"NEW DEAL" SHOCKS

Evening Post, Volume CXIX, Issue 128, 1 June 1935, Page 9

"NEW DEAL" SHOCKS

PRESIDENT "AND COURT

THREE ADMINISTRATIONS

DECISION MEANS END

United Press Association— By Electrio Tele-

graph—Copyright. (Received June 1, noon.)

WASHINGTON, May 31

President Roosevelt has issued a statement declaring that the implications of the Supreme Court N.R.A. decision meant the end of the Agriculture Adjustment Administration, the Securities Commission, and the Federal Alcohol Control Administration.

COST OF -'NEW DEAL"

INCREASE IN PUBLIC DEBT

The remaining outstanding series of Fourth Liberty Loan Bonds, amounting to 1,250,000,000 dollars (£250,000,000) were called by the United States Treasury on April 15 for redemption on- October 15 (states the New York correspondent of the London "Times"). With this step the Koosevelt Administration completes its programme for refunding 8,000,000,000 dollars (£1,600,000,000) of Wartime bonds, and it is estimated that the resultant saving in annual interest charges will reach 100,000,000 dollars (£20,000,000). The decision to call the outstanding Liberty Bonds was announced by the Secretary of the Treasury, Mr. Morgenthau, on April 14, in a broadcast talk. Emphasising the scope and importance of the conversions which the Federal Government had undertaken during the past two years, Mr. Morgen--thau said that they had been carried through without any of the special appeals resorted \fy by the British Government when they embarked on a similar course. Painting an optimistic picture Of the future, Mr. Morgenthau went on to claim that the "financial logjam" was now conclusively shown to have' been broken, and that the country, was just on the eve of reaping the full benefits, of the Government's policy. "There is no longer any reason," he added, "why capital should not flow normally into the arteries of business again." GROSS GOVERNMENT DEBT. Turning to the heavy expenditures incurred under the "New Deal," Mr. Morgenthau pointed out that although the gross Government debt had risen to the record total of 28,800,000,000 dollars (£5,760,000,000), the cost of carrying it was less today than it was in 1925, when the debt was 8,000,000,000 dollars (£1,600,000,0000) smaller. Furthermore, about 1,700,000,000 dollars (£340,000,000) of the increase was represented by loans from which the country "may expect repayments in substantial amount which will go to reduce the Public Debt," while another 1,200,000,000 dollars (£240,000,000) was represented by tangible public assets, such as dams, roads, and buildings. Finally, Mr. Morgenthau stated it was now certain that the actual deficit for the two years ending June 30, 1935, would be 2,000,000,000 dollars .(£400,000,000) less than the original estimate of 9,300,000,000 dollars (£1,860,000,000). •• The Administration's crop control policy received another setback on- Saturday from the Courts, when the Kerr Smith Act regulating the production of tobacco, was held to be unconstitutional by Federal Judge Dawson, sitting at Louisville, Kentucky. It was understod that the Administration -would appeal against the judgment.