Evening star., 1936-07-28

this kind in this months operations
of the Government. Hitherto this has
been called a recoverable asset" and
has been proudly pointed to by the
President and New Deal officials as
being one of the items that would
some day cut down the public debt.
The last official figure Of recoverable
assets" was about $4,000 100000 and If
q sizable amount like that is cut OF
the present public debt of $33,476,-
O0O. 900 it means a comfortable reduc-
tion.
Now, however, the New Deal is not
using the recoverables to cut down
debt but Is selling these assets. so to
speak, getting the money theretrom
and turning it over to various agencies
Of the Government to spend not In
more loans but in items that are not
expected to be recovered at all.
Propriety Questioned.
Instead of borrowing money and in
creasing the debt, the Treasury is
really turning over assets to be used
for Government expenses. There Is
no objection to such course If the
expenses of each agency are fully dis
c.osed and if the so-called recover
able assets" are shown to be dimin-
ished, but it is hardly proper to tell
the public that the recoverable assets
will be used for debt retirement and
then use them up in paying for cur
rent expenses of Government. It's
good deal like the situation that might
arise in a private corporation which
has q plant on which there has been
no mortgage and the company raises
money by selling such plant and
then puts the money into the general
account to pay current deficits with
out telling the stockholders that their
principal asset, the plants disap-
pearing as an asset.
One difficulty, of course, is that in
Government finance any money paid
out, whether 1t is in the form of
loan or direct grant is considered an
expenditure. At one time or another,
therefore, the money now being repaid
from loans was actually listed by the
Treasury as an expenditure. Hence it
need not be listed that way again.
Earmarking Is One.
But what shall the treatment be of
money paid into the Treasury from a
loan? Shall 1t 60 into the general |
fund and be earmarked there for |
retirement of public debt? Or shall |
it go into the general balances, where |
no public cognizance can be taken OF !
the use that is subsequently made?
Thus the expenses Of the Works
Progress Administration this month
are Sis, 100000 up to July %, against
only s50,840, 900 year ago this month
for direct relief. The Resettlement |
Administration is spending $l0,000,0O |
this month, as against 81 l,358,0OO
year ago. The Public Works Admin
1stration, which makes loans and
grants to local governments, has this
month spent s3l 100000, as against
So, ,491 900 a year ago.
So, while the expenses of many of
these so-called emergency agencies are
running much larger than last year
and the expenses of the regular estab-
liShment, especially Army and Navy,
are higher than before, the statement
issued by the Treasury shows the total
expenditures thus far this month at
315,413,290, as against $647, ,553. .333
at the same time year ago.
There Is no way of knowing how
many Government checks in addition
to the $3l5,4 ,2s0 have gone out from
the Treasury this month, but at least
e240, 100000 may be accounted for
through the use of collection moneys
that are paid out but not now counted |
as expenses. This item alone would |
make the expenses about sa55, 900 900,
which is more nearly like the last
year figure. But even so, this years
figure does not include other trans
actions which appeared in the Treas
ury statement year ago and which
for some reason or other are not
shown up as fully this year.
If the New Deal bookkeepers keep
on with their present scheme they
may be able to show between now and
November rather insignificant def
cit for the present fiscal year, cem-
pared to deficits of recent years. The
cash balance will be used instead of |
new borrowings, and the public debt |
could remain stationary until after |
election.
(Copyrisht, 1881