Evening star., 1940-09-14

famous opinion DaNio La"fehce.
which asked the President of the
United States to violate the laws oi
the land, has announced that it is
grossly miSrepreSenting the so-callec
Bethlehem cases to say the Govern
ment was reopening old lawsuits
Mr. Jackson says:
1T has been published in various
papers that the Government is
frightening business and industry
into the feeling that they cannot
deal with the Government in the
present emergency on a basis OF
dependability. We are going to f1no
out through this suit whether any
Government officer can commit the
Government to unconScionable prof
its by manufacturer. Maybe that
will give some point to the Russell
OVerton amendment to the SelectiV6
draft bill"
The Attorney General used to
know something of the operations
of business when he was a public
utilities lawyer. He knew then that
once a case is closed and the money
paid over. it usually required a
showing of fraud in order 20 get
contract reopened. That has been
the immemorial tradition of the
law.
% Years Later.
Today, nearly % years after the
last World War. the Government of
the United States, even though the
money was paid under the contract.
now files a claim to recover what
1t claims We're too large profits.
Would Mr.. Jackson risk his own
money on contracts of that kind
and would he find any bank in
the country or any investors who
would put money in a company
which might get Government con-
tract today and be subject at any
time in the far-diStant future to a
suit for the recovery of sums paid
on the ground that these were
"unconscionable"?
The New Dealers it is being widely
inferred, are much more interested
in playing politics with defense and
making demagOgic appeals to class
prejudice to help the third-term
candidacy than in speeding up de-
fenSe production by removing OBJ
stacles to increased output through
the building of new plants and the
encouragement of industry
Congress is passing laws to 5limit
excess profits. But apparently this
Is not enough. Long after the
Treasury has collected what is due
the courts are to be asked, when
ever the Government wishes it, tc
reopen any case which is already
closed.
The Attorney General insists that
the present cases he is fighting are
necessary to save the Government
money awarded in a lower court
He stressed his duty to appeal thai
case and virtually ignored the fact
that in another case it was the de-
partments initiative which Is car.
rylng to the Supreme Court ar
effort to overrule what three judges
appointed by the New Deal said was
q closed case
Would Shift Authority.
Frederick H. Wood, alto ney, who
Is fighting the extraordinary tactics
OF the Attorney General and who
won the famous n R. A. case in
the Supreme Court, says in a brief
filed with the Supreme Court:
Carried to its logical conclusion
the contention of the Government
would appear to be that this court
independent of any statutory limita
ton of profits, should declare that
as matter of law, no Government
contractor, in time of war or al
any other time, no matter what the
terms of the contract may be OF
what benefits may be derived there
from by the Government, may re-
celve or retain any profits in excess
of that which the courts shall sub
sequently determine to be rea-
sonable.
No authority is cited in support
of that startling contention, which
If correct, would transfer the de-
termination of prices in GC.ernment
contracts from the executive to the
judicial department and the deter
mlnation of questions of policy, in
respect of such contracts, from the
Congress to the courts"
Investors generally are soon to be
asked to provide funds to finance de-
fenSe contracts. Under the Securi-
ties and Exchange laws passed by
the New Deal it is stipulated that
nobody selling securities may omit
any essential or material fact. II
Mr.. Jackson's point of view is upheld
by the Supreme Court, it will NEAR
that every company must frankly
tell prospective investors in advance
that they cannot count on theil
company's retaining any earnings
because these must really be set ur
in reserve for the indefinite future
for fear the Government under thi,
or any subsequent radical admins.
tration may at any time decide tc
reopen the old contracts and CRY
"unconscionable profits"
Would Delay Production.
Three New Deal judges in the
Circuit Court of Appeals ruled
against the Attorney Generals con-
tentions. That should have ended
1t, But the opportunity to gel
headlines by attacking so-calleo
profiteering in the middle of a presi-
dental campaign-even though the
contracts were nearly % years old
was evidently too good to miss, sc
the Solicitor General, who files pe-
tltions in the court one day and
campalngs on the stump the next
day against Willkie, made his pro-
nouncement. And now the Attorney
General denies the charge about re-
opened cases as "falsehood." The
records in the court and the briefs
filed by opposing counsel show that
II the administration is upheld in the
Supreme Court, production will be
impaired because nobody will be able
to depend on the permanence of a