The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1936-01-25
PLANS MADE
T0V0TE0N
MONDAY
Congress Facing New
Storms Over Taxes
and Initiation
BY WILLIAM X. HUTCHINSON
international News Service

Congress, the Senate today was
prepared to follow the House in
enacting the new baby bond"
bonus bill into law over President
Roosevelt'S veto.
An International News Service
check of the Senate indicated it
would pass the bill over the veto
by a vote of about rs to 20, in
Guiding pairs. This would about
match the House vote Of 324 to
81 to enact the bill over the
veto. The Senate will vote Mon
day.
Foes of the bonus started talk Of
new taxes to pay the cost Of the
$2,491 100000 outlay. Administra.
ton bonus leaders Immediately
contradicted these reports, but
did so without consulting either
the President or the Treasury.
Views on New Taxes
Representative Doughton Cd
of North Carolina, chairman Of
the House Ways and Means Com
mittee, said:
'The action Of the House in
overriding the Presidents veto
of the bonus bill does not
necessary mean new taxes
must be enacted"
Senator Harrison CD Of Mis-
sippi, chairman of the Senate
Finance Committee, said:
"The bonus will be enacted
into law over the veto, but
there is no necessity for enact
ing new taxes on that account
at the present session Of Con-
gress."
Initiation talk was launched in
both House and Senate corridors.
Representative Lee Cd OF Okla
homa, introduced a bill In the
House to pay the bonus with an
issue of new currency. This was
along the line of the Patman bill,
sponsored by the Texas Repre-
sentative last year and which
died when the Senate sustained
a Roosevelt veto. -.
McCarran Has Plan
Senator Pat McCarran CD OF
Nevada, announced he would
sponsor a bill, authorizing the
Treasury to purchase another bill
lion ounces of silver, add it to the
1.5OO,O00,000 ounces now in the
Treasury and issue Treasury silver
certificates against this holding to
redeem the baby bonds when
cashed by veterans. This plan
had the endorsement Of Senator
Thomas CD Of Oklahoma, silver
inflationist, whose similar pro-
posal was defeated by the Senate
last year and again this week.
Talk of initiation developed be.
cause the pending baby bond"
bill carries no direct appropriation
to cash the bonds, except 1854, 000,-
900 now available in the old bonus
fund.
The bill meanwhile would dis
tribute $2,403, 214,000 in bonds and
$87, 786,05O in cash. OF this, all
the cash and $1,836,213,950 OF
bonds will go to veterans.
If all the veterans cashed all
their bonds within the first year.
the Government would require ST.
670,000,000 in new cash. Authority
to raise this sum must be given
the Administration in separate
act of Congress. When the time
comes for final vote on 1t, Con-
gress will have to decide whether
to instruct the Government to
raise that money, or as much as IS
required, through a regular bond
issue or by issuance of new cur
rency. It really will amount to a
second bonus battle-over the
method of raising the needed cash
Views of Leaders
Leaders of veterans organiza-
lions, however, insist no such huge
sum will be required. They de
clare a great number of veterans
will hold their baby bonds, be,
cause the bonds will draw 3 per
cent interest f0r the next 10 years.
Several officials estimated but
100000 cash would be needed
in the first year and that the
Treasury can easily raise this on
short term notes at low interest
rates.
The outlook over new taxes to
nv the bonds cost was clouded
with douIt. This was due to the
fact that congressional leaders do
not desire to impose new taxes
Just before a presidential election
and the additional fact that
they do not know what President
Roosevelt will demand. New taxes
therefore rested entirely with the
President and whether Congress
will obey him if he asks for new
1evieS.
The House vote on the bonus
incidentally showed party lines
shattered as on every previous oc'
casion. The same situation will
prevail in the Senate, when 1t
votes Monday.
After the bill is enacted into law,
veterans will have to file applica'
tons to exchange their bonus GER
tificates for baby bonds. Arrange
ments for such applications will be
announced later. Baby bonds then
will be issued directly to the vet
Grams, with distribution starting
late In the summer and redemp
tion starting June is.