Evening star., 1939-07-30
Business Need Not Wait
For New Deal Demise
By ODen L. Scott.

test in the period just ahead as a result
of action by Congress
The idea is this: Recovery awaits
decisive defeat for the President and
check to the Presidents New Deal.
Given that defeat and that check, all
will be we'll with industry and finance.
Congress now has accepted the idea.
Mr.. Roosevelt is set back on his heels.
A presidential recommendation at this
stage is almost signal for defeat The
attitude in both the Senate and House
suggests that this same conflict between
the Executive and the Legislature will
continue in the 1910 session. Very def
nitely, new experiments of real impor-
tance are through for this administra-
ton. At the same time, old experiments
are undergoing the sort of treatment
that an administration friendly to busi-
ness would be expected to give. The
National Labor Relations Board is to be
given thorough going over by hostile
House committee. Enforcement of that
act is beginning to bog down. Courts
are opening loopholes favorable to en-
ployers, and the board itself-to meet
criticism-is doing a bit OF the same
thing. Furthermore w. P. A. is going
through the wringer. Appropriations
are reduced and policies are changed to
meet employer ideas. Relief no longer
is the support for hourly wage scales
that it was before July l. Then Con-
gress has repealed the tax to which busi
nessmen most violently objected and has
modified other tax laws to conform to
recommendations of business taxpayers.
Spending goes on in huge volume, but
based on the voting record-spending
would continue to go on regardless OF
the administration in power.
In word: The President has met the
to be a condition of recovery and the
New Deal has been modified at those
points that businessmen have held to be
essential before recovery would come.
Now what is to be expected? Is the
long awaited full recovery just ahead?
Mr.. Roosevelt thinks not. The President
has the somewhat unusual idea that the
Senate's determination to stand on
provision of the Neutrality Act that has
prevailed since 1885 will prevent recov-
cry. None of the Presidents advisers on
economic matters has any such idea.
Rather, there really is some encourage
ment in the business outlook Industry
is receiving a larger volume of orders
from merchants who have seen their
stocks of goods depleted by consumer
buying. The 1899 recession in the re-
covery trend occurred largely in produo-
ton and only to minor extent in con-
sumner income. Generally, the Govern
ments appraisers expect that the re-
mainder of 1889 will see a gradual and
definite pickup in the rate of indus
trial activity. with trade continuing at
the high level of recent months.
Official forecasts suggest that this up
ward tendency will continue into 1910
On that basis it begins to look as
though Congress is right in its idea
that recovery waits only for the Presi-
dent to be stopped and for the New Deal
to be reversed. But always the recov-
cry predictions are hedged. The hedge
is based on this condition-that there
be no outbreak of war in Europe and
that there be no more crises in Europe
There is where the idea that recovery
will develop. if only President Roosevelt
can be checked, comes cropper. Some
thing more than the President Or the
New Deal obviously is in the way of a
return to the normal prosperity for
which the Nation yearns.
Congress discovers that Mr. Roosevelt
has been stopped and the New Deal
checked only to learn with surprise that
wheat in Liverpool has sold down to the
lowest price in history and to discover
that commodity prices generally are in
sad state that fails to respond to the
Presidents defeat. Real fact of the
matter is that the men whose business
1t is to analyze and to chart the course
of business find that the underlying sit
uation in business at home and abroad
continues to be fundamentally unsound.
Everywhere the recovery that is appar-
ent is based upon Government spending,
either for armament or for relief or for
some other purpose of rather question
able long-range value. To withdraw
that spending would involve a return
to defation, barring an extremely un-
certain rise in private investment timed
to take over as Government pulls out.
Deflation Is the last thing a Congressman
can want. 1t is painful and represents
the best single known prescription to
produce political death for the man in
Office.
If Congress really desires to find out
what would happen once the New Deal
Is ended, the easiest way to find out is
to abolish the Agricultural Adjustment
Administration. and with it the immense
subsidies and the drastic controls that
apply to agriculture. Turned loose to
Shift for himself, the wheat farmer
would find that his product is worth on
the world market about Is to 80 cents a
bushel. His corn, with price controls re-
moved, rather quickly would be back in
the 10-to-15-cent range. Cotton, if re-
leased into the market from the vast
storage supplies. probably couldn't be
given away. Nobody expects Congress
to show the self-sacridce necessary to
allow agriculture to become a free" in
dustry. Yet if agriculture is to be main
tanned on q subsidized and controlled
basis. then other branches of America n