Evening star., 1938-04-10
President Is Beset With
Conflicting Advice
BY, OVEN l.. SCOTT.

1ronted Win an increasingly nOStlle ana
unresponsive Congress.
Any understanding of the Presidents
recent beWilderment and inaction in the
face of deflation much more violent
than that of Mr. Hoovers day calls for
realization of those facts. A glance
backstage quickly provides an explana-
ton for the Presidents bewilderment
and inaction.
Yet the same Glance reveals few signs
that Mr.. Roosevelt is prepared finally,
to make up his own mind on the basis
of what is being told him. The choice
Of courses he faces is clear and his &C
ceptance OF renewed spending an almost
inevitable conclusion.
The first choice is offered by what
might be called the Jack Garner, Jesse
Jones and Henry Morgenthau school of
thought. 1t is essentially the business
mans viewpoint.
Mr.. Garner expressed its philosophy to
the President in the remark: You must
give the cattle chance to put on fat"
BY this remark, the Vice President meant
that the cowboys of Government should
let business men Craze on the national
domain in peace while they put on some
financial fat. The idea is that, if there
is to be more whip-cracking and herding
by the White House cowboys, it should
be delayed until after the business ami
mails have more flesh on their ribs.
Translated into terms of policy, the
advice of these counsellors is to sit out
the depression.
Repeal the surtax on the undistributed
portion of corporation earnings, reduce
the tax on income from the sale of capi-
tai assets, forget about wage and hour
laws, stop making remarks that are re-
garded by business men as unfriendly,
put muzzle on John L. Lewis, if posi-
BILE, and damper on the National Labor
Relations Board, and, in the opinion of
this group all will be well.
They go farther
Their advice to the President Is that
all of the rapidly accumulating plans for
using Government resources to haul the
country out of its depression are so much
clap-trap.
Any return to pump -priming-regard-
less of its disguise-this time would be a
far different proposition from what it
was in 1888, they say Many more bill
lions now would be required to get results.
The national debt is $4,000 ,O0OO 600 in
stead of $40 900 100000 Taxes have been
raised to extreme heights without pro-
viding revenue to meet all requirements
in as prosperous year as 1897 SPEND
ing never did result in full recovery and
the country's economic set-up collapsed
just as soon as income and outgo got
fairly near to balance.
Just make loans available to business
men, keep the railroads from collapslng
let the new Housing Act get in its work
and-according to this group-recovery
will follow.
All of this fits in with what its dis
paragers call the "trickle theory" That
theory is that. If those at the top of the
economic scale are taken care Of. some
of the benefits will trlckle down to the
remainder of the population.
In general, President Roosevelt has ac-
cepted this advice since the start of the
new depression.
The President has not resisted the IN
cllnation to take occasional pot shots at
those who oppose him and he has fought
for his plan to reorganize the Govern
ment.
But he has not opposed tax law
changes. He has talked with hundreds
of business and financial leaders in an
effort to find some basis of cooperation,
only to discover that these leaders were
possessed of amazingly few fertile ideas
He has sat on the sldelines while unem-
ployment increased. indexes went into
nose dives and the public generally de-
veloped a growing concern. He shaped
his program to get Congress out of town
by mid-May.
Yet conditions have done nothing but
go from bad to worse. So, on his recent
return from Warm Springs, Mr. Roose-
velt was confronted with renewed as
sault from another group of advisers.
They offer the President another
choice. This is the choice of the Mar
riner Eccles, Henry Wallace Harry Hop
kins school Of thought. There are divi-
sions OF opinion within this group, but,
essentially, their position is this:
The trlckle theory simply will not work
Business in the first three-quarters of
1887 was overconfdent. Profits were
larger for many companies even than in
1929. The Government cowboys had not
run the fat off industry. The difficulties
that this country faces are fundamental
and cannot be solved by a return to
LalSseZ-faire. There will be no real re-
covery, regardless of palliatives, until the
Government steps in with well-planned
and aggressive program OF positive action
This does not mean pump printing on
the pattern of recent years. 1t does mean
any kind of action that is required to get
large-scale activity in the housing indus
try. 1t means action of whatever kind is
required to straighten out the railroad
industry and to revive its buying or leas-
ing of huge amounts of equipment. 1t
calls for peace in the utility industry and
for spending by that industry. 1t involves
some important changes in the Nations
banking system and in its policies
Up to this point there is agreement in
the Eccles, Wallace, Hopkins school,
They have the almost solid support of
the Governments leading economists.
But then a divergence occurs. Eccles
and Wallace think that some way must
be found for Government and business,
particularly the five or six major indus
tries, to determine what causes the basic
Embellishments that result in depres-
sions and then to agree on policies to be
accepted by these industries that can
help to remove those causes
Hopkins, on the advice of his economic
consultant, Leon Henderson, objects to
any kind of planning that might re-
semble modified N. R. A. His view,
which has appealed to Mr.. Roosevelt, is
that Government in some way should