Evening star., 1935-11-10

S400 000, 900 a month-encounters not
only the unimportant economic truth
that it will not cure depression but
also the very serious weakness that
you cannot find ways to spend it.
So in the course of the year the
P. W. A. as such has somewhat sub
sided. 1t was metamorphosed into
two other projects. One was a grand
housing program that was to restore
prosperity last Winter: some of you
readers may remember it. The other
project is to solve the relief problem
by spending something over S4.000,-
100000 in vork-relef This is to pro-
vide work for 3,500,000 unemployed
workers, the others on relief TO be
turned back to local governments for
care. AS of this writing about 1,000,-
900 have been put to work.
Gold Clause Ruling.
In the course Of the year there we're
interesting developments in finance.
Five of the Supreme Court ruled that
reputation of the gold clause was re-
pudiation. but that in the cases under
review nothing could be done about
it. Four members of the court ruled
that reputation was reputation and
something could be done about it.
This unanimous condemnation of the
Governments conduct was described
by the administration as gratifying" )"
The Government finally surrendered.
foot, horse and guns, to the silver
lobby. A measure was passed calling
for the purchase of vast and un-
determined volume Of silver bullion.
Senator Pittman's lifelong struggle
to raise the purchasing power of the
poor Chinese masses was finally won.
Strangely enough. it turned out that
the measure did Just what the econo-
mists said it would: 1t lined the pock-
cts of the silver crowd and cruelty
injured the Chinese. The chief con-
sequences at home have been to in
fate the currency, give the country a
bar-sinister metallic basis and pile up
a dangerous mass of dead silver that
will some day menace the currency.
The year witnessed the departure
of the advisers responsible for the
monetary program. Before they left
they had, with the aid of the infla-
tionists in Congress, involved the
Government in breach of promise, had
their theories disproved in practice
and given this country a money sys-
tenn that cannot be named, identified
or even described. But even in the
security Of academic shades the neme-
sis of economic truth still pursues
them. The Brookings Institution.
some two years after the economists
had so reported. has found their
theories to be as porous as a sieve.
We are not here to bury the ad-
ministration, but to praise the laws
of economics. The purpose of this
article is to repeat and reaffrm the
theme of the article of a year ago.
Recovery is still on the way. Many
able men see in the present situation
the collapse of our present economic
order. Many other able men see in
it an unconscious Establishment of
socialism. Others foresee a Dictator
ship. Still others anticipate the de-
struction Of all savings, equities and
personal possessions.
Grounds for Gloom.
Specifically there are grounds for
these gloomy forebodings. Industrial
production has been going down most
of the year. The construction indus
try is still fiat on its back. The Treas
ury deficits grow increasingly. The
banks are swollen with increasing
numbers of Government bonds. Un-
employment remains tragic problem.
The vast segment of the population on
relief shows no diminution in num-
bers, but an ominous deterioration in
morale.
Quite as serious is the intangible
menace of the attitude of the Govern
ment. AS one policy after another
has become total loss, its procedure
has been to extend and expand the
policy. This has been conspicuously
evident in the effort to increase the
SIi dIlk lcllOlu VI n. "a a. OlI dSilSui-
ture in the attempt to put banking
credit under political control and in
the adoption of a $4,000, 600, 900 spend
ing program. Congress passed, at the
last session. a number of measures
whose consequences no man know
eth, least of all a Congressman. There
was a labor law that may lead to
bloody warfare. bank law that may
lead to feverish imitation, social
security law that may lead to indus
trial stagnation, Q tax law that may
lead to the end of large-scale produc-
ton, and many others.
The temper Of our Government has
become more brittle and vindictive, its
policies more arbitrary and capricious.
Congressional committees show q
brow-beating and intimidating spirit
toward witnesses not to their liking.
Decisions of the Supreme Court are
challenged and criticized. A proposal
is made to reconstruct the whole
economic system Of this country by a
violent reorganization of the tax sys-
TEN, to be passed over the week end
a. IN improper rider to . wholly ex-