Evening star., 1933-11-24
DOUGLAS PREDICTS
BALANCED BUDGET
Declines Statement on Gold.
Says Middle Glasses Must
Bear Burden.
BY the Associated Press,

OCQi Oui OCIis
BY the Associated Press.
BOSTON, November 24.-A good ma
tional budget, Lewis w. Douglas. di-
rector Of the United States Budget Bu-
reau, declared yesterday, ivan counter
act the bad effects" of whatever none
tary policy the Government pursues.
The genial chief of the Budget smil-
ingly declined to be drawn into an
nit an expression Of his own views on
the gold program of the Roosevelt ad-
ministration, which recently led Prof.
Oliver W. M. Sprague to quit his post
Is adviser TO the United States Treasury.
He did say. however. he had no in
tention of following Sprague's path by
resigning.
Douglas, here to address the Ninth
New England Conference, semi-of-
fetal body representative of business
interests in the six New England States,
told newspaper men he felt the gold
question and that of monetary policy
were matters that were mot down my
alley"
Will Stick to Budget Job.
The budget, which he predicted would
be balanced, regardless of the eXtraord-
mary governmental expenditures, if he
could POSSIBLY do so, lis the job Presi-
dent Roosevelt has given me and I am
going to stick to it." he said.
He emphasized that what he thought
Of gold was of little Importance COM
pared with the job he had in hand
that of keeping Uncle Sans books in
balance.
Later, in addressing the conference,
he sounded a stern warning that if
additional governmental obligations were
incurred over and above those now con-
templated, "the great middle-class,
which furnishes the vitality and vigor
and moral tone to our body polite,
must willingly carry the burden Of saw
ing itself from destruction. for con-
tinuous and prolonged budgetary in
dation means its destruction
He declared it would be his endeavor
to keep the recommended expenditures
for the fiscal year 1885 down to 81
600.00O,0OO. and added that estimate
eral employees.
Text OF Douglas ADDRESS.
The address of Mr.. Douglas follows:
1T is with a sense of embarrassment
that appear here this afternoon. My
embarrassment is due. in addition to my
own lack of inclination to speak. to the
fact that my remarks will be confined
to an uninteresting subject. And yet,
because of its implications, to a subject
which has profound repercuSSions upon
human vo1nnc onH tho arnnnr1in welfare
OF our country .........
IF I may. I should like to revert
to March of this year. At that time the
def1ationary forces whose energies had
been damned up by artificial methods,
but whose outward expression had con-
tinued with great momentum finally
broke through the distractions which
had been created. The banking
moratorium was the result. The credit
Of the Government had become i'm
paired
The administration, among the first
of its acts, repaired the impairment of
that credit. The sctual expression Of
the repairment was the economy act.
With the credit SO repaired. the Gov
ernment undertook certain expenditures
which it considered to be socially and
economically necessary, and it divided
those expenditures into two categories:
The first, over which the Bureau of the
Budget had control, being those incident
to operations of the permanent agencies
Of the Government; the second, over
which the Bureau of the Budget had not
control being those having to do with
the so-called emergency expenditures.
Denies Charge of Two Budgets.
This division did not set up. as has
been so commonly stated, two budgets,
and as evidence of the veracity Of this
statement, 1 refer you to the Treasury
daily statement, in which you will flnd
but one deficit-a deficit arrived at by
comparing total expenditures with total
receipts. The division was made for the
purpose of convenience both for the
Government and for the public, so that
both might have full knowledge of the
purposes for which Government money
was being expended.
Il have seen exaggerated statements
of the cost of the administrations
emergency recovery program: Ihey
have ranged from to ii billions OF
dollars. In this connection, I should
like to take a few minutes to analyze
the purposes of these expenditures, the
extent to which they increased the ma
tional debt, and the amount of the IN
crease in the national debt which can
prudently be estimated to be on ac-
count of the loans which will be repaid,
based. of course. upon the Assumption
that there will be recovery from the
present depression.
Expenditures for Relief
"The increase in the national debt Is
due. in some measure. to the expendl-
lures for direct relief-the relief Of the
unemployed and the dest1tute-reheh 10
nreyRnt cold and StarVaJlOn-
mo one with a sense of social respon-
sibilitv can object to those expendi-
t,lres in the light Of demonstrateoly
inadequate private and local mechanism
THE second object of these expendl-
lures was that of attempting 10 piaee
our banking system In strong posltioi
This was important and still Is lmpor-
tant Ninety per cent of the business
of this country is done upon credit. IL
was and is essential, therefore, that the
credit system be made strong. But, more
than that, a substantial amount OF the
deposits of our citizens had become un-
available in closed banks. 1t seems not
only socially but also economically wise
and important that, to the extent TO
which it could prudently be done, por-
tion at least of these deposits be re-
leased to the depoSitors to Whom tney
belonged. This too. was and Is an un-
dertaking with respect to which lew Will
disagree.
THE third purpose for which these
expenditures were made was that OF
public works on the general theory that
they would bring some relief to the
heavy industries and consequently Gre
ate some additional employment.
Debt Increase in 1894 Foreseen.
"The final objective of these expendi-
lures is the attempt to support the price
of agricultural commodities during the
period in which it was to be hoped the
effects Of recovery would become evl-
dent.
"Predicated upon the present estimate
OF expenditures for these purposes and