Evening star., 1939-06-27

the dCllOn taken Da'iu Ld"rehce.
in withdrawing from the President
the power to stabilize the dollar in
relation to other currencies gives
the financial gamblers of the world,
from Wall Street to Shanghai, eX-
actly what they have been hoping
fora victory over the 24-hour
basis operations of the Treasury
Department here.
For several years American trade
has been protected and the Amer
lean dollar has been fortified against
speculative invasions by the world
gamblers of Paris and London. No.
body knew in advance what the
Treasury would do with its stabili-
Zation fund or what it might do
with respect to the narrow margin
of 10 points available as fleXibility
IN dollar stabilization.
May Affect Trade Agreements.
If the Senate action prevails, the
dollar will be subject to attack by
foreign spectators. Trade agree
ments can be adversely affected and
much injury done to America s eco
nomic position while the present
or future administrations wait on
the Congress to grant power to do
something to stabilize the dollar
The important point hitherto about
fixing the dollars valuation through
executive action has been to put
the American Government on terms
of equality with parliamentary gov
ernments and dictatorship govern
mentS, which can take instant ac-
ton. If a special session of Con-
gress now has to be convened or
if action has to be taken at a regu-
lar session whenever a monetary
crisis arises, the speculation over
the price at which the dollars value
Is to be we'll fixed will give the spec
ulators the chance they have long
been eager to get.
Whether the President as an in
dividual should have the power to
revalue the dollar or whether a ma
tional monetary commission COM
posed of experts shall have this
power delegated to it by Congress is
something wholly unrelated to the
question of whether the dollars
value should be rigidly fixed or left
open within a certain number of
points as at present so that America
can protect her position as against
foreign incursions in the trade and
monetary world.
Invites Trade Nervousness.
The fact that America can de-
value instantly has a salutary effect
on those countries which may think
advantage would come to them
through another currency deprecia-
ton war. To announce to the world
that the monetary power in the
United States is in a straitjacket
and to do so within three days of
the time the existing devaluaton
power expires is to invite nervour-
ness in the financial and trade
markets of the world.
The impression prevails here that
within the next "a hours the admin
istration and its opponents on Cap
itol Hill-the silver bloc-Will come
to terms. The silver bloc wants
bigger subsidy than the silver pro-
ducers are now getting. Silver's
world price is about 43 cents an
ounce and owing to American Gov
ernment support were it not for the
American Governments policy of
creating a demand for newly mined
silver by offering to buy it at about
"a cents an ounce as well as by
buying foreign silver the world
market price might fall to 20 cents.
Get "Trading" Advantage.
The Senators from silver -produc-
Ing States wanted the administra-
ton to agree to boost domestic
silver price from 64 cents to II
cents, but the increase in subsidy
was refused. A coalition was then
made combining the votes of the
silver States Senators with those
conservative Republicans who want
the power Of stabiliZation or de-
valuation taken from the Presi-
dent. This alliance not only brought
about the defeat of the devaluation
provision sought by the President,
but enabled the silver Senators to
get their 77-cent price written into
the bill for trading" purposes, to-
gether with the proviso that the
Treasury shall buy no more foreign
silver. This means that when the
bill gets into conference.-the House
already having passed the bill as
desired by the President-the silver
State Senators will say in effect:
"Give us better price than 81
cents for silver and we will support
your devaluation power proposal"
This is the way things are done