Evening star., 1939-06-23

in the years to come and that these
billions will have to be paid by taxes
levied on all the people"
No U. S. Contribution.
Mr.. Roosevelt was asked at the
press conference whether the Gov
ernment would contribute toward
the cost of express highways pro-
posed under the lending program,
since they would have a military
value. He said he did not think so.
He also. told reporters that only
public and quasi-public groups would
be eligible to borrow under the pro-
gram.
He said he did not believe the
interest rate should vary according
to types of projects. For example,
he said, if the Pennsylvania Rail-
road, which seemed to be solvent,
wanted new equipment, and another
road not so we'll off also needed
equipment, the two would probably
be Jumped together to provide the
same rate.
Asked whether loans to foreign
governments to promote foreign
trade would be prohibited to gov
ernments which defaulted on pri-
vately bought securities, the Presi-
dent said there was some relation
in the proposal to such countries,
but not very much.
He said it comes down to the
question of current soundness. He
recalled certain bonds of South
American governments which New
York banks sold to private investors
in 1920 under high pressure methods
and added he could not see where
what he called the ancient frauds
of the 1920's had much to do with
sound loans now.
Cites New York Road.
The President explained that
many of the projects proposed would
be those which private bankers
would not care to go in on because
of insufficient spread in the loans.
AS an example, he recalled that
when he was Governor of New York
the American Legion got through
the Legislature toll road project
on White Face Mountain. He said
survey showed it would pay its
own way, but that private bidders
refused to bid on the bonds be-
cause there was not much spread.
The State controller, he added,
bought the bonds himself for the
State and they have been paving
ever since.
Because Congress already is
rushed with pre-adjournment legis-
lation, there were some expressions
of doubt that it would enact the
Presidents six-point, seven-year
plan this session.
Legislative lieutenants said action
this year would depend on the ex-
tent of new legislation needed.
After informal discussions, the
leaders and interested committee
chairmen are expected to accept the
Presidents invitation to talk over
the situation at the White House.
To Be Repaid.
Designed to stimulate business and
employment without costing the
Treasury any money, the President S
program would authorize loans for
various purposes, among them:
To States, cities and counties for
sewers, bridges, hospitals, etc.; to a
new Federal Toll Authority for toll
bridges and express highways; to
another Federal corporation for
purchase of railroad equipment; to
farm tenants for purchase of land !;
to the Rural Electrification Admin
istration, and to the Export Import
Bank to finance foreign purchases
in this country.
Besides the $4,000, 900 900 in loans
the program would allow the United
States Housing Authority to borrow
an extra $8O0,00O,0O0 to finance
housing projects.
The total outlay for the year be-
ginning next July l would be $780,
100000.
Senator Byrnes, Democrat, of
South Carolina, to whom the pro-
gram was submitted as a substitute
for the House provision earmarking
$125, 900, 900 of Works Progress Ad-
mlnistration funds for more Public
Works Administration projects, said
he doubted whether the new legisla-
tion could be tackled on the $l,735,-
100000 relief bill because of the
time element" The relief bill must
be passed by June 80, when existing
w. P. A. funds give out.
Economy Bloc Skeptical.
Administration supporters gener-
ally praised the Presidents plan
on the ground it would help stimu-
late private industry at a time when
it is greatly needed.
Republicans viewed the proposal
as political, and some said they saw
in it an opening wedge for a third
term" announcement.
Many Congress members of both
parties criticized the provision ex-
panding the borrowing power of the
Export-1mport Bank so it could lend
$500, 900, 900 additional in two years
to foreign governments to promote
foreign trade.
They promised a stiff fight or
this feature, designed to supple
ment credits already extended te
Brazil, Nicaragua and Paraguay.
AS for the railroad equipment
purchases, Chairman Wheeler o,
the Senate Interstate Commerc.
Committee said he preferred lending
the carriers money at lower rates O
interest.
Typical of the favorable comment!
was that of Senator Wagner, Demo
crat, of New York, who said it woult
help Stimulate durable goods in
dustries which particularly meek
help at this time"
| Senator King, Democrat, Of Utah