AMERICAN DEBTS

Rotorua Morning Post, Volume 2, Issue 257, 22 June 1932, Page 2

AMERICAN DEBTS

STILL INCREASING EACH MAN NOW WORKS 61 DAYS FOR THE STATE. GREAT INTEREST BURDEN. NhJW YORK, May 10. Next to the Great War, the hulk of the increase in the United States public debt is due to local and municipal agencies (says the Wellington Post's correspondent. President Hoover told the convention of State Gowhile the Federal debt had declined vernors at Richmond, Virginia, that by 25 per cent., the municipal debt had increased by 55 per cent. in the past six years, and, in the aggregate, was £2,500,000,000, or 75 per cent. of the total Federal debt of the United States. "National impoverishment is at the end of the road by which the United States is travelling just now," said the President. "Before the war, theoretically, every man worlced 25 days a year for the national, State, and local governments combined. In 1924, he worked 46 days a year. To-day, he worlcs for the support of ail forms of government 61 days out of yjai\" Legacy of Boom Period^

Before the war, the total cost of the three forms of governmeni referred to represeuted only' about 8 per cent. of the national income. In the succeeding ooom times, when the na- j tional income should increase more rapidly than the cost of government, the latter increased at such a rate as to represent 15 per cent. of the national income, of which less than 3 per cent. was directly due to the war. To-day, with the falling off of business, the aggregate expenditures of national, State, and local governments represent more than 20 per cent. of the national income. The tendency in retrenchment, according to the President, is to reduce the cost of those services necessary to the protection of life, property, defence and other vital functions, rather than to reduce those items which excite the political interest of special groups. With regard to those employed by the Federal Government, it was intended, he said, by shortening the working time, to give each employee a continued living. Highway to Recovery. Taxation in four phases confronted the nation, said the President. First, the need for reduction; second, the need for new forms of taxation to replace revenues which had failed under depression; third, the problem of duplication in the tax field between Federal, State and local governments; fourth, the need for a more just distribution of the taxation hurden, as hetween the various groups of taxpayers. "All these cross-purposes contribute to economic duress. The many provisions of multiple taxation may vary so much that a taxpayer coming under several jurisdict o:.3 may find himself paying a wholly unreasonable amount for the support of government. The tax levies of the various taxing authorities all constitute a burden on the national income and in times of depression, when the relative weight of that hurden is increased, lack of co-ordination in the system hecomes a matter of prime importance." The sure highway to national recovery, in the mind of the President, lies in more equitable combination, greater simplicity, and better adjustment of the tax burden among the people. On the part of the people, there was need of patience and the recognition of the diffieulty of the problem confronting the servants of combined public interest.