, 1935-06-26
WASHINGTON
BY Ray Tucker

- AA8y 4aAnG
Closings - Treasury officials are
not advertising 1t but the nation
viii escape by inches a bank crisis
second only to that which floored us
In March 1888. Senate delay on the
omnibus banking bill caused all the
trouble.
The temporary guarantee or bank
deposits expires on June 80. Under
the permanent guarantee plan which
becomes effective on July !, unless
modified, banks are subject to an I'M
limited assessment for losses. They
are fighting this provision and they
have failed to buy stock In the fed
eral Deposit Insurance Corporation,
A. required by permanent law.
But unless they are stockholders
In FDIC before July /, many must
close their doors. Under present law
the comptroller must name receivers
for all national banks which have
failed to purchase stock. The Fed
eral Reserve Board must cancel the
membership Of delinquent state
banks. It's no secret in certain
quarters that the law will be rigid
ly enforced.
Pressure - Bankers have blithely
encouraged Carter Glass In his one
man filibuster against the banking
bill. which would straighten out these
difficulties. But they forgot that its
failure to became law before July /
would impose these penalties. So
did everybody else except a treasury
law shark.
Not until June II did he realize the
danger. Then the government warn
ed banks that they must buy FDIC
stock II they want TO continue in
business after July /. Applications
and checks are pouring into Wash
ington at a hysterical pace. But
some institutions may be caught In
a last minute jam. They may not
get their purchases recorded in time.
III not they must lock their doors
and suffer a tremendous loss OF pres
tige.
A Joint resolution extending the
time for purchase Of stock may solve
the problem. So would separate pas
sage Of Title ] OF the banking bin,
NAAAGAA AGAalNo ~ O4AAh uNUOrAA0 AlAA
reduces the banks liability. But sep
arate enactment Of Title I might
weaken the pressure for Title III,
which Mr.. Roosevelt wants. So far
the president has not placed the
joint resolution on his must" list.
He seems content to let the banks
suffer. 1t may help to pass the bin.
Report - President Roosevelt has
personally assumed charge u head
ing up the A. T. g. T. investigation.
He has informed friends that he in
Sists upon a grass roots" inquiry.
The affair threatened to become
a political foot ball - or punching
bag. The communications cornmis-
sion has been torn between the de-
sires Of liberals" and "cOnserva-
tiveS'' on that body. One group
wants a thorough-going probe. while
another breads q smashing. Fecora-
like investigation. For q while the
conservatives ruled the roost. Moth
ing else explains the strange and
sudden rise In "A. Il. a. It. stock for a
few days ago.
There should be action within n
few days - perhaps before this Is
published. The choice OF counsel
and the president is picking him
will reveal how hard and high the
inquiry will hit. Mr.. Roosevelt wants
q full report on his desk by July /,
1886. 1t may be juicy campaign ma
terial. Then again. II may not be.
That's why he wants it SO early.
Cuts - The Federal Housing adj
mintstration has been a conspicuous
New Deal flop. II has fostered COM
paratively little building. It's inter-
est rates, ranging from 6 to z per
cent and more. hardly inspire home
owners TO transfer their trusts from
banks and insurance corporations.
Acting Administrator Macdonald
will announce a reduction OF inter
est rates 10 5 per cent before long
Now that the work relief fund Is to
be allocated to glorified b~oOn-dog-
Cling the administration will bank on
government financed home building
TO get us out of the red.
The real meaning Of the interest
slice goes deeper. Mr.. Roosevelt has
been urging and suggesting that in
terest rates be slashed all along the
line. The treasury's refinancing Is a
notable example. But John @. Cit
lion hasn't got Mr.. MOrCenthau'S
drag. He is still paying 6 per cent.
The FILA move will be tine first OF
several designed to force down the
Il hire mira NJ other ~paOp1pfe mOuav
Wealth - Mr.. ROoseveit's propoS-
al for surgical taxes impreSses I'M
informed congressional leaders and
the uninitiated layman as a politi-
cal gesture. Supposedly slrewd OBJ
servers attribute it to a desire 10
head off left-winging share-the-
wealth apostles like Huey Long.
These people are fooling them