The sun., 1919-10-03
SOLDIERS BONUS
TO RAISE PRICES
Representative Plat Fears
Further Payment Would
Initiate the Currency.
DENIES MEN WANT 1T
Declares Another Great Bond
Issue Would Be Made
Necessary.
DENIES MEN WANT 1T
Special Despatch to THn SUI.


WASHINGTON, Oct. 2.-The Govern
ment cannot pay another large bonus to
service men without causing further ex-
mansions Of credit and mutations OF cur
rency that will bring higher prices.
Representative Plat IN. ". chairman
OF the House Committee on Banking
and Currency, declared in speech to
the House to-day.
Mr.. Plat denied the statements OF
Representative Good (Iowa), chairman
Of the House Appropriations Commit
tee. that imitation OF the currency was
the principal cause OF high prices. Con-
sress. he said, must exercise the strictest
economy to prevent another bond issue.
which would bring higher taxes and in
crease the imitation Of the currency to
dangerous limit
IF we should adopt such policy"
said Mr.. Plat "whether to pay a So
called bonus to the splendid young men
who have survived the great war and
are now back in their former civil oc-
cupations, or In pursuance OF some OF
the other extravagant ideas Of govern
mental
Gates, we would put back the wheels OF
progress a year or more. Another great
bond issue would be necessary, just
when the Treasury Department is
making every effort to avoid such steps.
would Increase Taxes.
Further increases in the tax burdens
of the country would doubtless be nee
essary, There would be further in
evitable imitation of credit and currency,
and instead of reducing the cost of liv-
ing, toward which we have made some
start, we should start prices mounting
again. For my part 1 do not believe
that any considerable number of re-
turned soldiers would want us to do
that, II they understood the situation,
and think that great many of them
do understand il. because comparatively
few have been influenced by the propa-
ganda which has been so persistently
carried on among them by those who are
advocating this so-called bonus.
II am sure that they do not want any
effort made to measure the value of
their service to the country in dollars
or cents, or have anything done that
will injure the country or prevent its
recovery from the effect of the war"
Old Bonds "UndtGested."
Regarding the general financial status
Of the Government, Mr.. Plat continued
when you reflect that we have sold
bonds for more than $4,000. 600, 900
since April, 1917, and have paid taxes
to the amount of $4,000. 100000. the
fact seems almost incredible. Five years
ago no one would have believed it pos
sibleY While the Government has re-
nj y
from these enormous taxes and bond
sales, the bonds are not really paid for
yet The banks are still carrying sew
eral billions of them only partly paid
for. and the Federal Reserve Banks arc
still carrying war paper amounting to
1884, 900, 900. This is in a large meas
ure the Il ouble to-day. The bonds are
still, too many of them, 'undigested,' In
financial slang. The people have not
yet been able to save enough money &c
pay for them ard put them away v
their strong boxes.
They are making progress at it and
IL production could keep on uninter
rupted by strikes and curtailments Of
one kind or another the steady payment,
made at the banks by the thrifty woul6
very soon make themselves felt.
Small Increasesin Money.
I'm spite Of the tremendous bono
sales and taxes the amount of money
Of all kinds. outside of the Treasury
Increased only about s1,042.000,00 900 be
tween April, 1917, and July 81. 1919
while national banks deposits increased
less than $500, 900, and deposits IL
all banks not more than $4,000, 900, 900
"Of course there was considerable in
crease of currency and credit before thu
end Of the war. an increase of the tota
stock Of money outside OF the Treasur,
of S1.2S2. 962.000 between. July 1, 1914
and April 1917. nearly all of which
however. was gold. That increase wa.
due to the great purchase of war ma
terials and foodstuffs here by the ma
tons that afterward became our asso
ciates In the war. Their purchases mad
under the stress of overwhelming neces
sity at a price at which our manufac
turers and dealers fixed to suit them
selves on basis of big profits were tn
chief cause of the high prices, whicl
naturally continued to advance consid
erahly after we entered the war, Blu
which were in the main raised befor