The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1932-11-15
ACUTE BUDGET
PROBLEM WILL
HARRY HOOVER
New Economies Must Be
Effected, New Tax
Sources Found.
SALES LEVY ADVOCATED
G. O. P. Leaders viii Urge
Passage; Beer Issue
in Forefront.

BIZ United Press
WASHINGTON, Nov. 15.-An acute
federal budget problem which must
be met in his message to congress in
three weeks faces President Hoover
as he returns to the White House.
The situation he will find is
marked by three essentials:
l. The federal budget is unbal-
anced by one to one and one-half
billion dollars, fact of more than
ordinary Importance, because of the
new calls that will be made for re-
lief and the additional fact that re-
financing operations must be under
taken.
2. New economies and new tax
sources must be found.
3. The foreign debt issue is near
ing showdown.
Sales Tax Advocated
The President will find his pro-
gram on these difficult to compose,
not only because of divergent views
in congress, but also because the new
administration will have the veto
power on practically anything he
proposes.
BY such Of his congressional lead
ers as Senator David A. Reed (Rep.,
Pa, the President will be urged to
recommend a general sales tax. In
deed, both Hoover and himself and
Secretary of Treasury Ogden Mills
favor this levy, as edo such prom
inent Democrats as Al Smith and
John RaSKob.
But this issue probably can not
be settled at this session without
the beer controversy being also set
tied, for beer tax advocates, gen.
orally speaking, hold the opinion
that the yield from this levy prac-
tically will balance the budget if
drastic economies are effected.
Success of any budget legisla-
ton apparently will depend upon
the outcome of the "co-operation"
between Hoover and his successor,
Unless some working agreement is
reached, the writing of new tax pro-
posals will be in charge of two lame
ducks, Chairman Reed Smoot (Rep.,
Utah of the senate finance commit
tee, and Chairman Collier Dem.,
Miss of the house ways and means
committee.
Work on Budget
The new budget has been in the
course of preparation for some
weeks, and now is in it's tentative
form, but considerable confusion
exists as to whether the house APP
preparations committee can get
down to work this week, as ex-
pected.
This results from the Democrats
promise to reduce expenditures by
25 per cent; the probability that a
vigorous fight will be made on the
federal prohibition bureau appro-
priations, and the impending Sug-
gestions of the President for reor-
ganization of governmental ma
chinery.
Vi OllCI COlllk11OdOlOllS WILL NC
presented in the forthcoming
recommendations for economies to
be presented by the two house
committees, one investigating vet
Grams legislation, the other gen.
eral economies.
Seeks National Tax System
A broader phase of the taX-budget
problem is being investigated. by
still another house committee, which
will report soon on the clash of fed
era, state and local taxes.
This is a subject in which Roose-
welt has expressed deep interest.
He hopes to negotiate some definite
national tax system.
The foreign debts controversy af-
fects the budget bec;.use just so
much of these debts as are post
poned this year, that much more
money will have to be gathered
here. In the long view, these are
ais the means for paying off the
fourth liberties.
The lame duck congress to which
Hoover will present his program
on taxes, the budget and debts
meets in three weeks.