Press Conference

THE PRESIDENT: I understand that in some mysterious and subterranean way you got the suggestion that Frank Murphy is going as Governor to the Philippines. I guess you are right.

Q. Frank Murphy of Detroit?

THE PRESIDENT: Yes, Mayor of Detroit.

Q. When will he go?

THE PRESIDENT: I don't think I have sent the nomination yet. It will go up Monday.

Q. Does that mean that Homer Cummings will stay as Attorney General?

THE PRESIDENT: Yes. And then somebody guessed that Chip Robert is going in as Assistant Secretary of the Treasury. That is right too.

I cannot tell you anything about diplomatic appointments because there are two or three on the way and we have not heard from the foreign countries as yet. . . .

Q. Have you been able to cash that first pay check?

THE PRESIDENT: Yes, I cashed it and I am sending back my 15 per-cent.

Q. What is that?

THE PRESIDENT: Dollars—$843.75. And I am also sending my dues to the National Press Club.

Q. That is foolish.

Q. That is on your first month's pay, is it?

THE PRESIDENT: Up to the first of April. . . .

Q. Would you like to make some comment on the effect on employment by reason of the production of beer?

THE PRESIDENT: Nothing. Maybe later on this evening, I may.

Q. I can right now. (Laughter)

Q. How many cases have you gotten thus far?

THE PRESIDENT: I can't say anything on the record. But all reports we are getting in is that the actual employment that has resulted from the manufacture of beer is bigger than the estimate; and the amount of beer manufactured during the month is running away ahead of the Treasury estimates.

Q. I want to thank you for sending the beer to the Press Club.

THE PRESIDENT: It got there all right? Fine.

Q. There have been reports of the Administration coming around again to inflation and I wonder if you will say something about that— I mean actual inflation of the currency.

THE PRESIDENT: No, not putting it that way. I will tell you, off the record, about the problem. After all, you ought to know it. It is an old story.

So much of the legislation we have had this spring is of a deflationary character, in the sense that it locks up money or prevents the flow of money, that we are faced with the problem of offsetting that in some way. I would not say "inflation of the currency," because that is not the necessary meaning.

You see, upon the closing of the banks we put away somewhere around four billion dollars. It was probably locked up before, but people did not know it. Now it is locked up, and people do know it. That is deflationary.

The effect of cutting very nearly a billion dollars off the Government payroll, including the veterans' cuts, cutting down of departments and cutting off 15 percent of employees' pay—it would probably run to perhaps not quite a billion dollars but very nearly that-means that much loss in the flow of money. That is deflationary.

Now, on the other side of the picture, we have C.C.C. (see Items 21, 31, 90 and 113 of this volume) giving employment to about 250,000 people in the forests and on works of various kinds. That is only $250,000,000 as an offset. Then there is $500,000,000 as an offset on direct relief to the States. (See Items 21, 55 and 75 of this volume.) That means we have not yet caught up with the deflation that we have already caused. Therefore, of course, we are going to talk about methods to give more people work or to raise commodity prices, which would . . .

Q. The Farm Bill would do it.

THE PRESIDENT: The Farm Bill would do it, of course, because it will raise commodity prices. The Farm Mortgage Bill and the Home Credit Bill (see Items 39 and 74 of this volume) will help because they will cut down the debt obligations of the small, individual family man—the home man. That is all to the good.

Q. Lower rentals . . .

THE PRESIDENT: But the question is whether all those things are really inflationary. They are helpful.

Q. Might we have an expression from you that there is no disposition on the part of the Administration to inflate the currency itself? I mean to print currency in a manner other than has been done.

THE PRESIDENT: What do you mean, start the printing presses?

Q. Yes.

THE PRESIDENT: Off the record, we are not going to start the printing presses. That is silly.

Q. Mr. President, are you ready to define what you consider a sound currency as expressed in your Inaugural Message? In your Inaugural Message you said you were going to stand for a sound currency.

THE PRESIDENT: I am not going to write a book on it.

Q. Can you say how much the public works program will overcome the five-billion-dollar deflation which you have mentioned?

THE PRESIDENT: That is very hard to tell. You can figure it twenty different ways. I don't know.

Q. Has any consideration been given to paying off deposits in closed banks or, rather, to facilitate the paying off of deposits?

THE PRESIDENT: Yes, we are talking about that now.

Q. Couldn't you allow us to discuss this on our own authority —what you have stated about inflation and deflation? You said it was off the record.

THE PRESIDENT: It has been printed lots and lots of times. There is nothing new in it. We know that a great' many of the measures have been deflationary; and we know too that a few of the measures have been somewhat inflationary in the sense of giving people work. But we know that we have not yet got to the point of equalizing; and that we probably must do more. I don't like the word "inflationary" because no two people agree on the definition of it. It is better to say that we have got to do something more to give people more work.

Q. May we use that as background?

THE PRESIDENT: I think so.

Q. That is, this last part?

Q. Your whole discussion or just what you said last?

THE PRESIDENT: No, just what I said last. I will hold it down to that. . . .