Evening star., 1934-05-16
OFFICIALS DEFEND
HOUSING PROGRAM
Senate Hearings Produce
Strong Support for I'M
provement Project.
Rx the Associated Press.

BY the Associated Press.
The administration housing pro-
gram was described today by Frank
c. Walker. director OF the Nationa
Emergency Council, as an effort tc
stimulate private capital and industry
at a minimum cost to the Govern
ment.
Walker was the first witness al
public hearings before the Senate
Banking Committee on the legisla-
ton requested by President Roosevelt
Monday TO create Home Credit In
Surance Corporation to insure against
losses on home Improvements and
construction.
He testified there had been "a great
tagging in the capital goods industry,
and "a frozen condition" in the mort
gage market.
unemployed. Walker said large por-
ton of unemployment was in the
building trades.
Construction Off 80 Per Cent.
He said home construction had
fallen from an annual average OF
$4,000, 100000 to $500 600 600.
Questioned by Senator Couzens, Re-
publican, of Michigan, Walker con-
ceded there was mot a great de-
mand" at present for new housing
but he argued there was ''an absolute
demand for rehabilitation, repair and
Improvement
Walker said experience had shown
losses of from 2 to per cent on re-
pair loans and he predicted there
would be no hazard approaching the
20 per cent provided for under the
insurance plan.
He conceded there was no unanim-
ity Of opinion about whether COM
mercial banks would go along" but
said they would have to be relied on
in the smaller communities.
Albert L. Deane, president Of the
General Motors Holding Corporation
and temporarily an N. r. A. official,
testified that the way to get wide
spread repairs was to make money
available to the home owner.
Holds Plan Is Sound.
He called the plan economically
sound" and said he was strong ad-
vocate" of consumer credit.
Deane told the committee similar
financing by Johns -Manville and
American Radiator Co. had shown
losses of about per cent. but their
loans ran for only 18 months as a
maximum, as compared with years
under the bill.
"Uncuestionably the longer time
and smaller monthly payments will
increase the losses he added.
Deane said the true annual interest
rate under these commercial plans
was about 20 per cent where under
the bill it would be between Z and II
per cent.
Operation Of the plan would require
a very small organization in Wash
ington, Deane said, because 1t would
be in private hands except in case
of defaults.
Credit Limit Is Seen.
Senator Adams, Democrat, Of Colo
RADIO, asked if the whole plan was
not calculated to deepen our prob
lem" by getting home owners to assume
obligations they could not meet.
Credit would not be extended to
people who couldn't meet the obliga-
tion," Deane replied, adding that with
out such help the home owners prop
erty value would disintegrate.
Deane termed the plan the most
constructive thing that has been done
in the last three years"
The House Banking Committee also
plans to begin hearings some time this
week
Senator Robinson, majority leader,
estimates it will take at least three
weeks to get the proposal through the
Senate and the hearings today were
taken as an indication that the ad-
ministration does not want the hous-
ing program to delay adjournment.