Evening star., 1937-11-14


factor of the session-the degree to
which Congress is willing to accept
the Presidents ideas.
A majority Of Congress, and even
majority Of the Presidents own party
In Congress, do not think habitually
as he does. But for upward of three
years Congress was willing to accept
measures as written by the Presidents
advisers. That condition came to an
end on . date that can be identified
exactly. 1t was February last, the
day when Mr.. Roosevelt sent to Con-
gress his measure to change the Su-
preme Court. From then on, until the
regular session ended in August, Con-
gress was increasingly an independent
body.
Since August has anything hap
pened that would increase the Presi-
dents authority over Congress?
Hardly. The one conspicuous event
in this field since August was the tur-
moil over the appointment of Mr.
Black to the Supreme Court. That
was hardly likely to increase the Pres
ident's prestige
What President Roosevelt says to
Congress in his address during the
coming week, and what Congress does
during the session, will inevitably be
influenced largely by one condition,
the business recession.
Cost Of Living High Now.
The recession in which the country
Is now involved is not comparable to
the depression in which Mr.. Roosevelt
took office on March 4, 1888. The
present recession ought not to become
anything near so serious as that. The
difference between the two economic
phenomena is measured by the dis
tance between the two words, "reces-
sion" and depression. Nevertheless,
the recession Is serious matter for
the country and for Mr.. Roosevelt.
This recession comes at a time when
cost OF living is high, while In 1888 the
cost OF living was low. This recession
comes at time when the national
debt is about 36 billions, while the debt
in 1882 was only % billions.
What will Mr.. Roosevelt propose to
do? Before this recession came, or at
least before Mr. Roosevelt and and
the country were aware of it, Mr..
Roosevelt seemed determined to bal
ance the budget He did not say so
directly himself, but some of his
closest and most highly placed ad-
visers said it, presumably with MIR.
Roosevelt's approval. Balancing the
budget had been half predicted, al
most half promised, each year since
Mr.. Roosevelt became President. In
deed, the semi-predicting and semi
promising began before; it began dur
ing 1882 when Mr.. Roosevelt was a
candidate.
Balancing the budget, as everybody
knows, means simply spending no
more money than the Government
receives in taxes. Let us see how
this possibly is affected by business re-
cession
ssA0s W ASO Will JODCSS.
Business recession means more per-
sons out of work. If Mr.. Roosevelt
sticks to his frequently announced
policy that the Federal Government
should see to it that all unemployed
are cared for-if Mr. Roosevelt sticks
to that policy, more unemployment
means more money paid out of the
Federal Treasury.
At the same time business recession
means a smaller amount of money
received by the Federal Government in
taxes. For diminished activity of gen.
eral business means less profits, and
it is out of profits very largely that
taxes come.
Obviously, most obviously, dimin-
ished receipts by the Federal Treas
ury, accompanied by increased de-
mand upon the Federal Treasury,
does not mean balanced budget. It
means the opposite. If the admin
istration is to stick to its policy of
having the Federal Government re-
sponsible for taking care of unem-
ployment, and if the money for that
purpose does not come in other taxa
ton. then the only answer is more
borrowing.
Borrowing" incidentally, is hardly
the correct word for the way by
which the Federal Government gets
money. 1t does borrow some, but
the more exact word for the source
of much of the Federal Governments
money would be manufacturing. :"
The Federal Government, in effect,
creates new money by printing Gov
ernment bonds. Whatever the word,
the borrowing Of money or the Great
ing of new money, or both, comes
to the same end. It means larger
Government debt. 1t means still larger
Government debt at a time when
that debt is already larger than ever
In the country's history.
Imitation Can Be Avoided.
More Government debt, every econ
omist tells us, is the path toward
one form of imitation, toward higher
prices for practically everything. Now
ana recently, when prices have been
going down rapidly, one frequently
hears that the prophets who have been
predicting imitation are being proved
wrong. The present and recent course
of prices has been in directly the oppo-
site direction from imitation. Never
thelesS, I imagine that most of the
economists who have been predicting
imitation would say we are a little
nearer to the condition now than ever
before. Yet let no one conclude posi-
lively that imitation and high prices
are certain. It is always possible
that the world, including America,
might take the path back to economic
and fiscal sanity. II America is to
take that path, we should find it
pointed out in the address Mr.. Roose-
welt makes to Congress in few days
President Roosevelt, in calling the
coming extra session Of Congress,
mentioned measures which he espe-
cially desired Congress to pass. Let
us see how these proposals. and the
prospect of Congress enacting them,