The record-union., 1895-12-17

the Deficiency, While Internal Rev
snues Were Not Up to Expectations.
WASHINGTON, Dec. 16.-The annual
report of Hon. John G. Carlisle, Secre-
tary of the Treasury, was sent to Con
gress to-day. 1t was, of course, Ions
and important document, but that por-
ton of it which referred to Natlonal
finances was as follows:
''At the beginning of the last hscal
year, July 1, 1894, the cash balance in
the treasury, excluding all current Ia
bilities, but including a gold reserve OF
$64, S73, 024 06, was Sill, 5S4, 436 10, ana
at the close of the year, June ~, 1880
the cash balance, excluding all current
liabilities, but including a gold reserve
OF 100000 600, was $195, 240, 1o3 81
showing an increase of $77, 6o1,1lI a.
1.-The excess of expenditures over re-
ceipts during the year was S4Z,ooo'-
223 Is, as against a deficiency OF 9o9'-
800, 260 90 during the fiscal year 1871
The total receipts during the fiscal year
1895 We're So, 66S,O35 So greater than
the receipts during the fiscal year 1871
and the expenditures were Sl1,oz5'-
9S1 "a less than during the year 1871.
1.-The revenue derived from customs
during the fiscal year 1895 exceeded the
revenue derived from the same source
in 1894 by the sum of So, 34O,OSo %, Dut
the receipts under the internal revenue
laws and from some other sources were
less than during the previous year, Sc
that the net increase of revenue was
1868 O55 Sc as above stated.
IF the income tax provision contained
In the Act of August Is, 1894, had been
sustained by the courts, 1t Is peIeVeu
that the deficiency for the year WouIu
not have exceeded the amount estimated
in nv last annual report. In that re-
port the opinion was expressed that the
laws then in force would not only ylelu
an ample revenue during the fiscal year
1896. but that there would be a surplus
of nearly S29 600, 600. This opinion was
based upon the supposition, when tnen
seemed to be well founded, that an the
sources of revenue provided IN the AcI
of August Is, 1894, would be aYallaple,
and that. owing to the higher rate OF
taxation imposed upon distilled spirits
and some other articles, the receipts un-
der the internal revenue laws WouIo De
very considerably increased; but the oe-
cision of the Supreme Court holding the
income tax provision of the ACT TO pe
unconstitutional, and the fact tnat the
receipts from internal revenue ala not
increase. as anticipated but actually
fell off So 6S9, $50 10 during the nscal
wear 1895. as compared with the pre-
vious year, Notwithstanding the hlgher
rate imposed on spirits and other arL-
cIes. have greatly altered the SITUATION,
and I am now of the opinion that there
will be a deficiency Of about ST. oV'V0o
during the current fiscal year
F1,.. f1r7d1 cCC p
of the deficiency, the Secretary says:
'sThe total excess of expenditures over
receipts from July /, 1893. to December
| 1895. was $50, 221, 023, and of this
sllm 500. 49,, 800 IS was paid out OF the
balance on hand at this date in excess
Of 500, 100000, and the remainder mas
been supplied by the use OF United
States notes and treasury notes pre-
sented for redemption and thus re-
ceived into the treasury in exchange
for gold coin. The Act of May 81, 1913,
provided that when any United States
note may be redeemed or be received
into the treasury under any law from
any source whatever, and shall belong
to the United States, they shall not be
retired, cancelled or destroyed, but they
shall be reissued and paid out again
and kept in circulation.
''It is clear that when any OF these
notes have been redeemed they do not
constitute a part of the general reserve
fund, but become a part of the general
cash assets of the treasury, to be used
in the same manner as other money
belonging to the Government. When
ever they could, by exchanges, be used
to procure gold for the replenishment
of the reserve, they have been so APP
piled. but when this could not be done
they have been treated as available
funds in the treasury, and reissued In
payment of public expenses. None OF
nv predecessors in office have ever
made any distinction between the notes
received in payment of the ordinary
revenue notes presented by the holders
and redeemed in coin, but such notes
have been used indiscriminately as the
exigencies of the public service re-
CURED
Secretary Carlisle quotes in support
o, this proposition the report of Secre-
tary Sherman for 1877, which led to
the law of Congress, enacted May 81
1878, making it mandatory upon the
Secretary of the Treasury to reissue the
rotes.
Referring to the prospect of revenue
and expenditures coming together in
the future, the Secretary says: The
cash balance in the treasury on the LIST
day of December. 1895, was SIT, 406,-
$50. being S9S or, 420 in excess of the
actual gold reserve on that day, and
ST., 406,3S in excess of any sum that
Il would be necessary to use for replen-
fishing that fund, in case the Secretary
should at any time be able to exchange
currency for gold. There is, therefore
no reason to doubt the ability of the
Government to discharge all its cur
rent obligations during the present ifs
cal year, and have large cash balance
at its close, without imposing add
tional taxation in any form upon the
people, but / adhere to the opinion
heretofore expressed that the Secretary
OF the Treasury ought always TO have
authority to issue and sell or use in
the payment of expenses, short-timt
bonds, bearing low rate of interest
to supply casual deficiencies in the rev
enue.
while the situation does not requir'
any legislation for raising additiona
revenue by taxation at this time. it Il
such as to require the strictest economy
in appropriations and public expendi
lures. Nearly every appropriation is II
terms, or by necessary implication, di