Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1922-03-13
TREASURY HEAD
SAYS PROPOSAL
ME:NACESCRED|T
OF COVE RNNENT
"It Is Both Dangerous and
UnWise" to Avoid the Cost
for The Time Being; Ford
ney Informed.
SHOULD BE PAID FOR
EACH YEAR, ASSERTS
Bill Makes No Provision
Whatever for a Sinking
Fund, Amortization or
ANY Other Reserves.
lE, The Associated Press.

Washington, March r.
The new soldiers bonus bill,
as drawn by house repub-
licans, was attacked tonight
by Secretary Mellon as in
volving a dangerous abuse
of government credits"
Replying to a request for
the treasury's comment on
the new bonus bill, Mr..
Mellon in a letter to Chair
man Fordney of the house
ways and means commit
tee, made public tonight
by the treasury, sharply
criticised the features of the
proposed measure provid-
ing for loans by banks upon
adjusted service certificates
as indirect and forced"
borrowing by the govern
ment. He suggested that
the direct and regular
way" to provide for a paid
up endowment insurance
feature would be to issue
certificates with provision
.for direct policy loans to
be financed by the govern
ment. Mr.. Mellon contend
ed that "it is both danger
Gus and unwise" to attempt
to avoid the cost Of the
bonus for the time being.
Can't Avoid Burden.
There is no way" he said, "by
which the American taxpayers can
avoid the burden, and If the bonus
is to be imposed it is far better for
all concerned that it be placed upon
a definite basis and paid for each
year out of current revenues. To
do this at this time will necessari-
ly mean the imposition of addi-
tional taxes on the public
The secretary estimated the cost
of the bonus under the bill consid-
ering each Of the possible choices
offered to veterans, at more than
$1,000, 100000 by January l. 1926.
Whatever form the bonus measure
might take. he asserted, would
mean a cost to the government of
from 100000, 900 to 100000 coo
for the next three or four years
and possible liabilities thereafter
of more than 5000, 100000 a year
until 1943.
Statistical Tables.
Accompanying his letter, Mr.,
Mellon transmitted statistical ta-
bles prepared by the treasury ex-
perts showing the varying cost of
a bonus according to what per-
centage of veterans might choose
the different plans of payment CT
fered.
Mr.. Mellon called attention to
the fact that the bill makes no
provision for raising additional
revenue to meet the cost of the
bonus, and recalled to Mr.. Ford
UtNt IIdI ulH6 . lttttI VI
February 16 in which it was sug-
gested that a general sales tax bo
enacted to provide the necessary
funds, or the bonus legislation be
postponed. Secretary Melons
letter, in part, follows:
1.-THE bill makes no provision
whatever for sinking fund, amorti-
zation or other reserves against
either the liability that would be
thrown upon the government in
1925, or against the liability on the
certificates at the end of 20 years,
nor does it make any provision for
the payments which would accrue
in ordinary course from year to
year on account of the death of
veterans.
Cost to Government.
"The direct cost to the govern
ment of a bill carrying these pro-
visions for about 100000 ex-
service men is almost impossible
4 ~