Evening star., 1935-09-07
BREATHING SPELL
NOTE INADEQUATE
President Held to Have
Merely Waved Aside
His Critics.
RY DAVID LAWRENCE

President Roosevelt says there's a
''breathing spell'' ahead for business.
This is not merely a tacit admission
that the administration by Its reform
program has been doing a bit OF drastic
strangling, but that after the -commo-
ton dies down somewhat the strangu-
lation process will be resumed.
An exchange of letters such as the
President had with Roy w. Howard,
head of the Scripps-H Howard chain OF
newspapers, isn't just an accidental or
casual affair in which letter is dashed
off in reply. There is reason to be-
1ieve that Mr. Roosevelt gave con-
siderable thought to the drafting OF
the answer and regarded it as of i'm
portance to the present public opinion,
which, in so far as newspaper edi-
torial criticism is concerned, has shown
signs of much more hostility than the
President has had since the beginning
of his term.
Mr.. Howard's letter was we'll ex-
pressed, but, of course, was not as
detailed as it might have been in tell
ing Mr. Roosevelt just why through
out the country many business men
who once gave you sincere support
are not now merely hostile, but
frightened" The publisher pointed out
that many of these men whose patri-
otism and sense of public service will
compare with that of any men In
public life have become convinced and
sincerely believe that you fathered a
tax bill that aims at revenge rather
than revenue"
Really Want Adjournment.
But Mr.. Howard said those men felt
there could be no real recovery until
the fears of business have been allayed
through the granting of a breathing
spell to industry, and a recess from
further experimentation until the
country can recover its losses" Is
that what most business men really
feel? They not only want a recess
for the experimentation but an ad-
journment. They don't want a re-
sumption after breathing spell, be-
cause they believe many Of the ex-
periments have been unsound and eco
nomically disastrous.
The President didn't really answer
Mr. Howard's points, except to wave
aside the critics as being unneces-
Sarily Skeptical or selfish or perhaps
just confused because the administra-
ton hadn't made things bit clearer.
Comparison of the text Of the PreSi-
dents letter with his radio address OF
September 80. 1884, just before the
congressional election, will show that
it is much the same in tone and spirit.
1t comedies no mistakes, blames the
business men for being too reactionary
to understand progreSSiviSm, and COM
pletely omits the one big thing that
business and industry is worried about
and wants to have cleared up as
quickly as possible-namely. the con-
dition of the Treasury of the United
States.
Breathing Spell Wanted.
II the business men want a breath
ing spell, they want it very largely on
unproductive and unwise expenditure
or upon the use of public funds to
build up Government corporations
that compete with private industry.
Just this week Secretary Morgenthau
attempted to prove that the Govern
ment was operating within the
Presidents budget" and that the def
cit this year wouldn't be $4,000, ,000,-
900. but possibly about s2,500, ,000, 900.
Deficits of a mere two and a half
billions do not seem to worry the off,
cials of the Roosevelt administration,
and particularly the President, who
apparently doesn't care to take note
of the severest criticism which Is be-
ing made against his regime.
1t is amazing also to find the Pres
1dent saying that lit is a generally
accepted fact that larger corporations
enjoying the advantages Of size over
smaller corporations possess relatively
greater capacity to pay" The very
opposite doctrine is generally accept
ed. For large corporations are owned
by many tens of thousands of stock
holders, whereas the smaller corpora
tions earn much larger percentage
on their capital invested and distrib-
ute profits to few. It must be that
the President has not read the wave
OF criticism which has met the first
exposition of his tax-the-big theory or
that he prefers to ignore it. Well, in
the coming election the small stock
holders whose dividends are to be
affected by the tax will probably seek
to make their position felt, and al
ready there are signs of Nationwide
organizations of stockholders to fight
the attempt to discriminate against
them because they own a few shares
In large corporation.
Weakness in Statement.
Perhaps the weakest statement in
the Presidents letter is his comment
on reasons why Congress declined to
broaden the tax base. Here is an
extract from his letter which is
bound to plague him in the years to
come:
THE broadening of our tax base
In the past few years has been very
real. What is known as consumers
taxes, namely. the invisible taxes
paid by people in every walk of life,
fall relatively much more heavily
upon the poor man than on the rich
man.
I'm 1929, consumers taxes repre-
lcSh1SA oAiAy ~ Pei CCAlG VI tl4C A1de
tional revenue. Today they are so
per cent, and even with the passage
of the recent tax bill the proportion
Of these consumers taxes will drop
only per cent"
Thus we have an acknowledgment
that the soak-the-rich bill didn't
help the poor man at all, that the
poor man has had his taxes increased
gradually till today he is paying in
directly about so per cent Of the
taxes collected. But the President
omitted to explain that almost the
biggest item In these consumer taxes
are the processing taxes on bread,
and meat and clothing, and the
necessities Of life. And, 1t might be
asked, are the American people to
be expected to continue to pay these