The Little River news., 1922-03-15
SEC. MELLON ASSAILS
 THE NEW BONUS BILL
Opposes It Even More Vigorously Than Its PredecesSOrS-COn
 demns Bank Loans.

Washington, March 12.-Assailing the new Republican soldier bonus bill as proposing Ca dangerous abuse of l the governments credit" Secretary of the Treasury Mellon, in letter to Chairman Fordney of the House Con- mittee on Ways and Means, asserts that the actual cash outlay by the government in the next three and a half years under the plan would be $1, 200, ,000000, or as much as the pro- bable cost of the original cash bonus scheme.
 The secretary of the treasury ex- presses more vigorous and sweeping disapproval of the latest bonus plan than any of it's predecessors. He un- sparingly condemns the bank loan feature winch he asserts would clog the country's financial machinery with frozen credits" producing in flation.
 Much wiser than this scheme, he says, would be the financing of the bonus by the issuance of bonds, and in any event if the bonus is to take the form of endowment insurance, it would be better for the government to loan directly to former soldiers on their certificates from the start.
 There is no way" concludes the shxy hio1, ho can taxpayer can avoid the burden, and if bonus is to be imposed it is far better for all concerned that it be placed on direct and definite basis and paid for each year out of cur rent revenue. To do this at the pres ent time will necessarily mean the imposition of additional taxes for the purpose"
 Fordney Not Impressed.
 MT. Fordney received the letter last night but declined to comment on it today. That his opinion of the prac- ticability and wisdom of the new plan has not been changed by the argu- ments of the secretary is indicated however, by the congressman's asser- tiOn that he expects the bill to be favorably reported without change to the committee. He said he would lay the Mellon letter before the commit tee for its information.
 In view of the avowed object of the new bill to spare the government any great expenditure in the next three years, one of the most surprising fea- lures of the Mellon letter is the asser- tion that it would cost immediately as much as the cash bonus plan. MT. Mellon estimates that if 70 per cent of the veterans choose the certificate plan, 23 per cent take farm and home aid, per cent selected vocational training and 2 per cent the land set Element the direct cost othe gov ernment during the fiscal year 1923 will be $2S9,954,OOO.
 l In the fiscal year 1924 the direct cost would be $216,340,O0O; in the fis- cal year 1925, $12S,013,OOO, and in the first half of the fiscal year 1926, $615,- SS2, ,OOO, or more than $1,200000, ,000 within three and a half years. These estimates are based on the assump- tion that half of those who take ccr- tilica.es will borrow from the banks and default on the loans, thus causing the banks to demand the money fror the government after October 1, 192! The total cost to the government fl the period of 20 years during whio the certificates run, under these inmates, would be $2,995, 1000, n including probably $1OOO00,O0O ado tional a year after 1923 if the la. settlement aid plan is developed. Tn ultimate cost is somewhat less tna members of the Ways and Means Con mittee had estimated Some have es timated that the ultimate cost migh he nearly $5,0G0,0O0,000.
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