The New York herald., 1922-05-23
U. S. WILL BORROW
while BONUS WAITS
Government Must Raise Ap-
proximately $465, 100000
Before June Is.
TO MEET ITS NOTES
Maturing Obligations In
clude Victory Issue and
Liberty Bond Interest.
RAID BILL STILL SLEEPS
Senate Finance Committee
Takes No Action to Hasten
Decision.
BY LOUIS sEIBoLD.


The Treasury Department admins
the bonus raid on the public Treas
ury to-day to add to existing compn-
cations.
While Senatorial supporters of the
scheme were trying to decide on the
next move the financial department OF
the Government was preparing to add
very interesting development to the
situation
The effect of it should be to con-
vince bonus agitators that there is
nues to finance TIE s5,000,O0O,O00 un-
dertaking. Within a few days the
Treasury will announce it's plan for
the heaviest financing forced on the
Government since the war to meet
maturing obligations.
Must Go Into the Market.
| The condition of the Government
finances. which renders it imperative
that the Treasury go into the money
market to borrow funds to conduct
studpendous Government operations,
was cited by officials this afternoon as
an additional reason for putting a stop
TO the bonus raid without further bick-
ering.
Government plans for raising money
to meet it's obligations will show that
the Treasury will have to raise $775,-
100000 to pay bMs maturing on June
15. AS against this total the Treasury
expects to collect in revenue from in
come taxes about 1910. 100000.
This means that the Government
Tiust borrow approximately s465,000.-
600 before that date. Ne details as to
the method for borrowing this sum of
money were available to-day, but
Treasury officials said that feasible
plan would be worked out within the
next week.
The maturing obligations which the
Treasury must finance from income
tax receipts and on borrowed money
includes s3S0,000,000 Treasury GER
tificates of indebtedness, $270,000, 900
CT Victory 3A per cent. notes and
100000 for interest due on the
First and Second Liberty bond issues.
1t is probable that the Treasury will
be put i'm the position of redeeming a
large block of the Victory notes before
June 15. While the Victory notes were
called for redemption on that date,
Secretary Mellon announced the
Treasury is prepared to redeem them
tefore that date, at the option of the
holders.
Needs Are More PressinE.
The Federal Reserve Board has been
advised that more than S100,000,000
Of the notes have been presented at
Federal Reserve banks for advance
redemption, under the terms of Secre-
tary Melons offer. Because of this
fact the Treasury's need for new funds
Will be more pressing than anticipated
few weeks ago and will force an
earlier decision by the Treasury of
how the situation thus created Is to
be met.
1t is not planned to use the general
fund of the Treasury to meet matur-
ing indebtedness. as this is imprac-
ticable because of the nature of the
assets of the fund. There is a net
balance in the general fund of $685.,
S0,S09, but the assets include 41,000,-
900 Of silver bullion, besides very
much larger amount of gold bullion.
No effort was made to take up the
bonus bill in the Senate to-day. Re-
publican leaders declared that none
would be made for the present" DEM
ocratic Senators. who are ambitious to
put the Republicans I'm a hole" by
compelling the latter TO take up the
bonus. have not finally decided on their
course of action. They will do so in
the next day or two.
Both Republican and Democratic
Senators agree that the bonus is
"closed incident" so far as President
Harding is concerned. They do not
believe he will add to or modify his
previous suggestion that bonus legis-
lation be abandoned for the present
unless financed with the sales tax.
Senators on both sides OF the aues-
ton agree that a sales tax would be
decisively beaten. Consequently it will
probably not be seriously proposed.