Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1936-08-27

N0 NeW taxes is regrettable
Tax Leuies and that there must
be no new levieS
nor tax increase by the next con-
gress. He chose to get his views
to the public by staging confer
ence at the White House the other
day when he summoned Chairman
Harrison of the senate finance COM
mittee and Chairman Doughton of
the house ways and means COM
mittee for breakfast meeting to
discuss the subject. He followed
this almost too quickly by releas-
ing statement, letter from Sec
rotary Morgenthau that substantial
ed the spoken word of his two con-
gressional leaders.
But somehow the word from the
White House prompted many OBJ
servers here to pick flaws in the
pronouncement; they began at once
to find several places in the new
picture that appeared to have been
smeared over by the paint brush,
and, in addition, there was sud-
den yelp from the Republican ma
tional committee which did not help
Mr.. Roosevelt's plans to show the
country that the tax burden had
reached its peak.
The Republicans were quite harsh
because they called attention to the
fact that Mr.. Roosevelt on three
previous occasions had assured the
country there would be no new
taxes, and that in each instance
new tax legislation somehow or 9TH
er had been enacted by congress.
Aside from the presidential dec
laration that there would be no new
taxes nor increases in the present
levies and that there would be a
study of the general tax structure,
the President made the point
through Secretary Morgenthau's
letter that there were a good many
hundred millions in recoverable
assets" He also urged upon the
country that business has improved
so rapidly that additional federal
income may be expected from the
present tax rates. This latter, of
course, is true providing business
holds its own or moves to higher
levels but it is with respect to the
recoverable assets that many ques-
tons now are being asked. For
the sake of clarity, it may be ex-
planned that the recoverable assets
to which Mr.. Roosevelt referred
consisted of the loans of federal
money by the various emergency
agencies for relief and recovery
purposes. There are the millions
loaned by the Reconstruction FL
nance corporation; the equally
large amounts loaned by the Works
Progress administration and the
Public Works administration to
states, counties and cities for relief
or for job-making construction. In
addition, there are loans by the
Home Owners Loan corporation,
the Federal Farm Credit adj
ministration, loans for crop produc-
ton, for marketin.! and countless
other types. These are all carried
on the books as recoverable assets
and their total may amount to as
much as $4,000, 100000.
The policy of the New Deal ad-
ministration is to consider these at
their face value. 1t is the claim
of the White House consistently that
these loans will be repaid and that
they can be used to retire an equal
amount of the national debt, which,
indeed, is true if the loans ever are
repaid.
So, whenever the New Deal is
called on to defend itself against
charges of imposing a gigantic bur-
den OF tax or an equally gigantic
burden of public debt, its spokes-
men attempt to demonstrate that
the public debt figure as well as
the taxes must be considered in
their relationship to these recover
able assets.
To explain the Roosevelt position
further, one may recall that a
month ago when the public debt
reached the staggering total of $685.
779,000,000 the Treasury secretary
commended in public statement that
against this sum there should be
Offset the cash assets in the gen
eral fund of the Treasury, then to-
falling $2,681 ZOO, 900 and the 2,OOO.-
100000 of gold that is sterilized in
what is known as the exchange ster-
ilization fund.
''In addition" Mr.. Morgenthau
added in his statement, 1--WE have
certain assets representing obliga-
tons due us upon which the Treas
ury will realize cash and which will
ultimately be available for debt re-
tirement. These recoverable assets
millions to home owners, to farm
ers, to railways, to banks and in
surance companies, to states, and
cities-now total more than $4,000
100000. These three items-cash on
hand, sterilization fund and recov-
cradle loans-provide an offset of
$3.50, 100000 to the $33, ZIG, O00, 900
public debt"
1t thus is made to appear direct
ly in issue how completely the
Roosevelt administration calculates
using these recoverable assets in
| retiring the plIblic debt Ha,,;no