Downs & Ups

Into the Press last week President Roosevelt dumped a basketful of figures in the form of an off-schedule revision of the Federal budget for fiscal 1937 (June 30, 1936-June 30, 1937). Republicans and Democrats promptly began tossing billions at each other's heads in a fierce dispute over the figures' answer to a prime question of the Presidential campaign: Is the New Deal planning to spend as freely in the future as it has in the past?

Income. The Supreme Court, by invalidating AAA processing taxes, and Congress, by voting the Bonus, severely dented President Roosevelt's budget estimates of last January. Loss of processing taxes cost the Government $452,000,000 of anticipated revenue. Exclusive of that loss, receipts for fiscal 1936 were $157,000,000 more than the President estimated in January. Total receipts: $4,115,956,615.

Receipts for fiscal 1937, the President reported last week, would be an estimated $5,665,839,000--$12,000,000 over his previous estimate--in spite of a $668,000,000 loss of AAA and Bituminous Coal Conservation Act taxes and a deferment of certain Social Security Act collections. These losses would be more than offset by $410,000,000 in additional funds from the Revenue Act of 1936; $33,000,000 in delayed collections on the Railroad Retirement Act; and a jump of $237,000,000 in general revenues because of better business.

Outgo-In fiscal 1936 the Government spent $8,879,798,258. That was far over his January estimate, said the President, because Congress had tacked on $1,674,000,000 for the Bonus. If it had not been for that, he would have spent some $439,000,000 less than was planned.

Estimated expenditures for fiscal 1937 were set at $7,762,835, 300. Only$560,000,000 would be needed to finish off Bonus payments, and less would be spent on the Veterans' Administration, War Department, CCC, and recovery & relief. As for increases, $405,000,000 would be required for Social Security and expenses for AAA, debt retirement and interest on public debt would be up. In addition, the sum of all other expenditures would be $448,986,000 over 1936. chiefly because of public works and national defense. Finally, the President dangled a figure left out of his regular columns. If the Drought's aftermath was as bad as anticipated, or if private industry failed to take enough men off relief rolls, he warned, he might have to ask Congress to add an extra $500,000,000 for relief to his total figure.

Balance. By the President's figuring, the Government's deficit for 1937 would be $2,096,996,300, against $4,763,841,642 for 1936. And all this deficit, said he, would not be added to the public debt. Because of overborrowing for the Bonus and relief, the Treasury had started fiscal 1937 with an enormous working balance of $2,225,112,350. It was planned to spend enough of this during the year to bring the balance down to about $1,100,000,000. And the Treasury would borrow only $750,000,000 of new money. Therefore the public debt, which rose $5,077,650,889 last year, would this year be upped only $410,000,000--smallest increase since the beginning of Depression.

Trouble Chest. Of the $750,000,000 of new financing which the President mentioned, Secretary Morgenthau last week announced that the Treasury would borrow $400,000,000 on Sept. 15. It was seeking that much right away, he explained, chiefly because the Administration had decided to keep a cash balance of around $1,000,000,000 on hand in case of trouble (i. e., war) abroad.

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