The Barre daily times. (Barre, Vt.) 1897-1959, 1916-12-06
BALANCE THIS YEAR,
BUT DEFICIT NEXT
Secretary MeAdoo Figures the Nations
Finances - National Defense Esti-
mates Are Causes for Expec-
tation of Deficit.

Washington, y. G., Dec. 6-Secretary
McAdoo's annual report of the govern
mont's finances, presented to Congress
to-day, estimates that the fiscal year
ending June 80, 1917, will show a bal
ance of $llj,000,000 in the general fund,
but that the figures year later-June
30. 1915, will show a deficit in the gen
eral fund of Sls5,000,000.
I Preliminary estimates place the cost OF
conducting the government Tor the com
7 ing fiscal year 1918, exclusive OF the post
al service, which is expected to be self
sustaining, and other deductions, at ST.
27s,02l 900. The ordinary receipts Tor
the fiscal year 1918 he estimates at
i Sg95 $50. 600, which is 1882 Al 900 less
than the estimated expense.
Estimates OF large expenditures for
national defense carry the estimated
outlay beyond the estimated income.
For the fiscal year 1916 now drawing
to a close, the secretary reports great
prosperity and expresses greatest comb
dence for the future. During the past
year" the secretary says, "the prosperity
which set in so strongly during the fiscal
year 1918 has grown in strength and
volume and Is now widely dlliused
throughout the United States. Funda-
mental economic conditions have never
been more sound In ali ines of indus
/ try, efficiency of organization and pro-
duction have reached the highest point
in the country's history. General coli
dence in the future, healthful enterprise
and development have been marked char
acteristics of the year.
"The financial strength of the United
/ States-the greatest in our history
/ gives us a commanding position IN world
/ finance We have been transformed from
debtor into a creditor nation, On No
vember |, 1916, the stock of gold com
4 and bullion in the United States was
estimated at 5000, l36,976, an increase
of STA 597 s04 in the past 10 months
/ This is the largest stock of gold ever
i held in the United States or in any
other country of the world. Through the
/ operations OF the federal reserve system
and with our abundant supply Of gold as
/ basis, the credit resources OF the Unit
ed States have become more than sutfi-
/ cient for home demand, and we have
/ been able to finance our great domestic
and foreign trade without strain and TO
extend vast amounts OF credit to other
nations throughout the world.
/ The experience Of the past two years
/ has brought into strong relief the value
/ of the federal reserve system. 1t IS not
! too much to say that our great prosper
lily could not exist without it. The use
/ fulness of the system has been broad
ened recently by the amendatory act OF
f Sept. = 1916 which renders it more at
i traetiye to member banks and increases
| the scope and services of the federal re-
serve banks Due to the transference OF
vault and other reserves to federal re-
serve banks, authorized by the original
/ act and amendatory act, the resources OF
said banks are now more than S650,000,-
+ 900. while the total reserves held are over
/ 500, 000.0 900. and, in addition, more than
$3.50, 200, 600 is held by federal reserve
agents as special security against federal
reserve notes. About one-fourth OF the
country's stock of gold is thus modified
| in the hands of the federal reserve banks
and agents,
"The increasing strength and etfcien-
CIV of the federal reserve banks have en-
abled them to enlarge their direct service
to the business community through the
| introduction of definite and compre-
hensive system for the par clearance OF
checks throughout the country
Rates of discount at federal reserve
banks have continued low throughout
the year, and most Of their open market
paper, consisting largely of acceptances
growing out of foreign trade, has been
taken below 2ha per cent basis. Rates
of interest throughout the country have
been reduced and stabilized, with great
advantage to the business OF the coun-
try.
ut would have been impossible to
finance our vast domestic and foreign
trade without the facilities provided by
the federal reserve system. Not only
has il met the normal and extraordinary
needs OF business, but it has established
confidence securely Business has been
able to go forward without apprehension
and the several crises which the country
has faced in its international relations
during the past two years have been
accompanied by no disturbances and
have caused not even tremor in the
tlUduCidl WI ~ nv NlpFS VI ArAc "HN
1916 were financed without difficulty and
to the great advantage of the farmers,
and the industrial troubles, which at one
time seemed imminent, because of the
threatened railway strike last summer,
were not accompanied by the slightest
financial uneasiness.
Happily the country has been at peace
and business and enterprise have had the
largest opportunity for favorable devel-
opment under the most suspicious con
ditions.
IF we make intelligent use of our
great power and exceptional financial re-
sources, we can cope successfully with
any conditions the future may develop.
zone OF the features of the report IS
discussion OF present methods of con-
strueting public buildings.
al am convinced" says the secretary,
that the methods pursued by the Con
cress for the past 10 years of providing
federal buildings through so-called omni-
bus public building bills have resulted in
the construction of many public build
inps in small towns and localities where
they are not needed. and at a cost which
is clearly uniustified by any actual re-
ouirements of the communities in which