"Further resolved, That copies of this resolution be sent to Hon. John B. Kendrick, Hon. Francis E. Warren, and Hon. Frank W. Mondell, Senators and Representative in Congress from the State of Wyoming, and to State and national headquarters of the American Legion that all may be advised of the sentiment of Cheyenne Post No. 6, that a bonus for past services is neither needed nor desired and that any appeal for a bonus is felt to be not only doubly unpatriotic at this time but is directly contrary to the spirit and precepts of the American Legion."

STATEMENTS FROM GOVERNMENT OFFICIALS-PAY TABLES. THE SECRETARY OF THE TREASURY, Washington, October 11, 1919.

Hon. JOSEPH W. FORDNEY.

Chairman Committee on Ways and Means,

House of Representatives, Washington, D. C. DEAR MR. CHAIRMAN: Inclosed herewith is a copy of the statement which I delivered to-day before the Select Committee on the Budget of the House of Representatives. I should like to call your attention particularly to the views which I have expressed on pages 8 to 10 as to the present agitation for bonuses for soldiers and sailors. Some of this agitation, as you know, is reflected in bills which have already been introduced in the Congress.

I trust that the views of the Treasury on this subject will commend them. selves to you and the members of the Committee on Ways and Means.

Very truly, yours,

CARTER GLASS. [Excerpts from statement by Secretary Glass on the budget, delivered before the Select Committee on the Budget of the House of Representatives, Oct. 4, 1919.]

To-day the credit of the United States is imperiled by projects initiated and supported on the floor of Congress with a view to capturing the so-called soldier vote. I do not believe for a minute there is any such thing as the soldier vote. I do not believe that that magnificent body of strong, brave, lusty young men who went out to France, or were ready to go, want to see the people of the United States exploited in order that each of them may receive a donation. I do not believe these fine young men, if they realized what it is that is proposed in their behalf, would accept a gift made at the expense of their fathers and mothers and sisters and the children that are to come after them in order to give them a holiday. While, of course, you can not commit to terms of money the value of the service rendered by the Army of America, I call your attention to the fact that the actual pay of our soldiers was doubled at the outset of the war; that our soldiers have been paid with liberality never dreamed of in the history of this or any other country; and that the projects now advocated so lavishly and with so little regard for the welfare of the American people are not limited to those heroic men who suffered injury or death at the hands of the enemy, not even to those who actually saw the front, not even to those who were sent to France. These projects extend to everyone of some 4,500,000 men, mostly young men, who were included in the military and naval forces of the United States, even to those of their number who sought and obtained employment of a character which would relieve them from being exposed to personal risk.

It has been the disheartening task of the Treasury to examine scores and scores of bills drawn and presented with a view to benefiting a section of the country or a portion of its citizenship at the expense of the whole. Many of these bills were apparently devised to avoid the appearance of an appropriation by requiring the Secretary of the Treasury to issue bonds, notes, or certificates of indebtedness to meet the expenditure involved, and all of these bills were such as would not be reached by a purely executive budget.

I have said the finances of the United States are in excellent condition. I have said, in substance, that I do not anticipate a deficit in the current fiscal year in excess of $1,000,000,000, and that that deficit is covered by deferred installments of the Victory loan payable within the fiscal year. I have said that there need be no more Liberty loans. But I say to you in all solemnity that if a prompt and immediate halt is not called to this great peril there must be another Liberty loan, and you gentlemen will have to go out to the people of the United States and call upon them to subscribe for bonds, the

proceeds of which are to be given away to the well and strong young men who you and I and the American people know went out in a spirit of unselfishness-not one of self-seeking-to fight for their country. You may ask the old men and the widows, the school children, the rich and the poor, who responded to the call of their country to the number of 20,000,000 during the period of the war, to respond again to this call for a donation. I hope I shall never shrink from the performance of any public duty, yet I do not covet the task of making such an appeal, and I shall not willingly be a party to offering this affront to the generous, heroic, unselfish Army and Navy of America that saved the freedom of the world.

The Congress may propose to pay this gift in bonds themselves, but that should not fool anyone. If bonds are given away to the soldiers, the issuance in that manner of those bonds will depress the prices of existing bonds so gravely as to imperil the credit of the United States and force additional sacrifices from the 20,000.000 people who participated in financing the war, in providing the pay, food, and munitions which made it possible for our splendid Army to contribute decisively to the great victory.

MCADOO, COTTON & FRANKLIN,

New York, March 24, 1920.

E. W. CAMP, Esq..

Clerk Committee on Ways and Means,
House of Representatives, Washington, D. C.

DEAR SIR: Replying to yours of the 20th instant, I take pleasure in sending you copy of Mr. McAdoo's statement of March 4, 1920, to which you refer. Yours, sincerely,

E. D. FLAHERTY, Secretary.

NEW YORK, March —, 1920.

It seems to me, said Mr. McAdoo, that the time has come for a substantial reduction in the burden of taxation laid upon the American people. We spent $32,000,000,000 in the war, and we paid a larger portion of it in cash than any nation ever paid before. We raised through taxation, in fact, nearly one-third, not simply of the net war debt after loans to Allies had been subtracted but of the gross amount of our spending. According to rational standards of national finance, it would have been enough to raise 25 per cent by taxation.

I think the present generation could with perfect propriety hand on to posterity the ultimate settlement of a larger part of our war debt than has already been funded.

The financial policies of the Nation as embodied in future congressional legislation should realize the utmost economy in expenditure and might well fund in long-term bonds $1,000,000,000 per annum for two years of the amount now raised by taxation.

This might be done without substantial increase in the Nation's debt, which the plan seems at first glance to involve. Under the laws a tax to establish a 1 per cent sinking fund to retire bonds now outstanding is to be collected beginning with the fiscal year 1921. This might well be postponed for at least two years, and thus reduce the tax burden by $250,000,000 annually. There, too, is the debt which Europe owes us and which now amounts to about $10,000,000,000. If the economic restoration of Europe had proceeded far enough so that Europe could now pay interest on this debt-as she should be able to within a few years we should have an income of $500,000,000 from this source. But that is not now available. Why not fund that amount against the day when it will come back to us? By postponing for two years the establishment of a sinking fund and funding the deferred payments of European interest, we should cover $750,000,000 per annum of the $2,000,000,000 by which our taxation might be reduced. By discontinuing purchases of Liberty bonds for retirement under provisions of existing law, the Treasury would be relieved of a large burden now reflected in the floating debt and which otherwise will have to be made up by taxation. It would seem that reduction of our tax bill for the next two years in this manner could be accomplished, and that it would involve the issuance of additional bonds over a period of two years to the extent of probably not more than one and a half billion dollars. Of course, these are mere suggestions and are not intended to outline an inflexible plan.

173925-20-49

I trust that the Ways and Means Committee of the House of Representatives, in which all tax measures must, of course, originate, will consider this question in its broad relations to our general economic welfare. The immediate burden of taxation is too great. It is having an injurious effect on business. It is a contributing factor of large proportions in the high cost of living. Its inevitable tendency is to stifle new enterprise and to throttle initiative. It is both unscientific and inequitable. In view of the approaching decline in our export trade, with the inevitable reduction in the volume of business in the country, it will become doubly important to revise and to reduce taxation in order that business may not have to carry an unnecessary tax burden throughout this period of readjustment.

To the CHAIRMAN COMMITTEE ON MILITARY AFFAIRS,

WAR DEPARTMENT, Washington, July 28, 1919.

House of Representatives.

SIR: Relative to H. R. 393, a bill granting to all members of the military or naval service in the present war six months' pay, subject to deduction for bonuses heretofore received, which has been referred to the War Department for remark, I beg to inform you that primarily the object of bonuses for discharged service men is to provide means whereby they can be taken care of until such time as they can obtain employment or become established in business. The great majority of these men have already been discharged and have obtained positions. It is roughly estimated that it would require an appropriation of $1.000.000.000 to pay the bonus provided in the proposed bill. The payment of a bonus as large as that provided in the proposed bill would encourage idleness among a certain class of discharged service men. For the reasons stated above the War Department does not feel justified in recommending that the bill receive favorable consideration.

Respectfully,

NEWTON D. BAKER, Secretary of War.

To the CHAIRMAN COMMITTEE ON MILITARY AFFAIRS,

WAR DEPARTMENT, Washington, November 10, 1919.

House of Representatives.

SIR: In response to a request, dated October 31, 1919, from the assistant clerk of your committee, for a report on H. R. 8943. a bill granting, as a token of national appreciation, certain Victory bond bonuses to all members of the military and naval forces of the United States who served honorably between the 6th of April, 1917, and the 11th of November, 1918, I beg to inform you that such bonuses would, to all intents and purposes, amount to additional pay to men who served honorably during the period mentioned. The views of the War Department on questions of such additional pay have already been furnished your committee in letters dated July 28 and August 22, 1919.

In addition to my previous letters I desire to state that the number of men who served in the armed forces of the country, including those who served in the Army, the Navy, the Marine Corps, and the other services, amounted in round numbers to 4.800,000. It is roughly estimated by the War Department that the expense to the Government to provide the bonuses in Victory bonds, as contemplated by the proposed bill, would be approximately $720,000,000. The object of bonuses, as primarily intended, has been accomplished and the War Department does not feel justified in recommending that the bill receive favorable consideration.

Respectfully,

NEWTON D. BAKER, Secretary of War.

Following is a statement showing the estimated approximate cost of a bonus of $1 for each day's service rendered in the Army, Navy, or Marine Corps between April 6, 1917, and October 1, 1919. Bonus not to be paid to those remaining in the service nor to those who have been discharged other than honorably:

Total number of persons who served in Army during war.

Deduct:

..... 4,055,000

250,000

117,000

10,000

1,000

1,000

6,000

385,000

3,670,000

$2,100,000

9, 000, 000

18, 000, 000 18, 000, 000 24, 000, 000 22,500,000

27, 000, 000 31, 500,000 36, 000, 000 40, 500,000 37,500,000 41,250,000

36, 000, 000

49, 000, 000 42,000,000 45, 000, 000

48, 000, 000

12 months, 100,000 × $360.

13 months, 100,000 × $390.

14 months, 100,000 × $420.

15 months, 100,000 × $450.

$480.

51, 000, 000

18 months, 100,000 × $540.

54, 000, 000

It has been found from the figures obtained from the statistical branch, General Staff, that the number of persons who served in the Navy during the war is approximately 15 per cent of the number who served in the Army, and in the Marine Corps 2 per cent of the number who served in the Army. By applying these percentages to the cost for the Army it shows a cost of $181,732,500 on account of the Navy and $24,231,000 on account of the Marine Corps, making a total cost of $1,417,513,500; though the correctness of the figures for the Navy and the Marine Corps are not assured, they are believed to be approximately the amount shown, and are given, as it is thought they will serve the purpose for which desired.

OFFICE DIRECTOR OF FINANCE,

January 19, 1920.

Statement showing the number of days served in the Army between Nov. 11, 1918, and Mar. 1, 1920, by persons who would become entitled to the bonus proposed by various bills introduced in Congress.

Statement showing the number of days served in the Army by persons who would become entitled to the bonus proposed by the various bills introduced in Congress, between the period Apr. 6, 1917, and Nov. 11, 1918.