| Show r INSIDE I t x STUFF Politics I and Finance WASHINGTON By Dr Paul rani Mallon 2 Copyright 1933 by Paul Mallon There was more than a whim behind behind be be- hind the extraordinary manner in which Professor Groves of Wisconsin was as officially beheaded as adminis- adminis ration master mind on taxes Groves was was was' hired by Treasury Secretary Sec See Woodin to work out a federal tax reform program He had not yet arrived at his desk when Treasury Director Di Di- rector fired him without explanation and hired Professor Roswell Ros- Ros well Magill of Columbia in his place The matter w wa hushed up effectively lively ely in the rush of what appeared it to be more snore important business PARTISANSHIP The under underlying ying cause was the fact that Professor Groves is a pal of oLSen oLSen- Sentor Sen- Sen tor ator tor La Follette That would not riot disqualIfy disqualify dis dis- dis qualify quality him but he also is an 10 tate of ot redistribution of wealth through inheritance taxes He drew the La Follette tax plan It Itis is more likely than you know that the administration will get around to toI I- I like the Groves ideas of oft taxation within the next year But Buthis Buthis Buthis t his his appointment was a tactical blunder blun- blun der It was an announcement that the tax lax question would be studied by bya t a biased partisan who already had a t plan Ian After Alter all some display of open open- mindedness must be made about such suchS such'S S 'S things The howl that went up Inside was f uproarious ROOTS BOOTS I The new man Magill is a lawyer He is not trad trade marked ma k d with any announced announced announced an- an theories It is assumed he heil heI I will il give the problem a more open- open I r minded study The announcement i that he lie is going only into the technical I cal eal administrative features of taxation taxa taxa- s tion was designed to quiet the frightened fright fright- coed ened big taxpayers The truth is that will send him after the roots of the whole federal taxation system Everyone u knows kows he will find that the present system is not well balanced that it does not provide a proper flow of 5 revenue It will be his job to figure IT 17 olit a new o ethe burden bur bur- f 1 den of the man on the street and afford aford aft af af- af- af t ford ford ord the government su sufficient Ci lent funds I to ta operate efficiently f FINANCING N N ING J I. I t v The TheR R F C boys have bave been in a huddie hud hud- J die for days now trying to work out f new idea for commercial loans j They w want rant t t to get away from their announced policy of lending money to to i industries through special mortH mort mort- H I gage companies Their idea is that a system might not be efficient f f They want to lend money directly to tot t- t the industries That point is very important now because banks are tied up against the capital financing market more strictly 1 than they have ever been before Likewise It is isnec necessary ary that the gOr gov- gov r balance its N R A demands i with an offer oHer of money to industries which want capital financing jf The big question Is to find a legal r r excuse for making direct govern- govern t l ment loans It may be necessary to toj j confine the loans to moderately long term periods Any Ariy step in that tion means further government Inva- Inva 1 Lilon of ot the banking business 2 TORPEDOES t t tf A chain letter attack on the admin admin- t c f f str tion money policy has been J. J secretly by several bankers t in the larger cities They are writing k th their ir friends to write other friends pointing out the evils of easy money This Thi campaign may prove just asas as effective as the open barrage being conducted by the Sprague Smith Baruch and the f f c ties of If the UnU United d States Chamber of i l Commerce i 1 They have a good chance of ot crous crous- 5 lag Ing Z a large section of the populace l' l by t y the time congress meets In Janu Janu- t ary arr Their job Is obvIously to ye- ye t form forni the conservative ran s which I constituted a majorIty of voters teu But what Influence that will willS c r S have l-kIve l on congress is another matter The anti are sparsely represented represented rep- rep r resented on Capitol hill CZ I Th Tie The old line about bout letting George oo do it Is being revised by br Mr Roose Roose- let to let Henry do it The cent t Intended to make Henry Morau Mor Mor- au czar of the distilling kingin king- king dora m in addition to his other duties heard about it and ant ran to Louis Howe In an effort to sLot the announcement Howe called called Warm Springs on the telephone I and md saved ra we e treasury director from that job tED TAPE i he bc 5 way wy the news re re- are arc working out is not at III all satisfactory to newsmen It has hasa b a d the effect of scaling sealing all lips in the treasury department Even the J agents of firms dealing with tb government are arc complaining that that Vie the treasury officials are so frightened fright rIght tried tIled they dare not open their mouths The result Is a ridiculous t amount of f- f fred red tape It takes o much 1 y lonzer to get even the simplest Information in- in formation through the thc official news i J Another factor is that some of the Continued 3 on Page Paie Two Twos 4 L INSIDE STUFF Politics and Finance Continued from Pace Pae One 1 men being installed in new publicity jobs do not know Washington and its ways was Neither are they expert in their departments It is all new to them and somewhat confusing contusIng The powers that be continue to cling to the system expecting it will work workmore workmore workmore more officially later on For the present pres presS ent no authorized official would dare to give anyone the thc time of day NEW YORK By James McMullIn J I Copyright McClure Newspaper Syn Syn- I IThe The New York-Washington York sound money fight is setting the thc stage for a al 1 huge civil war in New York Itself The stake will willbe be financial leadership of ot the metropolis and all that goes with it in the way of power and prestige On one side Rockefeller interests with the Chase bank as spearhead On the other the Morgans battling to hold their place in the sun and still powerful despite rebuffs The feud between them is due to pass from sniping to a major engagement You might think the Wiggin revelations would have cramped the Chases Chase's style Not at alL Aldrich's finale to the Chase hearing is planned to leave leavea a sweeter taste in Washington mouths and also fling a hot gauntlet in the teeth of ot New Yorks York's financial over over- lords Thinly veiled old lin line sponsorship of the so sound nd money moncy campaign gives the the- Rockefeller forces the break for tor which they have been waiting They will fly the new deal flag at their masthead You haven't heard the Chase complaining about monetary policies and you wont won't ALLIES Most of the banking community will string along with the Morgans Morgans- partly because the magic of the name still is potent and partly because of privately expressed distaste for Rockefeller methods The stock exchange exchange ex ex- ex change crowd Is less under the Morgan Morgan Morgan Mor Mor- gan spell but its leaders are mostly inclined to play traditional leadership on the nose Also there will be some pretty important industrial backing in this army But dont don't get the idea the thc Rockefellers lers ler will be without allies Watch the Du Ponts They have successfully avoided the path of new deal storms I and there is JS no love lost between them and the Morgans They also have ambitions ambitions' John J. J Raskob Is Ismore ismore ismore more in the picture than is generally I supposed It is no accident that he visited Warm Springs while his erstwhile erst erat- while candidate Al Smith was sounding sound ing tag of off about the boloney dollar A Stand Rockefeller ard Oil Oil-Du Pont General Motors setup set set- up however up-however however informal could Informal could make giant money combinations of the pas past look like pygmies CONVERT Al Smiths Smith's espousal of orthodox money was hardly a surprise He has played very close to the thc bankers bankers- which includes Morgan bankers bankers- since 1928 His County Trust company company company com com- pany just missed the thc front pages before be fore tore it was silently absorbed recently Wall street would have considered Al a perfectly safe candidate in 1932 He had secret backing of some importance im jim parlance at t Chicago not Chicago not that it di did him any good Moreover he has been helped over over financial rough spots a haven't changed my ray mind about the I ISan San Jose affair While the governor refused to I commit himself when asked whether he thought q majority of citizens of the state favored his stand he indicated in ln the preponderance of ot favorable favorable favorable favor favor- favor favor- able telegrams still pouring into his office showed he was well backed in his move to drive kidnapers out of California couple of times by established finan finan- cial ial interests This doesn't imply that Al has sold out ut to the thc bankers Wall street methods are arc more subtle than that He has simply inhaled their point of view lew to an on extent where he is now one nc of them Tichenor publisher Tichenor-publisher publisher of the thc New Outlook and LaGuardia's comrade on his lis vacation trip trip harks harks back to the Morgan lorgan office Those astute people are re believed to have helped Smith to tolis his lis editorship Now the New Outlook Out Out- look ook needs glasses and Al is a bitterer man than ever SPLITS The division of opinion in New NewYork NewYork NewYork York on the presidents president's gold policy is growing sharper every day and the presidents president's program Is is gaining con- con verts erts A top flight brokerage house recently turned heretic enough to state tate that bondholders have no cause for or dismay if their purchasing power does docs revert to the thc 1926 level and r re reminds reminds re- re minds them that they thought they were pretty well off then Another reason for Wall streets street's shIfting base is the slump in stock and nd commodity prices that follows 1 every very time sound money ideas seem to o be getting the upper hand The boys joys do like their profits and if jacking jack jack- fag ing ng the price of ot gold will bring them they're heyre for It TACTICS Sponsors of the orthodox money program have decided it isn't so bright right to attack the president direct direct- lYe ly y From now on their tactics will assume that the thc president himself is O. O K but his professorial advisers are arc cockeyed and wont won't he please give hem the bums bum's rush 1 Neutral observers comment that if ii and when he does it will not be on New York advice STABILIZATION Local observers think they see signs igns of informal cooperation with Great Britain for stabilization They expect it to take place within the not remote future around the old parties for tor dollar and sterling But gold prices rices for both will be higher than formerly One school of experts says that the longer this this' is postponed the more likely it is that other issues will arise to o make for a lower instead of ot a higher high er price for gold than that which now prevails SIGNERS The Crusaders Crusaders' plan for fora a national sound money campaign in conjunction conjunction conjunction tion with th the legion and the federation federation federa federa- tion of Wi la labor or suffered a sharp h rp setback when their Carnegie hall hail meeting turned out a frost Even granting that hecklers were planted there was wasa a notable lack ot popular enthusiasm The program for nationwide public meetings may be curtailed or even abandoned in consequence But they still are after aUer a tremendous flock of college professors' professors signatures SIDELIGHTS ITS I IThe The sound drew their bitterest d disappointment appointment in the reception recep tion accorded to Al Smiths Smith's views They never expected to see the day when he was booed in his home hometown hometown hometown town Father Coughlin won a round one-round knockout over the thc Crusaders Crusaders Cru Cru- sOlders in his meeting the same same night He drew thousands more people and many less jeers You hear talk in some quarters about tossing in n the sponge noni |
