Evening star., 1939-09-03
Foresees Boom in
Armament Building
By OUen L. Scott.

lOIWCu dLuOIlk oUfcTlmcuL OIQClalS.
The conclusion is this: Regardless of
any State Department or White House
DESIRES the United States is steadily be-
Ing forced to 60 1t alone in the world
Reasons for that conclusion are the
following:
All Of Europe, including Great Britain
and France, now is rushing toward a
strictly controlled economy in the inter-
est of national defense. Currency con-
trolls, trade controls, investment controls
are clamped down everywhere With
Germany and Russia tending to get to-
gether, any prospect of resuming normal
relations in that part of the world ap-
pears to be gone.
Tghtened controls abroad make it
harder to find outlet for surplus Ameri-
can goods and surplus American capital
Europe. even in wartime, Is better pre-
pared to produce the foodstuffs and fibers
that she needs than she was in 1914
And, at the same time, Canada and the
Argentine are big new bases of supply
that did not exist in any such size during
the last war period.
The United States does offer vast IA
cilities for arms production and for vi
tally needed industrial products, but the
American dollar is harder and harder to
get. Resources of the British and French
have steadily dwindled and today-un-
less this country should decide to make
more loans-those two countries could
mobilize only half Of the total Of dollars
hat
period.
AS a result, the time gradually is ap-
preaching when the United States will
need to turn its attention toward do
mestic affairs in order to deal with prob
lens caused by the dwindling prospect
that foreign affairs will provide the re-
covery answer. Abroad, nations are in
creasingly nationalistic from force of
necessity.
Nationalism of the rest of the world
is in turn, likely to force more nation
alism on the United States
Many problems grow out of that
prospect.
If the United States is not to find ade-
quate markets abroad for cotton and
wheat and other surplus farm products,
then there is an. internal problem that
will have to be solved on different basis
than simply by subsidizing farmers to
reduce production. Farm income even
now is falling in the face of vast subsi-
dies. The reason is that prices cannot
readily be supported in the face of mar
rowed markets.
If, at the same time, the United States
cannot find backward countries to de-
velop through export of capital and OF
the products of industry, then attention
will need to be devoted more intensively
than ever to finding new markets at
home for capital and for goods.
But to put money to work at home in
volume large enough to provide pros
perity is difhcult because of the very ad-
justments that are forced by the lost
markets abroad. Congress objects to
having the Government go into the
Business men object to having Govern
ment try to control prices and to direct
| production. Bankers object to having
the Government force interest rates
down near to the vanishing point in
order to attempt to stir up investment
and to discourage saving.
In the midst of this situation, an out"
now is beginning to appear.
The New Deal has tried pump priming
Through w. P A. and through low-cost
| housing and through vast farm subsidies.
There have been some results, and. at
the moment. the country is poised to
make sizable recovery as result of
Government spending and of greatly in
creased buying of automobiles. The auto
industry promises to give the country an
important boost.
Experts, however see little sustained
recovery in the prospective production
and selling of new cars. They are some
what hopeful of home construction to
carry on They have crossed off foreign
lending as a probable influence.
What they do see, however, is the rise
of big new industry that might turn
the tide in nationalistic period
That new industry is armament on q
scale not yet envisioned in the United
States.
Armament in the present fiscal year
July 1899, to. July. 1940-will call for
outlays of about 81 800 600, ,000 The Brit
ish, with one-third of the population of
the United States are spending $30O0,-
900 900 in the same period. Armament in
Britain has produced boom that verges
on the sensational. 1t has soaked UP
employment, put money to work and
given rise to problems of boom control.
If this country is to find itself faced
with the problem of policing the Western
Hemisphere, it's military and naval needs
can become immense.
Armament, too, is highly popular in
Congress and with businessmen.
Objection has been raised to spending
money for homes and for improved high
ways and for water power developments
and for other internal improvements
that cost large amounts of money and
upset the Federal Government budget.
Congress refused during the last session
to 60 along with the President on a pro-
gram of Federal Government investment
in public works. Businessmen and bank
ers opposed the program rather violently.
However, neither Congress nor indus
try nor banking has ever entered objec-
tion to deficit spending for battleships