Omaha daily bee., 1918-12-05
M'ADOO MAKES
REPORT Of us.
WAR FINANCES
Cost of Fifteen Months Is
Thirteen Billions, But
Some Is Permanent
Iy Invested.

Washington, Dec. 4.-The fnan-
cial history of Americas part in the
war is set forth by Secretary Nc
Adoo in his annual report drafted
before his resignation, and made
public today by the treasury. !, is
the history of how the American
people paid billions in taxes, raised
four great Liberty loans and created
tremendous pool of credit with
which the treasury, through its
many war agencies, paid the bills OF
the army and navy, the shipping
board and other government depart
ments. loaned billions to the allies
and millions to war industries, help
ed support the families of soldiers
and sailors and tided farmers over
periods of financial stringency. -
The payment into the treasury OF
vast sums in war taxes and from
bond sales" said Secretary McAdoo,
and the transformation of our var
led and complex economic life to
the supreme task of winning the war
have been accomplished without
shock of financial disturbances. The
credit and business structure of the
nation remains sound and strong.
The results OF the four Liberty loans
are tribute to the patriotism OF
the American people and to the
economic strength of the nation"
Final Accounting.
The report constitutes Secretary
McAdoo'si final accounting of his
stewardship before retiring as the
nations finance minister. Through
out the report. Mr.. McAdoo
refers repeatedly to the remarkable
achievements of Americas civilian
population in providing the money
and materials for war, and acting as
the "eager second line of defense"
Commenting on the showing OF
financial arrangements in great de-
tail by the document. treasury
Librarians recalled that the financial
history of the Civil war is buried i'll
a great stack of musty ledgers, and
probably never will be officially
compiled.
For the fifteen months ending last
June 80, Secretary McAdoo esti
mated that the actual cost of the
war, with allowances for the gov
ernment's ordinary expenses in ordi-
nary times, amounted to $l3,222,-
100000. Nearly half Of this, or So
4po,000000, went into permanent ip-
ycstments, in the form of ships,
shipyards, war vessels, army camps,
buildings, and in~icans to allies or
TO American war industries. OF the
wears expenses $40 per cent came
from taxation.
How 1t Was Spent.
The civil establishment of the
government during the year spent
Sl,507 100000, while the War de-
partment spent 5,684,000,000 and
the navy ST $685. 100000. For support
Of the army alone the government
paid out $4,4l2,000,000. The naval
expenditures included the construc-
ton of new vessels, machinery,
armament, equipment and improve
ments at navy yards. Total ordinary
disbursements for the year amount
ed to ,966.000,000 and ordinary re-
ccipts, excluding money received
from Liberty loans, amounted to
$4,l74.DG0,000. Loans to allies dur
ing the year amounted to $780,
000000 additional. .-
Looking forward. Secretary Nc
Adoo found great difficulty in lore
casting expenditures for the current
fiscal year, which ends next June
60, on account OF the sudden conf
ing Of peace. Estimates which he
presented are based on calculations
OF each department i'll advance OF
revisions since the signing OF the
arinistice and he does not consider
them reliable. With this explana-
ton Mr., McAdoo forecast expendl-
lures for this year at SIC, 6S7 600 600
Tor government purposes and S4,375,-
100000 for loans to allies and S2,s40,-
100000 for redemption of outstand-
ing certificates and other debt can
collation.. Total estimated disburse-
ments for the year were put at Sz7,-
7lS,00C0oo
Estimate May Be High.
Against this estimate. which actual
expenses at the rate OF little more
than a billion and a-half dollars a
month to date indicate is too high,
Mr.. McAdoo calculated that the
government will receive about S.
lO0000,0O0 before the end of the
fiscal year next June so, from IN
come and profits taxes, $l,lOQOO0-
600 from other taxes, Sl90,000,OOO
from customs and $555,000,0OO from
miscellaneous sources. including
100000 from increased postage,
making estimated receipts from or
binary sources 64o,000000. In
Il addition, he figured roughly on a
little more than $4,000, 100000 from
further issues of Liberty bonds and
$l,200,000000 from war savings
These figures added to receipts
from Liberty loan bonds already
sold make $l4,l6S,000,000, the total
Of popular borrowings expected
during the year. On this basis total
n estimated receipts would be ST.,
022,000,000 or $6.695,000,00O less
than tentative estimates of dis
bursements. Actual developments
are expected to change these cal
culations greatly.
Concerning the tremendous part
played by the federal reserve sys'
tenn during the war Secretary Nc.
Adoo had this to say:
The federal reserve system has
permitted the enormous transactions
connected with the financing of the
war to be carried through without
shock or disturbance and its services
will not be less important to the