The Waterbury Democrat., 1938-10-20

10000 e. M. white collar employees Are part of the general picture of a hroadeninR recovery base which many observers link directly to in- creased federal spending.
 There are persons among both friends ana enemies of the New Deal who find 1t significant that the ioST-Sg depression coincided with g slackening of government spending and that the current business up- turn follows close behind Q re- sunptlon of pump-priming. The pump -priming is directly affecting treasury figures is indicated by the ccmparison of october figures for 1888 and 1887.
 Increase Of Spending
 One year ago President Roose- veit still was in the process of applying economy brakes. The IF day increase in spending, receipts ana rross deficit in october, 1883, compared with october, 1887, show that the administration is trernend- ousiy increasing the expenditure rate tlnis wear. Here are the figures:
 Oct. I.17, Got. 1-17,
 1888 1887 Spent .... 4S4,000,000 $2e9, 900 900 Receiuts l65, 100000 iSl,000, 1000 Gr'ss deficit 26e, 100000 108,000I000
 Those figures show that the treas ury is taking in less money this month than year ago but is spend- Ina 1t much more rapidly. For that reason the deficit is moving far beyond last years figure and the national debt consistently IS es- tablishing new record high.
 The works Progress Administra- ton alone has put out more than $600, ,000,o00 so far in this fiscal year almost twice as much as Q year ago. It spent $ll0,000,000 in the first 1T days of october compared with S53, 100000 from October to i7, inclusive in 1887.
 Accelerated Recovery AS business reacts to treasury spendinR. some New Dealers see prospects of accelerated recovery Secretary of Commerce Roper be- lieyes increased automobile ems pioyrnent will tend to broaden the recovery base, which means that in. creased automotive employment will reduce relief rolls on the one hand and increase business turnover and tax revenue on the other.
 The fact that the budget remains far out of balance, challenges the treasury and MT. Roosevelt. They hope that increased business activity viii swell tax revenue andn sub- stantially reduce the deficit spread by a year from now.
 Another remedy may be found in higher tax rates. Some congress sional experts believe higher rates on middle and lower bracket in- comes are likely. Processing taxes would be a natural new source oi revenue.
 Business Incentives
 The treasury, also, is studying several types of business incentive taxes. one suggested would give tax advantages to a business which undertook unemployment and plant extenSlOu. IIlhG ullBHb Cut ohSS, tax return from that bushes sbut would be expected to increase gen. eral business activity and to in- crease overall tax collections.
 Meantime, despite an increasing deficit and record breaking national debt, the United States apparently looks comparatively safe to foreign CTS. The governments monetary gold stock has hit figure approxi. mately $l4,000, 100000, close to 5i per cent of the worlds total none. tary gold stocks. The gold hoard has increased more than $l,200, ,000,. 900 in the past 12 months. This in. crease consisted largely of fright. ened money flying from Europe tt comparative safety here. Another factor in demonstrating American fiscal stability is the treasury's strong cash position. Secretary oi Treasury Morgenthau's working bal. ance is $2,l30,943,699.