Evening star., 1938-04-26

REPRESENTATIVE
Of our people were involved. that
would be sufficient to cause us to ex-
ert every effort to get out Of the relief
business as speedily as possible and
return our workers to private industry.
There Is no question that one Of the
first steps toward Fascist dictatorship
is to break the individual morale by
making every one in need permanently
dependent on the Government. After
that, the other steps are easy.
The argument is made that the ex-
penditure of these huge sums for re-
lief will help business by increasing
the purchasing power. OF course, a
dole. without the burden Of working
would create an equal amount of pur-
chasing power. but offhand I can
think of no one who would suggest
that step which would further break
the morale Of our decent workers.
If the ultimate objective is to get
our unemployed back into private in
dustry-and surely that must be the
goal at which to aim-then every ef-
fort should be made and every en-
couragement should be given to busi-
ness to accomplish this result.
Must Treat Business.
To this end some of us have advo-
Gated the objective of encouraging
business. This may be an abstract
phrase. but with business hysterical,
as 1t surely is. We must treat the pa
tient as We find him.
To re-establish confidence taxes
must be made equitable, legitimate
private business must not be further
interfered with, and the Government
must stay out of competition with pri-
vate industry. Assurances along this
line have been long awaited by busi-
ness and, I regret to say. they have
not yet been forthcoming.
Many persons who have tried to
solve the problem of this depression,
which has now been with us for nearly
nine years. do not subscribe to the
economics Of the "pump-priming TIE
ory that all you have to do to get back
to prosperity is to increase the pur-
chasing power by Government spend
ing.
There are many who believe that
consuming power Is only one corner
OF the triangle-that production and
income are indispensable to make a
complete triangle, with chief emphasis
on production. The latter Is what has
made for the success Of this country.
Nom productive jobs. and the depriva-
ton OF profit, through taxes or other
wise, will never solve our difficulties.
Production produces income and pur-
chasing power. All these 20 together
and production leads the triumvirate.
Some people believe that while there
may be at one time overproduction
IN an individual industry. there can
never be overproduction in all indus
tries. The more there is produced the
more there is to divide The advo-
Gates of the prime importance of pro-
duction contend that the standard Of
living can be raised only through in
creasing total production, not by cur
failing production
People entertaining contrary views
will throw up at us the question, How
are you going to do it?"
Billions Frozen.
In answer to that, let us see where
the resources lie that could be used In
increasing production. First, 1t will
not be disputed that. while the Gov
ernment proposes to spend about 81
500, 900, 900 in pump priming," private
capital has more than 10 times that
amount presently frozen but surely
available, If the right word were given
to go full steam ahead"
There are s24,00O,OOO,OO in our
banks. Our insurance companies hold
SIG, 900, 100000 of assets for our 64,-
100000 policyholders.
From 1920 to 1890 the corporations
of our country financed private enter
prise to the extent of $3,8l7 900 900,
while the Government financing
to only S50s.000,000. In
other words. private capital furnished
over SO per cent of all financing. while
the Government was only required to
supply less than IL per cent.
Contrast this. however, with what
has happened since 1890. The situa.
ton has been almost exactly reversed.
From 1881 through 1887, private CAP
ltal has only furnished about IS per
cent OF all new financing. or $71o, ,ooo,-
600, while the Government has con-
tributed about IS per cent, or s3,e74,-
100000.
Surely there is some reason for this
II it is that fear" we hear 50 much
ABOUT, no one will gainsay but what
that fear should be removed, and at
once.
Would Invite Private Capital.
All that the Government could pos
sibly spend in this crisis is but mere
chicken feed" compared with what
private. venturesome capital used to
spend and still has to spend. How to
get private capital to come back into
the field Is the problem which should
invite the constant and unpreiudiced
.Ao'SAAoAod Va government ana DuSlneSS
Until that is done We are getting no.
where.
Some time ago suggested that we
'ave legal holiday to be called "Stop
Calling Names Day" still believe
that private capital will not be pried
loose until 4 different attitude is
assumed than soak the rich," ere
distribute wealth." down with the
economic royalists.' and take the
profits out of business"
Let's see further where the resources
OF private capital are hidden, ready to
emerge II proper announcement were
given and confidence restored.
1t has been estimated by the Presi-
dent himself that private capital to
the extent Of $4,000, 100000 could be
spent each year on housing.
The railroads need to spend 81, 400
100000 every year to adequately con-
duct transportation, II they could be
A