Norwich bulletin., 1921-03-09
Official Statement
 of Sec'yof Treasury
Mir. Mellon Urges Budget Sys- tem-For Rigid Economy in Governmental Expendi- lures.

Washington, March s.-Secretary Mel lon of the treasury. in his first ohlciai statement, made public tonight in the form of a letter to bankers,O appealed to the people generally to stand. for rigid economy. in4 governmental, expenditures" and. urged the immediate establishment of a national budget system. The new treasury secretary in his let ter discussed at length the nations fnan- cial condition, declaring that the showing made in the last eight | months had been particularly encourag l ing. There are, however, heavy drains | to come on the treasury this month and next he said. and these requier the float ation of more short term certificates of l made coincident with the letter to the | bankers.
 "The nation cannot afford extrava-
 gance" Mr. Mellon asserted, land so far ] as possible it, must avoid. entering new fields of expenditures. Figures on cur
 rent operations of the government show
 that the country's finances are sound but
 that the situation calls for the utmost | economy. -'
 '"The heavy requirements of the gov
 ernment on account of necessary expen-
 ditures, including interest and sinking | fund on the. public debt, and the ma
 turity of $7,5oo.0oe.000 in short dated
 debt sin the next two years or thereabouts
 make it imperative that the greatest care
 and economy be exercises in matters -af- fecting government expenditures.
 The people generally must become
 more interested in saving the govern
 ment's money than in spending 1t. 4 thorough going national budget system must be established and the government.
 expenses brought into relation to its in
 come" ft The belief is expressed by the new sec retary. however, that the first min, months of the fiscal year, or to Marcf
 31, would show the treasury had mad, ends meet with slight surplus to ust against the great war debt. Payments ol |, the war debt must necessarily be slow. h said. explaining that the heavy payment I to the railroads would seriously hampe previous plans to lower the debt
 |, The issue of certificates announced will [ aggregate $4o0.ooO, Oeo and will bear in ? terest at 5 1-2 per cent. half having maturiay date of one year and the othe
 for six months. Both issues will be ac : cepted in payment of income and profit {, 1 taxes. t'-t '.--.i '-'
 2 In.notifying the bankers of the issue. MT. Mellon said he felt it his duty t ( inform them at the outset of his ad : ninistration of the probable requirement l. of the government in the coming month T and to say something concerning it. t financial programme He said that $500 eeo,0e0 in certificates must be paid o - March Is and an additional SIS, S,000, 90 | month later. Besides these need
 there is to- be paid the seni-annual ir
 terest on Liberty bonds -cn March 15.
 payment. of about SIS, ,000, ,o00. Tn B treasury also must make payments
 the railroads during March. which NJ n Mellon estimated at &20e e000, 900.
 l. sTo partially offset the heavy outgo, tt IS regular quarterly payment of incon n and profits taxes is due March 15 froi e which the treasury hopes to realize ay tt proximately $500 ,0oo. 600. This tax pa, 1T ment, thereforF. will be used up in r,
 tiring -the certificates due On the sam 1t date. Funds obtained from the new issr l. Of certificates then will become availab e- for caring for other debts of which tt
 railroad payments and the small, previol
 isues of certificates constitute the grea
 est amount.
 N MT. Mellon also observed optimiet
 signs in the general financial conditic "a throughout the country, noting partic, larly that the vast quantities of goverl s+ rnent securities were widely spread ar "a that each new issue of government pap
 was being taken more largely by il !. vestors. He cited. market quotations { |. treasury certificates showing that tn, S , had been quoted at par or at a premiu z as an indication of healthy and sou1 - finance. Those now held by banks N treasury records showing that many fl ancial institutions were heavy holders A are being gradually absorbed by real
 vestors," MT. Mellon said, adding tn
 the situation generally as regards to loa
 required by the government was much il ID proved over conditions a few months as