Audubon Republican. [volume] (Audubon, Iowa) 1894-1925, 1920-12-23
WILL SAVE MONEY
FOR The PEOPLE
UNCLE TED TELLS THE Chill.
DREN THAT THE NEW PRES
IDENT WILL Do THINGS.

The children were gathered around
the fire for the storytelling hour be-
fore bedtime. Uncle Ted settled
himself in his easy chair, lighted his
, cigar, and invited Jack to suggest a
topic for the evenings talk.
This morning at school," said
Jack, "one of the boys told the teach
= er he had been reading what some
congressman and government Off
cials at Washington had been saying
about the need of taxes being kept
just as high as they are now, and
that if they are reduced at all the
treasury will not have enough mon
ey to pay its bills. He wanted to
know why, now that the war is over
it is necessary to have such big gov
eminent expenses. The teacher said
that one Of the reasons for the high
taxes was the need of paying interest
every year on Liberty bonds. / wish
you would tell us, Uncle Ted, why il
is that so much of our tax money has
to go to interest, and If there is not
some way of stopping those pay
ments and cutting down taxes that
much"
{ THAT is a pretty big question for
children of your age to understand, u
replied Uncle Ted, surprised that
Jack should want to know how the
government raises and spends its
money. But the matter of taxation
is one that affects all of us very
closely and the children in the
schools should have some idea, al
least, of the reasons for it. 1t is too
Z big subject for me to tell you ev.
erything about it tonight, so | will
4 Just talk to you about the Liberty
bonds and why it is we have to pay
so much interest upon them. Per,
haps some other night | will tell you
about other features of the tax prob
! lem.
'Of course you remember that dur
ing the war there were five Liberty
loan drives. Everybody was urged
to buy bonds until it hurts Mil
| lions of men, women, and children
took their money out of the savings
banks and bought Liberty bonds with
it. Some of the bonds have been
bought back by the treasury, but to.
day almost twenty-billion dollars
worth of them are still in the hands
of the people who bought them from
the original owners. Each year the
treasury is going to buy some of
these bonds back with money appro-
priated by congress, and as the
amount held by the. people grows
smaller of course the interest paid
by the government will grow less,
but at the present time it is about
100000, 900 a year. That is a ire
mendous sum and requires almost a
quarter of all the governments tax
money To pay, but there is a way that
it can be reduced more than half,
and that is what l want to tell you
about, so that you can explain it to
the other boys when you go TO school
tomorrow.
When congress passed the laws
directing the secretary of the treas
ury to raise money by the sale of
Liberty bonds, paragraph was in
cluded saying that he could lend
some of the money to the allies to
aid them is carrying on the war with
Germany. The secretary was told
that these loans must not exceed
$4,000, 100000, just about half OF
all the money the people paid into
the treasury for the bonds. Begin
ming with April 25th, 1917, the
treasury turned over millions of dol
lars almost every day to the repre-
sentatives Of the allied governments
stationed in Washington. Even as
recently al September 28th % this
year a payment of $40, 900 was
made 10 France, and the secretary
Gays that other payments are to be
made in the future. Altogether the
money the United States has loaned
foreign gOvernm cnts amounts to
, about 9,500,000,000.
Now, when that money was re-
ceived by the allies they gave re
: ceipt for 1t, called a promissory note
staring that interest on the loan, nj
the rate OF per cent every year
would be paid until the loan was re-
turned 20 the United States treasury
OF course if that interest were &C.
tually TO be paid IL would amount IN
about 100000 a year and conld
be applied by this government TO-
ward the payment OF more than half
the interest which has to be turned
over TO Liberty bond holders every
year. At first the interest was paid
by the foreign governments when 1t
b-came due and our treasury receiy.
ed about $437, 100000 in that way,
but in recent months practically
none of it has been forthcoming, and
on November 18th, 1920, there was
due from that source over 800, 0CO,-
$50. Moreover. there is no immed-
late prospect of the interest pay
ments being resumed or Of the back
interest being paid"
HI lpOw that whan NV father has