Evening star., 1928-06-12

lord, director Of the budget before tn
business meeting of the Government
last night follows:
Mr.. President and members of tn
business organization of the Govern
nient:
s November II next will mark tn
antervention of 10 full years since tn
rations of the world ended the struggl
for physical mastery and entered upol
1ne no less real and bitter fight 70
recovery from the devastating effects o
war The struggle for recovery in thi
cour try--~the fight for return to norma
conditions of busineSS-is a gloriou
record of patriotic effort, of wise ad
t1inistration. and r.. ais a faith in on
Government and ;te ideals that is re
assuring of the stal' and soundneS
OF the Republic. Figures are. not il
themselves interesting, but nothing 81
eloouently and convincingly tells th'
wonderful story of our countrvs re-
naarkahle transform alton from the dc
etructive ways of war to the constructive
pursuit of peace as the silent marcl
Of its expenditure and surplus figure!
across the pages of history.
The March of Billions.
In 1917. the year of our entry into
the World War. we spent Sl977. .681. :.
55o.52. Of which 1885. 100000 were FOL
foreign loans And then how the ex.
penditure climbed. as we threw the flii
weight of our resources of men anc
munitions into the conflict and mar
shaled the Nations billions to make the
world safe for democracy. In 1918. the
FIRST full year of war. expenditure jump
ed by $4,000, 900 .000 up to Si2.697.-
S36, ,705.62. The next year-19l9-we
called out more of our reserves and
made an offering to the cause o1
slS,522. .894. 7o5.03. That was the year
we we're paying for the war. settling ouI
debts and closing out our war contracts
The task was herculean. but we ac-
complished it, We raised the money
We paid the bills.
In certain localities it is the custom
to refer TO the year of the big snow OF
the year Of the great flood or to a year
marked by some other unusual happen
ing I think our Treasury will always
refer TO I,9I9 as the year of the big
debt and pig deficit. We ended that
year with q deficit of $l3,370, ,637, ,568 60
while on August p of that year the
public debt tot- $26. .596. 70l .648.0l
As these tremenoNus totals OF deficit and
debt almost inconnprehensible in theiI
naagnitude, parade their astounding fig
US before us we revert with interest
and profit to the dark days following the
American Revolution when the infant
republic contemplated with dismay an
extraordinary debt Of S54 100000
But the courageous. hopeful. fight
hlg spirit that animated the founding
Fathers was not lacking in 1919. In the
attack on that colossal debt Congress
Fred the first gun with the cumulative
sinking fund act. which said 10 the
country and TO the world: No matter
what happens. no matter what the de-
illand for expenditures. no matter what
the need, each year we will make an in
creasing contribution 10 debt reduction
Since its enactment in 1919. up to and
Including 1927. that wise Law has cut
&. .o74 .oS0, $50 from The debt.
4 And out Of the grim shadow of that
crushing debt and discoUraging deficit
came a gleam of light with a surplus In
1920 Of s2I2,475, 5,197.67, which warranted
relief TO the people In the form Of tax
reduction. The year 1921 gave us a
surplus Of $86. .723,77l.6l and gave Us
tsae budget system. From August 81
1919. date Of It's peak to June 30. 1921
fire debt had been reduced by $3.50
2S1 .0e5 At. There still remained. how.
ever. when the budget entered the field
4 portentous balance Of S24, ,00o, ,0o0, 900
GsFnsnding annual tribute In interest oi
1850 .G00, 900. Some one remarked to
kr. Winston Churchill:
nsbs.
at know replied the chancellor.
We've got 10 budget
That's what We had TO do With ouY
great inert debt-we had 70 budget, and
NE budsed ii.
Enter the Budget System.
"And thus ne come by easy grada.
tong TO the budget and the policy 81
constructive economy Of which IL wal
Ire foregunner. There Is no intention
tr this discussion Of operations undeI
budget control To convey the thought
tigat economy was unknown In the Fed.
eTal Government prior TO the advent
ol the budget system. Before thai
tssne no agency was existent equipped
and available for carrying out polio,
Of Federal retrenchment--to attack ths
problem Of waste as whole and appl,
az effective remedy.
When the budget made its appear
enee in June. 1921. appropriations hat
eil been made for 1922. The operating
program carefully prepared by Gov
eynnaent agencies contemplated an ex.
pep1it1re ~ $3.50 600. .O00--an amolin
knst must hare made the TreasuFl
weep with apprehension. The n1one1
was available. We had IT. IT couIe
have been spent. without interferenc.
= void haze been spent. Enter tn.
budget and the budget idea--a principi,
airnost a. old as the eternal hills, but q
sRHgsre8sRf Ersrasap~g 9nr
Government That ~ 500 600 600 va
PIT through reducing process. II wa
Epked ard punched and pushed sb0u
Ard pared and ptglned, and 3755, 900
900 sqg5eeze6 out Of IT, And the yori
OF controlling Federal spending was on
We ended that year with a surplus O.
fSi1yE0i ,6Si 10 In place of the defici
ts7at would have been insured by tina
aDerd3ng program of $3.50 900 900. Ti,
NJ yfSF We nearly eei3aie6 that recOre
WIN q net balance oyer expenditure O.
500 gG57 .lGG.z9, III 1874 prior year
we're ogersbzdoWed with a surplus In ri.
eess of a half billion dollars Ia the in
tsFeSt of accuracy, f505s 800 1851. An
Nefler tar reduction was rewarded witt
q surplus In 1925 " quarter Of :
billion again. In the interest of ezacti
tilde, $3.50 y505.z5sz2. We BY this tim.
Rae acquired ta3e habit ~ 6egl93nsEraf
ssgg sJrDlsiseg 70 We eggdad 1923 with !
generous surplus of sz77. .7e7, 7,3is "a, ,gf1icf
was The prelude for another iaz Tedue
ten Last year, 1877 VIE fairly outdl,
ourselves with Il surplus blg enough u
: ~ Rlyen its fuii proportion Of 1896.
E93 .s2i 10. Of this splendid tyszl 1912
g51.559 wss applied ~ tsJe pgbise debt
fSaereoy saving in interest "a 900 900
FNaF.
While plo&t Gf ths war involved ma
tscns are struggling Sitf9 deficits, w
bare teen fagoref foY eight eorseelJtty,
years with aB annual surplus Prom
aS1g ~ 1927 the surplus total aEpyinfet
W 12sf91 Go9998. Cf tigiz 81 2s2 900 O9l
acnr&e6 during the budget DeFsfd Jun
~ neKt we ezEees this surplus DJtai vii
gea<k1 ~ o09 6a0 mo Without firm ron
fyeI % spending and HnFennif1sng car