Evening star., 1945-02-21
Postwar Jobs Bill
With Wallace Ideas
- $50 ----~---. -. s. -
Confronts Congress
By the Associated Press.

Regardless of what political fu-
Iture befalis Henry A. Wallace, Con-
gress will be- called on to act on q
major principle in his proposed pro-
gram for 6o, ,000, 900 postwar jobs.
Chairman Spence said today he
soon viii call public hearings before
the House Banking Committee on q
bill authorizing the Federal Reserve
System to guarantee financing In
stitutions against loss on loans made
to business enterprises. The Gov
ernment would assume up to 90 per
cent of the risk. - 49, = IF
Mariner S.. Eccles, chairman of
the Federal Reserve Board, has SUBJ
mttted to the committee state
ment noting that this type. of loan
has been used in financing war pro-
duction under the "V-ioan" program.
He said "the guaranteeing of such
loans by the reserve banks would not
be competitive with the private
banking system in, any way"
This suggestion for postwar busi-
ness financing antedates the nom
ination of Mr.. Wallace to be Secre-
tary Of Commerce. The Banking
Committee considered similar. legis-
lation last fall. but never completed
its hearings. >r~- -.
MIR. Spence said the proposal
originated in the .Baruch- Hancock
report on planning for the postwar
reconversion period. s.y. ~. - -
In, the Senate Banking Commit
tee,- Senator Taft. Republican, OF
Ohio is leading Q move ~ pare
down the monetary powers Congress
granted the executive branch of
the Government in depreSStch days.
He suggested amendments might
be attached to pending Federal re-
serve legislation to eliminate au-
thority:. -. =. -.
l. To issue Federal Reserve Bank
notes which require no reserves
whereas Federal Reserve notes re-
quire reserves. About $500 900 900
of hank notes have been Issued un-
der this authority granted in the
Emergency Banking Act Of 1888.
2. For the Treasury to Issue
50 600 900 900 in "Greenbacks." No
use has ever been made of this
authorization. :. "a : = =, -,
Mr.. Eccles told Senator Taft. at
committee hearings Yesterday that
he would have no objection to such
amendments. -. -, 50,
Mr.. Wallace, in outlining his
plans for a $4,000, ,000-job program
before the Senate Commerce Com
mittee January as, during consid-
Grafton OF his nominatim as Cop-
merce Secretary, said =
Il propose that the, Government
guarantee the lender against any
special and abnormal risks which
may be involved in achieving our
objective. This will provide new and
expanding industry with plenty Of
private credit at reasonable inter-
est rates. &c.,.
Through this program we will
merely be extending to the financing
of old and new business the prin-
ciples which have proved so sue.
cessful in our experience with the
V-loans, T-loans and Federal Hous-
ing Administration loans.
70 Billion Of New Investment.
"As a matter of fact . compre-
hensive investment program of this
character could make possible $2o.-
600 ,000, 900 of new private invest
ment each year. =. L. L..
Storm clouds already were gath
ering around the proposal that the
Federal Government back loans
made by banks and other lending
institutions. -..
Representative Wolcott, Repub-
lican, of Michigan, ranking Repub-
lican on the Banking Committee,
said this might be the first step
toward the socializatfon Of credit