The Daily Alaska empire., 1931-02-28
THE BONUS VETO.

In vetoing the soldiers bonus, Veterans Relief measure President Hoover fulfilled the prediction of both his friends and foes. Weeks ago, when agita- tion before Congress was at it's highest point, Sec retary Mellon voiced the views of the Treasury De- partment so unmstakably in opposition to the com promise plan that it was universally felt the Presi- dent could do nothing else except disapprove the bill If he had signed the measure the vigor with which MT. Mellon had opposed it would have left the latter no alternative to resigning.
 As had been predicted by Washington observers Congress overrode the Presidential dsapproval Only handful of the Administrations supporters had the political courage refrain from joining the stam- pede for the bonus bandwagon. But the reasoning in MT. Hoover's veto is not affected by Congress sional action. Unlike the executive, Congress is subject to reaction from feared political results and its course many times is predicated upon it's out come represented by the ballot box count to than by the economic necessities of the time. Pos sibly MT Hoover foresaw that Congress would verse his decision and addressed his veto message as much to the country at large to its law makers.
 His objections to it unquestionably serious Under its provisions if every ex-servce man entitled to do so were to apply for the loan authorized it would require s1,7OO 100000 to defray the cost Many of course will not apply but the total loan demands must aggregate a tremendous sum, probably approximately Sl O00000 0000 Of course, the Treasury has no such fund in its vaults to apply for that purpose. To obtain it, securities must be put on the open market at reasonable rate of interest Finaneiers generally are agreed that such an issue will unsettle the securities markets of the country, which will have harmful effect upon other businesses and industries
 Within the next few years the country, as MT Mellon has pointed out has several billions of dollars in outstanding bonds which must be refunded large percentage of these issues wartime securi ties bearing Az per cent interest. It had been hoped to finance them with lower interest bonds MT. Mellon is convinced this will not be practical If large issue is floated Thus with the interest payments required for the veterans loar issue, these costs only be met by taxation 4 deficit is certain to be encountered in the nex fiscal year in the conduct of the Governments bus the Treasury estimating will be $500 900 GOO It is evident therefore that MT Hoover was not al alarmst when he warned Congress that the proposet loan program will cause higher Federal taxes This too will hurt business and industry and retard tn recovery from depression which everyone is S anxious to take place without long delay
 MT Hoover's warning that it will not be goo, for the veterans themselves is based upon tw factors. If the loan program is not good for tn country whole it cannot be good for tn veterans. It is self-evident if it is bad bushes for the rest of the country, whatever temporar- benefit may accrue from it to the veterans in tn end it is just as bad for them There is more over, further contingency which may, indeed more than likely to- arise in the not so distan future The present minimizing hystera that make people acquiesce in such demands upon the treasury