The Waterbury Democrat., 1938-02-01
. BEHIND ! THE SCENESI WASHINGTON wY RODNEY OuTCHER-a
 Democrat Washington
 Correspondent
Business New Deal Fight Sees
 Both Sides
 A Winner

Washington, Feb. l Despite all the confusions and contradictions which continue to aff1ict everyone concerned with the recent White House conferences and utteranceS it is possible to brush enough debris out of the eyes to see certain ele ments of change in the government business situation.
 In trying to peer into the fut- ure, which has become increasing ly difficult, most observers fail to assay developments of the imme- diate past.
 The conflict between the admin istration and Big Business" which will continue regardless of confer ences and cooperative gestures, has produced victories or gains on both sides. The most notable business gain has been in the field of taxa tion. The House bill modifying the corporate surplus and capital gains taxes is painful to RooSevelt's less conservative advisers, ana it IS likely that the Senate will lean even further toward demands for drastic notifications or repeal.
 But some of the uppermOSt and innermost New Dealers, although chagrined by the tie up of the Roosevelt program in Congress and recognizing the seriousness of the depression, insist that on the whole they are well pleased by events and trends of the first weeks of 1888.
 The vociferous demand of Bal ance the Budget" - which was a potent slogan for Roosevelt'S op- ponents-has not been heard at all during the recent White House con- ferences with business men. Secretly the President feels he has convinc- ed certain captains of industry and finance that he can beat them in any name-calling contest, and that his popular following supports him in any attack on big business. Death Sentence" Awe Dies
 Notable progress is claimed for the New Deal power policy. Despite all the furore over the Presidents sub- sequently modified suggestion that all holding companies should be abolished, the net result is a rather striking change of attitudes.
 The celebrated death sentence" in the public utilities holding com pany act now seems relatively mild to the business community. | The IVA issue has shifted to question of how the government will buy private power facilities. The drive to shoot down IVA has sagged, in other words, and now the question is simply one of ex- banding IVA.
 Since most of the simon-pure New Dealers believe that the power fight" is more important than ever, these developments and recent Court decisions favoring administration power policies elate them consider ably.
 Like Reeds Appointment
 Two liberals have replaced two con- servatives on the Supreme Court and a definitely liberal majority holds sway.
 That it is easier to appease con- servative anti-New Dealers than it was late last year was indicated by this groups qualification over the appointment of Stanley Reed instead of some radical" Reed, fer all practical purposes, was just as New Dealish as anyone the President could have appointed.
 Further, the New Dealers are convinced that the price cut in steel for which they have been driving is now inevitable, and Roosevelt has joined in the cry that there must be no wage cut when that comes.
 New Deal optimism such as that rests mostly on the belief or hope that the country will climb out of the depression. Some officials are more hopeful than others, believ- ing that the administration will spend as much money as may be necessary to do the trick.
 Lewis Backs Up
 There are signs that the recent raprochement between John L. Lewis and the House of Morgan through the person of Thomas w. Lamont is not flourishing.
 Lewis has been told by friends in the administration that an effort has been made to "use" him by persuading him to declare against steel price reduction be- cause of its possible effect on steel wages. Lewis is now advised that this places him in weak position to battle against wage cuts when the steel price slash, which New Dealers regard as inevitable, comes to pass. Much better his position, he is tcld, if he stands with the administration and insists there must be no wage cut regardless of what happens to prices.
 This advice has impressed Lewis,