Evening star., 1939-03-11
Administration Held
Dropping Request for
Debt Limit Boost
New Deal Held Fearful
Five Billions Increase
Would Disturb Business
By the Associated Press.

Some Senators predicted today the
administration would drop the idea
of asking Congress to increase the
public debt by $4,000. 100000.
Secretary of the Treasury Nor
genthau told a House Committee
recently 1--WE are going to have to
ask Congress to extend the debt
limit from s45 ,00O,O00,OOO to $780,
000000,000 if the legislators ap-
proved the expenditures proposed in
President Roosevelt's budget esti-
mates.
Senator SchWellenbach, Democrat,
of Washington, an administration
supporter. commented today, how
ever, that he saw no necessity of
increasing the limitation this session
if it would suffice until next year.
Other Senators. asking that their
names be withheld, said they were
confident the administration would
not ask the increase.
They said any raising of the limit
now undoubtedly would tend to dis
turb business confidence.
Dangerous Politically.
In addition, some congressional
Democrats expressed apprension
that it might be dangerous polit-
ically to effect the increase. The
issue would give Republicans an
opportunity to make record"
against governmental fiscal policies,
they pointed out.
Treasury estimates have placed
the probable debt on June 80, 1910,
at S44, 400 1000, ,OO0-within s6OO,OOO,-
900 of the limit.
Some Democrats said they were
hopeful business would pick up suf-
f1ciently to increase expected tax
collections and make it unnecessary
to bring up the issue either this
year or next, when it might provide
ammunition for the Republican
presidential campaign.
Representative Mcleod, Repub-
lican. of Michigan proposed yester-
day that Congress create a nine
man committee to ascertain the
limit to which the public debt could
increase safely. In his recent testi-
mony, Secretary Morgenthau said
he would mot worry" about a debt
Of S50,000,000,000. but declined to
express an opinion as to what would
be a safe maximum.
The debt question shared interest
on Capitol Hill with an order by
the Securities and Exchange Com
mission revising its rules on short
stock market sales.
Greater Market Freedom.
The commission said the change,
recommended by the New York
Stock Exchange, provided greater
freedom OF market action by elimi-
mating a former requirement that
short sales be made only at a price
higher than that involved in the
last preceding transaction in a Sc
curity. The new rules allow sales
at the same figure as the last trans
action, provided that figure was
higher than the last different price
which preceded it."
Senator Adams. Democrat, of
Colorado said the commission order
was a step in the right direction.
He declared it was possible for
artificial conditions created by Gov
ernment to be just as dangerous
as artificial conditions created by
stock market traders" The change
in rules should tend to stabilize the
market, the Senator said.
Turning to the question of Gov
ernment economy, Senator Adams
declared that unless there is some
substantial reduction in the expenses
of our Government there is no
escape from a financial catastrophe. :"
Such an eventuality, he said,
would carry Exceedingly grave pos
sibilities of injury, if not destruction,
to our present form of government" !"
There is no class of people who
will suffer so seriously from such a
catastrophe as the workmen and the
salaried people and others in the
middle economic levels"
Chairman Harrison of the Senate
(see BUSINESS, Page A-3)