Evening star., 1935-02-03

system Of the Nation had always pro-
ceeded upon the assumption that pri.
vate business agencies should create
business activity. The Federal Re-
serve currency system was based on
the theory that as business expanded
new fountains of credit and currency
should flow forth to serve the en-
larged needs. That was in accordance
with the old-fashioned economy. The
New Deal exactly reversed this process.
Again, 1t had been the time-hon-
ored system of business that loans
should be based on existing values
and that the security for loans should
| show a margin Of value above the
amount advanced. The New Deal
reversed this process. 1t lent hugely
on commodities, handing the bor-
rover sums in excess, instead Of
below, the existing value of the Sc
curity. Then, the Government stip-
ulated with the borrower that he
should curtail his production, create
shortage in the commodity, and
thereby increase its price.
For many years one Of the greatest
of the executive departments of the
Government, the Department Of Agri-
culture, had bent all its scientific
forces to the increase Of crop pro-
duction. The new American Gov
ernment reversed this intent and
spent fabulous sums to curtail pro-
duction. The General Land ONCE
had thrown open the wide, unpopu-
lated spaces of the country to home
81 r,,t,a xr-N1tId hriV1ey fhovvN IfndpY
cultivation. A new agency bought
land back into Government title to
take it out Of use.
With the encouragement OF q con-
stitutional protection, the American
people had accumulated the most I'M
pressive collection of inventions of
any nation in the world, and a
premium was placed on labor-saving
devices. A new agency was estab-
lished, not only to discourage, but, in
some cases, to forbid their use.
An entire code of law had been
written to forestan monopolies in
restraint of trade, to put down con-
trols and TO divide combinations. A
new agency dragooned business and
| industry in the opposite directions,
| insisting with the force of eminent
domain on concerted effort in pro-
duction, in production restriction,
in merchandising and in employ
ment.
The structure Of its tax system and
of its governmental services was in
/ f1uenced by its history. The Civil
War brought profound changes. The
World War, reluctantly entered into.
but once emarked upon, prosecuted
with furious vigor, altered the fabric
! Of Government still more and changed
economic conditions. But not even
! the exigencies of the warfares Of q
century and a half, not even the
| conquest of a continent and the build
ing of tremendous population and
wealth, brought forth changes so vital
as those which a period of economic
arrangement produced.
No single book can report fully
what has been done and is being
done. No bookkeeping report OF
money spent is of value for tomor-
row the figures will be different. Even
averages are of limited use. But
principles can be adumbrated and the
methods adopted to carry them into
effect described. This has been done
in simple. fortnight terms. What
J the American Government Of today
T is doing, and why, may be learned
from these pages. All that enduref
of the American Government of yes
terday is described and all that ha
been added to it in the course
the New Deal has been set forth.
. is a record of a creation and a pic
ture of a new body polite and II
| instrumentalities. - The America
! Government Today.
| tCopyrignted by Frederic ]. Haskin)