Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-05-29
The Billion-Dollar Deficit.

the country the Treasury deficit stands
in days of peace above billion dollars.
Fortunately the credit Of the Govern
ment is sound, backed as it Is by the
Nation. Secretary Mellon has already
declared the purpose Of the Treasury
Department to meet the deficit through
borrowing. But he has added that Dor
rowing is merely a temporary expe-
dent. There must be some other solu-
ton Of the Governments difficulties.
The recovery Of business, with CORE
spending fiow Of revenue from the Fed
eral income taxes, might turn the trick.
Added Federal taxation and drastic
economy in governmental expenditures
are other measures which may be
adopted to meet the situation.
The Congress already has authorized
expenditures and made appropriations
for the fiscal year that ends June &c.
1892. The only possible economies in
that period are those which may be
made by the executive departments OF
the Government. But another Con-
gress meets next December, and upon
that Congress will devolve the duty OF
making the appropriations for the fiscal
year ending June 80, 1888. Perhaps
the new Congress will heed the warn
ing constantly impressed upon the old
Congress both by President Hoover and
by Secretary Mellon. The old Congress,
however, gayly went its gait when 1t
came to authorizing the soldiers bonus
law, which required the Federal Gov
eminent to find another billion and
more dollars to put out at this time.
There have been demands from con-
gressional quarters now for a special
session Of Congress, to be called I'M
mediately, so that there may be addi-
tional expenditures authorized for huge
Government construction programs and
for q Federal dole. II these demands
are an indication Of the temper Of the
majority Of the new Congress, 1t does
not augur we'll for what may be ex-
pected when under the law the Congress
assemblies in December Of this year.
However, the people themselves may
have taken cognizance of the situation
by that time and have calming in
fiuence upon the National legislature.
The deficit which now confronts the
Government differs from the public
debt, although it adds to that debt.
The deficit arises from the fact that
the budget Is unbalanced, with the ex-
penditures exceeding by more than a
billion dollars the receipts Of the Gov
eminent. With the governmental ex-
penditures ranging around $4,000, 000,-
900 a year, will any one have the te-
merity to suggest that they are too
small?
The country is gradually readjust-
ing itself to the conditions which have
arisen, due to overproduction and to an
orgy of speculation. There IS reason
to believe, according to high officials Of
the Government, who have made a
study of the situation, that the read
justment Is more nearly completed than
had been supposed. The prospects are
for excellent crops and, even though
prices for agricultural produce be low,
big crops are expected to add much to
the farmers buying power, since at the
same time the prices Of the materials
which the farmer must purchase are, in
many cases, correspondingly low. No
one doubts that If the Treasury De-
partment puts out large bond issue at
low rates of interest, it will be snapped
up in hurry, indicating that there is
today plenty Of money in the country
still seeking profitable outlet. The
curtailment Of business has brought
about a greatly curtailed production of
all kinds Of commodities. The pros
poets are for an increased demand
within comparatively short period,
which should bring with it increased
production and a resumption Of full
time work In the industries of the
country.