Evening star., 1939-06-24
Critics Of Lending
Center Attack on
Foreign Loans
BorkIey Looks for
Opposition. but
Forecasts Approval
B, the Associated Press.

Critics of President RooSevelt'S s
new 1880, 900 900 lending program
centered their opposition today on
a provision calling for $500, ,Ooo, 600 In
loans to foreign countries.
While several predicted the entire
program might encounter hard
Shedding in Congress. good many
more expressed the opinion the for
eign loans would be rejected.
On the other hand, Senator Bark
ley of Kentucky, the Democratic
leader, had this to say after a White
House conference late yesterday at
which congressional Democratic
chieftains agreed to seek immedi-
ate action: =
Most of the program, and prob
ably all of it, will 60 through with
out much difficulty. Some of it will
cause debate, but the general feel
ing is the whole thing will receive
the approval of Congress"
AS to the proposed loans to for
eign countries, it is assured they
would go largely to Latin American
nations, because the johnson Act,
forbidding advances to war-debt de-
faulters, bars credit to most Euro
pean powers.
Taft Opposes Plan.
Saying the Presidents program is
supposed to be f-liquidating,
Senator Taft, Republican. of Ohio,
asserted that there is nothing self
liquidating about foreign loan
The lending program provides that
proceeds from the loans would be
spent in this country, but Senator
Adams. Democrat. of Colorado, told
reporters, I'VE ought to know by
now that we can't buy business
Senator Byrnes, Democrat, of
South Carolina, to whom Mr. Roose-
welt transmitted the lending pro-
posal asserted he would be very
loath to vote for any foreign loans.
From Senator Austin, Republican,
of Vermont came statement that
"the American banks are full of
money to loan. and if foreign loans
are good, they probably can get the
business"
Protests against the program also
were made by Senator Byrd. Demo-
crat, of Virginia and Frank Gan
nett, Rochester On. " newspaper
publisher.
Program Called Evasive.
Calling 1t an "evasive plan for
public spending" Senator Byrd in
troduced resolution calling on the
Treasury for a financial statement
of 80 Government lending agencies.
Although advances under the new
program. would not be reflected IN
the budget. Senator Byrd said they
would constitute "a Federal debt,
and any losses must be paid by tax
alton"
Mr.. Gannett, speaking as chair
man of the National Committee to
Uphold Constitutional Government,
described the program as "a most
fragrant approach to the purchase
of an election" He said in tele-
gram to members of Congress that
he feared this proposed expansion
OF the New Deal will end with pri-
vate enterprise undermined beyond
recovery"
Democratic leaders in House and
Senate began drafting an omnibus
measure for Introduction early next
week.
At the two-hour White House con-
ference late yesterday, IA executive
officials and legislative chiefs went
over with the President the entire
proposal to authorize Federal lend
ing Of 50 1850, 900 900 over seven years
to public and semi-public bodies
for the construction of self -liqui-
dating projects and add $500, 900 900
to the United States Housing Au-
thority's borrowing power for loans
and subsidies on low-cost housing.
One of the conferees, Chairman
Harrison of the Senate Finance
Committee, told reporters there was
a quite insistent" demand at the
White House for immediate action.
Senator Barkley said it may be
found that some parts of the plan
could be carried out under existing
law.
Although voicing belief that the
interest rate on loans would be f1ex-
ible to care for the wide variety of
projects proposed, he added that the
general view" expressed at the con-
ference was for rate of around 23a
per cent.
The Senate leader said the new
consolidated Federal Works and
Federal Loan agencies, which become
operative July l under the Presi-
dents reorganization plan, would
handle much of the program.
The President appointed John M.
Carmody of New York yesterday to
head the new Works Agency-em-
bracing the w. P. A., P. w. A. and
other employment agencies-and
chose Jesse H. Jones of Texas to be
Federal Loan Administrator. The
post to which Mr.. Jones was named
will have supervision over six lend
ing organizations, including the R.
F. c. which he now heads.
Mr.. Carmody is now chief of the
Rural Electriflcation Administration,
which will be transferred to the Ag-
riculture Department under the re-
organization order.