Evening star., 1937-12-12
New Deal Bewildered
By Recession
BY OWEN L. ScOTT.


with Congressman and ONCE boys in
wondering what, If anything, President
Roosevelt has up his sleeve to turn the
tide Of deepening Oppression.
Some suggestion Is heard that the
President shares the bewilderment and
confusion Of his aides. But those well
informed individuals who have talked
with him say that Mr.. Roosevelt UNDER
stands what has hit business in this
country and knows what he would like to
do about it. Yet political realities make
the doing difhcult
For that reason, from the cabinet on
down, the men who make the wheels 10
round are looking for signs that win
provide an answer to the question:
VIII President Roosevelt now endeavor
to outsmart Congress and business men
In an effort to get even for past grudges?
Or
viii the President now try to find a
common ground on which there can be
meeting Of minds among the conflict
ing groups of the country In the interest
OF attempted recovery?
There Is agreement that President
Roosevelt is in strategic position to
show up his detractors within his own
party ana IN business.
This result could be accomplished by
allowing Congress to founder leaderless
and bloc-ridden before the public gaze,
while ne drove for balanced budget at
any cost and at the same time gave to
business the relief policies and the tax
policies that 1t demands. Out of that
situation could come a deflation that
Wouio oring rather quick and painful
reminders Of 1881 and 1882, followed by
irresistible demands for some new tnfla-
ton.
But the more thoughtful among the
RESIDENTS advisers, including Henry
wallace and Mariner Eccles, are coun-
selling against any such procedure.
Rather, the view of the Secretary of
Agriculture and the chairman of the
Federal Reserve Board is that the time
has come to forget differences and to trv
to see II the warning factions in this
country cannot find a common meeting
ground. Secretary Wallace, in particu-'
lar is specific in his Recommendation
that Mr.. Roosevelt let bygones be by
cones and that he counsel with business
men, labor leaders and farmers to work
out policies on which there can be agree
ment.
This would necessitate willingness on
the part OF the country's business leaders
10 admit for once that something more
tnan lack OF confidence and faulty tax
policy underlies the new breakdown of
the existing economic machinery.
Even so. the basis for q truce and for
agreements that may save the country
from much suffering and strife is begin
ming to be clear
Business men, In the first place. turned
on Mr.. Roosevelt and aroused his bitter
ire, all because they thought he was too
friendly with labor under N. r. A. Yet
today labor has law on the statute
books. upheld by the Supreme Court.
that provides more projections than the
OLD Blue Eagle codes. Furthermore. the
once strongly anti-union steel and auto
mobile industries-which really started
the f1ght-have learned to deal with John
l.. Lewis. That leaves little to fight about
on this score.
1t is much the same in the utility field.
The President all along has been deter
mined to squeeze the water out of the
electric power industry and to provide
that industry with some competition.
Issues in that fight are soon to be passed
upon by the Supreme Court. There are
many signs that the industry rather ex-
poets the court to uphold the Federal
Government. Leaders among utility
executives are deeply interested in a
truce with the President. So another
hight can readily be called of.
Business men did not like social secur-
ity. but they have it, with court approval
They objected to the original A. A. A. for
farmers. Yet the temperance of defla-
ton in agriculture is not pleasing to an
industry that finds a vast market on the
farms. The problem here seems to be to
get control system that will work
rather than to destroy all controls.
Ana business objects to present Federal
Government tax policies. The White
House joins with Congress in desire to
meet those objections at least halfway.
but almost nobody in authority seriously
expects corrections to serve as an auto
matte assurance of recovery.
OF course, many business men want
to get rid of Mr.. Roosevelt altogether
and to have somebody else in his job
Still, the existing President is assured Of
three more years in of1ce, and, despite
a sore jaw, he looks mighty healthy. A
lot can happen In three years. In spite
OF q sudden hero worship of Congress,
business will be surprised II the Senate
and the House provide leadership in the
period ahead.
But, on the other hand, there are
those in business who believe that a
good bit Of deflation in industry now
would debate and destroy the standing
Of President Roosevelt They believe
that this result would be cheap at any
price.
What they need to remember, in the
opinion Of the more thoughtful WASH
ington oficials, is that there are poten-
tialities of imitation here that could be
used to blow the lid from the present
situation, If that became necessary. It
is almost automatic that, the deeper the
dehation, the more certain the imitation
Never was the stage better set for such
a development. And imitation normally
would be followed by a collapse that
could end in way not at all pleasing
to private industry.
There Is every reason, in view of the
described situation, to expect that the
wish Of Henry Wallace for q new CO.
operative approach to the Nations prob
lens will be offered by President Roose-
welt.
If that offer is accepted by business
the first task will be to reach an under
standing about the nature OF these basic
problems. Largely, they have to do with
price-f1xing policies by industry and with
the distribution of the Nations income
Some high-presSure education will be
called for to convince American business
men-as business men of other nations
have lOn1 since been convinnnd-Ah.t