1
Where Your Taxes Go
How Uncle Sam Spends Your Money
in Conducting Your Business
By EDWARD G. LOWRY
Author “Washington Close-Ups.*’ “Banks and Financial System./'etc. Contributor
Pomaal and Economic Articles to Leading Periodical, and a Writer oi Recognised
Authority on the National Govemmenti Business Methods.
Copyright, Western Newspaper Uuioa
IV.
WAR’S HORRIBLE WASTE
Mr. U. C. Lefliugwcll was the as
sistant secretary of the treasury In
charge •( finances during the war.
While 1k‘ was in the treasury he be
came deeply Impressed with the mag
nitude of government expoditures and
the looseness, inefficiency and waste
lhat art a part of government meth
od. All the secretaries of the treas
ury aim* the outbreak of the war
have shared this feeling of apprehen
sion and concern with Mr. Lelllng
well. I <jiHrte here n recent utterance
of his ©u war expenditures:
“Of the $4,000,000,000, exclusive of
Interest on the public debt, spent In
the fiscal year 1921, 51,101.015,013.32
was spent by the War department.
$650,373,835.58 by the Navy depart
ment, $300,000,000 on the railroads,
$230,000 000 by the bureau of war risk
Insurance, and $357,814,897.01 by the
Interior department, mostly, I take It.
for Civil war and Spanish war pen
sions—a total of $3,080,000,000 under
these l>e:jds.
“In the fiscal year 1920 the War de
partment spent $1,610,000,000, and the
Navy department $740,000,000, a total
<*f $2560.000,000. Secretary Mellon
estimates that In the fiscal year, 1021,
the War department will spend $1,025,
000,000 and the Navy department
$700,000,000. a total of $1,725,000,000;
and that In the fiscal year, 1022, the
War dejmrtrnent will spend $570,000,
000, and the Navy department $545.
000,(XX), a total of $1,115,000,000. * This
makes a three-years’ total of $5,100,
000.000.
“Germany went to war to realize on
her investment In arms and armies.
The harden of universal military serv
ice, expenditures ( n the army and
navy, subsidies and doles, he< line In
tolerable. She thought she would re
peat the exploit of 1870 and make war
so profitable In territory and indem
nities as to recoup herself for the
outlay of 40 years’ preparation. The
splendid resistance of the Belgians and
the French and of the little British
expeditionary force made the short
war a futile dream. The untrained
manhood and unmortgaged resources
of the Western World, of the British
empire overseas, and finally of Amer
ica, determined the issue. Germany
suffered economic collapse, though her
armies, beaten h it not routed, were
still on enemy soil. So Germany’s
military preparedness was her cause
for making war and was the cause of
her defeat. In the Issue, it was eco
nomic preparedness that mattered
most.
“Today, men, women and little chil
dreti are starving to death in 1'urope he
cause of the war’s horrible waste and
because «f the still more horrible waste
of after the war. Two years and a
half after aimistice, nearly two years
after peace was concluded between
Germany and the allies, millions of
men are under arms, eating and wear
ing the produce of the fields and of
the labor of a civilian population
which must hear the load of taxes and
Inflation necessary to maintain those
armies in economic idleness, i ne peo
ples of continental Europe are stag
gering under the load of armaments,
far too great before the war and in
tolerable now. Their rulers hold them
selves In power by subsidies and doles,
by playing, now on their fears, and
again on their uvarlee, still again on
nationalistic ambitions or undent ra
cial hatreds. The allies have under
taken to Insure Germany’s economic
recovery by insisting upon her disarm
ament and the payment of reparations
which means the development of a
huge exjxirt balance; but for them
selves they reserve the doubtful privi
lege of remaining armed to the teeth. ..
“We have demonstrated our mili
tary power. We have shown what
may It' done In a few short months
to make an army and transport it to
wage a foreign war. We have no need
to he aggressors abroad, we are Invul
nerable at borne. Let us accept the
responsibilities of the position of lead
ership which is ours, show the world
how to beat swords into plow-shares,
relieve the peoples of the world of ap
prehension and lead them back Into
the ways of peace and plenty. If we
prepare for war we shall have it. If
we lead the world In preparation f»r
peace wo may have that.”
% WHAT PERSHING THINKS
The appropriations of the live great
powers for military and naval pur
poses In the year 1920 alone reached
a total of $16,442,251,101, a sutn only
about $2,000,000,000 more than the
total for the whole fourteen years be
fore the war.
It all comes down to this so far ns
you are concerned:
Every morning when you go to
work, or when you stay at home sick
on a working day. or even If you
are out of a job, It has been arranged
tor you to pay your fair share out
of what you earn or should earn, of
over $5,000,000 a day for the support
of tht army and navy. That is tlie
estimate for the fiscal year 1922
over $5,000,000 a day. I have General
Pershing’s word for It. You will have
to l>ay It. Five million dollars ever}
•aorktng day U a pile of money tt>
spend for insurance against attack.
And of course that Is not all the
cost. What is the big Idea? What do
you think about, it? You will have to
buy the bill. t>o you think about It
at all? Oeneral Pershing does. Tills
is what he thinks:
“As we consider the causes of the
World war and comprehend its hor
rors, every thinking man and woman
must feel that measures should lie
taken to prevent another such cal
amity. One step in that direction
would tie to reduce expenditures for
armament. Our own estimates for
naval nnd military purposes contem
plate an appropriation for the fiscal
year 1922 of over $.1,000,000 for every
working day in the year. It is a
gl< ctny prospect that the nations plan
expenditures greater than ever before
in peacetimes.
“It would appear that recent ex
periences should he enough to con
vince everybody of the danger of a
renewal of this competition. Hut one
nation cannot reduce armaments un
levs all do. It is time that enlightened
people everywhere should undertake
to reach some rational agreement
which would not only relieve the
world of Its heavy financial burden
hut which in itself would go far to
ward the prevention of war. We are
not a warlike people. We do not
wish to expand at the expense of any
other nation, and we have no designs
on anybody. If other people feel the
same toward us and toward each
other It seems unreasonable that they
should be unwilling to consent in
principle to some limitation of arma
ments, to be carried out when other
nations succeed in establishing stable
governments and are willing to recog
nize the wisdom of such a course.
Otherwise, may we not seriously ask
ourselves whether civilization is a
failure, and whether we are to regard
war as an unavoidable scourge ttmt
mankind must' suffer?
“There are other considerations
which should prompt us to make every
effort to bring about a curtailment of
these expenditures throughout the
world, particularly in the war-worn
countries of Europe. The people of
Europe have always been our best
customers and are largely dependent
upon us for certain necessities. We
must look te them t't buy the products
of our farms, mines and factories.
The prosperity of our people depends
in no small measure upon tlie unin
terrupted flow of commodities abroad.
We have stocks of cotton, wheat and
other' products greatly in excess of
our own requirements, which the
people of Europe sorely need but
which we cannot sell and they can
not buy heenuse their fiscal systems
have broken down, tlieT currencies
have depreciated, and their purchasing
power is exhausted.
"The first step to take In the re
hnhilitation of the finances of all these
countries Is to reduce the cost of
government so that expenses will not
exceed the incomes. Expenditures
must he lowered everywhere if
financial stability is to he restored and
if the nations are ever to pay their
debts. Until stability is restored none
can have prosperity tlint comes from a
free and uninterrupted flow of products
Mil lies
rrom 0110 ■ "Iiiiuy to niiuiurr, 1
cannot In* done if huge sums continue
to be appropriated for the mainte
nance of large armies and large navies.
"The safety of humanity In the
future, indeed the peace, the happiness
and the prosperity of the race—all
appeal alike for an early consideration
of the question of limited armaments.’'
Jtrondly speaking, it is the man who
profits, and not the simple average
man who endures, who Is behind all
tins movement for ever Increasing
armament. If you doubt this, just go
out in your own neighborhood and ask
hten who were actually in the war,
who saw service In the line, whether
they want any more of it.
Steel Barrets.
If ‘.he statements of the makers are
well founded, it is probable that steel
barrels will eventually take the place
of wooden ones. The steel barrel is
composed of staves of that material
locked together by an ingenious de
vice; the hoops and heads are also
of steel. It Is claimed that the steel
barrel is more durable and more com
pact than the wooden one. As it ts
<a!d to lie lighter and cheaper, it has
already had favor In various quarters.
About 300,000,000 barrels are needed
annually In normal times, to supply
the demand in the United Slates.
Flour mills use ahout 90,000,000, the
sugar Industry 40,000,000, and the
cement Industry 75,000,000.—Christian
Science Monitor.
Scientific Query.
When we read about monkey stars
getting salaries of $1,000 a week In
the movies we wonder whether evolu
tion is what it hus been cracked up
to be.
And if He Had Fallen!
Reaching the record height of 33,
000 feet In an airplane, a Frenchman
said he seemed to be flying through
a rose-colored atmosphere when at
that altitude.
.-...-... *v W .. *.- .-j.'j -&'X- *
1—ltadio-conlrolleil boat exhibited in tirst American Boys’ exposition in Washington. - Old oaken irlgatc
Granite Slate, pride of the navy in the middle of the last century, being junked in North river at New York. 3—
Chung of Lamar, tirst prize winner in annual show of Pekingese Club of America.
NEWS REVIEW QF
CURRENT EVENTS
Washington Conference Goes
Far Toward Establishing Real
Open Door in China.
AGREEMENT 8L0W TO JAPAN
Foreign Policy of New French Gov
ernment Stated by Premier Poin
care— Irish Free State Formally
Installed—Postmaster General
Hays Announces Coming
Resignation.
By EDWARD W. PICKARD
STRONGLY backed by the British
and Italian delegations to the
Washington conference, Secretary
Hughes and his American colleagues
last week pushed far toward comple
tion of their plans for the establish
ment and maintenance of a real “open
door" in China. In effect, it was a big
week for China and a rather unpleas
ant one for Japan.
Mr, Hughes submitted to the Far
Eastern committee a set of resolutions
by which the powers in the conference,
other than China, agree:
“(a) Not to seek or to support their
nationals in seeking any arrangement
which might purport to establish in
favor of their interests any general
superiority of rights with respect to
commercial or economic development
in any designated region of China;
"(b) Not to seek or to support their
nationals in seeking any such monop
oly or preference as would deprive
other nationals of tlie right of under
taking any legitimate trade or industry
tn China or of participating with tin*
Chinese government, or with any pro
vincial government, in any category of
public enterprise, or which by reason
of its scope, duration, or geographical
extent is calculated to frustrate the
practical application of the principle of
equal opportunity.”
China, for its part, declares its “In
tention of heing guided by the same
principles in dealing with applications
for economic rights and privileges
from governments and nationals of ail
foreign countries whether parties to
that agreement or not.
Provision is inane for tbe establish
ing of an International hoard to which
questions of compliance with the open
door principle may he referred for in
vestigation and report. As first draft
ed, the resolutions made this applica
ble to existing concessions. France ob
jected to this and the Japanese,
though accepting the plan "in princi
ple," were plainly nervous and wor
ried and asked for time to study the
(ext. In the interes! of speedy action
the objectionable clause was with
: drawn, and thereupon the plan was
given unanimous approval by the
I committee. The Americans did not
look on ibis as a defeat, for, under
their construction of the resolutions.
It will still he possible to bring before
the international commission any open
door question involving existing ••on
cessions, including the privileges
which Japan by her notorious 21 de
mands forced China to concede in 1915.
; The Japanese maintain they got noth
ing through those demands that vio
lates the open door principle. Ambas
sador Shidehara does not believe the
; higtrd of reference plan is practicable,
but finally accepted It.
It really looks as though the com
mercial open door in the Far Hast Is
| about to become, in the words of Mr.
| Hughes, a fact instead of a motto.
In the latter part of the week the
committee was considering the matter
of the reformation of China’s railway
system. The British proposed that the
powers undertake to abolish all trans
portation discrimination in China, and
.tie Americans suggested that Chinn
unify her railways under her own con
trol “with -U' h foreign financial and
technical co-operation as may prove
necessary."
Some dispute, unknown to tlie public
:t this writing, held up final comple
,ii\ of the naval treaty. Apparently It
.nvolved .be question of fortifications,
und members of the British and Jup
anese delegations blamed each other
for the delay. It was said the British
wanted to lindt the fortifications sta
tus quo to the parts of the Pacific
where Japan and the United States
have neighboring possessions, and that
they Insisted that In any (‘vent it could
not affect Singapore, which is their
most important naval base in the Far
East.
A [-THOUGH Poincare and Lloyd
George exchanged honey-worded
notes of esteem and assurance of cor
dial desire to resume examination of
the questions at Issue between their
governments, the new French premier
took a firm stand in his ministerial
declaration made to the chamber of
deputies Wednesday. He said the
government was determined to base its
foreign policy on the Versailles treaty,
and was anxious to maintain and con
solidate its alliances. Germany, he
insisted, must make up its mind to ful
fill the obligations it undertook at Ver
sailles. Before agreeing to take part
in the Genoa conference, he said.
France must have guarantees from the
soviet government of Russia. In talk
ing to correspondents, M. Poincare
said he would not go to Genoa; that
French business men might meet Ger
man ami Russian business men there,
but that France desired Mint the Genoa
conference should not be the means of
Bolshevik propaganda in Europe.
The Russians are very enthusiastic
over the Genoa meet and already have
announced the list of their delegates.
It is headed by Premier Lenin, whose
place will be taken by Foreign Minis
ter Tchitcherin if the chief cannot go;
tiie other members are ail prominent in
the soviet government. 1-con Trotzky,
however, does not think the confer
ence can be a success unless the Unit
ed States 'participates and takes the
lead. He adds that Russia favors gen
eral disarmament, but it is skeptical
of France.
THE soviet government is not yet
at war with Finland over the
Karelian revolt, but hostilities seem
not far off unless the Finns yield com
pletely. They offered to have the af
fair arbitrated, but this the Russians
refused. Tchitcherin now demands
tlie Internment, disarming and surren
der to soviet Russia of all Karelian in
surgents on Finnish soil, tlie surrender
to Russia of their arms, and an indem
nity from Finland for all damages
done to Russia through the Karelian
revolt.
IN ACCORDANCE with the decision
of the reparations commission, Ger
many is paying $7,,">00,000 gold every
ten days until further arrangements
are made. The first payment was made
on Wednesday.
TilK French were much aroused hy
a resolution introduced In the
United States senate by Medill Mc
Cormick of Illinois. It calls on the
State department tor full information
concerning the financial condition, the
budgets and the amounts spent on mil
itary establishments by European
countries that owe money to America.
Then- is a belief in France that the
resolution was aimed at that country
alone lie-cause of its stand concerning
its land forcc-s and on the subject of
submarines. There was no indication
that the- re-solution had the approval of
the- American administration, and it
may he that in stirring up something
of a row it lias done* all Mr. McCormick
ever expected it would dei.
LOUD FITZAI.AN, British viceroy
of Ireland, on Tuesday formally
turned eiver Dublin castle to tlie pro
visional government of the Irish Free
State-, (lie official ele-signatiein of which
is Kiultas Sealuheach Nu Helreaim.
The geivemim-nt feir the present con
sists of Miohuel Collins end seven as
seiciate-s. Griffith, who is president of
the Pail Klrealm, believed that body
should he kept separate freim the new
state eirganization and sei declined to
head the provisional government. As
rapidly as a ..ae ticatile the British
troops are he-ing renteiveel from the
island, and as they leave there are
many outbreaks by the irreconcilable
republicans. Collins and his col
leagues are planning to s,-inl a commit4
shut to Canada to study the I 'audition's
form of government and draft a con
stitutlou along Canadian lines. The
Bank of Ireland lias agreed to lend the
ueu government u million pounds.
OPE BENEDICT XV passed away
1 rather unexpectedly after brief
suffering from a cold which suddenly
developed into pneumonia. Until al
most the last his physicians Insist
ed that the attack was not seri
ous, and the passing of his holiness
surprised as well as shocked the en
tire world. Benedict was born in 1854
and was elected pope in 1914. He
won general esteem by his wise courses
and counsels ns head of the Uotnnn
Catholic church and l>y his enrnest and
continuous efforts to restore peace and
amity among the nations after the out
break of the World war. Because a
fatal outcome to his illness had not
been looked for there has been no dis
cussion yet as to his probable suc
cessor.
DOSTMASTER GENERAL HAYS
* has announced his retirement from
the rablnet about March 4 for the pur
pose of becoming the directing head of
the new National Association of Mo
tion Picture Producers and Distribut
ers. President Harding, in regretfully
accepting his resginatlon, expressed
the opinion that Mr. Hays was about
to take up a work of great public bene
fit. It is believed Hubert Work ol
Colorado, now lirst assistant, will sue
ceed Mr. Hays as postmaster general
with the understanding that he will re
tire in the fall to make way for Sena
tor New of Indiana in case the senate:
is defeated for renomination or re-elec
tion. Mr. New’s opponent In the Re
publican primaries will be former Sen
ator Albert Beveridge.
IN A report transmitted to the sen
ate the federal trade* comtnissior
charged that three of the largest to
bacco manufacturing concerns in tht
country—the American, the P. Lori!
lard and the Liggett & Meyers compa
nies—have engaged in conspiracies
with many jobbers' asociutions to keej;
up jobbers’ prices. The commission
promises prosecutions where the evi
deuce discloses violations of the law,
The report says the jobbers’agreement
became effective last September when
it was learned that the commission’s
investigation was under way. The
three companies named were formerly
parts of tiie tobacco trust which wa«
dissolved by the Supreme court.
7 ITHOUT waiting to tie asked
* * the American government tin?
Intervened in ttie dispute between
Cliile and Peru over the Tacna-Artca
territory and ttie treaty of Ancon, and
tins Invited both countries to send
delegates to Washington for a confer
ence. Ttie invitations, sent in tin
name of President Harding, say tin
American government has observe*
with pleasure that ttie negotiations tie
tween ttie two South American repub
lies ‘‘seemed to forecast a settleniem
in conference of the difficulty involv
ing final sovereignty of the province!
of Tacna and Arica.” Itecent dis
patches indicate this is a rather optim
istic view of the situation, hut it mat
be justified.
TIIHOrOH Ambassador Iticharc
Washburn Child and General At
leu. at tlie head of a composite hat
talion from the army of oci u pat I on
America on Wednesday paid tribute t<
tiie memory of Italy's ‘‘unknown sol
dier,” wiio is buried in Home. Kinf
Victor Knimaiiuel and all high govern
ment officials, as well as the entire
diplomatic corps, attended the impress
ive ceremony, wliich was witnessed bj
an immense throng. Amliassador Child
delivered the oration and bestowed or
the Italian warrior the Congressional
Medal of Honor, and Premier Bonoml
responded for ids country.
AN KNCOl’ItAGIXG start tins beer
made in tlie collection of the mil
lioti-dollar fund which ttie Woodrow
Wilson foundation will administer bj
making annual awards to persons wht
distinguish themselves by their serv
ice to humanity. All over the countrv
the pledges came in thick and fast
One of the most significant contrlhu
tions was that <>f h.v tlie rail
road sliop crafts unions. The resolu
tions accompanying It said tin* con
tributioti was “a testimonial to Wood
row Wilson for ids unselfish ideals it
behalf of not only the people of tla
1‘nlted States but of ttie entire worb
who loved liberty and happiness, am
for bis fairness in dealing wit! fact
that so vitally affected the welfare o
| tlie American people.'’
MORE PROFITS ARE
ASSURED FARMERS
WASHINGTON CONFERENCE CON
SIDERS WAY AND MEANS FOR
GREATER EFFICIENCY
MUST HAVE ORGANIZATION
Contemplated Organization Would
Control Output. Possible For Farm
ers To Standardize Quality
And Price Of Produce.
Washington —With "dirt" farmers
bluntly itemizing their financial dis
tress, and President Harding propos
ing far-reaching measures of govern
ment assistance, the 300 delegates to
the agricultural conference called by
Secretary of Agriculture Wallace be
gan consideration of comprehnsive
plans to organize agriculture on the
same basis of economic advantage as
industry and commerce.
‘‘There should be developed,” said
the president, ‘‘a thorough code of law
and business procedure, with the prop
er machinery of finance, through some
agency, to insure that turnover capi
tal shall be as generously supplied to
the farmer and on as reasonable terms
as to other industries. An industry,
more vital than any other, in which
nearly half the nation's wealth is in
vested, can be relied upon for good se
curity and certain returns.”
The president suggested an amplifi
cation of the machinery of the Farm
Loan oard and the adoption of the
plan of European rural finance so
cieties.
Mr. Harding strongly would legalise
co-operative marketing to make “the
farmer’s selling price higher and the
consumer a price lowr.
To aid the farmer, transportation
facilities must be increased, Mr Hard
ing said. To accomplish this he sug
gested tta electrification of railroads
to reduce such waste as the hauling of
coal for transportation, and the de
velopment of waterways.
Representative Anderson of Minne
»ota, chairman of the conference made
a plea for organizaton of the farmers
of control of output. He said that
price declines have been smallest in
those commodities that are controlled
by highly organized industries of which
the dairy industry is an example.
“When 1 consider," said Mr. Ander
son, "the desperate character of the
situation, 1 could wish that there was
some means of bringing about this con
dition by governmental action, but f
am sur theersnioAbos tnfeyho Be:o9
am sure there is no governmental
panacea, that there is no magic word
of legislation or magic word of admin
istrative of action that can bring about
these results. I am persuaded that
they can only be accomplished through
a more efficient organization of the
producers.
"It is possible by organization for
farmers to standardize the quality of
the produce of many farms within a
given locality and by such standardisa
tion increase the price per unit for
the entire crop.
"The farmer must delegate the
power of selling his crop and of put
ting it in shape for market and of
performing all the services necessary
to its delivery in quality, quantity,
time and place to some organization
which he controls."
Methodists Lack Quota.
Nashville, Tenn.—Southern Method
ists lack $13,000,000 of having their
quota in the campaign for Christian
education which ends May 1, it was
announced here by Dr. Stonewall An
derson, secretary of the Board of Edu
cation, which initiated the undertak
ing.
Aged Woman Is Burned.
Kewanee, 111.—Mrs. Elizabeth Sweet,
71 years old. was burned to death when
her clothes caught fire while she was
lilling a kerosene stove.
Town Takes Precaution.
V.icon. Mo -The arrest of every
train crew which permits passengers
from Moberly, Mo., to alight at the
local station, has been ordered by
Mayor N. M. Lacy, in an effort to pro
tci t Macon against the smallpox epi
demic reported from Moberly.
Three Cie In Car Crash.
El Paso, Texas.—Russell Hignett, 18
Firman Hignett, 20, and Carl Hignett,
10, brothers of this city, were killed
■ hen the car In which they were rid
ng was struck by a Southern Pacific
passenger train at a grade crossing 20
miles east of here.
Many Indians Arrested.
f'alcutta.—More than 100 Indian Na
donalists were arrested recently
while tryvtg to march in procession
hrough the city.
Two Churches Burned.
Sterling, 111.—Two churches in the
win cities of Sterling and RockfaUs,
allied at over $100,000, were totally
lestroyed by simultaneous tires when
he K;rst Presbyterian Church in
Rerling and the First Methodst
hurch in RockfaUs burned to the
ground.
Germans Regain Rights.
Lisbon.—German citizens residing
•i Portugal have been restored to full
rights by government decree