The Omaha guide., 1935-01-26
ECONOMIC
HICHLIGHTS

ASK a dozen economists this
question: "How great a debt can
the federal credit stand?" The
chances are that you will get a
dozen different and opposed an
SWerS.
Not so many years ago finan-
cial authorities fearfully forecast
that he nation debt would soon
reach the 10 billion dollar mark,
said that this would mean the be-
ginning of a collapse in the ma
TONS credit. Today the debt has
! passed 80 billion dollars, and some
authorities believe that it will
reach so billion before many years
have passed. Yet little fear is
now expressed as to slOvncy Of
our government. Treasury Off
Gals say that so billion dollars
would not be an excessive debt
for so rich a country.
The Presidents budget mess
age was predicted upon the theory
that it will be possible to achieve
a smaller deficit in the 1886 fiscal
year than in the 1885. Federal
bookkeeping today Is done under
a sort of dual system. One set
Of books takes care Of the regul-
ar budget. Anoher involves e
mergency expenditures which, in
the view Of the Administration,
are much like war expenses and
so cannot be carried on the books
as normal spending. This sys-
tenn has led to confusion Of the
public which has been told, on
the one hand, that the government
is cutting costs, while on the
other hand, it sees the deficit and
taxes constantly rising.
Els mated receipts for the 1886
fiscal year regular budget total
SO. 600, O00-an advance Of
1929, 900, 900 over 1885. Estimated
expenses are 1920 coo, 900, a rise
Of 1914. 564,243. This leaves an
encouraging estimator surplus, so
far as regular income and spend
inc is concerned, Of 1922. 100000.
The next step, however, con
Germs the emergency budget. The
Administration plans to spend
some 1852 OO,0 900 for e~xtraor-
binary purposes, asopposed to an
income of $500 200, OOO which Will
come from various AAA activities.
This leaves a deficit Of $4, 10000
900.
AS a result, total expenditures
for Irregular" and "extraordin-
airy" budgets will be $7,844,OOO,
900 a drop Of $124,543,00O from
1885. Total receipts from all
sources will be So, 1892, 000,0 900, a
rise of 1921, 100000 from the pre-
ceding fiscal year. The total ret
deficit will thus be 1892, 100000
GAIA OO, 900 less than the 1885
deficit) which muist be added to
the soaring national debt, bring
it close to the IS billion mark,
There is the budget situation IN
a nut shell. Great as the deficit
is. the President and many finan-
cial experts say it is "well within
the nations resources" 1t re-
mains a fact, however, that the ma
tional debt must eventually be
paid-ad that in the meantime
hundreds of millions a year must
be spent for interest. All Of this
money has to be raised by tax.
alton, and the greater the debt
the greater the burden on indus
trv-and the less money it has
for other purposes. Nineteen.
thirty-six Interest expenditures
for example, will come to the
neat sum If 1915, 100000. a iumr
of 41,OOO.OOO over the 1895 fiscal
term.
To get away from the economic
aspects Of he budget, one Of its
most interesting phases is the pro
posed expenditure of 900 million
dollars for national defense. II
| Congress authorizes this expendi-
ture, as it probably will, 1886 vii
witness the greatest "peace-time
war expenses" in the nations
history. The President announ.
J ced these figures without com.
ment-it is obvious however, that
they are principally necessary by
Japan abrogation Of the treaty
Two years from now, when the
treaty expires, Japan will start tc
build naval craft on a grand
scale, and the United States must
keep up with her. At the preseD'
time our naval strength is vel
below our treaty. limit. This ton.
mage deficit will be made up, fol-
the most part, within the next
two years.
"GOD AS A MYTH"
BY r. A. Adams
(For the Literary Service Bureau