Evening star., 1933-03-26
Budget Balancing and Borrowing.

Budget Balancing and Borrowing.
On the banking bill, the economy bill
and the beer bill Congress maintained Q
pace that kept 1t abreast Of President
Roosevelt, passing these measures al
most as soon as the President sent them
along.
Since then the President has outdis-
tanced Congress by at least two jumps
the farm bill and the reforestation-re-
lief bill-and can take breathing spell
while. Congress catches up.
The interval has served to project one
significant question, to be answered
only when the administration decides
what financial policy Is to be pursued.
The taxpayer has learned, on the one
hand, that by means Of one Of the most
drastic delegations Of authority ever
made by the legislative branch of the
Government to the executive branch
the budget Is to be brought into some
sort Of balance. Appropriations for the
running expenses Of the Government
are to be cut to minimum. Revenues
from legalized beer are to be utilized,
together with the savings from the va
rous economies, to make governmental
income meet governmental outgo. Thus
Government credit will be maintained.
But the taxpayer has learned, on
the other hand, that even while these
things are being done, the same Govern
ment Is contemplating stupendous out
lays. AL sorts of outlays are being
talked about. In addition to enlisting
q voluntary army Of quarter Of Q
million men, to be fed and housed at
Government expense while they work
for a dollar day in reforestation, the
Government Is planning to make addi-
tional grants to the States and the
cities for relief, sell bonds for ref1nanc-
ing at Government risk billions Of
dollars worth Of farm and home
mortgages and. later, perhaps, under
take new public works for relieving en-
ployment.
Considering the relatively small
amount that will be available to bal
ance the budget" and at the same time
contemplating the vast sums required
to carry out the various forms Of re-
lief Is a confusing undertaking.
Some observers are inclined to believe
that what the administration has In
mind is the establishment of what
might be considered two separate ac-
counts. One of these would include
the expenditures for normal govern
mental activities and would represent
the Federal budget, which would be
maintained in balance by keeping 1t to
the level Of available governmental in
come from existing taxation. The
other would include the extraordinary
expenditures for public relief, financed
through bond issues, and also include
the establishment of the necessary
sinking fund. This second budget"
would be balanced by generations yet
unborn.
Senator Byrnes Of South Carolina
proposed in bill last year the segre-
cation Of public works expenditures
from the normal expenditures Of the
Government, taking the view that the
normal budget Of the Government
should not be unnecessarily thrown out
of balance by being forced to assume
the extraordinary expenditures brought
about by demands for relief. The Hoo
yer administration was consistently op-
posed to the policy Of continued bor-
rowing, holding that governmental ex-
penditures must be kept to the figure
that can be met by current revenues.
Such a policy could not be maintained
If the new administrator plans for
various forms Of relief are to become
effective. The new administration con-
ceives the present economic emergency
in the light of a war, which makes ex-
tensive borrowing necessary II the
money Is to be had to carry it on to q
successful and victorious finish.
There is at least enough ardent de-