Indianapolis Times, Indianapolis, Marion County, 16 March 1939 — Page 5

Commands in Army ‘And Navy Shuffled; Craig to Be Retired

Jackson Hopes for High Court Decision Supporting Tax on Public Pay.

WASHINGTON, March 16 (U.P).

The Navy Department announced 13 admiralty changes today—the first of a series of shifts which will send new men into the top jobs of the Army and Navy. The Navy changes, effective sometime in June, will come in the midst of a huge rearmament program. The Navy's announcement included the appointment of Rear Admiral Harold R. Stark to be Chief of Naval ‘Operations, succeeding Admiral William D. Leahy, who will recire. Admiral + Leahy’s retirement at the age of 64 as commanding of- - ficer of sea forces is expected to be followed by that of Gen. Malin Craig, Chief of Staff of the Army —thus placing new men in the ranking positions of both services. Admiral Leahy has been Chief of Naval Operations since January, 1937. He becomes eligible for re-| tirement May 6. ‘Congress, meanwhile, was expected to send to the White House for signature soon President Roosevelt’s $358,000,000 emergency national defense program. Final enactment of the measure, which will authorize expansion of Army air strength to 6000 planes and strengthen Panama Canal fortifications, was expected today. Conference agreement was reached yes-

terday. : Other transfers include the. re-

placement of Admiral Harry E. Yarnell, commander-in-chief of the Asiatic Fleet, by Rear Admiral Thomas Charles Hart, new chairman of the Navy's General Board. Admiral Yarnell must retire Oct. 10, when he becomes 64 years old. Rear Admiral Arthur B. Cook, chief of the Bureau of Aeronautics, will be transferred to the command of the Aircraft Scouting Force, replacing Rear Admiral Charles Adams Blakely.

Court May Beat Congress

To Tax ‘Punch’

By LEE G. MILLER Times Special Writer WASHINGTON, March 16.—Congress, by delaying action to abolish the tax exemption of officeholders, may let the Supreme Court take the

ball away from it. The Administration bill to strip from Congressmen, State legislators and all other public employees their partial income tax immunity has been blocked temporarily in the Senate Finance Committee because of the introduction of several unrelated amendments. Senate action on the bill is therefore unlikely for a week or two at least. The House has already passed it, 269-103. But meanwhile

the Supreme

Court, in two cases now awaiting]

decision, has been asked by Solicitor General Robert H. Jackson to issue a sweeping decision overturning its own venerable precedents and to proclaim the constitutionality of Federal taxation of State officeholders and vice versa.

Black Takes Lead

A majority of the Court may insist on deciding the two cases on narrower grounds. But it is believed that one or more justices, and possibly a majority, will favor a broad declaration. ‘ Last May, in the Gebhardt case, five members of the Court held that officials of the Port of New York. Authority were subject to Federal income tax on their salaries. One of these five, Associate Justice Hugo L. Black, suggested that the Court should have gone further and settled the whole confused question of salary exemptions by repudiating its own decision of 1870 in “Collector vs. Day.” But in the Gebhardt case the Solicitor General had pitched his argument on narrow grounds, expressly disclaiming any challenge of the general theory of immunity. In the current cases (involving state attempts to tax the pay of HOLC and RFC officials), the Solicitor General took his cue from Mr. Justice Black and urged the Court to go the whole hog by striking down “Collector vs. Day.”

Senate to Debate

* Reorganization Today

WASHINGTON, March 16 (U..P.). —The Senate begins debate today on the Government Reorganization Bill passed by the House last week. Administration leaders hoped to obtain quick action in it in contrast to the 28 days of debate on last year’s bill. The measure, giving President Roosevelt limited authority to jreshuffle unexempted agencies of ithe Government, will be placed before the Senate by Chairman Byrnes: (D. S. C.) of the Special Reorganization Committee. iN Most objections to the bill have been removed, and Majority Leader Barkley (D. Ky.) predicted its passage before the end of the week. Chief controversy exists over the method of sanctioning the President’s reorganization orders. As written, the bill provides that they shall become effective 60 days after submission to Congress, unless both houses pass resolutions during that period “vetoing” them.

2 Cities Studied for Food Subsidy Experiment

WASHINGTON, March 16 (U, P.). —The Federal Surplus Commodities Corp. sent investigators into about 25 cities of 50,000 to 300,000 population today to select six for trial of the new food subsididy program. Milo Perkins, president of the FSCC, said six “representative cities” in widely scattered sections of the country would be selected on the basis of the investigators’ re-

ports, : COLD ON MOHAWK TRAIL

NORTH ADAMS, Mass. March 16 (U. P.).—It’'s no fun to have your truck stall on the Mohawk Trail— at 15 below zero. William Sargent of Leominster was treated for frozen feet, ears and hands suffered when

NATIONAL AFFAIRS ARMY and Navy high commands are shuffled. SUPREME COURT ma; settie question of tax on public pay. BUSINESS tax aid waits analysis of March returns. FSCC studies 25 cities in food : . subsidy experiment. SENATE to debate new ganization bill, ‘VANDENBERGH proposes to defer WPA emergency.

TAX RECEIPTS SHOW DECLINE

reor-

Business Waits Analysis Of March Returns.

WASHINGTON, March 16 (U.P.). —As the tax revision progrim took form today, latest Treasury statistics indicated that the drop in income tax collections this month might not be as severe as was anticipated. This was significant in view of the statement of conferees on the new business-aid tax program that no definite plan will be submitted until after the March 15 income tax returns are analyzed. In the first 14 days this month income tax collection totaled $96,636, 397, a drop of 26 per cent as compared with the receipts in the same days last year. If this same rate of

million dollars. On fhe basis of budget estimates, it had been cal

total only 425 million dollars as compared with 723 million dollers in March, 1938.

‘Progress Has Been Mad-’

Treasury Secretary Morgenthau said at a press conference that progress has been made in the White House tax conferences, but that the Treasury probably will not

gress until April. He will leave on March 24 for a two-weeks vacation at Sea Island, Ga. He said he doubted that the House Ways and Means Comiaiitee would be ready to consider taxes before that date. Another factor ‘which might delay consideration of tle tax bill, he indicated, was the illness of Rep. Robert L. Doughton (D. N. C.), chairman. The international crisis and its possible effect on American business entered the tax picture. Although the question has not yet entered White House tax discussions, Administration fiscal officials said continued tension in Europe might cause a resurvey of the tax program.

Exchange Heads Rebuked

Substitution of a single corporation tax for the various existent corporate levies still remains dominent in White House discussions. Administration leaders have agreed to avoid any increases in little business’ tax load if Congress revises revenue laws to eliminate the provisions opposed by large corporations, Chairman Harrison of the Senate Finance Committee | said after yesterday's - conference ‘with President Roosevelt. Meanwhile, representatives of 16 Stock Exchange executives, who spent two days drafting proposed changes in the Securities and Exchange Act, were rebuffed by SEC Chairman William O. Douglas.. He said the executives’ proposals for changes were “phony” and that he would fight them because “I don't want the boys in the Street (V/all Street) to have another party.”

NEW EVIDENCE DUE IN FLOYD SHORTAGE

NEW ALBANY, March 16 (U. P.). —Evidence to obtain new indistments against Joshua Crandall, New Albany, and Claude M. Gladden, Scottsburg, in connection with a shortage of $128417 in the Floyd County treasury, will be presented to the Grand Jury Monday bY Prosecutor Frank E. Lorch Jr. Indictments voted by the October Grand Jury charging the pair with accessory after the fact of embezz ement, were quashed by Judge Join M. Paris on grounds that they «id not state the offense with certainty.

Definite Plan to Relieve

present detailed proposals to Con-:

LU. Beauty

Here are some of the 150 Indiana University coeds

bevy Is T

who entered the annual beauty contest sponsored by The Arbutus, campus yearbook. After first eliminations were held last wight as the beauties paraded a Bloomington theater stage, only 25 contestants were left today. The 25 will compete in a similar parade next week and the five selected as queens will be pictured in the yearbook.

i

Orderly Processes of New Deal Bogged As Intraparty Differences Multiply

By THOMAS L, STOKES Times Special Writer

WASHINGTON, March 16.—The New Deal is bogged down and in

a state of confusion.

This is no secret. It is obvious to the man in the street who reads of the split within the Democratic Party, of the fights between Presi-

: dent Roosevelt and Congress, of the decrease prevails throughout the month, collections will exceed 500 |

backing and filling about doing something for business, which has been symbolized—to the discomfiture

of New Dealers, because of its Euculated that March returns would |

ropean implications—in the words “business appeasement.” : But just what all the shouting is about is perhaps not so obvious. Fundamentally it involves issues both political and economic. These dovetail.

First, ds to the split within the Democratic Party between what are termed, for want of better labels, “conservatives” and “New Dealers.” This is nothing new; it is only emphasized -at this time due to conditions. It has existed for years, with now one wing dominant, now the other, now both getting along together in a patchwork compromise. This is not the first time the President has been at odds with the conservative wing. The party was split up and down the middle after the Utility Holding Company Act of 1935. After much battering. the President won that fight and then went on to his sweeping victcty at the polls in 1936. The party was split wide open aver the President’s Supreme Court Reform Bill. Though numerous predictions were made at that tune that Mr. Roosevelt had lost conirol, he soon pushed through Congress another controversial measure, the Wage-Hour Act which was particularly obnoxious to many Southerners. A New Deal victory in the

Florida primary had frightened re-

bellious Democrats. The President thus has weath-red previous party. splits. Hence any hard-and-fast forecast of the future now is unwise. 1t is true, however, that the party sC¢hism seems more pronounced today than before, and that the ccnservatives have already achieved victory in one major skirmish this year, the fight over the relief bill earlier in the session— a fight which the President has now renewed.

Developments have intensified the split. : Bitterness ‘engendered among some Democrats by the President's Court plan was aggravated by the attempted primary “purge” of conservatives, which was part of Mr. Roosevelt's continuous campaign to liberalize his party. The antagonism of some Southern Democrats was aroused when the President threw his influence behind Senator Barkley (D. Ky.) for floor leader against a veteran Southerner with many friends and mich weight in party councils, Senator Harrison (D, Miss). The Virginia Senators, Byrd and Glass, who were already consistent foes of the New Deal were personally embittered when the President did not follow their recommendations on the apnointment of a Federal judge. ‘All these things have widened the schism. Hevolt, however, might not have

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broken into the open had it not been for the last election. Republican gains emboldened the conservatives, who interpreted the

returns as indicating public disfavor for New Deal policies, particularly those concerning spending and labor. Also it brought additions to Republican ranks, particularly in the House. Conservative Democrats decided to attempt to buck the New Deal along some fronts. The result, in practice though not in announced intent, was a coalition.

For the first time, the conservatives have practical -machinery. They are using it. Thus the conflict. From the election results, they have concluded that the party should now cease reform and begin to modify certain New Deal measures and policies, particularly

touching on spending, taxation and.

labor. They would turn the party into more conservative channels leading toward 1940. This course is disputed as unwise by the New Dealers. Their views have been voiced by Solicitor General Robert H. Jackson, whose thesis is that the party can survive as a majority party only if it continues liberal, that if the country is turning conservative it will not choose conservative Democrats to rule it, but Republicans. : The conservatives in Congress have support within the Administration. Treasury Secretary Morgenthau and Treasury Undersecretary John W. Hanes have given their support to the program of tax revision and economy. Out of numerous negotiations grew what has

come to be called the “business appeasement’’ program. Within the Administration, ‘the conflict is between the Morgenthau schoal and that headed by Federal Reserve Board Chairman Marriner Eccles, President Roosevelt and his

right, bower, Commerce Secretary f Hopkins, indicated their approval}

of some sort.of business encouragement—at least to the extent of closing the door now to further reforms —but| it has become clear that the President iz not willing to go very far with the conservatives.

He seems to cling to the Eccles |

spending theory. Though his tax views are riot yet entirely clear, he has indicated rather plainly fhat he

will stand firm against any easing|} of the burden on the big fellows at|f’

the expense of small business. The conilicting stories “business appeasement” are due to confusion witich still exists over how far Mr. Roosevelt will go. He has

not committed himself definitely on

any point. Since it can be forecast that he will 11ot satisfy the conservatives, g continued fight may be expected throughout this nation. The conservatives will try to fight the ball. He will resist that.

GUNSHOT WOUND FATAL Princeton, Steve Pugh, 65, died in a hospital

here today of a self-inflicted gunshot wound. He is survived by his widow. and several children.

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March 16 (U. P.).~—

RELIEF EMERGENCY

today introduced a bill which would defer need for &dditional relief funds until June 1, The bill provided that funds appropriated in the $725,000,000 de-|f ficiency relief measure earlier this session be used until June 1, 1939, instead of July 1, 1939, as provided in the bill. “This gives the President and

Works Progress Administration the funds they have requested up to June 1 and entirely eliminates the immediate crisis,” Senator Vandenberg said. He recalled that President Roosevelt had urged immediate con-. gressional action on his request for

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