New-York tribune., 1920-02-20
81 aDay Bonus
Plan Favored
By Congress
Compensation Money for
ex-Service Men Could Be
Raised by Bonds, Says
Representative johnson
Quick Action Demanded
Legislators Worried Over
Cost of Legion Program;
2 to 25 Billions Needed

WASHINGTON, Feb. 19.-Members Of
Congress are plainly disturbed by the
four-plank beneficial legislative pro-
gram put forward yesterday by the
American Legion. They all desire to do
everything within their power to make
the former service men contented and
convinced that the country is not un-
mindful of its obligations to them, but
they shrink from the financial conse-
quences Of undertaking to carry out the
legion's program in any substantial
degree.
The program determined upon by the
legion, with action by Congress de-
manded within sixty days, Is as fol-
lows:
First-Land settlement projects COW
ering all states.
Seeond-Home aid to encourage the
purchase of either rural or city homes
by ex-service men.
Third-Vocationa education for all
ex-service persons.
Observation-Disclosures Of compensation
or extra pay based on length of service.
While the former soldier will be re-
quired to take his choice between these
four forms of aid, and most of them
will favor the fourth, which is COM
monty spoken of as bonus, it was cal
culated to-day by member of the
House that it would take anywhere
from $4,000, 100000 to $4,000, 100000 to
carry out the four forms Of aid. The
consensus of opinion was that the four
plank plan was therefore incapable of
realization. Members who are con-
vinced that something should be done
for the former service men expressed
the opinion that the outcome would be
a cash bonus at the rate of dollar a
day for each day of service.
johnson Favors Cash Plan
"Opinion in Congress Is solidifying
in favor of giving the boys cash
bonus of dollar for each day Of serv-
ice," said Representative Royal John
son, of South Dakota, who enlisted as
q private during the war and advanced
TO The rank Of first lieutenant. II
rather expect to see that plan adopt
ed The money could be raised
by bond issue. The expert financial
opinion is that it would be better to
make the compensation in the form of
cash derived from bond issue than
TO give the bonds directly to the bene-
iciaries, as favored by the executive
committee of the Legion. Bonds di
rectly issued in small denominations
would pass from hand to hand so
readily and freely that such an issue
would be equivalent to initiating the
currency by the required amount.
which on the dollar -a-day basis would
be between $1,400,oo0,O00 and $780,
OOOoO0"
"The condition of the Treasury and
the financial condition of the country
generally is such that the present ses
sion Of Congress at least would not be-
justified in doing more than acting
on the fourth plank of the Legion's
program in the manner / have indi-
Gated"
Representative Frank W. Mondell, of
Wyoming, Republican floor leader in
the House, who believes that the situ-
alton is such that nothing on a large
scale can be safely done in the way of
soldiers beneficial legislation at pres
emit, discussed the problem largely on
the assumption that most of the for
mer soldiers would prefer adjusted
compensation" if they were to have
their choice, thus reducing the finan-
clal load to a minimum, and involving
an outlay of from 81, 400, 100000 up to
$1,000 900, 900, according to the rates. Of
compensation most generally favored.
Financial Troubles Feared
"To make any considerable appro-
pYiation to provide compensation for
ex-service men," said Mr.. Mondell,
debtedness of the country, would be to
invite sure financial difficulties. TO
embark upon any scheme running into
billions and requiring bond issue
would probably necessitate an interest
rate on such an issue Of per cent if
the bonds were to be kept at par,
would probably reduce to a very con-
siderable extent the value of the out
standing bonds of the government and
involve the risk Of going off the specie
basis for our currency. | am speaking
now of a commercially floated bond
issue to raise the cash with which to
pay bonuses.
"On the other hand, If the adjust
ed compensation or bonuses, were
paid directly by issuing bonds of small
dcuVHlltaliOn 10 tne eN-SeTVlCe men we
would have all the i'll effects already
referred to, with the additional dis
astrous effect Of probably increasing
tremendously the cost of commodities
through the resultant increase Of the
circulating medium, as these small
bonds would pass from hand to hand
as freely as money.
II am more and more convinced that
Il any considerable demands on the
treasury are to be met over and above
the estimates already made the only
safe way to meet them is through the
ievylng of direct tax in the form
pos lbly, OF consumption tax. heavy
enough to correspond to the additional
expenditure. To attempt to increase
the Federal outlays in any other way
by amounts running into the billions
would in my opinion. be to court finan.
cial disaster" ~
Allotment Return Urged
MIR. Mondell expressed the hone that
when the subject has been thoroughly
canvassed and examined the ex-service
men would appreciate the diHiculties
before Congress and meet the stu.
alton in the same spirit In which they
served during the war; On the whole
he thought that the soldiers Of thi,
war like the soldiers of the Civil War
would receive their reward from ,
grateful country as the years passee
and they come to need help as the,
do not need it now. He added tha
there was much consideration in Con
gress of the proposition to dispose Of
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