Evening star. [volume] (Washington, D.C.) 1854-1972, 1935-02-28
BY NICHOLAS ROOSEVELT.

BY NICHOLAS ROOSEVELT.
The improved conditions on the
farms and the greater optimism Of
the city people are reflected in the
increased activity in many lines of
business in the Middle West. Not only
are the mail-order houses doing a
larger volume of business than a year
ago, but department stores, dealers
in luxury goods and many other re-
tail traders report big increase in
sales.
Fully as significant, If not even
more so, new orders for agricultural
implements are coming In at such q
rate that this business, which in 1888
was operating at only about 20 per
cent OF its predepression level, and
last year at 40 per cent, seems likely
this year to exceed so per cent. At
the same time, the demand for paints,
ROOFING and other articles of farm
and house maintenance is growing
rapidly. Even the furniture dealers
In Chicago report a great increase in
business. and the makers of furnaces
and other household appliances are
hopeful of much larger sales during
the current year.
When I asked how much of the i'm
provement in house repairs, renova.
ton and maintenance was attribu.
table to the Federal Housing Admins.
tration, which has been Offering to
lend money to stimulate building, I
was told that the actual volume of
money advanced for this purpose by
the Government was small, but that
the Governments extensive advertise
ing campaign urging people to repair
and enlarge their houses was bearing
fruit in great increase Of privately
financed operations.
Credit Easily Secured.
Not only is money being taken
from the banks for this purpose, but
the suppllers of expensive household
Improvements, such as heating plants,
have been making generous terms,
and in this way have given a distinct
stimulus to building operations. New
housing. however, is as yet restricted
in volume.
At the same time distinct increase
in the sales of rural real estate is in
evidence in the Middle Western
States. A small part of this-notably
in the neighborhood of Kansas City
appears to be due to flight from the
dollar on the part Of wealthy city
people fearing imitation Most of it.
however, Is the result of demands by
farmers who expect and intend to
farm this land
A corresponding improvement in the
sale Of urban real estate is not yet in
rhaYa
rents continue low-especially for
office space-and the urban real es-
tate business as a whole is inactive
and Improbable.
Auto Buying Aids Steel.
The effect of the marked increase
in all sorts of retail business will
probably ultimately be felt in the still
stagnant durable goods industries.
Already the volume of steel output
has increased materially, but this
seems to be due largely to buying on
the part of automobile companies and
the agricultural implement manufac-
turers. The most valuable steady
business-rails and structural steel
is improving very slowly. In general,
| the various types of heavy goods in
dustries still are operating at only q
| small percentage of their capacity and
this in turn is prolonging the unem-
ployment Of millions Of industrial
workers.
With the passage Of time it is now
| clearer than ever that Col. Leonard
Ayres of the Cleveland Trust Co.
| was right when in the early Sum-
mer of 1893 he insisted that the great
bulk of the unemployed in this coun-
try were in the durable goods indus
tries, and that inasmuch as the New
Deal program only stimulated con-
sumner goods industries it would not
strike at the real root Of the trouble.
For expressing these views Col. Ayres
was bitterly denounced by the ad-
ministration 1t Is interesting to note,
however, that even Gen. Johnson,
who in June of 1888 could still be
classed as one of the stanchest New
Dealers, had seen that this diagnosis
was correct and had urged on the
administration a s3,00O,000,000 pro-
gram designed directly to stimulate
the durable goods industries. The
brain trusters, however, would have
none Of 1t. This Is one Of the reasons
unemployment has continued almost
, undated during the last ID months.
New Deal Fallacies.
. The effect of this unemployment
in the industrial centers on the situa-
ton of the farmers of the country
: was long ignored or denied by the
administration theorists. In part for
political reasons the prime efforts
: were made to raise artificially the
! prices of farm products. Only few
agricultural leaders had the courage
and the clear vision-of Dean
Christensen of the Agricultural Col
lege at the University of Wisconsin
to point out that the drop in the
urban pay rolls was the important
cause Of the low prices for such
things as dairy products. There is
little doubt that If the great mass Of
urban workers could afford balanced
diet the great mass of agricultural
production in this country, always ex-
cepting such export staples as cotton
and wheat, could be consumed within
our borders.
| But the New Deal policies followed
the other theory. They sought to
stimulate consumers goods industries
lie, those industries catering to the
retail trade in goods which are con-
sumed in daily life-and not only did
nothing to help the durable goods
industries, but actually handicapped
them in their recovery. This mistake
has largely contributed to the pres
ent size Of the relief rolls. Until the
heavy industries are once more op-
Grating at a normal rate we shall not
have a well-grounded, sound recovery,
nor shall we turn back to self-sup-
port of many millions Of persons now
being supported in idleness by the
Government.
In his final article In this series
tomorrow Mr.. Roosevelt analyses the
conflicting political currents IN the
Middle West today.