The Waterbury Democrat., 1933-11-25


 of the 73rd congress and intended as a broad grant of aid. To hold that the United States should share ratably would obviously greatly impair the marketability of the bonds and thus largely defeat the en- which the statute was plainly intended to secure. If the United States were to share equally with the bondholders, the effect would be. that each time the United States made an advance of interest under its guarantee, the bondholder's ex- pectation of receiving his principal would be correspo dingly reduced (although perhaps in a smaller amount). The conclusion seems clear that when congress fully and internationally guaranteed inter- est on these bonds it did not intend it's guarantee either directly or in- directly to affect the security of the principal.
 There is nothing in the commit tee reports of congress which lends any support to a conclusion other than the one I have reached. See house report No. 55, senate report No. 91, house report No. 21O, 73rd congress, 1st session. And an ex- animation of the debates in con- gress lends support to this conclu- sion. It is well settled that in the interpretation of doubtful provi- sions of a statute resort may be had to statements made on the floor of congress by the member in charge of the bill (Ruplex co vs Deering, 254 U. s. 443, 475; United States vs St Paul, M. & M. Ky Co PAT U. s. BIO, 318); and the fact that throughout the consideration of the legislation there was com mon agreement as to it's purpose may properly be considered in con- struing the statute. Federal trade commission vs Raladam Co, 283 U. S. 643, $50.
 The fact that the guarantee was of interest only and not of princi- pal was frequently referred to in both houses, but there was never any suggestion that a consequence of the guarantee of interest should be an impairment of the principal. That congress intended that the government was to be contributor to the security of the bonds, and was not intending to impair that security, was made plain by MT Steagall, the chairman of the house banking and currency committee, and the member in charge of the bill on the floor of the house. In the course of the debate, MT Steag- all said CIT congress record, part 3, page 2500, April 27, 1933):
 Back of these loans not only is the interest to be guaranteed by the government but the basic protec- tion of these bonds is the security back of the loans, plus the addi- tional protection of the $2OO, ,OOO,- 900 initial capital of the corpora tion. 4e
 This statement makes it plain that it was the intention of congress to contribute two hundred million dollars to the security of the bonds by subscribing the capital of the corporation, and that, in addition to this. contribution and without af- fecting the security of the princi- pal, the government was to guaran- tee the interest. That there was no purpose on the part of the govern ment to impair the principal of the bonds was further made plain later on in the same debate where MT Steagall said Cbid) that
 every ClIile you SLr1Ke aL the
 security back of those bonds
 you have made it more difficult
 to negotiate the exchange fora
 mortgage that will save some
 citizens home. That is the real
 object to be accomplished by
 this legislation. (Black face.
 mine).
 To construe the statute as en- titling the United States to share ratably with the bondholders on account of claim for interest ad- vanced under it's guarantee would obviously "strike at the security back of those bonds" and thus tend to defeat "the real object to be ac- complished by this legislation"
 I conclude, therefore, that if the United States pays interest on the bonds of the Home Owners Loan corporation under its guarantee the United States will not be entitled, to payment from the corporation on account of that claim until the bondholders have been paid in full.
 Respectfully,
 (Signed) HOMER CUMMINGS,
 Attorney General"