The Bismarck tribune., 1931-12-08

June 80 last we incurred q deficit of
ebout S903, ,O00, 900, which included the
statutory reduction of the debt and
represented an increase of the ma
tional debt by $616,0OO,0 900. OF this,
however, $153, ,0O0, 900 is offset by in
creased cash balances.
Cut $1,6ss, 100000
In comparison with the fiscal year
1928 there is indicated fall In fed
eral receipts for the present fiscal
year amounting to 81 1,683 ,0O0, 900, of
which 1904, 100000 is on individual
and corporate income taxes alone.
During this fiscal year there will be
an increased expenditure, as COM
pared to 1928, on veterans of $685.
O0O, 900, and an increased expenditure
on construction work which may
reach 100000. Despite large
economies in other directions, we
have an indicated deficit, including
the statutory retirement of the debt,
of $2,123, 100000, and an indicated
net debt increase of about STILL
100000.
The budget for the fiscal year be-
ginning July next, after allowing
for some increase of taxes under the
present laws and after allowing for
drastic reduction in expenditures,
still indicates a deficit of $1,4l7.-
100000. After offSetting the statu-
tory debt retirementS this would in
dicate an increase in the national
debt for the fiscal year 1888 of about
1921 100000.
Several conclusions are inevitable.
We must have immediate and deter
mined reduction in government ex-
penSes. We must face a temporary
increase in taxes. Such increase
should not cover the whole of these
deficits or it will retard recovery. We
must partially finance the deficit by
borrowing. 1t is my view that the
amount of taxation should be fixed
so as to- balance the budget for 1882
except for the statutory debt retire
ment. Such government receipts
would assure the balance of the fol-
lowing years budget including debt
retirement.
Solely as Emergency
It Is my further view that the ad-
ditionAl taxation should be imposed
solely as an emergency measure ter
minating definitely two years from
July l next. Such a basis will give
confidence in the determination Of
the government to stabilize its fl
nance and will assure taxpayers Of
its temporary character Even with
increased taxation, the government
| will reach the utmost safe limit o1
its borrowing capacity by the ex.
penditures for which we are already
obligated and the recommendations
here proposed. To 60 further than
these limits in either expenditures
taxes, or borrowing will destroy con-
! fidence, denude commerce and in.
dustry of it's resources. jeopardize the
financial system, and actually extenC
unemployment and demoralize agrl.
culture rather than relieve it.
FEDERAL LAND BANKS
/ recommend that the congress au.
thorize the subscription by the treas.
ury OF further capital to the fedora
land banks to be retired as provided
in the original act, or when fund!
are available, and that repayment o
such capital be treated as q fune
available for further subscriptions II
the same manner. It is urgent tina
the banks be supported so as to stab
ilize the market values of their bond
and thus secure capital for the farm
ers at low rates, that they may con
tinue their services to agriculture ant
that they may meet the present situa
ton with consideration to the farmers
DEPOSITS IN CLOSED BANKS
A method should be devised II
make available quickly to the deposi
tors some portion Of their deposit
in closed banks as the assets of sucl
banks may warrant. Such provision
would go far to relieve distress in
multitude Of families. would stabiliz
values in many communities, an
would liberate working capital t
thousands OF concerns. I recommen
that measures be enacted promptly t
accomplish these results and sug
gest that the congress should corlside
the development Of such a pla
through the federal reserve banks.
HOME LOAN DISCOUNT BANKS
I recommend the establishment 9
/ a system Of home loan discoun
banks as the necessary companion i
our financial structure of the feders
reserve banks and our. federal Ian
!, banks. Such action will relieve pres
ent distressing preSSureS agairls
home and farm property owners.
twill relieve preSsureS upon and Civ
! added strength to building and loa
; associations, savings banks and de
posit banks, engaged in extendin
! such credits. Such action would fun
: ther decentralizc our credit structur
1t would revive residential construe
ticn and employment. II would er