Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1901-09-30
TIE SURPLUS PROBLEM.
One of Roosevelt's First Diff
culties Will Be to Deal
With Surplus.
Cut In the War Revenue Tax
Not Suificient-.Brewers
Want Reduction.
Others Want to Spend the Cash
For Great Public I'm.
provements.

Il
the United States. The dangers arts
inf from large surplus, according to
treasury experts, are two fold-first,
the fact that every dollar drawn into
the treasury is taken out of circulation,
and. secondly, the fact that the mere
existence of a large sum OF money lying
idle in the treasury serves as an incen-
tive to members of congress to vote for
laws providing for the widest kind of
Extravaganza.
Under the present national bank sys-
TEN government bonds have become an
actual necessity, because on them is
based exclusively the circulation issued
by the national banks. A large per-
centage of the outstanding bonds OF the
government run for a long term of
years.
The refunding operations carried on
after the Spanish war have retired the
greater portion OF the short time bonds,
SO that of the loan of 1904, which is re-
deemable after February OF that year,
there is now outstanding only little
over $40, 100000. Holders of bonds will
not sell them back to the government
at u penny less than their value as long
time securities.
AS it is impossible to buy bonds
therefore the problem which President
Roosevelt is called upon to solve in
wolves either radical reduction in the
rate of taxation or corresponding in
crease in the annual expenditures. or,
finally. some system by which the gov
eminent surplus may be kept In active
circulation among the people to whom
| 1t belongs.
The surplus of the first three months
of the fiscal year will be about $4,000
900 in round numbers. AT the same
rate the surplus for the whole year
would be about s64,000.0 900. This would
be a reduction in the surplus of only
s11,000,00O. as compared with last year.
When the war revenue reduction act
was passed last winter 1t was estimated
that the reduction in the government
receipts would amount to fully 100000
900. AS matter of fact, the internal
revenue for the first quarter of last
year exceed those of the first. three
months of the fiscal year by less than
$1,000, 900, including reduction for the
whole year of not to exceed $20.000.000.
The president naturally will have to
call attention to the fact that the re-
ceipts of the government continue to
lexceed the expenditures in a larger por-
ton than is advisable. Not a dollar
which is once paid into the treasury of
the United States can be paid out again
by any one except for regular expenses
of the government under specific ap-
preparations made by congress.
The secretary of the treasury has
authority to deposit internal revenue
receipts in banks, provided he does SO
before these receipts reach the sub-
treasures. Thistis the only way he can
prevent the surplus acting as a drain
upon the money of the country.
The loaning of government money to
certain banks, without interest, has al
ways been subject Of serious criti
cism, and 1t is believed congress may
take some steps during the coming ses-
sion to modify the existing law so that
some other avenues may be provided
for the use Of the surplus funds Of the
government.
There will be two elements at the
next session attacking the surplus from
different points of view. The brewers
lobby already has announced its in.
tention Of securing further reduction
of the tax on beer. The brewers insist
upon getting the tax down where 1t
was before the war, which would be 81
per barrel. On the other hand. the
friends of various schemes involving
large expenditures will oppose any re-
duction in taxation because 1t might
linjure the chances of their pet projects
In this way the friends of the Near
aqua canal, of the ship subsidy scheme,
OF whole nest of public building pro-
jects, and OF the diversified river and
harbor bill are all likely to get together
for the express purpose of Of preserv-
ing the surplus and opposing the reduc-
ton of taxation. They propose to let
the receipts stand as they are and to
Ireduce the surplus by the expeditions
methods of getting rid of the money in
the quickest possible time.
The advocates of these different
schemes have a strong argument at
their disposal because they are able to
show that in the case OF a government
which is spending over half a billion
dollars year an annual surplus of
about s6o,0oO,oOO is no more than COM
mon prudence would indicate.
At the same time 1t is & serious thing
that the available cash balance of the
treasury today. eliminating all trust
funds entirely, amounts to the enor-
nous sum of S190,632,2S3. Much more
than half of this is kept in circulation
because the balance in the depository
national banks now amounts to the I'M
usually large sum of $101.025,90
| Members of the senate and house
who have called here since President
Roosevelt came to the white house,
seem to unite In the belief that the reg
ulation of the financial policy of the
government will be the first important
question to be decided by congress.
The Public Building and River and
Harbor Committees have already form
ed definite alliance and between them
they could eat UP 100000 of the ex-
listing cash balance and leave little In
the treasury for the ship subsidy and
the Nicaragua canal, both of which
projects are to be represented ION the
hill next winter.
Halt Rates to Minneapolis, MINI,
4 Via the Northwestern line. Tickets will
be sold at one fare for the round trip on
Oct. 9, 10, ~ and IA. limited to return (by
extensIon) until Oct. 81, inclusive. APP
4 ply TO agents Of the Chicago & Norths
western railway.