted with
In the same period, according 10 the
Bureau OF Railway Economies. the class
! carriers reported a net operating
income of s340. .973 s77. or a gain of 77.4
per cent. compared with last year.
Hard to Understand.
The average business man. reading
about the huge authorizations Of money
70 De put out-some spent and soune
ienr-by the United States Govern
ment, at once assumes that all of these
sums have found their way into the
public purse. He therefore cannot
understand why recovery has not pro-
ceeoed at a more rapid pace.
III the Reconstruction Finance Cor
poration. stated the National Indus
trial Conference Board. sis included as
estimated liability Of the FEDERAL esov-
eminent Is raised to $I5135. .0O0 00lS
How much of this estimateS sis
l35 5000, 900 has found its wav int ,,rj,-
iic channels? Roughly only 81 $50
VUV,UO0, according to reports available
some OF them up to September 80 and
others to October 81.
How much of this s4,450. .0Oo. 600 win
oe spent and how much lent? That
depends entirely on the Cooperation
OF bankers, business men. farmers ana
the public generally
Certain items, however, have been
by the Federal Emergency Relief Al.
mnStratl0n. Economists differ on
whether the 500. .ooo. .oOo of expendi-
Civilian CONSERVATION Corps has ~ bee5 e5
spent or lent Certainly the improves
ment in our national natural resources.
the prevention of floods and Similar
G. c. c. projects must be considered
more IN the light of long-term inyest-
ments than as mere spending.
Various Items Listed.
The grand total of liabilities under
the new DEAL" continues the Industrial
Conference Board, consists of the fol-
lowing items: Federal Emergency Ad.
ninistration of Public Works. s3,I50.-
10000; Agricultural Adjustment Ad-
ministration Treasury appropriation,
Sl0O,00O,000; processing taxes, two
years. years estimate, sl,ooo,ooo. 900; Farm
guaranteed bonds. $4,000, ,000, 900; Re-
construction Finance Corporation.
$500 600 900; Treasury appropriation,
Sl85. 900 900; Home Owners Loan COZ
poration-R. F. c., 5000, 900 600; Gov
eminent nt-guaranteed bonds, 81, 900 000,-
600; Federal Emergency Relief Admin
istration-R. f. c.. $500 900 900.
Emerency Conservation Works AdA
ministration estimated expenditures one
year, $3.50 900 900; Tennessee Valley Au-
tnority- y-Government-guarantced bonds.
$oO, 1000, 900; Federal Deposit Insurance
Corporation contingent liability. $4,000
100000, or altotal of sil,735, ,OOO. 900.
Reconstruction Finance Corporation.
total lending ability, minus items
stated above. SO, ,40o, 900 900, or a grand
total of Sl5.135, ,000, ,000."
In an interview, members of the In
dustrial Conference Board stated
The total cost of the new deal would
amount to $15,135.0 10000 If, in addition
to direct expenditures of the Govern
ment on public works, farm relief, and
unemployment relief all the various
loans that the Government is making
through the r. F. c.. the Farm Credit
Administration and other Government
agencies, proved to be bad loans or
frozen assets and were taken over by
the Government. 1t is impossible at
the present time to estimate what pro-
portion Of the loans made by the Gov
eminent to railroads. banks and trust
companies, farmers. home owners,
States. municipalities and various bust
nesses will be repaid
The probabilities of repayment will
improve with the improvement in the
general condition Of business and in
the condition of the particular branches
OF business to which most of The loans
are extended In the absence of such
business improvement there is no reason
to regard the total figure of sl5,i35,-
100000 as the final maximum"