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No. 117 "New Work-Relief Funds: An analysis of a situation demanding that Congress call a halt on departures from constitutional government, review policies initiated by the Executive but properly within the province of the Legislative Branch and cut short both waste and extravagance in the expenditure of public funds," April 13, 1936.
No. 117 "New Work-Relief Funds: An analysis of a situation demanding that Congress call a halt on departures from constitutional government, review policies initiated by the Executive but properly within the province of the Legislative Branch and cut short both waste and extravagance in the expenditure of public funds," April 13, 1936. American Liberty League. 400dpi TIFF G4 page images Digital Library Services, University of Kentucky Libraries Lexington, Kentucky Am_Lib_Leag_117 These pages may freely searched and displayed. Permission must be received for subsequent distribution in print or electronically. No. 117 "New Work-Relief Funds: An analysis of a situation demanding that Congress call a halt on departures from constitutional government, review policies initiated by the Executive but properly within the province of the Legislative Branch and cut short both waste and extravagance in the expenditure of public funds," April 13, 1936. American Liberty League. American Liberty League. Washington, D.C. 1936. This electronic text file was created by Optical Character Recognition (OCR). No corrections have been made to the OCR-ed text and no editing has been done to the content of the original document. Encoding has been done through an automated process using the recommendations for Level 1 of the TEI in Libraries Guidelines. Digital page images are linked to the text file. JOIN THE AMERICAN LIBERTY LEAGUE The American Liberty League is organized to defend and uphold the Constitution of the United States and to gather and disseminate information that (1) will teach the necessity of respect for the rights of persons and property as fundamental to every successful form of government and (2) will teach the duty of government to encourage and protect individual and group initiative and enterprise, to foster the right to work, earn, save, and acquire property, and to preserve the ownership and lawful use of property when acquired. The League believes in the doctrine expressed by George Washington in his Farewell Address that while the people may amend the Constitution to meet conditions arising in a changing world, there must "be no change by usurpation; for this * * * is the customary weapon by which free governments are destroyed." Since the League is wholly dependent upon the contributions of its members for financial support it hopes that you will become a contributing member. However, if you cannot contribute it will welcome your support as a non-contributing member. ENROLLMENT BLANK Date........... I desire to be enrolled as a member of the American Liberty League. Signature ................................. Name ................................. Street .................................. Town ................................. County.......................... State. Enclosed find my contribution of $....... to help support the activities of the League. NEW WORK-RELIEF FUNDS â˜… â˜… â˜… An analysis of a situation demanding that Congress call a halt on departures from constitutional government, review policies initiated by the Executive but properly within the province of the Legislative Branch and cut short both waste and extrava-gance in the expenditure of public funds AMERICAN LIBERTY LEAGUE T^ational Headquarters NATIONAL PRESS BUILDING WASHINGTON, D. C. (117) Document No. 117 April, 1936 New Work'Relief Funds you have finished with this pamphlet, please pass it on to some friend or acquaintance who might he interested, calling his attention to the membership hlan\ on page 24. â˜… Fundamental issues are involved in the President's request for $1,500,000,000 to supplement $4,880,000,000 provided in the Emergency Relief Appropriation Act of 1935, the so-called Work-Relief Act. The extraordinary and unprecedented law of last year, authority under which continues until June 30, 1937, is a statutory basis for a subtle shift from the traditional American form of government to a mechanism with many similarities to European dictatorships. Under this law, a disintegration of the system of three coordinate branches, designed by the framers of the Constitution to prevent a recurrence of autocracy such as was responsible for the American Revolution, has been in progress. The Congress abdicated a large measure of its legislative authority in conferring blanket power upon the Executive. Under this law, the independent sovereignty of the states, intended in the Constitution to prevent undue centralization of authority in Washington, has been weakened. The Federal Government has assumed responsibility for matters within the sovereignty of the states, including relief, local improvements and social experimentation of various kinds. Under this law, liberties guaranteed by the Bill of Rights have become less secure. Executive authority has been increased not only by the largest sum of money ever placed at the disposal of a single official of any government but by the power to write laws, for violation of which the courts are under obligation to impose fines. Confronting the Congress is a duty to call a halt on departures from constitutional government, to review policies initiated by the Executive but properly within the province of the legislative branch and to cut short waste and extravagance in the expenditure of public funds. Phases of the situation which deserve attention are: 1. The present law vests far too much authority in the President and unless sharply restricted will apply in the use of supplemental funds. 2. Continuance of a miscellaneous assortment of emergency activities under the authority of Executive orders will be made possible by any expansion of funds subject to use under the broad powers of the Work-Relief Act. 3. References to the Supreme Court in the President's message asking additional money reflect a disregard for an essential element in the American form of government. 4. Approval of blanket authority in an additional appropriation would mean endorsement of policies which never have received real consideration by the Congress. 5. Evidence is constantly multiplying of the use of the work-relief organization for political purposes and the expenditure of funds for worthless projects of either a political or boondoggling ^ character. 6. Allotment of funds for the Florida Ship Canal, Passamaquoddy and other projects lacking approval of Government engineers has made ridiculous the claim that the interests of the taxpayers are best protected by placing complete power in the Executive. 7. The only available figures indicate that no progress has been made toward a real solution of the unemployment problem. 8. The President's attempt to shift responsibility for unemployment to private industry in the face of policies which are discouraging to business is an evasion of the real issue. 9. The work-relief program involves endless Treasury deficits, even though revenues are greater than ever before in peacetime. Power Under Present Law Nothing quite like the Work-Relief Act of April 8, 1935, was ever enacted before. Somewhere in its provisions can be found authority for almost anything for which a President may desire to spend money. The law appropriated for expenditure "in the discretion and under the direction of the President" a total of $4,880,000,000, of which $880,-000,000 represented transfers from unexpended balances of other funds. The general purpose of expenditures was stated to be "to provide relief, work relief and to increase employment by providing for useful projects." Types of projects specifically authorized included highways, roads, streets, grade crossing elimination, rural rehabilitation, relief in stricken agricultural areas, water conservation, trans-mountain water diversion, irrigation, reclamation, rural electrification, housing, work of the Civilian Conservation Corps, loans and grants for projects of states and local governments, sanitation, prevention of soil erosion, prevention of stream pollution, reforestation, forestation, 4 flood control, river and harbor improvement and "assistance for educational, professional and clerical persons." Also mentioned were "miscellaneous" projects, which apparently meant anything overlooked in the list of specific types. While the law contained an earmarking of funds for eight general classes of projects, authority was given to the President to change the amounts thus designated, which power has been taken advantage of to such an extent that the actual allotments bear little resemblance to the program as tentatively outlined. Among the special clauses was one authorizing the President to go into the banking business for the purpose of making loans to farmers for the purchase of lands and equipment. In carrying out the provisions of the law the President was authorized to appoint officers and employees, prescribe their duties, responsibilities and tenure and fix their compensation without regard to Civil Service and Classification laws, and to authorize miscellaneous expenditures such as for stenographic reporting services, supplies and equipment, purchase of books, periodicals, newspapers and press clippings, travel, rental of buildings, purchase, operation and maintenance of automobiles, printing and binding and "such other expenses as he may determine necessary to the accomplishment of the objectives of this Joint Resolution." Furthermore, the President was authorized "to establish and prescribe the duties and functions of necessary agencies within the Government." The President was authorized to acquire real property by the power of eminent domain and to improve, develop, grant, sell, lease, or otherwise dispose of it. The lawmaking power of the President was made complete by a clause authorizing him to make rules and regulations, violation of which is punishable by a fine of not to exceed $1,000. The President was authorized to fix wage rates not only on Federal projects but on state and local projects wholly or partly financed by Federal funds, such wages to be at levels conducive to the maintenance of what might be held to be prevailing rates of wages. The powers granted the President were so broad that while the law remains in effect he need not go to the Congress for specific authority for practically any of the types of expenditure for which in the past detailed legislation invariably has been necessary. Whether it be regarded as abdication of legis-5 lative power by the Congress or usurpation of such power by the Executive, the fact is that under the operation of the law the separation of powers contemplated in the Constitution has been made a dead letter. Appropriation of additional funds to be used under this law will imply approval by the Congress of the continued exercise of legislative powers by the Executive. Government by Executive Order The Work-Relief Act is broad enough to be the basis for Executive orders creating agencies and establishing activities with little, if any, relation to work relief. Scores of Executive orders of a sweeping nature have been issued under authority of the act. Executive orders recently issued under the Work-Relief Act to continue a part of the work of the defunct NRA illustrate strikingly how laws are being made and agencies created by a stroke of the pen at the White House. The sections of the National Industrial Recovery Act which survived the decision of the Supreme Court expired on April 1, 1936. Under the authority of that act about 1,800 NRA employees remained on the payroll as late as December 31, 1935. Their nominal duty for the seven months following the ending of codes had been to prepare reports on the accomplishments of the NRA. Effective January 1, 1936, the President abolished the NRA as a separate agency and transferred more than two-thirds of the employees to the Department of Commerce where they continued until April 1 to draw salaries under authority of an Executive order based on the National Industrial Recovery Act. The Consumers' Division of the NRA was transferred January 1 to the Department of Labor, being given an extra lease of life to June 30, 1937, under an Executive order based on the Work-Relief Act. Late in March the President saved the jobs of remaining NRA employees in the Department of Commerce, who otherwise would have gone off the payroll April 1, by establishing under the Work-Relief Act a new Committee of Industrial Analysis and a Division of Industrial Economics. The committee, composed chiefly of cabinet members, was given authority to create an unlimited non-Civil Service payroll in the new division, whose only function according to the Executive order is to "complete the summary of the results and accomplishments of the National Recovery Administration." Under the Executive order this branch of the Government service, lacking any specific authorization whatever by the Congress, can continue until June 30, 1937, its expenditures being limited only by the amount of the funds the President is disposed to allot. The President also issued an Executive order continuing Major George L. Berry as Coordinator for Industrial Cooperation. This office had previously been established by Executive order under authority of the National Industrial Recovery Act. The Coordinator, who serves without salary but with an expense account, was authorized to appoint employees and to prescribe their duties and responsibilities and fix their compensation without regard to Civil Service and Classification laws. A few days following the issuance of the Executive order extending the office of Coordinator for Industrial Cooperation, Major Berry announced that he proposed to devote much of his attention during coming months to a newly organized Labor's Non-Partisan League which has for its avowed purpose support of President Roosevelt for reelection. In the huge sum at his disposal and in his ability through Executive orders to exert an influence upon economic forces, the President's power can be compared to that of Mussolini without danger of exaggeration. Dictatorial power of the President is by no means so complete as that of Mussolini but the latter has no such amount of money at his disposal as provided by the Work-Relief Act. The Supreme Court The impression might be gained from the President's special message seeking additional funds for work relief that the Supreme Court had arrogated to itself authority which was superior to that of the basic law of the land. Difficulties encountered by the administration, it might be inferred from the President's references to the Supreme Court, have been due entirely to busybody interference by that tribunal rather than to violation of the Constitution. In connection with his appeal to industry to provide more employment the President asserted that "the public authority to require the shorter hours agreed upon has been seriously curtailed by limitations recently imposed by the Supreme Court upon Federal as well as state powers." The President had in mind the decision of the Supreme Court in the NRA case. He failed to 7 state that in this decision the Supreme Court unanimously held that the administration had exceeded its authority under the Constitution in its application of the National Industrial Recovery Act. The Court merely had reiterated its interpretation of the Constitution as given in numerous other cases over a long period of years. It had imposed no new limitations whatever upon the constitutional powers of the Government. Elsewhere in his message the President stated that the request for new funds to replace those from processing taxes was necessary because of the decision of the Supreme Court. He might properly have placed responsibility upon the Congress which upon his recommendation passed an unconstitutional law. The President's references to the Supreme Court cannot be regarded other than as an effort to arouse antagonism against the Court. They reflect a disregard for the separation of powers of the Federal Government into three coordinate branches which the framers of the Constitution believed would make the assumption of autocratic powers by any President impossible. Inadequate Consideration Appropriation of additional funds to be expended at the discretion of the President would imply a ratification of policies pursued by the administration under authority of the Work-Relief Act. Adequate consideration never has been given these policies by committees of the Congress. The administration was without a plan at the time of action on the Work-Relief Act in 1935 as made evident by the wide departures from the very general earmarking of funds in that law. In the 1935 act the Congress signed a blank check for $4,880,000,000. The excuse was that it was impossible then to chart the entire plan. Actual experience under the law now justifies and demands specific action by the Congress in approval or disapproval of items in a detailed program. When the President submitted his annual budget message in January he omitted any supplemental estimate for work relief, although he stated definitely that additional funds would be necessary and intimated that the amount might be around $2,000,000,000. He said then that "to make today a formal budget estimate of the amount necessary for work relief would be of necessity a difficult task." There was a well-founded suspicion that the reason for delay was to prevent an adequate investigation of how 8 funds have been spent thus far and how the additional money will be used. The supplemental budget estimate, submitted two and one-half months after the convening of the Congress, confirms the suspicion. In the supplemental budget message the President shed no further light whatever on the work-relief program. Not a shred of information was added to show just how much will be spent or for what purposes. The inference again was conveyed that additional funds to an amount of about $2,000,000,000 might be needed, but the President said he would ask for only $1,500,-000,000 on the theory that the balance of the slack in employment might be taken up through joint efforts of industrial groups. The President might just as well have submitted his request in January, which would have given more adequate time for a proper study of the entire situation. Politics in Relief By reason of a family quarrel among Democrats in West Virginia the public has been informed of the flagrant misuse of Government funds for political advantage in that state. Senator Rush Holt, Democrat and administration supporter, has charged that not only have administrative positions under the work-relief set-up in that state gone only to those with the O.K. of a political boss but even the relief beneficiaries have had to show political credentials. Salaries have been increased beyond reason for political favorites, while projects have been approved or rejected because of political considerations, according to Senator Holt. In Pennsylvania the Democratic organization has assessed job-holders under the work-relief program, threatening loss of jobs in the event of failure to contribute to campaign funds. Harry W. Fee, chairman of the Democratic Committee of Indiana County, Pennsylvania, in a letter December 4, 1935, to Mary C. Shearer, an emergency relief employee, said: "I am very much surprised that you have not responded to our previous letter requesting your contribution in the amount of $27.00, to Indiana County Democratic Campaign Committee, as I was sure that you appreciated your position to such an extent that you would make this contribution willingly and promptly. I must, however, now advise you that unless your contribution in the above amount is received promptly, it will be necessary to place your name on the list of those who will not be given consideration for any other appoint- 9 ment after the termination of the Emergency Relief work, which as you know, will terminate in the near future. "Please make your check payable to A. Lucile Baun, Treasurer, and mail the same to her at 402 Indiana Theatre Building, Indiana, Pennsylvania." Further evidence of the political character of the administration of work relief in Pennsylvania has been given by Gifford Pinchot, former Governor of that state, who in a letter of protest to the President quoted a district administrator as making the following statement at a meeting of WPA foremen and supervisors in Pittsburgh on December 11, 1935: "I'll tell you right now that any WPA worker who is not in sympathy with the WPA program and the Roosevelt administration will be eliminated from the WPA rolls in this district as quickly as I can act. I want you men to report all such cases to me without delay." Mr. Pinchot asserted that the WPA in Pennsylvania "is not only polluted with politics, but disgracefully inefficient." In the WPA in New York City "a growing tendency to disregard efficiency and economy for other considerations" caused Walter M. Langsdorf to resign as deputy administrator on February 11, 1936. Mr. Langsdorf, who according to The New York Times had been regarded as one of the best executives in the organization, objected to an evident purpose to use the WPA as "a Democratic vote-getting machine" and declined to be made a "political football." The situations in West Virginia, Pennsylvania and New York are not isolated instances of the injection of politics into the administration of work relief. The charges made in these states are typical of what is taking place throughout the country. Boondoggling The useless character of a considerable part of the work-relief program has been so obvious as to occasion nation-wide ridicule and protest. Such projects, most of them without even remote value to a local community, have been classed as "boondoggling." Through a $75,000 allotment for a radio project under the Office of Education of the Interior Department the listening public has been regaled with such queries as whether a croquette ever makes a good wife, how many feet has a full-grown Caucasian and where is the place to 10 buy a goober. The theory is that the recipients of work-relief payments who participate in the broadcasting find their own morale stimulated more than if they were paid a dole. The Washington Post was led to remark that in the use of Federal funds to pay the unemployed "to broadcast sheer idiocies, a new low in national degeneracy has been attained." As many as 700 different studies have been in progress, at a cost of more than $30,000,000, to gather information which no regular agency of Federal or state governments ever has thought it worthwhile to undertake. According to The New York Times one area in a middle western city was canvassed seven times by two different sets of investigators who asked the same questions before a higher-up put a stop to it. The WPA authorities claim credit for having eliminated from tentative questionnaires such questions as "Are you divorced? Why not?" and "To what do you attribute your old age?" About 5,000 persons have been at work in the preparation of a national guidebook of five or six volumes, the exact purpose of which when completed is a mystery. The guide to the City of Washington, a part of it, runs to about 250,000 words but no provision has been made for its publication. A vast amount of copy was produced for a guide to the City of New York but most of it was not usable. Samuel Duff McCoy, who was discharged as director of the Federal writers' project in New York City, charged that the reason was that he opposed communist elements who sought to obtain control. Local Projects Many work-relief projects undoubtedly have value to local communities. Among them are projects involving the repair of streets, the digging of sewers and the improvement of parks. While such projects may be justified from a local standpoint, there can be little excuse for the use of Federal money. Expenditures of this kind by the Federal Government tend to break down the division of responsibility between local and Federal Governments as denned in the Constitution. Citizens of smaller communities are naturally willing that the taxpayers of other sections of the United States shall bear the cost of their local improvements. Their tendency is to lose sight of relative values in asking improvements for which others will pay. There is no reason 11 from a national standpoint why taxpayers should help to finance local improvements in remote cities and states. Those who are paying the cost have nothing at all to say about the projects. Under such conditions an enormous waste of public funds is unavoidable. When political factors enter into the approval of projects, as has been true under the WPA, the taxpayers have little chance of getting their money's worth. Among local projects largely financed by WPA funds is a $19,000 dog pound in the City of Memphis. According to descriptions of the dog pound, luxuries to be provided for the boarders include "individual pens, with fresh bedding every day; exercise runways, shower baths and every imaginable comfort known." No one can object if the citizens of Memphis decide that it is desirable to spend money obtained through local taxation for a dog pound. If the Congress of the United States should by specific action decide that the dog pound of the City of Memphis serves the welfare of the nation, citizens of other cities might be content to accept the judgment of their duly elected representatives. When an allotment of funds is made by an executive officer of the Government for a purpose wholly outside proper Federal functions, the citizens of other cities have good reason to voice a protest. Unauthorised Projects One of the strongest arguments for delegation of authority to the executive branch of the Government in connection with the allotment of funds for public works was that by this method the logrolling and trading characteristic of public building and river and harbor measures in former years is avoided. The theory was that the executive departments are not influenced by political considerations to the same extent as members of the Congress and that it is thus made certain that public funds will be used only for projects approved by the Army engineers or other qualified experts. Experience has now shown that a "pork barrel" can exist under a system of executive allotments. Hundreds of millions of dollars have been allotted or obligated for public works and work-relief projects actually disapproved by the engineering authorities of the Government. The President not only has allotted funds to make possible a start on huge projects lacking the specific approval either of the Con-12 gress or of the engineering authorities but has committed the Government to their completion even though requiring large additional appropriations. The practice followed for some years prior to the present administration was for the Congress to make lump-sum appropriations for public buildings, river and harbor improvements and other public works, the executive branch of the Government being given authority to allot the money only to projects with the approval of the engineers and authorized specifically by the Congress. Under such a plan there is no undue delegation of authority, and logrolling in Congress is reduced to a minimum. The complete disregard by the present administration of the principles which have heretofore governed allotments for public works proves the desirability of a firmer check by the Congress on the spending departments of the Government. In its rejection of the Florida Ship Canal and the Passamaquoddy tide-harnessing project the Congress has shown a commendable disposition to reassert its rights and prerogatives. Both projects were commenced by allotment of emergency funds in the face of adverse engineering reports. In both cases the President sought to shift the responsibility for their completion to the Congress in connection with regular appropriations to the Army engineers. The House Appropriations Committee rejected the President's budget recommendation and the Senate twice defeated attempts to restore the projects as amendments to the appropriation bill. The Florida Ship Canal was formally disapproved by Public Works Administrator Harold L. Ickes on January 29,1935. At the insistence of the sponsors further consideration was given with a result that the legal division of the Public Works Administration reported adversely on February 2, 1935, and the finance division did likewise on April 11,1935. Despite these adverse reports and despite the absence of a favorable recommendation from the Army engineers, the President inaugurated the project by an Executive order issued September 3,1935. The President approved an initial allotment of $5,000,000 which was supplemented later by two allotments of $200,000 each. The Army engineers, who were assigned to construct the 200-mile canal, estimate that at least $138,000,000 additional will be required to complete it. In the light of a showing as to a lack of economic value the Congress properly declined to authorize the fulfill-13 ment of the commitment made by the President. Responsible heads of many large corporations as well as of shipping companies stated publicly that they would not use the Florida Ship Canal if constructed. Before the President allotted funds to the Passamaquoddy project in Maine, engineers of the Federal Power Commission and the Public Works Administration reported that the power to be generated could not compete in price with steam-generated power because of high operating costs, that there was no present or prospective market for the power at any price and that hydro-electric energy when needed in that area could be generated more cheaply on Maine's undeveloped rivers. In pursuance of political promises the President approved an initial allotment of $5,000,000 for "Quoddy." An additional allotment of $2,000,000 was made. The Army engineers estimate that about $38,000,000 more will be required to complete it. The Congress has refused to give its approval, although, as in the case of the Florida Ship Canal, work has been in progress for many months and if the President so chooses he can allot further work-relief funds. The administration succeeded in obtaining approval in the annual Interior Department appropriation bill of additional funds for 16 unauthorized western reclamation projects for which allotments had been made by the President. Included in the list were $20,000,000 for the Grand Coulee Dam in the State of Washington, for which $35,000,000 had already been allotted and for which large additional funds will be needed before it is completed. Also in the list were additional funds for the Casper-Alcova reclamation project in Wyoming and various other projects which were rejected on numerous occasions by the Congress because of their undesirability from an engineering and economic standpoint. The record of the administration with respect to allotments for projects of a permanent character thus inspires scarcely more confidence than its record in connection with projects which are of the made-work variety. No Solution of Unemployment According to the only available figures the administration has failed to accomplish anything toward a real solution of the problem of unemployment. Instead, by, policies both 14 with respect to direct relief and work relief, it has encouraged dependence upon the Government to such an extent as to weaken the moral stamina of a large element of the population. Proper discrimination between worthy cases and those without merit has been lacking with the result that thousands of persons capable of caring for themselves or with other possible means of support have become public charges. The impression has gone out that "easy" money is available and that anyone with the slightest cause to qualify would be foolish not to get his share. The situation in the District of Columbia illustrates what has taken place under excessively liberal policies. There is little depression in the City of Washington. The entire city revolves around the Government. More than 45,000 employees have been added to Government payrolls within the District of Columbia under this administration. This does not include thousands of workers given employment in the Government building program. By reason of the swollen payrolls space in office and apartment buildings is at a premium. Probably at no time in the history of the city has there been less excuse for governmental assistance to private relief agencies. Nevertheless recent statistics show that one out of every seventeen of the city's population is taking advantage either of direct relief or work relief. Meanwhile, many employers find it difficult to induce relief "clients" to accept jobs. The Government by attempting to mix reform with recovery has hampered a return to normal conditions. In spite of the expenditure of billions for public works and for work relief under plans which were designed to generate new employment, the number of unemployed totaled in February, 1936, 12,550,000, according to the estimates of the American Federation of Labor, and 9,848,000, according to the National Industrial Conference Board. These totals do not take account of those given employment on work-relief projects. A Political Gesture The President's arbitrary reduction by $500,-000,000 of the additional amount estimated to be necessary for work relief cannot be construed other than as an evasion of the real issue. The 15 reduction is predicated on a possibility that private industry through coordinated effort may provide sufficient new employment to make the extra half billion unnecessary. The implication is that if it later becomes necessary to ask for $500,000,000 more, the fault will rest with private industry. The President's suggestion seems to contemplate as much regimentation of industry through rigid regulations as to hours and wages as can be accomplished without going counter to the decision of the Supreme Court in the NRA case. The industrial program presumably would be on a voluntary basis but the objectives would be the same as under the NRA. The President apparently fails to recognize that the restrictions upon industry under the NRA retarded recovery. In attacks upon business by leading spokesmen for the administration the impression has been given that the manufacturing industries have shirked their duty in failing to provide full employment. The fact of the matter is that by the Government's own figures recent employment in manufacturing industries has been within about 2,000,000 of the peak of 1929. The census of manufactures by the Department of Commerce shows that 8,838,743 wage earners were employed in 1929 in industrial plants. Obviously with a record total of less than 9,000,000 wage earners on its payrolls, the manufacturing industry cannot be responsible for a very large part of the present estimated unemployment of from 9,800,000 to 12,500,000. Private industry will be most certain to do its part in providing employment if the administration will pursue policies which give encouragement instead of arousing fear. Work-Relief Expenditures Work relief has proved a costly method of caring for the unemployed. Allotments have been made for so many purposes other than work relief that only about $1,300,000,000 of the $4,880,000,000 fund has actually been available for the Works Progress Administration. Of the remaining amount allocated by the President about $527,000,000 has gone for Emergency Conservation Work; about $441,000,000 to the Public Works Administration; about $193,000,000 to the Resettlement Administration; about $10,000,000 to the Rural Electrification Administration; about $576,000,-16 000 to the Department of Agriculture, including highway construction; about $132,000,000 to the Department of the Interior, including $83,000,-000 for reclamation; about $149,000,000 to the War Department, including $133,000,000 for rivers and harbors and flood control; and about $141,000,000 to other regular departments and agencies. The amount used or allocated for direct relief from the fund has been about $939,000,000. About $4,407,000,000 from the $4,880,000,000 fund had been allocated by the President up to February 29, 1936. Only a little more than half of the amount allocated had been actually expended. The Works Progress Administration and Emergency Conservation Work, with an aggregate in allotments of $1,827,000,000, or 38 per cent of the $4,880,000,000, were furnishing 3,488,673 jobs on February 29, 1936, while all other agencies receiving allotments were accounting for only 354,401 jobs. The figures are those of Works Progress Administrator Harry L. Hopkins. Thirty-eight per cent of the money was bearing 92 per cent of the burden of furnishing employment. Enormous administrative costs are involved in the expenditure of the work-relief fund. Allocations for this purpose alone include $62,000,000 under the Works Progress Administration, $44,-700,000 under the Treasury Department, $25,-650,000 under the Resettlement Administration, $10,592,120 under the Department of Agriculture, $2,313,139 under the Interior Department, and $1,289,819 under the War Department, besides lesser amounts for various other agencies. The Works Progress Administration is using nearly 5 per cent of its funds for administrative costs, while Professor Rexford G. Tugwell's Resettlement Administration is using 13 per cent of its total funds for this purpose. Administrative employees of agencies financed from the work-relief fund totaled at the end of February, 1936, 142,850, including 17,427 in the District of Columbia and 125,423 outside, according to the monthly statement of the Civil Service Commission. Allocations to the Works Progress Administration, totaling $1,298,785,718, include, besides $62,600,000 for administrative expense, $1,109,-003,904 for grants to the states for work-relief projects, $99,813,036 for assistance for educational, professional and clerical persons, $15,000,-000 for forestation and prevention of soil erosion, 17 $10,868,778 for work-relief projects on Federal property and $1,500,000 for the National Youth Administration. The Resettlement Administration's allocations, totaling $192,819,354, include, besides $25,650,-000 for administrative expense, $131,000,000 for rural rehabilitation, $20,000,000 for prevention of soil erosion and stream pollution and $16,-169,354 for relief in stricken agricultural areas. Treasury Deficits Continued Treasury deficits are attributed by the administration chiefly to items classified in current budget statements under the heading of "Recovery and Relief," although as a matter of fact many expenditures which might properly be regarded as of a regular character are being financed from borrowed funds. The Recovery and Relief total in the fiscal year 1935, according to the present official classification, was $3,-068,803,053, while the deficit was a little more than $3,500,000,000. The Recovery and Relief total in the current fiscal year of 1936 is estimated in the annual budget at $2,869,068,187, while the deficit is estimated at $3,234,507,392. The Recovery and Relief total for the fiscal year 1937 is estimated in the budget at $1,102,824,632, without the supplemental work-relief fund, while the deficit is estimated at $1,098,388,720. If $1,500,000,000 is added for work relief, the Recovery and Relief total for 1937 will be at least $2,600,000,000. The deficit, including $1,000,-000,000 or more which must be raised to cash soldiers' bonus bonds, will be $3,500,000,000 or more and may easily exceed $4,000,000,000. It is assumed that new taxes will be levied to offset the loss of processing tax revenue. Revenues under existing tax laws are at a higher level than at any time since immediately after the World War. Receipts will be even higher as business improves. If Recovery and Relief expenditures were reduced from an average of $3,000,000,000 to $1,000,000,000, the budget would be in complete balance within a very short time. The same result could be obtained, without so great a cut in emergency items, by reducing the outlay for the regular departments. So long as present work-relief policies are continued, the end of the period of deficits is not in sight. The present appropriation will by no means be the last. More funds will be demanded as rapidly as the money appropriated is ex-18 hausted. If goods and services were being created as in private industry, the employment would perpetuate itself. Most projects for which Government funds are being spent are not productive and as fast as the money is used, the jobs are gone. Responsibility of the Congress No present reason exists for continuance of the broad authority of the Work-Relief Act. The administration has had a year in which to frame a definite program. Three years ago and even later the American neople, because of the acute emergency, were extremely tolerant of experiments. Has the emergency passed or not? If it has not, then the administration has failed despite its enormous expenditures. If it is over, as claimed by numerous administration spokesmen, then the emergency authority should be withdrawn. In presenting the work-relief plan in 1935 it was stated that all employables on relief would be put to work within a matter of months. Even this has not been accomplished. There remain a considerable number of persons receiving direct relief. Why has this feature of the program failed? Even after three years of experience with the relief problem the administration admits that its information as to exact conditions is inadequate. Why has no real census been taken of the unemployed? Without accurate knowledge of the situation an adequate basis for the determination of a policy is lacking. The responsibility of the Congress is clear. The Work-Relief Act should be revised in the light of constitutional principles. The normal balance between legislative and executive authority should be restored. The Congress should review what has taken place under the Work-Relief Act, passing both upon policies and actual expenditures. Henceforth, the Executive should be restricted to a program specifically authorized by _ the Congress. Appropriations should be limited to such amounts as are then needed. There should be no place in the program for useless boondoggling, political favoritism and social experimentation which is visionary as well as costly. The goal should be the restoration of the burden of relief to the states and local communities. Pending complete realization of this objective, the Federal Government should abolish work relief, contributing temporarily such 19 amounts as are necessary for direct relief and subsequently assisting through loans such states as are not able to care fully for their dependents. The policy of spending our way out of the depression at a cost of a steadily mounting debt should be abandoned. In place of it should be a policy embracing economy and thrift, attainment of a balanced budget and proper encouragement of private industry, including the elimination of fear-inspiring measures for alleged reform. PAMPHLETS AVAILABLE Â£OPIES of the following pamphlets and other League literature may be obtained upon application to the League's national headquarters. Statement of Principles and Purposes American Liberty League Its Platform Inflation The Holding Company Bill The Farmers' Home Bill The Supreme Court and the New Deal The President's Tax Program Expanding Bureaucracy Lawmaking by Executive Order New Deal Laws in Federal Courts Consumers and the AAA Dangerous Experimentation Economic Planning Mistaken But Not New Work Relief The AAA and Our Form of Government Alternatives to the American Form of Government A Program for Congress The 1937 Budget Professors and the New Deal Wealth and Income The Townsend Plan The Story of an Honest Man The New AAA The President's 1936 Tax Proposals The President Wants More Power (leaflet) The Townsend Nightmare (leaflet) A Farmer Speaks (leaflet) Will It Be Ave Caesar (leaflet) Our New Spoils System (leaflet) The National Labor Relations Act Summary of Conclusions from Report of the National Lawyers Committee Straws Which Tell An Open Letter to the President By Dr. Neil Carothers The Duty of the Church to the Social Order Speech by S. Wells Utley Two Amazing Years Speech by Nicholas Roosevelt Legislation By Coercion or Constitution Speech by Jouett Shouse PAMPHLETS AVAILABLE (continued) The Imperilment of Democracy Speech by Fitzgerald Hall The Spirit of Americanism Speech by William H. Ellis The Test of Citizenship Speech by Dean Carl W. Ackerman Today's Lessons for Tomorrow Speech by Captain William H. Stayton The Duty of the Lawyer in the Present Crisis Speech by James M. Beck The Constitution and the Supreme Court Speech by Borden Burr Inflation is Bad Business Speech by Dr. Neil Carothers Arousing Class Prejudices Speech by Jouett Shouse The Fallacies and Dangers of the Townsend Plan Speech by Dr. Walter E. Spahr What of 1936? Speech by James P.Warburg Americanism at the Crossroads Speech by R. E. Desvernine The Constitution and the New Deal Speech by James M. Carson The American Constitution Whose Heritage? Speech by Frederick H. Stinchfield The Redistribution of Power Speech by John W. Davis Time to Stop Speech by Dr. Neil Carothers The President Has Made the Issue Speech by Charles I. Dawson The Facts In the Case Speech by Alfred E. Smith The Townsend Utopia Speech by Dr. Ray Bert Westerfield Inflation and Our Gold Reserve Speech by Dr. E. W. Kemmerer The Constitution The Fortress of Liberty Speech by James A. Reed Entrenched Greed Speech by Dr. G. B. Cutten The Right of Petition Speech by Jouett Shouse Should We Amend the Constitution to Grant the National Government General Welfare Powers Speech by W. H. Rogers The New Inquisition Speech by Jouett Shouse It Can Be Done Speech by Merrill E. Otis The Voice of the Constitution Speech by Arthur H. Vandenberg