The McDowell times. [volume] (Keystone, W. Va.) 1904-1941, 1936-10-09

the banks and other people having
IDLE money to purchase four hum
dred millions in new government
bonds and at the same time asked
them to extend loans totalling about
500 900, 900 that matured on Sep
TENDER is. The maturing securi-
Ties, OF course, do not take new
money out Of the money market,
but it is borrowing just the same
despite the technical name of re-
funding.
The TreaSury's action in borrow
ing such huge sum at this time
came as a surprise. To many finan-
cial authorities. in fact to most
OF them. there was no need for bor-
rowing additional funds at this time.
II was a circumstance in which, as
lar as most observers could see, the
treasury had idle money in suffi-
clent amount to meet the needs
Tor the next several months.
Aside from the fact that the Sec
retary's action results in an increase
IN the public debt by the amount of
new money borrowed, it is a matter
deserving more than passing atten-
ton - much more attention than
Treasury borrowings heretofore.
The reason is that the administra-
ton is again piling up in the Treas
ury huge amount of idle funds. AS
nearly as can calculate the re-
suits OF the September borrowings,
the Treasury will be left with a
mere 81, 700, 900 in unused cash. OF
course, to the Roosevelt admin
istration which has dealt only in bill
hons, this sum may not appear inn
portant. Mr.. Morgenthau said it
was necessary to have these funds
available because of unsettled con-
ditions" abroad. But that answer,
to me, does not suffice.
recognize that most people find
little interest in discussing Treas
ury financial policies. know from
the type of letters that I get from
those who do me the honor to read
these reports that the subject OF
Treasury finance seems far re-
moved from anything in which they
can possibly have an interest. Blu,
Notwithstanding those facts, I fee
the matter should be discussed ir
every section Of the country tecause
1t directly touches every taxpayer;
and that is of vital Importance.
Here Is how 1t affects the taxpay
er and when I refer to the taxpaye,
refer to every individual in thi:
country, because all of us are pay
ing taxes either directly or indirect
| ly: When the Treasury arranpes
cash balance, it provides funds
upon which the various government
agencies may draw in accordance
with congressional appropriations
To that extent it is like money
you deposit in a bank But other
wise it is quite different. The cash
balance in the Treasury lies idle.
1t brings no return, no profit to any
body.
But 1t is important to remember
that there are only two ways in
which the Treasury can get money
for this cash balance, namely, by
borrowing or by taxing you and
me. During the Roosevelt admin
istration the Treasury has borrowed
about $2.l2 for every dollar it has
collected in taxes. The result is a
gigantic public debt.
There is another result, however.
that is not as apparent to individu-
ais. Since the Treasury is borrow
ing money it has to pay interest on
what 1t borrows. You and l are
paying this interest in the form of
additional taxes. So, therefore, not
alone are we being taxed for the
money that is spent and which must
be repaid, but we are being taxed
to pay the interest on idle funds
Mr.. Morgenthau's reference to I'M
settled conditions abroad directs at
tention TO what is happening in Eu-
rope and Asia and the link that ex-
lists between those conditions and
our own.
President Roosevelt lately has
said on several occasions that he
re-. did not like to be
CondHionS away from Wash
Abroad lngton more than
four or five days
at q time because of those unsettled
COlluibiOIIS. LNtl y OllC huOWS NndL
our foreign friends are rcarming
believe every one realizes as
well, however, that each of those
foreign nations is in a position
where it cannot initiate hostilities.
At least, each one is in a position
where very great provocation must
occur before it can justify the start
| ing of war in the eyes Of nations
like our own.
Any one who wishes to examine
those unsettled conditions will find
at the very bottom two types of
propaganda. One comes from Rus
STA, the other from Germany. The
two types of propagandists, while
violently hating each other, are
preaching exactly the same sort of
thing They are telling the world
that if the world wants peace it
must align itself with one or the
other of the two schools Of thought,
depending upon which type of prop
uganda you read. With circum-
stances like that going on abroad,
IT seems to me that we as Ameri-