The Bridgeport evening farmer., 1910-12-08
SECRETARY M'vEAG IFS RtPJRT Economy Attempted in the Expenditures of the Gov
 ernment
ernIQent
"We Can Continue to Have 2 Panics or We Can Stop Having Panics"- "-Frauds
 in the Customs Service.


 the keynote of the annual report of Secretary MacVeagh. of the Treasury Department which was sent to Con gress today.
 The estimated ordinary expendi- 494,013. Including Panama Canal 6,92O,S47 which will be paid to the Treasury by the sale of bonds,-the grand total is $6S7,414,- S60. The total appropriations for this year were $721, ,313,900.
 nary expenses of the government were. for 1910, $6s3, 3,166; for 1911. $683, 3,46S,900. The estimates for the next fiscal year, beginning July l, are 630,494,O13.
 There are difficulties in the way of ceipts but in the best light available Secretary MacVeagh places the amount at $6S0.o0O,00O. These ordi- nary receipts if realized, will exceed the ordinary disbursement by $49,- 505,9S6. But taking also into ac- count the estimates for the Panama Canal the deficit for the next year
 Reform of the currency is the next subject considered. Concerning it Secretary McVeagh says:
 we can continue to have panics or we can stop having panics. exactly as we prefer. It will not cost a cost us untold millions and untold suffering every time we had one. It is for the government to say whether it will have panics in the future or whether 1t will .not.''
 Short as the present session is 10 be. the Secretary says, it would be a great step forward if the subject of & remedy for existing financial conditions could at least arrive at some form of def1niteness and con- centration before Congress adjourns. It has received great consideration during the past two or three years by economic authorities under the lead of the National Monetary Com mission. There should be no need of further hesitation, he believes, in taking action.
 "The whole financial history of rha country" according to the report, ''is long series of troubles and agita- ton, and now that we have in sight the esta ablishment of real and per manent banking and currency sys- tenn that will be both safe and sane, it makes one impatient to see it ac- ocmplished."
 As to the weaknesses of the panic breeding system' Secretary Mac Veagh declares: we have no sys- tenn of reserves. Our banking sys- tenn destroys our reserves. It con- centrates in NewoYOrk what are pro- tended to be reserves and then forces the New York banks to lend and abolish them.
 We have no way to increase our currency when it is needed, except under the Aldrich-Vreeland law, which will soon expire and which is only intended for emergencies. Under our system ordinary transactions of busi- ness cannot go forward uninterrupt- ed in a time of stress and strain. And yet the final test of a banking and currency system is that the ordinary banking facilities needed by business shall be provided at all times and under all circumstances"
 Int continuing deficit created by the Panama Canal expenditures the report says, iS bringing closer tine time when the indebtedness of the Canal to the general fund of the Treasury will have to be paid, at least in part, by a sale of some of the Pariama Canal bonds authorized by Congress to the amount of $290,- 5ss,oOO. These may be issued at any rate of interest necessary up to three per cent, If the bonds are to be used as a basis for bank circulation. the Secretary points out, the tax on the circulation should be 1 F or two per cent. in order to protect the two by the banks. On the other hand, if authority were given to issue $50,- 00O,o0O or s100.000.00O three per cent. bonds without the bank circula- tion privilege, it would be possible to gauge experimentally the rate at on an investment basis, and officials would then be better able to formu- late a financial policy for the future
 AS to customs, the report in part says: "The sugar frauds were found to cover in one form or another near York. The total recovery of duty amounted up to $3.400,0O0. The ex- istence of such extraordinary frauds involving corporations of the largest and most responsible kind has been such a revelation as to throw sus- and to oblige us to investigate and overhaul in all directions.
 3It became necessary from the out set to correct the palpable vices of the system controlling impOrtations by steamship passengers. It was not simply that actual tourists were vio- lating the laws, but the irregularities Of the services on the passenger docks and the example set by those tourists had made the Atlantic steam ships open runways for professional smuggling. Genuine passengers and
  guise of genuine passengers were not only smuggling by means of false de- clarations, but they were bribing the officers. cheating the government, making false statements, and bribing officials was regarded as a joke. The inevitable, however, is coming to pass. American citizens are more and more conforming to the law anl to their obligations as citizens. We are annually collecting from pas sengers at New York about four times as much duties as before. The percentage of increase is equally large at Boston.
 Numerous import lines are under and the amount of laxity and dishonesty that has crept into the import business through zun- is astonishing, not to say appalling"
 Politics have been to a large ex- tent eliminated in the customs ser vice at New York but MacVeagh says that final excellence can be attained only by the inclusion of all non-poli- tical officers in the classified service.
 'sThere is no practical way" Mac veagh says, "to put the government service properly on it's feet without vice retirement. Fortunately. this re- tiring provision can be made with out the expense of one dollar to the 
 Congress Is asked also to provide for the retirement of the field force of the Life Saving Service.
 When the public expects that there could be a saving of s3OO.OOO. a i year in the exnenseS of the exeoutiva