Evening star., 1947-08-21
5-BiI|ionSurpIusSpurs
New 6. 0. P. Demand
For Income Tax Cut

A new Republican cry for tax
reduction arose today as Presi-
dent Truman predicted a Treas
ury surplus of nearly IS 100000
900 next June 80, when the
current fiscal year ends.
Making public last night re-
vision of the January budget fol
l94S, in which savings of more than
$1,000, 100000 claimed by the COP
were shaved to about a fifth OF
that figure, Mr. Truman emphasized
that foreign relief and liquidation
of the public debt continued to take
precedence over tax-cutting in the
Administrations fiscal policy. In
fact, the prospective surplus is con-
tingent on spending abroad.
Referring to President Truman's
two vetoes of Republican tax bills
which would have saved the Amer
ican public $4,00Q000,0 Chairman
Bridges of the Senate Finance Com
mittee told the Associated Press in
Fall River, Mass, that the new
budget figures prove that the coun-
try was robbed of tax reduction
by purely political vetoes."
He added that perhaps the
President now will not be so de-
termined about vetoing tax reduc-
ton bill when it is presented to
him"
spoRt;eaI Nave Attacked
Representative Taber, Republican,
of New York, chairman of the
House Appropriations Committee,
said in Auburn, N. Y, that the
people are entitled to tax relief
as a safeguard against choking off
production and squirting initiation.
Seator Young. Republican. OF
North Dakota called the Presidents
assertion that the, Republicans had
saved-at the outside-about 81 ,500,-
600, 900, a political" move. He saw
it as "an attempt TO delude the Ma
ton into believing that the Repub-
licans are incapable OF carrying out
an economy program"
In another statement Senator
OMahoney, Democrat, OF Wyoming,
noted that the Government pays
$4,000, 900 900 interest annually on
the national debt, or more than
the entire amount appropriated for
social welfare, general government
expenditure and; the development OF
national resources.
This makes it obvious that the
best way for the Government to
economic is to reduce the annual
payment of interest on the national
debt by reducing the debt itself.
That's why President Truman Is
right in recommending that the
surplus be applied to the debt in
stead of to the reduction of taxes.
Tax legislation should not be
adopted to reduce Government re-
ceipts, but We should have tax
reform to encourage the investment
of private capital in free competi-
tive enterprise" O'Mahoney said.
The budget statement, issued an
nually in midyear, was silent on the
subject of tax reduction, but there
was one section which indicated
clearly that there was no likelihood
of an early change in the position
of the President who told Congress
in rejecting the tax reduction pro-
gram that it would be harmful to
the country under present circum~
stances. (The January surplus esti-
mate was only $202 2,000,000D
Truman Stresses Balanced Budget.
Recalling that the budget was bal
anced in 1947 for the first time In
II years. Mr.. Truman said:
LAS long as our total postwar COM
mitments are still uncertain, and as
long as We are under strong inf1a-
tionary pressureS, it would be reck-
less not to include a reasonable sur
plus in the budget. In the light Of
present conditions, the estimated
surplas of $4.700,0 100000 (actually
S4.667 .0O0,0 ,000> for the fiscal year
1948 is essential to sound fiscal pol
icy The surplus, together with part
of the present cash balance, will be
devoted to retirement Of the pub
lie debt.
The same prudent policy of plan
ming for a surplus and for further
debt retirement will be followed in
preparing the budget for l949 The
strictest economy consistent with
the Governments obligation is i'm
perative. l have already instructed
the executive departments and
agencies to hold their 1949 budget
requests below the 194S total. In.
number of cases. I have established
certain definite limitations.
Saving Claims Disputed.
While Senator Bridges estimates
savings of the Republican-controled
S0th Congress at S7.181000,000, and
House Majority Leader Halleck
stands on S4,484 100000, President
Truman put the maximum at ST.
52O.O00,0O0. This. he said. actually
has been reduced to 1928 900, 900 by
later appropriations.
Further. while the President gives
Congress a pat by conceding that
some constructive readjustments of
the budget have been made" and
adding that the Congress has ac-
cepted many of my recommended
tons on urgent domestic and inter-
national problems he said that
some important services have been
reduced or eliminated spells
these out:
National defense appropriations
were cut by $566, 100000, with re-
sultant reduction of $453 100000 in
expenditures. This, he added will
mean substantial cuts in the num-
ber of military personnel and con-
siderable contractions in the supply
services" which are offset partly by
increases of 1924 900 900 in appropri-
stions and contract authorizations.
Veterans Services Cut.
Veterans services and benefits
cut by 100000, entailing $50
100000 reduction in pension esti-
mates and $17,0C0,000 for educa-
tional facilities,
International affairs cut $685.
600, 900, including a $4,000, 900 slash
"in the foreign information and cul-
tural program-a reduction which
impairs our efforts to give other
peoples accurate information about