Evening star., 1935-03-24
Opinion Growing That the New Deal
Is Now Working at Cross Purposes

at present Is that which contends
that recovery will come If only the
Government will end reforms.
Economists say that the governing
wheel Of capitalism is the free market
place. When the system gets into
trouble, competition works out the
kinks and sets it to functioning
normally again. This competition is
worldwide. or supposedly so. It has
served effectively in all past de-
preSsions
But this time all kinds of obstacles
have been put in its way. Nations
in trouble sought to avoid the pain
of adjustments under capitalism by
leaving the gold standard and manip-
ulating their money They set up
tariffs and quotas. When that hap
pened, the normal functioning Of cap
italiSm was upset. The United States
joined in that game
Then the same thing happened in
side the country. When capitalistic
adjustments became painful for banks,
railroads and insurance companies,
the Reconstruction Finance Corp.
was set up under President Hoover.
When agriculture no longer could
stand those adjustments without
anguish, the A. A. A. came into being
to bolster prices by cutting surpluses.
When industry found the going too
rough. N. R. A. was wheeled into
line to bolster up the price structure
and ease the pains of competition.
All those moves merely served TO
check the adjustments that competi-
tive capitalism was making to get the
machine back into balance so that
1t would function normally. They
were made necessary because that
normal functioning had been upset
by monopolistic controls in industry
and IN labor. Thus, many industrial
prices held high during the depres-
sion while other prices were being
adjusted. They were held high by
throwing millions of men into the
street, cutting production and pro-
noting scarcity. Similarly some wages.
as in the building industry, were held
high. Interest rates were held high
What the New Deal did was to try
to give a oOse of the same medicine
for the whole system. If scarcity
was good for some monopolfStic
groups, so tie reasoning went. it must
be good for ALL The result is the
elaborate machinery that the coun-
try now sees, constructed for the pur-
pose OF making things scarce so that
prices can be held up.
Confidence won't correct the NAL
adjustments that caused the 1929
breakdown and have gone incorrect
ed since. There was plenty of con-
fidence in 1929 and in some periods
OF the years following, but it did not
clear away the distractions to COM
merce that had been built up.
What will serve to clear them avav?
That is an unanswered question. A
multitude OF plans are Matching here.
They range all the way from schemes
to force competition, by breaking I'D
monopolles. to State socialism where
there would be little competition. But
none OF them assumes that the system
will work suddenly and automatically
If the Government simply steps aside.
Many persons think the New Deal
is working at cross purposes and is
not getting any place. All are won
dering what the Presidents next move
will be In attempting to cut through
the present confusion. Without a
move, trouble may be hard to avoid,
as panacea artists offer the people
their products.
(Copyright. 1891