The Washington times., 1936-01-10
CUT SPENDINGS,
STOP DEFICITS,
HANEY URGES
~ LEWIS HANEY
(PrOSeseoe Of Eesnemios, New York
University

UMNeHBhVD
The excitement over the AAA
debacle has drawn attention away
from the Federal Budget situa-
ton. Nevertheless, the problem
Of the unbalanced Federal budget
% the vital one.
Many people diSnias the ''bud-
get" 90 being . mere matter Of
figures. They think Of It ~ .
cold mathematical proposition.
A. q matter o. fast, II virtally
touches Ms al ii our everyday
lives, and the unbalanced bud
get d the Sign and symbol Of
most IL the ills that now beSet
10. Z,
The unbalanced budget stands
for waSteful experiments, for
bureaucracy, and for most Of the
uncertainty which lays It's deadly
hand on business. IN fact, 1t
stands for the great evil Of unem-
ployment:
II we would balance the Fed
eral budget, the politicians ct
washington would not be able to
buy silver, speculate in cotton,
and sink our funds In such waste.
full things as the Grand Coulee
and PassAmaquoddy dams. The
army Of Federal bureAucrats who
feed ON our public debt would
have to 70 back home.
Above al, we could have some
assurance concerning initiation
and the future purchasing power
Of our money. This would start
Q big increase Ii investment and
business plans, which would soon
make productive employment 100
millions 81 people. ...
You see, as long Is the Govern.
1nent has to borrow, with the pub
lie debt 90 huge, people viii doubt
that it will ever pay In full. It
Is regularly running on deficit,
and borrowing about half what
It spends.
The Roosevelt Administration
has been able to do this by forcing
the banks to take its promises to
pay. Over 80 per cent Of its debt
b carried by banks. And over 50
per cent Is In the dangerous shape
Of Shortterm promiSeS-noteS,
bills, and certificates. This Is a
bad financial situation. and It
holds industry and employment IN
check.
Balancing the budget would
not mean letting the needy
starve. In fact. it would do
more to put people back to
work. than anything else.
More than that. we could and
should make ample provision In
the budget for direct relief for
the needy. The, budget should
provide half . billion dollars to
advance to the States, On condi-
ton thAt they put up a like
amount. That would provide Q
billion dollars for direct relief.
In addition, half . billion could
60 for the SoCnder public works
for which commitments have been
made.
But We could and should lop off
5000 million dollars OF the spend.
ing for WPA, farm benefits"
emergency conservation credit
advances" and all that sort Of
stuff.
That would balance our budget,
and It Is the only way short Of
drastic increase In taxes. Stop
wasteful spendingl
Some people say let's balance
e by issuing billions Of paper
money. But that - not balanc-
ing anything. Either the paper
n Government debt (nOtOS) OF
It isn't. II &c Isn't Government
debt, then it II no COED. II It b.,
e Just increases the debt.
What these infIationiSts want is
really to force the Government to
repudiate It's debt by issuing worth
less promises to pay. These would
fall in purchasing power. Thus
the debt would b reduced" by =
fraud on its citizens. That Is re.
pudiation.
Mr.. Roosevelt clings to the
idea Of balancing the budget some
time, but his grasp u weaken.
ing. He talks about reducing
the deficit" and approaching Q
balanced budget" But Is long
as there Is any deficit, the debt
will grow, and we can approach"
q balance all our lives and never
get there!
His last budget message Is .
pitiful performance. (Have you
read .it?) He admits that he
does not know what his expendi-
lures are going TO be. He says
that he hopes that the deficit
may be no larger next year. But
that is al.
In view Of the Topping off Of
Illegal processing taxes, ana the
coming soldiers bonus" he is
not likely even to do any
approaching"
It is certainly high time for
us to revolt against that kind
of democracy which spells DEBT.
If we want honesty and efficiency
in government, and recovery and
employment In industry, we must
balance the budget. Why not do