Imperial Valley press., 1933-02-03
R.F.C. LOANS
To CALIFORNIA
DRAW PROTEST
Capital Reports State 80 Per
Cent Of Liquidation Advances
Made In This State.
PLAN TO APPLY BRAKES
Leaders Assert Government May
Hold Sack In Case Projects Do
Not Succeed.
BY RAYMOND CLAPPER
United Press Staff Correspondent

United Press Staff Correspondent
WASHINGTON, Feb. 8 - The
large share of self-liquidating pro-
Ject money which the Reconstruc-
tion Finance Corporation is pour
ing into California is bringing COM
plants from other sections.
A resolution by the Dubuque,
Iowa, Chamber of Commerce and
letters from miscellaneous citizens
elsewhere were received by the R.
F. c. even before its latest author
ization of a 22,800,00O loan to Los
Angeles for power line from
Boulder Dam.
This lean gives California more
than 10 per cent of the total self
liquidating loans authorized by the
r. F.. C. to date.
On the eve of the presidential
election two other large California
loans were granted, $4O,000O 900 for
the Los Angeles aqueduct and $61,-
100000 for the San Francisco bay
bridge. California newspapers at
the time said the San Francisco
loan was due to the assistance of
Secretary of Treasury Ogden Mills,
then there on speaking trip for
the Hoover-CurtiS ticket, who tel
ephoned Washington and persuad-
ed the r. F. G. to speed up its ac-
tion at the urging of San Francis
co business men.
The next such loan in size is one
of $13,000,000 for the combined
highway and railroad bridge at New
Orleans.
Battle Raging
An undercoyer battle is going on
between home members of the R. F..
c. and those in congress like Sem
ator Wagner, Democrat, New York,
who assert the corporation is not
moving rapidly enough in aiding
construction projects as an unem-
ployment relief measure. From
some influential senatorial sources,
: r. F. c. members have been urged
to loosen up on loans which mean
work in various communities and
tighten down on advances, which
the hands of private bankers.
This difference of opinion in
wolves the whole principle of
whether the government shall con-
tinue to pour public money into
construction work.
Senator Wagner and Senator
Couzens CRep) Michigan, assert
1hot tIic &c occoy,+io1 toauorJ ,.ect Or
ing normal conditions.
Within the r. F.. G. there is
strong feeling by some that few
projects can be safely relied upon
to- become f-liquidating, or in
other words to pay for themselves
eventually. When the government
advances several million dollars to
start some such construction job,
it then has the responsibility of
protecting that investment.
Government Takes Risk
Suppose the community can't or
won't raise the additional funds to
complete the job? The government
must throw in more money or else
allow the undertaking to stop half
way finished and in a totally use
less condition.
Or suppose the bridge or power
plant is completed and operation
starts and the revenues are not
sufficient to pay operating charges
and leave anything over for re-
paying the federal loan - then
Washington must either take over
the project and operate it or else
take its loss and forget it. That.
in substance, is the talk of those
who would put on the brakes.
The answer to this is that in
most cases these projects are un-
questionably of value to the pub
lie, and even if they don't pay
back in the end, the public gets
the use of them and there has been
real addition to physical equip
ment which has definite social
value.