Evening star., 1928-12-04

ITO the Congress Of the United States:
States:
"No Congress of the United States
ever assembled. on surveying the state
of the Union, has met with more
pleasing prospect than that which ap
pears at the present time. In the
domestic field there is tranquility and
contentment harmonious relations be-
tween management and wage Garner.
freedom from industrial strife, and the
highest record of years of prosperity
In the foreign field there is peace, the
good will which comes from mutual
understanding. and the knowledge that
the problems which a short time ago
appeared so ominous are yielding tc
the touch of manifest friendship.
The great wealth created by ou.
enterprise and industry, and saved by
our economy has had the widest dis
trlbution among our own people, and
has gone out in a steady stream t.
serve the charity and the business O.
the world. The requirements of exis-
tence have passed beyond the standard
OF necessity into the region of luxury.
Enlarging production is consumed by
an increasing demand at home and an
expanding commerce abroad. Tho
country can regard the present with
with optimism
''The main srnre of these unexam-
pied blessings itss in the integrity and
character of tie American people.
They have hae great faith. which they
have supplemented with mighty works.
They have been able to put trust in
each other and trust in their Govern
ment. Their candor in dealing with
foreign governments has commanded
respect and confidence. Yet these re-
marsable powers would have been ex-
erted almost in vain without the con-
slant cooperation and careful admin
lStratlon OF the Federal Government.
we have been coming into a period
which may fe fairly characterized as
a conServat on of our national re-
sources " Rstefulness in public busi-
ness and E'1vate enterprise has been
Qlsplaced 0y constructive economy
inns mas been accomplished hy bring
ing our domestic and foreign relations
more and more under reign of law
"A rule of force has been giving wav to
a rule OF reason. We have substituted
Tor the vicious circle of increasing ex-
penditureS, increasing tax rates and
diminishing profits the charmed circle
oI DIMINISHING expenditures, diminish
ing tax rates and increasing profits
Many TaNm Reduced
And Some Are Abolished,
-Four times we have made drast;c
revision OF our internal revenue svsteno
eoonshlng many taxes and substantially
Ieouclng almost all others. Each tir1e
the resulting stimulation to business has
SO increased taxable incomes and nrof-
us VnaC surplus has been produced
one- & talIo OF the national debt has been
PAID: while much of. the other two
'IhiIoS mas neen refunded at lower rates.
and these savings of interest and con con-
slant economies have enabled us to re-
peat the satisfying process of more tax
reductions. Wa
Under this sound and healthful en-
couragen1ens the national income has
increased nearly so per cent, until it is
estimated to stand well o. aer $50 O00.-
100000. 1t has been nlathod which
as performed the seeming miracle of
IeaVlng much greater percentage of
earnings in the hands of the taxpayers
with scarcely any diminution of the
government revenue. That is con-
structIve economy in the highest degree.
It is the corner stone of prosueritvs II
should not fail to be continued.
This action began by the application
OF economy to public expenditure. If
II Is TO be permanent, it must be made
SO by the repeated application of econ
on1y. There Is no surplus on which to
base further tax revision at this time.
Last June the estimates showed
threatened deficit for the current fiscal
year OF $94,000,000. Under my direc-
ton the departments began saving all
they could out of their present appro-
priations. The last tax reduction
brought an encouraging improvement in
business, beginning early in October
which viii also increase our revenue
THE combination of economy and
good times now indicates a surplus of
about $4,000 000 This is a margin of
less than per cent on our expenditures
and makes it obvious that the Treasury
Is in no condition to undertake increases
in expenditures to be made before June
30. It is necessary, therefore, during
the present session to refrain from new
appropriations for immediate outlay, or
If such are absolutely required to pro-
vide for them by new revenue; other
wise we shall reach the end of the year
with the unthinkable result of an un-
balanced budget. For the first time
during my term of Office we face that
contingency. / am certain that the
Congress would not pass and I should
not feel warranted in approving legisIa-
ton which would involve us in that
financial disgrace
Federal Finances Declared
Most Satisfactory.
"On the whole the finances of the
Government are most satisfactory. Last
year the national debt was reduced
about $9o6, 100000 The refunding and
retirement of the second and third
Liberty loans have just been brought to
a successful conclusion, which will save
about $75,000,000 a year in interest.
The unpaid balance has been arranged
in maturities convenient for carrying
out our permanent debt-paying program.
The enormous savings made haze
not been at the expense Of any legiti-
mate public need. The Government
plant has been kept up and many i'm
provements are under way while its
service is fully manned and the gen
eral efficiency of operation has in
creased. We have been enabled to
undertake many new enterprises.
Among these are the adjusted compen-
sation Of the veterans of the World
War, which is costing us $112,000,000 a
year; amortizing our liability to the
civil service retirement funds, $4,000
600; increase of expenditures for rivers
and harbors, including food control,
S43,000,000; public buildings, SAT 900, 900
al 1870 WE oklSIlb 90O,UJu,OUu III bIl@
adjustment of war claims and alien
property. These are examples of
large list Of items.
Peace and Progress
in Foreign Relations Seen.
when We turn from our domestic
affairs TO our foreign relations, we like
wise perceive peace and progress. The
Sixth International Conference of
American States was held at Habana
last Winter. 1t contributed to better
understanding and cooperation among
the nations. Eleven important conven-
tions were signed and II resolutions
passed. Pursuant to the plan then
adopted, this Government has invited
the other 90 nations Of this hemisphere
to a conference on conciliation and