The New York herald., 1920-12-24
HOUSTON SAYS us.
CAN'T STAND NEW
MONEY BURDENS
German Credit, War Bonus
and Tariff on Farm
Products Opposed.
HIGHER TAXES ANYHOW
Sees Revenue Sources Dry
Up, Deficit Grow and
Danger OF Initiation.
EUROPE SLOW IN PAYING
Intimates Wilson VIII Veto
Bill for Revival of War
Finance Corporation.
HIGHER TAXES ANYHOW
EUROPE SLOW IN PAYING
Special Despatch to THE NEw YORK HERALD
New York Herald Bureau,

| Special Despatch to THE NEW York HrRALp.
New York Herald Bureau,
Washington, ID. C., Dec. 23.
Pronounced opposition to the credit
of $1,000,000 900 to Germany, to the
81 ,000, ,000 900 bonus to ex-service men
in the world war, TO revival of the
War Finance Corporation already au-
thorized by Congress and TO passage
by the Senate Of the House measure
putting one year high tariff on farm
products was voiced to the Senate
Finance Committee to-day by Secre-
tary of the Treasury Houston.
The immediate effect of his state
nents against the resumption of the
activities OF the War Finance Corpo-
ration, now up to the President for
approval or veto was to remove any
doubt about an Executive disapproval
of that measure. Mr.. Houston did not
say so in SO many words, but Senator'S
who heard him, said afterward that
they regard II as positive assurance
that the Secretary knows what will be
done, and disclosed 1t at the hearing.
Primarily the Secretary had been sum-
moned to give his views on the advisa-
bllity of Senate action on the House op-
tional bonus bill. He did not discuss 1t
at length and will be recalled for that
purpose next Monday. At the same time
he said he was opposed to any sugges-
tions made involving further extension of
Government credit. or the addition OF
further Government obligations and the
consequent imposition of higher taxes.
Even without further authorization of
appropriations, he said. higher taxes may
be necessary. as revenue sources are
drying up"
Benefit to Big Business.
The Secretary repeated many argu-
ments he already had used against credit
extensions and revival of the War FL
nance Corporation, and said again this
so-called measure of relief to agriculture
would not result in opening foreign mar
kets, that large commercial concerns
like the International Harvester Com
.the Bethlehem Steel Company would
DeneNI from operations lhT lIlOTS lildH
would agricultural concerns.
Discounting the idea that foreign mar
kets would be opened to our products by
the War Finance Corporation. he said If
that happened at all ii could be done by
private concerns and the Government by
entering the field interfered with pri-
vate enterprise and initiative.
when our total Imports of agricul-
! tural products last year were approx
mately $500. 100000 and our total ex-
ports $4,000. .oOo.O .Ooo." said Secretary
Houston. 'it seems to me 1t would be a
dangerous game to shut off imports
when our exports to the same countries
are about three times as great.
1T all gets back to the same thing,
whether you propose the War Finance
Corporation, or the bonus bill. or extern
sion Of credit to Germany. or other addi-
| tional burdens. Whatever scheme you
devise you run counter to the proposition
that YOU cannot lift the nation by its
bootstraps
stfIi s1O,OOO,OOO,OOO Owed us.
"If you attempt to finance by borrow
| ing you tend to initiation. you impair pr-
vate enterprise. II you try it by in
creased taxes you add to already heavy
burdens and increase the cost of living"
DO you refer TO the bonus bill?"
asked Senator Watson.
They all come TO the same thing"
answered the Secretary. Congress will
have hard time. when It comes to tax
revision, TO maintain our needed revenues,
because OF decreasing incomes from
business. 1t will be difficult TO reduce
department expenses The largest cuts
could be made in the Army and Navy.
provided you gentlemen wish TO have a
different Army and Navy from those
now projected"
I'VE have been negotiating with for.
eign countries" he said. with q view
TO future reduction OF principal and in
terest on their debts to us. amounting IN
round figures 10 Sf0.0Vc. 0c0, 900. These
negotiations have not been satisfactory
have not been concluded as hoped thev
would be. and am not able TO say when
they will be.
by the end OF the next fiscal year
we viii have a gross deficit of $4,000
100000. Sources OF income from excess
profits and income taxes are drying ip
as shown by our records. Treasury estl
mates for the current quarter have now
been exceeded. These are all conditions
that must be carefully. considered by
Congress, especially when proposals are
pending for mourning new obligations"
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