The New York herald., 1922-03-05
Continued from First Page.

tee, however, failed to reveal any sub
stantial reasons for this confidence.
The members interrogated admitted
they had not consulted President Har-
ding, Secretary Mellon or the leaders
of the Senate. The basis for their OPP
timism that the scheme which they
have indorsed as the ultimate attempt
tc finance the bonus raid is their as
sertion that by putting off the bonus
payments for three years they will
comply with the suggestion of the
President that bonus legislation ''be
postponed if the sales tax provision
is not acceptable.
Regardless of any ulterior reasons
that may lie back of the only expla-
nations obtainable there is little ques-
ton that Mr.. Fordney and his Repub-
lican associates are determined to put
through the insurance certificate loan
scheme. 1t represents the "best that
can be done"
If it fails one guess is as good as
another as to what is going to happen.
The bonus leaders themselves do not
know The most logical prediction is
that President Harding's suggestion
that all bonus legislation be postponed
will be adopted.
Meantime. Mr.. Fordney and his as
sociates are going ahead with their
last ditch scheme. They worked like
Trojans all day chiseling and pairing
the measure born of impulse and des-
peration, and which was described to-
night as "a rush of blood to the head
n cfpod pf an in Sniraf fiop -
Retroactive Feature.
To make the scheme as attractive
as possible the subcommittee perfect
ing the bill made several changes in
it. Out of the confusion of ideas from
which it was developed they are try
ing to evolve provision that is cer-
tain to provoke enthusiasm from
everybody that wants Government
cash for nothing.
This is to make the certificate loan
plan retroactive by extending its bene-
fits to the relatives of all soldiers who
have died since the armistice. 1t is
estimated that there are about $4,000
Of these. If the plan is adopted the
bonus bill will be swelled by many
millions of dollars. The supporters of
this idea argue that it will insure the
political support Of ''at least 100000
people,
Representative Hawley, chairman of
the subcommittee preparing the new
bill. confirmed previous reports con-
cerning the proposed plan and gave
the following explanation:
I'm the first place, as has been
stated. the adjusted service pay will
be on the basis of 81 per day for home
service and SIPS a day for foreign
service.
"The Secretary of the Treasury,
upon certification from the Secretary
of War or the Secretary of the Navy
will be directed to issue without cost
to the veteran designated therein an
adjusted service certificate Of value
equal to the adjusted service pay of
the veteran increased by 25 per cent,
known as adjusted service credit.
From October /, 1922, to October /,
1925, the holder of the certificate can
borrow from any national or State
bank or trust company so per cent. of
the face value of the certificate. The
borrower gives his note for the amount
of the loan, with interest at a rate
not more than per cent. above the
rate prevailing in the Federal Reserve
district in which the loan Is made.
Question OF Default.
Now if by any chance the soldier
defaults in his obligation and fails
to redeem the certificate within the
three year period then the Treasury
Department will be authorized to re-
deem the certificate and pay to the
soldier or his beneficiary the difference
between the amount he borrowed and
the accumulated interest, and the S5
per cent. face value of the certificate.
After October 1, 1928, he can bor-
row the adjusted service pay, plus 25
per cent. of the adjusted service credit,
plus the compound interest from the
date the certificate was issued, that is
October !, 1922.
THE certificates are nontransferable
and nonnegotiable. The banks cannot
sell the certificates or otherwise dis
pose of them during the three year
period when they are making the
loans. There will be provision in the
bill making them null and void II
found in the hands of any person or
institution other than the soldier him
self, his beneficiary. the banks in
question or the Treasury Department.
That provision was incorporated in
order to keep them from falling into
the hands of the pawnbrolxers or
usurers. IL the veteran holds the cer-
tificate until the end OF twenty years
it will be worth about three times it's
face value"
Mr.. Fordney and his associates con-
tented themselves to-day in expressing