Evening star., 1951-08-15
Senators Get Report
From Symington on
RFC Reorganization

Administrator Stuart Symingtor
today said the continuation of the
Reconstruction Finance Corp. is
essential to the preservation OF
the American system of free en-
terprise.'
/ Mr.. Symington testified before
the Senate Banking Committee to
give a progress report on the re-
organization of the RFC since he
became administrator, replacing 9
| f1ve-man board of directors.
| Before Mr.. Symington testified
the Banking Committee voted tc
send to the Senate majority anc
minority reports of its RFC sub
committee which investigated
charges of political favoritism ano
pressure in making multi-millior
dollar RFC loans.
This action was taken in q
closed session during which Re-
publican members of the commit
| tee abandoned efforts to sub
stitute for the mildly phraseo
majority report the minority
views much more strongly critica,
of the RFC its lending practices
President Truman; his aide
Donald Dawson, and Democratic
National Chairman William M
Boyle. jr.
To Be Released Monday.
Senator Capehart, Republican
Of Indiana told reporters that he
made no effort in the executive
session to substitute the minority
report for the majority since "all
I got were frowns."
Chairman Maybank announced
that both majority and minority
by reports would be submitted to
the Senate at noon Monday and
released for publication at that
time. He said he considered that
members of the committee and
reporters alike were on their
honor" not to disclose the con-
tents of either report before that
time.
He added that the committee
had voted, 8 to 5. to submit both
reports. There was no explana-
ton of the reasons for a split
vote. 1t was explained that the
vote of the full committee was not
on approving or disapproving
either report as such, but merely
on submitting both to the Senate.
Defends RFC Loans.
Mr.. Symington said the RFC
subcommittee hearings had raised
important questions concerning
the administration of the lending
agency and emphasized that steps
have been taken to eliminate the
causes of such questioning"
He acknowledged that there
were conditions in the RFC which
merited criticism, but he strongly
disagreed with those in Congress
who would abolish the agency en-
tirely.
What an absurdity," he said,
to imply that, because of possible
corruption resulting from ineffi-
cient management, a Government
agency should be abolished, re-
gardless of it's contribution to the
American people and their econ
omy.
1T would be just as logical to
say that the Department OF State
or Defense should be abolished
because several officials were
found dishonest"
Mr.. Symington defended RFC
loans to deserving businesses and
that it was the pur-
pose of the RFC not to compete
with private banking and to en-
courage bank participation as
much as possible.
Outlines Loan Policy.
Under the new loan policy
adopted since he took over the
of the agency, Mr
Symington said:
l. Every loan must serve the
public interest as well as the pri-
vate interest of the borrower. I"
such as contributing to the defense
program or providing essential
goods or services.
2. RFC loans must conform to
the Governments anti-inf1ationary
policies.
3. No loan may be made unless
the applicant can show in writing
that financing is not available
from banks or other sources on
reasonable terms.
4. No loans may be made to
bail out" other creditors.
5. No loans may be made to
luxury hotels or to places deriving
their principal income from the
sale of intoxicating liquors.