Evening star., 1939-08-07


structive step has been taken to
structure so that it will not be de-
pendent, as it is today. on billions
of dollars of Government loans,
grants and subsidies.
Although in the last few minutes
of play, so to speak, Congress did
exercise a bit of self-restraint by
not adding one or two billion dollars
more of appropriations, nothing was
done to re-examine the whole budg-
. ct and the whole unemployment
situation with an idea of finding
the transition plan to carry America
from "pump-priming" by Govern
ment to private business expansion
and avoid an era of serious defla-
ton
Artificial Prosperity Created.
AS it is, an artificial prosperity
has been created which will last
possibly until the spring of 1910 and
there will be a serious controversy
between now and that time as to
whether another dose of pump
printing" must be resorted to or the
day of reckoning observed when
painful def1ation and business re-
cession may have to be faced as the
price of readjustment and an
eventually sounder economy.
What the Congress did not do is
almost as sensational as what it did
do. Thus the following acts of omis-
sion are conspicuous:
/. The Wagner Labor Relations
Act was left untouched, even though
: employers have been arguing that
1t induces instead of cures labor
strife and even though the Ameri-
can Federation of Labor, largest
labor organization in America, said
the law is in several particulars un-
fair to labor.
2. The wage and hour law was
left untouched, even though sub
stantial sentiment was apparent in
favor of certain revisions and
changes which would make the law
less deflationary In its effects on
small businesses A diminution Of
hours to be worked and another
increase in rates per hour go into
effect this October without any pro-
vision for an increase in output per
man.
8. The securities and exchange law
was left untouched, even though the
need for certain revisions to permit
capital markets to be reopened, es-
pecially for the smaller businessmen
of the Nation, has been widely urged
as a step toward recovery.
Income Tax Rates Untouched.
4. The income tax rates in gen.
eral were left untouched, even
though for some time now it has
been apparent that capital is choked
and blocked from free movement be-
cause of the inequities of the pres
ent tax laws.
s. Social security pay roll taxes,
which are the most def1ationary in
fuence that has been introduced
into the American economic system,
because they constitute a levy on
gross pay roll expenses, rather than
on capacity to pay, were left un-
touched, even though Congress did
leglslate to refrain from adding still
further def1ationary burdens in jan
uary, 1940 and did eliminate Ger
tain pay roll taxes on salary levels
above $4,000.
6. Nothing was done to revise the
neutrality law, leaving that statute
IN position to produce great risks
for the American people, instead of
taking positive action to help pre-
vent world war in which Amer
lean boys might again be sent over
seas.
7. Nothing was done to assure fair
hearings and impartial procedure by
Government commissions, bureaus
and boards as provided in the Logan
bill which was passed by the Senate
onl'' 10 be reconsidered and left for
neX. session.
AS for acts of commission, the
authorization of $13,000,0OO,O 900 ex-
penditure is phenomenal example
of disregard of the mandate of a
congressional election wherein as in
1888 a substantial protest vote was
manifested against spending.
The Credit Side.
The coalition of Republicans and
conservative Democrats did not
function except in exercising veto
against the administration in the
last few weeks of the session and in
ordering another investigation of the
National Labor Relations Board. The
coalition was strangely passive when
the biggest appropriation bills were
going through both Houses.
On the credit side of Congress is
the passage of the Government re-
organization bill, the enactment of
the Hatch bill to ban pernicious po-
lltical activity on the part of Office
holders, the elimination of the un-
distributed surplus tax-though it is
question what damage the substi-
tute provision about unreasonable
surpluses" can still do-and, finally,
the enactment OF desirable changes
IN the Social Security Act itself.
These last amendments were ap-
proved by both parties by an over
whelming vote. The usual run of
unopposed minor measures was
passed, but host of problems like
the railroad bill and the national
health program were left over until
the next session.
In the sense that the administra-
t1on really didn't want changes in
the labor relations law, the wage
and hour law or the securities and
exchange law or any substantial re-
ductlon in appropriations, the ses-
sion can be counted kind of New
Deal victory.
AS for the opposition, it got busy
too late to accomplish anything
more than defeat of the new lend