, 1935-05-14
WASHINGTON
Rv Raw Tucker

policy on THIS Newspaper.
WASHINGTON
BY Ray Tucker
Piea-The biggest backstage bat
tie In Washington revolves around
the move to force financial reorg-
anization of the railroads. Its i'm
plications and the elements in
volved make II a more important
set-to than the quarrel over the
banking and holding company bills.
Senate liberals insist the railroads
must go through the wringer"-
meaning that they must scale down
their fixed charges as represented
by bonds. The scrap really revolves
around the Wheeler resolution TO
investigate the bankers handling
OF the Missouri Pacific. Senator
Wheeler believes such IN inquiry
Will show that the road was loot
cd by the financierS. His resolution
passed the Senate easily enough but
for some reason has been held up
In the Senate Audit and Control
Committee which authorizes ex-
penditureS.
The investigation may be COM
paratively unimportant IN itself.
But Mr.. Wheeler figures 1t will
furnish publicity and set the stage
for bankruptcy act amendments TO
compel organizations. He hopes II
will bring the railroads TO time as
the Pecora inquiry resulted In Gre
alton Of the Securities and Exchange
Commission. Some railroadS-not
all-are putting up a stiff fight
against his plan. They urgently
plead TO be left alone and allowed
to save themselves IN their own
way.
savers - Secretary Morgenthau
Wa referring TO big money when
he declared that refundtng opera
tons reflected a break in the fin
ancial log jam" But there r in
oications that the average citizen
is beginning to loosen UP with his
small change.
Postal Savings deposits provide
the clearest test Of the average
mans fears and fancies with re-
spect 10 investments. Just before
the 1888 bank holiday they reached
the unprecedented total OF Si,206,-
100000. Frightened money flew from
banks TO the Post Office. They re-
NAMED near that figure until this
February. Now they have begun TO
drop for the first time. They reach
ed 81 202. 900, 900 in March and un-
tabulated April figures may fall
much lower.
Three factors are responsible.
Government guarantee Of bank de-
poSits is teasing Postal Savers back
to the banks. The 90 per cent I'M
derwriting Of home building and
financing mortgages Is tempting
them to seek a more profitable use
for their money in building and
loan associations. and baby bonds"
paying 20 at l0-year maturity are
attracting this type Of investor.
Grief-The Tennessee Valley Au-
thority has been caught-Quite in
nocently in several embarrassing
pastures recently. While President
Roosevelt and the chamber Of COM
merce were staging their duel. iva
was canvaSSing chamber of COM
merce officials for a man TO head
It's industrial division. While New
England interests were complaining
Of the textile trek TO the south, the
iva was accused Of urging middle
western corporations TO move from
Ohio to Tennessee.
iva officials say all they want
T. a man to handle the manufac-
turing and marketing facilities for
industries native TO the valley where
they are providing cheap power
ceramics. handcrait and weaving.
They deny that they are soliciting
factories to move from their present
location to the vicinity OF Norris
and Wheeler dams.
Although one OF the presidents
pet projects, iva may yet cause
him grief. Democratic senators are
the chief portestants against any
program TO shift industry south
ward. They voted for the expert
ment in the administrations early
days but apparently did not discern
its implications.
Delay-Liberals in congress IN
complaining about the slowneSs OF
the Communications commission in
starting the A. II. and II. inveStiga-
ton. They can't understand the
circumstances surrounding choice
Of a MAJ to conduct the $4,000
inquiry.
The commission first selected Max
Gardner. former governor OF North
Carolina and lawyer for the textile
industry In its controversy with the
| AAA. It Is customary to ascertain
In advance whether the appointee
will accept but this was not done
In Mr.. Gardner's case. IL brought
MIN gilt-edged publicity, but he
Immediately resigned - explaining
that he could not afford TO abandon
a Washington law practice which
nets him 100000 a year.
Certain commissioners who favor
another man-an old comrade Of
the President In his power fights at
/ Albany and WaShington-were not
consulted In the selection OF Mr..
/ Gardner and did not know Of his
resignation until the last minute.
They are worried lest the delay place
them in q bad light on Capitol Hill
and at the White House.
Mortgages-Banks that cornered
al the credit machinery OF their
communities are quietly resisting the
Federal Housing ADMINISTRATOR
new system OF mortgage insurance,
| though they dare not fight It openly.
| The FILA holds interest down to
5k% per cent and the banks don't
like II. Mortgages are invited TO let
FILA know whenever bankers re-
fusa 10 lend to them-then the heat
Is turned on. Big insurance COM
panies are swapping up the insured
mortgages and some banks are los
Ing business
Increased construction, both re-
modelling OF old BUILDINGS and new