Evening star., 1953-09-22
Byrd AssaiIs RumI's
Budget Reform Plan
As Fiscal Illusion
By Robert K. Welsh

Beardsley Ruml'S plan for Fed
eral budget reform and tax re-
duotion crashed headon today
into the opposition of Senator
L, Byrd, Democrat. of Virginia, who
denounced it as phony, mislead-
ing, a hoax and an open invita-
'tion to creeping socialism.
The Virginia Senator. an .au-
thority on governmental finance
and a frequent critic Of New Deal
or Fair Deal fiscal policies, de-
'clared the Ruml recommended
tions to the House Ways and
Means mittee contain
"threadbare budgetary subter-
fuges" that the New Dealers
themselves cast aside.
Mr.. Ruml, originator of the
pay-as-you-go income tax ar
.rangement, told the House COM
mittee last month that the Fed
eral Government could end most
excise taxes and cut others if 1t
scaled down estimated revenue
requirements and adopted vari-
Gus budget procedures. He de-
clared this could be done without
levying a Federal sales tax, in
creasing present levies, or con-
tinuing those due for reduction
or repeal next year.
Letter to Reed.
Senator Byrd, in a letter to
Representative Reed of New
York, chairman of the House
committee, said he appreciated
Mr.. Ruml's patriotic contribu-
tions of the past" But the Vir-
ginia member attacked his cur
rent proposal by charging:
1T would result in no expend1-
ture reduction. 1t probably would
result in increased expenditures.
The only way it could justify
even partial and temporary tax
reduction would be by increasing
the debt and destroying the &C
tuarial validity of savings by
millions of people against their
old age, for which the Govern
ment is trustee.
1T would remove from public
view and congressional review
many of the more colossal Fed
eral programs and projects, cost
ing billions of dollars annually,
which just now are being in
creasingly disclosed in the Fed
eral budget"
Little Consideration Seen.
Ways and Means Committee
members, currently working on
a proposed revision of the Fed
eral tax code, indicated today
that the Ruml plan has not fig
ured prominently IN the study.
In any event the blast by Sen
ator Byrd is believed to have
seriously cramped whatever
chance it had of adoption by
Congress next year.
The main point in the Ruml
plan is that the present method
of preparing the Federal budget
overestimates the revenue re-
quirements by $12 million be-
cause of: 49,
l. Lack of efficiency and econ
omy, which is costing 50 billion
q year.
B. Inclusion of 50 billion of
capital items such as Govern
ment loans, Stockpiling payments
and surplus purchases, and list
ing them as Government ex-
penses when in reality they are
"revenue-producing assets"
3. Inclusion of 81 billion Of
Federal investments which could
be organized on a Self-flnancing
basis. Such investments include
Government owned property,
construction and atomic energy
plants.
4. Inclusion of 81 billion which
could be saved" by adopting a
so-called consolidated cash budg-
ct. Such a budget would list So
cial security premiums as tax
revenue.
Sees Fiscal Illusion"
Senator Byrd said he yielded
to no one in his desire to re-
duce expenditures, taxes and
debt.
But it cannot be accomplish
ed by fiscal illusion fabricated
from fallacy, subterfuge and ex-
ploitation Of the sovereignty of
the United States Government"
he said.