Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1919-09-26

the first place, the mere annual interest on
it comes to approximately eight hundred mil
lion dollars. A measure of this amount may
be gained by comparing it with billion dol
lar expenditure before the war which was
adequate to run the government for year
In addition to this annual interest charge
which the taxpaying public must face, it is
of course advisable to arrange for the ulti-
mate payment of the national debt. 1t is
not generally appreciated by the public that
arrangement for the discharge of this debt
has already been made. When Congress
passed the Victory loan bill it provided sink
ing fund which will eventually wipe out our
whole war debt.
Section vi of the Victory loan act lays
foundation for taking care of this huge item.
The experts of the treasury department
worked out a very neat little problem in
mathematics which is to serve the ultimate
purpose of sponging the slate. These ex
perts show how any debt may be discharged
in a period of twentythree years by very
simple procedure. The plan is as follows:
Whatever the amount of the debt, appro-
pirate 21a per cent of that debt each year
and put it in the sinking fund. This money
so appropriated is then invested in 4 IL per
cent cent bonds. This annual appropriation,
plus the interest which it accumulates, will
wipe out the debt in twenty-three years. This
is true if the debt is thousand dollars, a
million dollars or a billion dollars. 1t is
true of the eighteen billion dollar debt which
positive elimination of that debt has been
provided for by law in this sinking fund
section of the Victory bond act.
Two and one-half per cent of eighteen
billion dollars is four hundred and fifty mil
lion dollars. This four hundred and fifty
million dollars, or nearly half as much
money as was necessary to run the govern
ment for year before the war is for a
period of twenty-three years, to go annually
into the war debt sinking fund. The tax
ont ID hat ~f
money in addition to the interest that must
be paid on the debt. This interest of eight hun
dred million dollars, plus the sinking fund
payment of four hundred and fifty million dol
lars, gives total of one billion, two hun
dred and fifty million dollars as the annual
burden that the taxpayers of the United
States will have to bear as the result of in
debtedness coming out of the war.
This means that the amount of taxes that
the government must raise, now that the war
is over, is a little more than twice as much
as the amount of money it was called upon
to raise before the war came. The govern
ment is quite nonchalantly meeting the
necessary tax burdens to pay current ex-
penses, interest and sinking fund, and to
have a considerable item of velvet after
those obligations are met.
The income of the treasury department for
the current year will be six and half bill
lion dollars-about enough to break even on
expenditures. In that figure there will be
Victory loan installments to the amount of
one billion dollars. They are an unusual
resource which will not be included in the
future annual income schedule. The present
tax scheme, however, will produce five and
one-haIf billion dollars a year, and that is
much more money than will be needed to run
the government, pay the interest on it's in
debtedness and provide for it's sinking fund.
Two and half billion should do this
SO does it become evident that taxes may
be reduced as much as one-half and leave
the government a sufficient sum of money
Or current expenses, or the rate may be
nigh and the money go toward the more rapid
reduction of the national debt At any rate.
the whole financial problem of this govern
ment is now on very firm basis, where the
only vision of the future is the inflow of
quite adequate funds from our great national
prosperity to finance us, and eventually to
lift that stupendous burden which the war
has placed unOn lis