Credos & Conundrums

"Reduction of costs of manufacture," cried President Roosevelt, proclaiming his economic credo to dining Democrats in Manhattan last month, "does not mean more purchasing power and more goods consumed. It means just the opposite" (TIME, May 4).

Last week the White House had some extraordinary visitors. Owen D. Young arrived for luncheon one day. Bernard M. Baruch turned up immediately afterward and Myron C. Taylor of U. S. Steel Corp. was reported to have dropped in after visiting hours that evening. Two days later Walter P. Chrysler lunched with the President off trays in his office.

Twenty-four hours after Mr. Chrysler had departed, curious correspondents trooped in for their week-end Press conference. Had the President, asked a newshawk, given his visitors any ideas on Business?

No, said President Roosevelt, he had asked them for ideas. What he wanted to know was how to make more jobs in industry. The problem, he declared, was to speed up certain industries for whose products there was large demand by people who could not afford to buy them. Railroad equipment and housing were good examples.

Everyone agreed, said he, that the rail equipment industry had a great field for expansion and that that expansion would go far toward reviving all heavy industries. Trouble was, though, that railroads were so burdened with debt that they were unable to pay even their fixed charges, much less to buy new equipment. Some people urged Government loans but that, declared the President, did not seem feasible. Some way, he suggested, would have to be found to readjust the railroads' capital structures, lighten their interest burdens. But he did not plan to do anything about it at this session of Congress.

Housing, he continued, was a different problem. He had asked Mr. Chrysler how much it would cost to build one of his $600 automobiles if it were put together piece by piece in a machine shop. Mr. Chrysler had said it would cost about $3,500. Housing, observed President Roosevelt, was still on a machine-shop basis. If there were only some way to put it on a mass-production basis and thereby reduce manufacturing costs so that houses could be turned out at not more than $2,500 each, he was sure that U. S. purchasers would snap up 500,000 to 1,000,000 of them.

Marveling at the change which the Presidential economic credo had under gone in a fortnight, correspondents marched out of the White House, filed dispatches which produced such headlines as:

ROOSEVELT SUBMITS JOB PLAN

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