Evening Star Newspaper, June 11, 1927, Page 3

. Gen. Lord Urges Reductions To Prevent Wen. H. M. Lord, Director of the Bureau of the Budget, spoke as fol- lswa at the semi-annual business meet- $ng of the Government last night: “Mr. President and members of the business organization of the Govern- ment: . “In preparing the first budgets we ‘were obsessed by fear of a deficit. The year 1921 ylelded a surplus of only +$86,723,771.61, while the outcome for ‘1922, a year of tax reduction, could not be forecast with any degree of accuracy. So you were urged to re- uce your estimates, to cut down your {expenditures, and to make sacrifices all along the line in the interest of a balanced budget, to prevent the pos- -aibility of that repugnant and dis- tasteful thing, a national deficit. To that appeal you made loyal response. When, however, the year 1922 ended ‘with a surplus of $313,801,651.10, and ‘when 1923 surprised us with a surplus of $309,657,460.30, the appeal for sacrifices in order to balance the bud- |;met lost about 101 per cent of its ; force and effectiveness. It must have “seemed to people in the service that we had been crying ‘Wolf! wolf!" when there was no wolf, not even a rabbit. | The appeal, however, was made in good faith. “Extraordinary transactions, in ui* usual and unheard of amounts, so confused the situation that no esti- mate was safe, and no ore could guarantee a balanced budget. It was evident, however, that a new kind of appeal was necessary. We were still “spending too much money. The fight | for reduced outlay must go on. Care- | ful study of Federal activities pointed to an objective—difficult but not im- possible of attainment—to bring an- nual Federal expediture, exclusive of debt reduction and postal expenses, | down to or below $3,000,000,000. It | meant a desperate fight, but not a hopeless one. In June, 1923, we in- | auguratea the three-billion-dollar | campaign in the interest of. progges- | sive national retrenchment. In- 1923 | the expenditure figures totaled $3,294,- | 627,529.16—$294,000,000 above our self- imposed limit. = We were out to get ! that $294,000,000, and at the same time be prepared to meet and absorb #dditional burdens of millions and hundreds of millions resulting from new legislation and from other causes outside of administrative control. Reduced Expenditures. “Beginning with 1920 there had been reductions in expenditure, many of them in large amounts, made pos- sible in large measure by discontin- uance of war activities. When this new campaign began, Federal busi- ness had settled down to a degree that rendered further material reduction a matter of careful scrutiny, calling for a very high standard of adminis- tration and real sacrifice and courage. At the end of 1924—first year of the new campaign—we found an expendi- ture of $3,048,677,965.34, a reduction of $245,949,563.82 below the preceding year. This saving was reflected in ‘what was at that time a record-break- .ing surylus of $505,366,986.31. This 1924 expenditure was $2,067,249,723.96 less than we took from the Treasury !in 1921. The year 1921 is used for comparison because it was the last ! year free from budget control and was & year marked by two differing politi- cal administrations. In 1925 we had ‘an apparent setback, expenditures running up to $3,063,105,332.26—an ‘increase of $14,427,366.92 over 1924, In spite of that we provided a surplus of $250,505,238.33, and that following ianother reduction in tax rates, which wasn't so bad. And 1926 was another year of grievous disappointment, re- warding our desperate efforts at re- trenchment with an expenditure of $3,097,611,822.81, or $48,933,857.47 over and above what we spent in 1924—at that time our low-water mark of ex- penditure. Were we discouraged? ‘Were we disposed to abandon the fight National Deficit each oncoming wave deposited a fresh installment Inside the gunwales of the craft, while several threatening leaks added to the difficulty and danger. The boys struggling at the oars, with their feet in the water, accused the almost exhausted bailer of slacking on the job. He indignantly denied the accusation and showed conclusively that had he not kept busy with his bailing the boat would have filled and sunk. He was so exasperated at their lack of appreciation of his strenuous and successful efforts he almost wished it had filled and sunk. “Waves of new expenditure as a result of new legislaton and continued legitimate growth and development of Federal business have swept over the economy boat and threatened to sink it, but steady constant throwing over of waste and continual stopping of leaks have kept it afloat notwithstand.- ing accumulating expenditures at times have gained slightly. And we are still bailing and plugging leaks. “In 1925 additional' new financial burdens were thrown on the executive departments_ totaling $120,000,000, which we absorbed, someway, some- how, with the exception of something less than §$15,000,000. Additional de- mands for 1926 as against 1924 made the alarming total of $224,000,000 and tested our economy machinery to the breaking point almost. We absorbed all but $49,000,000 of that great amount. $598,974,254 Surplus. “In the face of these facts, readily ascertainable, it is difficult to account for statements that we are effecting no economies. Such statements are made and presumably made in all sincerity. The man whose attention was called to an enormous stuffed tarpon in a glass case was doubtless sincere when he said, ‘The man who caught that fish is a prevaricator.’ “The last estimate for the current year—made within a few days—prom- ises a surplus of $598,974,254, to which you have made generous contribution with an expenditure brought down and held down to $2,975,235,050, which is $73,000,000 less thah we spent in 1924 and $25,000,000 less than our $3,000,000,000 limit. This has been effected, not only by curtailment of expenditures, but by stubbornly hold- ing the line and preventing increases. And this year we have had to provide additional millions for new needs arising from conditions not suscepti- ble «of administrative control. “After these years of struggle, after these weary months of sacrifice and striving, after weeks of deferred hope and doleful days of defeated aspira- tions, we have the coveted goal within reach, we have the prize fairly won. And copying the declaration of the young man whose pride of accomplish- ment was_wot fettered by rules of grammar, we can proudly blazon in glowing words on the flaunting folds of our triumphant banner the inspir- ing legend, ‘We seen®our duty and done it.’ s “I can conceive no possible contin: gency that can rob us of our $3,000,- 000,000 victory this year, but we have been so often repulsed, so frequently disappointed of our expected and well earned triumph that at this time we will content ourselves. with just a feeble cheer, reserving the rockets, red fire and Roman candles to the day when we can look back and say, “There it is! Look at it! They said we couldn’t do it. We have done it.’ “The failure of the second deficiency bill of lamented memory aided us to the extent of less than $20,000,000. We would have won had that bill become law. Saving of Personnel. “An important factor in this prom- ised victory is the Two Per Cent Per- sonnel Club, which contributes a sav- ing \in excess of $18,000,000 to the inspiting result. With' an average annual turnover of about 9 per cent and acknowledge humiliating defeat? “At that time and whenever since 1 have recalled the disheartening re- sults of those two hard-fought years, there has flashed through my mind the story of a famous fight between a Scotchman and an Irishman. They were to fight until one of the two indicated he had had enough by say- ing ‘sufficient” Right royally they fought—backward and forward—up and down—in and out—blow upon blow--fistwork and footwork—for & ‘minutes, 1 Ominutes, 15 minutes, 20 minutes, 25 minutes, and then the Scotchman_ faintly but distinctly gasped ‘sufficient” Said the Irishman. ‘I have been thrying for the last tin minutes t think of that blamed word.’ In our $3,000,000,000 contest we had fought gloriously, groggy at times, and at times perplexed, worried ,and wearied, but we never could think of the word ‘sufficient,’ so we carried on the fight into 1927—the current year. Economic Claims Justified. “In 1925 and 1926 we spent more than was expended in 1924. It is absurd, however, to point to these in- creases in annual expenditures as in- dicating that claims for economies in the Federal service are not justified. 1 seem in my illustrations to be drawn inevitably to the period of my rather uneventful youth. One day a party of boys, including the speaker, embarked in a small boat on a fishing trip off the coast of Maine. A heavy wind stirred up such a rough and choppy sea that the speaker, the youngest of the crowd, was ordered to bail out the boat while the rest of the crew desperately bent to the oars trying to make harbor, before the wind, which 'was increasing to a gale, reached its height. With a battered tin the bail- ing was prosecuted feverishly and diligently. It was impossible to keep the boat entirely clear of water, as SPECIAL NOPICE. FINISHED LIKE NEW: I PES™® B03d 15th st. n.w. 97.__Et 28 vears. e Ty b L, BE _RESPONSIBLE Lo toned o Ay person other ‘than velf. ENNE’ 5 BRID (2 igh_st.. Ngugatuck. Conn. 13" ORIENTAL RUGS. PAINTINGS AND A 1 furni a or. Security Stor- “. Main re " belonging 10 of the personnel in the Federal execu- tive civil service you were asked to make a saving of not less than 2 per cent by letting 2 per cent or more of these vacancies remain unfilled. Your response demonstrated the practica- bility of this device for reducing per- sonnel costs, and furnished further evidence of your earnest desire to take advantage of every opportunity for economy. While the final record of this effective effort cannot be given at this time, you can take pride in knowing that indicated savings are well in excess of $18,000,000, and that, with few exceptions, all the depart- ments and establishments qualified for club membership. “Shall this effective organization, with a record of $18,000,000 saved in one year, be disbanded? in fa- vor say ‘Aye!; opposed ° ‘The ‘noes’ have it and the Two Per Cent Personnel Club will continue its splen- did work through the next fiscal year for a twofold purpose—to effect need- ed savings and to afford our ambitious administrators opportunity for real constructive administration. who won in 1927 will, of course, pride- fully strive to repeat their successes the coming year. Those who for va- rious reasons failed to make the grade will have another chance, which I ag- sume they demand, to redeem them- selves in the year to come. Bills Paid Promptly. “Another helpful factor this year, and by no means a negligible’one, has been the prompt settlement of our bills for supplies, with regulting dis- count savings. When we last dis- cussed this subject a number of the Federal agencies had failed to join the prompt settlement and discount pro- cession. Today mnearly, all the Federal establishments have enlisted. There is a very. gratifying effort throughout the service .to pay bills promptly and win discounts. The first 10 months of this year yiel¢ed discount earnings of $870,837.70. ‘At his rate the dis- counts for the yearWill exceed $1,000,- 000, which is g'pproximately 1 per cent of the amoun't spent in making dicect purchases of supplies. Actual discount savings of /record from the beginning of our digcount drive up to and in- cluding April of this year total $4,- 293,473.99. This is a direct and sub- stantia) saving, but of'greater value D J. HARDEN . U, 8. W. V.. are requested to assem: ble at'the west ‘steps of the Capitol at 4:45 Sunday to participate i Flag Day vices. 'NEILL, Commander. 3 W. V = NOTICE TO_ STOCKHOLDERS. The “apnual meeting of the stockholders s American Fire Insurance Company of .. and the election of nige (9) an fis Company for the ensuing year wil eld at the office of the Company. No/ Seventh_ street n.w., on Thursday, Juye 5 Polls open’ frgm 1'am. 6 5 ERGMANN, Sccretary;, my14.21.28-64.11.13.14.15 THE BUSY )\’(AN OR WEMAN equires Pep. rgy is replaced by rest—sles.p. got it unless lhe”‘bed Qey am! .. to the/Government is the indirect ben- efit 7ot determinable in dollars and centss resulting from prompt payment of Hur bills. We are wiping out the reputation for slow payment honestly e/irned through the years. “Convincing and unanswerable proof of the steady advance we are making along the highway of efficient opera- tion, wise administration and watch- ful conservation of the Government’s resources i{s found in the progressive and striking reduction of the public debt. “Our national debt touched the clouds August 31, - 1919, when it reached up to what to you should be familiar fizures—$26,596,701,648.01. renovation eervice might ‘DI ke ,;flll lot_mare comlortuble: Pnona_i&.m Seet. BEDELL'S FACTORY, 610 E St. N.W./ December 31, last, you will remember, it had trained down to $19,074,665,- T NEVER DISAPPOINT BYRON S. APDAMS PRINTING IN A HURRY High grade, but Mot high priced. 512 11t/ St. N.W. A MILLION-DOLLAR —printing_plant squipped to handle every Rind of printing 40b. ‘The National Capital Press 1210-1212 D_§T. N.W. Phone_M. 650 ROOF PAINTING! Let us estimate on this most essential featu f home protection. Solid, dura- blo viork by vract While you're at it, get the best, roofers. 119 3raSt. S.W. Phone Main 933 337.35—a decrease in seven years of $7,522,036,310.66. June 30, next, it will be dowm to about $18,600,000,000, a reduction of $8,000,000,000 approxi- mately in a little less than eight years —an achievement too wonderful for words. New Light Is Coming. “The coming year promises another real and worth-while fight, in which the word ‘sufficient’ will play no part. The operating agencies think today they will spend next year $3,020,000,- 000, which is5 $45,000,000 in excess of our expenditure this year, and that is $45,000,000 too much. We must put the inspected and condemned mark on that $45,000,000. This will mean a reduction in your estimates of approximately, 1% per cent, Those | t/ need something to fight for, and that is just about big enough to furnish reasonable amount of _exercise for the brilliant administrative talent that so richly abounds in the Federal | service. It can be done. It should be done. With your loyal co-operation it will be done. Done. “In addition to the Two Per Cent Personnel Club, which should help our 1928 campaign to the extent of at least $18,000,000—for what we have done once we can surely do again— we have in the general reserve an old and valued friend which came to our assistance in the first year of the budget. It is simple, scientific and successful. Administrators put aside at the beginning of the year a certain percentage of appropriated funds to meet contingencies that cannot be foreseen. This wise policy has justified itself repeatedly, when in the hour of trouble, and with no helpful Con- gress available, emergencies have been met and great inconvenience and loss averted. The primary purpose of the general reserve is to provide funds for such emergencies, while saving is a secondary consideration. If the emergency does not arise the money will be saved. This secondary consid- eration, however, yielded a saving of $291,411,533.98 in the five years end- ing with June 30, 1926. The balance in the reserve for the current year is $52,318,135.67, of which we will save the larger part. The general reserve savings for the six years ending June 30, next, will be in excess of $320,000,- proper reserves, and then in time of trouble submit estimates for additional funds to meet alleged emergencies, are liable to face the story of Rufus and Narcissa. * ‘Rufus, whut does I git on my birfday?' “ ‘Shet yo’ eyes, honey." Dey's shet.’ 'Whut does yo' see, honey?" 1 sees nothin'.’ ‘Dat’s whut youse gwine to git.” 546,000 on Pay Roll. “We have 546,000 people on the Gov- ernment’s active pay roll. I wonder how many of these or how many of you gathered here can look back on the year just closing and point to a definite economy, a concrete saving, a constructive thing perform- ed during that period in the Govern- ment’s interest, in addition to or out- side the regular routine service which we may assume has been rendered. “‘A speaker was lecturing on for- estry. ‘I don’t suppose,’ said he, “that a single person here has ever done anything to conserve our valuable timber.” A moment of silence, and then a meek-looking little man in the rear of the hall arose and said: ‘I once shot a woodpecker.” We need a woodpecker club in the interest of a 100 per cent commitment of the people in the serv- ice to a crusade for small savings—a sort of shrapnel attack on that $45,- 000,000 for which we will be gunning next year. “The budget director herewith chal- lenges the people in Federal employ to solemnly pledge themselves to mgke some definite saving in the fiscal year 1928. It may be conservation of Gov- ernment time, it may be more eco- nomical use of Federal supplies, it may be actyal saving in money. It may be big, it may be little, but, big or little, it will be voluntary and will constitute a free-will offering to our economy and efficiency campaign. In the interest of those who may have no opportunity to do big things, but who, like the man who Kkilled the woodpecker, are desirous of making some sort of a showing, of making some sort of contribution to the cause, the Loyal Order of Woodpeckers is herewith inaugurated. It will embrace in its membership all those, who defi- nitely determine to do something more than perfunctorily to perform their usual and routine duties. An average annual saving of $1 on the part of the 546,000 active Federal employes will mean more than a half million dol- lars saved. Those, who enlist in this worthy cause will find recognition in/ the satisfaction that comes from faith- ful, honest effort, and can wear An their own consciousness the insighia of patriotic intent and the service medal of duty well performed. 1929 Maximum $3,500,000,000. “All hail to the Loyal Order 4f Wood- peckers, whose persistent’ tapping away at waste will make cheerful music in Government officés and work- shops the coming year.. No reports will be required and only such records kept as the agencies thémselves think necessary or desirable., The only re- quirement is tHat Federal executives see to it that this patriotic opportuni- ty be brought to th6 attention of every person on the ive Federal payroll. It is requested, however, that if any department, _¢stablishment, bureau, office, or ot organization achieve a 100 per ce enrollment the budget director be/notified. I am confident if these things be done, the humble wood perker will be given place in history %as symbol of a great national thrift erusade. “One year ago the President fixed the ‘maximum for 1928 estimates at $3,£00,000,000. This was exclusive of d¢bt reduction, tax refunds and cer- fain other excepted items. Estimates ‘to Congress exceeded that amount by $56,000,000, due entirely to legislation enacted subsequent to determination of the limiting amount. The max- imum for 1929 is $3,300,000,000, a fur- ther increase due to later legislation affecting several of the larger depart- ments. To the budget director is as- signed the duty of fitting estimates within the controlling maximum established . by the President. With your loyal and intelligent co-opera tion this can readily be done. With- out your help it will be a difficult task. It will be done. “Our Correspondence Club, inaugu- rated last January, is proceeding quietly but effectively. As a result of the mere announcement of the need and the .proposed effort, helpful remedies were applied here and there throughout the service in advance of specific recommendations. These scat- encouraging results. The Federal Board on Simplified Office Procedure, one of our active and constructive co-ordinating agencies, has the matter in hand, and will have something of value to report. I believe Govern- ment correspondence can be reduced 30 or more per cent without inter- ference with necessary functions. Working Together. “Edward Everett Hale said: ‘To- gether—one of the most inspiring words in the English language. Com- ing together is a beginning; keeping together is progress; working together is success.’ Here is the story of co- ordination in the Federal service. Get- ting the various agencies together, keeping them together and encourag- ing and assisting them in working to- gether is the particular province of the chief co-ordinator and his capable assistants. Centering in the various co-ordinating agencies in Washington, reaching into the field through the 7 area_ co-ordinators and the 238 active Federal business associations, the Government’s unique co-ordinat- ing organization carries the gospel of helpful, friendly co-operation to all of the Nation’s manifold and widespread activities. By means of this effective organization we are getting larger re- turns from Government supplies, money and time. A new and remark- able esprit has developed throughout the Federal organization. Helpful, brotherly co-operation has given added value to Government resources, new zest to Federal operation, and has heightened the interest and increased the efficiency of our faithful workers. Co-operation in Evidence. “People unfamiliar with pre-budget conditions cannot comprel;xend 5:0 revolution that has taken place in the attitude of Federal personnel and Federnl dgencles toward eqch other. tering efforts have already yielded Executive Commends Budget And Guarding of Expenditures President Coolidge spoke as follows last night at the semi-annual business meeting of the Government. “Members of the Government’s busi- ness organization: “We have been writing a new page in the history of governments these last six years. No less urgent than had been the call to arms was the call for relief from the gigantic burden which the World War imposed upon the people. They had made their sac- rifices to enable the Federal Govern- ment to meet the great emergency. It was for that Government to take the lead in the effort to restore their financial and economic structure. This ask it willingly assumed. The plan o accomplish it, the budget system, was prepared by the Congress. That act gave the Chief Executive the op- portunity of assuming his full re- sponsibility as the head of the busi- ness organization of the Government. It pledged the support of the Congress to budget principles of operation. That pledge has been faithfully kept. “It is only necessary to point to our prosperity to show the influence which better business in government has had on the welfare of the people. The progress achieved by this co-ordinated effort of the executive and legislative branches of this Government is beyond all expectation. If we hold the ground we have gained, and we must hold it, success will be complete. This will be just as difficult as the task of reach- ing our present milestone. Elimina- tion of non-essentials and direct sav- ings have about reached their limit. To hold our position will therefore re- quire even more care and attention. It will be aierpetual challenge to the ability and resourcefulness of those in charge of the public expenditures. United Counsel Indorsed. “It is essential that we take periodic counsel together. For this purpose we gather in open meeting twice each year. These meetings were a new de- parture in the conduct of the business of nations. We have found them nec- essary to co-ordinated action. Here we meet on a common footing, with one objective—the welfare of the peo- ple. These meetings are therefore of national importance. It is here we re- port to the people on our stewardship and plan our policies for future opera- tions. A business without a policy is a poor business. “We are conducting the greatest business in the world, and it is neces- sary that we have defined policies of operation. The achievements of these last years can be attributed to the fact that we have adopted such policies. We have reconstructed our finances. We are -rapidly rehabilitating our physical plant. All of this has been accomplished not alone because we have been more favored than other governments in the matter of income, but by sound scientific business man- agement—by the practice of economy: This has made possible the material reductions in our tax rates.’ It has enabled us to pay as we go, and at the same time vastly reduce ouf public debt and interest charges. Economy Is Safeguard. “I do not hesitate to say that one of the greatest safeguards of this Nation, financially, socially and moral- ly, lies in constructive economy in government. It will do much to de- feat attempts to undermine our tra- ditions . and disrupt our institutions. Econgmy does not mean the neglect of essentials. Rather' does it mean adequate provision for them by the elimination of all waste. It gives the ded protection which comes from the means to meet a time of emer- gency. The Federal Government has set an example not alone to the other governments in this country but to other nations in the practice of economy. - Extravagance may bring momentary pleasure and apparent benefit, but it creates a condition which is bound to affect the future adversely. In our operations we are building for more than the present. The foundatlon is being well laid with a support of the people in which we ‘While the speaker was visiting a Government agency in a distant city the official in charge was asked by the local pbstmaster for loan of Gov- ernment trucks to meet an emergency and thus obviate the expense of hiring transportation. Government trucks were idle and were promptly made available—trucks' controlled by one Federal agency doing service for an- other Federal agency. A prominent local business man, who was present, was greatly impressed by this evi- dence of real co-operation and asked how much money was saved thereby. ‘When informed that the loaning of Government transportation to post- masters during the congested Christ- mas season alone had saved $465,000, and that this was but one of many cases of similar savings due to co- operation, ' he said it was wonderful. And yet he did not know and could not understand that the wonderful thing about the transaction was the initiative of one set of officials in ap- plying to officials of other departments for help. He did not know and could not understand that the ready com- pliance of these other officials in granting the aid requested was an- other and greater wonder. He could not possibly know and he could not possibly comprehend the revolution that has taken place in the Fedcral service with regard to the co-operative utilization of Government resources. “‘A colored preacher who reveled in polysyllabic words was asked by one of his flock the meaning of the word ‘phenomenon,” which the pastor was using with great frequency and evi- dent relish. Said the preacher, ‘I takes pleasure in elucidating the meanin’ of that useful word. If you sees growin’ in the outskirts of our fair village a thistle bush laden with interestin’ if not invitin’ thistles, that's no phenomenon. You sees thistle bushes and thistles almost too frequent. If you hears a mockin’ bird floodin’ the air with sweet song, that’s no phenomenon. Mockin' birds is not uncommon. If while listenin’ to the song of the mockin’ bird you sees a kangaroo hoppin’ effectively if not graceful along the roadside, that's not in itself a phenomenon. There may be a circus in town with a menagerie attached thereto. But, my hearers, if you sees that kangaroo settin’ on that thistle bush, singin’ Jike a mockin’ bird, that's a phe- nomenon.’ “The confident call for help, the ready response, is the Federal rule today. This, my hearers, is the phe- nomenon. Making Everything Count. “There has been no let-up, and no let-up is contemplated, in the effort to make everything count for true economy. Word comes, not only from department and bureau heads, but from those holding more modest po- sitions in the service, of earnest de- sire and honest endeavor to maintain a high state of efficiency, and at the same -time make a record for econ- omy—efficiency and economy, the one impossible without the other. An employee of the Treasury Depart- ment, who has made a record for utilizing what theretofore had been regarded as waste material, was re- cently asked by the budget director how his salvage work was progress- ing. ‘Fine!’ was the answer; ‘we're saving the dust off spiders’ legs.’ For many years Government agencies and Government people have been ac- cused of gross waste and extrava- gance. If that Indictment were, ever. forever ‘past. find encouragement to continue our efforts in their behalf. “At these meetings we have for congideration our operations for three fiscal years. First,is the current year, fast drawing to a close. With less than three weeks remaining we are practically assured of a surplus of about $559,000,000. Our expenditures will be less than last year. We have not only held our position but have made an advance. There is cause for enormous satisfaction. I realize the tremendous contribution you of the Federal service have made toward bringing about such a successful re- sult. This meeting is the sixth mile- stone, marking increasing progress. Our main consideration tonight, how- ever, is next year's business and plan- ning for the year to follow—the fiscal vear 1929. “We are about to start a new year, for which you have your appropria- tions. They represent the peopleg’ money collected by the Congress to run the Government. It is your duty to see that these moneys are wisely spent. Those responsible for any waste of these moneys, those who by Jax administration fail to conserve them, are failing in their duty. We are not operating for profit in the commercial sense of the word, but we are operating for the profit of the people. The success of our opera- tions is measured by the contentment, the prosperity, the enlarged oppor- tunity of the people. Because of this our responsibilities assume a higher and more sacred character. Not Concerned With Income. “In carrying on the business for which you have your appropriations you are not directly concerned with Federal inceme. Your operations, however, have a direCt influence on the subject of income. To the extent that you conserve your appropria- tions and wisely plan your operations we shall require less money from the people. This is no time to advo- cate expansion in expenditures. The normal growth of the Nation will re- quire additional outlays, and our ef- forts should and must be to absorb these by more economical administra- tion. This means scientific business management, and it has been demon- strated that the budget system makes this kind of management possible. To perfect our business organization ‘and have it yield more and better service for each dollar spent must be our aim. The object hack of all this is to take a minimum of the people’s money consistent with giving the service to which they are entitled. We have already made stupendous progress in this direction. “The indications today are that our income for 1928 will be more than suf- ficient to cover our estimated expendi- tures. The forecast is that it will leave us with a substantial surplus estimated at around $338,000,000, as against about $599,000,000 anticipated for this year. “The fact that thls surplus of about $599,000,000 is in excess of the amount estimated in the Budget transmitted to the Congress December 6, 1926, might well, in the absence of explana- tion, lead to the belief that our reve- nues have greatly exceeded out ex- pectations. Such is not the case. The estimated aggregate receipts on ac- count of customs and internal reve- nue as set forth in that budget were $3,426,485,000, The latest estimtes in- dicate that these receipts will be $3,442,000,000, an increase of but $15, 515,000. In other words, in estimating revenues from a large variety of sources, amounting to almost three and one-half billion dollars, the Treas- ury, based on present estimates, erred by less than one-half of 1 per cent. The reasons for the gratifying size of the surplus must be sought else- where. On the side of receipts there is a moderate increase in credits from the sale of capital assets, such as railroad securities. On the other side of the ledger ordinary expenditures will be approximately $100,000,000 less than expected. This includes about $20,000,000 postponed to mext year be- cause of the failure of the second d An eplc could be written of the earn- est and courageous efforts of Federal organizations, and Federal personnel to banish waste and inaugurate thrift, Some day I hope to write that epic. It will be replete with stirting and intriguing ancedotes of earnest effort, fertile resource, ingenious contri ance, careful planning and courage- ous, intelligent administration. It has called for hard work, self-denial and sacrifice. As one officlal put it: ‘We've been chliged to scratch gravel.’ “A. religioiffiy inclined young man had a friend \vho had never attended church.. He finally prevailed upon the friend to accompany him to the place of worship on a Sunday morning. As the beautiful- service proceeded, the restful, mellow light smiling through the stained-glass windows, the rich harmonies of the sweet-toned organ, the fresh and appealing voices of the choir, the inspiring words of the preacher, the subdued responses of the people and the atmosphere of de- votion that characterized the service apparently made a great impression on the visitor. ‘What do you think of it?’ asked the young man. Said the visitor, ‘It beats the devil.’ Said the other, ‘That's what it’s intended for." “K budget policy has been re- sponsible for close saving, has com- pelled utilization of accumulated ma- terial and use of waste stuff, has so restricted available funds that resort must be had to all sorts of plans and devices to do the job, if Federal peo- ple have been obliged to scratch gravel, if they have been driven even to save the dust off spiders’ legs, we are content, That's what it is in- tended for. Lauds Federal Organization. “Mr. President, in the Army we say a regiment is as good as its colonel, The most eloquent tribute I can pay you and your leadership is to’'point to this splendid organization which marches and fights under the honored title of the Federal service, and which in its various engagements in the in- terest of thrift and efficiency has been inspired and made effective by your wise policies and masterly direction. ‘With the signing of the armistice the war ended for those serving with th colors. For the Federal service th war continued. Vexatious questions and difficult situations called for solu- tion. With the years came new and important and trying problems, but the fight continued, and today we can justly claim victory. The debt is go- ing down, expenditures are held in check, the country’s great interests are conserved, its important activities well administered and peace and con- tentment prevail' But, as you have stated, this happy conditiop is no war- rant for discontinuance of the war against waste, no reason for relaxing our effort for better administration, no excuse for failure to preserve and hold what we have gained. “We, in the Federal service, are still in the field—not with beat of drum, or volleying musketry, or rattle of ma- chine gun, but battling loyally day by day, faithful and true to the day’'s modest tasks, to the routine work that must be done—consecrated to the country’s necessary service. “‘Who loves his country will not rest ledge alone, e breast 1d of comman 18 strong to 1i s i . "ot asisheq (0" clagm e ficlency bill. The tax refunds will fall $25,000,000 short of the estimate, due to a change in the revenue law. Then, again, the fact that the French debt settlement has not been ratified has necessitated a revision of the amount chargeable under the head of debt retirement. - Value of Surplus Doubted. “As a guide to the future this year’s surplus is of doubtful value. It in- cludes a number of extraordinary re- ceipts that can not be counted on for more than a limited period. Back in- come taxes and the capital-stock tax will yield $287,000,000. Deducting from this $125,000,000 of internal gevenue refunds, leaves a net income of $162,- 000,000 from a source which will rap- idly grow smaller. Collections from farm-loan bonds and .other miscella- neous securities will make a non- recurring item of $63,000,000. Rail- road receipts, which can not be looked to for any substantial amount after 1929, will account for $90.000.000. These items alone aggregate $315,000,000 of our 1927 surplus. ‘““We are sure of a surplus of $599,- 000,000 for this year, but the $338,- 000,000 for next year, 1928, is neces- sarily an estimate. But here it is im- portant to point out that no less than $133,000,000 of our expected receipts for next year will be derived from the sale of capital assets. This resource is well nigh exhausted. The proceeds thereof, because of their non-recurring character, can more appropriately Be devoted to debt rather than tax re- duction. Moreover, in 1928 back-tax collections will continue to exceed re- funds, adding to that year a revenue which we can not safely count npon for future years. - “In considering the possibility of tax reduction we must keep in mind that our revenue laws can not be written from the standpoint of a sin- gle year, but must be expected to yield adequate revenue over a period of years. It is essential therefore to dis- count temporary and non-recurring items and to base the estimated reve- nue on those resources which can be looked upon as essentially permanent in character, We have no fear our present revenue laws will not pro- duce ample income to carry on the business of the Government. But this does not justify an enlargement of our expenditure program. Rather does it dictate and demand that we make renewed effort to keep within our present expenditures. One thing is certain. Unless we succeed in holding expenditures at about their present level, hope of further tax reduction will be gone. Cut Interest Charges. “In the face of each of the three reductions in taxes since the fiscal year 1921 we have continued to ac- cumulate surpluses at the end of each year. We should not overlook, how- ever, the great influence these sur- pluses have had in making tax reduc- tion possible. Their application to the further reduction of the public debt has permanently reduced our interest charges. It has been an investment for the people of their own money. In the business of government, as in pri- vate business, the time to liquidate indebtedness is in the time of prosper- ity. The reduction of fixed charges serves a twofold purpose. It mate- rially assists in maintaining prosper- ity and would be particularly helpful in adversity. “There could be no more striking illustration of the benefit accruing from this policy than is furnished by a_comparison of the interest charges of the years 1927 and 1928. Due to debt reduction and the refunding oper- ations conducted by the Treasury, in- terest payments next year will be $63,- 000,000 less than for the current year. This is a most remarkable showing. It is a permanent annual saving. The mere recital of the figures brings out more clearly than any words the great burden of interest charges. From April 6, 1917, to June 30, 1927, the Government will have paid the stu- pendous sum of $8,318,571,388 in in- terest alone, “Another task now facing you is the preparation of your estimates for the fiscal year 1929. We are striving as always to pave the way for further reduction of debt and of taxes. This in itself necessitates unremitting ef- fort to hold the level of' our expendi- ture program. After a careful study of our probable financial condition in 1929, it is my desire that the estimates of appropriations for that year be held within a total of $3,300,000,000. This is exclusive of reductién of the debt, the postal service and tax refunds. This maximum has not been fixed ar- Open for Quick Sale SOUTH OF CONN. AVE. BRIDGE Six large bright rooms, tiled bath, comfortable porches, two-car garage. in erfect condition thronghout. Al improvements. An ideal house in a select location. Inspect Sunday After 2 O’clock. 2436 20th Street STONE & FAIRFAX 804 17th St. Main 2424 . “Over forty years of real service.” six-room REDUCED RENTS NEW COLORED APARTMENTS The exclusive and attractive Willard Mansions For Refined Colored People 1731 Willard St. N.W. Near 18th and Florida Ave. Beautiful apartments of three rooms, tiled baths. spacious clos- ets, large gas ranges, floor plugs, excellent_janitor service. ELEVATOR Open and Lighted Until 10 P.M. Rents $49.50 and up Seo Resident Manager, Apt. 103 N FOR. SALE To Close An Estate Apt. 402 Netherlands The (Co-Operative) & Rooms, Recp. Hall & Bath Apt. 56 The Avondale (Co-Operative) 4 Rooms and Bath 5 Inspection of Above Apartments By Appointment Real Estate Dept. 15th and Penna. Ave. Viain 4815 bitrarily. It is the result of careful study of probable financial conditions in 1929. Fixed charges have been bal- anced against the best possible esti- mate of receipts. In establishing this maximum for estimates for 1929 I ex- pect the budget director to limit the calls of the various departments with- in that amount. His task will be sim- plified by the full co-operation which he will have from you. Careful Estimates Urged. “If you view it absolutely neces- sary to ask for more funds for cer- tain activities for 1929 than you have for the current year, every effort should be made to effect a correspond- ing saving in your other activities. T am sure your estimates for 1929 will indicate your continued loyal support of the well established and definitely understood policies we have been fol- lowing. We have learned that con- structive economy has not impaired efficient administration, but rather has improved it. We have placed our house in order and have pledged our- selves to keep it in order. Each year has shown a marked improvement in the conduct of our business, I know that your estimates for 1929 will show a continuation of this improvement. “In connection with your plans for 1928, I reiterate the principle estab- lished during these budget years, that the amount made available by the Congress constitutes the maximum of expenditure and not the minimum. You must divest your minds of thought of possible accessions to the amounts given and administer your activities with the purpose of effect- ing every proper saving. You must consider the grant of budgetary funds made by the Congress as final for the year for the purposes appropriated. Except to meet the requirements of new legislation the submission for executive consideration of estimates for additional funds should be re- stricted to cases of absolute urgency arising from conditions which could not have been anticipated in the an- nual budget. ‘In recent years actual deficits have been few, and in most cases unpreventable. There have been cases, however, where adminis- trators have so obligated their funds n the first months of a year that un- less Congress afforded relief necessary activities would have been stopped. I am determined there shall be an end to procedures of this sort. Good ad- ministrators will plan their operating campaigns to conform with the ap- propriations made by -the Congress. There is no place in the Federal serv- ice for other than good adminis- trators. Flood Reliet Extended. “The vast, fertile and productive reaches bordering the Mississippi and its tributaries have been subjected to great disaster. The loss of life and property is appalling. All that possi- -bly can be done to alleviate distress and suffering is being done. As it de- velops that additional funds are re- quired for this purpose, I am con- fident they will be provided. Control measures that were considered by all as ample to full protection have proven inadequate. Such a disgster must never happen again. A’ survey is now being ‘made to determine what is needed. That survey will be laid be- fore the Congress. From a business standpoint we must anticipate from this disaster a reduction in our am confident this will be an added tn- centive to effect savings elsewhere. “Before turning this meeting over to Gen. Lord, I want you to know I appreciate what you have done. I am sure the people also realize and value your efforts. They are giving closer and closer attention to the op- erations of their Federal Government Their interest is essential to its per- petuation. They know what has been done and what is being done in their behalf. There must be no relaxation of effort. Wiser from the lessons of the year just closing, we should the more intelligently attack the prob- lems facing us the coming year, and more scientifically appraise our needs for the year following. To do more work and better work with a smaller outlay of the taxpayers’ money is the supreme test of successful admin- istration. “I now turn the business meeting over to the director of the Bureau of the Budget. If fidelity and ability, untiring industry and consistent pur- pose ever entitled any man to the considerate appreciation of his fellow countrymen, such appreciation is due to Gen. Lord. Because of his effective leadership, supported alike by the Congress and the administrative forces of the different departments, the burdens of the people of this Na- tion are markedly less, their prosper ity is infinitely greater, their whole life is richer and more abundant. He not only preaches the word, but he lives by the word. It is a pleasure to listen to him and an honor to serve with him, Gen. Lord.” UNION VETERAN SUICIDE. Joshua Thomas, 86, Hagerstown, Found With Throat Slashed. Special Dispatch to The Star. HAGERSTOWN, Md.,, June 11.— Joshua Thomas, 86-year-old Civil War veteran and one of the most active members of the Grand Army of the Republic, committed suicide at his home here last night by slashing his throat with a razor. His wife, upon returning home, found him dead in the bathroom. He had been suffering from a nervous disorder. For Immediate. - SALE 3717 Fulton St. N.W. SEMI-DETACHED HOME 2.STORY & ATTIC BRICK 8 ROOMS ‘& 2 BATHS GARAG $17,000 Inspection by Appointment eal Estate Dept. 728 15th St. N.W. Main 4815 prospective revenue and an increase jn our prospective expenditures. I 1900 H A few apartments fine modern building, ernment offices. service. RENTS REDUCED The Woodside Apts. 14 Corner of 19th and H Streets room, kitchenette, dining alcove and bath are now available at greatly reduced rent in this * Apartments, furnished and unfurnished, as low as $47.50 per month. Resident manager. T. F. Schneider, Jr., Agent St. NW. . of one room, dressing convenient to all Go All-night elevator 1025 15th St. N.W. %27 7 w Four Rooms and Br&';ir Creek Park and 16th Five Rooms Reception Resident Manager on Adams 8710 1516 K 2 We Are Building 72 Sz Rooms and Bath—Hotwater Setlon: "with concrete tivets. cars saier“°Call early and wet first ch 1311 H.STREET RENTS REDUCED In One of Washington’s Most Exclusive and Well Serviced Apartments Phillips Terrace Apartment 1601 Argonne Place Just North of Columbia Road at 16th St. Washington's Foremost Residential Section One Room, Kitchen and Bath with Murphy Bed, $42.50 and One Room, Kitchen, Dining Alcove and Bath, Murphy Bed, $55.00, $57.50, $60.00, $62.50 Two Rooms, Reception Hall, Kitchen, Dining Alcove and Bath, M Bed, $67.50, $72.50, $80. Murphy Bed and Porch, Five Rooms, Reception Hall and Bath with Large Porch, $150.00 24-Hour Telephone and Elevator Service William S. Phillips & Co., Inc. lc——lolc———ojc———]o/c———| 'INSPECT TONIGHT OR SUNDAY You Can Buy One of These Homes for the Rent You Are Now Paying Why Not Come Out? $100 CASH Monthly Payments rd& 4th & T & U Sts. N.E. Desirable, Convenient Location— bt but I suburbs. but In a o H.R.HOWENSTE N N 7 s Overlooking Rock ”:‘-’ $105, $117.50 St. g Bath, $100.00 Premises at all Times 7, St. N.W. \ N 7 | | | m (@ jolc———jol———2lal——— ol ——2 o % < New Homes at This Heat—Electrio Lights—Big Porel . convenient, buill several stores for INCORPORATED @ .NORTHWEST'