Garner v. Wagner v. Hoover

Federal relief for the fourth winter of the Depression last week became a matter of three-way compromise, with the House, the Senate and the President all at odds. Individual pride of opinion ran high. The White House threatened a veto if its will were denied. The Senate had "principles" it swore it would never surrender. The House, through its Speaker, raged and cursed to have its own way. Meanwhile the destitute of the nation trembled in fear lest they in their plight get nothing from a quarrelsome capital. Early this month the House passed (215-to-182) an omnibus relief bill backed by Speaker Garner. Using this bill as a parliamentary frame, the Senate struck out all the House provisions and substituted a measure of its own devised by Senator Robert Ferdinand Wagner, New York Democrat. Last week the Senate by an overwhelming but unrecorded vote passed the Wagner bill. As they went to conference, the Garner and Wagner bills were alike only in that each called for a public outlay of about $2,300,000,000 to make jobs, stimulate government construction and feed the hungry. The principal provisions of the two bills which had to be compromised by the House and Senate conferees were: Wagner Bill Garner Bill A $500,000,000 Treas-A Treasury Bond is-ury bond issue to be sue of approximately spent on Federal public $1,200,000,000 to be works already author-spent in buildings some ized. Major items (in 3,000 postoffices and millions of dollars): other government struc roads. 120: rivers tures, improving rivers harbors, 30; govern-& harbors, constructing ment buildings, 100: Federal roads, and to floodized. Major items (in 3.000 postoffices and millions of dollars): other government struc roads. 120: rivers tures, improving rivers harbors, 30; govern-& harbors, constructing ment buildings, 100: Federal roads, and to flood control. 15; Army be otherwise invested in & Navy housing, 25. a national public works The President was given program returning no $168,000,000 to spend revenue. A gasoline tax on public projects as he of Y^ per gal. is pro saw fit. None of this vided to amortize the c o n s t r u c t i o n w o u l d r e i s s u e . turn An revenue. increase of $1,-An increase of $1,- 500,000,000 in Recon 000,000,000 in R. F. struction Finance C.'s capital for loans sale"Corp.'s of its capital by the securities to ing"an}'State,person"--corporationormean- (which are indirect ob-individual, ligations of the U.S.) This is fund would be lent to States , counties , cities or public corporations to finance such self-liquidating projects as toll bridges, tunnels , via ducts, waterworks , docks and canals . Only two forms of private industry could borrow from this fund: limited- profit housing corporations fors lumeradication: construction concerns engaged to execute public works programs. Set aside also was $40,000,000 for the R.F.C. to help the Farm Board finance the export of its surplus. A $300,000,000 R. $100,000,000 worth F.C. fund to be lent only to States on the be President as distributed he by sees the fit basis of population for direct relief of the job among the jobless and less and needy.* needy. Chief defender of the Senate bill throughout the long nerve-wracking debate was its author and sponsor. Senator Wagner. German-born, he had served as a Supreme Court justice in New York City where he knew by experience the ex tent of destitution. When in 1927 he re placed Republican James Wolcott Wadsworth Jr. in the Senate, the State soon discovered it had not suffered by the ex change. Chunky, genial, levelheaded. Senator Wagner has been pounding away at Unemployment Relief for two years. Said he last week: "The Administration has waited for some miracle to come about to absorb the unemployed and unemployment has risen to a total in excess of 10.000.000. What has Congress done? We have brought about no recovery in business by any action so far and it is clear that private industry is unable to take up the slack. Thus far we have been smug, complacent, waiting for someone else. But the situation can't be met that way. . . . The primary purpose behind this bill is to help States and municipalities which are being forced to abandon projects because they cannot sell securities." The relief legislation had hardly gone to conference before President Hoover released a public blast against some of its provisions. His statement was accepted as a veto warning. The President was "glad" to see the "principle of generous relief to unemployment adopted." The R. F. C.'s $300,000.000 for State loans was "in line with major objectives I have been advocating," but it was "disheartening" that the money should be apportioned according to population rather than need -- a provision the Senate deliberately inserted on the ground that the determination of local "need" would lead to bureaucratic delays and political complications. But President Hoover's chief criticism was leveled against provisions in both bills for a bond issue for public works. At the beginning of the Depression the President used to stress public building as a major form of relief. When it failed to work, he turned against it. Said he last week:

"I intensely regret these major provisions . . . committing the Federal Treasury to the expenditure of from $500,000,000 to $1,200,000,000 for non-productive public works. . . . Any study will indicate their pork-barrel characteristics. . . . They are wasteful . . . not economically needed ... a squandering of public money. ... A deficiency [will be] created in the Budget [which] cannot be disguised by accounting phrases. . . . Ve have worked for four months in heart- breaking struggle to balance the Budget. ... To start now to break Federal credit will result in the eventual unemployment of far more men than this comparatively few benefited. . . . There is. however, a possibility of immediately rectifying these destructive factors and delinquencies. It is within the power of the conferees to rewrite the bill. ... I earnestly hope this may be done."

*This provision, once passed by the Senate as a separate bill, was reincorporated in the Wagner measure to get it into conference.

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