The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1923-01-01
u. s. MUST FACE
VAST DEBTS
Mellon Plans TO Meet Out
standing Bonds With New
lssues-Debt Is Cut.
By w. III. ATKINS.
international News Service.

Uncle Sam started the new year
today facing some gigantic financial
problems.
Nearly 81, 500, 900 900 of public OBJ
legations, now outstanding, mature
within the next six months, and
must be refunded by the Treasury
Department. Besides there will be
the uphill struggle in keeping ex-
penditures for ordinary purposes
within the bounds of ordinary re-
ceipts.
Secretary Mellon believes still
more rigid economy in government
spending will be necessary, and a
vigorous drive must be made to
gather in new revenues from hidden
sources, which are held to be col
lectible under the revenue laws.
The Treasury began the New
Year by paying off $626, OOO,OOO OF
1918 war savings certificates which
matured today. The larger share
Of these obligations were refunded
into obligations of the same gen.
eral character.
Through special arrangements of
the Treasury maturing war savings
securities were exchanged for new
issues of Treasury savings cert1f1-
Gates. which are considered even
more attractive as an investment.
Billion Paid Off.
The Governments financial sheet
was wiped clean of more than
81 900, OOO, 900 in public debt in the
first six months of the year ending
December 81.
New refunding between now and
June 80 next will include redemp-
ton of asury certificates
amounting to $3.50, 100000, maturing
March Is next, and $273,OOO,OOO OF
certificates maturing June 10. On
May 20 the remaining $9O5,OOO,OOO
of AZ per cent Victory notes out
standing will mature.
Both issues Of Treasury certif1-
Gates will be covered fully by reVe-
nues expected from income tax pay
ments in the first two quarters OF
1928.
Secretary Melons plan is to
meet the maturities which remain
through further issues of refundlng
securities, on terms adjusted 10
the condition of the Treasury, and
of the money market at the time
the program is launched.
Secretary Mellon emphasizes the
fact that successful development OF
the Treasury program will depend
upon the maintenance or souno
Government financial policy con-
corning expenses. Congress will be
urged by the Administration to re-
frain from needless expenditures
that would entail heavier burden
upon the Government, and render
it impossible to meet expenditures
with ordinorv TncofnfG
Avoids Long Time Debt.
Treasury experts said today that
the Government, by gradual retire
ment of the war debt is distr1but-
ing the debt over early maturities
in amounts not too large to be
financed each year. The Treasury
thus has attained good control over
the public debt, and carefully avoid
ed perpetuation of the debt py
issuing long time obligations in its
refunding operations.
Secretary Mellon has assured
President Harding that considerable
economy will be achieved this year
in public expenditures through re-
auctions in allowances to depart
ments and through expected larger
revenues from back tax collections.
Commissioner Blair's record by the
end of March is expected to show a
return to the Treasury of nearly
.$400, 900, 900 in back taxes for the
fiscal year 1t is the Treasury's
purpose also to realize larger reve-
nues through sales Of the Govern
ment's investment in war emergency
corporations and further sales or col
lections of railroad bonds and other
classes of securities.