The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1895-12-16
OUR BAD CURE CY
Secretary Carlisle's Report
Clearly Shows Where Our
Financial Weak
ness Is.
THE ENDLESS CHAIN DOES IT
Deficit in Revenues Steadily
Decreasing, but the Gold
Drain Keeps On.
STOP THE BANKING BUSINESS
Remedy to Be Found in a Bond
Issue and Withdrawal of
Treasury Notes.

WASHINGTON. Dec. 16. Or an
nual report of Hon. John c. Carlisle,
Secretary of the Treasury, was sent 10
Congress today. 1t was. of course. a long
and important document, but that portion
of it which referred to national finances
was as follows
"At the beginning of the last nscai
year. July 1, 1894. the cash balance in
the Treasury. excluding all current lia-
bilities. but including a gold reserve OF
S64, S7S. 024.O6. was $l17. 1884, 96.lS. and at 'he
close of the year. June 30. 1895. the cash
balance. excluding all current Ilapiilues'
but including a gold reserve OF SloooV'VVo,
was S195, 240, 1887. showing an increase u
1856, n7.74. The excess of expenditure
over receipts during the year was s4z'-
$685. 23. IS, as against a deficiency OF Sos.-
sos, 26o.5S during the fiscal year OF 1851
The total receipts during the fiscal year
1896 were $3.50 055.S5 greater than the
receipts during the fiscal year 1871 ana
the expenditures were SIl329.9Sl.of less
than during the year 1894. h revenue
derived from customs during the tscai
wear 1895 exceeded the revenue derived
from the same source in 1884. by Inc
sum of $40. $40, 0S6.SS but the receipts under
the internal revenue laws, n from
some other sources, were less than dur
ing the previous year. so that the net
increase of revenue was SIS, 66S. O55.36 as
above stated.
sIf the income tax provision contained
in the Act of August %, 1894, had peen
sustained by the courts, it is believed that
the deficiency for the year would NOT
have exceeded the amount LII
my last annual report. But the decision
of the Supreme Court, holding the IN
come tax provisions of the Act TO De
unconstitutional. and the fact thai the
receipts from Internal Revenue did not
increase as anticipated but actually Ieli
off s., $50, 500 10 during the fiscal year
1853. Is compared with the previous year.
Notwithstanding the higher rate imposed
on spirits and other articles. have greatly
altered the situation. and I am now ofsthe
opinion that there will be a deficiency OF
about 81, 600. 900 during the current hscai
year"
Discussing the endless chain" theory
Of the deficiency the Secretary says
The total excess of expenditures over
receipts from July /. 1899. to December l.
1885. was $780, 21 ,023: and of this sum
Z,15Z,ZSUS WAS pau Jul VI
on hand at this date in excess OF sluV,-
0G0.OOO, and the remainder has been SUD
piled by the use of United states noles
and Treasury, notes presented ;n aoT he
Treasury in exchange for gold cqlnt
The Act o May 81, 1878, provided thal
when any United s Stated 9oee sn maS the
treasury under any law. from
source whatever. and shall belong to the
United States. they snail not o. sbai;
he re-issued and paid out AGAIN dno
kept in circulation -,
IF is clear that when any of these
notes have been redeemed they do nor
constitute a part of the reserve, iunC.
but become a part of h general caSn
assets of the Treasury, to be used ~
the same manner as other money be-
longing to the Government WheneVes
they could, by exchanges; be useo ~ ~
the reserve, they have been SO appiiea.
but, when this could not be done, they
have been treated as available Iunqs ~
Of public expenses. None OF my prede-
cessors in office have ever mace any
distinction n5Sment p af wee or rds no'e revenue and
notes presented by the holder ana re,
deemed in coin. but such notes nav
been used indiscriminatelv as the es-
Fences Of ne public service required"
Discussing the prospect of revenue anf
expenditures coming together IN the lu'
ture the Secretary says
ssThe cash balance in the treasury on
the first day of December, 1895, was
SIT .406. 1856, being $98, or, APO in excess OF
the actua gold reserve on that day, ana
sri. 4O6 1856 in excess IF any sum that n
would be necessary to use for replenisn'
ing that fund in case the Secretary
should at any time be able to exchangt
currency for gold. There Is. therefore
no reason to doubt the ability OF tns
government to discharge all its currenl
obligations during the present fiscal year
and have a large cash balance at It's
close. without imposing additional tax
alton in any form upon the people,; pu'
/ adhere to the opinion heretofore ex
pressed, that the Secretary of the Treas
lry ought always to have authority tt
issue and sell, or use in the payment o.
expenses, short time bonds, bearing {
low rate of interest, to supply casua
deficiencies in the revenue.
.sWhile the situation does not require
any legislation for raising additiona
revenue by taxation at his time, 1T il
such as to require the strictest econom.
in appropriations and public expenses
Nearly every appropriation Is in terms
or by necessary implication, a direction
to the Executive authorities to expent
the money. and therefore the responsl
bility for an increase or reduction OF ex
penses rests primarily and mainly upof
Congress.
with a complete return to the norma
business conditions of the country, ant
a proper legislative and executive super
vision over expenditures, thesrevenue law
now in force will, in my opinion, ylelt
go