New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-12-10
Calamity Averted and
Confidence Revived,
He Says.
GOLD DRAINS FROM
EUROPE WITHSTOOD
Credit Improved by Co-opera'
ton with BankerS-ESti-
mates for 1915.

partment 20 restore confidence ana
support American business, shaken ana
weakened by the European war.
"A catastrophe Of calamitous proper
TONS said the report, "was narrowly
averted. 1t is a tribute to the economic
strength and soundness Of the country
and TO the patriotism Of its people IN
every class and walk of life that the
shock has been so admirably WIN
stood. A panic of cataclysmlc pro-
portions might easily have resulted
and il il had, the injury 70 the country
would have been incalculable ana many
wears would have been required 10
overcome its effects"
Nv formation of the Federal Reserve
Bank system, SlO0000,000 gold pool,
the S135.000,000 cotton loan fund, ls-
sues of emergency currency and the
deposit of crop moving money IN ma,
tional banks the situation was relieved
and confidence was revived, the Secre-
Through the prompt and effective
action of the Treasury Department ana
with the cordial and intelligent coop
Grafton of the banking and business IN
terests Of the country the danger has
been averted." the report adds.
coincidence has been restored and
snecie payments have been maintained
in the face of the world. At no time
since the war broke out has there been,
20 the knowledge of this department,
with the exception Of few isolated
cases, a failure on the part OF any sol
vent national bank to honor It's checks
in currency or money or to meet lts
OBLIGATIONS. The general revival OF
business throughout the country Is
the hest evidence that confidence has
been restored There is every reason
whv the country should look forward
10 the future with confidence SO tar
as its trade. commerce and industry
are concerned"
Drains from Europe Withstood.
In spite of drains from Europe.
where the nation owed about S450,0OO,-
600 at the outbreak Of the war, Secre-
tarv McAdoo says that the Treasury's
cold holdings show a reduction OF only
SIS. 656.2 90 on October 81, 1914, com
pared with holdings of $l,258,2lS,35f
on June 80, 1913.
Secretary McAdoo referred In some
detail 10 his action against banks
which, he announced, were boarding
money, piling up reserves and eharg,
inc HIGH interest rates without good
ranse II was disagreesble duty, he
said. but one which resulted in de-
term;nation on his own part to with
draw government deposits from banks
not using such funds for the benetit
Of their communities.
"This action" he said. "had salu-
tArv influence, because 1T was followed
nv a general looSening up OF credits,
end while II is not for moment con
tended that the improvement is attrib-
utable wholly 70 the action Of the de-
nartmcnt. IL is, nevertheless, believed
10 have had a beneficial effect upon the
situation"
The Secretary makes several recon-
mendations. He suggests that the war
revenue tax law should not expire on
December 81, 1915, but that its oper-
alton should be extended until the end
Of the European war, by proclamation
Of the President.
Discussing the income tax law, the
Secretary advocates a change IN the
law so that persons having a gross IN
come Of $4,000 be required tc make a
return, instead of those persons with a
net income Of that amount or over.
Although the law did not produce
the revenue expected, the Secretary
saws. it has proved satisfactory. He
explains the administration of a law of
that character has many obstacles TO
overcome at the outset. Taxing the
tables of returns. Mr.. McAdoo infers
that there must be many who failed to
pay the tax
Tariff as Revenue Measure.
THE collection of revenue for the
fscal year ended June 80, 1914 says
MIR. MeAdoo, "shows the success of the
tariff act of October 3, 1918, as a reve-
nue. measure" He goes on TO show
that this act was estimated as the pro.
duoer OF S270,000000 in its first year
and that there was actually collected
S292, 320.0l4. That, however, included
nine months under the new law anc
three months under the Payne-Aldricf
law. He shows that the total raise,
under the new law. with its corpora
tion and income tax features, was 1858,
70i.2s9. or 9.S03. 593 in excess of th'
previous years receipts under the pre-
ceding revenue measure.
"The European war" said the Secre
tary. seriously affected the revenue
OF the government from imports. Tn
revenue from customs for October
1914, was S16,27l .S29 and for October
1918. IL was $50, l38049, a decrease o
Sl3,s66, 22O. The reduction IS solel
due 10 the falling off in importations
indicated a yearly decrease OF betweel
$50 900 900 and 500, 200. Ii is OBJ
vious that these estimates cannot b
accurate, as no one can forecast tn
course Of events while the titani
struggle in Europe is IN progress. IL
keep the Treasury in strong condition
in these abnormal times was obvlousl.
the first duty Of the hour. Upon i
largely depended the safety OF business
and finance in this country"
Receipts and Disbursements.
Secretary MeAdoo estimates the re
ccipts Of the government for the hsea
gear 1915, ending June 80, at $I2S,
100, 900. including S220,000,000 from
customs and S54,000.000 from the
emergency war tax. Exclusive Of the
Panama Canal. he places disbursements
~ S7l0,0O0,000 for the current year
Counting upon s28.000,000 for the
canal out Of the Treasury's general
fund, he places the excess Of disburse-
aents at $iO,000,000.
For the fiscal year 20 end June 80
1916, Mr. MeAdoo says he expects re-
ceipts amounting 20 735,OOO,0OO, with
customs bringing $240,000.000 and the
emergency war tax S44,00O,OOO. The
secretary places ordinary expenditures
for that year at $713.765, Jos, with $lo,-
600 900 additional for the Panama
Canal, leaving q slight surplus
In his estimates Mr. MeAdoo puts
the return from the income tax Tor
the current fiscal year At $oO,O0O,OOO;
$40 400 600 each from individuals and
coynorations. For 1915 he expects the
INC tax 70 produce $85,0OO,0OO, hair