Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1922-03-13
MELLON LAUNCHES
ATTACK UPON NEW
BONUS MEASURE
Charges Bill Involves "A
Dangerous Abuse of Gov
ernment Credit
LOANS BY BANKS ARE
SHARPLY CRITICIZED
Suggests Insurance Certificates
With Provision for Direct
Advance on Policy.
WANTS FURTHER TAN AVOIDED
scrret"r! Of Treasury. in letter 10
Fordney. Asserts l.. =. Cnnnot
LOANS BY BANKS ARE
SHARPLY CRITICIZED
WANTS FURTHER TAN AVOIDED
secretary OF Treasury. in letter 10
Fordney. Asserts 4. =. Cannot
Financially! stand Hurd~p.
IA Agsocin,cd rressl

WASiiINGToN. March 1.-THE
new soldiers bonus bill as drawn by.
Republicans was attacked tonight
b. Secretary Mellon as involving ~
dangerous abuse OF governmen.
credit"
Replying to request for his COM
mcnt on the new bonus bill. Mr.. Mel
ION. in letter TO Chairman ForI-
acE. of the House Ways and Means
Committee. made public tonight by
;Ec Treasury. sharply criticized :ne
features Of the proposed measure
provihing for loans by banks upou
adjusted service certificates. as indI-
rect and forced borrowing by the
government. II suggested tha, The
'dircc, and regular way" to provide
for paid-up endowment Insurance
feature would be TO authorize insur-
ancc certificates with provision Cor
direct policy loans TO ha financed by.
tho government. Mr. Mellon con
tended that III is both dangerous and
unw!sc" TO attempt 10 avoid tho COS,
Hi the bonus io- the tim. being
Estimates Cost.
There is no WAY" he said. by.
avoid the burden. and II a bonus Is
To be imposed II is far better for all
concerned that II be placed upon a
direct and definite basis and paid for
each year out OF current revenues. To
do this at this time will necessarily
mean the imposition OF additional
taxes for the purpose
the secretary estimated the cost OF
the bonus under the bill. consider
ing each of the possible choices Of
Tered 10 veterans. at more than ST.
20o,060.000 by January !. 1926. Whit
ever form the bonus measure might
take. he asserted. would mean a co&t
10 the government Of from 100000
coo To ;:o0.Oo0.00O for tho next three
or four years, and possible contiru-
Ing liabilities thereafter of more
;han S20o.000,G00 year until 1919.
Accompanying his letter. Mr.. Mel
ION transmitted statistical tables
prepared hy Treasury experts SHOW :
ing the varying cost Of bonus ac-
cording 10 wl.at percentage Of vet
Grams might choose the dfcren;
plans Of payment offered.
Recalls Presidents Letter.
Mir. Mellon called attention 10 tac
fact that the bill makes no provisions
FOR raising additional revenue to
meet the cost OF the bonus and re-
called TO Mr.. Furdney President
iiardinGs letter OF February 16. in
which II was suggested that gen
cral sales tax bc enacted to provide
the necessary funds or the bonus leg
islation he postponed. Secretary Mel
Ions letter. in part. follows:
The bill makes TO provision what :
ever for sinking fund. amortization
or other reserves against either the
liability that would he thrown upon
the government in 1929, or against
the liability on the certificates at the
end of twenty years. nor does it mai.
any provision for the payments
which would accrue in ordinary
course from year TO year on accoun;
OF tho death OF veterans.
The direct cost TO the government
OF bill carrying these provisions
for about 4.5oo.oOo former service
continued on Page .. Col. CO.