Show 0 national topics topic interpreted by william bruckart national press runding bunding walt washington hington ID C washington president roosevelt has come out again with a statement that the burden of no new taxes is regrettable tax levies and that there must be no new levies nor tax increase by the next congress he chose to get his views to the public by sta staging ging a conference en c e at the white house the other day when he summoned chairman harrison of the seri senate bite finance committee and chairman doughton of the house ways and means committee for a breakfast meeting to discuss the subject he followed this almost too quickly by releasing a statement a letter from secretary that substantiated the spoken word of liis ills two congressional leaders but somehow the word from the white house prompted many observers here to pick flaws in the pronouncement they began at once to find several places in the new picture that appeared to have been smeared over by the paint brush and in addition there was a sudden yelp from the republican national committee which did not help mr Roosevel ts plans to show the country that the tax burden had reached its peak the republicans were quite harsh because they called attention to the fact that mr roosevelt on three thre e previous occasions had assured the country there would be no new taxes and that in each instance new tax legislation somehow or other had been enacted by congress aside from the presidential declaration la that there would be no new taxes nor increases in the present levies and that there would be a study of the general tax structure the president made the point through secretary Morgen thaus letter that there were a good many hundred millions in recoverable assets he also urged upon the country that business has improved so rapidly that additional federal income may be expected from the present tax rates this latter of course is true providing business holds its own or moves to higher levels but it is with respect to the recoverable assets that many questions now are being asked for the sake of clarity it may be explained that the recoverable assets to which mr roosevelt referred consisted of the loans of federal money by the various emergency agencies for relief and recovery purposes there are the millions loaned by the reconstruction finance corporation the equally large amounts loaned by the works progress administration and the public works administration to states counties and cities for relief or for job making construction in addition there are loans by the home owners loan corporation the federal farm credit a administration d loans for crop production for marketing mark etin and countless other types these are all carried on the books as recoverable assets and their total may amount to as much as the policy of the new deal administration is to consider these at their face value it is the claim of the white house consistently that these loans will be repaid and that they can be used to retire an equal amount of the national debt which indeed is true if the loans ever are repaid so whenever the new deal is called on to defend itself against charges of imposing a gigantic burden of tax or an equally gigantic burden of public debt its spokesmen attempt to demonstrate that the public debt figure as well as the taxes must be considered i in n their relationship to these recoverable assets to explain the roosevelt position further one may recall that a month ago when the public debt reached the staggering total of the Trea treasury cury secretary contended in a public statement that against this sum there should be offset the cash assets in the general fund of the treasury then totaling and the of gold that is sterilized in what is known as the exchange sterilization fund in addition mr added in his statement we have certain assets representing obligations due us upon which the treasury will realize cash and which will ultimately be available for debt retirement ti these recoverable assets millions to home owners to farmers to railways to banks and insurance companies to states and cities now total more than these three items cash on hand stabilization fund and recoverable loans provide an offset of to the public debt it thus is made to appear directly in issue how completely the roosevelt administration calculates using these recoverable assets in retiring the public debt having gone so thoroughly on record it is difficult to see how there could have been such a mistake made as developed from the white house conference on taxes I 1 refers refer to the inclusion in secretary Morgen thaus letter of a reference to the recoverable assets as one of the reasons why no new taxes will not have to be levied some critics have stated boldly that the white house statements on the recoverable assets cannot be justified their assertion is that it if the treasury properly included recoverable assets as a thing to be used in offsetting the public debt then by the same token those recoverable assets or repayments of them cannot be used to reduce the tax burden in n other words the money represented by those assets cannot be spent in two different diff lerent ways either it must be used to retire public debt or it must be used for current spending by the administration it seems to be simply a refusal to believe the old adage that you cannot have your cake and eat it too if I 1 should attempt to analyze the situation in the light of a personal equation I 1 think I 1 might properly say that it if I 1 loaned to a friend and at the same time if I 1 borrowed from a bank I 1 might properly say the loaned to the friend could be used to pay off the bank loan so far so good but if the friend repaid to me and I 1 spent that and had no other resources I 1 cant quite figure out how I 1 would pay the bank the 1 I had borrowed from that institution although perhaps my worries worries as an individual about government policies may not be very important because I 1 am just one individual I 1 entertain considerable fear about those recoverable assets in another respect for some reason and I 1 think I 1 can state lt it I 1 doubt that a very large portion of those recoverable assets ever will be collected I 1 have a hunch that in the next fifteen or twenty years the bulk of those debts which the roosevelt administration counts as repayable will be cancelled or defaulted in either event I 1 think I 1 see how politics is going to play an important part and I 1 am convinced further that mr and mr roosevelt as well if he shares mr Morgen thaus belief is overlooking that very vital influence when he holds these loans as likely to be repaid 0 0 I 1 recall that the late albert C ritchie four times a democratic governor of mary default land predicted that likely the money loaned for the various purposes outlined above would never be paid back indeed governor ritchie who was a very practical man and who thoroughly disliked deluding himself used the word repudiation in connection with these debts he said they would be handled just like the of war loans made to european nations it is a noble thought of course that the loans will be repaid yet it is quite apparent that a cancellation drive is already under way I 1 think most of those who do me the honor to read my column will recall that more than a year ago I 1 directed their attention to the reduction in interest rates w which congress had ordered on many of the loans that is simply the first step cancellation proposals undisguised are bound to follow I 1 unless I 1 am mistaken the astute jesse jcsse jones chairman of the reconstruction finance corporation and a man who never kids himself already has kissed goodby good by to many of the millions that have been loaned by his agency of course the reconstruction finance corporation carries those loans on its books and counts them still st 1 n as a s valid val but I 1 am of the opinion n 0 n that mr jones probably regards those items as dead debts but to go further with the idea of cancellation it takes no stretch st r etch of the imagination to say that the home owners loan corporation for example will soon have a good many thousand foreclosed properties on its hands it takes no more imagination to say that politicians who have ridden into office with promises to help those people whose homes have been foreclosed will carry out their promises by further voting interest reduction or curtailment of principal A more striking illustration it seems to me can be found in the case of the loans to states cities and towns who among the politicians is going to have the courage to resist the tumult and the voting of their constituents to avoid increase in their local taxes when they call for cancellation of the loans while the bonus for the ex ice men is a dead issue every one knows how representatives and senators capitulated to the demands of the veterans lobby picture for yourself if you will how much stronger the demand will be when a whole community sets up a howl how to have the funds it has borrowed from the federal government finally declared to have been just a gift and not a loan w i Nor union |