The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1909-12-08
CUT in EXPENSES.
Economy Is the Keynote of Sec
rotary MacVeagh's Report.
Plans for the Deficit to Disap-
pear in 1911.
CANAL BOND ISSUE.
Reimburse the General Fund for
Money Spent.
May Necessary to Put Out Certif-
icates OfDebt.

4
year 1911, embodied in the annual re-
port of Franklin MacVeagh as Secre-
tary of the Treasury, made public to-
| day. This is in line with President
Taft's declared policy of greater econ
omy in administering the affairs of
| the government.
The total estimates for 1911 are
1854, 1872, 1877. including the naval
building program. Excluding the in
| crease in the Panama canal estimates,
| the total estimates for 1911 show a
| decrease of $57 244.493.89 under the
| appropriations for 1910. Including the
increase in the Panama canal esti-
mates, the total estimates for 1911
show. a decrease of $42,s1S, 969.19 I'M
der the appropriations for 1910.
The ordinary estimated receipts for
the current ear are $648, 100000 and
the ordinary disbursements are $685.
075,62o. leaving a deficit in ordinary
receipts of $34.075,620. When the
payment on account of the Panama
canal and the public debt are added
the total deficit of the fiscal year 1910
is estimated at $73,075,620.12. The
estimated ordinary receipts for 1911
are 1872, 100000 and the estimated
ordinary appropriations $636,06S,-
| 672.51, or a surplus in ordinary re-
ceipts of $35. ,327.49. When the
Panama canal estimates for 1911 are
| added the surplus is turned into a de-
ficit of $12,132,197.21.
| Naval Building Program.
For the fiscal year 1910 the naval
building program was not included in
| the estimates submitted to the con-
| gress. When the naval program is
| 1910 and 1911. the total estimates for
1 1911 are $94,001.492.92 less than the
total estimates for 1910.
Secretary MacVeagh. emphasizing
the hard rightly of the present rev.
enue system, with its recurrent eco
nomical agitations and it's long inter-
walls of fixity," says It will be necessary
to meet these deficits to sell either
bonds or certificates of indebtedness.
'In due course he adds. ait would
seem that it must be made practicable
to both estimate receipts, with a close
approximation to the actual, and to
provide for their annual rise or fall by
some flexible factors in our annual
taxation
Reductions in the present estimates,
Mr.. MacVeagh declares, result from
improved handling of the government
work and the postponement of .ex-
penditures which can be delayed in
an effort to adjust irnme date expenses
and receipts. He sounds a warning,
however, that the reductions in appro-
/ priations will be disappointing unless
equal attention is given to other i'm
portant savings.
Secretary MacVeagh reviews the
organization, or rather lack of organ
ization, of the fiscal responsibilities of
of the government and the reorgan-
ization thereof now in progress. He
voices the hope that there will be
constant progress away from the ex-
IRENE DISCRIMINATION of the past and
observes that "even if our country is
rich it cannot afford to be wholly I'M
scientific in its appropriations.
Probably the most important recon-
mendation made by the secretary is
that the tax on bank circulation Sc
cured by United States bonds hereafter
deposited bearing interest higher than
2 per cent, shall be increased in exact
proportion to the increase in the rate
of interest above per cent He ad-
vises continuance of the rate of one
half of one per cent on circulation
} based on per cent bonds. Mr.. Mac
veagh says that if the Panama bonds
authorized py the law of August 5,
1909, should be issued at Ter cent,
, they would have a much better cir
J. culation privilege than the outstanding
2 per cents, the tax being only 1 per
cent Mr.. MacVeagh would make the
tax on them 1 u per cent: otherwise
| the already low market value of the 2
per cents would unduly decline.
At the same time. Mr.. MacNeagh
says it is desirable to complete the
legislation respecting the new
Panama bonds to make them avail
able so as to begin the settlement of
j. the Indebtedness to the general fund
of the treasury of the Panama canal.
He suggests that if the sale of any of
those bonds should produce more
, cash than the treasury balance needs,
some of the two per cents might be
2 bought in the market for the sinking
, fund, thus keeping the market price
of the latter class above par.
: Not a Two Per Cent Country.
Declaring that the government has
2 borrowing power, Mr. MacVeagh says
. it possibly would have been better
never to have issued two per cent
, bonds or bonds at any rate below the
governments borrowing power in the
/ open market. He says that as a basis
t for circulation they have no elasticity
that they are practically all held by
the banks as a basis of circulation;
and that the banks could suffer so
. heavy loss in an attempt to dispose
' of them that the influence of the sit
r uation is consequently decidedly
against the retirement of circulation.
! The issuance of per cent bonds at
liz says Mr.. MacVeagh, would not
change in any way the net interest
result of its transactions with the
banks Then again it would provide
bonds which investors would want and
which would have broad and whole
some market aiding materially in in
creasing the elasticity of the currency
e Secretary MacVeagh. discussing the
I rehabilitation Of the customs service
! in progress as result of the extensive
4 frauds discovered at the port of New
= York says:
= at is clear that the influence OF
: local politics and politicians upon the
y customs service, has been most dele
t FERROUS, and has promoted that iaxity
and low tone which prepare and fur
e nish an inviting soil for dishonesty
: and fraud. Unless the customs service
can be released from the payment OF
political debts and exactions, 1t viii
| be impossible to have an honest service
n for any length of time
IL Not Nearly ComDiete.
al He says that the work of reorgan-
v complete" but predicts that the nee
e essary prosecutions being made will
lead in the end to the establishment
of an n of he