Evening star., 1945-01-09

now is that of replenishing equip
ment and supplies and of providin
our fighting men with the most up
to-date weapons which can be con
l trived. Some weapons of which W
had sizable inventories only a fey
r months ago must now be produce,
! in increased quantities. More thai
{ e-fourth of present war produc
ton is in critical items. Untimel,
relaxation in war production SPELL
, greater sacrifice in human lives anC
, delays victory.
!, Expenditures for pay and sub
, sistence of the armed forces still ar,
; increasing because of the higher pay
for larger number of soldiers anc
, sailors stationed overseas. Expendi.
lures for mastering -out payment!
, are also increasing as a result of thu
/ considerable turnover in our forces
The war expenditure estimate fol
the fiscal year 1916 also provides fol
/ continuance of subsidies paid out ol
funds of the Reconstruction Finance
: Corp. to assure war output and tt
stabilize the cost of living. It ex-
cludes payments of the Department,
of Agriculture for the farm price
support and related agricultural
, programs which are discussed else
where in this budget.
No allowance is made either fol
possible addition of new subsidy pro.
grams or for discontinuance or re-
ductlon of existing programs, al
though hope that a reduction will
become possible. In accordance with
legislation enacted by the last Con-
gress, I shall submit detailed rec
concentrations for these programs
at later date.
War Costs Should Decline
During 1916 Fiscal Year.
War expenditures are expected to
decline in the fiscal year 1916; our
war construction and initial military
equipment are substantially COM
plete, and our supply lines have
been filled. The extent of that de-
cline depends on the course of the
war. The composition of war ex-
penditures will change considerably
in any case.
There has been overoptimistic
speculation about the possible cut
in war expenditures when major
hostilities in Europe end and our
main efforts are concentrated on the
japanese campaign. We should
make great mistake if, in our mill
tary and budgetary planning. we
underestimate the task of defeating
Japan. Japan now occupies twice
the area which was held by the
Nazis in Europe at the peak of their
power, an area as large as the con-
tinental United States. The popu-
lation now under Japanese control
is more than three times the popu-
lation of the United States.
The supply lines to the Pacific
and Asiatlc theater are two and
three times the distance to Europe
and the turn-around time for ships
has been two-thirds greater. As
the battle against Japan mounts
more cargo will have to be shipped
over greater distances.
Our task in Europe will not end
with the cessation of hostilities
there. The war will not be won
unless we accept our share of re-
sponsibility for the administration
OF occupied territories and for relief
and rehabilitation in the liberated
areas. Expenditures for these tasks
are part of the war budget.
The uncertainties of war require
that the budgets of the military
agencies be sufficiently large and
flexible to permit them to meet all
demands that may arise. Adequate
appropriations and contract au-
thorizations enable the war agen-
cles to make commitments and to
place procurement contracts far
enough ahead for industry to plan
the various stages of production.
On the other hand, we should, of
course, also be prepared to adjust
our war programs downward if the
development of the war allows.
Unliquidated War Obligations
Drop From 100 to 66 Billion.
The Congress has placed admin
lstratlve controls in the executive
office of the President by granting
authority, under legislation expir-
ing June 30, 1945, to limit personnel
in the Federal agencies and has
reinforced them by requesting re-
ports on unobligated balances of
war appropriations.
There is considerable time lag
between the legislative authoriza-
ton or appropriation for war sup
ply, the obligation or placement of
orders with contractor. and the final
payment on delivery of finished
munitions. The huge authorize
tions and appropriations voted by
the Congress in the early years of
the war enabled the war agencies
to place munitions contracts tor
later delivery. We are now paying
for deliveries under these contracts
Unliquidated obligations for the
war program totaled 100 billion
dollars at the beginning of the
fiscal year 1914; they had been re-
duced at the end of November, 1914,
to about 66 billion dollars by pay
ment or, in some cases, by cancella-
ton.
Appropriations and authorize
tions for war purposes, in the gen.
eral and special accounts, for the
fiscal year 1914 were 100 billion
dollars. For the fiscal year 1945
they declined to IS billion dollars
and for the fiscal year 1916 are now
tentatively estimated at 73 billion
dollars. These totals include re-
appropriations and contract au-
thorizations required for new obli-
cations. The total war program
measured by such appropriations
and authorizations, together with
net commitments of Government
corporations for the fiscal wears
1941 through 1916, will total 45C
billion dollars, as shown in the
following table:
THE WAR
| Gin B