The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1935-05-11
WHERE THE SPENDING SPREE IS
LEADING THE COUNTRY


Lewis w. Douglas, former national bud
get director, speaking to the National Econ
omy League in New York, said that unless
the Roosevelt administration modifies or
changes its spending policy the country
will be led into national disaster" Mr..
Douglas views were sustained and ar-
proved in a speech on the same occasion
by Senator Willard E. Tydings, Maryland
Democrat. The recognized ability of Mr..
Douglas, his former connection with the
national administration, and his well
known devotion to American principles of
government, make his views enlightening
and arresting; and The Times-News is
pleased to devote some space to a summary
of his New York address:
Mr.. Douglas charged that there was little diff
ference between the Administrations present fiscal
policy and initiation since, he said the Government
was creating fiat bank deposits to meet mounting
deficits. Such policy, he continued, was not diff
ferent save in technical distinctions, from printing
fiat money and it must, unless checked, inevitably
lead ''to the impairment of national credit the col
lapse of the banking system and the destruction of
the middle class
History demonstrates without exception that
whenever a government continuously spends more
than it takes ill., the social consequences tragic,
he continued There is no exception to the gen
eral rule
1--WE printing money to exactly the same ex-
tent that France printed money in 1889; that we
printed money during the War of independence;
that the Bank of France printed money for the
Government in the postwar period, and that Rus
STA printed money during the revolution beginning
in 1927. .-.
There is no logical reason, therefore to expect
here auv experience different from the historic
one"
Mr. Douglas warned the Administration to turn
back, adding, however that eff it has the courage
to reverse its policy it has infinitely greater cour-
age than it has previously demonstrated" 1t had
welded he charged "to pressure for the deprecia-
tion of it's own dollar" which was Inherently
sound, and had been unable to resist pressure fror
groups and classes who were out for special IA
vors."
Such a policy, if continued, would through "the
sheer momentum of social and economic forces
make it almost impossible to avoid dictatorship
'"Thus," he added, "there will have been DESTROY
ed all the cherished liberties the highest treasures
of America. This is not mere fiction This is con-
firmed by experience"
Mr. Douglas quoted figures purportinr to show
how governmental expenditures had exceeded reve-
nue..
Inclusive Of the sinking fund" he said, ''we in
CURED in 1884 Deficit of 5000, 600, 900; in 1892,
deficit of SS15S,OOO, 900; in 1888, deficit of
$3O6SOOO,O0O; in 1884, deficit of SS,966 ,OOO,-
600, excluding gold devaluation profit; in 1885, 4
deficit estimated to be ,$4s57 600, 900, but which
will probably be about 50. 500, 100000, and in 1886
an estimated deficit of $4,5SO, 100000.
"Thus, in six years, the expenditures have ex
ceeded revenues by more than $4,000 600 900
and there is in sight no end to the spending. -
can analysis of expenditures proves beyond PEE
adventure of doubt that, Notwithstanding the re
covery which in some quarters has beeasse Iouai
heralded, the expenditures of nonreturnable char
acter for relief and public works have been con
stantly mounting s
"But more than this, the facts show that tn
bonds issued to finance the deficits have not bee
absorbed by tie public out of savings. On the co!
trary they have been absorbed by the banks. Their
are no differences, except few technical ones, b
tween printing money to. meet deficit and erea
ing fat bank deposits for the same purpose. II
latter is what we have been doing.
"Our situation, however, is not like Great 81
tain's There the Government grimly clngs TO
determined fiscal policy to maintaia balance
budre,SS a ptstsa tiop 70 its currency and as