Evening star., 1951-05-24
FuIbright Proposal
10 Reorganize RFC
To Be Ready in June
By Robert K. Walsh

The Senate will receive from
its Banking Committee, probably
late in June, a bill to reorganize
the Reconstruction Finance Corp.
along lines proposed in a bill
sponsored by Senator .Fulbright.
Democrat. of Arkansas, members
predicted today.
The Banking Committee yes
terday completed public hearings
on several measures, with provi-
sions ranging from abolition Of
the agency to revamping of its
lending policies and administra-
tive procedures.
Senator Fulbright, head Of the
subcommittee investigating RFC,
meanwhile found himself the tar
get of what he called a revived
and inspired attack to try to get
even with me-"
Defends Letters to RFC.
Commenting yesterday on pub
lished stories that he wrote two
letters to the RFC in 194s in
behalf of loan for a bathhouse
project at Hot Springs, Ark, Sen
ator Fulbright noted that the
same stories appeared in many
newspapers last March.
He again defended his action in
writing the letters and said he
considered the 100000 loan for
the health resort lighthouses
owned by the Jack Tar Courts
was in the public interest. He
repeated his statement of last
March that he had not attempted
to force the RFC to take favorable
action.
The Arkansas Senator believed,
but was not certain, that former
RFC Directors Walter Cosgriff
and William E. Willett might have
had something to do with reviving
the stories and circulating the
letters.
Mr.. Willett denied any part in
the matter and declared II would
not stoop that low" Mr.. Cosgriff.
in Salt Lake City, also denied he
inspired" anything. He added
that if Senator Fulbright "is Of
the opinion that those letters
tend to discredit him and his in
vestigation, the only inference I
can draw is that he is ashamed of
his own letters and his own &C
tons"
The Arkansas Senator recalled
that he had made the letters
public. He said he was inclined
to dismiss the latest development
but he remarked that II suppose
there will be other attempts to
get even with some of us on the
subcommittee"
Witnesses at the final hearing
on RFC bills yesterday included:
Edward Stevens, Dawson, Ca,
manufacturer; Howard j. Stod-
dard, president of the Michigan
National Bank, Lansing, Mich;
Angus Mcdonald, who read a
statement from President James
G. Patton of the National Farmers
Union, and George M. Bazemore.
Waycross (Ga.) banker. All said
that RFC should be continued.
Favor Aid to Enterprise.
Mr.. Stoddard urged an arrange
ment whereby RFC loans would be
limited to participating with COM
mercial banks. Mr.. Stevens said
RFC loans to his enterprise in the
1930s not only rescued them but
were the salvation of the entire
community. Both witnesses
stressed the need for credit among
small businessmen.
Committee members indicated
that bills sponsored by Senator
Byrd, Democrat, of Virginia, and
others, and backed by former
Hoover to abolish RFC
are unlikely to be recommended
for Senate passage. Committee
action on RFC legislation is sched-
uled to follow the current hearings
on the Defense Production Act.
I'VE intend to report out a bill
in the near future and hope to get
congressional action on it at this
session." a member said. THE
bill that seems likely to come out
will certainly put restrictions and
safeguards on RFC and possibly
some limit on the size of loans, al
though not as low as the 100000
proposed by some witnesses"
Horrimon to Speak at VMl
LEXINGTON, Va, May "a. (P