Evening star., 1944-01-14
Victory Budget

Victory buo9et
The Presidents victory budget"
commits the Nation for the second
consecutive year to an expenditure
of approximately 500 billion, and
brings US to the point where we may
anticipate Federal debt Of $258 bill
ion at the end Of the coming fiscal
year. This means that the United
States is going to be saddled with
staggering debt for years If not
for generations to come. and 1t calls
for sober thought In the matter of
Federal financing.
In his budget message, Mr.. Roose-
velt made the rather restrained OBJ
servation that wartime spending
leaves its legacy of postwar debt"
This, of course, Is true, and 1t cannot
be avoided. But we need to remem-
ber that we also had legacy of debt
in each OF the ten years prior to the
war, and II present indications are
reliable guide we will have recur-
ring deficits after the war is over.
We are becoming conditioned to the
broad but artificial prosperity which
results from the expenditure OF
billion dollars by the Government
every three or four days. When the
war is over the need for most Of this
spending will disappear, but 1t Is
going to be difficult to reduce ex-
penditures accordingly. New demands
for new undertakings, all at Govern
ment expense. will be heard from
many quarters. and it will not be
easy to resist them. We have been
exposed to a growing national debt
for so long that figures have begun
to lose meaning. When peace comes
and war prosperity disappears, it will
be hard to resist the temptation to
add a few more billion here and
there to a debt that has already
climbed to $258 billion. It will be
easy to- say that, being in so deep, we
might as we'll 60 a little deeper.
In this situation it might be useful
now to turn back to some of the
Presidents earlier statements on fls-
cal affairs, not in any invidious spirit,
but because what he said was true
then, is true now, and will be even
more true in the future. A little less
than eleven years ago the President
warned Congress that "too often in
recent history liberal governments
have been wrecked on rocks OF loose
fiscal policy" Five months earlier,
in an address at Pittsburgh, he noted
with grave concern that the COM
bined annual expenditures of all
three branches of government-Fed-
eral, State and local-had risen from
three billion dollars in 1913 to nearly
thirteen billion dollars in 1928.
Come easy, go easy, was the rule"
he said. ut was all very merry
while it lasted. We did not greatly
worry. We thought we were getting
rich. But when the crash came, we
were shocked to find that while in
come melted away like snow in the
spring, governmental expense did
not drop at all" That, Mr.. Roosevelt
said, was a perfectly impossible
economic situation" And yet that
was back in the days when the ma
tional debt was about twenty billion
dollars.
These thoughts are worth recalling
as we stand today on the threshold
Of debt which soon will climb to
258 billion dollars. For while we
cannot escape today's enormous ex-
penditures because we have war to
fight and win, there are some things
that we can do.
Congress can heed the Presidents
request for higher taxes to defray a
greater portion Of the wars cost
now. The stabilization line can be
held to prevent rising prices from
adding unnecessarily to the cost of
victory. The essential parts of the
renegotiation statute can be kept
intact so that the Government will
not be gouged in its war contracts.
And, while we are planning elaborate
postwar programs, we can ask our
selves when, If ever, we are going to
live within the national income.
Unless these things are done we
assuredly may expect to pile up on
those rocks of loose fiscal policy
which Mr.. Roosevelt warned against
in March of 1888.