Evening star., 1935-06-09
Modest Alternative Urged
by President Roosevelt
Proves Anti.CIimax.
SANER JUDGMENT TAKEN
OF ULTIMATE EFFECTS
Merchants and Manufacturers
Hold Back Commitments Until
Outlook Is Clearer.
BY CHARLES F. SPEARE.

NEW 1ORh, June o-1 He HiOueS'
alternative proposed by President
Roosevelt for the N r. A. proved to
be an anti-climax to period OF pas
sionate debate indulged in by those
who were certain that he would sug-
geSt vigorous measures to balance
what had been lost to the New Deal
by the Supreme Court decision.
AS it now stands. the N. r. A. Is an
emaSculated and ineffective lnStru-
ment for policing the business world.
The administration has. in erect,
given back to industry and commerce
the right to set its own pace and It's
own standards while keeping within
the letter. as we'll as the spirit, Of the
antitrust laws.
The issue growing from the Su-
preme Court decision has become po-
litical rather than economic. Its
most significant phases will appear
later in the year and probably set the
pattern for party platforms IN 1886.
The first reactions on business have
been tempered by saner judgment OF
its ultimate effects. Demoralized con-
ditions in sections OF the retail trade.
where price cutting Immediately be-
came violent, have been succeeded by
comparative calm. The 5-point aver
age decline in stocks has been par
TALLY recovered and the drop in
Treasury obligations has been
checked. Commodities have i'm
proved from the most abrupt slump
in months.
There is. however. less disposition
on the part of merchants and manu-
facturers to make commitments until
they have a clearer idea OF how the
new industrial freedom is TO affect
them and how far the threats Of la
Dor troubles will involve them.
Permanent Standards Sought.
President Roosevelt displayed good
political sense in not insisting on
new set-up to replace the N. r. A.
and its system Of irritating codes and
in allowing business to proceed along
voluntary lines toward the recovery
that 1t desires. At the same time he
has maintained the principle of So
cial justice in respect to all contracts
in which Government purchases or
Federal aid are involved. This sets
an example which the President hopes
will be followed by industry and will
make permanent standards of busi-
ness conduct that never would have
been established under the former
method of wage and price cutting.
The parts of the pyramided Struc-
ture collateral to the N. R. A. that
do not offend those operating under
it and appear to be for the general
good, should be salvaged. Among
them are the acts relating TO the su-
perviSion of trading on the exchanges
of the country and controlling the
issue of new securities. 1t would be
a tragedy TO restore to Wall Street,
to La Sale Street or to the financial
centers of Boston, Philadelphia, Los
Angeles and San Francisco the priv
ileges under which they functioned
exchange law.
Few among those who are now
in control of these organizations
would prefer the old to the existing
codes of conduct. Certainly the in
vesting public would soon demand
that the rules surrounding dealings
in listed and unlisted stocks and bonds
again be made effective, If they were
thrown overheard.
Farm Policy Under Fire.
The fate of the A. A. A. is in the
balance. though it is not directly af-
fected by the Supreme Courts de-
cision. This agency of the Govern
ment is most vulnerable to attack. for
it runs counter to the great mass of
consumers, who have little sympathy
with the producers because of their
lack of understanding of the latter'S
problems.
Compared with year ago, beef is
40 per cent and pork over 25 per
cent higher, per barrel, with retail
prices of all meats 18 to 48 per cent
above the figures of last June. The
receipts of hogs at 20 primary mar
kets so far in 1885 have been about
as per cent under those of 1884. 1t
10 cSeAtIinCCo blidt bIlC PiotCoShAS 10 -
averages about $3.50 per head for
hogs.
We are a long way from "36-cent
wheat" and scent cotton" which
President Roosevelt has implied might
result from the breakdown of the
N. r. A. The conditions that COM
PEELED the liquidation Of wheat and
cotton two and three years ago have
been in considerable degree removed.
With the aid they have had from the
Government in the form of loans on
crops, lower interest rates on their
mortgages, the opportunity now Of
tered to borrow for one year at 31a
per cent, and with the great improve
ment in their local banking situations
and in the purchasing power of con-
sumers. producers could carry on
without the crutch of a Federal
agency.
Whether or not the A. A. A. ceases
to function, the tendency of COM
modify prices is a rising one for the
next few years-which does not mean
serious inf1ation-and from this con-
dition the producer will automatically
benefit. For the present the trend
may be lower, though there has been
improvement over last week.
Dividends Show Increase.
Iron and steel production still de-
clines. 1t is now under 40 per cent
of capacity, compared with over 81
per cent year ago. Steel manufac-
turers, however, paid out in dividends
last month over 100000, against
81 900 900 a year ago. All corporation
dividends in May were Is per cent in
excess Of those for the period in 1884.
(Copyright. 1895. by the North American
NewSpaDer AlliAnce. Incl