5
i
How to Raise Revenue to Meet Expenses;
Stern Rebuke for the Disloyal Citizens
THE BEE: OMAHA. WEDNESDAY, DECEMBER 8. 1913.
(Continued from Fug Four.)
thtt great policies by which we winh to
-1 make rood, now and always, our right to
are few measures you could adopt which I lead In enterprise of peace and good will
would mors servlceably clear the way for and economic, and political freedom.
Where Will Money Come From to
Carry Out the Defense Program?
"The plans for the armed forces of the
nation which I have outlined, and for
the general policy of adequate prepara
tion for mobilisation and defense. Involve
of course very large additional expendi
ture of money expenditures which will
considerably exceed the estimated reve
nues of the government. It is made my
duty by law, whenever the estimate of
expenditure exceed the estimates of
revenue, to call the attention of the con
gress to the fact and suggest any means
of meeting the deficiency that It may bo
wisa or possible for me to suggest. I
am ready to believe that It would be my
duty to do so In any case; and I feel
particularly bound to speak of the mat
ter when it appears that the deficiency
will arise directly out of the adoption by
the congress of measures which I myself
urge it to adopt. Allow me. therefore,
to speak briefly of the present state of
the treasury and of the fiscal problems
which the next year will probably dis
close. Comdltlon of the Treasary .
. "On the thirtieth day of June last there
was an available balance In the general
fund of the treasury of il04.170.106.78.
The total estimated receipts for the year
1918, on the assumption that the emerg
ency revenue measure passed by the last
congress will not be extended beyond
Its present limit, the thirty-first of
December, 1915, and that the present duty
of one cent per pound on sugar will be
discontinued after the first of May, 1918,
will be t670.366,M0. The balance of June
last snd these estimated revenues come.
therefore, to a grand total of 1774.536,
406.78. The total estimated disbursements
for the present fiscal year, including
twenty-five millions for the Panama
canal, twelve millions for probable de
ficiency appropriation, and $50,000 for
miscellaneous debt redemptions, will
be $753,891,000; and the balance In
the general fund of the treasury will
be reduced to J30.644.eO5.V8. .The emerg
ency revenue . act, - if continued beyond
its present " time limitation,, would pro
duce, 'during the half year then remain
ing, about, forty-one millions. ' The duty
of one cent per pound on sugar, if con
tlnued, would produce during , the two
months of the - fiscal year remaining
after the' first of May, about fifteen mil
lions. These two sums, amounting to-
twther-to fifty-six millions, if added to
the revenues of the second half of the
, fiscal year, would 'yield "the ' treasu ry at
the end of the year an available bal
ance of 176,644,606.78.
estimates of Additions.
The additional revenues , required to
carry out the program of military and
naval preparation of which I have
spoken, would, as at present estimated,
be for the fiscal year 1817, 193,800.000.
Those figures, taken with the figures
for the present fiscal year which I have
already given, disclose our financial
problem for the year 1917. Assuming
t that the taxes Imposed by the emergency
revenue ; act and the present duty on
. sugar are to be discontinued, and that
the balance at the close of the present
fiscal year will be only 120,644,606.78, that
the disbursements for the Panama canal
will again be about twenty-five millions,
ind that the additional expenditures for
the army and navy are authorised by the
congress, the deficit In the general fund
of the treasury on the thirtieth of June,
1917, will be nearly two hundred and
thirty-five millions. To this sum at least
fifty millions should be added to repre-
sent a safe working balance for the
treasury, and twelve million to Include
the usual deficiency estimates In 1617;
and these additions would make a total
' deficit of some two hundred and ninety
seven millions. , If the present taxes
should be continued throughout this
year and the next, however, there would
ie a balance 1 In the treasury of some
seventy-six and a half millions at the
nd of the present fiscal year, and a
: leficlt at the end of the next year of
only some fifty millions, or. reckoning
In sixty-two millions for deficiency ap
propriations and a safe treasury balance
at the end of the year, a total deficit
of some one hundred and twelve millions
The obvious moral of the figures Is that
It la a plain counsel of prudence to con
tinue all of the present taxes or their
equivalents, and confine ourselves to
the problem of providing one hundred
and twelve millions of new revenue
rather than--two hundred and ninety
seven millions.
New Taxes Proposed.
How shall we obtain tha new revenue?
We are frequently reminded that there
are many millions of bonds which the
treasury Is authorised under existing law
to sell to reimburse the sums paid out
of current revenues for the construction
of the Panama canal; and It Is true that
bonds, to the amount of approximately
$222,000,000 are now available for that pur
pose. Prior to 1913 il34.63i.ra or xneso
bonds had actually been sold to recoup
the expenditures at the Isthmus; andnow
constitute a considerable Item of tha
public debt. But I. for one, do not be
lieve that the people of this country ap
prove of postponing the payment of their
"While we speek of the preparation f
the nation to make sure of Its security
and Its effective power we must not fall
Into the patent error of supposing that Its
real strength comes from armaments and
mere safeguards of written law. It
comes, of course, from Its people, their
energy, their success In their undertak
ings, their free opportunity .to use the
natural resources of our great home land
and of the lands outside our continental
borders which look to us for protection.
for encouragement, and for assistance
In their development from the organi
sation and freedom and vitality of our
economic life. The domestic questions
which enraged the attention of the last
congress are more vital to the nation in
this Us time of test than at any other
time. We cannot adequately make ready
for any trial of our strength nnless we
wisely and promptly direct the force of
our laws Into those all-Important fields
of domestic action. A matter which It
seems to me we should have very much
at heart Is the creation of the right In
strumentalities by which to mobilise our
economlo resources In any time of na
tional necessity. I take It for granted
that I do not need your authority to call
Into systematic consultation with the di
recting officers of the army and navy
men of recognised leadership and ability
from among our cltisens who are thor
oughly familiar, for example, with the
transportation facilities of the country
and therefore competent to advise how
they may be co-ordinated when the need
arises, those who can suggest the best
way In which to bring about prompt co
operation among the manufacturers of
bills. Borrowing money Is short-sighted
flnanoe. It can be justified only when ) the country, should It be necessary, and
permanent things are to be accomplished I those who could assist to bring tho technl-
whlch many generations will certainty
benefit by and which It seems hardly
fair that a single generation should pay
for. The objects we are now proposing
to spend money for cannot be so classi
fied, except In the sense that everything
wisely done may be said to be done In
tho Interest of posterity as well as In
our own. It seems to me a clear dictate
of prudent statesmanship and frank
finance that In what we are now, I hope,
about to undertake we should pay as we
go. The people of the country are
entitled to know Just what burdens of
taxation they are to carry, and to know
from the outset, now. The new bills
should be paid by Internal taxation.
"To what sources, then, shall we turn?
This is so peculiarly a question which the
gentlemen of the house of representatives
are expected under tho constitution to
propose and answer to that you will
hardly expect me to do more than discuss
It in verj reneral terms. We should be
following an almost universal example of
modern governments If we were to draw
the greater part or even the whole of the
revenues we need from the Income taxes.
By somewhat lowering the present limits
of exemption and tho figure at which the
sur-tax shall begin to be imposed, and by
Increasing, step by step throughout the
present graduation, the surtax Itself, tha
Income taxes as at present apportioned
would yield sums sufficient to balance the
books of the treasury at the end of the
fiscal year 1917 without anywhere mak
ing tho burden unreasonably or oppres
sively heavy. The precise reckonings are
fully and accurately set out in the report
of tha secretary of the. treasury which
will be Immediately laid before you.
Other laarcFi to Tapped.
"And there are many additional sources
of revenue which an Justly be resorted
to without hampering the Industries of
the country, or putting any too . great
charge upon Individual expenditure. A
tax of 1 cent per gallon on gasoline and
naphtha would yield, at the present esti
mated production, 110,000,000; a tax of 60
cents per horse power on automobiles
and Internal explosion engines, 816,000,000;
a stamp tax on bank checks, probably
$18,000,000; a tax of 25 cents per ton on
pin iron, 810,000,000; a tax of 25 cents per
ton on fabricated Iron and steel, prob
ably $10,000,000. In a country of great In
dustries like this It ought to be easy to
distribute the burdens, of taxation with
out making them anywhere bear' too
heavily or too exclusively upon any one
set of persons or undertakings. What la
clear is, that the Industry of this gener
ation should pay tho bills of this generation.
Disloyal Element of Citizenship
Most Serious Menace Present
"l have spoken to you today, gentle
- men, upon a single theme, the thorough
preparation of the nation to care for its
own security and to make sure of entire
freedom to play the impartial role In this
hemisphere and in tho world which . we
' all believe to have been providentially as
; signed to It I have had In my mind no
thought of any immediate or particular
: danger arising out of our relations with
other nations. We are at peace with all
; the nations of tho world, and there is
reason to hope that no arueatlon In con
, troversy between this and other govern-
tnents will lead to any serious breach of
i vnlcable relations, grave as some dlffer
i ences of attitude and policy have been
and may yet turn out to be. I am sorry
, to say that the gravest threats against
! our national peace and safety have been
' uttered within our own borders. There
' are cltisens of the United States, I blush
i to admit, bora under other flags but wel
corned under our generous naturalisation
laws to the full freedom and opportunity
, of America, who have poured the poison
. of disloyalty Into the very arteries of our
national life; who have sought to bring
the authority and good name of our gov-
' eminent into contempt, to destroy' our
. Industries wherever they thought it ef-
fcctlve for their vindictive purposes to
' strike at them, and to debase our politics
': to the uses of foreign intrigue. Their
I number is not great as compared with
, the whole number cf .those sturdy hosts
i by which our nation has been enriched
In recent generations out of virile foreign
. slocks; but it is great enough to have
brought deep disgrace upon us and to
have made it necesaary that we should
promptly make use of processes of law
; yy which we may be purged of their cor
i tupt distempers. America never wit-
jt uessed anything like this before. It
never dreamed it possible that men sworn
into its cltlsenahlp, men drawn out of
. great free stocks such as supplied some
cf the best and strongest elements of
' that' little, but how heroic, nation that
In a high day of old staked Its very life
: to free Itself from every entanglement
that had darkened the fortunes of the
older nations and set up a new standard
here, that men of such origins and such
' free choices of allegiance would ever turn
in malign reaction against the govern
ment and people who ha4 welcomed and
u . nurtured them and seek to make this
I proud country once more a hotbed of
European passion. A little while ago
such a thlnr would have seemed Incredi
ble. Because It was Incredible we made
no preparation for It. We would have
been almost ashamed to prepare for It,
as if we . were suspicious of ourselves.
our own comrades and neighbors 1 But
the ugly and Incredible thing has actually
come about and we are without adequate
federal laws to deal with with it, I urge
you to enact such laws at tha earliest
possible moment and feel that In doing
so I am urging you to do nothing less
than save the honor and self-respect of
tho nation. Such creatures of passion,
disloyalty and anarchy must bo crushed
out. They are not many, but they art
infinitely malignant, and the hand of our
power should close over them at once.
They have formed plots to destroy prop
erty, they have entered Into conspiracies
arainst the neutrality of tha government.
they have sought to pry Into every con
fidential transaction of the government In
order to serve interests alien to our own.
It Is possible to deal with these things
very effectually. I need not suggest the
terms In which they may bo dealt with.
These Arc Disloyal.
"I wish that It could be said that only a
rew men, misled by mistaken sentiments
of allegiance to the governments under
which they were born, had been guilty
of disturbing the self-possession and
misrepresenting the temper and prin
ciples or the country during these days
of terrible war, when it would seem
that every man who was truly an Ameri
can would instinctively make It his duty
and his pride to keep the scales of Judg
ment even and prove himself a partisan
or no nation but his own. But It can
not. There are some men among us, and
many resident abroad who. though born
and bred in the United States and call
lng themselves Americans. have so for-
rotten themselves and their honor ai
citisens as to put their passionate lym
pathy with one or the other aide In the
great European conflict above their re
gard for the peace and dignity of the
United Btates. They also preach and
practice disloyalty. No laws, I suppose,
can reach corruptions of the mind and
heart; but I should not speak of others
without also speaking of these and ex
pressing the even deeper humiliation and
scorn which' every self-possessed and
thoughtfully patriotic; American must feel
when ha think of them and of the dis
credit they are dally bringing upon us.
cat skill of the country to the aid of the
government In the solution of particular
problems of defence. I only hope that If
I should find It feasible to constitute such
an advisory body the congress would be
willing to vote the small sum of money
that would be needed to defray the ex
penses that would probably be necessary
to give It the clerical and administrative
machinery with which to do serviceable
work.
Moblllsatloa of Factories.
"What Is more Important Is. that the
Industries and resources of the country
should be available and ready for mobili
sation. . It Is the more Imperatively neces
sary, therefore, that we should promptly
devise means for doing what we have
not yet done: that we should, rive tn
teligent federal aid and stimulation to In
dustrial and vocational education, as we
have long done In the large field of our
agricultural Industry;-that, at the same
time that wo safeguard and conserve he
natural resources of the country we
should put them at tho disposal of those
who will, use them promptly and Intelli
gently, as was sought to be done In the
admirable bills submitted to the last con
gress from Its committees on the publlo
lands, bills which I earnestly recommend
In principle to your consideration; that
we should put Into early operation some
provision for rural credits which will add
to the extensive borrowing facilities
already afforded tha farmer by the re
serve bank act adequate Instrumentalities
by which long credits may be obtained
on land mortgages; and that wo should
study more carefully than they have
hitherto been studied tha right adaptation
of our economlo arrangements to chang
ing conditions.
Let Us Kec Awake.
'Many conditions about which we have
repeatedly legislated are being altered
from decade to decade. It is evident, un
der our very eyes, and are likely to
change even more rapidly and more
radically in the days Immediately ahead
of us, when peace has returned to tho
world and the nations of Europe onoo
more take up their tasks of commerce
and Industry with the energy of those
who must bestir themselves to build
anew. Just what these changes will be
no one can certainly foresee or confidently
predict. There are no calculable, because
no stable, elements In the problem. The
most we can do Is to make certain that
we have the necessary Instrumentalities
of Information constantly at our service
so that we may bo sure that we know
exactly what wo are dealing with when
wo come to act. If It should be necessary
to act at all. We must first certainly
know what It Is that we are seeking to
adapt ourselves to. I may ask the privi
lege of addressing you more at length on
this important matter a little later In
your session.' .
Problem ef Traaaportatloa.
In the meantime may I make this
suggestion? The transportation problem
Is an exceedingly serious and pressing
one in this country. There has from
time to time of late been reason to fear
that our railroads would not much longer
be able to cope with It successfully, as
at present equipped and co-ordinated. I
suggest that it would be wise to provide
for a commission of Inquiry to ascertain
by a thorough canvass of the whole ques
tion whether our laws as at present
framed and administered are as service.
able as they might be in the solution of
the problem. It is obviously a problem
that lies at the very foundation of our
efficiency as a people. Such an Inquiry
ought to draw out every circumstance
and opinion worth considering and we
need to know all sides of the matter If
wo mean to do anything In the field of
federal legislation.
"No one. I am sure, would wish to
take any backward step. The regulation
of tho railways of the country by fed
eral commission has had admirable re
sults and has fully Justified the hopes
and expectations of those by whom the
policy of regulation was originally pro
posed. The question is not what should
we undoT It Is. whether there Is any.
thing else we can do that would supply
us with effective means. In the very
process of regulation, for bettering the
conditions under which the railroads are
operated and for making them more use
ful servants of the country as a whole.
It seems to me that It might be, the
part of wisdom, therefore, before further
legislation In this field Is attempted, to
look at the whole problem of co-ordina
tion and efficiency In the full light of a
fresh assessment of circumstances and
opinion, as a guide to dealing with the
several parts of it.
- Service is tho Watchword
"For what we are seeklnr now, what
In my mind la the single thought of this
mesaare. is national efficiency and se
curity. We serve a rreat nation. We
should serve It in the spirit of its peculiar
genius. It Is the genius of common men
for self-government. Industry, Justice, lib
erty and peace. We should see to It
that It lacks no Instrument, no facility
or vigor of law. to make It sufficient to
play Its part with energy, safety, and
assured success. In this we are no par
tisans but heralds and prophets of
new age."
I or brave, or earnest, ,
If an' you've said some- yss-ist-j
' I thing. 'Say, "he's a &&0lBSB
1 man" air you've said mA
I all. When I say
I VELVET is tobacco as WMMh M
SI it should be, I've said it fe5
' t
sssssssaBssssssssssssssssawsssssasj ;;:ftx f V 7 ,VWfJMr. .. i4f
n wmw aarr
The
of VELVET Tobacco
is an Open Secret
mm:
There is no hocus-pocus no mystery
aboutvVELVET Smoking Tobacco.
Anyone with the experience, and facilities,
who is willing to spend the money, can
produce VELVET.
Here is the recipe:
1 Take the choicest obtainable selections of the
famous "white" Burlcy tobacco of Kentucky.
2 Have this "judged" by tobacco experts, who
specialize on Burley tobacco.
3 Take their selections and pack them in1 great
hogsheads.
4 Store these hogsheads with their valuable con
tents for a period of not less than two years,
permitting eight seasons of natural "maturing."
5 Under guidance of skilled blenders take selec
tions from various plantations, and so blend
these as to produce the smoothest tobacco.
6 Manufacture this, in accordance with the
highest standard, into tobacco, with just the
right degree of richness, and proper aroma
and mildness.
While this is simple enough it involves a great deal of
knowledge, money, patience arici time.
The rapidly increasing
VELVET sales, how
ever, justify our natural
method of ageing it
We absolutely guar
antee that no tobacco
used in VELVET is
artificially aged
. Panama-Paclfie ii(s'
kighmtt mwardThu Grand Prim
-Ka, lamn snswreW fo VELVET
"for ill muparia quality."
Cr, 1919
10c Tks U Metal-Baea lags
OaereeaaCUssUssaUsrs
With each Oristmat Humidor of VELVET
there is a genuine surprise that makes it an
even. more acceptable gift
j: t r . nVw iSi
hi! w f
, ;' ,i"'""' " '
