Perth Amboy evening news., 1920-05-22
EIGHT BILLION
DOLLARS DEBT
Mr.. American Citizen Will be
Called on to Reach Into His
Pocket for That Amount
nv w. 8. MANN

bn W. >. MANN
WASHINGTON May 22-Wfthin
thes next three years Mr.. American
Citizen is going to be called on to
reach into his purse n take there
from something more than eight bill
lions of dollars to meet the outstand-
ing obligations of this country that
viii mature within that time, in ad-
dition to the regular expenses of add
ministering the government, which
Will require a few more billions.
You will not hear much during the
next few months concerning the bill
lions that must be raised within three
years, either from the Republicans or
the Democratic members of o N
gress," said one House member in a
private conversation a few days ago.
But all of us know that as soon as
the election is over we are going to
be face to face with the disagreeable
task of obtaining every available dol
lar to meet the obligations that will
shortly fall due. We LAY assurance
that it can be done in a satisfactory
manner. but the task is one that
neither the majority nor the minority
party will relish."
The biggest single item to be met is
$4.405 900. 900 in victory notes, exclu-
sive of interest, that will mature.
Treasury certificates constitute an
other $4,000. 900, 900. while war saw
ings stamps n thrift stamps which
will mature within three years come
to an additional million. Included in
the second amount Is the floating debt
represented by $2,2SO. 10000 in tax
certificates and something less than
$500, 00O, 600 in loan certificates.
Whatever method congress may fix
on for meeting these payments treas
.nry department officials are insistent
that only personal economy on the
part of the people at large. consistent
operation of leading industries. and
conservative banking bethods will
enable the country to come up to the
mark. =
r. C. Lefingwell, assistant secre-
tary of the treasury in charge of fis-
cal bureaus Is the official most direct
ly concerned with this part of the
future financial program, and his po-
sition is that the country is a sound
condition IF-and he capitalizes the
word-if 1t attends to business.
A Industrious man in good health
has no trouble paying his debts II he
works regularly and saves his money.
IL he spends money as fast or a
little faster than he makes 1t there
is going to be trouble on the day of
reckoning.
ITO meet the problem of the mex
three years the most rigid economy
in governmental expenditure should be
enforced, adequate revenue from taxes
should be provided and rigorous sal
methods adopted with a view to
the rapid retirement of the floating
debt and of a portion of the victory
loan before maturity. If due progress
is thus made in reducing the floating
debt, Victory notes should be accept
at par in payment of the five in
and profits tax installmentS fall
due in the calendar year 1922 and
the first quarter of the calendar year
1928; or IL the notes are then selling
at or above pan a portion of them
be called for redemption in
and December 1922. This would
raise the level of all other govern
securities and make possible the
of the reduced balance of
III victory loan OF terms advantage
Gus to the government.
These measures are feasible and
necessary II, however. we reduce
taxes, increase expenditures and delay
operations, the governments
financial predicament will be grave,
for the debt outstanding and maturing
three years amounts to $4,000
600. 000."
A special meeting of bankers was
held in Washington recently at the
call Of Governor Harding. of the fed
eral reserve Doard. and II was agreed
loans should be restricted to es-
Industries and every legitimate
means taken to reduce imitation. 1t
is the contention of the governments
financial experts that unhealthy slim
commercial business has been
proceeding unchecked.
From march. 1919. to March 1920,
though holdings of and oans on, gov
eminent war securities in some 500
member banks of the Federal Reserve
decreased from $4,000, 900. 900
to something over $4,000. 900 900;
other loans and investments increas-
ed from 1000. 0O0. 900 to more han
$14, 600, 600, 900. For every dollar of
credit released by the government two
were extorted by business.
High rates of interest and discount,
limitations of currency and credit. and
other traditional methods of nance
control should be used courageously,
in the opinion of Secretary Letting
well, but even these Will hardly suffice
under the abnormal conditions now
and the real solution must
lie In producing more and consuming
less.