Evening star., 1941-10-18
Three Economy
Plans Offered
ToCongress
But Budget Bureau
Avoids Indorsing
Any Of Them
BY the Associated Press.

By the Associated Press.
The Budget Bureau today told
Congress three ways to make big
cuts in non-defense expenditures
did not recommend any If them
and said the greatest reduction would
hit the Federal work-relief, farm
and youth-aid programs.
The bureau report, prepared in
response to a Senate Finance Com
mittee resolution. said that many
of the indicated downward revisions
would seriously impair the defense
effort and other vital Government
activities"
Saying that the budget could be
reduced only by more economical
Government management, curtail-
ment of economic and social aid
programs or reduction OF existing
governmental functions. the report
disclosed that S450.000,000 of re-
serves" already had been set aside
from appropriations for the l94l-2
fiscal period
This unusually large amount ap-
pears possible in the light of i'm
proved business conditions" the bu-
reau said. "A larger reserve cannot
be established at this time without
a revision of the functions and pro-
grams which are the result of con-
gressional enactments."
Asked for Three Budgets,
Under the Finance Committee
resolution Budget Director Harold
D. Smith was requested TO supply
three budgets showing a non-de-
fense spending reduction for the
present fiscal year of $1,000 900 900,
81 500 900 900 and 81 900 100000
Mr. Smiths report showed that a
50 600. 100000 cut would require a
reduction of 948 per cent in the
aidto-youth program. 1873 per
cent reduction in work relief, q ASS
per cent slash in agricultural ex-
penditures and rs per cent cut i'll
supplemental items among all agen-
cies
For a 81 500 900. 900 reduction, the
cuts would be CTS per cent for AID
to youth, 493 per cent for work re-
lief, AL for agriculture and so per
cent for supplemental items, A
81 900 100000 reduction would pro-
vide cuts of 81. 316, 286 and Is per
cent for the respective items.
Definition Difficult.
The report placed non-defense eX-
penditureS for the present fiscal year
at s6,581 900 900. excluding debt re-
tirement. But it added that non
defense spending was difficult TO
define because many Government
activities affected the defense pro-
gram. 1t was emphasized that the
theoretical reductions should not be
regarded as Budget Bureau recon-
mendationS.
Senator Byrd, Democrat, Of Vir-
ginia sponsored both the resolution
calling for the report and a parallel
proposal. recently approved, setting
up a 14-man committee to study
methods of cutting down non-essen-
tial expenditures. The committee
is expected to begin its work soon,
and to use the bureaus report as a
base on which to work for possible
economies.
Discussing economic conditions
generally, the report said:
The improvement of income and
employment conditions is largely
due to the tremendous increase in
defense production. Various parts of
ny-ia nF
farmers, and various groups of labor
are differently affected by the de-
fenSe effort.
Defense prosperity is spotty in
its effects. There exist side by side
5carcities for some types of labor,
and unemployment for other types.
scarcities of some farm products. ex-
ceSses of others, boom conditions in
certain regions, and slack conditions
in others. Therefore, an improve
ment in agricultural or employment
conditions would not necessarily
justify a corresponding reduction in
farm or relief programs"
But the report added that in re-
cent months the agricultural sit
lioO ollONIl a hCd
provement as compared with condi-
tions at the end of 1910. Influenced
by further increases in domestic
purchasing power and to an even
greater extent by large scale food
purchases for Great Britain, farm
incomes have risen rapidly.
Farm Cuts Possible.
General improvement in farm
conditions, extending to almost all
types of farmers, will permit a sub
stantial reduction of Government
aid at some future time. The words
future time are used because there
Is a considerable interval between
the time when farm conditions i'm
prove and the date when reduction
in farm aid payments is possible"
Almost half of non-defense ex-
penditures are tagged for so-called
fixed commitments" the report
said. These include interest, pen
sions and other items which can not
be cut without the amendment or
repeal of statutes.
In addition. the report indicated,
it would be difficult to reduce i'm
mediately such long-range expendi-
lures as those for reclamation. river
oo5 l,o rIor ,,,lnlic brIiIdinu opd rnod