The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1921-08-06
ECONOMY
To GUIDE !.
CONGRESS
Continued From First Page)
Incidental features until President
Harding returns.
MOndell Predicts .
$1,000, 100000 Cut in
Expenses Of y. S

Reductions of $4,000. 900 900 I'm Fed
eral expenditures in the immediate
future were forecast yesterday by
Republican Floor Leader Mondell,
who is waging a fight for heavy and
permanent tax reductions. His pro-
gram enlbodies the following:
Cut of $500, 900, 900 annuallys In the
ordinary expenses of the Government
for the fiscal years beginning July l..
1922, and July 1, 1923.
Elimination Of 100000 900 interest
on the foreign debt effective after the
Elimination of 1855 100000 on ac-
count Of railways. Shipping Board
and sundry claims effective after the
present calendar year. yt
Mr.. Mondell said his plan to reduce
taxes $500. 900. 900 below the estimate
of Secretary Mellon can be safely
carried through because, the country
I, is not entering a period OF advanc.
ing" but of rapidly decreasing" ex-
penditures. ~
Mr.. MondeIl thinks the excess prof.
its and higher income taxes could
/ be repealed Ss of January l.. i1s2l.
and the transportation and MUS
ance" taxes as Of January !. 1922.
II all are repealed to be effective
on the latter date no new taxes will
be necessary to replace them, but II
the excess profits and income taxes
go off as Of january 1, 1921. 1t will
be necessary to add either 5 per
cent fiat tax on corporations or raise
the rates on tobacco and cigarettes.
he believes.
Analyses Financial Situation.
Mr.. Mondell made, this analysis Of
the financial situation:
After a most careful considera-
ton of all probable items Of ex-
penditure. I I'm, of opinion that the
maximum of demands on the Treas
ury for the fiscal year, including
interest on the public debt. sinking
fund payments and postal expendi-
lures. Will not exceed $4,000, 900. 900.
From this total we may deduct $780,
000, 900 of postal revenues and vart-
our other returns to the Treasury,
/ including back taxes, salvage, sales
and miscellaneous income OF an
equal amount. or a total OF $1,000
; 100000. Deducting this from the
amount of expenditures, for all pur-
poses $500, 000, 900. -s,,.
1T might be less; II should not
be more and need not be more.
Assuming the sum OF SO, 500 900 900
as the requirement of the Treasury.
1t will be possible to reduce antici-
pated revenues under present laws in
the sum of approximately $500. 900 900.
The excess profits tax and the higher
ranges of income taxes produce nearly
that amount. They could be wiped
out and forgotten. In addition, the
so-called nuisance taxes and the trans
portation tax, in whole or in a very
large part, should be repealed as of
the date Of the enactment of the rev.
enue law or perhaps preferably as of
January l, 1922 To supply the funds lost
by these latter repeats 1t would be
necessary to have some other tax. An
additional per cent fiat tax on
corporations, to run one. year, has
been suggestedj possibly one other
tax, for instance, a tobacco and cigar
cite tax, yielding 500, 000, 900 might
be necessary.
Sees u. s. Outlay Decreasing.
LAS an alternative for this plan all
of the repeats suggested, excess prof
its, income surtaxes above IS per cent,
nuisance taxes, transportation taxes,
might be repealed as on January 1,
1922. in which event no substitute tax
of any kind will be required
I'VE should not lose sight of the
fact that we are about to revise our
tax laws, not in the face of an ad-
vancing but in the face of an antici-
pated rapidly decreasing national
outlay.
THE sum of $500, 900 900, which I
have estimated as the net outlay for
the fiscal year, includes Sass 200, 900 on
account of railways, 800, 000, 900 on &C
count of the Shipping Board. and
s100, 200, 900 estimated az expenditure
from various available funds to pay
war claims and obligations which will
not exist in the calendar year follow
ing the present one.
Looking still further forward to
the second calendar year from the
present, we ought to be able to antici-
pate a relief fsom the necessity of
paying for the current funds a large
portion of the $500. 1000, 900 of interest
on the debt owed us by foreign gov
ernments.
'In view of this fact. that the next
fiscal year should show a reduction
of much over $500. 000, 900 in expendi-
ture and the following fiscal year a
further reduction of nearly a like sum,
we may very properly reduce the tax
burden more heavily than we WOULD
be justified in doing IL we were look.
ing forward to an increase or even to
a maintenance of the present level of
expenditures"
At birth the pulse Of normal
H. &C. ..~t,