Evening star., 1934-10-28
DILEMMA CREATED
BY BONUS DEMAND.
Legion Action Brings Ger
tainty of Some Sort of
Legislation in January.
BY DAVID LAWRENCE.

Law
Chickens come home to roost. Fed
eral spending and unbalanced budgets
sooner or later awaken the desire of
all groups to share in the outgivings
of a bounteous administration.
Hence the overwhelming vote of the
American Legion at its annual con-
vention in Miami this week presents
dilemma of the first magnitude. For
1t would cost at least $4,000, 900, 900 to
pay off the so-called soldier bonus.
That the compensation is due the
veterans cannot be disputed. That it
might have been paid during the orgy
of spending in the last Is months, and
possibly have accomplished more
the administration has sponsored,
will be argued by the Legionnaires.
But there can be no debate about
the fact that the American Legion
held of on its demand for payment as
long as it appeared that an economy
wave was In progress and that 1t re-
vived its demand when the admins
tration gave little heed to the question
of balanced budget.
With the elections less than fort
night away, Republicans and Demo-
Gratis will be asked to declare them
selves on the stump. Many of the
newly elected Congressman will come
to Washington pledged to vote for the
bonus.
Bonus Action Certain.
Some sort OF bonus bill will be
adopted at the January session of
Congress. The only question now is:
What kind?
The administration will find its ef
forts confined almost entirely to cut
ting down the size of the expenditure.
The resolution of the American Le-
gion convention recommended that
not only should the face value of the
adjusted compensation be paid, but
that interest be Cancelled and, If it
has already been paid to the Govern
ment, that it be refunded.
The original bonus plan was
adopted on the theory that in 1945
paid-up inSura nee policies be awarded
to the veterans. Congress was to set
aside annually a certain sum OF
money. This sum was to draw interest
from year to year. In 1945 principal
and interest were to be paid.
But the veterans organizations were
not content to wait till 1945. So the
Congress was persuaded to lend
against the sums that would be due
in 1945. 1t was assumed that the
full sum would be available in 1945,
interest included. If the bonus were
paid in 1885, on the basis that all life
insurance companies operate, there
would be no payments made for inter-
est not yet accumulated.
Sum to Be Considered.
But since politics and political
pressure are going to determine the
result, the total sum the veterans
want from the Treasury is for all
practical purposes the amount that
has to be taken into consideration.
There Is nevertheless room for
argument on how much is really due
the veterans. Also, there will be con-
siderable embarrassment If Congress
votes to cancel the loans already made
or the interest already paid. For it so
happens that other groups have bor-
rowed money from the Government
and if there is to be a cancellation
psychology it might apply all around,
with consequent dangers to the credit
of the Government itself.
It seems more likely that when
the bill is finally voted upon, it will
have been amended considerably in
committee and that members of the
Senate, for instance, who are not up
Immediately for election, will prefer
to make a fight against refunds or
cancellation of interest and that some
compromise plan to pay of the bonus
in three annual installmentS may be
suggested as a way out.
Mr.. Roosevelt will veto the bill un-
less some counter suggestion, enabling
the bonus to be paid without imne-
diate drain on the Treasury, is offered
During the campaign of 1882 he stud
led seriously a plan to transfer the
matter in some way to private insur-
ance companies. This may be revived.
But the truth is the American
Legion convention has moved toward
adoption of some sort of bonus bill at
the January session of Congress and
1t is going to have its way this time,
though it may be compelled to COM
promise on some of its demands.
President Roosevelt has hitherto de-
clined to sign the bonus bill because
he felt the Government finances
couldn't stand it. He probably will
give the same reason now, but it is
questionable whether he can kill off
the bonus legislation unless he takes
determined position on the balancing
of the whole budget and the reduction
OF expenditures generally.
(Hopvrjobt 1OqAN