Evening star., 1950-03-14
Special Fovors for a Special Group

1t goes without saying that legislation which
purports to help the middle ($2,7O0-$4, ,400) in
come group to get cheaper housing carries ire
mendous popular appeal. That is why the ad-
ministration is backing it to the limit. That is
why the Chairman of the Democratic National
Committee Mr.. Boyle, is calling all politicians
to apply the heat to Senators when they vote
tomorrow But no matter how popular may be
the appeal, the legislation is bad and it ought to
be defeated.
1t ought to be defeated because it is discrim-
inatory and unsound. Using tax money contrib
uted by all Americans, it. singles out special
group of Americans-those in the middle Income
brackets who choose to join housing co-opera-
tive-for special benefits. Under this BILL the
American who joins cooperative can obtain
the benefit of low interests per cent or under
and pay off his housing loan in fifty sixty years.
a "come-on" proposition designed to miSlead
borrowers and perpetuate debt. But the American
in the same income bracket who prefers not to
join cooperative housing scheme must pay 4
per cent or more and pay off the loan in twenty
five years. The same Government, indirectly or
directly, would be backing both types of loan.
In system of society based on free enter
prise, which we are spending large part of our
substance to protect throughout the world, CO.
operative, non-proht enterprises are as permissi-
of free enterprise, they should stand on their own
feet The pending bill goes much further, how
ever. It offers hidden Government subsidies in
variety of forms as mark of special favor to
non-proft co-operativeS If the principle behind
this bill is carried to its logical conclusion, and
supported with public funds and Government
credit to make it work, there will be no room in
America for one of the largest of all tax-paying,
private enterprise industries, the private housing
industry. 1t would eventually become an industry
supported by Government, with everybody joining
q housing cooperative under the supervision OF
another huge Government bureaucracy.
The bill ought to be defeated on other
grounds. 1t would place private housing, includ-
ing FILA and veterans housing, at serious COM
petitive disadvantage. 1t would in time weaken
the stability of billions of private funds invested
In such housing by insurance companies, build
ing and loan companies and millions of middle
income men and women whose savings have
been put into the independent purchase of homes
For when the Government makes cheap money
available, nobody can beat the Government at
offering cheaper money.
The financial aspects of the bill have been
opposed by the Federal Reserve Board, and the
boards objections, in the opinion of distinguished
members of the Senate's Committee on Banking
and Currency, have not been removed by COM
mittee amendments. The bill violates rules of
risk that private lenders must observe. Its effect
on bringing down the cost of housing is chal-
lenged. For billions of cheap money would be
poured into housing construction at time when
housing construction is already going at top
speed. The effect would be more likely to initiate
already inflated costs of construction than to
bring the costs down. And while ostensibly
singing out the middle-income group as the
group in special need of help, this bill Is singing
out group for which as much If not more hous-
Ing now is being built than for any other.
Responsible members of Congress will con-
slider this bill on its merits, and not because the
"real estate lobby" opposes it or the Democratic
National Committee favors it. If so considered,
1t ought to be defeated by healthy margin.