Evening star., 1934-05-23
PRESIDENT SHOWS
STRATEGIC SKILL
Ability to Handle Congress
Revealed in Message
on Silver.
BY DAVID LAWRENCE.

6IcoluciI1 1SOOSCFClt chAA4 Al AAoAAsA
ling Congress and especially his supe-
rior knowledge of strategy was never
illustrated more forcefully than in his
message on silver.
The President succeeded in reaffirm-
Ing his position that the regulation Of
monetary matters shall, for the pres
ent. be left to the discretion of the
Executive, but he also did not fail
to go as far in the direction of the
silver advocates as is economically
sound at the moment.
Uhquestionably. silver is one OF the
most controversial questions in all
American history. Undoubtedly, too,
preconceived prejudices have much to
do with the casual way that silver re-
monetization is rejected from time to
time on the ground that, because 1t
did not work in the past, it will not
work now.
Mr.. Roosevelt is a courageous reallst
who insists that circumstances change
and that what was impossible a few
generations ago may be entirely
changed today.
Price Fluctuation Difficulty.
Thus the use of silver as metallic
reserve for the issuance of currency
can hardly have the terrorS it had
so years ago when nowadays the Fed
eral Reserve banks issue currency on
9O-day commercial or commodity
transactions.
The real difficulty, Of course. is that
there has been no control over the
quantity of silver in the world and
that price fluctuations have in the
past been impossible to hold IN line
with gold values.
The President promises that he will
do everything possible to bring about
an international control of world sill
yer production and he points to the
achievements since the London Eco
uomic Conference as sign that
something can be done.
Obviously, there can be no final
solution of the silver problem until
all the world agrees, or at least until
there is a stabilized relation between
gold countries and silver countries or
those using both metals.
Whatever kind of world standard
there may be in store for us, Mr..
Roosevelt is emphatic that it must
be the result of an international
agreement. Lest the silver advocates
regard this as just an excuse or an
alibi. the President pledges himself
to take certain steps nationally which,
in themselves, may have an effect
internationally.
Buying Left to Executive.
The legislation proposed does not
say in what length of time the Amer
ican Government must buy enough
silver so that 25 per cent of our cur
rency reserves shall be silver and IS
per cent gold. 1t does not require
the Government to do any buying in
a given year. but leaves it all to the
executive branch of the Government.
No silver advocate, who really wants
the American Government not to be-
come so embarrassed by silver pur-
chases as to ruin all chances of silver
remonetization, will want Congress,
especially with day-by-day changes in
world conditions, to have complete
charge of silver buying 1t was just
such precise and specific limitations
in the past that led to the breakdown
In the use of silver.
To accomplish its maximum for
monetary purposes silver requires a
governmental control of output, ma
tionaliZation of silver in the same
sense that the Government today
owns the gold, and fixing of the
price of silver at figure that holds
the value within reasonable limits.
All this Mr.. Roosevelt has sought to
do in his message on silver, and the
only criticism that opponents from
the silver point of view can make is
that the President has asked fer per-
miSsive but not mandatory powers.
Should world conditions change and
force America to accept a modified
gold standard in an international
sense, there is nothing in the legisla-
ton that would prevent the United
States from agreeing to such a pro-
gram. incidentally, America can use
a large amount in its reserves for cur
rency, irrespective of what the outside
world does about it.
Little Danger of Imitation.
AS long as the President has not
asked for revival of the ancient ratio
whereby gold and silver were to be
maintained by Government fiat at a
fixed ratio of value the one to the
other, while world conditions changed
the same values, there is really little
danger of imitation or currency en-
barrassments in the proposals laid be-
fore Congress.
So far as the silver crowd is con.
cerned, the message makes it possible
to test the good faith of the sponsors
Fifty cents an ounce is a high rate
for silver. and there will be unques-
tlonably an economic improvement ir
the silver-producing States. AS fol
the spectators, they have to pay a sc
per cent tax on their profits, besides
the usual income taxes. Small wonder
that the price of silver didn't sky
rocket on the announcement that sill.
yer was to be definitely taken into the
fold hereafter in large way in the
metallic reserves of the United State.
Government. Mr.. Roosevelt has got
himself out of an awkward politica
dilemma, and while the fight is by NJ
means over the President las split thu
silver bloc and rendered l. less dan.
gerous at this session.