Evening star., 1939-01-24
Mariner 5. EccIes
Gives viewso on
Spending
Federal Reserve bourd
Choirmun Is Rudio
Forum Speaker

ii 6roaocaSung co. The texL OF MS
address follows:
A week ago tonight Senator Byrd
Of Virginia spoke over this station
on Government Spending" I am
grateful to the National Radio Fo-
rum, conducted under the auspices
Of The Washington Evening Star,
for this opportunity to speak to you
on the same general subject.
What I say represents my own
viewpoint as 1t is now and as 1t has
been consistently for more than
eight years. I do not speak for the
Board of Governors or for the Fed
eral Reserve System. speak merely
as one who has had more than 20
years of practical experience in
banking as we'll as in various busi-
ness and agricultural enterprises,
and who happens to occupy a public
Office concerned with banking, fiscal
and monetary problems. These are
economic problems and I have al
ways approached them from an
economic rather than from politi-
cal standpoint. In fact I cannot
approach these questions from any
other standpoint. for I have never
taken an active part In politics and
I have never sought a public Office.
Greatest Domestic Problem.
The greatest of all domestic prob
lens before this country today is to
find steady jobs in private enterprise
for all of our unemployed who are
able and willing to work.
The fundamental issue between
Senator Byrd and myself is whether
the Government can and should
contribute to bringing about an in
crease in private employment by
borrowing idle money, and lending
and spending 1t, at time like the
present, when there are millions OF
people who cannot find jobs in pri-
vate industry, when there is an
abundance of natural resources, un-
used productive facilities OF all
kinds, and billions of savings and
of bank credit waiting to be used.
In the limited time at my disposal
tonight, I cannot deal with all OF
the misconceptions of my position
under which Senator Byrd evidently
labored in his recent statements on
this subject. This I expect to dc
by letter at an early date. The
issue between the Senator and my
self is not personal. and I ascribe
to him, as he does to me, the fullest
degree of sincerity.
Spending In Depression.
At the outset, I want to clear away
some of the more glaring miscon-
ceptions of my views. I do not be-
lieve in Government spending at
any time for spending's sake. I dc
believe in Government deficit
spending in depression periods as a
supplement and stimulant TO private
spending, using only the man power
materials and money that otherwise
would be idle. and using them only
in a way that avoids competition
with private enterprise. I believe
that ineflciency and waste should
be eliminated Government should
get the maximum of value for the
money 1t spends, recognizing the
size and inherent difficulties of the
unemployment and relief problem
the objective always being a maxi
mum Of private employment. I alb.
hor politics and favoritism in any
phase of Government expenditures
I am as anxious as any one to see
the Federal budget balanced. Ir
my judgment this cannot be accom-.
plished until the national income j.
higher than it will be this year.
do not believe it can be done at thi.
time either by reducing Government
expenditures or by increasing Fed.
eral taxes, particularly those thai
bear most heavily upon consump.
ton. I believe that the only way
the budget can be brought into bal.
ance Is through increased Fedora
revenue from an increased nationa
income.
Not Cure All.
I am just as much against infla-
ton as am against deflation. How.
ever, we do not want to stay in 6
perpetual def1ation because Of feal
of imitation. Imitation can ane
should be prevented, and this car
be done by giving adequate power.
to the Treasury and the Fedora
Reserve System. I do not see how
it would be possible to have a dan.
gerous general imitation so long a!
We have a large amount Of idl.
men and unused resources. Long be.
fore imitation could develop, W,
would have a volume of busines!
activity that would increase the ma.
tional income to a point where tn.
budget could easily be balanced.
do not believe, and I have never
said, that the Federal debt shoule
continue to grow indefinitely and NJ
part of it ever paid. I do believ,
that 1t cannot safely be reduced ex'
cept when national income is higf
and when private debt is expand
ing. Reduction of Government deb
at such time would tend, to coun
teract any trend toward imitation
that might develop, just as expan
sion of the Government debt durin,
depression tends to offset deflation
ary developments.
realize that Government spend
ing is not cure-all or q remed,
for all of our problems, or for spe
cial conditions that may be re-
tarding private employment and in
vestment. Everything should b.
done to bring about a>prompt solu
ton of these problems. In tn,
meantime I can see no practica
alternative except to sustain pur
chasing power through public EN-
ployment until private employment
substantially increases.
Fundamental Changes.
The viewpoint which I have out
lined relative to the need for Gov
ernment spending is strongly op'
posed by Senator Byrd, by most O.
the press, and by many of the bank
ers and large business interests o.
the country today. Most of then
still demand, as they did at thu
hoffnva ~ hn IoNroeciovH IN 1920