Evening bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1895-1912, 1911-02-15


thought in order to avoid another pc
riod of financial deficiency at an early
date.
FINANCES.
The Situation. The government
cannot, any more than private en-
terprise, be successfully financed on
mere wishes, good intentions or opti-
mism. The businesslike or scientific
method is absolutely essential to safe
ty and progress. Action must be based
on ascertainment of the naked facts
and logical deductions from them. The
assumption on the part of some that
because there was a net balance of
1888 ,097.72 on December 81, 1910,
there is plenty of money for all pur
poses and that the only question is
how to spend it, illustrates the proven
bal danger of a surplus, because it in
spires extravaganza and blinds to
facts.
In the first place the real surplus
for purposes of increasing appropria-
tions is the cash balance Immediately
before the bulk of the revenues come
in and not shortly afterwards, for the
government has to be maintained until
the next revenue season, or, speaking
with reference to present conditions,
for a third of a year from the 31st of
last December until the next semi
annual payment of taxes In the sec
ond place, not only should allowances
be made for maintaining the govern
ment from one taX-paying period to
the next, but there should, if possible,
be maintained a surplus as a margin
for emergency expenditures and tenn
porary reductions in revenues. In the
third place, the real meaning of the
apparent surplus and the possibilities
of what may safely be done with it.
must be ascertained by an analysis of
its causes and an investigation as to
the probability of a continuation of
such causes. u
There were special reasons for
large increase in revenue during the
last two years which will not hold for
the coming two years, and other rea-
sons which will make necessary an in
crease in running expenses which
should use up the greater part of the
real surplus. For instance, owing to
the high price of sugar, the general in
come taxes amounted to $437 ,033 go
y
91722 more than the average for the
nine years during which those taxes
have been collected, or $43, 093 43 more
than they had ever been before. While
they will fall off little, if any, during
the present year, because this years
taxes are based on last years income,
they will fall off heavily next year be-
cause of the low price of sugar this
year. Again, owing to an, unusually
large number of deaths of wealthy peo-
pie, the inheritance taxes yielded dur
ing the last fiscal year $3.50, 153.11. as
compared with an average of only $21,-
S27.S7 for the ten years during which
those taxes have been collected, which
average itself is, because it includes
the large receipts of last year, larger
than the entire amount received in any
preceding year. Again, during the last
fiscal year the revenues from both
sales and rents of public lands were
unusually large; and, owing to the re-
cent amendments of the Organic Act,
the sales must necessarily be smaller
hereafter, the rents may be consider
ably reduced by the withdrawal of
cane lands for homestead purposes,
and considerable portion of the rev
enues must be used for surveying and
opening lands for homestead purposes,
as provided in those amendments.
Again, during the last two years a
special effort was made to collect back
rents, taxes and other government
claims, which has resulted in an in
crease of revenue to the extent of per-
haps 100000, which cannot be count
ln
such claims have now been collected
pretty well up to date. Again, in view
of the stringency two years ago the
whole financial situation was gone
over most carefully with a view not
only to the discovery of new sources
of revenue and permanent methods of
economy, but with a view to cutting
down appropriations as much as pos
sible until financial conditions should
improve, with the result that many APP
were reduced below the
point of permanent safety, so that now
they should be restored or increased
in order merely to "catch up" as well
as to meet growing needs which can
not be avoided
1t will readily be seen that with the
absolutely necessary increases in eX-
penditures for the coming biennial pc
Rod and the absolutely certain large
in the revenues, there will
be comparatively little surplus avail
able for permanent improvements out
of general revenues.
Estimates of Expenditures for Next
Biennial Period.
These, for both current and loan
funds, will be submitted in separate
message.
Permanent Improvements. 1t is evil
dent from the foregoing that perma-
nent improvements during the coming
period must be provided for mainly
out of loan funds. So little has been
done in this direction for several years
past that there is pressing need that
much shall be done during the next
few years. Only $4,000 of bonds
have been issued during the last five
years as compared with $3,350,000 dur
ing the previous two and a quarter
years. The total amount of bonds now
is $4,029,000 or only 2.6S
per cent. of the assessed value or
Redemptions to the amount
Of $4,000 have been made during the
first eighteen months of this biennial
period The permanent improvements
required will be considered more par
Licularly elsewhere in this message,
under the appropriate headings, and
perhaps also in special message, but
in general it may be stated here that
The principal needs are for wharves,
the Honolulu water and sewer works,