Great Falls tribune., 1922-03-14
THE BONUS BILL

y GT74 % !
60 far as the lower house Of con-
- gress is concerned, the decision
is made to pass a soldiers bonus
bill that will cost the taxpayers
nothing, or next to nothing, At
present. Any soldier who has more
than $50 coming to him under this
adjusted compensation bill will be
given 4 certificate which says that
he has due him from Uncle Sam
a dollar a day for the time Of his
service If he was not sent abroad
and a dollar and quarter if he
was sent in foreign service. This,
in addition to the dollar day
which was the sum mentioned in
his enlistment contract. That would
make the total $z a day and board,
lodging, and clothes, for those who
did not 60 abroad and $2.2S for
those who did-not In excessive
sum if you concede that the en-
listed citizen is entitled to the eco
nomic value Of his time when called
to the defense Of his country.
Not all the ex-service men will
take advantage Of this cash offer.
If they did, it would cost several
billions of dollars to pay them.
There are other options they may
choose, and these in the end will
cost the taxpayers still more money,
but the payment will be postponed
many years in some cases, especial
ly if they select the insurance op-
tion. It. is all guess work as to
what the soldiers bonus bill will
cost the taxpayer in the end because
no one knows what one Of the four
options he is offered will be select
ca, but it will be a vast sum in any
event, some say four billions and
some say five, and some less than
either of these figures.
II But the house bill does not pro-
pose to pay any cash bonuses at
present, except small ones where
the recipient was less than fifty
DAYS in the service and has less
than fifty day bonus due him. The
others will just get a certificate
from Uncle Sam saying that he has
certain sum due him. The bonus
law permits all federal and state
banks connected with the reserve
bank system to accept these eertifi-
Gates as security for loan up to
half their face value, provided the
bank loaning the money does not
charge interest at rate exceeding
two per cent in excess OF the ri
serve bank discount rate at the
time the loan is made. That rate
is likely to be somewhere between
four and five per cent during the
next three years, so that the maxi
mum interest charge the banks
could make on loans to the ex-
soldiers presenting such certificates
would be from to 7 per cent. The
bill further provides that If at the
end of three years the soldier who
gets such bank loan to the extent
Of so per cent Of his certificate has
not paid the bank principal or in
terest, the government will then
come forward and take the loan Oft !,
the banks hand, paying up all de-
linquent principal and interest, and
Settle with the ex-soldier later for
the balance.
These bank loans are not man
datory. They are purely voluntary
as far as the banks are concerned.
Except where the ex-soldier is al
ready indebted to bank, or his
parents or relatives are 50 indebted
and he is willing to pay the amount
loaned back into the bank to liqui-
date previous Indebtedness, we be-
lieve that no banks in this part OF
the country at least, would look
with favor on such loans. To be-
gin with, most Of them are carrying
all the long time loans they can
afford to carry. To tie up depos-
itors' money for a term OF years
where they cannot get it back If
the depositor asks for his money,
will not appeal to them as good
banking business at this time when
they are carrying farmers paper
that needs to be nursed along tor
several years, in some cases, If they
are to collect the loans without
loss. Most banks have more or
less such frozen" loans on their
books and wish they had fewer OF
them. ...... ............
The banks do not need the warn
ing of the comptroller Of the cur
rency that he would not approve OF
IL