Evening star. [volume] (Washington, D.C.) 1854-1972, 1939-12-26
Economy Ak Peri|ed
Il Past Record Is
Any Guide
Election Year Psychology
May Work Against
New Tax Bill
e, the Associated Press.

Members of Congress are talking
now about cutting down Federal ex-
penditures, but if past performance
is any guide, the economy ak may
be gathering rust before the first
1904 appropriation bill goes to
the White House.
Various Senators and Representa-
tives, awaiting the opening of the
new session January 3, are contend
ing that a start should be made to-
ward balanced budget, that relief
expenditures should be curtailed
substantially, that Congress should
employ a budget officer to help it
whittle down administration spend
Ing estimates, and that President
Roosevelt's projected record defense
program should be reduced.
But, when voting time comes. it
may be different story. Repeated
ly in the last session, bipartisan
economy bloc fought for reductions
In pending measures. Usually it was
beaten, and Congress finally topped
administration budget requests by
e19O.8OO,OOO.
Because 1910 is an election year,
there may be many members who
will hesitate to vote against bills
carrying funds to be spent in their
States. And almost every major ap-
preparation measure has something
for every State.
May Balk New Taxes.
The election-year psychology also
Is expected to operate against enact
ment of any new tax bill. Besides
the general unpopularity of taxes
among the voters, members of Con-
gress will be wanting to get away
from Washington for the national
political conventions and will be re-
luctant to give attention to time
consuming revenue legislation.
The President has declared that
Congress owes the Treasury $780,
100000 for extra farm benefits al
ready appropriated but not financed
by taxes.
Mr.. Roosevelt probably will sug-
gest enactment of farm benefit levies
in his annual message to Congress.
but the farm bloc is expected to OPP
pose them-aS it has in the past
on the ground that no tax provision
has been made for other deficit ex-
penditures.
Taxes on War Profits.
There has been talk of enacting
war taxes to take part of the profits
which American business reaps from
the European conflict, but these. too,
may be forgotten in the general ef-
fort to wind up business early.
Many persons both in Congress
and the administration are hopeful
that improved business conditions
will do much to narrow the gap be-
tween Federal income and outgo in
the fiscal year beginning next July
/. Budget authorities are forecast
ing a 100000 900 deficit for that
year, compared with a probable
deficit of about $4,000, 0OO,O 900 for the
current year. Expenditures for the
next year are set tentatively at
about $9,250,0OO,0 00-only $3.50 0OO,-
600 less than those for this year.
Move for Defense.
Mr.. Roosevelt may request an ad-
ditional $5OO,0OC,0OO for national de-
tense, but is seeking to make this
up in reduced appropriations for
other governmental purposes.
One big complication in the Fed
eral fiscal picture is the present
S45 900, 100000 limitation on the ma
tional debt. The debt now stands
at about $41, OOO,0OO,OOO, and Con-
gress must decide whether to raise
the limit, increase taxes, or sharply
reduce expenditures.
There have been some suggestions
that the debt limit be increased to
a level only sufficient to compensate
for the projected deficit in the COM
ing fiscal year. Supporters of this
idea argue that it would tend to
restrain Congress from voting ap-
preparations in excess of estimated
revenues.