Statement on the Economy Bill.

THE PRESIDENT said:

"I am in hopes that the conferees and the Congress will find it possible to accept the so-called furlough plan for dealing with Federal employees. It is in reality the 5-day week applied to the Government. It will produce a larger saving in expenditures in Federal employment than any other plan which is likely to pass Congress. The objection that it permits of discrimination has been met by the proposal that the few employees receiving over $1,200 a year to whom it might not be applied shall take an 8 1/3 percent reduction in pay, thus giving the equivalent reduction in Government expenses. It avoids discharges and enables some increases in the number of people employed by the Government through the necessity of some substitutions. In the large sense it maintains the standards of pay in the Government. It must be borne in mind that Government pay has never been on such high standards as that of private enterprise.

"It has a wider spread of importance than these immediate questions. It shows a willingness of the Government itself to cooperate with the country in a movement for shortening the hours of labor with view to increasing the number of people employed. It is an adoption by the Government of what has been done to a large extent in private employment.

"As I have said, the furlough plan is the application of the staggering system, the 5-day week or equivalent symbol for indicating the shortening of hours of labor for the purpose of giving some employment to a maximum number of people.

"I am also in hopes that the emergency powers to the President proposed by the Senate Economy Committee for immediate reorganization of Government departments with view to immediate reduction of expenditures will be restored by the conference. It is one of the most important avenues for economy in government that has been proposed. The general principle of reorganization has been accepted by both Houses, but under the provisions of the bill as it was sent to conference the powers to take emergency action were greatly curtailed in one House or the other. Under the terms of the bill as it left the Senate no reorganization of any great consequence could be made effective until next March. The economies are needed now more than a year hence. The emergency powers left in the bill by the Senate reduced the bureaus and commissions which can be immediately dealt with to those pending only $25 million a year and eliminated bureaus spending $500 million to $600 million."