The Wilmington morning star., 1947-04-25
The Fiscal Program
By ARTHUR KROCK

By ARTHUR KROCK
Observation-Disclosures to do about tax rates
and appropriations is always influenced by
partisan politics and the concern of office
holders to keep their jobs, The methods by
which business men arrive at their fiscal poll
cies are subordinated to these factors when
government deals with the same problem. But
for a cariety of reasons this situation IS now
being handled in a heavier partisan atmos-
phere than usual.
The reasons include these:
l.. A Congress controlled by one major party
and ar executive department by the other.
2. The Republican o%verturn of the Demo-
cratic majorities in Congress followed a cam
paign in which they pledged substantial re
auctions in taxes and the costs OF govern
meat. They have taken the initiative in this
Congress to carry out these pledges. If they
are successful, they will claim the credit and
probably get a good deal of it from the public.
Hence the Democrats have a partisan ami
nation. among others, to put obstacles In
their path.
3. In his budget message of Jan. /, 1947,
the President estimated a deficit of $780,
900, 900 for fiscal 1947, with expenditures at
Some weeks later he said informally to a
press conference that he believed the budget
would be balanced by the end of fiscal l947.
On April 10 he made a formal statement in
which he estimated a surplus Of 81. ESQ, DOC, 600
next July /, instead of the deficit of 81, 300,
900, 000 he foresaw in his January message.
He attributed this to an unexpected drop OF
81, $50, 600, 900 in government costs and a rise
of 81, 500, 600, 900 in receipts-a favorable diff
ference of $3.50, over the estimates Of
ference of So, $50, 600, 900 over the estimates of
January.
But, said the President, good Federal house
keeping still requires that there shall be no
tax reduction, repeating the counsel he gave
Congress when he expected a deficit of ST.
300, 900, 900. Tax reduction, he argued, would
contribute to current inflationary pressures
and diminish. the payment of the huge national
debt that otherwise could, and should, be
made.
4. Very experienced students of the public
revenues, of whom John w. Hanes, former
Under-Secretary of the Treasury, is an ex.
ample, have informed Congress that the ad-
ministration's error of S s, 1850, 600, 600 in Janu-
airy will prove in July to have been much
greater. On the same Treasury figures they
~foresee a surplus of from So, 900, 600. 900 to
81, 900, 00c, 900 by July l, and many in the fl
%nancial world are disposed to agree with
them. The President spoke sighting ely of Mr..
Hanes and his figures, which can be attribut-
W W w GAS AoSG uAoI IL lSL L
ceots them, it will be much more difficult
to prevent tax reduction, and also, of course,
to the further fact that the Treasury has sup
piled Mr.. Truman with a much lower compu-
tation.
alt the Senate Finance Committee has in
v1ta Hanes to present his case before
1t. mi, having been preceded by Mr.. Tru-
mans public admission in April that his Janu-
airy figures were in error by $3.50, 900, 900,
Mr.. Hanes has a good chance to persuade
Congress that they are still 81, 900, 900, 900 or
SO below what the Treasury ledger will dem
onstrate July /.
5. A large majority Of Congress wants to
reduce taxes, though Republican OBJECTIONS
from the leadership stand in the way of COM
mensurate reductions in government costs
urged by Senator Byrd. If this majority can
convince itsef-and then the public-that the
President is opposing tax reduction in any
degree for partisan political reasons, and that
there is even a fair prospect on July l of
MI. Hanes' forecast coming true, it will re-
wise the levies downward. And in all proba-
bility a veto could be overridden, with some
Democratic aid.
~istration has helped greatly to spread these
convictions among the members of Congress.
The continued resistance of the Administration
to tax reduction, and the Presidents uncon-
cealed annoyance with Mr.. Hanes, have add
ed to the belief among the Republicans that
Mr.. Truman counsels delay so that he and
his party can get the credit at a later date
for tax relief that could as safely be given
now.
These events and suspicious have enveloped
our fiscal program in a more partisan po-
litical atmosphere than usual. And that makes
a very bad climate for wise and deliberate
action.
If the Presidents advisers had not induced
him to stand so firmly on his figures of Janu-
ary. and if he had lent any real assistance
to tho effort to make far greater cuts in the
cost Of government, the prospect for prudent,
non-partisan legislative decision on pending
fiscal matters would be much better. If Mr..
Truman, when discussing high prices, had
stressed all the true factors that have pro-
duced them. instead of centering on business
management and tossing out the firebrand
about further wage increases to restore eco
nomic equilibrium, his counsel to Congress
would have more weight.
But for all these causes the President is
being discounted by the Republicans as a can
didate with his mind on reelection, as a
Chief Executive with great responsibility for
the condition he attacks who is trying to
place all of it on Congress and management.
and a., a politician who is trying for delay
so that his side can overtaks the opposition.
New York Times. p