Evening star., 1922-04-19
TREASURY DEFICIT
NEXT FISCAL YEAR
T0BE HALF BILLION
Country Now in Worse Finan-
ciaI Jam Than Any Time
Since War.
BY DAVID LAWRENCE.

Government finances are in the
worst jam they have been in since the
war. Secretary Mellon estimates the
ginning July next at nearly a half
billion dollars. Congress is on the
verge of passing a soldiers compen-
sstion bill, as well as other measures
for rivers and harbors. Nobody
knows how much higher the deficit
may go. though officials estimate
that If the soldier bonus bill should
may reach a billion dollars
President Harding is deeply con-
cerned over the situation. He may
read a special message to Congress
in an effort not only to secure greater
economy on existing appropriation
bills. but. to head off the soldier
bonus The action of the Senate re-
publican caucus in voting to have a
soldier bonus bill passed at this ses-
sion precipitates the issue. No spe-
cific bill was advocated by the caucus.
and the resolution can be Interpreted.
if the republicans choose, as a vote
in favor of a bonus bill with other
forms of compensation besides cash
or borrowing, such as land grants,
vocational aid. etc. The group in the
Senate which favors the House bill
will not let that be the Interpretation
without vigorous fight.
May Address Senate.
Before the climax comes, however.
several developments may be looked
for, among them a reiteration of the
governments financial situation in an
address by the President to the Sem
ate. Mr. Harding knows that if the
House bill were to come to a vote to-
day it would be passed by an over
whelming majority. The swing in
sentiment in the Senate toward pas
sage of bonus bill with money In it
for the service men has been grad
ual Talk of burying the bill in the
Senate has been swept aside by the
activity Of the bonus adherents, who
threaten to jam the whole legisla-
tive program unless they get a vote
on the bonus. Once the measure is
will dare to go on record against 1t.
Under these circumstances, Mr..
Harding's only chance to prevent the
passage of a House bill or any other
measure which further drains the
Treasury lies in a message setting
ly. 1t is feared this may injure the
chances Of the republican majority
in the coming elections, because Mr..
Harding will have to state publicly
that the administration faces a half
billion dollar deficit, and that the
economy program started out so au-
spicisusly with Director Dawes has
failed to balance the budget of 1928.
Mr.. Mellon, however, has already
disclosed the painful facts, so that
from a political viewpoint Mr.. Hard
ing will not be able to erase the inn
preston thus far made oy the an
nouncement of a nalf-biliton- dollar
deficit. But then, unless Mr.. Harding
is able to exercise further control
over his party in the Senate. the
chances are the deficit for 1928 will
grow larger. So the executive is
compelled by circumstances to call
q halt toward further expenditure.
In many respects the fight that is
in prospect looks as II it will bring
the turning point In the Harding ad-
ministration. The President has not
given vent to his feelings over the
continued indifference of Congress to
his expressed wishes. He and his
cabinet had to hght hard to overthrow
a naval committees Recommendation
in the House last week, and the ex-
ecutive is being encouraged to use his
influence even further to secure COM
gressional ~acquiescence, in his view
point,
Curiously enough most, members of
Congress- expect Mr.. Harding to sur
render to them on the bonus issue. and
they insist that deficit or no deficit,
he viii have to sign the bonus bill or
see tt passed by a two-thffds vote
Ss,,,,.,,hi 1000 !,