The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1936-08-27
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National Topics Interpreted - I114MalA1EA1
by William Bruckart TTMlllllN
Washington, D. c. &<CHsfItMf
No Neu
Tax Leuies

be no new levieS
nor tax increase by the next con-
gress. He chose to get his views
to the public by staging a confer
ence at the White House the other
day when he summoned Chairman
Harrison of the senate finance COM
mittee and Chairman Doughton of
the house ways and means COM
mittee for a breakfast meeting to
discuss the subject. He followed
this almost too quickly by releas-
ing a statement, a letter from Sec
rotary Morgenthau that substantial
ed the spoken word of his two con-
gressional leaders.
But somehow the word from the
White House prompted many OBJ
servers here to pick flaws in the
announcement; they began at once
to find several places in the new
picture that appeared to have been
stneared over by the paint brush,
and, in addition, there was a sud-
den yelp from the Republican ma
tional committee which did not help
Mr.. Roosevelt's plans to show the
country that the tax burden had
reached its peak.
The Republicans were quite harsh
because they called attention to the
fact that Mr.. ROOSEVELT on three
previous occasions had assured the
country there would be no new
taxes, and that in each instance
new tax legislation somehow or 9th
er had been enacted by congress.
Aside from the presidential dec
laration that there would be no new
taxes nor increases in the present
levies and that there would be a
study of the general tax structure,
the President made the point
through Secretary Morgenthau's
letter that there were a good many
hundred millions in recoverable
assets" He also urged upon the
country that business has improved
so rapidly that additional federal
income may be expected from the
present tax rates. This latter, of
course, is true providing business
holds its own or moves to higher
levels but it is with respect to the
recoverable assets that many ques-
tons now are being asked. For
the sake of clarity, it may be ex-
planned that the recoverable assets
to which Mr.. Roosevelt referred
consisted of the loans of federal
money by the various emergency
agencies for relief and recovery
purposes. There are the millions
loaned by the Reconstruction FL
nance corporation; the equally
large amounts loaned by the Works
Progress administration and the
Public Works administration to
states, counties and cities for relief
or for job-making construction. In
addition, there are loans by the
Home Owners Loan corporation,
the Federal Farm Credit ad-
ministration, loans for crop produc-
ton, for marketing and countless
other types. These are all carried
on the books as recoverable assets
and their total may amount to as
much as $4,000, 900, 900.
The policy of the New Deal ad.
ministration is to consider these al
their face value. 1t is the claim
of the White House consistently that
these loans will be repaid and that
they can be used to retire an equal
amount of the national debt, which
indeed, is true if the loans ever are
repaid.
So, whenever the New Deal is
called on to defend itself against
charges of imposing a gigantic bur
den of tax or an equally gigantic
burden of public debt, its spokes
men attempt to demonstrate thai
the public debt figure as well as
the taxes must be considered il
their relationship to these recover
able assets.
To explain the Roosevelt position
further, one may recall that {
month ago when the public deb
reached the staggering total of $33,
779, 100000 the Treasury secretary
contended in a public statement tina
against this sum there should b.
offset the cash assets in the gen
eral fund of the Treasury, then to
falling 1851, 900, 600 and the $4,000,
600, 900 of gold that is sterilized il
what is known as the exchange ster
ilization fund.
"In addition" Mr.. Morgenthal
added in his statement, "we hav,
certain assets representing obliga
tons due us upon which the Treas
ury will realize cash and which viii
ultimately be available for debt re
tirement. These recoverable asset
millions to home owners, to farm
ers, to railways, to banks and in
surance companies, to states, ant
cities-now total more than 1000
O00, 900. These three items-cash o.
hand, sterilization fund and recov
cradle loans-provide an Offset G
So, 75O, 900, 600 to the $33,779, 900, 90
public debt"
It thus is made to. appear direct
ly in issue how completely tn
Roosevelt administration calculate
using these recoverable assets i
retiring the public debt. Havin
gone so thoroughly on record, it
difficult to see how there could hav
been such mistake made as d.
veloped from the White House COZ
ference on taxes. / refer to tn
inclusion in Secretary Morgenthau'
letter of a reference to the recover
able assets as one of the reason
why no new taxes will not have
be levied. Some critics have state
boldly that the White House STATE
ments on the recoverable asset
cannot be justified. Their assertio
is that if the Treasury properly il
cluded recoverable assets as a thin
to be used in offsetting the publ
debt, then by the same token thos