The Atlantic Report on the World Today: Washington

ON THE WORLD TODAY

Most of the members of Congress have gone back to their districts to prepare for November. It is, of course, election year, and well we know it in Washington. Not one but several measures essential to victory are waiting till the electorate has spoken. The lowering of the draft age (which, with the realization that the war will last a long time, is inevitable) is one such measure. Another may be the tax bill, at least a general sales tax. Some say that nation-wide gas rationing will likewise be held over for the same reason. This spectacle of “politics as usual ” has built up a backfire in the country at large which is causing pain and anguish on Capitol Hill. Seldom has Congress been held in greater disesteem.

Yet a lot of the blame directed at Congress properly belongs to the Administration. Take, for instance, taxation. The current bill has been built up on the Treasury’s recommendations. And these failed utterly to jibe with the designated aim of wartime taxation, viz., to mop up war income. Secretary Morgenthau stated the fiscal problem in these words: “to withdraw the greatest volume of purchasing power at this time, when money incomes are high and the quantity of goods for civilian use is shrinking day by day because of the demands of our war effort.” The goal, in other words, was to arrest inflation. How did the Treasury go about it? By proposing levies which in the main fell on savings rather than income, on production rather than consumption. In this theory the House followed the Treasury’s lead.

Under the House bill much of the profit in war jobs is left in the workers’ pay envelopes. Indirectly as well as directly, the Administration gave the bulk of the spendable income a wide berth. That is to say, it refused to tap it by means of a general sales tax. “Not till November,” as they say in the corridors. Say what you will about Congress, the House showed more courage. At least the legislature did broaden the base of the tax on personal incomes. And, but for the Treasury’s frown, there might have been an effort to enact a sales tax.

CONGRESS AND LABOR

Nor can Congress be blamed for the shilly-shallying on labor. The House wanted to curb the tyrannical power of labor leaders like Petrillo. Mr. Roosevelt prevented action. There can be no doubt, moreover, that he refused to permit any wage stabilization worthy of the name to appear in the price-control bill. He wanted to stabilize wages through the War Labor Board, though this board vacillated so long that even Congress got restive. In a debate on July 23, Senator O’Mahoney was only one of several Senators to denounce the Administration for “puttering around” on wages.

A policy on wage stabilization, to be sure, has come out of the War Labor Board — in the ruling on the Little Steel case. But it affords no help in arresting inflation. The rise in living costs between January 1, 1941, and May 1, 1942, is to be made up to labor in wage increases. That increase is about 15 per cent. Such a policy, by maintaining instead of reducing living standards, simply shifts a new burden to the tax weapon. We shall have to levy stiffer taxes than ever on war income.

Some of the war administrators think that inflation can be held off by more rationing of goods rather than by mopping up money. In that way money could be just as effectively immobilized. There would be no money competition for goods — that is, inflation — because the goods would be apportioned among the population. The theory has a certain plausibility. The trouble with it is that the pressure of surplus incomes would bring an immense black market into existence. Some such bootlegging already has appeared. The spur to the creation of this underground economy would obviously be lessened by the immobilization of money in the national exchequer. And that is a problem far more for the Administration than for Congress.

THE FARM BLOC

Still the fact cannot be gainsaid that “politics as usual” reigns at the other end of Pennsylvania Avenue. If wages were left floating in the pricecontrol bill, so (virtually) were farm prices. It may be that some of the Congressional concern for the farmer is traceable to the desire to equalize the White House concern for the industrial worker. At any rate, Senator George makes out a pretty good case for that thesis. Caught in a vise between higher prices for city goods and mounting wages for farm help, the farmer can get relief only from higher farm prices.

There is enough evidence, however, that the farm bloc in Congress has been engaged in exploiting the war in behalf of the nation’s farmers. Putting farm prices virtually in a class of untouchables in respect of Mr. Henderson’s price-fixing administration is only one example. Congress later sought to exclude commodities processed from farm products. The agitation was squelched only by a vigorous fight put up by the gallant and long-suffering Price Administrator. Indeed, the history of the farm bloc this session has been an unending fight to obstruct the war program. That was certainly the case with the so-called parity fight.

In reality this fight was directed at the conversion of agriculture to war work. The Administration had worked out an admirable plan for making this country the granary and the larder as well as the arsenal of democracy. Secretary Wickard calls the plan the Food for Freedom program. The entire emphasis is upon the stimulus to meat and dairy and fat production. To produce more meat, more eggs, and more lard for the Allies, the American farmer must be assured cheap feedstuff. This could be done by selling out of government warehouses at below parity prices some of the grain stocks accumulated under the Commodity Credit Corporation loan program. But the farm bloc would not hear of it So adamant were they that they persuaded the House to tack the ban on the appropriation for the Department of Agriculture. Eventually the White House objection prevailed.

We don’t know yet whether a bargain was fixed up behind the scenes. But it looks that way. A Senate vote of 100 per cent parity loans to the grain farmers in place of the existing 85 per cent seems to have been accepted at the White House as a quid pro quo for prying loose the farmer’s death-grip on the Food for Freedom program. That, at any rate, is the supposition in the Capital. We shall know for certain when the House acts on the Senate measure.

Such a bargain would make the farm program ridiculous. Parity loans would put up grain prices to parity. So a farmer would be enabled to transfer his wheat to the government at a price of $1.35 a bushel, and simultaneously buy back wheat for feedstuff purposes at 83 cents a bushel. That would be a tidy windfall, as well as a reductio ad absurdum. But what else can you expect from the Administration’s policy of trying simultaneously to prevent inflation and to boost farm prices?

The last antic of the farm bloc at the expense of the war effort came over synthetic rubber. Our farm politicians feel that the oil companies are getting the lion’s share of the new business. They feel that alcohol from grain should be used more for making ersatz rubber. Accordingly they voted to set up another agency in addition to the War Production Board agency to exploit the synthetic rubber possibilities of America’s farms. In vain Donald M. Nelson protested. The farm bloc were determined to horn into the synthetic rubber business. President Roosevelt, however, vetoed the bill, as was inevitable. This the President had promised. For the effect of the measure would be to create confusion of administration, divert critical materials from war use, and generally bedevil Mr. Nelson’s job. This piece of Congressional obstructionism did not improve our legislators’ standing in the eyes of the citizenry.

The circumstances of the vote, moreover, accounted for much of the howl against Congress which is beating upon Washington. The vote made onlookers wonder what will be the end of this kind of constitutional evasion coming on top of this kind of sectional legislation. Certainly it strengthens the Executive branch in the eyes of the American people. That is a good thing from the standpoint of the smooth conduct of the war. But it is a bad thing to see our own legislature in disrepute when all representative institutions are on trial in a world war.

SILVER: A CONSCIENTIOUS OBJECTOR

Perhaps the worst example of pressure politics on the Hill is the silver bloc, which works hand in glove with the farm bloc. Silver is the only metal that has not been enlisted for war. Ordinarily there is not much use for it. But now it could end a multitude of bottlenecks in making up the deficiency of tin and copper and other metals. Canning factories, so essential to the Food for Freedom program, are closing down for want of tin solder.

Silver could take its place. Fifty tons of silver could serve instead of 2000 tons of antimony in, for example, the positive plates of storage batteries.

Silver could be employed as a coating in such things as tank cars and dairy equipment.

Yet the silver bloc says “hands off" the Administration’s hoard — the only real stockpile of anything with which we entered the war — when the suggestion is made that the Treasury might lend the metal to war industry. To be sure, part of the hoard has been lent for making bus bars in the new aluminum and magnesium plants. But beyond that concession the silver bloc won’t budge. This is the real legislative crime of ‘42.

The trouble with Congress is that it has not yet joined up. True, the legislators work hard, and many of them, either individually or in committee, are rendering invaluable service. I pick out particularly the Tydings and Byrd Committees, which are engaged in seeing that the Executive agencies are converted to war work, and nothing else. But in general the charge is difficult to rebut that special interests have actually been fomented under war pressure and war extravagance.

There is likewise much room for improvement in the organization of Congress. It needs to be put on a war footing in the same way that the Tydings and Byrd Committees are putting the Administration on a war footing. The time wasted by our war administrators in giving the same evidence to two or more overlapping committees is endless. Two committees investigated the loss of the Normandie. There is repeated duplication between Senator Truman’s Committee and the three subcommittees investigating various aspects of the war production program for the House.

The suggestion has been made that Senate and House committees, standing and special investigating, unite for the duration. That is not too much to ask. But a Senator to whom this correspondent made the suggestion threw up his hands in consternation. Yet at least one committee has undergone precisely such a metamorphosis. That committee is the joint Congressional committee for the reduction of nonessential expenses under Senator Byrd. This represents two House and two Senate committees as well as the Budget Bureau and the Treasury. During the war, joint committees ought to be set up whenever the Senate and House have common interests in obtaining information.

Reform of this nature as well as a national outlook in the conduct of the business of Congress will doubtless be demanded by the electorate. There are far more bottlenecks in Washington now than in the country at large.

They are not all political, either. Administratively there has been a lack of foresight which Henry J. Kaiser, among others, has shown up. Mr. Kaiser’s visit to Washington was like a breeze. He reminded everybody who listened to him that the word “ impossible” had never before appeared in any American dictionary. Here was a man who had accomplished the impossible in, for example, turning out ships in record time with secondhand machine tools which he had simply swept up from all parts of the country. As for raw materials, you can’t tell him that this country is short of them. He believes that the shortage problem is simply an excavation problem and he has demonstrated this belief already by digging up chrome ore in California. Mr. Kaiser has shown that administrative confusion and lack of organization may be responsible for some of the bottlenecks which have stopped more than one vital project.