Evening star., 1953-05-09
Byrd Declares
CongressCan
Balance Budget
Congress Republicans
BoIk at Accepting
Debt Limit Raise
By J. A. O'Leory

- ." - SSSAy
Senator Byrd, Democrat, Of
Virginia, disagreed fatty today
with Treasury Secretary Hum
phrey's view that the Federal
budget cannot be balanced for
the coming year.
At the same time, high-rank-
ing Republicans in Congress
were reluctant to accept the
Treasury Secretary's prediction
that the present debt ceiling of
$275 billion will have to be
raised.
The Treasury head touched off
a new round of speculation about
the budget and tax situation by
his testimony before the Senate
Foreign Relations Committee yes
terday on the $50 billion new
foreign aid bill.
Mr.. Humphreys judgment that
the legal limit on the size of the
debt may have to be increased
also raised new questions as to
what, if anything, this Congress
may do about tax revision.
Committee in Recess.
While this discussion of the
overall fiscal situation went on,
both the House and Senate COM
mittees handling the foreign aid
bill were in recess for the week
end.
II don't believe it will be nee
essary to raise the debt ceiling" :"
said Speaker Martin. 1--WE still
hope that when we get through
at this session things will look
brighter"
Senator Byrd said he is stand
ing by his analysis of two weeks
ago. in which he pictured bal
anced budget for the year start
ing July l by these three steps:
/. Cutting $6.S billion from
the Truman budget. bringing it
down to $71.8 billion of spend
ing.
2. Action by Congress to post
pone $2.1 billion of tax cuts due
to take effect automatically in
the next seven months.
8. Reclaiming about 81 billion
from Government corporations
engaged in businesS-type activi-
ties. These steps would balance
income and outgo at $71.8 bill
lion.
Deficit Looks Worse.
AS Senator Byrd was speak
ing, the Associated Press re-
ported that the latest figures
by responsible Treasury officials
on the probable deficit as of
June 30 will be not less than
$6.5 billion and possibly as much
as $8.5 billion. President Tru-
man had figured the deficit at
$50 billion. If this trend is
borne out it will require greater
economies than Senator Byrd
figured on when he prepared his
estimates.
The difficulty is that the excess
profits tax is due to expire auto
matically in about six weeks. on
July /. If it is to be postponed.
action would have to start in the
House within a few days.
Senator George of Georgia,
ranking Democrat on the FL
nance Committee, does not be-
lieve any tax bill can be con-
Sidered before October, after all
of next years appropriations
have been acted on. He also
believes, however, that if Con-
gress wanted to do so it could
take action in October, extend
ing the excess profits levy retro
actively from July /.
Tax Cut in Doubt.
The II per cent increase in
individual income taxes adopted
in 1851 is due to expire Decem-
ber 81. Some House members
have been trying to repeal at
least part of that tax earlier,
but their chances do not appear
bright.
One influential Republican
Senator agreed today that if
some action becomes necessary
at this session, it would be bet
ter for the Republicans, polit-
ically, to extend the excess prof.
its tax than to have that business
levy expire six months before
individuals get tax relief.
Mr.. Humphreys testimony
yesterday was in closed session,
but portions of it were made
public by Chairman Wiley, who
quoted the Treasury Secretary
as saying:
Although I am distressed that
we cannot balance the budget
this year, I do not believe it
should be balanced this year.
The risks that would involve in
our security would simply be too
great"
AS of yesterday the Treasury
statement showed the national
debt now totals $265.5 billion,
or within less than $40 billion
of the present legal limit.
Mr.. Humphrey testified that
the difficulty in cutting the
budget flows from the fact that
more than IS per cent of the
expenditures are for security,
and about half of the remainder
for fixed charges. He said that
leaves only about Is per cent of
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