Politics v. Economy

Political economy, as every taxpayer knows, is not the same thing as economical politics. President Coolidge. shrewd politician, made a great reputation by ding-donging the nation on cutting the cost of government. Yet between 1925 and 1929 Federal expenditures rose from $3.546,826,897 to $4,559,931,993. Under Presi dent Hoover, shrewd economist, the Treasury's cash outlay climbed to $4,951,160,738 in 1931. Typical of widespread popular exasperation with Federal costs was a speech made last week by loud Col. Robert Rutherford McCormick, editor & publisher of the Chicago Tribune ("World's Greatest Newspaper"). Angrily cried he :

"National expenditures are exceeding in come by 100%. ... No serious thought of retrenchment appears to have entered the heads of our office-holding tyrants. . . . If you are to exist, you must tear these weasels from the throat of the nation. . . . There is not a Cabinet officer, there is not a member of Congress who can demonstrate that one-half of the money appropriated for any department is used for the purpose designated. Not one-half of the money appropriated for the War Department is spent to make an army. . . . Not one-half of the money appropriated for the Post Office department is spent to move the mails. The departments of Commerce, Interior and Agriculture are not much better than rackets. . . ."

Washington last week seriously bestirred itself in the general direction of economy. Large were the necessities for action. Last December President Hoover, proud that he had pruned out $365,000,000 in unnecessary expenditures, submitted to Congress a budget calling for $3.996,000,000. Revised estimates and supplemental items later advanced this to $4,112,000,000. To balance the Budget (exclusive of public debt retirement) a billion-odd dollars had to be raised by new taxation and another 200 millions saved in appropriations. Where and how was this economy--5% of the Budget--to be effected?

Fortnight ago President Hoover asked Congress to join a general conference to work out a national economy program. What the President really wanted and what Congress had no immediate intention of giving him was blanket authority to reorganize and consolidate the executive Government as he saw fit. Democrats answered the Hoover message last week by challenging the President to specify what cuts and consolidations he had in mind, to accept his constitutional responsibility of recommending changes to Congress.

Committee. President Hoover took up the Congressional challenge for specifications of economies and invited to the White House an informal House group known as the Economy Committee. To the meeting also went Secretaries Mills and Wilbur, Postmaster General Brown and Director of the Budget Roop. Most taciturn of officials, Director Roop was asked if what he was carrying in his fat brief case was the Budget. Replied he: "What's left of it."

For six hours the President and the House committee sat around the Cabinet table discussing ways & means of saving money. Mr. Hoover's main point was that Congress should amend certain laws to reduce mandatory expenses rather than snipe at the appropriation bills. The House committee wanted to merge the Army & Navy into one department of defense but the President would not even listen to such a proposal. A general 11 % cut in Federal salaries was favored by the Congressmen. Mr. Hoover countered with a proposition to cut the salaries of the President ($75,000 per year), Cabinet members ($15,000), Senators and Representatives ($10,000) but to furlough other employes without pay and reduce their vacation and sick leave from 30 days to two weeks. Thus the bargaining progressed back & forth, with little discord and no politics. When the meeting ended the House Economy Committee had tentatively agreed to consider a list of changes which, if enacted, were estimated to save between $160,000,000 and $210,000,000. Among them were:

Change Saving

Retirement of all superannuated employes $3,000,000

No extra pay for overtime or night work: no more automatic promotions 10,750,000

Closing naval land stations 3,000,000

Payment of the Philippine Scouts by the Philippine Government 5,000,000

No more state aid for vocational education 8,500,000

Suspension of all lines operated by the Shipping Board 7,500,000

Reduced holidays and sick leave 35,000,000

Reduced allowances to rural mail carriers for motor maintenance 17,500,000

Undetermined Veterans' savings 80,000,000

The Hoover method of economizing-by-committee failed to win the support of Liberal Pundit Walter Lippmann, once the President's close friend, now his keenest critic. Writing in the arch-Republican New York Herald Tribune last week Pundit Lippmann declared:

"Mr. Hoover has been President three years and apparently the manner in which the American Government operates is still a mystery to him. . . . Mr. Hoover's record on the Budget is one of postponement and temporizing. ... He let matters drift as long as the letter of the law permitted him to. ... Why does he not suggest the necessary changes? Instead of making them on his own authority and responsibility he is proposing at the beginning of the tenth month of the [fiscal] year to set up a committee. The vice of this procedure lies in. its timidity and evasiveness. . . ."

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