Show I L Prevailing Opinions I Comment of the American Americ n Press A Conflict Removed The abolition o of the office o of special trade adviser to the president president dent marks the end of an Intra- Intra administration conflict between en Goorge George N. N Peek who has occupied occupied pied that position for close to two years and tho the department of state Mr Peek has on numerous occasions occasions occasions oc oc- oc- oc expressed his disapproval disapproval disapproval of the methods followed by the state slate department in negotiating reciprocal trade agree agree- ments Instead o of favoring the tho extension of concessions made to toone toone one ono country to all others that do donot donot donot not practice d discrimination Is c rim i n a t ion against us In accordance with the most favored nation principle he has consistently advocated bi bilateral bilateral bilateral bi- bi lateral bargaining of or a mutually I exclusive type Regardless of the merits of the arguments for and against this rival method It is obvious that the situation created by open disagreement disagreement disagreement dis dis- dis- dis agreement between the responsible responsible responsible sible heads head of two accredited federal federal federal fed fed- eral agencies could not be permitted permitted permitted per per- to continue Indefinitely While the office of the foreign trade adviser has offered the public public pub pub- lic lie virtually no information that had not already been made accessible accessible ac ac- ac- ac through the statistical and research departments of es established established established es- es government agencies it has been useful in calling attention attention attention atten atten- tion to the losses of ot extensions extensions ex ex- tensions of credit in the past vast Tho The emphasis upon the need for testIng testIng testing test test- ing the ability to pay of countries countries countries coun coun- tries to which we sell goods is Li corn commendable rn end able For that reason the retention of Mr Peek as president of ot the ex ex- port-Import port banks offers guarantees guarantees guarantees guaran guaran- tees against a dissipation of publIc public pub pub- lic lie funds In efforts to revive un- un remunerative foreign trade It would not however warrant use of these banks to further Mr Pecks Peck's plans pians for placing our foreign foreign for for- eign trade more nearly on a basis of or direct barter or fostering trade expansion chiefly with countries having a a. favorable trade balance with the United States Since the state department plans for expanding foreign trade are now the only officially recognized recognized recognized method of or procedure it Is to tobe be presumed that Mr Peek will do his utmost to make his banks effective instrumentalities for carrying carrying carrying car car- out those thos policies Wash policies Vash Wash Washington ington Post Tax-Exempt Tax Loophole The treasury deserves praise for cutting down the governments government's debt carrying charges at a time when tho the debt is mounting to a 3 record peak But in subs substituting lower Interest bonds for more costly obligations the treasury is shortsightedly perpetuating a fundamental weakness In our governments government's governments government's gov gov- finance methods We Ve refer to the tax e tax exemption guarantee written on the face tace of at new as u well as old issues The tax-exemption tax doubtless makes the government bonds more at attractive attractive attractive at- at than they would be other other- wise vise But there are other and we be believe be- be lieve more compelling ng reasons why tax-exempt tax clauses should be deleted from the face of or future government issues Tax free bonds make mockery of our federal Income tax rate schedule A man for example who has an earned income of has to pay a federal tax ux of almost Another man with the same income income but but with a a. large share of ot it coming from tax- tax exempt sources can get off oct with a tax of ot say Thus is our to pay yardstick reduced to absurdity From a range long-range viewpoint a perhaps even more cogent argument argument ment mont against tax free financing is the need of removing govern- govern mont temptation to spend beyond its means A favorable bond market market market mar mar- ket is not an unmixed blessing Legally the government cannot erase crase the tax-exemption tax clauses on its securities now outstanding But It can eliminate the clause from future issues Constitutionally Constitution Constitution- ally the government cannot tax incomes from either cither outstanding or future issues of ot state and local gov government bonds But con res can propose a n constitutional amendment and should do so- so News without delay San San Francisco II |