The Western news. [volume] (Libby, Mont.) 1933-current, 1938-03-31
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BY Carter Field -
FAMOUS WASHINGTON CORRESPONDENT IL -
FAMOUS WASHINGTON CORRESPONDENT


for all its citizens. F or an iridivfd-
ual to rush into debt is terrible
thing for all his observation-disclosures
a good thing for his country.
Boiled down, that IS the essence
of the economic theory of a good
many of President Roosevelt's adj
yisers, if not of the President him
self. 1t is shared by no less, for
example, than Mariner Eccles,
chairman of the board of governors
of the federal reserve system.
This sounds like sarcastic criti-
cism, especially to many of the
old-fashioned folks who we're
brought up, whether they followed
the teachings or not, on ''willful
waste brings woeful want" and a
"save the pennies and the dol
lars will take care Of themselves
philosophy. Actually it is as sim
pie a statement of the theory as
the writer has heard.
With plentiful government spend
ing, especially if the money is
raised by borrowing instead of by
taxation, employment is encour-
aged; buying is encouraged;
prices tend to rise, everybody has
a job; and everybody, except the
budget balancing theorists, is hap
Ply.
Example is made Of Great
Britain, which has never paid off the
debts incurred in the Napoleonic
wars, much less any of her enor-
nous borrowings since. At various
stages during the last two hundred
years economists have worried
about this debt Actually, it is con-
tended, Britain is just as we'll off
now as at any time during the proc
ess, and her present ills are not
due to her debt.
Of course, during this two hun
dred-year period described-for it
goes way back of apoleon--some-
thing has happened, which the econ
omists advocating the bigger debt
and bigger government spending
theory do not mention. There has
been a gradual shrinkage of the
value of the pound sterling. But
then, on the other hand, Britain is
often cited as the only important
country in the world which has
never had real imitation. Not an
initiation crisis, to be sure, but her
currency has gradually deprecated.
Which is another way of saying
that the people who saved their
money kept losing a considerable
fraction of it.
Evil of Saving
But there is simpler illustration
of the "evil'' of saving. Let us
imagine that everybody in the
United States was gainfully en-
ployed, and every one saved so
much Of his earnings that the in
terest on his earnings would sup
port him after 20 years.
In a very short period, 40 years
at the outside, assuming no gam
bling element which would lead to
losses, every family in the country
would be able to live on its income.
Theoretically, no one would have
to work at all. Men and women
could just spend their income on
what they wanted, perhaps even
save part of it,
Carrying this absurdity to ex-
tremes to make it clear we would
then be a nation of idlers, living
on our incomes. But who would
provide the food and clothing and
automobiles and radios for our pop
ulation?
To make the point still clearer,
imagine a tariff wall around the
United States SO high that there
would be no international trade.
What would happen? Obviously de-
mand being very high, and supply
being very low, prices would soar.
What would amount to a capital
levy would thus be eeeasiened, and
the accumulated savings would be
wiped out. Everybody would 60
back to work again.
Now assume a little bit of this
instead Of a wholesale dose, and you
have a depression. Reverse it,
with everybody spending his head
off, and you have boom. In nut
shell, that is the theory, with the
addition that If the individual doesn't
spend, the government must.
Guffey Starts Something
Senator Joseph F. Guffey of Penn
sylvania certainly started some
thing when he named the issue on
which he intended to support Thorn
as Kennedy and oppose Charles Al
vim Jones in the Democratic guber-
nawtorial primary in the Keystone
state.
Guffey is supporting Kennedy for
three reasons. One is that Ken
nedy has always regarded Guffey
as his leader-has followed him in
every important fight for MANY
years. A second is that in support
ing Kennedy. Guffey continues his
alliance with John 4. Lewis, who is
Kennedy's real chief, for years in
labor activities, now in politics as
well. And a third is that Jones,
who won the regular Democratic or
ganizatien support, has always been