Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-12-29
CHICAGO, BROKE
MAY CALL DAWES
City in Worst Finance TanuIe
of HiStory-SiIaS StraWn
Attempts to Aid.
BY OLIVER SHERWOOD.

BY OLIVER SHERWOOD.
Special Dispatch to The Star.
CHICAGO. December 28-This city
may yet find itself impelled to call upon
It's famous flnancier and diplomat, Gen.
Charles Gates Dawes, to give it one of
- famous plans for financial salvation
Germany's tangled money problems.
which the former Vice President set
about solving without a Qualm, were
scarcely more intricate than those
which right now are bothering Gen
Dawes home town. This time. how
ever, fellow townsman of the present
Ambassador to the Court Of st. James
Eilas Strawn, is to take q fling at the
role of "rescuer"
At the moment creditors Of the vari-
Gus governing bodies of the fourth
largest city in the world are crying for
their money, Banks are very wary
about extending further credit. They
look with such disfavor on the mess in
which the city finds itself that the
word bankrupt" frequently is used.
Heroic measures have been required
merely to meet pay rolls. In fact, Ber-
Inns recent financial Squabble, which
attracted world attention, was q small
change matter compared with Chicago's
troubles.
Eat Up Advance Revenue.
Already anticipated revenue for near
~ 6WO yCdAS III duNdllCC Is GdlSn
Public works are virtually at a stand
still so far as the city is concerned
The streets have been permitted to de-
0eriorate into an almost impossible con-
dition. So broke" has the city been
that tremendous business losses were
piled up simply because it had no money
with which to clean up its side streets,
or even main thoroughfareS, following
the recent blizzard.
Chicago voters are sitting back and
rather enjoying the spectacle as poll
ticianS and officials scratch around for
cash. They have reached the conclu-
sion that the present crisis Is the result
Of ofnciaa encouragement, considerable
political grarr&1sd good deal of whole
sale feeding at the public trough. So
OF late every opportunity afforded voters
20 knock over a proposed bond issue or
70 harass politician has been taken
advantage of.
Lop Police and Firemen.
Decision of the finance committee of
the city council to cut $50 policemen
from the local force and to lop of 200
Aremen from the rolls, along with the
struggle to find cash with which to
pay the city's teachers, all are indi-
catiye Of present conditions.
Thu rescue committee" headed bv
Mr.. Strawn, who is chairman of the
board OF Montgomery, Ward & Co. and
. leading attorney, which is called upon
TO pull the town out of the financial
mire, viii find the following conditions
confronting it:
Between January 1 and March the
city, county, school board and sanitary
district will require $27, 000, 000, and be-
tween March / and AugusU an add.
tlonal $50 100000, with no one quite
sure where the cash can come from.
The city,s corporate fund Is in this
position. Tax receipts for 1928 and
1923, uncollected, are estimated at STA
$4,000, once they can be gathered.
About 10 per cent of this amount is
eaten up at once In interest. The city
has $72 1885, 900 outstanding in war;
rants issued In anticipation of taxes.
1t has dug 10000, 900 more out of the
treasury without warrants, has $1,000
e00 In unpaid bills and $4,000, 900 In
judgments against 1t which are unpaid. |
Banks Refuse Warrants
The situation As such that banks are |
refusing to take additional tax antici-
patton warrants. The interest rates on
recent tax warrant issues are excep-
ttonally high because Of the condition
IN which the city finds itself
Mr.. Strawn has explained what the
c1tys bankers and business men want
TO do. They are willing to loan their
experts to help the city work itself out
~ SA1c pICSCuG ana J0elr Of
Sers have been accepted by the county
and the sanitary district, but Scorned
by the city.
The committee was created" Mr..
Strewn declared, because it was real
lied that we had outgrown a system of
taxation created 80 years ago. and be-
cause the habit of issuing tax antici-
patton warrants and thereby imposing
upon the people an enormous annual
super-burden of interest charges. then
spending the money a year before IT.
was collected, and the failure to limit
budget to resources. has become in
tolerable.
This custom, followed for a num-
Der OF years, has resulted in such an
accumulation of floating debts and def
cts In the funds available for public
purposes that our public officials seem
unable to function"
The committee, working with experts.
would investigate and propose changes
In laws OF taxation and administration
In such way that the public could
keep an eye on conditions and 'be as
eured that the money it pays for taxes
Is economically expended for legitimate
public purposes"
At present Chicago voters are of the
opinion that their troubles grow from
the fact that tax money has gone in a
good measure for other than legitimate
public purposes.
(CopyriRht, 1920