The New York herald., 1921-03-03

Speoal cable 20 THE NEW YORK HERALD
Copyright, 1871, bv THE NEW YORK HERALD
New York Herald Bureau.
Paris, March 2.
The announcement from Italy that the
current budget deficits have been reduced
at least 10 per cent. by the passage or
the new bread law bears out all the pre-
dictions of American financiers who have
visited the country during the last rev
months, that Italy will be the first hu-
ropean Power to stabilize her financial
affairs as we'll as social life, despite the
constant efforts OF Communists to pro-
woke trouble
TIE New YORK HERALD correspondent
learned that the French are studying
Rome's policy closely with the view OF
taking a leaf from the Italian BOOK IL tne
result Is as successful as the optimlstic
reports indicate, although some hnanciai
circles here fear that the prophecies OF
an enormous reduction in the budget are
premature.
Earlier dispatches indicated that ule
whole Italian budget would oe reduceu
more than two-thirds. but q messase
10 the Italian Embassy insists that the
massage OF Premier Glolitti's Midas
bread law becoming effective to-day
merely tends to reduce the deficit ana
not the total from 10, 600, 100000 lire TO
about 1000, 100000 lire.
The text of the Law Is not let avail
able here. but the genera lines OF the
measure. which obtained the unanimous
approval OF the Italian Senate after Dit
ter opposition in the Chamber was
finally overcome, involve the raising OF
the retail price of bread to about douoie
the present price.
- ,ygf ftfTthNy
troubles" the Italian Embassy told The
NEW York HERALD correspondent AS
in all other Italian efforts 10 increase
the nations revenue the increase IS nor
to be applied to the poorer classes put
the entire 5000 100000 lire are TO De
obtained from those whose means read-
ily permit OF IT, II Is the opinion OF tne
Italian Government that the new law IS
the greatest experiment In social de-
mocracy ever attempted. The fact tilal
it has already. won favorable comment
from the radical elements points 10 It's
ultimate success.
Compared with Frances constantly
increasing budgetary deficit now esti-
mated at almost $4,000 100000 francs,
the italian record undoubtedly gives OPP
portunity for a revision of all accepted
economic theories Italy's first post wa
budget OF $4,000, 100000 lire was only
reduced by 1000. 100000 during the
succeeding year when the Government
decided not to take into consideration
any reparations or indemnities which
might be received later from Germany
or the Austrian Empire.
Italy unlike France" the same au-
thority told the correspondent for THE
NEW YORK HERALD, decided that the
prospect was too hazy to be relied upon
IL n prompt economic and financial res
toration was to be brought about. Ac-
cordingly the indirect tax receipts were
increased. especially on articles destined
for the wealthier classes. When it was
found that bread was being sold at less
than the cost OF the grain used in its
manufacture II was decided to apply the
same principle with special provisions
which will exempt the poorer laboring
classes from the additional burden
With a deficit of only 1900. 900. 900
lire and the possibility of q portion of
this being obtained from Germany dur
ing the next few years. 1t must be ad-
mitted that Italy is further on the way
to recovery than any Of tho belligerent
nations as a direct fruit of tho most
energetic fiscal policy vet devised in
Europe