Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1917-10-01
new LIBERTY LOAN

The new liberty loan Of three billion dollars has
been announced by the secretary Of the treasury. The
new issue will differ from the old in two important par
dculars. First, the interest rate 10 4 per cent instead of
3 Ia; second. these bonds will be taxable under condi-
lions which did not render the former issue 20 liable.
Under the terms OF the former issue tho bonds of
the first loan may be exchanged for those Of the second.
thus enabling the subscriber to avail himself Of the
higher interest rate. At tho same time this privilege
also Is extended to the bonds Of the new issue, 80 that
If. during the period Of the war bonds should be issued
bearing a still higher rate, those now to be issued could
be converted into bonds Of the later issue. This arrange
ment has BEEN made in order that those who subscribed
to the earlier issues may not receive any injustice In the
matter Of interest rates.
In the matter Of taxation the new ARRANGEMENT is
better than the old. The exemption of bonds of the nrst
issue from all income taxes made it possible. under GER
tain conditions. for individuals Of great wealth to escape
taxes which would otherwise be imposed on them. The
new bonds will be exempt under the income tax from
what may be known as the straight income tax, but will
be liable for all surtaxes. This removes an Objectionable
feature.
1t will be very surprising II tho subscriptions to the
new issue do not greatly exceed. in proportion tho,a
Of the old. The hrst issue was presented to q public
entirely unfamiliar with the purchase Of government
securities. The whole subjsct. was new and strange. Just
as the war itself was new and strange. Now We have
become moro familiar with the war and its needs, and
there Is a better understanding Of tho bond issue. It is
q known fact that Thousands of people have for weeks
been saving systematically for the purchase Of the bonds
OF this issue, and many people who borrowed the money
with which to pay for a single $50 bond of the first issue
will be able to pay cash for one or more Of the new
bonds.
From every standpoint it IL important that the new
loan be subscribed, and greatly over-subscribed. The
government needs the money, and must have it. War
10 an enterprise which consumes funds rapidly. The
funds must be made available. Large sums, greater
than ever before in the history Of the country are being
raised by direct taxation. But these sums are wholly
inadequate for immediate needs. More money must be
had. III 1T cannot be borrowed from our own people
an unthinkable caseIt must be taken from them in
taxes The taxation that would be necessary in that
event would dsmoralize every industry In the country.
would stop ordinary activities. and bring suffering to
our entire population. The only safe plan IL to borrow
5udteioualy and tax with discretion. preserving the proper
balance between the two.
The loan must be over-subscrtbed for the moral
eheof that this will have on our own people, On our
sllies. and on Germany. The evidence of loyal support
OF the government that a large subscription will furnish
will have . stimulating effect on our own people. The
psychological effect of the mass movement will Do ire
mendou& Our allies across the seas will BE- chsersd BY
evidences that our people are unitedly with them. in
providing both men and money for the prosecution of
the wal: And the Germans are sadly in need lnst now
OF convincing proof that in addition to- their other
troubles they have q united America to contend With