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Show PRESIDENT SETS GOAL of ECo;:or.iic sunvEY- 'LASTIilGJROSPERITY' Hat Need for Capital Goods Investments Dropped? , Are Savings Entering Nonproductive Enterprises? Enter-prises? Executive Asks , ; WASHINGTON, May 16 (UPjPresident Roosevelt Mid. today that If the United State it to have lasting prosperity, It must adopt measures "which will bring together idle men, ma- chines and money." In a letur to Chairman Joseph ' C OMahoney D, Wyo.) ef the temporary national economic (monopoly! (mo-nopoly! committee, the president said h hoped the "savings and investment" in-vestment" study started by the com- ' mittea today would "asamue the task ef analysing the financial machine ma-chine In Its relations to the creation crea-tion of mora needed wealth." The president posed two questions for the committee to answer, saying say-ing be knew of "no more urgent . ones la the country today." Asks Two Question The questions, relating to the lack of a flow of capital Into pre- ' ducttvs channel, were: j , -To Ik htopaMna our ftrnnnm la leaving aa era of rapid expansion and entering aa era of steadier growth, calling for relatively less investment In capital goods T . "Is It saoause of !, leak and friction In the operation of investment invest-ment markets which prevert the normal flow, of savings into noa-produetlve noa-produetlve enterprise!" Th president amid that this coun- ; try has "developed several method , of connecting money with men and materials so as to get useful work , done." f i ..... . . . "W shall need to use all ef these opportunities, or, if you choose to put It differently, w must meet all ' of th demand mad on ur system, ' if w are te have lasting prosperity. pros-perity. Paints Solution "It Is eur task to find and energetically ener-getically adopt those apecifia measures meas-ures which will bring together idle men, machines and money. la proportion pro-portion aa w succeed, we shall strengthen th structure ef Democratic Demo-cratic economy." Professor Aivln H. Hansen of Harvard university, opening a "man-in-the-street" study of do- ' presslon causes, submitted to th national monopoly Inquiry .today a four-point program - designed te tart th flow -of "Idle money" and prevent "chronic unemployment" Hansen said ha could find "no slm pi solution to the problem of how to "get an adequate volum ef Investment expansion." Aa part of a proposed "attack from many angles," be proposed that the government: L Stimulate private expansion of productive equipment and new construction. con-struction. X Crests a railroad equipment company, financed en a self-liquidating basis by government funds, to purchase new railroad equipment and leas it to th earriara aa and when needed. S. Reduce the guaranteed inter-eat inter-eat rat allowed under the federal housing administration. 4. Reform thoroughly th tax structure. Hansen testified after Peter R. Nehemki Jr, special aeeuritiea exchange ex-change commission counsel, out- (Coathitiod on Pxxv four) (Column Six) PRESIDENT SETS ECONOMIC GOAL " (CeaUnaod Frees Pace Om) lined purposes of tba inquiry Wild will bring outstanding industrialist! and Wall atraat Investment bankan to tha wltnau stand. "Today and throughout thea hearings." Nehemkls said. "we shal ba discussing with you a singli problam: Why la It that wa coatinua coa-tinua to hava in thia country idle men, idle machines and Idli money T Replying, Hansen said: "It la my opinion that wa can overcome the current ehronio unemployment un-employment problem orrfy by supplementing sup-plementing private investment with public Investment on a considerable scale. "Without thla. It la not likely-tbai ' wa shall absorb our full flow of savings, put them to active use and raise our national income above , the current chronic stagnation level. Self-Liquidating "Some public investments are self-liquidating in character. These offer no difficulty with respect to financing, and about these there can be, I think, no serious ground for controversy. Tet because of an ing, we have dumped even these expenditures into our ordinary budget and mistakenly counted ourselves our-selves poorer by reason of tha public pub-lic debt incurred to finance these projects. "Public Investment In human resources re-sources can ba equally productive. Outlays for hospitalisation, public health, pollution abatement and sewerage projects, public education and public low-coat housing may be no elss productive than outlays en natural resources. Balanced Budget "Properly apeaking. tha budget Is in fact balanced if tba taxable Income In-come and taxable capacity are ample am-ple to cover the amortisation and interest charges incurred by any given capital outlay. "A considerable part of publlo Investment In-vestment could quite well be paid from taxation provided the taxes were so levied as to fall on savings snd not on consumption. By this procedure the aavings stream is forced directly Into Investment Instead In-stead of being tapped voluntarily through the borrowing process. "We need above all to find adequate ade-quate outlets for our flow of savings sav-ings Into plant expansion and new construction, if we are to avoid chronic unemployment.1 |