Pine Bluff daily graphic., 1920-03-05
M'AD00 ADVOCATES BILLION DOLLAR CUT
 IN FEDERAL. TAXES Says Present Burden is 1njur-
 in Business Greatly
SUGGESTS REMEDIES
 FOR EUROPEAN LOSS
Funding of Interest on Ten Billions and Delaying of the Estab- lishment of Sinking Fund
 Urged

Washington, Mar. An immediate billion dollar reduction in federal taxes was suggested in a statement issued today by William G. McAdoo, former secretary of the treasury. The present tax burden is too great, he said, and is "having an injurious eff feet on business"
 MT. McAdoo proposed that collec- ton of tax to establish a sink ing fund for retirement of the war department, which was recommended by Former Secretary Glass to begin fifth the fiscal year, 1920, be postpon- ed for two years, and that the defer red payments of European interest be funded until Europe is in a posi- tion to pay it's interest charges.
 "The financial policies of the na- tion as embodied in future congress sional legislation" said Mir. McAdoo, should realize the utmost economy is expenditure and might well fund in long term bonds $1,000,000 ,000 per annum for two years of the amount now recognized by taxation.
 "Under the laws tax to establish one per cent sinking fund to re- tire bonds now outstanding is to be collected beginning with the fiscal year, 1920.
 "This might be postponed for at least two years and thus reduce the tax burden by $25O,OOO,O00 annually There, too, is the debt which Europe owes us and which amounts to about ten billion dollars. If economic res toration of Europe had proceeded enough so that Europe could now pay interest on the debt Gas she vii be able within a few years) we should have an income of $50,OOO,OO( i from this source. But that is not now available.
 Fund Interest Charge.
 "Why not fund that amount agains the day when it wilt come back tt us? By postponing for two year . establishment of sinking fund ant funding the deferred payments O Europe's interest, we should cove, $75O,00O,OO0 of the billion dollars b! which our taxation might be reduced by discontinuing purchase of Liber ty bonds for retirement under pro visions for existing law. The treas ury would be relieved of a larg burden now reflected in the floating debt and which otherwise will hav to be made up by taxation. would seem that reduction of ou tax will for the next two years il this manner would be accomplishe and that it would involve the issu ance of additional bonds to the ex tent of probably not more than on and half billion dollars
 q trust that the ways and mean : committee of the house of represen
 tatives in which all tax measure
 must, of course, originate, will con
 slider this question in its broad rela
 tions to our general economic we
 fare. The immediate burden of tas
 ation is too great. It is having a l injurious effect on business. It
 contributing factor of large propol
 tions in the high cost of living. Il
 inevitable tendency is to stifle ne :. enterprises and to throttle initiativ It is both unscientific and inequi able. In view of the approachin z decline in our export trade with tf I inevitable reduction in the volume {
 business in the country, it will b = come doubly important to revise ar > to reduce the tax burden througho1 this period of readjustment."