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ANNUAL REPORT OF THE
SECRETARY OF THE TREASURY
ON
THE STATE OF THE
FINANCES
FOR THE FISCAL YEAR
ENDED JUNE 30
1929
WITH APPENDICES
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1930
TREASURY DEPARTMENT
Document No. 3010
Secretary
CONTENTS
Page
Business and financial conditions during the fiscal year 1929
Business conditions
.
Financial conditions
Budget results
The surplus
1
.'
Receipts
Expenditures
.
The public debt
.
General review of operations
Postwar debt reduction
Treasury war-savings certificates
Cumulative sinking fund
Condition of the Treasury
General fund of the Treasury
The currency trust fund and the gold reserve fund
Gold held for the Federal Reserve Board
Estimates of receipts and expenditures
Tax reduction recommendation
Avoidance of international double taxation
Income tax administration
Status of work..o
^
•
Cases pending before the Board of Tax Appeals
Final agreements
.
Collection from transferees
Reopening of cases
Personnel
;
Refunds and credits
Future work
Conclusions
.
Treasury biUs.
._..
.
Tax exemption of Federal securities
Issue of new small-size tjurrency
Obligations of foreign governments
Austria
.
Czechoslovakia
France
Greece
Yugoslavia
Receipts from Germany and the Young plan
.
Army costs
Mixed claims
Credit conditions
.
'.
Branch and group banking
^a^3
1
1
4
5
6
7
11
11
11
14
• 16
16
17
17
18
19
19
22
26
28
28
29
33
34
34
36
35
37
38
38
41
42
45
47
48
49
50
62
62
54
66
66
59
IV
CONTENTS .^
Page
Federal farm loan system
.
;
61
Reorganization of Farm Loan Bureau completed.
61
Progress and improvements
62
Special problems
64
Legislation
.
.
66
Personnel
:
66
Federal public buildings program
66
General
..
.
66
Projects outside the District of Columbia
67
Projects in the District of Columbia
:..
.
.....
68
Meetings on the development of the city of Washington
68
Treasury administration of alien and mixed claims .
^
69
Germany
^
.
•
70
Austria .;.
.
i
74
Hungary
.....
.
. . . . 76
War Claims A r b i t e r . . . :
.. —
76
The Porto Rican Hurricane Relief Commission
.
.
•' 76
Bureau of Customs.
^.^^
^i^
^^_._.....,'
78
Coast G u a r d . . _ . . . . i . . . :
.
.
ii.
81
Bureau of Engraving and, Printing
_.__.
_.
-r-82
Prohibition law enforcement._..._.,
....
•
^^....._._.
83
Narcotic law enforcement
.
. .....-i
.....
86
Public Health Service.:..
.........:....^:_...
86
Tablet commemorating the Webster-Ashburton treaty . : . . . . . . . _ . .
89
ADMINISTRATIVE REPORTS OF BUREAUS AND DIVISIONS
Accounts and Deposits, Office of the Commissioner of_.._....
..
Railroad obligations
............. — ...
Section 2 0 4 . . .
Section 209
.
i.......
Section 210
..
.........
...""
Securities owned by the United States Government._._
__1.
Trust funds administered by the Treasury
......._. — .....
Adjusted service certificate fund
;—^.
Civil service retirement and disability fund
....J.._l_.
District of Columbia teachers'retirement fund..___:
'
Foreign Service retirement and disability fund
.
_..J_._
Library of Congress trust fund
:..::'J
United States Government life insurance fund
.--.-.--.
Division of bookkeeping and warrants
.
....
Organization and functions
.
;'_...! — .
....
Warrants
....
Appropriations
Receipts and expenditures
—\...:. '
District of Columbia account
^
....
Alien Property Custodian account
.......
Outstanding liabilities
.
::...:_.
Duplicate checks
..._..:.'
Contingent expenses, public moneys
..
1 _.:..•..
Recoinage of uncurrent gold, minor, and sUver coin
.:....!.
Budget matters
..
....._^
Offers of compromise.._
^......ii.
Guaranty deposits by public^building contractors, etc
93
93
93
94
94
96
96
96
97
98
100
101
103
104
104
106
106
107
108
109
110
110
110
Ill
111
Ill
111
CONTENTS
Accounts and Deposits, Office of the Commissioner of—Continued.
Division of d e p o s i t s . . .
-...
General depositaries
•.
Limited depositaries
.
Insular depositaries
Foreign depositaries
Special depositaries
.
A m o u n t of deposits
°
Interest on deposits
.
Actuary, Government
Appointments, Division of. . 1
.
Employees of the Treasury D e p a r t m e n t
Section of surety bonds
.
Budget a n d improvement committee
Chief clerk a n d superintendent, office of
.
•
Housing of Treasury activities
.
General improvements
=
•-.
Painting
...
Combined appropriations
.
Sites for public buildings
Seville exposition
.
Committee on simplified office procedure
Coast Guard
Protection to navigation
.
:
Flood relief service
Enforcement of customs and other laws
Communications
:
..
Equipment
.
-J
T h e academy, stations, bases, repair depot, etc
Personnel
Award of life-saving medals
.
s
.,
Appropriations, expenditures, and balances
Comptroller of the Currency
.
National banks organized, consolidated, insolvent, in voluntary
liquidation, and in existence
•
.
: —.
Condition of national banks
.
Banks other t h a n national
..._All reporting banks
Customs S e r v i c e - _ .-..
Receipts
...
Volume of business
.
,..
Outstanding accounts
^
....
Appraisers' stores
:
:.
Extension of port limits
.
Commercial trans-Atlantic travel by air
Drawback
_-.
Undervaluations
•
^
' Patrol activities
.
Activities of the customs agency service
Disbursing clerk
,. .
Engraving and Printing, Bureau of
.
Enrollment and disbarment of attorneys and agents, committee on
V
Page
Ill
112
112
112
113
113
113
113
114
115
116
115
117
119
119
119
120
120
121
121
121
122
122
124
126
126
127
129
131
132
133
134
134
136
138
140
144
144
146
148
148
149
150
150
150
151
152
155
156
164
VI
CONTENTS
Page
Federal Farm Loan Bureau
1..
166
Operations of Federal land banks
^
166
Operations of joint stock land banks
167
Receiverships
.
168
Operations of Federal intermediate credit banks
169
Financial and economic research, section of
.
171
Internal Revenue, Bureau of..
.
173
General
.
173
Internal revenue receipts
.
173
Refunds
173
p n
Cost of administration
.
.
' 174
Income Tax Unit
•.
^.._
'.
174
Examination of returns
174
Additional revenue
175
Claims and overassessments
176
The audit in Washington
:
176
The audit in the
field
..-.
176
Records division
^
.
177
Reduction in number of 60-day letters mailed as related to
appeals
filed
.
•177
Personnel
..-...
178
Special advisory committee
178
MisceUaneous tax unit
..
179
Estate taxes
:
.
179
Miscellaneous taxes
.
__.
180
Tobacco taxes
.
"
.
. — _:
182
Appeals and review section
u
:
182
Accounts and collections unit
---'^83
Collection accounting division
•.
..:.
183
Collectors' personnel, equipment, and space division
..
.
186
Disbursement accounting division
—.
^
186
General counsel's office
.
.^.186
Appeals division
._
.
•.-..—
186
Interpretative division
^
.
188
Civil division
i.
.•_..—
188
Penal division
.
189
Review division
—
190
Administrative division
...
190
Mint Bureau
..-. - . °191
Institutions of the mint service
^^'
—
..
191
Coinage
. ,
i
191
Edison medal
-- — .
191
Gold and silver receipts and transfers
.
192
Refineries
..i..
-.
.
192
Additions and improvements
193
Gold and silver in the United States
194
Appropriations, expenses, and income
195
Deposits of gold and silver, income, expenses, and employees, by
institutions, fiscal year 1929
196
Personnel classification officer
197
Appeals and classification sheets
:
.
197
Efficiency ratings
198
L
CONTENTS
^
Vil
Page
Prohibition, Bureau of
.
199
Organization and procedure
.
^ 199
Activities
.
.
' 200
Personnel
..
202
Narcotics
.
.
204
Public Debt Service.:
205
Division of loans and currency
_.
205
Issue and retirement of securities
.
205
Individual registered accounts activities
207
Claims
.
..
,.
208
Safe-keeping of securities
208
Mutilated paper and redeemed currency
208
Publicity
........
.
.
209
Personnel
.
.
......
209
Register of the Treasury
.
209
Division of public debt accounts and audit
212
Division of paper custody
.
213
Public Health Service
215
Division of' sanitary reports and statistics
.
215
Division of foreign and insular quarantine and immigration...
216
Division of domestic quarantine
219
Division of scientific research
. 222
Division of marine hospitals and relief
.
224
Division of venereal diseases....
:..
225
Narcotics division
.
226
Division of personnel and accounts
.
227
Secret Service Division
229
Supervising Architect, Office ofthe
..
-230
Operations under the public buildings construction program
..
230
Remodeling and enlarging public buijdings
238
Sites.
..'
239
Expenditures, liabilities, and unencumbered balances
240
Supply, Division of
241
Expenditures from various appropriations
241
Stationery supplies
....
244
Printing and binding
.
246
Postage
.
1.._.__._.
247
Department advertising
.
248
Engraving work.._.
248
General Supply Committee
248
Treasurer of the United States
:
262
War Finance Corporation
257
EXHIBITS
THE PUBLIC
DEBT
Issues of December, 1928
Exhibit 1. Offering of certificates of indebtedness. Series TS2-1929
(4J4 per cent) and Series TD-1929 (4>i per cent) (press releaise, December 7, 1928, with Department Circular No. 411)..„
...
Exhibit 2. Subscriptions and allotments, certificates of indebtedness.
Series TS2-1929 and Series TD-1929 (from press releases, December 13,
1928, and December 20, 1928, revised)
261
263
VIII
''
^CONTENTS
Issue of March, 1929
Pag«
Exhibit 3. Offering of certificates of indebtedness. Series. TD2-1929
(4^ per cent) (press release, March 7, 1929, with Department Circular
No. 413)
....
Exhibit 4. Subscriptions and allotments, certificates of indebtedness,
Series TD2-1929 (from press releases, March 13, 1929, and March 14,
1929).-....
.
264
266
Issue of June, 1929
Exhibit 6. Offering of certificates of indebtedness. Series TM-1930
{b)i per cent) (press release, June 7, 1929, with Department Circular
No. 414)
....
.
.
Exhibit 6. Subscriptions and allotments, certificates of indebtedness,
Series TM-1930 (from press releases, June 12, 1929, and June 14, 1929,
revised)-..
.
267
269
Purchase of Treasury notes, July, 1929
Exhibit 7. Offer to purchase Treasury notes. Series A-1930-32 (press
release, July 11, 1 9 2 9 ) . . .
..•
:.
Exhibit 8. Purchase of Treasury notes, series A-1930-32 (press release,
July 17, 1929)
.
269
270
Issue of September, 1929
Exhibit 9. Offering of certificates of indebtedness. Series TJ-1930 (4J^
; per cent) (press release, September 6, 1929, with Department Circular
No. 4 1 7 ) - . . ...
Exhibit 10. Subscriptions and allotments, certificates of indebtedness,
: Series TJ-1930 (from press releases, September 11, 1929, and September
13, 1929)
.
....'
.-..-.
:
270
273
Treasury bills
Exhibit 11. Statement of Secretary Mellon in connection with the bills
introduced by Senator Smoot and Representative Hawley authoriz^ ing the Treasury Department to sell Treasury bills on a discount basis
(press release, AprU 22, 1929)
.
Exhibit 12. Treasury Bills, an address by Undersecretary of the Treasury
,. Mills, AprU 24, 1929, before the Forum of Washington Chapter,
American Institute of Banking, Washington, D. C .
Exhibit 13. An act to amend section 5 of the second Liberty bond act,
as amended (Public, No. 11, 71st Cong., H. R. 1648)
273
275
280
TAXATION
Exhibit 14. The Administration of the Federal Income Tax, an address
by Undersecretary of the Treasury Mills before the Bar Association
of the State of New York, New York City, January 19, 1929
Exhibit 15. Statement by Secretary of the .Treasury Mellon concerning
the publication of refund decisions of the Commissioner of Internal
Revenue (press release, March 14, 1929).^
281
287
CONTENTS
IX
OBLIGATIONS OF FOREIGN GOVERNMENTS
. Austria
. ':
Page
Exhibit 16.'Statement by Undersecretary of the Treasury Mills before
• the Ways and Means Committee, December 7, 1928, submitting a
proposed agreement for the settlement of the relief indebtedness of
Austria to the United States (press release, December 7, 1928).
^•- 289
Exhibit 17. Joint -resolution to authorize the Secretary of the Treasury
to cooperate with the other relief creditor Governments in making •
it possible for Austria to float a loan in order to obtain funds for the
furtherance of its reconstruction program, and to conclude an agree-.
ment for the settlement of the indebtedness of Austria to the United
States (Public Res., No. 81, 70th Cong., H. J. Res. 340)
L
299
" '
• '
France
.
Exhibit 18. Joint resolution authorizing the ppstponement of the date ,
of maturity of the principal of the iridebtedness of the French Republic
to the United States in respect of the purchase of surplus war supplies
(PubUc Res., No. 20, 71st Cong., H. J. Res. 80)
Exhibit 19.-Statement of the President of the United States concerning
the ratification by France of the agreement for' the settlement of the
French indebtedness to the United States (press release, July 28, 1929)..
Exhibit 20. Statement of Secretary of the Treasury Mellon concerningthe ratification by France of the agreement for the settlement of the '
French indebtedness to the United States (press release, July 28/ 1929)^
Exhibit 21. Text of the notes exchanged between Secretary of the-Treas- '
ury MeUon and the French ambassador constituting • the - agreement
between France and the United States providing for the postponement
of the date of the maturity of the principal of the indebtedness of •••
France in respect of its purchase of surplus war supplies iriaturirig
• August 1, 1929 (press release, July 31, 1929)..^.^^
.^^::..._.^.....
...
Greece
302
302
303
•.,
Exhibit 22. An act to authorize the settlement of the indebtedness of
the Hellenic Republic to the United States of America and of the
differences arising out of the tripartite loan agreement of February 10,. .
1918 (Public, No. 747, 70th Cong., H. R. 10760).
.
.....
rExhibit 23. Statementof Secretary of the Treasury Mellon concerning the
settlement of the Greek indebtedness to the United States (press release,.
May- 10, 1929)..,..
.
..._._...
_.._.__...
Exhibit 24. Agreement for the funding of the Greek indebtedness to the
United States
1
__.:......_...
......
Exhibit 25. Schedule of payments to be made by Greece on the 4 per cent
loan of $12,167,000, authorized by the act of February 14, 1929
:.
301
305
306
308
318
Kingdom of the Serbs, Croats, and Slovenes
Exhibit 26. Final exchange of obligations under funding agreement (press
release, December 1, 1928)
..
318
General
Exhibit 27. Statements of the Treasury covering payments received from
the several foreign governments on account of their indebtedness to
the United States (press releases, December 16, 1928, and June 15,
1929)
319
X
CONTENTS
SMALL-SIZE CURRENCY
Page
Exhibit 28. Identical letters, dated January 21, 1929, from Secretary of
the Treasury MeUon to the President of the Senate and the Speaker of
the House of Representatives relative to the issue of small-size nationalbank notes (press release, January 22, 1929)..
Exhibit 29. The New Currency Issue, an address by Assistant Secretary of
the Treasury Bond, May 17, 1929, before the Missouri Bankers Association, Excelsior Springs, Mo
.
Exhibit 30. Statement of Secretary of the Treasury Mellon concerning
the new small-size currency (press release, June 3, 1929, with Department Circular No. 415)
1
Exhibit 31. Copy of the letter dated June 3, 1929, addressed to the president of each national bank relative to the issue of small-size nationalbank notes
Exhibit 32. Designation of paper currency issues (Department Circular
No. 416)
.....
324
324
330
333
335
ALIEN PROPERTY AND MIXED CLAIMS
Exhibit 33. Temporary 5 per cent participating certificate, dated January
15, 1929, issued by the Secretary of the Treasury to the Alien Property
Custodian, representing an investment of $8,500,113.15 as authorized
by the settlement of war claims act of 1928
.
Exhibit 34. Agreement effected by exchange of notes between the United
States and Germany as to the extension of the jurisdiction of the Mixed
Claims Commission, United States and Germany, signed December 31,
1928
.
.
^-...
.
Exhibit 35. Letter from the Secretary of the Treasury to the Austrian
minister at Washington, August 22, 1929, relative to the Austrian
special deposit account, together with statements in connection there, with.
....
..
Exhibit 36. Statement by Secretary of the Treasury Mellon relative to
the Austrian special deposit account (press release, August 22, 1929)..
335
336
338
356
PUBLIC BUILDINGS
0
Exhibit 37. The Government and Architecture, an address by Undersecretary of the Treasury Mills, February 25, 1929, before the American
Institute of Architects, New York City
Exhibit 38. Plan of the City of Washington, an address by Secretary of
the Treasury Mellon, April 26, 1929, at a meeting on the development
of the city of Washington, Washington, D. C
356
361
MISCELLANEOUS
Exhibit 39. Joint resolution for the relief of Porto Rico (Public Res. No.
74, 70th Cong., H. J. Res. 3 6 2 ) . .
.
Exhibit 40. Statement by- Undersecretary of the Treasury Mills before
the Committee on Ways and Means, February 27, 1929, relative to
amendments to the administrative sections of the tariff act (press
release, February 27, 1929)
.
363
365
CONTENTS
XI
TABLES
RECEIPTS AND EXPENDITURES
General tables
Page
Table 1. Receipts and-expenditures for the fiscal year 1929, classified
: according to funds (revised daily statement basis)
375
Table 2. Comparison of detailed receipts for the fiscal years 1928 and
1929 (warrant basis)
.
377
Table 3. Comparison of detailed expenditures chargeable against ordinary
receipts for the fiscal years 1928 and 1929 (checks issued basis)
* 385
Table 4. Summary of ordinary receipts, expenditures chargeable against
ordinary receipts, and surplus or deficit, for the fiscal years 1916 to
1929 (daily statement basis)
394
Table 5. Ordinary . receipts, expenditures chargeable against ordinary
receipts, and surplus or deficit for the fiscal years 1916 to 1929 (daily
statement basis)"
^
395
Table 6. Receipts and expenditures for the fiscal years 1791 to 1929
(warrant basis)
400
Table 7. Summary of ordinary receipts, expenditures chargeable against
ordinary receipts, and excess of receipts or expenditures, by months,
from July 1, 1927, to October 31, 1929 (daily statement basis)
412
Table 8. Expenditures, by months, classified according to departments and
establishments, for the fiscal year 1929 (daily statement basis)
414
Specific receipts and expenditures
Table 9. Comparison of detailed internal revenue receipts for the fiscal
years 1928 and 1929 (collection basis)
..
Table 10. Internal revenue receipts, by sources, for the fiscal years 1863 to
1929 (collection b a s i s ) . . . . '
:.
.
Table 11. Internal revenue receipts, by months, total, and by present
major sources, July, 1927, to September, 1929 (collection basis)
Table 12. Internal revenue receipts, by States and Territories, for the
fiscal years 1928 and 1929 (collection basis)
:_
Table 13. Customs duties (estimated), value of imports entered for consumption, and ratio of duties to value of dutiable imports and to value
of all imports, for the years 1867 to 1928 (on basis of reports of the
Bureau of Foreign and Domestic Commerce)
.
Table 14. Customs duties (estimated), and ratio of duties to value of
dutiable imports, by tariff schedules, for the years 1890 to 1928 (on
basis of reports of the Bureau of Foreign and Domestic Commerce)
Table 15. Customs statistics, by districts, for the fiscal year 1929 (collection basis)
.
;
Table 16. Customs receipts, by districts, for the fiscal year 1929 (warrant
basis)
.
.
Table 17. Panama Canal receipts and expenditures for the fiscal years 1903
to 1929 (warrant basis)
,
.
418
419
425
426
427
429
434
438
439
Estimates of receipts and appropriations
Table 18. Actual receipts for the fiscal year 1929 and estimated receipts
for the fiscal years 1930 and 1931 (on basis of reports from the Bureau of
the Budget)
.
439
^XII
CONTENTS
'
Table 19.^ Appropriations for 1930 compared with estimates of appropriations for 1931 (on basis of reports from the Bureau of the Budget)
Table 20. Appropriations for the fiscal years 1914 to 1930, including
;:• estimated permanent and indefinite appropriations and deficiencies for
prior years . . . - -Table 21. Accountability statement of appropriations, by acts of Congress,
placed upon the books of the Treasury Department during the fiscal
7-,;year 1 9 2 9 . . .
.___^...
,
Table 22. Appropriations, expenditures,, amounts carried to surplus fund,
; /and unexpended balances for the fiscal years 1911 to 1929 (warrant •
basis) __^_
.
^
._
.
^ ,.
Page
445
447
460
452
PUBLIC ,DEBT
. .-
Public debt outstanding
Table 23. Pubhc debt outstanding June 30, 1929, by issues.._.
. . . -453
Table ,24. Description of the public debt issues outstanding June 30, 1929.
456
Table 25. Principal of the pubhc debt outstanding at the end of each
fiscal year from 1853 to,1929;..
.
.
466
Tablev26. Preliminary statement of the public debt outstanding October
. 31,. 1.929, by issues (daily statement basis)
467
Table>,27.. Interest-bearing .debt outstanding June 30, 1929, classified
^ according to kind of security and callable period or payable date
468
Table 28. Registered interest-bearing bonds outstanding, number of reg- •
istered accounts,'June 30, 1929, amount of interest payable and number
of checks drawn during the fiscal year 1929, classified by issues
469
•
Transactions in the public debt during the fiscal year 1929
Table 29. Public debt retirements chargeable against ordinary receipts
during the .fiscal year 1929, and cumulative totals to June 30, 1928 and
1929
.
-.L —
.
Table 30. Summary of transactions in interest-bearing and noninterest. • bearing securities during the fiscal year 1929
^
.
Table 31. Summary of transactions in interest-bearing securities during
the fiscal year 1 9 2 9 . . . . . . . . .
..
Table 32. Transactions in noninterest-bearing securities, by issues, during
the fiscal year 1929
....
-----Table 33. Treasury bonds. Treasury notes, and certificates of indebtedness
issued through each Federal reserve bank and the Treasury Department
• during the fiscal year 1 9 2 9 . . : . . . .
470
473
476
478
481
Transactions in public debt securities from date of inception
Table 34. Transactions in interest-bearing securities outstanding, by
issues, June 30, 1929, from date of inception, showing reconciliation of
account of the Treasurer of the United States with security account..:
483
Table 35. Transactions in third Liberty loan bonds from date of inception "
to June 30, 1929
486
Transactions in the public debt by years
Table 36. Transactions in the pubhc debt for the fiscal years 1917 to 1929.
Table 37. Net increases ( + ) and net decreases (—) in the public debt, by
issues, for the fiscal years 1918 to 1929 (warrant basis)
..
487
489
CONTENTS
XIIl
Page
Table 38. Public debt retirements, by issues, for the fiscal years 1918 to . ' .
1929 (revised daily statement basis)
._._._.
'.•' . 495
Table 39. Reconciliation of public debt issues and retirements. with (1)
public debt retirements, by sources, (2) balance in the general fund, and^
(3) outstanding public debt, for the fiscal years 1918 to 1929 (revised • '
daily statement basis)
.498 .
Table 40. Sources of debt increase and decrease for the fiscal years 1916
to 1929 (daily statement basis)
.
500
Interest on the public debt
. .•
Table 41. Interest on the public debt payable, paid, and outstanding unr
paid for the fiscal year 1929
.
..
Table 42. Interest paid on the public debt, by issues, for the fiscal years1918 to 1&29 (warrant basis)
_...:_...........
Table 43. Trend of rates of interest payable on outstanding public debt.Ji
.
.
•
. . .
..
•
•
.
"
'
.
.
,'.
502
.' U'V
.503
5Q9>"
'
I )
CONDITION OF THE TREASURY EXCLUSIVE OP PUBLIC DEBT LIABILITIES' ... *
Table 44. Current assets and liabilities of the Treasury at the close of the
^
fiscal years, 1927, 1928, and 1929 (revised daily statement b a s i s ) . . . . . ! . ^ .-Sil'
Table 45. Net balance in the general fund at the end of each month* from
October, 1915, to September, 1929 (daily statement basis)
^1. • 512
Table 46. Securities owned by the United States Government, June 30,
1929
.
:..
..
Al
514
TRANSACTIONS WITH RAILROADS
-'
•-.' .v--^ y-//.
Table 47. Payments to carriers from July 1, 1928, to June 30, 1929, pro-, vided for in section 204 of the transportation act, 1920, as amended,
for reimbursement of deficits on account of Federal control
---_
., . 516
Table 48. Obligations of carriers acquired pursuant to section 207 of the >
transportation act, 1920, as amended
517
Table 49. Payments to carriers from July 1, 1928, to June 30, 1929, under
the guaranty provided for in section 209 of the transportation act, 1920,
as amended, and payments by carriers to the United States under the
same section
^
517
Table 50. Loans to carriers under section 210 of the transportation act,
1920, as amended, and repayments on such loans from July 1, 1928, to
June 30, 1929, with loans outstanding June 30, 1928, and June 30, 1929.
518
STOCK AND CIRCULATION OF MONEY IN THE UNITED STATES
Table 51. Stock of money, money in the Treasury, in the Federal reserve
banks, and in circulation at the end of each fiscal year from 1913 to 1929.
Table 62. Stock of money, classified by kind, at the end of each fiscal year
from 1913 to 1929--.-^
Table 53. Money in circulation, classified by kind, at the end of each
fiscal year from 1913 to 1929
.
.....
_.
Table 54. Money in circulation, classified by kind, June 30, 1929
519
520
521
522
PERSONNEL
Table 55. Comparison of the number of employees in the departmental
and field services of the Treasury on June 30, 1928, and Augtist 31, 1929:
524
XIV
CONTENTS
Page
Table 56. Number of persons retired or now retained in the departmental and field services Of the Treasury under the civil service retirement act
.
Table 57. Number of employees in the departmental service of the
Treasury in Washington, by months, from June 30, 1928, to August 31,
1929..-..
.
'MISCELLANEOUS
^
524
625
-
Table 68. Principal of the funded and unfunded indebtedness of foreign
governments to the United States, the accrued and unpaid interest
thereon, and payments on accoimt of principal and interest, as of
November 15, 1929
.
....
_.
Table 69. Money cost of the World War to the United States Government to June 30, 1929
..:
.
...i...
Table 60. Insular and District of Columbia loans outstanding, and changes
during the fiscal year 1929...
.
..
Table 61. Estimated amount of wholly tax-exempt bonds outstanding, by
years, from June 30, 1913 to 1927, and, by months, from January, 1928,
tp August, 1929, classified by type of obligor
:.
Table 62. PartiaUy tax-exempt United States securities outstanding, by
years, from June 30, 1917 to 1927, and by months, from January, 1928,
to September, 1929
.
.....
.
526
527
531
633
534
APPENDICES TO REPORT ON THE FINANCES
REPORT OF THE
TREASURER:
Receipts and expenditures for fiscal years 1928 and 1929
.
Pay warrant transactions
.
Foreign exchange purchased
Collection items
District of Columbia securities
Checking accounts
Panama Canal
.
Payment of coupons from United States securities
Payment of interest on the registered securities of the United States.
Transactions on account of the Post Office Department
.
District of Columbia teachers' retirement fund
Transactions in the public debt
-,
i
Statement of the public debt of the United States, June 30, 1929..._
Public debt retirements chargeable against ordinary receipts
Statement of the Treasury of the United States
The general fund...'
.
.
Net available cash balance
The gold reserve fund
Gold fund. Federal Reserve Board
Gold in the Treasury
'
Securities held in trust
Postal savings bonds and investments therein
Withdrawal of bonds to secure circulation
Special trust funds
Depositaries of the United States
.
Public moneys in depositary banks
Interest on public moneys held by depositary banks
537
637
538
639
539
539
640
540
540
540
541
642
543
547
548
548
549
549
550
560
551
552
552
553
554
656
555
CONTENTS
R E P O R T OF T H E T R E A S U R E R — C o n t i n u e d .
•
XV
Page
Restoration of depositary balances
..
556
Coin and gold bar shipments or transfers
556
Recoinage of gold, silver, and minor coins.
557
Purchases of gold bullion a t t h e m i n t s and assay offices
558
Stock of metallic money in t h e United States
.
559
Redemption of Federal reserve a n d n a t i o n a l currency
559
Shipments of paper currency from Washington
560
Outstanding currency
560
Old d e m a n d notes
.
561
Fractional currency
.
.,
661
United States notes
562
Gold certificates
'
563
Silver certificates
1
564
Treasury notes of 1890
.
.
.
564
Issue of new small-size currency
666
United-States paper currency, b y denominations, held in reserve
566
United States paper currency prepared for issue a n d a m o u n t issued,
by fiscal years from 1920
.
567
United States paper currency issued, b y m o n t h s , during t h e fiscal
years 1928 a n d 1929
.
'
567
United States paper currency redeeined, b y m o n t h s , during t h e
fiscal years, 1928 and 1929
..
568
United States paper currency issued, redeemed, a n d o u t s t a n d i n g for
t h e fiscal year 1929
568
United States paper currency outstanding, b y m o n t h s , during t h e
fiscal years 1928 a n d 1929
.
568
Ratio of small denominations t o all p a p e r currency o u t s t a n d i n g
569
P a p e r currency, by denominations, o u t s t a n d i n g J u n e 30, 1928 a n d
1929
...
:
569
Legal tender qualities of United States currency
:
672
General account of t h e Treasurer of t h e United States
.
573
Tables from t h e report of t h e Treasurer—
No. 1. General distribution of t h e assets a n d liabilities of t h e
Treasury, J u n e 30, 1929.
...
...
675
No. 2. Available assets a n d liabilities of t h e T r e a s u r y a t t h e
close of June, 1928 a n d 1929
-__.
576
No. 3. Distribution of t h e General Treasury balance, J u n e 30, •
1929
.
577
No. 4. Assets of t h e Treasury other t h a n gold, silver, notes, a n d
certificates a t t h e end of each m o n t h , from July, 1926
577
No. 5. Assets of t h e Treasury a t t h e end of each moiith, from
July, 1926
.
.
578
No. 6. Liabilities of t h e T r e a s u r y a t t h e end of each m o n t h ,
from July, 1926
579
No. 7. United States notes of each denomination issued, redeemed, a n d outstanding a t t h e close of t h e fiscal years 1926,
1927, 1928, a n d 1929
580
No. 8. Gold certificates of each denomination issued, redeemed,
a n d outstanding a t t h e close of t h e fiscal years 1926, 1927, 1928,
and 1929..^
....
581
No. 9. Silver certificates of each denomination issued, redeemed,
and o u t s t a n d i n g a t t h e close of t h e fiscal years 1926, 1927,
1928, and 1929
582
XVI
CONTENTS
REPORT OF THE TREASURER—Continued.
Tables from, the report of the. Treasurer—Continued.
No. 10. Treasury notes of 1890 of each denomination issued,
redeemed,- and. outstanding at the close of the fiscal years
1926, 1927, 1928, and 1929
No. 11. Amount of United States notes, gold and silver certificates, and Treasury notes of each denomination issued,
redeemed, and outstanding at the close of the fiscal years
1926, 1927,1928, and 1929
No. 12. Federal reserve banks and branches, general, limited,
insular, special, and foreign banks designated as Government
depositaries of public moneys, with the balances held June
.- 30, 1929..^
.
. No. 13. Old demand notes of each denomination issued, redeemed, and outstanding June 30, 1929
='
No. 14. Fractional currency of each denomination issued, redeemed, and outstanding June 30, 1929
• No. 15. Compound-interest, notes.of each denomination issued,
redeemed, and outstanding June 30, .1929
.
No. 16. One and two ..year notes of each denomination issued,
' -'
redeemed, and outstanding June 30, 1929
.--.
••'• No. 17. Seven-thirty notes issued, redeemed, and outstanding
June 30, 1929
• No. 18. Refunding certificates, act of February 26, 1879, issued,
redeemed, and outstanding June 30, 1929
No. 19. Public debt obligations retired during the fiscal year
• .1929
.
-.
-No. 20. Number of banks with semiannual dut}^ levied, by fiscal
years, and number of depositaries with bonds as security at
close of each fiscal year from 1920
No. 21. Principal of obligations of the insular governments paid
during the fiscal year 1929
.
.
,
No. 22. Coupons from obligations of the insular governments
paid during the fiscal year 1929, classified by loans
No. 23. Checks issued and paid by the Treasurer for interest on
registered bonds of the insular governments during the fiscal
year 1929
• - N o . 24. Coupons from United States obligations paid during the
fiscal year 1929, classified by loans
No. 26. Checks issued by the Secretary and paid by the Treasurer
for interest on registered obligations of the United States during the fiscal year 1929
No. 26. Money deposited in the Treasury each month of the
fiscal year 1929 for the redemption of national-bank notes
No. 27. Amount of currency counted into the cash of the National Bank Redemption Agency and redeemed notes delivered,
by fiscal years from 1920 to 1928, and by months during the
fiscal year 1929
.
. No. 28. Currency received for redemption by the National Bank
/Redemption, Agency from the principal cities and other places,
by fiscal years, from 1920, in thousands of dollars
^
No. 29. Mode of payment for currency redeemed at the National
' Bank Redemption Agency, by fiscal years, from 1920
Page
583
584
685
587
587
588
588
588
588
589
594
594
594
595
696
597
597
598
599
599
CONTENTS
XVII
R E P O R T OF T H E T R E A S U R E R — C o n t i n u e d .
Tables from the report of t h e Treasurer—Continued.
.
No. 30. Deposits, redemptions, assessments for expenses, a n d
transfers and r e p a y m e n t s on account of t h e 5 per cent r e d e m p tion fund of national a n d Federal reserve b a n k s , b y fiscal years,
from 1920
.
No. 31. Deposits a n d redemptions on account of t h e r e t i r e m e n t
of circulation, b y fiscal.years, from 1920
'•--.
No. 32. Expenses incurred in t h e redemption of national and
Federal reserve currency, b y fiscal years, from 1920
,
No. 33.' A m o u n t of national-bank notes redeemed and assorted
during t h e fiscal year 1929, a n d t h e assessment.for expenses of
redemption
---->.
No. 34. A m o u n t . a n d n u m b e r of pieces of Federal reserve notes
and Federal reserve bank notes redeemed during t h e fiscal year
1929, a n d t h e assessment for expenses of redemption
.._. ,
No. 35. General cash account of t h e National Bank R e d e m p t i o n
Agency for t h e fiscal year 1929, a n d from July..!, 1874
No. 36. N u m b e r of notes of each kind of currency and_denomination redeemed and delivered by t h e National Bank R e d e m p t i o n '
Agency during the fiscal year 19.29.-.
No. 37. Average amount.of national-bank notes outstanding and
t h e redemptions, by fiscal years, from 1875 (the first year of t h e
agency)
No. 38. Federal reserve notes, canceled a n d uncanceled, forwarded by Federal reserve banks and branches, counted and
delivered, t o t h e Comptroller of t h e Currency for credit of
Federal reserve agents, by fiscal years, from 1916
No. 39. A m o u n t of money outside of t h e Treasury, t h e a m o u n t
held by Federal reserve b a n k s and agents, and t h e a m o u n t in
circulation, the per capita, a n d the estimated population of the
United States, on t h e last day of each m o n t h from July, 1927,
revised-.No. 40. Total a m o u n t expended on account of t h e P a n a m a
Canal, on basis of w a r r a n t s drawn, the receipts covered into the
Treasury, and the proceeds of sales of bonds to t h e close of t h e
fiscal year 1929
-
Page
599
600
600
601
601
602
603
605
605
606
606
R E P O R T OF T H E D I R E C T O R OF T H E M I N T ( A B R I D G E D ) :
Institutions of t h e m i n t service
Coinage
•_
.
Gold operations
.
._L
Silver operations
.
. . Refineries
Additions and improvements
--_
Edison medal
Stock of coin and m o n e t a r y bullion in the United States
'. Production of gold and silver
Industrial consumption of gold and silver
.
I m p o r t and export of domestic gold coin
i
. Appropriations, expenses, and income
:
.-__
Deposits of gold and silver, income, expenses, and employees, by institutions,' fiscal year 1929--_
._
71799—30—FI 1929
2
607
607
609
609
609
609
610
611
611
611
611
612
612
XVIII
CONTENTS
REPORT OF THE DIRECTOR OF THE MINT—Continued.
Issue of fine gold bars for gold coin and gold bullion
..
Receipts and disbursements of gold bullion and balances on hand
Purchase of minor coinage metal for use in domestic coinage
:i-Minor-coin distribution costs
Minor coins outstanding
.
Operations of the assay departments
..
Proof bullion
.
.
.
Operations of the melting and refining and of the coining' departments, fiscal year 1929
.
Refining operations
.
.
_.i
Ingot melts made
.
--.
.
Fineness of melts for. gold and silver ingots
..
Commercial and certificate bars manufactured
:
Bullion gains and losses
'.--Wastage of coinage metal, and loss on sale of sweeps
Engraving department
.
.
Medals s o l d . . .
....
Employees...
.
:
:
Work of the minor assay offices
Gold receipts at Seattle
.
Laboratory, Bureau of the Mint
Assay commission's annual test of coin
Tables from the report of the Director of the Mint—
Deposits and purchases of gold during the fiscal year ended June
30, 1929
--Deposits and purchases of silver during the fiscal year ended June
30, 1929
.......
.
.
.
...
Deposits bf gold at United States mints and assay offices since
1873
'
,-..1-.Deposits of silver at the United States mints and assay offices
since 1873
Authority for United States coinage, by denominations, with
standard weight and fineness, and total coined
Coinage of each mint, by value, with grand total pieces, since
organization to close of business December 31, 1928
Coinage of each mint during the past 10 calendar years
Combined gold coinage of the mints of the United States, by denominations and calendar years, since their organization
Combined silver coinage of the mints of the United States, by denominations and calendar years, since their organization.
Combined minor coinage of the mints of the United States^ by denominations and calendar years, since their organization
Total gold, silver, and minor coinage of the United States, by
calendar years
Stock of domestic coin in the United States, June 30, 1929.
Bullion in mints and assay offices, June 30, 1929
.
Basic metallic stock, June 30, 1924 to 1929
.
...
Location, ownership, and per capita circulation of United States
money, June 30, 1929
...
Estimated monetary stocli of gold and silver in the United States
and the amount per capita at the close of each fiscal year since
1873
.
Page
613
613
614
614
615
615
616
616
618
619
619
620
622
622
623
623
624
624
625
625
627
630
632
634
635
636
639
640
644
646
648
650
652
662
662
653
654
CONTENTS
XIX
REPORT OF THE DIRECTOR OF THE MINT—Continued.
Tables from the Report of the Director of the Mint—Continued.
Stock of money in the United States, December 31, 1928
Location, ownership, and per capita circulation of United States
money, December 31, 1928
....
Monetary stock of gold in the United States since 1873
.—
Average price of an ounce of gold in London and United States
equivalent" since 1870
Average commercial ratio of silver to gold each calendar year
since 1687, with gold considered as of legal monetary value._Ratio of silver to gold, as affected by World War
...
Bullion value of the silver dollar at the annual average price of
silver each calendar year since 1837
.
Values of foreign coins, October 1, 1929
..
Monetary stock of principal countries of the world, end of
calendar year 1927
.•
Monetary stock of principal countries of the world, end of
calendar year 1928
World production df gold and silver, 1927 and 1 9 2 8 . - - . . . . . ^ . Production of gold and silver in the world since 1860.
.
Production of gold and silver in the world since the discovery of
America
Page
655
656
657
668
659
659
660
660
663
668
672
675
676
REPORT OF THE COMPTROLLER OF THE CURRENCY (ABRIDGED) :
Legislation recommended—
Amendments to^ the national bank act
.
679
Amendments to the laws of the District of Columbia
688
Branches...
.
'. ._ 689
Organization and liquidation of national banks
. . . 693
National banks in the trust field 1
_.l
:
694
National bank failures
700
Bank failures other than national
.
._
706
National bank circulation
'
706
Redemption of national and Federal reserve bank circulation..
708
National^banks of issue
.
. . . 708
Condition of national banks at date of each report called for during
the year
709
National bank liabilities on account of bills payable and rediscounts. . 712
Loans and discounts of national.banks
713
Comparative statement of loans and discounts, including rediscounts,
made by national banks during the last three fiscal years
718
Comparative changes in demand and time deposits, loans and discounts. United States Government and other bonds and securities,
and the amount of reserve of national banks with Federal reserve
banks since June 30, 1925
718
United States Government securities held by national banks in reserve
cities and States
719
Investments of national banks
721
Per capita individual and savings deposits in aU reporting banks
726
Earnings, expenses, and dividends of national banks
734
National banks classified according to capital stock
747
National bank examiners
.
748
Convictions of national bank officers and others for violations of the
national banking laws during the year ended October 31, 1929
753
XX
CONTENTS
R E P O R T O F T H E C O M P T R O L L E R OF T H E C U R R E N C Y — C o n t i n u e d .
Federal reserve b a n k s
Federal reserve bank discount r a t e s . . .
Discount rates prevailing in Federal reserve b a n k a n d branch
cities
R a t e s for money in New York
New York clearing house
Clearing-house associations in t h e 12 Federal reserve b a n k cities a n d
elsewhere
Banks other t h a n national
'
S t a t e (commercial) b a n k s
Loan a n d t r u s t companies
i
Stock savings b a n k s
°
M u t u a l savings b a n k s
Depositors a n d deposits in m u t u a l a n d stock savings banks
Private b a n k s - - - - '
.
-Resources a n d liabilities of. .all ,reporting b a n k s other t h a n
national
National b a n k s - - ^.1
-..All reporting b a n k s in t h e United States a n d possessions
Individual deposits in all reporting b a n k s
.
Resources a n d liabilities of all reporting b a n k s
..
Money in t h e United States
.
.._.,.
Banks in t h e District of Columbia
•-.
^
Earnings, expenses, a n d dividends of b a n k s other t h a n national
in t h e District of Columbia
--Building a n d loan associations in t h e District of Columbia
.
Building and loan associations in t h e United States
.
M o n e t a r y stock of principal countries of t h e world
.
Federal land b a n k s
.-,.J o i n t stock land b a n k s
Federal intermediate credit b a n k s
'.
National agricultural credit c o r p o r a t i o n s . .
^_-.
United States Postal Savings S y s t e m . . .
School savings banking
Savings b a n k s in principal countries of t h e world
,-.
Resources of leading foreign b a n k s of issue
.
:.
Expenses of t h e . C u r r e n c y Bureau
.
Page
758
760
760
763
765
765
765
768
770
772"
774
776
779'
781
785
787
798
799
. 800:
803
803
804
805
807
807
808
810
811
. 811
816
817
820
821
R E P O R T OF THE COMMISSIONER OF INTERNAL R E V E N U E ( A B R I D G E D ) :
Collections
:...
Cost of administration
;
.
_"
Income t a x u n i t .
^
E x a m i n a t i o n of r e t u r n s
Analysis of production
^
'
Additional, re venue
..
Claims a n d overassessments
.
Relation of personnel in n u m b e r a n d cost of p r o d u c t
T h e pending job
1
.
T a x 3^ears 1917 t o 1926, inclusive
C u r r e n t years
Audit in Washington
...
Reduction in n u m b e r of 60-day letters mailed as related t o
appeals
filed
•_.
i
...
T h e a u d i t in t h e
field
'
823
825
825
825
826
826
827
827
828
828
829
829
831
832
CONTENTS
XXI
R E P O R T OF T H E C O M M I S S I O N E R OF I N T E R N A L R E V E N U E — C o n t i n u e d . .
Income Tax Unit—Continued.
_
Page
Policy and procedure changes effected
833
Present organization
.
836
Audit review division
836
Field procedure division
838
Field divisions838
Clearing division-•839
Records division
842
Rules a n d regulations section
843
Service section-_,
844
Personnel
.
844
• Surplus property
845
Economies effected
845
Special Advisory Committee
849
Miscellaneous T a x Unit
^
. 851
Personnel a n d p a y roll
851
Taxes collected
851
Appeals a n d review section
851
E s t a t e t a x division
.
852
Miscellaneous division
^
.
854
Tobacco division
857
Accounts a n d Collections Unit
859
Collection accounting division
869
Collectors' personnel, equipment, a n d space division
862
Disbursement accounting division
863
Office of t h e General Counsel
863
Appeals division
863
I n t e r p r e t a t i v e division
...
.
867
Penal division
868
Civil division
^
I
871
Review division
874
Administrative division
878
Bureau a n d field personnel
878
Tables from t h e report of t h e Commissioner of I n t e r n a l R e v e n u e —
S u m m a r y of m o n t h l y internal revenue receipts for years ended
J u n e 30, 1928 a n d 1929, by sources
.
880
Sunimary of internal revenue receipts, years ended J u n e 30, 1928
and 1929, by sources
.
892
S u m m a r y of internal revenue receipts, years ended J u n e 30, 1928
and 1929, by collection districts
893
S u m m a r y of internal revenue receipts, year ended J u n e 30, 1929,
by States
894
S u m m a r y of income t a x receipts from corporations a n d individuals, year ended J u n e 30, 1929, by States
895
S u m m a r y of receipts from income t a x , years ended J u n e 30, 1927,
1928, a n d 1929, b y States, with per cent of increase or decrease
in 1929 compared with 1928
....
896
T o t a l internal revenue receipts, years ended J u n e 30, 1863-1929.
897
I n t e r n a l revenue t a x on p r o d u c t s from Philippine Islands, years
ended J u n e 30, 1928 a n d 1929, by articles taxed
897
I n t e r n a l revenue t a x on p r o d u c t s from P o r t o Rico, years ended
J u n e 30, 1928 a n d 1929, by articles taxed
897
INDEX-.-.
.
.
.
899
SECRETARIES OF THE TREASURY AND PRESIDENTS UNDER
WHOM THEY SERVED
NOTE.—Robert Morris, the first financial oflQcer of the Government, was Superintendent of Finance
from 1781 to 1784. Upon the resignation of Morris, the powers conferred upon him were transferred to the
"Board of the Treasury." Those who finally accepted positions on this board were John Lewis Gervais,
Samuel Osgood, and Walter Livingston. The board served until Hamilton assumed office in 1789.
Term of service
Secretaries of Treasury
From—
Sept.
Feb.
Jan.
May
Feb.
Oct.
Oct.
Mar.
Mar.
Aug.
May
Sept.
July
Mar.
Sept.
Mar.
July
Mar.
Mar.
July
Mar.
Mar.
Dec.
Jan.
Mar.
il, 1789
3,1795
1,1801
14,1801
9,1814
6,1814
22,1816
7,1825
6,1829
8,1831
29,1833
23,1833
1,1834
6,1841
13,1841
8,1843
4,1844
8,1845
8,1849
23,1850
7,1853
7,1857
12,1860
16,1861
7,1861
Presidents
To—
Jan.
Dec.
May
Feb
Oct.
Oct.
Mar.
Mar.
June
May
Sept.
June
Mar.
Sept.
Mar.
May
Mar.
Mar.
July
Mar.
Mar.
Dec.
Jan.
Mar.
June
31,1795
31,1800
13,1801
9,1814
5,1814
21,1816
6,1825
5,1829
20,1831
28,1833
22,1833
25,1834
3,1841
11,1841
, 1,1843
2,1844
7,1845
5,1849
22,1850
6,1853
6,1857
8,1860
14,1861
6,1861
30,1864
Alexander Hamilton, New York
Oliver Wolcott, Connecticut
Samuel Dexter, Massachusetts
Albert Gallatin, Pennsylvania i . . . . .
.George W. Campbell, Tennessee
Alexander J. Dallas, Pennsylvania. .
Wm. H. Crawford, Georgia
Richard Rush, Pennsylvania 2
Samuel D. Ingham, Pennsylvania 3..
Louis McLane, Delaware
Wm. J. Duane, Pennsylvania
Roger B. Taney, Maryland *
Levi Woodbury, New Hampshire 8Thomas Ewing, Ohio «
Walter Forward, Pennsylvania ^
John C. Spencer,* New York s
Geo. M. Bibb, Kentucky
Robt. J.'Walker, Mississippi ^
•Wm. M. Meredith, Pennsylvania.-.
Thos. Corwin, Ohio
.-...
James Guthrie, Kentucky
Howell Cobb, Georgia »"
Philip F. Thomas, Maryland
John A. Dix, New York
Salmon P. Chase, Ohio "
Washington.
Washington, Adams.
Adams, Jefferson.
Jefferson, Madison.
Madison.
Madison.
Madison, Monroe.
Adams, J. Q.
Jackson.
Jackson.
Jackson.
Jackson.
Jackson, Van Buren.
Harrison, Tyler.
Tyler.
Tyler.
Tyler, Polk.
Polk.
Taylor, Fillmore.
Fillmore.
Pierce.
Buchanan.
Buchanan.
Buchanan.
Lincoln.
1 While holding the office of Secretary of the Treasury, Gallatin was commissioned envoy extraordinary
and minister plenipotentiary Apr. 17, 1813, with John Quincy Adams and James A. Bayard, to negotiate
peace with Great Britain. On Feb. 9, 1814, his seat as Secretary of the Treasury was declared vacant
because of his absence in Europe. William Jones, of Pennsylvania (Secretary of the Navy), acted ad
interim Secretary of the Treasury from Apr. 21, 1813, to Feb. 9, 1814.
« Rush was nominated Mar. 5, 1825, confirmed and commissioned Mar. 7, 1825, but did not enter upon
the discharge of his duties until Aug. 1,1825. Samuel L. Southard, of New Jersey (Secretary of the Navy),
served as ad interim Secretary of the Treasury from Mar. 7 to July 31, 1825.
> Asbury Dickens (chief clerk), ad interim Secretary of the Treasury from June 21 to Aug. 7,1831.
< McClintock Young (chief clerk), ad interim Secretary of the Treasury from June 25 to 30,1834.
* McClintock Young (chief clerk), ad interim Secretary of the Treasury from Mar. 4 to 5, 1841.
« McClintock Young (chief clerk), ad interim Secretary of the Treasury Sept. 12, 1841.
7 McClintock Young (chief clerk), ad interim Secretary of the Treasury from Mar. 1 to 7,1843
8 Spencer resigned as Secretary of the Treasury May 2,1844; McClintock Young (chief clerk), ad interim
Secretary of the Treasury from May 2 to July 3,1844.
' McClintock Young (chief clerk), ad interim Secretary of the Treasury from Mar. 6 to 7, 1849.
10 Isaac Toucy, of Connecticut (Secretary of the Navy), acted as Secretary of the Treasury ad interim
from Dec. 10 to 12,1860.
" George Harrington, District of Columbia (Assistant Secretary), ad interim Secretary of the Treasury
from July 1 to 4, 1864.
XXIII
XXIV
SECRETARIES OF THE TREASURY
Secretaries of the Treasury and Presidents under whom they served—Continued
Term of service
Secretaries of Treasury
FromJuly
Mar.
Mar.
Mar.
June
July
Mar;
Mar.
Nov.
Sept.
Oct.
Mar.
Apr.
Mar.
Feb.
Mar.
Mar.
Feb.
Mar.
Mar.
Mar.
Dec.
Feb.
Mar.
5.1864
9.1865
12,1869
17,1873
4,1874
7,1876
10,1877
8,1881
14,1881
25,1884
31,1884
8,1885
1,1887
7,1889
25,1891
7,1893
6,1897
1,1902
4,1907
8,1909
6,1913
16,1918
2.1920
4.1921
Presidents
To—
Mar.
Mar.
Mar.
June
June
Mar.
Mar.
Nov.
Sept.
Oct.
Mar.
Mar.
Mar.
Jan.
Mar.
Mar.
Jan.
Mar.
Mar.
Mar.
Dec.
Feb.
Mar.
3,1865
3,1869
16,1873
3,1874
20,1876
9,1877
3,1881
13,1881
4,1884
30,1884
7,1885
31,1887
6,1889
29,1891
6,1893
5,1897
31,1902
3,1907
7,1909
5,1913
15,1918
1.1920
3.1921
Wm. P. Fessenden, Maine 12
Hugh McCulloch, Indiana " "
Geo. S. Boutwell, Massachusetts
Wm. A. Richardson, Massachusetts.
Benj. H.' Bristow, Kentucky »
Lot M. Morrill, Maine
John Sherman, Ohio i^.
Wm. Windom, Minnesota i^.l.'.l...'.
Chas. J. Folger, New York is
_..
Walter Q. Gresham, Indiana.
Hugh McCulloch, Indiana 1*
Daniel Manning, New Yorki..
Chas S. Fairchild, New Y o r k . . . . . . .
Wm,. Windom, Minnesota 1^ is...
Chas. Foster, Ohio..
John G. Carlisle, .Kentucky
Lyman J. Gage, Illinois
L. M. Shaw, I o w a . . . . . .
George B. Cortelyou, New York
Franklin MacVeagh, Illinois
W. G. McAdoo, New York
Carter Glass, Virginia
David F, Houston, Missouri
Andrew W. Mellon, Pennsylvania...
Lincoln.
Lincoln, Johnson.
Grant.
Grant.
Grant.
Grant, Hayes.
Hayes.
Garfield, ArthurV
Arthur.
Arthur.
Arthur, Cleveland.
Cleveland.
Cleveland, Harrison.
Harrison.
Harrison, Cleveland.
Cleveland, McKinley.
McKinley, Roosevelt.
Roosevelt.
Roosevelt.
, >
Taft.
Wilson.
Wilson.
Wilson.,
Harding, C;ooJidge,
Hoover.
" George Harrington (Assistant Secretary), ad interim Secretary of the Treasury from Mar. 4 to 8, 1865.
" J o h n F. Hartley, of Maine (Assistant Secretary), ad interim Secretary of the Treasury from Mar. 5
to 11,1869.
.
'
" Hugh McCulloch was Secretary from Mar. 9,1865, to Mar. 3,1869, and also from Oct. 31,1884, to Mar.
7,1885.
• •'
.
» Charles F . Conant, of New Hampshire (Assistant Secretary), ad interim Secretary of the.Treasury
from June 21 to 30 (July 6), 1876.
19 Henry F . French, of Massachusetts (Assistant Secretary), ad interim Secretary of the Treasury from
Mar.4to7, 1881.
" William Windom was Secretary from Mar. 8,1881, to Nov. 13,1881, and also from Mar.-;7,1889, to Jani
29,1891.
,
!
.
V
18 Charles E. Coon, of New York (Assistant Secretary), ad interim Secretary of the Treasury from Sept.
4 to 7,1884; Henry F. French, of Massachusetts (Assistant Secretary), ad interim Sept. 8 to 14,1884; Charles ,
E. Coon ad interim Sept. 15 to 21, 1884.
" A'. B. Nettleton, of Minnesota (Assistant Secretary), ad interim Secretary of the Treasury from Jan<
30 to Feb. 24, 1891.
•
. .
.
UNDERSECRETARIES OF THE TREASURY AND PRESIDENTS
AND SECRETARIES UNDER WHOM THEY SERVED. .
Term of service
Undersecretaries 1
From—
To-^
July 1,1921
Nov. 20,1923
Mar. 4,1927
Nov. 17,1923
Jan. 31,1927
S. Parker Gilbert, jr:. New Jersey
Garrard B. Winston, Illinois
Ogden L. Mills, New York.
1 Office established act June 16,1921.
• Secretaries
' Presidents :
Mellon. J . : . . Harding, Coolidge.
Mellon
• Coolidge.
Mellon
Coolidge, Hoover.
ASSISTANT SECRETARIES OF THE TREASURY.
XXV
ASSISTANT SECRETARIES OF THE TREASURY AND PRESIDENTS AND SECRETARIES UNDER WHOM THEY SERVED
•
Term of service
Assistant Secretaries i
From—
Mar.
Oct.
Nov.
Mar.
12,1849
10,1849
16,1850
14,1853
Mar. 13,1857
Secretaries
Presidents
Meredith . .
Meredith, Corwin.
Corwin, Guthrie..
Guthrie, C o b b . . . .
Taylor.
Taylor, Fillmore.
Fillmore, Pierce.
Pierce, Buchanan.
To—
Oct.
Nov.
Mar.
Mar.
9,1849
15,1850
13,1853
12,1857
Charles B. Penrose, Pennsylvania.
Allen A. Hall, Pennsylvania
William L. Hodge, Tennessee
Peter G. Washington, District of
Columbia.
Jan. 16,1861 Philip Claj^on, Georgia
Cobb, T h o m a s ,
Dix.
Mar. 13,1861 July; 11,1865 George Harrington, District of Chase, Fessenden,
McCulloch.
Columbia.2
Mar. 18,1864 June 15,1865 Maunsell B. Field, New York.... Chase.' Fessenden,
McCulloch.
Jan. 6,1865 Nov. 30,1867 William E. - Chandler, New Fessenden, McCulloch.
Hampshire.
McCulloch, BoutJuly 11,1865 May 4,1875. John F. Hartley, Maine
well, Richardson, Bristow.
McCulloch
Dec. 2,1867 May 31,1868 Edmund Cooper, Tennessee
Mar. 20,1869- Mar. 17,1873 William A. Richardson, Massa- Boutwell
..chusetts. .
Mar. 8,1873 June 11,1874 Frederick A. Sawyer, South Caro- Richardson, Bristow.
lina.
July 1,1874 Apr. 3,1877 Charles F. Conant, New Hamp- Bristow, Morrill,
Sherman.
shire.
Bristow
Mar. 4,1875 June 30,1876 Curtis F . Burnam, Kentucky
Henry F. French, Massachusetts'. Morrill, Sherman,
Aug. 12,1876 Mar. 9,1885
Windom, Folger, Gresham,
McCulloch,
Manning.
Apr. 3,1877 Dec. 8,1877 Richard C. McCormick, Arizona. Sherman .
Sherman
Dec. 9,1877 Mar. 31,1880 John B. Hawley, Illinois
Apr. 10,1880 Dec. 31,1881 J. Kendrick Upton, New Hamp- S h e r m a n , Windom, Folger.
shire.
Folger
Feb. 28,1882 Apr. 16,1884 John C. New, Indiana.
Folger, Gresham,.
Apr. 17,1884 Nov. 10,1885 Charles E. Coon, New York
McCulloch,
Manning.
Mar. 14,1885 Apr. 1,1887 Charles S. Fairchild, New-York.. Manning
Nov. 10,1885 June 30,1886 William E. Smith, New York.... Manning
July 12,1886 Mar. 12,1889 Hugh S. Thompson, South Caro- Manning, Fairlina.
child, Windom.
Apr. 6,1887 Mar. 11,1889 Isaac N. Maynard, New Y o r k . . . Fairchild, Win. dom.
Windom
Apr. 1,1889 July 20,1890 George H. Tichner, Illinois...
Apr. 1,1889 Oct. 31,1890 George T. Batchelder, New York 3 Windom
July 22,1890 Dec. 1,1892 A. B. Nettleton, Minnesota...^... Windom, Foster. _
July 23,1890 June 30,1893 Oliver L. Spaulding, Michigan... Windom, Foster,
Carlisle.
Foster
... ..
Apr. 27,1891 Oct. 31,1892 Lorenzo Crounse, Nebraska
Foster
Nov: 22,1892 Mar. 3,1893 John H. Gear, Iowa
Dec. 23,1892 Apr. 3,1893 Genio M. Lambertson, Nebraska. Foster, Carlisle....
Buchanan.
Lincoln, Johnson.
Lincoln, Johnson.
Lincoln, Johnson. .
Johnson, Grant.
Johnson.
Grant.
Grant.
Grant, Hayes.
Grant.
Grant, Hayes,.
Garfield, Arthur,
Cleveland.
Hayes.
Hayes.
Hayes,
Garfield,
Arthur.
Arthur.
Arthur, Cleveland.
Cleveland.
Cleveland.
Cleveland,
son.
Cleveland,
son'.
Harrison.
Harrison.
Harrison.
Harrison,
land.
Harrison.
Harrison.
Harrison,
land.
HarriHarri-
Cleve-
Cleve-
1 Office established act Mar. 3, 1849;. appointed by the Secretary. Act Mar. 3, 1857, made the office
presidential.
> Act Mar. 14,1864, provides one additional Assistant Secretary.
8 Act July 11,1890, provides for an additional Assistant Secretary.
XXVI
ASSISTANT S E C R E T A R I E S OF THE TREASURY
Assistant Secretaries of the Treasury and Presidents and Secretaries under whom
they served—Continued
Term of service
9
From-
Assistant Secretaries
Secretaries
Apr. 12,1893
Apr.
7,1897
Apr. 13,1893
Mar. 31,1897
Charles S. Hamlin, Massachu- Carlisle, Gage
setts.
William E. Curtis, New York.... Carlisle, Gage
July
1,1893
May
Scott Wike, Illinois...
Apr.
Apr.
7,1897
7,1897
Mar. 10,1899
Mar. 4,1903
William B . Howell, New Jersey.. Gage
Oliver. L. Spaulding, Michigan... Gage, Shaw
June 1,1897
Mar. 13,1899
Mar. 6,1901
June 3,1906
Frank A. Vanderlip, Illinois
Horace A. Taylor, Wisconsin
Gage .
Gage, Shaw
Mar. 6,1901
Apr. 15,1903
Milton E. Ailes, Ohio .
Gage, Shaw.
Mar. 5,1903
May 27,1903
Mar. 6,1905
Mar. 5,1905
Jan. 21,1907
Nov. 1,1909
July
Jan.
Apr.
Mar.
Mar.
Feb.
Mar.
Apr.
16,1908
28,1907
6,1909
10,1909
Robert B. Armstrong, Iowa
Charles H. Keep, New York
James B. Reynolds, Massachusetts."
John H. Edwards, Ohio . . .
Arthur F . Statter, Oregon
Beekman Winthrop, New York..
Louis A. Coolidge, Massachusetts
Apr. 5,1909
Apr. 19,1909
Nov. 27,1909
June 8,1910
Apr. 3,1911
July ^31,1913
Charles D. Norton, Illinois
Charles D. Hilles, New Y o r k . . . .
James F . Curtis, Massachusetts..
June 8,1910
Apr. 4,1911
July 20,1912
July 3,1912
Mar. 3,1913
Sept. 30,1913
A. Piatt Andrew, Massachusetts.
Robert 0 . Bailey, Illinois
Sherman P . Allen, Vermont
Mar. 24,1913
Aug.' 1,1913
Feb. 2,1914
Aug. 9,1914
Oct.
Mar.
Aug.
Apr.
June
Oct.
Oct.
Jan.
Mar.
Aug.
Nov.
Aug.
1,1917
26,1917
15,1917
28,1918
20,1919
26,1921
John Skelton Williams, Virginia.
Charles S. Hamlin, Massachusetts.
Byron R. Newton, New York
William P . Malburn, Colorado-.
Andrew J. Peters, Massachusetts
Oscar T. Crosby, Virginia
Leo S. Rowe, Pennsylvania
James H. Moyle, Utah
Shaw.Shaw
Shaw, Cortelyou,
MacVeagh.
Shaw, Cortelyou..
Shaw
Cortelyou
Cortelyou, MacVeagh.
MacVeagh
MacVeagh
MacVeagh, McAdoo.
MacVeagh
MacVeagh
MacVeagh, McAdoo.
McAdoo
McAdoo
Oct. 30,1917
July
6,1920
Dec. 15,1917
Sept. 4,1918
Jan. 31,1919
June 30,1920
Mar.
Nov.
June
July
Dec.
Dec.
1,1906
22,1907
23,1907
17,1908
1,1913
24,1914
17,1914
17,1917
22,1917
5,1917
4,1897
6,1919 Nov. 15,1920
21,1919 June 14,1920
15,1920 Apr. 14,1921
6,1920 June 30,1921
4,1920
4,1920
Presidents
To-
May 31,1921
Mar. 4,1921
Carlisle, Gage
McAdoo
McAdoo
McAdoo
McAdoo
McAdoo, Glass...
McAdoo, Glass,
Houston, Mellon.
Russell C. Leffingwell,^ New McAdoo, Glass,
Houston.
York.
McAdoo, Glass.-.
Thomas B. Love, Texas
McAdoo, Glass,
Albert Rathbone, New York
Houston.
^
Glass, Houston. _Jouett Shouse, Kansas..
Glass, Houston._.
Norman H. Davis, Tennessee
Houston, Mellon..
Nicholas Kelley, New York
S. Parker Gilbert, jr., New Jer- Houston, Mellon..
Ewing Laporte, Missouri .
Angus W. McLean, North Carolina.
Cleveland,
McKinley.
Cleveland,
McKinley.
Cleveland,
McKinley.
McKinley.
McKinley, Roosevelt.
McKinley.
McKinley, Roosevelt.
McKinley, Roosevelt.
Roosevelt.
Roosevelt.
Roosevelt, Taft.
Roosevelt.
Roosevelt.
Roosevelt.
Roosevelt, Taft.
Taft.
•Taft. ,
Taft, Wilson.
Taft.
Taft.
Taft, Wilson.
Wilson.
Wilson.
Wilson.
Wilson.
Wilson.
Wilson.
Wilson.
Wilson, Harding
Wilson.
Wilson.
Wilson.
Wilson.
Wilson.
Wilson, Harding.
Wilson, Harding.
Houston, Mellon- Wilson, Harding.
Wilson.
Houston
* Act Oct. 6, 1917, provided for two additional Assistant Secretaries for duration of war and six months
after.
8 Became Undersecretary July 1,1921.
ASSISTANT S E C R E T A R I E S OF THE
TREASURY
XXVII
Assistant Secretaries of the Treasury and Presidents and Secretaries under whom
they served—Continued
•
Term of service
Assistant Secretaries
From—
Mar,
May
Dec.
Mar.
July
July
Apr.
Dec.
Aug.
Nov.
16,1921
4,1921
23,1921
3,1923
9,1923
1,1924
1,1925
28,1926
1,1927
7,1927
Secretaries
Presidents
ToMar.
July
July
July
Nov.
Nov.
July
June
31,1925
9,1923
26,1922
13,1926
19,1923
6,1927
31,1927
25,1929
Aug. 31,1929
June 26,1929
Eliot Wadsworth, Massachusetts.
Edward Clifford, Illinois
Elmer Dover, Washington..
McKenzie Moss, Kentucky
Garrard B. Winston, Illinois «....
Charles S. Dewey, Illinois._.....
Lincoln C. Andrews, New York..
CarlT. Schuneman, Minnesota..
Seymour Lowman, New York..".
Henry Herrick Bond, Massachusetts.
Ferry K. Heath, Michigan.
Mellon
Mellon..
Mellon... Mellon
MellonMellon
Mellon
Mellon....
Mellon
Mellon.."
Harding, Coolidge.
Harding.
Harding.
Harding, Coolidge.
Harding, Coolidge.
Coolidge.
Coolidge.
Coolidge, Hoover.
Coolidge, Hoover..
Coolidge, Hoover.
Mellon.-..
Hoover.
.
• Became Undersecretary Nov. 20,1923.
ASSISTANTS TO THE SECRETARY OF THE TREASURY ^ AND
PRESIDENTS AND SECRETARIES UNDER
WHOM THEY SERVED
Term of service
Assistants to the Secretary
From—
To—
Sept. 11,1789
Mar. 6,1917
May 8,1792
Mar. 4,1921
Secretaries '
Tench Coxe, Pennsylvania
Hamilton
George R. Cooksey, District of Columbia- McAdoo,. Glass,
Houston.
Presidents
Washington.
Wilson.
1 ^Office established Sept. 2,1789; abolished act May 8, 1792; reestablished act Mar. 3, 1917. Appointed
by'the Secretary.
^
XXVIIT
PRINCIPAL ADMINISTRATIVE AND STAFF OFFICERS
PRINCIPAL ADMINISTRATIVE AND STAFF OFFICERS OF THE
TREASURY DEPARTMENT AS OF NOVEMBER IS, 1929
OFFICE OF T H E SECRETARY
Andrew W. Mellon
Ogden L. Mills..
Ferry K. Heath
Seymour Lowman.
Vacant
John Kieley
-•
W. Norman Thompson
Charles R. Schoeneman...
H. R. Sheppard...
L. C. Martin
Francis C. Rose.
Frank A. Birgfeld
John F . Ebersole
Joseph S. McCoy
W. H. Moran
Edward F. Bartelt.
James E. Harper
Thomas L. Lawrence
L. C. Spangler
Robert Le Fevre
John L. Summers
Secretary ofthe Treasury.
Undersecretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant to the Secretary.
Assistant to the Undersecretary.
Assistant to the Undersecretary.
Assistant to Assistant Secretary.
Assistant to Assistant Secretary.
Assistant to Assistant Secretary.
Chief Clerk and Superintendent.
Chief, Section of Financial and Economic Research,
Government Actuary.
1. Chief, Secret Service Division.
Chief, Division of Bookkeeping and Warrants.
Chief, Division of Appointments.
Chief, Section of Surety Bonds.
Chief, Division of Supply.
Superintendent of Supplies, General Supply Committee,
Disbursing Clerk.
SPECIAL STAFF ASSISTANTS
Ellsworth C. Alvord
David E. Finley
Albert G. Redpath
._
Edward J. Cunningham
C. Y. Morris
,
Special Assistant to the Secretary.
Special Assistant to the Secretary.
Special Assistant to the Undersecretary.
Member ofthe War Loan Staff.
Member of the War Loan Staff.
CONSULTING ARCHITECTURAL SPECIALISTS
Edward H, Bennett, Chairman.
Louis Ayres.
Arthur Brown, jr.
William A. Delano.
•—
Clarence C. Zantzinger.
Louis A. Simon.
John Russell Pope.
PUBLIC D E B T SERVICE
William S. Broughton
S. R.Jacobs
Rene W. Barr
E. E. Jones
Frank A. DeGroot
Charles N . McGroarty
Melvin R. Loafman
Maurice A. Emerson
Commissioner of the Public Debt.
Assistant Commissioner of the Public Debt.
Deputy Commissioner of the Public Debt.
Register of the Treasury.
Assistant Register ofthe Treasury.
Chief, Division of Loans and Currency.
Chief, Division of Accounts and Audit.
.'.. Chief, Division of Paper Custody.
i
'
OFFICE OF T H E COMMISSIONER OF ACCOUNTS AND DEPOSITS
Robert G.Hand
Daniel W. Bell
Edward D. Batchelder
:
Commissioner of Accounts and Deposits.
Deputy Commissioner.
Chief, Division of Deposits.
OFFICE OF THE COMPTROLLER OF THE CURRENCY
J.W.Pole
F. G. Await
Eugene H. Gough
J . L . Proctor
Vacant
Robert D. Garrett
John G. Herndon
Comptroller of the Currency.
,
Deputy Comptroller.
Deputy Comptroller.
.; Deputy Comptroller.
Chief, National Bank Examiners.
Supervising Receiver, Insolvent National Bank Division.
Chief Clerk.
PRINCIPAL ADMINISTRATIVE AND STAFF OFFICERS
XXIX
OFFICE OF T H E TREASURER OF T H E U N I T E D STATES
Walter O. Woods
Oeorge O. Barnes
W.F.Warner
Treasurer of the United States.
Assistant Treasurer. .
Chief Clerk, v
.. . . . - ' ,
. . . . , " ;'.:•• ..)• :• . >
OFFICE OF THE. COMMISSIONER OF INTERNAL" R E V E N U E
Robert H. Lucas
Harris F. Mires
David Burnet
Oeorge J. Schoeneman
R. M. Estes
Pressly R. Baldridge
A. R. Marrs
L.C.Mitchell
Clarence M. Charest....
.':'._.:
Commissioner of Internal Revenue.
Assistant to the Commissioner.
Deputy Commissioner.
Deputy Commissioner.
Deputy Commissioner.
rSpecial Deputy Commissioner.
Assistant Commissioner.
Assistant Commissioner.
General Counsel.
.,
,; i-Vi : '
...
.•'•::'
.' ; • •;. •.::;;
:.-jv •.•. ,
,"•..:•
PROHIBITION SERVICE
James M. Doran
Harry J. Anslinger
B. R. Rhees
Levi G. Nutt
Commissioner of Prohibition. ,:.
Assistant Commissioner of Prohibition.
.Deputy Commissioner of Prohibition.
Deputy Commissioner of Prohibition.
:,,
*;
.? ^ .
);-;:.,... .
.;
CUSTOMS' SERVICE
Frank X. A. Eble
Frank Dow
Joseph D. Nevius
C. Bernard Wait
Thomas J. Gorman
._
Commissioner of Customs.
Assistant Commissioner of Customs.
Deputy Commissioner of Customs.
..• Deputy Commissioner of Customs. Assistant Deputy Commissioner of Customs.
M I N T BUREAU
Robert J. Grant
Mary M. O'Reilly
Director of the Mint.
Assistant Director.
FEDERAL FARM.LOAN BUREAU
Paul Bestor
John H. Guill
Louis J. Pettijohn
Albert C. Williams
George R. Cooksey
Floyd R. Harrison
Chester Morrill
Leo H. Paulger
Farm Loan Commissioner.
Member.
,
.
Member. •;..,.,
Member.
Member.
Member.
Secretary and General Counsel.
Chief, Division of Examination.
BUREAU OF ENGRAVING AND P R I N T I N G
Alvin W. Hall
Clark R. Long
Jesse E. Swigart
.-i.
Director ofthe Bureau of Engraving and Printing.
Assistant Director (Administration).
Assistant Director (Production).
PUBLIC H E A L T H SERVICE
Hugh S. Gumming
Thomas Parran, jr
C O . Pierce
A. M. Stimson
F. C. Smith
W. F . Draper
Francis A. Carmelia
Ralph C. Williams
D. S. Masterson
'.
Surgeon General.
Assistant Surgeon
Assistant Surgeon
Assistant Surgeon
Assistant Surgeon
Assistant Surgeon
Assistant Surgeon
Assistant Surgeon
Chief Clerk.
General.
General.
General.
General.
General.
General.
General.
U N I T E D STATES COAST GUARD
Rear Admiral F. C. Billard
Capt. B. M. Chiswell
Kendall J. Minot
Oliver M. M a x a m . .
Commandant.
Assistant Commandant.
Chief, Division of Materiel.
Chief, Division of Operations.
o
XXX
PRINCIPAL ADMINISTRATIVE AND STAFF OFFICERS
OFFICE OF T H E SUPERVISING A R C H I T E C T
James A. Wetmore
Henry G. Sherwood
George O. Von Nerta
Acting Supervising Architect.
Executive Officer.
Technical Officer.
STANDING DEPARTMENTAL COMMITTEES
B U D G E T AND I M P R O V E M E N T C O M M I T T E E
S. R. Jacobs, Chairman.
W. N. Thompson,
D. S. Bliss.
F . A. Birgfeld.
L. O. Martin,
D. W. Bell.
J. H. Schaefer.
Marvin Wesley.
M. E. Slindee.
F . J . Lawton.
J. Qreenberg, Secretary.
C O M M I T T E E ON E N R O L L M E N T AND D I S B A R M E N T OF ATTORNEYS AND A G E N T S
S. R. Jacobs, Chairman.
James B. Corridon, Vice Chairman.
H. O. Armstrong.
P. R. Baldridge.
O. V. Emery.
J. E. Harper.
Lawrence Becker, Attorney.
Wilmer Q. Platt, Secretary.
C O M M I T T E E ON P E R S O N N E L
F. A. Birgfeld, Chairman.
J. E. Harper.
S. R. Jacobs.
C O M M I T T E E ON CIVIL SERVICE R E T I R E M E N T
F. A. Birgfeld, Chairman.
J. E. Harper.
W. N. Thompson.
Frank Dow.
C O M M I T T E E ON S I M P L I F I E D O F F I C E P R O C E D U R E
F . A. Birgfeld, Chairman.
W. T. Sherwood.
J. L. Nuber.
A. W. Starratt.
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ORGANIZATION OF T H E TREASURY DEPARTMENT
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XXXI
B
ANNUAL REPORT ON THE FINANCES
TREASURY DEPARTMENT,
Washington, November 20, 1929,
S I R : I have the honor to make the following report:
During the fiscal year 1929 the Federal revenues reflected the
prosperity prevailing in the calendar year 1928, which not only
increased the incomes of corporations taxable as such, but also
increased the taxable income distributed to individuals. This
prosperity was reflected in increased wages and profits from industry
and commerce and in the rising prices of securities, particularly
stocks, realized gains on the sales of which increased individual incomes and, to an even greater extent, the tax collections. The active
and prosperous business conditions prevailing in the calendar year
1928 continued into the calendar year 1929.
Variations in business and financial conditions are an important
factor in determining Federal Budget results. The formulation of
future Budgets, as well as plans for handling the Federal debt, must
be based upon a careful study of current and prospective business
and financial conditions.
BUSINESS AND FINANCIAL CONDITIONS DURING THE FISCAL YEAR
1929
Business conditions ^
Business conditions during the fiscal year were highly satisfactory,
the changes revealed by various index. numbers showing distinct,
advancement in production and distribution.
Volume of business.—The physical volume of industrial production
for both manufactures and minerals was slightly higher at the beginning of the fiscal year than at any time during the preceding year,
and each succeeding month showed substantial gains over the corresponding month a year earlier. The usual seaisonal decline expected
during the late fall and early winter months was not realized. The
total increase/during the year was somewhat over 10 per cent. This,
increase more than offset a decline of 3 per cent between 19.27 aiid
1928, but the net increase of 7 per cent gyer thev2-year period represented an average annual increase which approxinaated;the.eustomary.
long time rate of growth.
j , v^ v.-; r
71799^-30—FT 19 2 0
3
1
2
R E P O R T O N T H E FINANCES
Automobile production during the year set a new high record with
an increase of approximately 53 per cent. Production during the early
winter months declined less than usual, and the increase during the
spring and summer of 1929 was far in excess of last year. Part of
this increase was due to the resumption by the Ford factories after
a period of greatly retarded activity.
The production of steel ingots, for which the manufacture of
automobiles constitutes one of the major sources of demand, increased. However, the demand for steel in other lines did not
parallel that for automobiles and therefore the net increase was
only 22 per cent, or less than half the increase for automobiles.
The increased volume of manufacture has been accomplished partly
through increased labor efficiency and the use of more machinery.
During the fiscal year, however, there was a 2.6 per cent increase in
factory employment and a 5.7 per cent increase in pay rolls, in contrast to the downward trend noticeable in earlier years.
)
Freight-car loadings increased 4.3 per cent during the year. The
reduction in loadings of livestock and forest products was more than
offset by increases in grains, coal, coke, ore, less-than-carload merchandise, and miscellaneous products.
Building construction was one of the few lines of industrial activity
showing decreases. The net decrease as measured by contracts
awarded was 5.2 per cent. This decline may be attributed in part
to the higher interest rates prevailing. The construction^ of industrial building apparently was not hampered by a lack of funds since
building of this character showed a 28.7 per cent increase. Residential construction, on the other hand, decreased 15.3 pei* cent.
Commodity prices.—There was no important change in the price
situation. Although the wholesale prices of all commodities at the
end of the year according to the index numbers of the Bureau of Labor
Statistics were nearly 2 per cent lower than at the beginning, the average of such prices for the whole of the fiscal year was 0.88 per cent
higher than for the preceding year.
Trade.—Distribution of goods to consumers by chain stores, department stores, and mail order houses showed a continuation of the trends
of recent years. The continued rapid increase in chain store, sales
must be discounted somewhat because a large proportion of the growth
is due to the change in the number of stores operated. The large
mail order houses have also entered this field by establishing numerous
branch stores of the department store type in various cities.
The foreign trade of the United States approached $10,000,000,000.
Exports were 5.4 billions and general imports 4.3 billions. This was
an increase of 10.2 per cent in exports and 3.5 per cent in imports over
the preceding fiscal year.
SECRET.\RY OF T H E TREASURY
3
Business profits.—These changes in the physical volume of production, trade, and price level, together with changes in interest rates,
all have an effect on profits, but there are other determining factors,
such as efficiency of management and labor, and inventions aiid improvements. The business developmeiits of the year are reflected in
the revenues primarily through changes in the net income and tax
returned by corporations and individuals. Since income tax returns
are largely made on the calendar year basis, the changes in profits will
be considered by calendar rather than .by Government fiscal year
periods.
Complete data from income tax returns for the calendar year 1928
are not now available, but the data on hand indicate that the net
income of corporations to be reported for tax purposes will have
increased about 11 per cent over 1927. For individual incomes, extraordinary profits from sales of assets and the continued increase in
income from other sources account for greater tax receipts during the
latter half of the fiscal year. The effect of part of this increase
will be carried over into the first half of the fiscal year 1930, that is,
to collections from July to December, 1929; and the collections for the
last half of the fiscal year 1930 will depend largely on the business
conditions of the calendar year 1929.
Agriculture.—Only a very minor part of Federal taxes are collected
directly from those engaged in agriculture. Corporation taxes very
seldom apply and many individuals engaged in this industry are
exempt from individual income taxes. Indirectly the changes in agriculture play an important role both as cause and as effect of changes
in net income in other industries. Developments in agriculture also
have an important interrelationship with receipts from customs and
with the expenditures of the Department of Agriculture and of the
new Federal Farm Board. According to figures published b y , t h e
Department of Agriculture, the gross income of agriculture increased
during the fiscal year from 12.3 billions to 12.5 billions, or less than
2 per cent. The income from cotton production remained constant,
that from meat animals and from dairy and poultry products showed
some gains which were in part offset by decreases from grains,
fruits, and vegetables. The net income available for the total capital
invested in agricultural production, including rewards for management, increased from 2.72 billion to 2.75 billion. Of these amounts
1.17 and 1.19 billion represented returns to the operators as rewards
for management and returns on their net capital invested. The average prices received by farmers and those paid by farmers for commodities bought were practically the same in the fiscal year 1929 as
in 1928, although the month to month changes during the years were
not identical.
4
R E P O R T O N T H E FINANCES
Financial conditions
The outstanding financial events of the fiscal year affecting either
Federal revenues or expenditures were the continuance of an active
and rising stock market, declining bond prices, a change in the character of security flotations, and the emergence of relatively high
interest rates.
Stock market activity.—Stock market activity was characterized by
rising prices, increased turnover or sales, and increased brokers' loans.
The number of shares of stock sold on the New York Stock Exchange
alone increased from 720,000,000 during the fiscal year 1928 to 1,042,000,000 in 1929, an increase of 44.6 per cent. The total value of
domestic capital stock issues increased from $2,343,000,000 to
$5,259,000,000, or 124.5 per cent. The increase in the turnover of all
stocks and in the issuance of new domestic capital stock accounts for
a large increase in the collections from the stamp tax on capital stock
transfers and issues. The gains realized from such turnover also
account for a large part of the increased revenue from individual
income taxes.
New financing and refunding.—There were significant changes in
the character and amount of new securities offered, in the securities
issued for refunding purposes, and in the offerings of new foreign
securities. Securities offered solely by domestic business corporations
amounted to $7,011,600,000, exclusive of ref unding issues, an increase
of $2,486,200,000, or 54.9 per cent over the preceding year. Of the
amount offered $3,224,200,000 was in the form of common stock, an
increase of 280 per cent, and $1,418,400,000 in the form of preferred
stock, an increase of 46.8 per cent. The balance, representing bonds
and notes, decreased 12.6 per cent. Issues of securities by domestic
corporations for refunding purposes in the form of bonds, notes, and
preferred stock decreased from $2,039,400,000 to $603,500,000, while
refunding through the issue of common stock increased from $154,400,000 to $505,400,000. Foreign securities offered in the United
States, exclusive of refunding issues and consisting chiefly of bonds,
decreased from $1,505,600,000 to $871,000,000, or over 42 per cent.
Future Federal tax receipts should not be materially affected by
the change in corporate financing, from bonds to stock, although the
source of some tax receipts.is shifted. Losses from taxes formerly
collected from individuals upon their receipts of interest from corporations will probably be more than recouped-' from corporations
because an equivalent amount of interest will no longer be deducted
by corporations in computing their taxable net income.
Interest rates.—^Under the pressure of demand for funds arising
out of the extraordinary situation prevailing in the stock market,
interest rates rose during the fiscal year and increased the interest
^cost to the Federal Government.
SECRETARY OF T H E TREASURY
5
Interest rates were rising at the beginning of the year, declined
somewhat during the fall months, and rose again, beginning in January. The discount rate was increased at seven Federal reserve banks
from 4K to 5 per cent in July, 1928, followed by advances at other
banks, the 5 per cent rate prevailing by May 20, 1929. The New
York bank raised its rate to 6 per cent on August 9, 1929. Interest
rates, measured by the yields of 60 high-grade bonds, rose from 4.50
per cent in June, 1928, to 4.73 per cent in June, 1929, and commercial
paper rates during the same period rose from 4%-5 to 6 per cent.
Federal Government borrowing was effected at much higher
costs than during the preceding fiscal year. The Federal Government floated issues of certificates of indebtedness with 3% and 4 per
cent coupon rates in June, 1928, but had to offer 4K per cent in September, 1928, 4:Yi per cent in October, 1928, and March, 1929, and
5}8 per cent in June, 1929, there being but one recession in the advance
in rates, that of a 4}4 per cent issue in December, 1928. These rates
were distinctly higher than in the preceding fiscal year when the
coupon rates varied from 3 to 4 per cent, so that the average rate
paid upon the entire Federal interest-bearing debt at the end of the
year was 3.95 per cent as compared with 3.88 per cent oae year
earlier.
BUDGET RESULTS
The surplus
The fiscal year 1929 closed with a surplus of $184,787,035 of ordinary receipts over expenditures chargeable against ordinary receipts,
according to the daily Treasury statement, unrevised. Of this surplus
$123,601,014 had been applied to retire the public debt during the year
and the balance was carried forward as an increase in the net balance
in the general fund, to be applied to debt retirement shortly after
the beginning of the fiscal year 1930.
Measured in terms of total receipts, the surplus amounted to 4.58
per cent. A small margin of safety in the form of a surplus is far
more desirable than a deficit; especially since there is a large public
debt outstanding to which small surpluses can be applied, thereby
permanently reducing interest charges.
b
REPORT ON T H E FINANCES
The surplus this year was the smallest since 1921. The annual
surpluses since 1921 are shown in the following table:
Ordinary receipts, expenditures chargeable against ordinary receipts, and surplus,
1922 to 1929
[On basis of daily Treasury statements (unrevised)]
Total ordinary
receipts
Fiscal year
1922
1923
1924 1925
1926
1927
1928
1929 . -
-
_
$4,109,104,151
4, 007,135,480
4, 012, 044, 701
3, 780,148, 684
3,962, 755, 690
4,129, 394, 441
4, 042,348,156
4, 033, 250, 225
Expenditures
chargeable
against ordinary
receipts
$3, 795,302, 500
3, 697,478, 020
3, 506, 677, 715
3, 529, 643, 446
3, 584, 987,873
3,493, 584, 519
3, 643, 519,875
3,848,463,190
Surplus
$313,801,651
309, 657,460
505, 366,986
250, 505,238
377, 767,817
635, 809,922
398,828,281
184,787,035
Expenditures chargeable against ordinary receipts declined sharply
during the fiscal years 1920 to 1923, from $6,482,000,000 to $3,697,000,000, and reached their lowest point, $3,494,000,000, during the
fiscal year 1927. Receipts declined from $6,695,000,000 in 1920 to
$3,780,000,000 in 1925, except for a slight increase in 1924, increased in
1926 and 1927, and remained above $4,000,000,000 in 1928 and 1929.
Prior to 1929 the surpluses are not to be considered as due primarily
to the taxes collected during the various years, but to unusual receipts,
accompanied by annual savings due to the observance of strict
economy in expenditures under decreased appropriations. In the
fiscal year 1927 receipts derived from sources of a temporary nature
amounted to $414,000,000. In 1928 such receipts amounted to
$318,000,000, while in 1929 they fell to approximately $80,000,000.
Of this decrease, $149,000,000 occurred in the receipts from railroad
securities. RecQipts of back taxes on incomes decreased $41,000,000
and refunds of internal revenue increased $42,000,000, resulting in a
decrease of about $83,000,000 in net receipts from back taxes.
The chief characteristic of these unusual sources of receipts, with'
the exception of back taxes, is that they will yield little or no revenue
in future years. The surplus in 1929 probably should be viewed as
fortuitous. The extraordinary increase of $230,320,000 in the current income taxes from individuals is largely responsible for the
excess of receipts over expenditures. The total of all receipts was
practically the same as in 1928, while expenditures increased nearly
$205,000,000. Without the increase in individual income taxes' the
surplus in 1929 would have been converted into a deficit. The
amounts of increase and decrease in the several items of receipts and
expenditures are shown in the following table and more fully explained
in subsequent paragraphs:
SECRETARY OF THE TREASURY
Principal changes in ordinary receipts and expenditures chargeable against ordinary
receipts, fiscal year 1929 as compared with 1928
[On basis of daily Treasury statements (unrevised), supplemented by detail from reports by Commissioner of Internal Revenue; In millions of dollars]
Ordinary receipts
Increase Decrease
Expenditures chargeable against Increase Decrease
ordinary receipts
Receipts from taxation:
General expenditures:
1.15
33.27
Customs
Legislative
Executive proper
state Department
Internal revenue—
L68
Treasury Department
Income. t a x e s 4.80
Current corporation __
26.36
32.71
War Department
Department of Justice
1.29
,^
Current individual... 230.32
Back taxes
42.81
"V40."85'
Post Olfice Department
33.23
Interior Department
2.12
Net change, income taxes. 156. 76
Department of Agriculture... 11.23
Department of Commerce
5.60
Miscellaneous internal
Department of Labor.. __ .
1.49
revenue—
Veterans' Bureau
Tax on small ciga15.96
rettes
Other independent offices and
40.20
commissions
4.63
Tax on all other tobacco.
2.21
Stamp tax on capital
District of Columbia and un.93
classified items.:
stock transfers
13.39
Excise tax on automobiles
Net change, general expendi46.08
tures
. . . .
Admissions tax
153.18
11.64
All other internal revenue
17.37 Interest on public debt
Refunds of internal revenue re42.44
ceipts
Net change in miscellane62.62
_
ous internal revenue
13.71 Postal deficiency 2
ShiDDinsT Board
Net change in receipts from taxaCivil service retirement f u n d . . . . . 19.84
Public debt retirements
tion
176. 32
9.35
All other including trust funds
Miscellaneous receipts:
Proceeds from Governmentowned securitiesRailroad securities148*. 93
n.92
All other securities
All other receipts, including
trust funds
24.57
Net change in miscellaneous receipts
185.42
Net change in ordinary receipts...
Net change in surplus
9.10
214. 04
Net change in expenditures
chargeable against ordinary receipts
.10
53.44
18 99
10 06
204.94
1 Includes adjustment to basis of daily Treasury statements (unrevised).
2 In addition to 42.81 million dollars shown above, of which amounts combined, nearly 62 millions
represent payments of so-called back railway mail pay.
Receipts
The total ordinary receipts of the Federal Government during the
fiscal year 1929 were $4,033,250,225, a decline of over $9,000,000 from
the fiscal year 1928. The trend in receipts by major sources, as
compared with preceding years, is shown in Diagram 2.
Increases totaling $176,324,747 in receipts from taxation as compared with the preceding year were more than offset by decreases in
miscellaneous receipts. Receipts from taxation, strictly speaking,
represent that portion of the Government revenue which is derived
from authorized levies upon the people primarily to secure funds for
the conduct of governmental activities. Nontax receipts are composed of amounts received by the Government incidental to the performance of its various functions. Among these are receipts of
8
REPORT ON T H E
FINANCES
interest aiid principal payinents from Governmeiit-owned obligations;
receipts from Panama Canal tolls; receipts from> sales of surplus
property, which represent the liquidation of property purchased by
the Government in preceding years; and receipts from trust funds,
which are invested as specified for the particular trust. The increase
in tax receipts of about $176,000,000 represents an apparent increase in the amount taken directly from the people for the running
of the Government. However, the actual increase in current tax
collections was nearly $217,000,000 due to the fact that collections
of taxes on incomes due in prior years decreased $41,000,000. This
increase in current tax collections was due largely to the changes in
MiLUON
DOLLARS
5,000
4^000
A L L OTHER
PROCECD5
FROM
FOREIGN O B L I G - A T I O N S
3,000
MISCELUANLOUS
INTERNAL REVENUt
2,000
INCOME
PROFITS
AND
TAXES
1.000
1923
1924
1925
1926
1927
1926
1929
DIAGRAM 2.—Principal sources of ordinary receipts for the fiscal years 1923 to 1929
0
productivity of specific sources of taxes considered in detail in the
following paragraphs.
Receipts from customs, which had reached high levels during
the fiscal years 1926 and 1927, amounting in the latter year to
$605,000,000, declined to $569,000,000 in 1928, and rose again in
1929 to $602,000,000, an increase of $33,000,000, which represents
primarily a revival from the business recession in 1927, affecting collections in the fiscal year 1928, and possibly anticipation of tariff
revision.
• Income tax receipts were larger than those of the preceding fiscal
year, yielding $2,331,000,000 as compared with $2,174,000,000 in
1928, or an iiicrease of $157,000,000. The collections from taxes
due in prior years, or back taxes, decreased from $278,000,000 in 1928
to $237,000,000 in 1929, or about $41,000,000. Smaller collections
SECRETARY OF THE TREASURY
9
from back taxes have been anticipated by the Treasury, due to the
reduced volume of unaudited returns of the war years, which were a
major source of back taxes in preceding years. The present status
of t^he audit of income tax returns is summarized on pages 28 to 38.
Current income tax collections from individuals increased from
$788,682,000 in the fiscal year 1928 to $1,019,002,000 in 1929, an
increase of $230,320,000, or nearly one-third, without any change in
the rates of tax. Most of this increase occurred during the last half
of the fiscal year and was due to the abnormally large increase in
individual incomes in the calendar year 1928. The taxes collected
on individual incomes filed for the calendar year 1928 will show an
increase of about 40 per cent over the collections for the calendar
year 1927. Some of this increase is due to the normal growth of
individual incomes, the prevailing prosperity, and the cumulative
effects of lower and more reasonable rates. A minor amount is due
to the effect on individual incomes of reduced taxes on corporations,
but the bulk of the increase is due to the unusual profits realized in
the calendar year 1928 on the exceedingly active and constantly rising
stock market.
Current income taxes from corporations decreased from $1,108,054,000 in the fiscal year 1928, to $1,075,348,000 in 1929, a decrease
of $32,706,000. This decrease is due primarily to the reduction in
the tax rate from 13 K to 12 per cent on corporation incomes earned
after December 31, 1927. Since the percentage reduction in taxes
collected was not as great as the relative reduction in the tax rate,
it is apparent that the increase in incomes in 1928 was almost large
enough to offset the effect of the decline in business in 1927 and of
the reductions in tax rates in 1928.
Receipts from miscellaneous internal revenue taxes declined from
$621,000,000 to $607,000,000, or $14,000,000. Increased collections
from tobacco products and from documentary stamps were more than
offset by decreases due to tax reductions applying to admissions
and automobiles. These changes are summarized graphically in
Diagram 3.
The effect of the act of 1928 on miscellaneous internal revenue is
very evident. The repeal of the excise tax on manufacturers' sales
of automobiles caused a reduction in taxes from this source of
$46,000,000. The changes in the tax on admissions reduced taxes
$12,000,000.
These decreases from tax reductions were nearly offset by the
increase in tobacco taxes and the stamp tax on sales or transfers of
capital stock. The latter increased from $24,200,000 to almost
$37,600,000, or over 55 per cent, due to the enormous turnover of
securities on the stock market. Tobacco taxes increased faster than
the average rate of growth in recent years. Collections from all
10
REPORT ON T H E FINANCES
tobacco taxes increased from.$396,000,000. in 1928 to $434,000,000 in
1929.
The tax on small cigarettes showed an increase of $40,200,000,
while the tax on all other tobacco decreased $2,200,000.
Collections on tobacco in recent years have been increasing at a
rate varying from about 5 to 7 per cent each year but increased
slightly more than 9.6 per cent during the last fiscal year. These
collections yielded 64 per cent of the miscellaneous internal revenues
in the fiscal year 1928 and over 71 per cent in 1929. The tobacco
taxes constitute not only the major source of internal revenue other,
than income taxes, but also the source which has been least affected
by changing business conditions.
Miscellaneous receipts from nontax items decreased from
$678,400,000 in 1928 to $493,000,000 in 1929, or about $185,000,000.
MILUON
DOLLARS
UOOOf
800
600
ESTATE TAX
AUTOMOBILE T A ; ^ E S ,
400f
''*''° I TOBACCO TAXES
EOO
XSZ-b
1924
1925
1926
1927
1928
1929
DIAGRAM 3.—Principal sources of miscellaneous internal revenue collections for the fiscal years 1923 to 1929
Considerably more than half of these receipts are derived from
Government assets which are in the process of liquidation, such as
interest and principal payments on Government-owned securities,
and sales of surplus property. Small amounts are derived from a
wide variety of minor sources. The more important changes during
1929 were in the receipts from Government-owned securities. Proceeds from Government-owned securities, other than foreign obligations, were $22,500,000, or $151,000,000 smaller than in the preceding
year.
The Treasury's estimates for the fiscal year 1929 of receipts from
the corporation tax and from back taxes were reasonably accurate,
but owing to the unprecedented conditions, which it was impossible
to forecast with certainty, the receipts from individual income taxes
SECRETARY OF THE TREASURY
11
were considerably underestimated. Customs duties, including the
tonnage tax, were estimated at $582,000,000, an underestimation of
$20,000,000. This increase is accounted for in large measure by the
larger imports of sugar following the removal of Cuban control and
by the imports anticipatory of the impending changes in our tariff
rates, experience having shown that imports tend to increase prior to
tariff legislation. Miscellaneous internal revenue receipts exceeded
the Treasury estimates by $30,000,000. This difference between the
actual miscellaneous internal revenue receipts and the receipts as
estimated by the Treasury is accounted for principally by two items—
$12,000,000 excess of estate tax receipts over estimates and the
$13,000,000 increase in transfer stamp tax collections due to the
unusual activity in security markets.
Expenditures
Total expenditures chargeable against ordinary receipts amounted
to $3,848,463,190 as compared with $3,643,519,875 in 1928, or an
increase of $204,943,315. The principal items of increase consisted
of increased postal expenditures of $105,000,000 payable from the
Treasury, of which $52,000,000 ($43,000,000 included with Post Office
Department, $9,000,000 with postal deficiency) were for compensation to railroads for mail transportation as a result of a recent Supreme
Court decision, of increased internal revenue refunds of $42,440,000,
of increased naval expenditures of $33,230,000, of flood control, and
other expenditures connected with flood relief of $27,900,000, of the
first governmental contributions to the civil service retirement fund
of $19,950,000, of $15,960,000 increased Veterans' Bureau expenditures, of increased public building expenditures, and of increased
compensation to Government employees. The principal items
offsetting these increases are $50,000,000 for war claims paid in 1928
and a decrease in interest paid of $53,430,000.
Expenditures as compared with the Budget estimate show an
increase of $53,720,000. Though there are a number of decreases
and increases in the expenditures of the various departments which
to a large extent offset each other, this is accounted for principally by
three items—$52,000,000 paid to the railroads, as mentioned above,
an increase of some $38,770,000 in internal revenue refunds, and a
$12,167,000 loan to the Greek Government, or a total of $102,937,000.
This amount of increase was partially offset by reduced expenditures
in various directions totaling some $49,217,000.
THE PUBLIC DEBT
General review of operations
The retirement of the war debt proceeded during the fiscal year
1929 in accordance with the established program. Exclusive of
one-day special certificates of indebtedness, public debt issues
12
REPORT ON T H E FINANCES
aggregated $2,815,341,732.37, retirements aggregated $3,488,434,547.70, and the gross debt was reduced from $17,604,290,562.93 to
$16,931,197,747.60. The reduction of $673,092,815.33 was brought
about through expenditures aggregating $549,603,703.75 for sinking
fund and other accounts chargeable to ordinary receipts and through
the application of $123,489,111.58 surplus receipts.^
BILLION
DOLLARS
»o
£5
/
t^ \
v^ — ^
- - - -
20
~- —
/
15
/
/
/
5
/
1916
I9n
1918
1919
1920
1921
19ZZ
1923
19Z4
1925
1926
1927
1928
1929
DIAGRAM 4.—Interest-bearing debt outstanding from January, 191G, to June, 1929
The refunding of the third Liberty loan, which matured on September 15, 1928, was completed in the early part of the fiscal year
through an issue on July 16, 1928, of 3% per cent Treasury bonds of
1940-1943, in amount $359,042,950, and through two issues of Treasury certificates of indebtedness, 02 per cent, Series TJ-1929, on
September 15, 1928, in amount $549,310,700, and 4% per cent. Series
TS-1929, on October 15, 1928, in amount $308,806,000. A full
account of these issues was given in my report for 1928. On October
31, 1929, a balance of $14,757,450 third Liberty loan bonds had
not been presented for payment.
Other financing during the year was restricted to the usual quarterly issues of Treasury certificates of indebtedness at the maturities
of other certificates. On December 15, 1928, three series of certificates became due, in total amount about $530,000,000, and the
Treasury offered for that date two series of 4K per cent Treasury
certificates of indebtedness, one in amount $209,918,000, with nine
months' maturity, and the other in amount $310,245,500, with
maturity of one year. In the latter half of the fiscal year three
series of certificates matured—two series on March 15, 1929, in total
amount $506,000,000, and one series on June 15, 1929, in amount
$470,000,000. To meet the Treasury's requirements in such respects,
two series of Treasury certificates of indebtedness were issued—one
1 Figures are on the basis of dally Treasury statements (revised).
13
SECRETARY OF THE TREASURY
on March 15, 1929, at 4% per cent, with nine months' maturity, in
amount $475,998,500, and the other on June 15, 1929, at 5}^ per cent,
likewise with nine months' maturity, in amount $404,209,500.
Copies of the circulars governing these issues, together with public
announcements concerning them, will be found with the appended
exhibits.
In the first quarter of the fiscal year 1930 there was offered for
subscription on September 6 an issue of 4% per cent Treasury certificates of indebtedness, dated September 16, with a nine months'
maturity, to meet the Treasury requirements, and in particular to
provide for about $510,000,000 maturing certificates on September
15, 1929. In connection with this issue the Treasury offered to
purchase up to $100,000,000 face amount 3K per cent Treasury notes
of Series A-1930-1932, B-1930-1932, and C-1930-1932, through the
optional tender of such notes at 98, in part payment of subscriptions
P t S CENT
5.5
v'S.p
•
,
•.
A..5
jT-
4.0
/
3.5
3.0
2.5
t.5 1916
J
^-— ^ ^ --—
^"^
-\
/
^
/
J
1917
'
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
DIAGRAM 5.—Ratio of the computed annual interest charge to the amount of interest-bearing
,..public:debt putstf^nding at the end of.each.month, from June 30, 1916, to June 30, 1929
for the new certificates. For this issue subscriptions aggregating
$1,480,696,500 were received, and a total of $549,707,500 was allotted
and issued. The official circular and the public announcements
pertaining to this issue will be found appended to this report.
This issue of 4% per cent Treasury certificates of indebtedness is
the first under the act of June 17, 1929, which authorized issues
exempt, both as to principal and interest, from all taxation except
estate and inheritance taxes. The exceptionally large oversubscription for the offering is attributed in part to the tax-exempt
feature, as it constitutes an inducement to purchase for individual
investors desirous of obtaining more complete exemption from the
surtaxes as well as from the normal rates levied on incomes. There
was no additional inducement given for coxporations to.,subscribe,
as they have enjoyed exemption from income tax on such issues lihder
earlier statutes.
14
REPORT ON THE FINANCES
Postwar debt reduction
The war debt reached its highest point on August 31, 1919. In the
full decade thereafter ending on August 31, 1929, the gross debt outstanding had been reduced from $26,594,267,878.45 to $16,805,433,171.38, a decrease of $9,788,834,707.07, which was accomplished (1)
through expenditures aggregating $4,451,698,144.15 chargeable to
ordinary receipts under the established program for the liquidation of
the debt; (2) through the application of $4,367,624,774.93 surplus of'
ordinary receipts; and (3) through net reduction of $969,511,787.99
in the general fund balance. The annual interest charge on the
interest-bearing debt outstandmg on August 31, 1919, was $1,105,690,254, and on August 31, 1929, $652,471,596. The gross debt
PER CENT
OUTSTANDING
PER CEMT
PAID
60
12
16
YEARS AFTER
eo
PEAK
J^oo
DIAGRAM 6.—Gross public debt outstanding relative to war peaks from year before declaration of
war to year following low point
outstanding was reduced 36.8 per cent during this 10-year period,
and the interest-bearing debt was reduced 37.3 per cent, the larger
per cent reduction in interest-bearing debt being occasioned through
slight increases as between the two dates in matured debt on which
interest had ceased and in debt bearing no interest. During this
10-year period the annual interest charge was reduced 41 per cent.
The effect of the reduction in interest charge is offset in part by the
appropriation for the sinking fund each year of the amount of interest
which would have been paid during the year on the bonds and notes
retired through the sinking fund, as provided by law.
It is of interest to compare the relative rapidity of debt reduction
since the World War with other postwar periods. The gross public
SECRETARY OF T H E TREASURY
T5
debt outstanding, relative to war peaks, is shown graphically in
diagram 6 for periods from the year preceding'each declaration of
war to the year after the debt reached its subsequent low point.
The curves are drawn so that peaks of gross debt, calculated in each
case as 100 per cent, coincide. The curves for each war show the
relative liquidation of the gross debt in each postwar period. According to this graphic comparison, the debt reduction since 1919 has
been quite similar to that of other postwar periods.,
Treasury war-savings certificates
-'^^^
On July 15, 1929, one of the most interesting features of the war
financing was brought to a close, when a small ainount of the series of
1924 Treasury savings certificates matured. I t will be recalled that
two forms of obligations were issued—(1) war-savings certificates,payments on account of which were evidenced by war-savings stamps,
each having a maturity value of $5, and (2) Treasury savings certificates, in amounts $25, $100, and $1,000 maturity value. Thrift
stamps at 25 cents and Treasury savings stamps at $1 each also were
sold for the purpose of accumulating amounts to purchase the principal securities. Both war-savings stamps and Treasury savings
certificates were sold on a discount basis, the principal amount being
payable on a fixed date five years or less from date of issue, but were
redeemable on demand at lesser amounts. Through the sale of
these securities, which extended from December 3, 1917, to July 15,
1924, cash aggregating $1,623,126,446.89 was received into the Treasury. To June 30, 1929, adeemed discount aggregating $227,488,696.87
had been paid or placed to the credit of outstanding certificates, making the total redemption value to that date $1,850,615,143.76, all of
which has been paid except $25,809,656.33 outstanding on that date,
including a balance of $13,028,019.35 maturing on July 15, 1929.
The sale of Treasury war-savings certificates was conducted through
a country-wide organization, and sales agents included all post
offices, banks, and thousands of other agents specially designated.
For the conduct of the sale and exchanges of one form of security for
another, 829,905,193 pieces were issued, having a maturity value of
$2,098,733,317,75.
Cumulative sinking fund
For the fiscal year 1929 an appropriation of $370,241,327.02 was
available for debt retirement through the cumulative sinking fund.
This appropriation, in accordance with the provisions of section 6
16
REPORT ON T H E FINANCES
of the Victory Liberty loan act approved March 3, 1919, as amended,
was derived as follows:
Unexpended balance from 1928
:
S838. 07
Appropriation for 1929:
Initial credit
.
._
.
253, 404, 864. 87
2)4 per cent of the aggregate amount of Liberty bonds
arid Victory notes outstanding on July 1, 1920, less
an amount equal to the par amount of any obligations
of foreign governments held by the United States on
July 1, 1920.
Secondary credit
:._____
116, 835, 624. 08
The interest which would have been payable during the
fiscal year for. which the appropriation is made on
the bonds and notes purchased, redeemed, or paid
out of the sinking fund during such year or in previous years.
Total
._..
..
.-__.__...__
370, 241, 327. 02
Debt aggregating $370,277,100 face amount was retired during the
year at a total principal cost of $370,241,297.84, as follows:
Par amount
Third 4H's..—
—.
.-.
SJ-^ per cent Treasury notes, A-1930-1932
Total
Principal cost
$365,325,800. 00
4,951,300.00
$365,401,371.06
4,839,926. 78
370, 277,100. 00
370,241,297.84
An unexpended balance of $29.18 has been carried over to the fiscal
year 1930.
The cumulative sinking fund was established on July 1, 1920.
The following shows the operations by fiscal years to the end of 1929:
Appropriation
available »
Fiscal y e a r
1921
1922
1923
1924-.
1925
1926 . .
1927
1928
1929
Total
-
.
^.^
-
E x p e n d e d (principal cost)
$256, 230,010. 66 . $254,844,576.50
274.481,902.16
274, 5i6,965. 89
284,149, 754.16
284,156, 439.19
294,927,019. 57
294,927,023. 26
306, 666, 736. 01
306, 666, 759. 52
321,184, 468. 20
321,184, 577. 22
336, 890,832. 47
336.890,916.27
355,080, 563.11
355,081, 401.18
370, 241, 297. 84
370, 241, 327. 02
2,7.98. 467,179. 20
2, 798, 467,150. 02
D e b t retired
(par a m o u n t )
$261, 250, 250. 00
275,896,000. 00
284,018, 800. 00
295,987, 350. 00
306, 308, 400. 00
317,091, 750. 00
333. 528, 400. 00
354, 741, 300. 00
370, 277,100. 00
2, 799,099,350.00
1 Unexpended balance each year excluded from total, and included in appropriation available for next
year. Unexpended balance $29.18 at end of 1929.
SECRETARY OF THE TREASURY
17
The particular issues retired during this period follow:
Par amount
Liberty bonds:.
First ZWs.
First 4's.'
First 4H's
Second 4's.Second 4K's
Third iH's
Fourth iH's
Victory notes:
ZH's
iH's
Treasury notes:
5]^i per cent.
i H per cent.
m per cent.
4H per cent,
i H per cent,
i H per cent.
iy2 per cent,
i H per cent,
3J,^ per cent,
_
Series B-1924
Series A-1925
Series B-1925
Serias C-1925
Series A-1926
Series B-1926
Series A-1927
Series B-1927
Series A-1930-1932.
Total..-.
Principal cost
$11,000.00
1,000.00
24. 850. 00
670,900. 00
374, 735, 400. 00
1,261,876,000.00
13, 943, 650. 00
$11,000.00
1,000.63
24,855.00
671,196. 27
374,988,667. 88
1, 268, 640, 946. 97
13,867, 063. 25
106,186, 900. 00
610, 584,150. 00
104, 542, 256. 28
604, 769, 347. 07
103,000,000. 00
101, 000, 000. 00
11,315,900.00
113,199,900.00
1, 018, 300. 00
9, 564, 200. 00
26, 798, 000. 00
60, 217,900. 00
4,951,300. 00
103, 028, 635. 62
. 101,004,123. 53
11,279,715.38
113,196, Oli. 61
1,018,300.00
9. 485, 492. 59
26,880,711.16
60, 217,900. 00
4, 839,926. 78
2, 799,099, 350. 00
2, 798, 467,150. 02
CONDITIOIsr OF THE TREASURY
On June 30, 1929, the gross public debt of the United States Government amounted to $16,931,197,748, and the net balance (cash) in
the general fund of the Treasury on the basis of daily Treasury statements (revised) was $324,506,851. These figures represent a decrease
of $673,092,815 in the pubhc debt, and an increase in the net balance .
(cash) of the Treasury of $64,316,520 in the fiscal year 1929.
' Bullion and coin amounting to $2,010,411,679 on June 30, 1929,
held in trust by the Treasury against United States currency outstanding showed a decrease of $132,388,549 during the fiscal year.
Bullion and coin, amounting to $1,562,425,579 on June 30, 1929,
held in trust by the Treasury for the Federal Reserve Board, showed
an increase of $174,775,166 during the fiscal year.
General fund qf the Treasury
All cash receipts of the Government, except as otherwise authorized
-by law, are credited into the general fund and all expenditures are
made therefrom. This fund shows the assets in the Treasury in the
form of cash and deposit credits and certain current liabilities set
off against such assets. The net balance of this fund represents the
working cash balance required in connection with the receipts and
expenditures of the Government. The net change from the close of
the previous fiscal year is accounted for as follows:
71799-—30—FI1929
4
18
REPORT ON THE FINANCES
Summary of the net change in the general fund balances between June 30, 1928,
and June 30, 1929, on the basis of daily Treasury statements {revised)
Amount
$265, 526,980. 79
Net balance per daily Treasury statement, June 30, 1928
5, 336, 649. 94
Deduct net excess of expenditures over receipts in June reports subsequently received....
Net balance June 30, 1928 (revised)
260,190,330. 85
Excess of ordinary receipts over expenditures chargeable against ordinary receipts in the
•r .fiscal-year^1929.j
i-.-.-.-.
1...
1
.--.
187,805,631. 56
Total to be accounted for-
447,995,962.41
Public debt retirements from surplus revenue
(This is additional to $549,603,703.75 sinking fund and other debt retirements chargeable against ordinary receipts.)
Net balance in the Treasury June 30,1929 (revised)
123,489, 111. 58
324, 506,850. 83
Total..
447,995,962.41
General fund of the Treasury, June 30, 1929 {revised figures)
In Treasury oflBces:
Gold
standard silver dollars
United States notes
Federal reserve notes
Federal reserve bank notes
National-banknotes
Subsidiary silver coins
. Minor c o i n s : . . . . - : - ' . — —
Silver bullion (at cost)
Unclassified (collections, etc.)
-
1
—J
——i
-
In Federal reserve banks:
To credit of Treasurer of United States
Intransit
-
$175,568,898.06
18,364,967.00
2,271,041.00
652,630.00
88,154.00
34,400.00
2,341,685.28
2,002,465; 78
6,747,458.02
1,166,997.26
$209,238,696.40
35,891,389.40
6,864,737.78
42, 756,127.18
In special depositary banks: Account of sales of Treasury bonds and certificates of indebtedness
356,841,912.95
In general and limited depositary banks:
To credit of Treasurer of United States
$7,202,830.19
To credit of other Government oflacers18,800,198.96
Intransit-.-'..
2,407,912.75
28,410,941. 90
In foreign depositary banks:
To credit of Treasurer of United States
309,331.85
To credit of other Government oflicers
1,290,288.40
In transit
-.-—
573,319. 91
2,172,940.16
In treasury of Philippine Islands:
To credit of Treasurer of United States
1,001,055.41
Intransit
3,027.79
1,004,083.20
Total current assets
Deduct current liabilities:
Federal reserve note 5 per cent fund (gold)
Less notes in process of redemption
640,424,701.79
i
$168,871,032.57
455,490.00
—
•
168,415,542.57
National-bank note 5 per. cent fund.
, 28, ,427,196. 96
Less notes in process of redemption.
15,269,225.00
13,157,971.96
Treasurer's checks outstanding
_
2,831,814.40
Post Office Department balance.-.
59,833,372.53
Board of trustees. Postal Savings System, balances
8, 689,130.29 .
Balance to credit of postmasters, etc
60,929,119.18
Retirement of additional circulating notes (act of May 30, 1908)
1,950. 00
Uncollected items, exchanges, etc
2,058,950.03
:
315,917,850.98
Balance in Treasury June 30, 1929..—
:
324,506,850.8
The currency trust fund and the gold reserve fund
The respective amounts of gold coin and bullion, and silver dollars
held in the Treasury on June 30, 1929, against equal amounts of
outstanding gold certificates, silver certificates, and Treasury notes of
1890, were as follows:
19
SECEETABY OF THE TKEASUBY
Crold coin and bullion.
.•Silver dollars
:Silver dollars, 1890
Total
1, 384, 335, 199
468, 753, 942
1, 283, 450
„
-
1, 854, 372, 591
On June 30, 1929, the gold reserve against United States notes and
Treasury notes of 1890 was $156,039,088. The United States notes,
for which this reserve is held, are outstanding in the amount of
$346,681,016, a sum which is fixed by law. When such notes are
Teceived they are reissued. The Treasury notes of 1890, for which
this gold reserve is also held, were outstanding on June 30, 1929, in
the amount of $1,283,450. When such notes are received they are
not reissued.
Gold held for the Federal Reserve Board
. The Treasury also holds in trust a large amount of gold for the
•account of the Federal Reserve Board. This is known on the books
•of the Treasury as ^^ Gold fund, Federal Reserve Bo ard, ^' and amounted
on June 30, 1929, to $1,562,425,579, an increase of $174,775,166 in
the fiscal year. The fund is an aggregate of net deposits of gold
made by the Federal reserve banks, principally for the purpose of
effecting clearance settlements among themselves, and by the Federal
Teserve agents of gold received by them as part of the security against
'Outstanding Federal reserve notes.
ESTIMATES OF RECEIPTS AND EXPENDITURES
. The following table summarizes cash receipts and expenditures
•during the fiscal year 1929 and the estimated receipts and expenditures for the fiscal years 1930 and 1931 on the basis of the latest
information received from the Bureau of the Budget:
Summary of receipts and expenditures for the fiscal year 1929, on the basis of daily
Treasury statements {unrevised), and estimated receipts and expenditures for the
fiscal years 1930 and 1931
1929
Net balance in the general fund at the beginning of fiscal
year
265, 526,981
Receipts:
4, 033,250, 225
Ordinary
i 2,209, 293,135
Public debt
Total-.
6, 508, 070, 341
Expenditures:
3, 298,859,486
Ordinary
549, 603, 704
Public debt chargeable against ordinary receipts..
1 2, 332,894,148
Other public debt
326, 713,003
Net balance in the general fund at close of fiscal year.
Total..
6, 508, 070, 341
1930
326, 713, 003
1931
265, 526,981
4, 249, 263,434
1,318,466,844
5,894,443,281
4, 225, 727, 666
1,424,187,034
5,915,441,681
3,393,316,300
630, 365,600
1, 605,234,400
265, 526,981
5,894,443,281
3,467, 614, 700
635, 324, 000
1, 546, 976, 000
265, 526,981
5, 915, 441,681
POSTAL SERVICE
Postal receipts
Postal expenditures.
Deficiency in postal receipts 2..
696,947, 578
791, 647, 322
94, 699, 744
725,400, 000
809,400,000
84,000,000
754,400,000
832,900,000
78, 500,000
1 Other public debt expenditures and public debt receipts, as shown in this statement, are exclusive of
$2,984,941,500 Treasury certificates issued and retired within the same fiscal yeari
2 The postal deficiency for 1929 and the estimated postal deficiencies for 1930 and 1931 are included in the
ordinary expenditure shown above and in the general classification of ordinary expenditures and estimated ordinary expenditures on p. 21.
20
REPORT ON T H E FINANCES
Ordinary receipts, and expenditures chargeable against ordinary
receipts, for the fiscal year 1929, on the basis of daily Treasury statements (unrevised), with corresponding estimates for the fiscal years
1930 and 1931, are shown in the table below. Ordinary receipts
include all receipts other than those arising from public-debt transactions. Ordinary expenditures exclude all expenditures for the
retirement of the public debt. Expenditures chargeable against
ordinary receipts include ordinary expenditures and the retirements
of the public debt from the sinking fund and from special earmarked
receipts, such as repayments of the indebtedness of foreign governments. Expenditures chargeable against ordinary receipts do not
include retirements of the public debt from the surplus and from a
reduction in the general fund balance and other public debt expenditures arising from public debt transactions. The estimates in the
table are on the basis of the latest information received from the
Bureau of the Budget.
Receipts and expenditures for the fiscal year 1929, on the basis of daily Treasury statements {linrevised), and estimated receipts and expenditures for the fiscal years 1930
and 1931
1929
1930
1931
RECEIPTS
Ordinary
Customs
$602, 262, 786.17 1 $602, 000, 000. 00 1 $602,000, 000. 00
._
Internal revenue:
Income tax
Miscellaneous internal revenue.
2, 330, 711, 822. 66 2, 480,000, 000. 00 2, 460, 000, 000. 00
635, 000, 000. 00
607,307, 548. 98
640, 000, 000. 00
2, 938, 019,371. 64 3,115, 000, 000. 00 3,100, 000, 000. 00
Miscellaneous receipts:
Proceeds of Government-owned securities—
Foreign obligationsPrincipal
1...
•'•^-Interest"
.
Railroad securities
All other securities
• . .
...
Trust-fund receipts (reappropriated for investment)
- .
Proceeds sale of surplus property
Panama Canal tolls, etc
Other miscellaneous
Total ordinary receipts
38, 790, 660. 67
160,340, 908: 23
15, 473, 795. 82
7, 031,516. 21
97, 614, 913. 00
141, 935, 0,95. 00
4,708,600.00
6, 699, 275. 00
51, 579, 059. 00
184,564,540 00
11, 213, 350. 00
6, 985, 540. 00
63,641,113.08
9, 398, 732. 44
28, 046, 704. 23
180, 244, 636. 56
46, 750, 000. 00
7,139, 800. 00
28, 218, 660. 00
199,197, 091. 00
39, 670, 000. 00
4, 604,300. 00
28, 060, 600. 00
197,150, 277. 00
492, 968, 067. 24
532, 263, 434. 00
4,033, 250, 225. 05 4,249,263,434.00
623, 727, 666. 00
4, 225,727,666.00
EXPENDITURES -
Ordinary (checks and warrants paid, etc.)
General expenditures:
17, 546, 655. 67
21, 702, 000. 00
28,879, 500. 00
Legislativeproper
establishment
Executive
_.
487, 250. 03
476,100. 00
410, 700. 00
state Department
13, 284, 510. 33
13, 411, 400. 00
15,821,300. 00
200, 447, 224. 41
239,340, 900. 00
Treasury Department .
.
209,301, 500. 00
War Department
416, 901, 546. 42
443,153, 000. 00
439,215,900. 00
28,891, 620. 32
29, 014, 500. 00
Department of Justice .
_. .
. _
31,752,000.00
2 43,090,870.27
...Post Office Department
]^avyE»(Bpar tment-.-..-• ' 364;561*543:99.
384, 965. 000. 00
385, ,000,000. 00
J Includes $2,000,000 estimated by Department of Commerce for tonnage tax, receipts on account of
which are covered into the Treasury as customs revenue.
2 Included in expenditures of the Post Office Department and also on account of postal deficiency for the
fiscal year 1929 (month of June, 1929) are $42,997,089.50 and $8,999,996, respectively, representing payment
of so-called back railway mail pay to inland carriers under authority of joint resolution approved June 6,
1929.
21
SECEETAEY OP THB TEEASUEY
Receipts and expenditures for the fiscal year 1929, on the basis of daily Treasury
statements {unrevised), and estimated receipts and expenditures for the fiscal years
1930 and 1931—Contmued
1929
1930
1931
EXPENDITURES—continued
Ordinary—Continued
General expenditures—Continued.
Interior D e p a r t m e n t
D e p a r t m e n t of A g r i c u l t u r e . .
D e p a r t m e n t of C o m m e r c e
D e p a r t m e n t of L a b o r
U . S. V e t e r a n s ' B u r e a u . .
Other i n d e p e n d e n t oftices a n d commissions
D i s t r i c t of C o l u m b i a
_.
TotaL A d d unclassified items
$301,122, 696. 27
171,147, 262. 68
39, 987, 346. 45
11,311,190.36
417. 280, 404.40
40, 308, 719. 63
40,116, 586. 38
2,106,485, 327. 51
17,803. 40
$288, 759, 700. 00
173, 796, 300. 00
68, 478, 600. 00
11, 269, 300. 00
434,451, 500. 00
51, 856, 400. 00
43,811, 200. 00
2,194,420,900.00
$285,810,000.00
167,068, 600.00
51,184,000.00
11,997,400.00
445, 325, 000. 00
45, 581, 300. 00
45,415, 000.00
2,162, 762,200.00
Total—.
.... 2,106, 503,130. 91 2,194, 420, 900. 00 2,162, 762,200.00
619, 000, 000. 00
i n t e r e s t on p u b l i c d e b t . .
656, 000, 000. 00
• 3 678,330,399.50
R e f u n d s of receipts:
21,009, 500.00
21,009, 500. 00
21, 826, 43o. 69
Customs
141,511,000.00
I n t e r n a l revenue
151, 541, 000. 00
190, 727, 887.12
P o s t a l deficiency
78,500,000.00
84, 000, 000. 00
2 94, 699, 744. 06
P a n a m a Canal
11,845, 000. 00
10, 111, 000. 00
9, 045, 647. 29
O p e r a t i o n s in special accounts:
1, 790, 000. 00
i 7, 925, 800. 00
4 1,857,633.06
Railroads
4 50, 000. 00
4 50,000.00
W a r Finance Corporation..
4 611,414.95
59, 417, 000. 00
30, 447, 700. 00
Shipping B o a r d . .
15, 889, 059.12
75, 000, 000. 00
200, 000, 000. 00
Agricultural m a r k e t i n g , loan fund
4 500, 000. 00
4 500, 000. 00
Alien p r o p e r t y funds
4 1, 345, 327. 26
111, 775, 000. 00
111, 775, 000. 00
Adjusted service certificate fund ^
111,772,809.62
20, 500, 000. 00
20,850,000.00
C i v i l service r e t i r e m e n t a n d disability fund
19, 955,190. 64
I n v e s t m e n t of t r u s t funds:
37,830, 000. 00
G o v e r n m e n t life i n s u r a n c e fund
45,110, 000. 00
52,160, 111. 83
585, 000. 00
D i s t r i c t of C o l u m b i a teachers' r e t i r e m e n t f u n d .
585, 000. 00
503,158. 37
290,000.00
Foreign service r e t i r e m e n t fund
292, 000. 00
282,444.12
General railroad c o n t i n g e n t fund
1, 000, 000. 00
1, 000, 000. 00
977, 842. 88
T o t a l o r d i n a r y expenditures
P u b l i c d e b t r e t i r e m e n t s chargeable against ord i n a r y receipts:
Sinking fund
P u r c h a s e s from foreign r e p a y m e n t s
Received from foreign g o v e r n m e n t s u n d e r
debt settlements.
Received from e s t a t e taxes
P u r c h a s e s from franchise tax receipts (Federal
reserve b a n k s a n d Federal i n t e r m e d i a t e
credit b a n k s ) . .
Forfeitures, gifts, etc
Total . . .
3, 298,859, 485. 88
3, 393,316, 300. 00
3, 467, 614, 700.00
370, 277,100. 00
571,150. 00
389,191, 500. 00
20, 050, 000. 00
395, 624, 000. 00
1,800, 000. 00
175, 642, 350. 00
20, 000. 00
214, 700, 000. 00
54, 100. 00
231, 500, 000. 00
2. 933, 400. 00
159, 703. 75
6, 210, 000. 00
160, 000. 00
6, 200, 000. 00
200, 000. 00
549, 603, 703. 75
630, 365, 600. 00
635, 324, 000. 00
T o t a l e x p e n d i t u r e s chargeable against ord i n a r y receipts
3, 848,463,189. 63
4, 023,681, 900. 00
4,102. 938, 700. 00
Excess of o r d i n a r y receipts over total e x p e n d i t u r e s
chargeable against o r d i n a r y receipts
184, 787, 035.42
225,581,634.00
122,788,966.00
3 Includes $774,912.65 accrued discount on war-savings securities of matured series.'
4 Excess of credits (deduct).
5 For details of this account see p. 96. The difference between amounts of above charges and the
amounts appropriated for investment is due to working balance required for use of Veterans' Bureau in
making authorized payments from the fund.
Public debt expenditures and receipts for the fiscal year 1929, by
types of issue, with corresponding estimates for the fiscal years 1930
and 1931, are given in the following table. Public debt expenditures
and public debt receipts, as shown in this table, are exclusive of
Treasury certificates issued and retired within the same fiscal year.
They include, however, exchange transactions in public debt issues.
22
REPORT ON THE FINANCES
Public debt expenditures and receipts for fiscal year 1929, on the basis of daily)
Treasury statements {unrevised) ,^ and estimates for the fiscal years 1930 and 1931
1929
1930
1931
EXPENDITURES
Certificates of indebtedness and Treasury bills
$1,256,116,800.00 $1,600,000,000.00 $1,600,000,000.00'
Treasury notes and certificates of indebtedness
17,000.000. 00
18,000,000.00>
16,600,000.00
(adjusted service series)
6,000,000.00
23,141, 700.00
1,000,000.00Second Liberty Loan bonds
1,208,396,150.00
15,000, 000. 00
1,000,000.00=
Third Liberty Loan bonds
15, 684,050.00
10,100,000.00
Fourth Liberty Loan bonds
497,950. 00
200,000.00'
300,000.00
Victory notes .
197,650,300.00
640.000,000.00'
660,000,000. 00
Treasury notes and bonds and Liberty bonds
141,054,
701.
70
1,000,000.00'
16,000,000.00
Treasury (war) savings securities
Retirements of Federal reserve bank notes and
21,000,000.00^
24,346, 256. 50
23,000,000.00
national-bank notes
. .
.. . ..
200,000.00
100,000.00>
109, 944.00
Old debt items
Total public debt expenditures.Deduct public debt expenditures chargeable
against ordinary receipts:
Sinking fund
Purchase of Liberty bonds from foreign repayments
.
-Received from . foreign governments under
debt settlements
Received frorh estate taxes .
Retirements from Federal reserve bank and
Federal intermediate credit bank franchise
tax receipts
Retirements from gifts, forfeitures, etc
Total
Total public debt expenditures exclusive
of public debt expenditures chargeable
against ordinary receipts
2, 882,497,862. 20 2,235,600,000.00
2,182, 300, 000. OO-
370, 277,100. 00
389,191, 600. 00
395, 624,000. 00>
671,150.00
20,050,000.00
1,800,000. oa>
175, 642, 350. 00
20,000. 00
214, 700,000. 00
54,100. 00
231, 500, 000. 00"
2, 933,400.00
159, 703. 76
6, 210, 000. 00
160,000. 00
6, 200, 000. 00'
200,000. 00'
649, 603, 703. 75 • 630,365,600.00
635, 324, 000. 00^
2,332,894,148. 46 1,605,234,400.00
1, 546,976,000.00-
RECEIPTS
Deposits to retire Federal reserve bank notes and
national-bank notes
_
.
Treasury savings securities
Other new issues of securities -_
Total public debt receipts
Excess of public debt retirements over the retirements chargeable against ordinary receipts due
to indicated surplus and decrease in general fund
balance
24, 536,457. 50
22, 600,000. 00
20,000, 000. 00'
10,015, 227. 37
650,000. 00
2,174, 741,450.00 1,295,416,844.00 1,404,187,034.00^
2, 209,293,134. 87 1.318.466.744.00
2123,601,013. 58
3 286,767,556.00
1,424,187,034.00-
122,788,966.0(5^
1 Public debt expenditures and public debt receipts, as shown in this statement, are exclusive of Treasury
certificates issued and retired within the same fiscal year.
2 Surplus, $184,787,035.42. Difference of $61,186,021.84 carried forward to 1930 as an increase in general!
fund balance, and used for debt retirement in that fiscal year.
3 Estimated surplus, $225,581,534. The sum of $286,767,556 includes $61,186,021.84 referred to in note 2.
TAX REDUCTION RECOMMENDATION
As above stated, the estimates of receipts and expenditures indicatea surplus of $226,000,000 in the fiscal year 1930, and of $123,000,000
in the fiscal year 1931.
The estimated expenditures for 1930 and 1931 include, respectively,.
$630,000,000 and $635,000,000 for debt retirement chargeable against
ordinary receipts. These amounts will increase from year to year
and are adequate to retire our public debt at a reasonably rapid Tateand in accordance with our well-established national policy.j^TheTreasury Department believes, therefore, that the taxpayers should,
receive the benefit of any prospective surplus in the form of tax
reduction.
SECRETARY OF THE TREASURY
23
A surplus may be recurring or temporary. In the one case, either
through expanding revenue or reduced expenditures, assured receipts
may have reached the point where they so exceed normal expenditures as to create recurring surpluses. Such a situation justifies a
revision, more or less permanently, of our tax laws with a view to
modifying tax rates downward.
In the second case, the surplus may be of temporary character,
arising from an unusual increase in receipts or decrease in expenditures, or the conditions while not extraordinary may not have
existed for a sufficient period of time to permit a definite conclusion
as to their permanency. Such a surplus obviously calls for different
treatment. This is particularly true of a revenue system which
places its chief reliance on one form of taxation, as we do on the
income tax, which is subject to sweeping variations depending on a
variety of circumstances but principally on the upward and downward fiuctuations of business. Under these circumstances, while
a surplus justifies some measure of tax relief and while the taxpayer
should receive the fullest possible benefits from the prosperous condition of the Treasury during the given fiscal year, it is impossible
to assure the permanency of the reduced rates.
I t is highly desirable, therefore, to introduce some element of
flexibility in our tax system in order to take advantage of a surplus
whose permanency is not assured. The alternative is to wait until a
sufficient period of time has elapsed to demonstrate that the surplus
is of a permanent character, and this necessarily implies that in the
interim the taxpayer will not receive the benefits of tax reduction.
The estimated surpluses for the fiscal years 1930 and 1931 seem to
fall into the second class, as clearly indicated by the 1931 estimates,
where the margin of estimated receipts over estimated expenditures is
but $123,000,000, as contrasted with a fluctuation of over $300,000,000
in individual income tax receipts in a single calendar year.
Moreover, the problem of estimating future revenue is attended by
extraordinary difficulties at the present time due to the existence of a
number of factors the effect of which it is almost impossible to foresee*
The surplus of the fiscal year ended June 30 last and the current
year's probable surplus was and will be due to a very large extent to
the unusual increase in taxable incomes reported by individuals,
although corporations enjoyed a very prosperous year in 1928,
and all reports indicate that their 1929 income will exceed t h a t
of 1928. The income tax returned by individuals for the calendar
year 1927 was $830,000,000, and for the calendar year 1928 approximately $1,150,000,000. While wages, salaries, dividends, etc., showed
a substantial increase, the outstanding item in the increased income
returned was a gain of approximately $2,000,000,000 in profits from
the sale of capital assets, both within and without the 2-year period.
24
REPORT ON T H E FINANCES
I t is the unusual increase in this one item and the impossibility of
determining under existing circumstances what income will be returned from this source for the calendar years 1929 and 1930 that
makes estimating at this time so uncertain a proposition.
We are not only faced with the usual problem of determining the
business trend during the current calendar year and of forecasting the
business trend during the coming calendar year, but we are confronted
with the difficult problem of determining what effect the precipitous
decline of security values recently witnessed will have on the profits
from security transactions, which unquestionably yielded a very large
income in 1928 and for the first eight months of the calendar year 1929.
The immediate problem is how to give to the taxpayers the benefit
of the surplus which seems reasonably certain in the fiscal year 1930
without running the risk of incurring a deficit during the fiscal year
1931. The fact that the income tax year does not coincide'with the
fiscal year increases the difficulties of finding a solution. A flexible
normal tax rate seems to furnish the key. Excise and customs rates
do not for business and administrative reasons lend themselves to
yearly changes. A shifting schedule of surtax rates would be altogether too complicated. But the normal income tax rate is adapted
to give us flexibility. I t can be moved up or down without giving
rise to administrative difficulties or in any way complicating income
tax returns. The effect of the change on the revenues can be
calculated with reasonable accuracy. I t would affect all taxpayers
without discrimination.
The Treasury Department believes that the following program
will provide a maximum tax reduction without incurring an unwarranted risk of a deficit in 1931.
The enactment by the Congress of a joint resolution declaring:
(1) That the normal tax rate on the income of individuals for the
calendar year 1929, payable in 1930, shall be ji per cent, 2 per cent,
and 4 per cent, instead of the existing rates of 1}^ per cent, 3 per cent,
and 5 per cent.
(2) That the tax rate on the income of corporations for the calendar year 1929, payable in 1930, shall be 11 per cent instead of the
existing 12 per cent.
This should result in a decrease of income tax collections during
the calendar year 1930 of approximately $160,000,000, about equally
divided between the fiscal years 1930 and 1931.
A year from now, depending upon the revenue prospects at that
time, the Congress may pursue one of three courses:
(1) I t may make the proposed rates for 1929 income permanent;
(2) I t may pass another concurrent resolution fixing the normal
rates at this or some other point for 1930 income; or
(3) By failure,to take any action, existing rates would be automatically restored.
SECRETARY OF THE TREASURY
25
Aside from introducing uito our revenue system the principle of
a flexible rate which Congress after further experience and consideration may well decide to adopt permanently, the proposed program
applies the major part of the reduction along the very lines that the
Congress would probably follow in a permanent revenue revision.
I t distributes the benefits as widely as possible and while giving all
income taxpayers some measure of relief favors those of moderate
incomes. As pointed out in the 1927 Report of the Secretary of
the Treasury, corporations are, relatively speaking, overtaxed, and
whichever theory be adopted as to the incidence of the corporation
income tax, it can hardly be denied that the way to give the greatest
Federal tax relief to the greatest numbers is through a reduction of
the corporation rate. The number of individuals contributing
directly to the support of the Federal Government through the
Federal income tax has been strictly limited, and, of those contributing, the vast majority pay but an insignificant amount and at a very
low rate. Of 2,434,000 individuals returning taxable income,
2,059,000 returned but $32,861,000 of income tax, while 375,000
individuals returned a tax of $1,109,000,000. . The average rate of
tax on the net incomes of the 2,059,000 individuals was 0.42 per cent,
whereas the millions of individuals who owned stock in corporations
were that year paying through the corporations 12 per cent on the
profits of the business enterprises in which they were shareholders.
For the calendar year 1927 all corporations reporting net income
reported a net income (including tax-exempt interest) before all taxes,
of $10,934,031,563. They paid, in taxes other than income tax,
$1,543,516,930, and reported income tax of $1,131,000,000, making a
total of $2,674,000,000. In other words, 24.46 per cent of their net
income was taken by taxes. In the same year these corporations paid
about $5,786,000,000 in cash dividends, which was 52.92 per cent of
their net income. For every dollar paid in dividends, 46 cents were
paid in taxes. If all corporations be included—that is to say, corporations reporting a deficit as well as those reporting net income—the
percentage of net income paid in taxes is 34.84 per cent.
In so far as the reduction of the income tax on the incomes of individuals is concerned, under our system of graduated surtaxes the
reduction of the normal rate is relatively of greater benefit to those
with small or moderate incomes than to those with larger incomes.
Income from dividends would receive no benefit, since dividends are
not subject to the normal tax, but those who receive dividends would
of course benefit from the reduction of the corporation tax rate.
26
REPORT ON THE FINANCES
The fact that the calendar year basis of taxing incomes does not
coincide with the fiscal year of the Government increases the difficulties of adjusting income tax receipts to Budget requirements,
A flexible uicome tax rate^is adapted to this situation. The income
tax receipts may be readily adjusted, up or down, either by increasing
or reducing the normal rate or by applying a percentage of surcharge
or discount to the amount of tax payable as computed under the
present law. Either method of flexibility may be introduced without
giving rise to administrative difficulties or in any way complicating
the income tax return. The percentage adjustment, however, involves the taxpayer in an additional computation, and to avoid this,
in the present juncture, the method of reducing the normal tax rate
has been preferred. If flexibility is to be adopted as a permanent
policy, however, it is possible that the percentage adjustment may
be found to be not only more equitable but more wholesome in its
general effect, and this alternative method of obtaining flexibility
should have the careful consideration of the Congress in any future
adjustments.
AVOIDANCE OF INTERNATIONAL DOUBLE TAXATION
Subjection to taxes in two or more coimtries constitutes a real
barrier to the expansion of international trade and investments.
Even before the World War, some European governments took measures to alleviate this double charge on their taxpayers, but the movement did not become general until after the war, when the cumulation
of high income tax rates often consumed most of the profits of international commerce, and estates spread over several countries almost
vanished after payment of their respective duties.
Great Britain, France, Germany, Italy, the Netherlands, and Sweden
are among the European countries that have been parties to one or
more of at least 18 agreements regarding direct taxes.
There have also been a number of .special agreements regarding
death and gift duties and other limited subjects. Practically all
important maritime countries have entered into arrangements for
the reciprocal exemption of shipping profits derived by nonresident
companies. The United States and various other countries effected
the last mentioned relief by means of legislation.
Unfortunately, there is a great diversity in the form and content
of these treaties, which is primarily due to the great difference in the
structure of the tax systems of the contracting States. With a view
to standardizing international agreements designed to eliminate
double taxation, experts of the League of Nations and the International Chamber of Commerce have been endeavoring for a number of
years to formulate a uniform method of relief susceptible of general
SECRETARY OF THE TREASURY
27
tase. In the first place, a theoretic study of double taxation was
prepared by four economists and published in March, 1923. A study
•^of the same problem from a practical and administrative viewpoint
was then elaborated by a committee consisting of officials high in the
•tax administrations of Belgium, Czechoslovakia, France, Great Britain,
Italy, Netherlands, and Switzerland, and published in February, 1925.
Later experts nominated by Argentina, Germany, Japan, Poland,
..•and Venezuela were added to the committee, and the American
'Government appointed Professor T. S. Adams to.attend its final meeti n g at London, April, 1927. This committee drafted two model conventions relating to the prevention of double taxation: (1) In the field
of income and property taxes; (2) in the field of death duties. I t
.also prepared two other model conventions intended to implement
"the former, regarding mutual assistance in the assessment and judicial
.^assistance in the collection of taxes.
The report of the London meeting embodying these drafts was
-submitted to the various governments, members and nonmembers of
the league for their consideration, and in October, 1928, 27 governanents sent experts to a Conference on Double Taxation at Geneva.
Professor T. S. Adams served as the American expert.
The conference took the London drafts as a basis for discussion,
'but finding the proposed model convention relative to income and
•property taxes not adaptable to the majority of the tax systems
represented,, it approved two alternative projects: The one offered
by Professor Adams and based on the reciprocal exemption and
•credit provisions contained in the United States revenue act; and the
other amalgamated from projects presented by the German expert,
-Doctor Dorn, and the French expert, Monsieur Borduge. The
ILondon drafts concerning death duties and administrative and judicial
:assistance were adopted with slight modifications.
These conventions are not in any way binding on the countries
Tepresented at the conference, but are merely offered for their
jguidance in making bilateral treaties for preventing double taxation.
Taking into account the nature of the various tax systems, the basic
principles of the model conventions drafted at the Geneva Confer"^nce, and the interests of the United States, the American section of
t h e International Chamber of Commerce drafted a uniform code of
principles for eliminating the double imposition of income, property,
^ n d estate taxes. This code was subsequently adopted by the Conigress of the International Chamber of Commerce (Amsterdam, July,
1929), which reciommends that States adopt, either unqualifiedly or
o n condition of reciprocity, the principles contained therein as the
simplest and most equitable to observe in revising their revenue legislation and in concluding international treaties.
28'
REPORT ON THE FINANCES
•
As double taxation impedes considerably the expansion of commerce, no country has a more vital interest in preventing it than the
United States. The United States has already incorporated in its
revenue act certain measures to prevent double taxation, but much
more can be done.
The Treasury Department proposes during the coming session of
Congress to submit its studies of the subject and its recommendations,
which will permit our Government to participate in the movement to
eliminate international double taxation.
INCOME TAX ADMINISTRATION
The survey by the Treasury of the administration of the Bureau of
Internal Revenue which was published in October, 1927, as Volume
I I I of the Report of the Joint Committee on Internal Revenue Taxation, was reviewed and brought down to date in the Secretary's annual
report for the fiscal year 1928 (pp. 35-44). I t is believed that it will
be of benefit to continue the study for the fiscal year 1929.
The work of the Bureau of Internal Revenue is now considered to
be upon a current basis. Substantial and encouraging progress is
being made toward relieving the congestion of cases accumulated
before the Board of Tax Appeals. The handling of cases in litigation
has improved satisfactorily. As previously pointed out, however,
the Treasury does not consider that the administration of the tax
laws is upon a current basis merely because the work M the Bureau
of Internal Revenue is current. From the Treasury point of view,
no tax case is settled until a final determination and adjustment of
theHax liability has been made and the case closed finally for all
purposes, even though a decision of the Board of Tax Appeals or of
the courts is necessary.
The following is presented to show the continued improvement
which has taken place during the past fiscal year:
Status of work
On September 28, 1928, there were 2,375 returns ^^open" for the
years 1917 to 1921, inclusive, the excess-profits tax years. Most of
these had been closed once by the bureau and reopened on the taxpayer's request. On September 30, 1929, this group had been reduced
to 1,477.
The number of cases pending on the latter date and awaiting
original audit were as follows:
1917
1918
1919
-
13
38
66
1920
1921
91
76
SECRETARY OF THE TREASURY
29
On September 28, 1928, the number of returns awaiting audit for
all years prior to 1926 had been reduced to 35,454, and for all years
prior to 1927 the total was 89,885. On September 30, 1929, the
number of cases for years prior to 1926 had been reduced to 13,227,
and for years prior to 1927, to 26,614.
On October 1, 1928, out of 2,321,368 returns for 1927 referred to
Washington, only 450,686 were pending for audit, 1,870,682 having
been completely audited and closed. Corresponding figures for 1928
show that to October 1, 1929, 2,458,416 returns for 1928 had been
forwarded to Washington and only 366,008 still awaited a final closing.
At the time of the survey there were 1,803 offers in compromise
pending and approximately 18,000 claims for refund. On October 1,
1924
DIAGRAM 7.—Number of appeals docketed, formal decisions rendered, and total number of appeals disposed
of by the Board of Tax Appeals, from July, 1924, to September, 1929
1928, these had been reduced to 1,449 offers in compromise and
approximately 13,287 claims. On October 1, 1929, there were 1,454
offers in compromise pending and 11,623 claims.
Cases pending before the Board qf Tax Appeals
The accumulation of cases before the Board of Tax Appeals has
been greatly reduced since the date of the last annual report. The
efforts of the bureau have been directed as heretofore toward (1) a
decrease in the number of new petitions; (2) an increase in the number
of cases settled through the special advisory committee; (3) an increase
in the number of settlements effected by the review division of the
general counsel's office; and (4) the settlement of appeals by other
divisions of the general counsel's office.
30
REPORT ON T H E FINANCES
The policy of the department with reference to the adjustment of
tax differences as an administrative matter rather than by litigation^
has been frequently set forth in previous reports and in other publicdocuments, including hearings before various committees of Congress,.
The application of these principles to the general run of cases ina
the Income Tax Unit has been so successful that a very large percentage of the cases in which the field organization was unable to reach an
agreement with the taxpayer has been adjusted by the unit in W a s h ington without the necessity of sending the so-called 60-day letterp,
which is the basis of an appeal to the Board of Tax Appeals. Thus, in^
the 52 weeks ending June 29, 1929, 15,322 cases were considered in theunit after the examining agent and the taxpayer had failed to reach
an agreement. Of these cases 12,946, or 84.5 per cent, were adjusted
without the issuance of the 60-day letter. In other words, in 84.5 p e r
cent of these cases the unit was able to reach an agreement with t h ^
taxpayer which obviated the necessity of issuing such a letter, thereby
very greatly reducing the number of appeals to the Board of Tax:
Appeals. As a result, during the past fiscal year, only 5,458 appeals
were filed with the board as contrasted with 10,165 for the previous
fiscal year, a decrease of 4,707, or 46.3 per cent.
During this period, however, the unit has found it impossible tO'
settle many of the larger cases. This is indicated by the fact that of
the amount of tax involved in the 15,322 cases referred to above, the?
settlements, which were 84.5 per cent of the total number, involved
only 41.4 per cent of the total amount of tax in dispute. This is u n questionably because in many of the larger cases the taxpayers feeE
t h a t litigation is worth while, and in some cases because litigation isdoubtless encouraged by the taxpayers' representative in view of the^
larger fees possible if the outcome is successful for the client.
The work of the special advisory committee, described in theprevious report (p. 37), has continued very successfully throughout
the past fiscal year. The committee has effected a settlement in 4 , 4 i r
pending appeals and has adjusted 807 cases in which 60-day letters^
had been issued and before the taxpayer had filed an appeal. Fifty
miscellaneous cases were also disposed of. On the appeal casessettled, the deficiencies recomputed totaled $31,175,229.69 and on.
the 60-day cases $3,717,275.13, thus making immediately available,,
as soon as the necessary stipulations and orders of the board were^
entered, a total of $34,892,504.82. These amounts helped to swelL
substantially the total collections of back taxes. During the fiscal
year the Board of Tax Appeals decided 1,108 of the cases, in which thecommittee had recommended that a settlement be not effected a n d
that the case be defended before the board, and of the total deficiencies claimed by the department of $10,254,173.31, the board found
$8,746,166.31, or 85.3 per cent, in favor of the Government.
SECRETARY OF T H E TREASURY
31
The work of the review division, effected with a smaller personnel,
has also been important and successful. This division has considered
1,791 cases, of which 1,073, or 71 per cent, were recommended for
settlement. A large number of the cases considered by the review
division were settled in favor of the taxpayers by reason of final
court decisions reversing the position originally taken by the bureau,
or by reason of retroactive legislation. The policy has been to dispose of as many of these cases as possible during the current year,
in order that the docket may eventually represent only those cases in
which the department has determined that litigation is necessary.
Of the cases on which the review division recommended defense, 85
have been decided by the board, and the final orders gave the bureau
a decision of 66.7 per cent of the total deficiencies claimed.
DIAGRAM 8.
1925
1929
-Output of the Board of Tax Appeals, the special advisory committee, and the review
division of the general counsel's office
In other divisions of the general counsel's office the same principles
underlying the settlement of the cases above referred to have been
applied consistently and a number of these cases have produced
substantial amounts of revenue.
If we look at the results of the settlement policy solely in terms of
additional tax made immediately available, we have the following
figures:
Cases closed in the unit
. —- $29, 511, 131. 53
Cases closed in special advisory committee
34, 819, 000. 00
Cases closed in review division
8, 766, 634. 31
Cases closed in other divisions of general counsel's office
(estimated)
_->._. iO, 000^ 000. 00
Total
.-„
---
83, 096, 765. 84
32
REPORT ON T H E FINANCES
These figures do not include the results of thousands of similar
cases settled by the field units. While not all of the above assessments
have been actually collected within the taxable year, since a certain
period is required for assessment and payment in those cases closed in
the latter part of the fiscal year, it is evident that a very substantial
part of the back tax collections for the fiscal year, which totaled
approximately $237,000,000, was due to the continued application
and extension of the settlement policy throughout the bureau.
I t should again be emphasized that these powers of settlement are
not delegated to single representatives of the bureau, but are entrusted
only to those who by experience and training have been found most
fitted to exercise them. Every decision is subject to careful review
and approval by several superior officers of the bureau before it
becomes binding upon the Government. Thus every settlement
effected by the special advisory committee is virtually the concurrent
action of all of the members of the comrnittee acting upon the recommendation of one or more conferees, and the committee's action is
carefully reviewed by expert technical assistants to the commissioner
before being submitted to him for his consideration and approval.
Similarly a settlement effected by the review division must be approved by two or more attornej^s before being submitted to the chief
of the division, who personally examines the case in detail and
approves it before submitting it to the general counsel for his consideration and approval, after which it must also be forwarded to
the commissioner's office for further consideration and approval by
the commissioner and his immediate staff.
As a result of the work of these agencies the disposals of cases
pending in the Board of Tax Appeals have in each month of the fiscal
year exceeded the number of new appeals filed. During the fiscal
year the disposals totaled 8,969 as compared with 7,070 for the
previous fiscal year, a gain of 1,899. Since the number of new
appeals decreased by 4,707, the gain on accumulated work made by
the board was 6,606 cases over that of the previous year.
The figures by months for appeals docketed and cases disposed of
are shown in diagram 7, page 29, and by the following table:
1927
1929
1928
Month
Docketed
January
February
March
April
May
June
July.........
August
September
October
November
December
. _
_ .
.
_
_ .
.....^.........
:.
:
:.
_.
1,125
1,408
1,038
1,993
•1,050
525
645
889
621
522
496
897
Disposals
378
471
572
511
• 419
506
283
328
407
521
515
574
Docketed
993
1,562
881
1,113
1,006
540
444
478
333.
430
425
465
Disposals
539
621
828
745
764
965
616
591
628
948
763
648
Docketed
350
500
398.
581
• 786
. 268
257
279
321
Dis-.
posals
690"
797
949
841
809
689
698
486
582
33
SECRETARY OF THE TREASUEY
While the number of cases pending in the Board of Tax Appeals
has decreased from 21,639 on June 30, 1928, to 18,301 on June 30,
1929, a reduction of 3,338, or 15.4 per cent, the reduction in amounts
involved in pending cases has not been as great. The amount
involved in pending cases on June 30, 1928, was $697,366,559, and
on June 30, 1929, $650,000,425, a reduction of $47,368,134, or 6.8
per cent. I t is interesting to note that most of the appeals filed,
both in number and in amount, during the last fiscal year have been
on recent tax years, principally 1924, 1925, and 1926. This indicates
that the field of possible litigation has not disappeared, as some had
anticipated, with the closing out of the excess profits cases. Also
it should be noted that the average amount involved in the new
appeals is as great as the amount involved in the cases disposed of
during the same period. The average amount involved in the 5,458
appeals filed in the fiscal year was $34,275.92, and the average
amount involved in the 8,969 cases disposed of during the year on
the basis of deficiencies claimed by the commissioner was $25,337.02.
In summary, the Treasury believes that the problem of the accumulation confronting the bureau and the Board of Tax Appeals has
been solved, and that a continuation of the agencies and policies
which have been so effective during the past fiscal year will bring
the Board of Tax Appeals to a current basis by the end of the fiscal
year 1931, if not earlier—an achievement which two years ago would
have been deemed exceedingly doubtful, if not impossible.
Final agreements
The report for the previous fiscal year showed a steady increase
in the number of final closing agreements under section 1106(b) of
the revenue act of 1926, the authority for which is continued with
greater flexibility in section 606 of the revenue act of 1928. We
believe it is greatly to the advantage of both the Government and
the taxpayer to encourage the filing of such agreements and the
efforts along this line have been exceedingly fruitful. In the first
six months of this calendar year these agreements numbered 85,085,
and for the entire fiscal year 117,852, as against 5,309 in the preceding fiscal year. Monthly figures for the last three calendar
years are as follows:
Month
1927
January
February
March». _ __
April
May
June..
1928
1929
425
573
820
466
985
1,487
16,408
18,122
15, 536
13,439
12,110
9,670
71799--30—F] 1 9 2 9 -— 5
Month
July
August
September
October
November
December
1927
_
1928
20
78
33 1,441
82 2,819
73 4,897
187 12,164
158 ,11,368
1929
8,843
10, 204
5,588
34
REPORT ON THE FINANCES
The presentation of such an agreement for execution by the department does not result in any reexamuiation of the case. If the
case has been closed and all known issues finally determined, the
proposed agreement is approved and executed. Section 606 of the
revenue act of 1928 also allows the execution of such agreements
with reference to one or more issues in a tax case, and in appropriate cases such agreements have been executed.
CoUection from transferees
Section 280 of the revenue act of 1926 and section 311 of the
revenue act of 1928 have been very effective in preventing tax
evasion by the transfer of property to other persons. Although
complete statistics are not available, actual collections under the provisions of these sections from the date of the enactment of the 1926
act to the end of this fiscal year are in excess of $7,250,000, and in
addition there are assessments or amounts proposed for assessment
pending before the iBoard of Tax Appeals and totaling over $116,000,000. To some extent this latter figure involves a duplication of
claims for the same tax against a group of transferees, but it is apparent that a very substantial amount will be collected as a result of
these proceedings. Prior to the estabhshment of this procedure
under section 280 of the 1926 act and section 311 of the 1928 act,
the only recourse in such cases was by proceedings in equity. Less
than $500,000 was collected as a result of such equity proceedings
out of a total of practically $25,000,000 involved in such proceedings.
Reopening oj cases
While in general the policy of the bureau continues to be against
the reopening of cases once decided, there are certain cases where
such reconsideration is requested for the purpose of further argument,
production of additional evidence, reconsideration in view of subsequent court or board decisions or in view of adjustments made in
prior or subsequent year returns, and for other reasons. Certain of
these applications are granted but no case is reopened for consideration until a careful review indicates that such reopening would result
in a reduction of the tax. Each case is treated upon its individual
merits by a special group. The following figures indicate the volume
of this work in the last fiscal year:
Requests for reopening on hand July 1, 1928
Total requests for reopening received
458
4, 079
1
4,537
Requests, initiated by taxpaj^er, denied
Requests, initiated by taxpayer, allowed
Requests, initiated by unit, denied__-_-
1,803
1, 257
73
SECRETARY OF THE TREASURY
Requests, referred to Special advisory committee for action
Requests, initiated by unit, allowed
35
34
285
Total requests for reopening considered—
3, 452
Active requests on hand, July 1, 1929
1, 085
Personnel
In spite of substantial increases in certain salaries during the past
two years the bureau continues to lose from time to time some of its
most valuable employees. While it can never compete in salaries
with large corporations for attorneys or tax accountants, it is beheved
that reasonable increases should be made from time to time to retain
the men who are especially valuable. Payment of higher salaries to
an increased number of men in the most responsible positions in the
general counsel's office, as well as in the unit and field organizations,
is justified because it not only retains these men for a longer period in
the Government service but also acts as an incentive to those in the
lower grades.
Refunds and credits
Section 710 of the revenue act of 1928 requires that all refunds and
credits in excess of $75,000 shall be reported to the Joint Congressional
Committee on Internal Revenue Taxation. There is also a provision
in the urgent deficiency bill (H. R. 15848) signed March 4, 1929,
which requires that none of the money therein appropriated for
refunds shall be used therefor unless a hearing has been held, except
in cases, in which a suit in court or proceedings before the Board of
Tax Appeals has been or shall be instituted, and except payments in
cases determined upon precedents established in decisions of courts
and of the Board of Tax Appeals. This provision also required that
decisions in such cases shall be public records.
Inasmuch as practically every refund of a substantial amount
depends upon decisions in one or more cases in the courts or Board
of Tax Appeals, this provision would have had virtually no effect if
it had been construed literally by the department. However, believing that Congress had by its enactment indicated clearly a desire that
a certain amount of publicity should be given to the larger tax refunds
and believing that such publication for at least a certain period would
clear the air of many misconceptions with regard thereto, the department on its own initiative on March 14, 1929, proposed to the President for approval regulations authorizing the pubhcation of refund
decisions in every case in which an overassessment of income, war
profits, excess profits, estate or gift taxes in excess of $20,000 is allowed.
The details are set forth in Treasury Decision No. 3856.
36
REPORT ON THE FINANCES
At the time that this proposal was approved by the President the
Treasury issued the following statement explaining its position:
It has been the consistent policy of the Treasury, a policy determined upon
only after careful consideration and as to which ample opportunities have been
offered repeatedly for reconsideration, that tax returns, and the information
thereon, should under no circumstances be open to public inspection. This policy
is based upon the principle that taxpayers should be permitted to contribute their
share of the revenue necessities of the Goverment without subjecting their
business affairs and transactions to the scrutiny of their competitors, the idly
curious, solicitors of contributions, and unscrupulous tax practitioners seeking
out possible future clients. This policy is not affected by the Executive' order.
The regulations specifically provide that neither the return, nor anj^ part thereof,
shall be open to inspection, and in addition the publication of the source of any
income, gains, or profits, or transactions resulting in losses or expenditures, is
specifically prohibited.
The Congress adopted, as an amendment to the first deficiency appropriation
act, a provision which, as a matter of legal interpretation, would probably
require no material change in the procedure or practice of the Bureau of Internal
Revenue. Furthermore, whatever effect might have been intended was, of
course, limited to the specific appropriations made by that act, and would not be
applicable to any of the other appropriations available for making refunds.
The Treasury has entered serious objections to all so-called ''publicity"
proposals. The soundness of this position is reiterated. However, in an effort
to dispel any misunderstanding that might have arisen in the minds of the public
because of the recent discussions of the matter, the Treasury has undertaken to
go much further than the amendment requires. It is believed that the publication of the decisions in the manner outlined above will, in a very short
period of time, show conclusively that the Treasury has nothing to hide in
the matter of tax refunds; that there is nothing mysterious about tax
refunds; that practically all refunds, credits, and abatements which are
allow^ed are attributable directly to such cau^^es as decisions of the courts or of
the Board of Tax Appeals, overturning the Treasury position or holding a provision of the statute unconstitutional, to retroactive legislation, to uncertainties,
ambiguities, or omissions in the statute, to mathematical error, to factors which
could not have been determined at the time the tax was paid, or to the publicspirited attitude of taxpayers in deciding doubtful questions against themselves
at the time the tax is paid, relying upon a proper administrative policy in reaching
a final determination of the amount properly due; and that the refunding of
overpayments of taxes is merely a necessary part of the administration of our
tax laws—in fact, an essential corollary of any tax system founded upon the
''payment first" principle so frequently discussed. It must not be forgotten
that our Federal tax collection system is founded upon the doctrine that taxpayers may be compelled to p&y the amount Government officials determine to
be due, with no opportunity until after payment for a review of that determination. It is vital, and the interests of taxpayers and the public generally
properly demand as a necessary protection that when that review is afforded,
whether it be administrative or judicial, the decision be carried out without
undue delay.
Under this Treasury decision there have been published 175
decisions involving such refunds. The immediate effect of the
establishment of this procedure was to delay the closing of many
refund cases until the work was organized. This reduced the refunds
SECRETAR.Y OF THE TREASURY
37
in the fiscal year, but does not reduce the ultimate amount to be
refunded, since in the end these amounts will be paid, with additional
interest for the period of delay. In fact, the procedure involves
obviously some delay in every refund case and to this extent increases
the interest payable upon the amount refunded. In addition, the
preparation of the decisions foT publication requires the time of
several employees who had previously been engaged upon other work.
Nevertheless, it is believed that the adoption of the policy has been
worth while.
A report on this subject has recently been published by the Joint
Committee on Internal Revenue Taxation (H. Doc. 43, 71st Cong.,
1st sess.). In this report Mr. L. H. Parkei, Chief of the Division of
Investigation, states to the committee (Page V I I I ) :
In regard to the individual refunds it appears that on the whole the action of
the commissioner in making these allowances shows proper, just, and careful
handling in the face of many difficulties. A few cases have appeared doubtful
and a difference of opinion resulted. This is recognized as being inevitable in
view of the complexity and uncertainty of certain provisions of our revenue acts.
I t should be recognized that the great majority of refunds are
caused either by court or board decisions, by clerical or bookkeeping
adjustments, or by causes beyond the control of either the Treasury
or the taxpayer; that is, to adjustments after payment of the tax,
based upon causes which could not fairly be considered prior to the
payment. An analysis of all over-assessment cases submitted to
the joint committee up to January, 1929, totaling 652, showed that
85.2 per cent of the amounts refunded or credited were due to such
causes. (See pp. 29 to 44 of Report of Joint Committee on Internal
Revenue Taxation.)
0
Future work
The survey published in October, 1927, is kept current by thorough
studies of the important technical and administrative problems
as they arise. In this way, the problems come more immediately
to the attention of the higher officials. I t is believed that, as a result,
.many difficulties will be avoided, that action will be taken and
sound solutions determined upon more promptly, and that economies
will be effected. Some of the most important matters now under
consideration are the problems involved in valuations, depreciation,
and depletion, and in the application and effect of the provisions
relating to the basis of property and to reorganizations. Among
the other matters to which the Treasury is giving serious consideration
are (1) a more effective supervision of the work of the field organization
before it is forwarded to Washington for approval; (2) atmore effective
trial before the Board of Tax Appeals of those cases in which litigation is necessary; (3) the inclusion in the individual income tax
38
REPORT ON THE FINANCES
return of a closing agreement form wliich may be executed by the
taxpayer at the time he files his return and, if examination justifies,
approved by the commissioner and the secretary within a reasonable
time thereafter; and (4) the adoption of a proper procedure, sometime
in the future, under which anticipatory or advisory rulings may be
given as to tax liabilities resulting from transactions completed,
or about to be effected, in advance of the filing of a return. This
proposal has been presented to the department repeatedly. I t
would be of the utmost benefit and value to taxpayers to know in
advance the effect of a proposed transaction upon income tax
liabilities. The lack of a sufficiently experienced personnel equipped
to render opinions promptly and the volume of other more important
work have heretofore prevented favorable action. Every effort
is being made to analyze and determine the soundness of suggestions
and proposals looking toward an improvement in the administration,
and to put into effect those ultimately determined upon.
Conclusions
I t is believed that most of the major problems brought out by the
survey of October, 1927, have been solved in large part. The
Bureau of Internal Revenue is upon a current basis, and the congestion of cases before the Board of Tax Appeals has been materially
relieved. Opportunities for further improvements remain and
minor difficulties are, of course, constantly arising. The problem
of maintaining an experienced and efficient personnel possessed of
ability adequate to represent the Government and at the same time
to appreciate the taxpayers' position, has as yet not been solved
completely. The experience of the past two years has demonstrated
the soundness of the Treasury's settlement policy^ and a continued
application and proper extension of the policy is expected. Income
tax liabilities can and must be finally settled administratively,
rather than through litigation. Judicial agencies are not equipped
and judicial procedure is not designed to handle the vast volume of
tax cases and the exceptionally technical questions involved. Administrative determination and settlement are not only to the advantage,
of both the Government and the taxpayer, but are essential if the
income tax is to be retained as a part of our revenue system.
TREASURY BILLS
On June 17, 1929, the President approved H. R. 1648, an amendment
to the second Liberty bond act, authorizing the Secretary of the
Treasury tp issue from time to time Treasury bills on a discount
basis with maturities not exceeding 12 months, to be sold for cash
under competitive conditions at the lowest rates or highest prices bid
by prospective purchasers. This provides a new type of short-term
SECRETARY OF THE TREASURY
39
Government security. Previously the second Liberty bond act had
authorized a short-term security in the form of the Treasury certificate of indebtedness to be issued at not less than par, with maturities
not exceeding one year, at coupon rates fixed by the Treasury.
The method of short-term financing through the issue of certificates
of indebtedness, which also includes a Government depositary system,
was a war-time development. Certificates of indebtedness were not
a new form of security, but in order to obtain the sums needed during
the war it was necessary to issue these securities in large quantities
in anticipation of loans and of tax receipts and to devise a plan which
would encourage a widespread participation of banks in all new issues.
The Treasury, with the aid of the Federal reserve system, therefore
inaugurated a program whereby a large number of banks throughout
the country were able to qualify as Government depositaries, and
such banks, in subscribing to new issues, could make payments for
the securities allotted to them not in cash but in book credits—deposits
established to the credit of the Government.
Although adopted as a war measure, the plan has continued to
function successfully during the postwar period of debt reduction.
The largest payinents of income taxes, the backbone of our Federal
revenue, are received on the 15th of March, June, September, and
December of each year. Maturities of certificates are made to fall
on these dates in an amount approximately equal to anticipated tax
receipts. New certificates are issued to cover the needs of the
Treasury during the ensuing quarter and to refund part of the maturing debt if desired. The system of Treasury certificate maturities
and sales on quarterly dates, and payment by deposit credit; serves
the following purposes: First, it maintains a part of the outstanding
war debt in the form of short-term securities, which, on the whole,
has been advantageous from the standpoint of reducing interest
charges; second, it provides the necessary funds to meet the current
obligations of the Government; third, since the maturities of the
.certfficates coincide with the period during which heavy tax payments are received, and since new certfficates are paid for by deposit
credit and not cash, ari effective system has been provided for preventing heavy withdrawal of funds from the money market with
consequent ^serious disturbance; fourth, it makes the selection of the
depositary and the amount of Government deposits in any one bank
depend not upon the discretion of the Secretary of the Treasury but
upon the amounts of the several subscriptions of the qualifying
banks; fifth, it furnishes the Government with a first-class primary
market for its securities and with the. machinery through which a"
secondary distribution can be effected.
40
REPORT ON T H E FINANCES
The system just described is excellent so far as it goes, but it does
not cover the situation in the most economical and effective way under
all circumstances. It falls short in the following particulars:
1. The practice of the Treasury of borrowing, on quarterly tax
dates, amounts sufficient to provide for the excess of the ordinary
expenditures over the receipts of the Government during the following
quarter, naturally results in the carrying of large deposits over
considerable periods of time. This means that until the Government
has actual use for the funds borrowed it loses the difference between
the coupon rate of the securities issued and the 2 per cent which it
receives from the banks on its deposits.
2. While the maturing of certificates synchronizes in general with
the collection of income taxes, as a matter of fact these certfficates
are for the most part presented for redemption on the due date,
whereas the collection of income tax checks is spread over a period of
some days. As a result. Treasury disbursements exceed receipts
during every income tax payment period, and the Treasury is obliged
to borrow temporarily from the Federal reserve banks and to pay
interest on this temporary borrowing in addition to the interest on
the newly issued securities.
3. Since certificates are issued bearing a fixed coupon rate, the
Treasury Department is confronted with the dtSScult task of accurately
adjusting the interest rate to current market conditions.
4. The issue of securities on certain fixed dates lacks that flexibility
which is desirable to enable the Treasury to take advantage of favorable money conditions.
5. Banks subscribe for Treasury certfficates mainly because of the
deposit privilege. A bank can generally afford to subscribe for these
certiflcates and sell them immediately after or even previous to their
issue at a discount, to the detrimenlbof the Government credit.
In view of these deficiencies in the certificate-deposit system, it
seemed desirable to the Treasury that, in certain circumstances, a
more economical and more flexible type of short-term security should
be available which could be adjusted more exactly to the requirements of the Treasury and to current money market conditions.
Accordingly, steps were taken by the Treasury to secure legislation
supplementing the authority to issue certfficates of indebtedness.
The act approved June 17, 1929, authorizing the sale of Treasury
bills for cash on a discount basis was the result.
Treasury-bill financing differs from certificate-deposit financing in
the following particulars: '
1. The fixing of the price a,nd of the discount rate through competitive bidding rather than sale at par with the interest rate fixed
by the Treasury.
SECRETARY OF THE TREASURY
41
2. Discount paid in advance rather than interest paid at intervals
during the life of the security.
3. The proceeds to be received in cash rather than mainly in deposit
credit at depositary banks.
Several important advantages may be expected to follow the use
of the new form of short-term financing: First, competitive bidding
for these bills should enable the Treasury to realize the lowest discount rates consistent with inarket conditions; second, the sale of
these securities can be timed to coincide almost exactly with the
need for funds, thus saving the interest on money borrowed ahead of
requirements; third, maturities can be timed to correspond closely
to the actual collection of income taxes instead of all falling on the
nominal date of tax payments; fourth, the Treasury will be able to
take advantage of periods of seasonal ease for short-term borrowing
instead of being compelled, as has sometimes occurred in the past,
to offer a large issue of securities during a period of temporary stringency and high money rates; fifth, since the discount rate is fixed by
the market, and the bills are bought for cash by those who mean
either to hold them as investments or for secondary distribution,
they wffi not tend immediately to fall below issue price to the detriment of Government credit; sixth, the banks and the investing
public will be filrnished with a new instrument for the investing of
temporary surplus funds with frequent and convenient maturities.
I t should be pointed out that while this is a new type of security
to the United States Government, there is nothing novel in the form,
since it corresponds closely to one of the oldest and best established
types of commercial paper, the bankers' bill. The Treasury bill has
been used for many years by the British Treasury as a most convenient and economical medium to obtain funds to meet current
needs. The British Treasury has so developed the system of financing by means of treasury bills that with weekly oft'erings, daily issues,
ajid daily maturities it has obtained a degree of flexibility that
enables it to adjust its cash position practically from day to day.
I t is not the purpose of the United States Treasury to replace the
old system but rather to continue the issue of certfficates of indebtedness for its regular short-term financing, supplementing with
the issue of small amounts of Treasury bills when the need for funds
between quarterly dates arises and the condition of the money market
is propitious. No use has yet been made of the new authorization.
TAX EXEMPTION OF FEDERAL SECURITIES'
In the act of June 17, 1929, Congress also modffied the second
Liberty bond act, as amended, by providing that all certfficateS' of
indebtedness and Treasury bills issued thereafter and thereunder
should be exempt both as to principal and interest from all taxation
42
REPORT ON THE FINANCES
except estate and inheritance taxes. As applied to the Treasury
bills, interest is to be considered as the amount of discount for which
the bills were originally issued. Any gain in excess of this is taxable
income and any loss may be taken as a deduction from taxable
income. Previous to the passage of this act certificates of indebtedness had been exempt from normal income taxes and only to a
limited extent from surtaxes. This exemption from surtaxes does
not change the tax status of these securities to banks and other corporations, since surtaxes apply only to individuals. The change is
important for individuals, whose incomes are subject to surtaxes,
and the altered attitude of this class toward the certfficates as an
investment seems to have been indicated by the large subscription
to the September 16th issue of certificates, the first issue to come
under the tax-free provision of the act of June 17, 1929. While the
effort to secure the allotments desired may have led to some oversubscription to this issue, the unusual size of the subscriptions, amounting
to almost three times the allotments, indicated a greater diffusion
than previous issues have shown. It is the belief of the Treasury
that a wider holding of certificates is generally desirable and tends
to result in higher quotations on these securities.
The act of June 17, 1929, with its provisions for a much wider exemption from taxation for certificates of indebtedness and Treasury
bills issued by the Federal Government, gives to the Treasury Department an advantage in marketing these securities equal to that
enjoyed by State governments and their political subdivisions. So
long as State and local governments continue to issue wholly taxexempt securities in an amount that is increasing at the rate of about
a billion dollars a year, the Federal Government is justly entitled to
issue securities which enjoy the same degree of tax exemption. Ultimately a constitutional amendment may be adopted permitting
Federal and State governments each to tax the securities issued by
the other.
ISSUE OF NEW SMALL-SIZE CURRENCY
Revision of the paper currency designs, with reduction in the size
of the currency, has been discussed in reports for several past years.
On May 26, 1927,1 announced that I had approved the recommendations submitted for a reduction in the size of |;he paper currency, with
revision of the designs, and that the Director of the Bureau of Engraving and Printing had been ordered to proceed with the preliminary
arrangements for production of the new notes. This involved not
only the preparation of iiew designs and the engraving of new plates,
but also the installation of new or the alteration of certain of the old
equipment in the Bureau of Engraving and Printing. In my annual
report for 1928, announcement was made that this work was advanc
SECRETAR.Y OF THE TREASURY
43
ing with a view to the issue of the new currency on or about July 1,
1929. That report also contained a description of the reduced-size
currency and the designs adopted.
On November 16, 1928, I announced that July, 1929, had been
fixed for the time of the initial issue and that all kinds of currency,
except national-bank notes, and all denominations from $1 to $20
would be included in the initial issue. It was further announced
that issues of old-size United States currency by the Treasury would
cease about April 30, 1929, and that thereafter for two months the
currency demands would be met by the Federal reserve banks from
their stock of new or circulated old-size currency.
On June 3, 1929, there was issued Department Circular 415, together with a statement (Exhibit 30, p. 330), fixing July 10, 1929, as
the date for the initial issue of new small-size currency and staling
that thereafter old-size currency redeemed as unfit for further circulation would be replaced with new small-size currency. The Federal
reserve banks and branches were authorized to make available on
that date to the commercial banking institutions of their respective
districts limited amounts of new small-size currency on an equitable
basis estabhshed by them, and after such initial issue to pay out newsize currency in replacement of old size retired as unfit. The initial issue
included denominations from $1 to $20 for all kinds of currency except national-bank notes. Denomirations above $20 for gold certificates and Federal reserve notes were issued when available without
further notice. In order to obviate any questions as to the validity
of the old large-size paper money. Circular No. 415 concluded as
follows:
Any outstanding old-size paper currency, heretofore or hereafter issued, will
not be recalled. It will be retired gradually in. regular course qf business, and in
the meantime its validity will not be affected by issue of the new small-size
currency.
In order that the public might become famihar with the new currency prior to its issue, the Federal reserve banks were authorized
to offer to all incorporated banks and trust companies in their districts exhibition sets of the new currency consisting of four pieces:
$1 silver certificate, $2 United States note, and $5 and $10 Federal
reserve notes of the particular Federal reserve bank. One set only
was furnished each bank with an additional set for each established
branch. These exhibition sets were made available to banks and
trust companies on June 3, 1929, the date on which the circular
authorizing the initial issue and the accompanying statement were
made pubhc. On July 6, 1929, Undersecretary Mills delivered a
radio address through a chain of stations describing the new smallsize currency and the method by which the distribution would be
44
REPORT ON THE FINANCES
made. These various forms of publicity prepared the pubhc for the
change, and on Julyj.0,1929, when the new currency became available
throughout the country, the beginning of the exchange of the largesize currency for the small size passed without untoward incident.
As notes of the large size, unfit for further circulation, are presented
to a Federal reserve bank or branch thereof, they are replaced by the
small size, and at an early date all large-size currency will have been
retired.
A distinct problem was presented in connection with issuing smallsize national-bank notes. In my annual report for the last fiscal year
I stated that the question of the retirement of the 2 per cent consols
of 1930, upon which most of the national-bank currency is secured,
would be submitted to Congress before April 1, 1930. Retirement
of the consols held as security for national-bank notes would, under
the law, automatically retire the notes so secured. On January 21,
1929, however, I addressed identical letters to the President of the
Senate and the Speaker of the House of Representatives (Exhibit
28, p. 324), stating in part " I have concluded that it would be inadvisable to submit to Congress at this time a program looking to the
early retirement of our national-bank note circulation. Accordingly,
when the new-size paper currency is issued, on or about July 1, 1929,
the Treasury Department will be prepared shortly thereafter to make
available national-bank notes in the reduced size." Appreciating the
fact that national-bank notes would be at a distinct disadvantage if
continued in the large size after all other kinds of currency had been
issued in the new small size, the department took immediate steps for
including them in the general program for reduction in size and
revision of designs. The situation presented many perplexing difficulties of d e s i ^ and production, as it was necessary to provide new
small-size notes separately for over 6,000 issuing banks, involving a
separate printing job for each bank. On June 3, 1929, I a/d dressed a
letter to the president of each national bank (Exhibit 31, p. 333)
advising him that actual printing of small-size national-bank notes
would commence about July 15, and that the first of these notes
would be issued before the end of that month. I t was further stated
that the printing and issuing would proceed in the order of charter
numbers. The printing of some new small-size notes for all banks
was completed November 1, 1929.
The only available means for replacing the outstanding large-size
national-bank currency with the new small-size currency is through
the established redemption procedure. This involves (1) redemption
•of outstanding notes by the Treasurer of the United States, (2) assortment of the redeemed notes to the bank of issue, (3) charging the
redeemed notes of a particular bank to its 5 per cent redemption fund
on deposit with the Treasurer, (4) reimbursement of the 5 per cent
SECRETAR.Y OF THE TREASURY
45
fund by the banks to which redeemed notes have been charged, and
(5) issuing a corresponding amount of new notes to those banks:
Even in the most favorable circumstances this is a slow process. As
the new small-size notes have become available for a particular bank
they have been issued in replacement of redeemed notes. As soon
as small-size notes became available to all banks, the forces in the
offices of the Treasm^er of the United States and the Comptroller of
the Currency engaged in the redemption and issue of national-bank
notes were largely increased. A partial assortment of notes sent in
for redemption is now made by the Federal reserve banks. These
increased facilities enable the department to handle several times the
usual amount of daily redemptions and issues, and at a comparatively
0 early date the exchange of the large-size national-bank notes for the
new small-size notes will have been completed. A further complication has arisen from the fact that, with a substantial increase in redemptions, the 5 per cent fund is inadequate to cover the Treasurer
unless immediate reimbursements are made by national banks. Accordingly, during the period of increased redemptions, as large-size
notes are redeemed for issuing banks, the appropriate Federalreserve bank is advised and instructed to charge the reserve account
of the national bank concerned for reimbursement of the 5 per cent
fund with immediate credit to the Treasurer of the United States, and'
new small-size notes are thereupon issued to the bank concerned.
The replacement of all paper currency outstanding with currency
of the small size has involved a total of approximately $5,000,000,000
and nearly 900,000,000 pieces. Manifestly, neither the Treasury
Department nor the Federal reserve banks could undertake to make
the whole exchange at one time. Furthermore, a large part of the
old-size currency outstanding was fit for further circulation, and it
would have been a waste generally to cancel and redeem such fit
currency.
The retirement of all currency of the large size affords an opportunity to obtain information as to the approximate amount of currency which has disappeared and will never be presented for redemption. An investigation of the note issues of liquidated national banks
indicates that the amount of currency lost is usually overestimated..
To verify such estimates. Department Circular No. 416 (Exhibit 32',,
p. 335) was issued July 1, 1929, requiring that, in all accounts, records-,,
or statistics now or hereafter established by the Department with
respect to any paper currency issues of the United States, a separation,
shall be made as between the old-size and the reduced-size currency,
OBLIGATIONS OF FOREIGN GOVERNMENTS
During the fiscal year 1929, the Treasury received from foreign
governments on account of their indebtedness to the United States,
the sum of $199,131,568.90, of which $38,790,660.67 was for account
46
REPORT ON T H E FINANCES
of principal and $160,340,908.23 for account of interest. Additional
payments have been received between the close of the fiscal year
and November 15, 1929, aggregating $10,652,868.63, of which
$10,183,528.63 was for interest due on the obligations given by
France for surplus war materials purchased on credit, $226,000 was
for priTicipal and $243,340 for interest due on account of the funded
indebtedness of Greece.
Substantially all of the total amount of payments received from
foreign governments during the fiscal year was made in obligations
of the United States Government issued since April 6, 1917, in
accordance with the options granted under the various funding
agreements. The obligations tendered in payment of the amounts
due were accepted at par and accrued interest, if any, to the date of
payment, as authorized by the acts of Congress approving the
respective settlements. The foreign governments taking advantage
of the option to pay in obligations of the United States were Belgium,
Czechoslovalda, Estonia, Finland, Great Britain, Italy, and Poland.
The statement below shows the total payments received on account
of principal due under the funding agreements up to the end of the
fiscal year:
In United States obligations
Cash
Country
Accrued interest to date
of payment
Face amount
•
$6, 342,900.00
2,982,150.00
96,350.00
146,733, 550.00
$57,057.19
17,415,68
603.11
230,726.38
9,956,600.00
43,370. 25
Rumania.
YuEoslavia
$4,200,042.81
9,000,434. 32
191,046.89
35, 723. 62
40,000.00
50,995. 50
10,000,029. 75
160, 790. 50
1,400,000. 00
800, 000. 00
Total
25,879, 063. 39
165, 111, 550.00
349,172. 61
Belgium
Czechoslovakia
Finland
Great Britain
Greece
Hunerarv
itaif
^
_
:"::::"":::::::::::::::::::::
Total principal
payments
$9,600,000.00
12,000,000.00
288,000.00
147,000,000.00
40,000.00
50,995. 50
20, 000, 000. 00
160,790. 50
1, 400,000.00
800,000.00
191,339,786 00
The following statement shows the total payments received on
account of interest due under the funding agreements up to the end
of the fiscal year:
In United States obligations
Country
Belgium
Estonia
Finland
Oreat Britain
TTnnfarv
Latvia
Lithuania
Poland .
-Total
In bonds of
debtor
governments
$43,555.60
402,465.00
446,020.60
Cash
Face amount
Total interest
payments, inAccrued inter- cluding interest
est to date of
funded
payment
$4,865,101.49
450,015.87
1,312, 512.85
49,761,419.84
278, 506. 52
255,000.00
517,043.80
7,000,013. 06
^$3,589,050.00
123,900.00
415,650.00
831,289,300.00
$35,848.61
1,084.13
1,697.15
3,124,280.16
1,495, 650.00
4,336. 94
$8,490,000.00
575,000.00
1,729,860.00
884,176,000.00
322,062.02
255,000.00
919,608.80
8, 500,000.00
64,439,613.43
836,913. 650.00
3,167,246.89
904,966, 430.82
/
SECRETARY OF THE TREASURY
47
A statement showing the piincipal of funded and unfunded indebtedness of foreign governments to the United States, the accrued and
unpaid interest thereon, and the payments on account of principal
and interest, as of November 15, 1929, will be found as Table 58,
page 526 of this report.
Austria
In my annual report for the fiscal year 1928 there appeared a comj)lete account of the request of the Austrian Government to obtain
from its relief creditors and the Reparations Commission a release of
the liens enjoyed by the relief bonds and reparations charges, in order
that that Government might float in the world markets a new loan
of 725,000,000 schillings, or about $100,000,000, for the purpose of
enabling it to complete its reconstruction program. The rehef creditors include Denmark, France, Great Britain, the Netherlands, Norway, Sweden, Switzerland, Italy, and the United States. It was also
pointed out in that report that it would not be possible to float the
proposed loan as long as the relief bonds and the reparation obligations had a prior lien on Austria's assets, and that Austria had assured
the United States that it was prepared to make a settlement of all the
relief debts. In view of the terms of the relief bonds, Austria could
not make a definitive settlement of the relief debts without the agreement of all nine of the creditor governments concerned. It was
therefore recommended that Congress vest the necessary authority
in the executive branch of the Government to settle the whole matter,
with the limitation that our debt should be settled on terms no less
favorable than those granted the other creditor governments, and
that the security now enjoyed be not released except in so far as
necessary to permit the flotation of the contemplated reconstruction
loan. A bill was then pending before Congress which would give the
Secretary of the Treasury the authority to join with the other creditor
governments in the necessary action to carry out the proposals
contemplated.
.
At this time negotiations for the settlement of the Austrian debt
with the other eight relief creditors were proceeding, but since Austria
was obligated to settle with all on the same basis, the Treasury was
not in a position to submit to the Congress the terms of a proposed
agreement for the settlement of the relief indebtedness to the United
States until an agreement with the other creditors was actually
reached. On December 7, 1928, the Secretary of the Treasury
advised the Congress that the settlement proposed by the Austrian
Government had been accepted by seven of the nine creditor nations;
that negotiations with Italy were then being carried on, and that the
Secretary of the Treasury was at that time enabled to submit to the
Congress the agreement for the settlement of the relief indebtedness
48
REPORT ON T H E FINANCES
of Austria to the United States. AnotEer bill embodying the same
terms with Tespect to the release of the security, and in addition
authorizing the Secretary of the Treasury, with the approval of the
President, to conclude an agreement for the settlement of the relief
indebtedness of Austria to the United States on the general terms
therein set forth was substituted for the bill then pending, passed the
Congress, and was approved by the President on February 4, 1929.
The principal of the indebtedness of Austria, to the United States
is represented by a bond '^Relief Series B of 1920," in the principal ^
amount of $24,055,708.92, which matures by extension in 1943, as
authorized by the joint resolution approved April 6, 1922. Under
the terms of the proposed settlement, Austria offers to pay, beginning
oh January 1, 1943, 25 annual installments of $1,337,140 in full settlement of its indebtedness, reserving the option, however, to substitute the following schedule of payments in lieu of the 25 payments:
5 annual payments of $287,556 beginning January 1, 1929; 10 annual
payments of $460,093, beginning January 1, 1934; and 25 annual
payments of $743,047, beginning January 1, 1944. Austria informed
the creditor governments of its intention to exercise the option of
beginning payments on January 1, 1929. I t paid on that date to
the Treasury the first annual installment due under the alternative
schedule, which the Treasury accepted and deposited in a Secretary's
special deposit account to be held until. the agreement has been
actually concluded, at which time it ^dll be covered into the Treasury
as payment of the first installment of principal due under the agreement. The agreement can not be finally concluded until all of t h e
creditors agree; Italy it is understood has not yet agreed to the terms
offered.
On a basis of 5 per cent per annum, the present value of the sinaller
payments beginning January 1, 1929, under the alternative schedule,,
is the same as that of the larger payments to be begun on January 1,.
1943.
A copy of the statement made by Undersecretary of the Treasury
Mills before the Ways and Means Committee on December 7, 1928,.
regarding the settlement, to which is attached a copy of the proposed
agreement to be executed, and a copy of the act of Congress approved
February 4, 1929, authorizing the settlement, will be found as Exhibits
16 and 17, pages 289 and 299 of this report.
Czechoslovakia
The Govei^nment of Czechoslovakia has not yet ratified the funding agreement concluded on October 13, 1925, and for that reason
has not delivered bonds for the obligations now held as provided for
under the agreement. Czechoslovakia has, however, continued tomake payments regularly under the funding agreement.
SECRETARY OF THE TREASURY
France
,
49
^
In the spring of 1929, the Treasury was faced with the following
situation. The obligations of France, dated August 1, 1919, in the
aggregate face amount of $400,000,000 given for surplus war materials
purchased on credit from the United States Liquidation Commission
(War Department), would mature on August 1, 1929. The indebtedness represented by these obligations would be merged in the war
debt imder the terms of the funding agreement of April 29, 1926,
but this funduig agreement would not become effective until ratified
by both France and the United States. Ratification was under consideration by the French Parliament, with every assurance that it
would be eventually authorized, but the Congress of the United
States was considering recessing for a period which would extend over
the maturity date of the obligations. The Treasury was therefore
faced with the possibility of a French ratification prior to August 1,
1929, and no authority on the part of the Secretary of the Treasury
to do other than present the maturing obligations for payment.
Under the circumstances, the matter was submitted to Congress
in May, 1929, with the recommendation that in the event the
funding agreement was ratified in France in accordance with its terms
prior to August 1, 1929, the Secretary of the Treasury, with the
approval of the President, be authorized to enter into an agreement with France providing for the postponement of the date of
maturity of these obligations from August 1, 1929, to such time
as Congress should approve or disapprove the funding agreement,
but in no event beyond May 1, 1930, provided, however, that France
agreed to continue to pay interest on such obligations, any interest
so paid to be credited against the amounts first due under the funding agreement. After consideration House Joiat Resolution 80,.
embodying the recommendations set forth above, was passed by
both Houses of Congress, but in the haste of adjournment failed to
receive the usual formal approval of the Speaker of the House and
the President of the Senate, consequently failing to be enacted into
law prior to August 1, 1929.
The French Government ratified the funding agreement under date
of July 27, 1929. Relying on the expression of the sentiment of the
Congress on the matter contained in the resolution, the Secretary of
the Treasury, with the approval of the President, in an exchange of
correspondence agreed with France to extend the maturity date of
the obligations in question upon the terms and conditions set out in
the resolution. A copy of the letter from the Secretary of the Treasury, dated July 29, 1929, to the ambassador of France at Washington
and a copy of the ambassador's reply, on behalf of his government,
dated July 29, 1929, forming the agreement authorized by the resolu71799—30—Fi 19 2 9
6
50
REPORT ON T H E FINANCES
tion, will be found a^s Exhibit 21, page 303 of this report. The House
Joint Resolution was subsequently enacted into law, being approved
by the President on October 17, 1929, a copy of which will be
found as Exhibit 18, page 301. Upon receipt of information from
France that it had ratified the funding agreement, the President and
the Secretary of the Treasury issued public statements commending
the French Government for its action, copies of which wiQ be
found as Exhibits 19 and 20, page 302. The funding agreement
will shortly be submitted to the Congress for its approval.
The French Government has continued to pay the interest due on
the obligations given for surplus war supplies and has made additional
payments which have been applied on account of principal of demand
obligations given for cash advances. The following statement shows
the total amount of payments received from France since June 15,
1925, the date as of which the funding agreement will become effective
when ratffied, which, in accordance with the understanding, will be
applied toward the annuities first due under the funding agreement
on ratification, and the amounts payable under that agreement:
Payments received
Fiscal year
1926 . .
1927
1928
1929
-
Total
.
Annuities due
under funding
agreement
$20, 368, 057. 25
30,368,940. 06
31, 644, 482.17
20, 367, 057. 26
$30,000,000.00
30,000,000.00
32, 500, 000.00
32, 500, 000.00
» 102, 748,536. 74
125,000,000.00
1 Additional $10,183,528.63 received since June 30, 1929.
Greece
In my annual report for the fiscal year 1928 a full account was
included of the conferences between the Secretary of State and the
Secretary of the Treasury, representing the United States, and the
Greek minister at Washington, representing the Greek Government,
for the purpose of finding a basis for the settlement of the indebtedness of the Greek Government to the United States and of the differences between those two Governments arising out of ;:he tripartite
loan agreement dated February 10, 1918. As a result of these conferences it was recommended to the Congress that authority be
vested in the Secretary of the Treasury to conclude, with the approval
of the President, an agreement along the following lines:
1. The amount owed by Greece to the United States as a result of
cash advances of $15,000,000 to be refunded over a period of 62 years.
There are listed below the payments to be made by Greece to the
United States under the proposed settlement:
July 1, 1928
Jan. 1. 1929
.
$20,000
20,000
SECRETARY OF THE TREASURY
July 1, 1929
Jan. 1, 1930..
July 1, 1930
Jan. 1, 1931
-
51
_--_ $25,000
25,000
30,000
30, 000
July 1, 1931
110,000
Jan. 1, 1932
110,000
July 1, 1932
130,000
Jan. 1, 1933
_,_
_.
^--- 130, 000
July 1, 1933, and semiannually thereafter to'Jan. 1, 1938, 10 pfkyinents
eachpf150, 000
July 1, 1938, and semiannually thereafter to Jan. 1, 1990, 104 payments
each of
175,000
2. Greece to forego all claims for further advances under the tripartite loan agreement of February 10, 1918, which agreement, so far
as the United States and Greece are concerned, is to be regarded as
terminated.
3. The United States to advance to Greece $12,167,00a with
interest at the rate of 4 per cent per annum with provisions for a
sinking fund to retire the loan in 20 years, the service of the loan
to be administered by the International Financial Commission.
4. The new loan by the United States to Greece to be turned over
in its entirety to the Refugee Settlement Commission, to enable the
commission to continue its humanitarian work of establishing in
productive work in Greece approximately 1,500,000 Greek refugees
driven from Asia Minor.
The Congress enacted the necessary legislation, which was approved
by the President on February 14, 1929, authorizing the settlement
of the indebtedness and the financial differences along the lines recommended. The agreement was executed on May 10, 1929, by the
Greek minister at Washington, on behalf of his Government, and by
the Secretary of the Treasury, with the approval of the President,
on behalf of the United States. As provided for under the terms
of the agreement, the Secretary of the Treasury advanced on May 10,
1929, to the Greek Government, the sum of $12,167,000 for which
the Greek minister delivered to the Treasury 40 gold bonds of his
Government, in the same aggregate face amount, dated May 10,
1929, payable semiannually over the succeeding 20 years, with interest
at the rate of 4 per cent per annum, payable semiannuaUy. In
accordance with the provisions of the agreement, the Greek minister
also delivered to the Treasury 124 gold bonds of his Government aggregating in face amount $20,330,000 representing the funded indebtedness of Greece to the United States, in exchange for the obligations
of the Government of Greece, in the face amount of $48,236,629.05
(against which $15,000,000 had been advanced in cash), given to
the United States for credits established under the tripartite loan
agreement of February 10,1918.
52
REPORT ON THE FINANCES
A copy of the agreement concluded May 10, 1929, copy of the act
of Congress of February 14, 1929, copy of the press release of May
10, 1929, issued by the Secretary of the Treasury at the time of the
signing of the agreement, and a copy of the schedule of payments ta
be made by Greece on account of the new loan, will be found as
Exhibits 22, 23, 24, and 25, on pages 305, 306, 308, and 318 of this
report.
Yugoslavia
The Government of the Serbs, Croats, and Slovenes (Yugoslavia)^
delivered to the Treasury on December 1, 1928, the new obligations
in exchange for the old obligations held by the United States, as
provided for in the funding agreement of May 3, 1926. Copy of the
press statement of the Secretary of the Treasury will be found as
Exhibit 26, page 313.
RECEIPTS FROM GERMANY AND THE YOUNG PLAN
Under the terms of the agreement providing for the distribution of
the Dawes annuities, signed at Paris on January 14, 1925, the United
States is entitled to receive annually from Germany in discharge of
her treaty obligations, certain payments on account of the reimbursement of the costs of the United States army of occupation and the
awards of the Mixed Claims Commission established in pursuance of
the agreement of August 10, 1922, between the United States and
Germany. The United States has received each year out of the
Dawes annuities up to August 31, 1929, the amounts stipulated under
the Paris agreement of January 14, 1925, for these two accounts.
The Dawes plan under which Germany has made reparation payments since 1924 was the result of recommendations made in 1924 by
a committee of experts, headed by Gen. Charles G. Dawes. This
committee was invited by the Reparation Commission, in its decision of November 30, 1923, to consider the means of balancing the
budget and the measures to be taken to stabilize the currency of
Germany as well as determine what reparation payments might be
made by Germany in the immediate future. While it was not within
the jurisdiction of this committee to consider the definitive fixation
of Germany's reparation liabilities, it presented a plan of settlement
which was intended to operate for a sufficient time to restore confidence and which would eventually lead to a final and comprehensive
agreement. As confidence has now been restored and Germany has
been reestablished on a relatively high level of economic activity,
the time seems favorable for the definite settlement of the reparation question. Such a settlement is desirable not only for the
benefit to Germany but also because of the element of uncertainty
existing in the affairs of all other countries concerned in repa
SECRETARY OF THE TREASURY
53
rations. Decisive steps were taken in the direction of final settlement by representatives of the Governments of Germany, Belgium,
France, Great Britain, Italy, and Japan in the agreement reached at
Geneva on September 16, 1928, for the appointment of a committee
of financial experts to be intrusted with the task of drawing up
proposals for a complete and final settlement of the reparation problem. The committee, consisting of representatives from the countries
mentioned above and two citizens of the United States, were appointed during January, 1929. The first regular meeting of the
<iommittee was held in Paris on February 11, 1929, at which Mr.
Owen D. Young, an American citizen, was elected as its chairman.
After protracted negotiations the committee finally reached an agreement on June 7, 1929.
The plan, commonly referred to as the Young plan, presented by this
committee, provides among other things that Germany shall pay an
average annuity, exclusive of the annual sum required to meet the
services of the German external loan of 1924, of 1,988,800,000 reichsmarks ($473,732,160) over 37 years, which on a 5K per cent basis has
a present value of about 31,172,000,000 reichsmarks, and varying
annuities for 22 additional years. The committee also recommended
a division of the annuities among the several creditor governments,
in accordance with which the United States will receive on account of
its claims for army costs and mixed claims an average annuity of
'66,100,000 reichsmarks for 37 years and 40,800,000 reichsmarks for 1*5
years thereafter.
The committee did not in its report name the sums to be allocated
to army costs account and to mixed claims account. The Treasury
Department recommends, however, that of the sums to be received
40,800,000 reichsmarks be allocated to the satisfaction of mixed claims,
and that the balance be allocated to the satisfaction of the United
States Government claims on account of army costs. The reduced
amounts to be received under the Young plan as compared with the
Dawes plan involve, except in the case of a 10 per cent reduction of
army costs claims explained below, a postponement rather than a
diminution of the total sums to be paid. The ultimate liquidation of
both accounts will necessarily .be postponed, but since the claims in
the one account are those of individuals to whom the time element is
necessarily very important, and in the other the claims of the Government to which the time element is of no great consequence, it is
felt that the former should have some preference.
The Young plan is intended to provide a schedule of payments that
when made will completely discharge Germany's treaty obligations.
I n so far as the United States are concerned, the plan involves some
modification of treaty obligations. I t will be necessary, therefore,
for the Congress of the United States to authorize the executive
54'
REPORT ON THE FINANCES
branch of the Government to enter into an agreement with the
German Government providing that the payments above described
when completed will discharge Germany's obligations to our Government arising on mixed claims and army costs accounts. The Treasury
Department recommends that such authority be granted, for no one
will question the desirability of a complete and final settlement of all
war obhgations still outstanding, and the proposed settlement demands
but unimportant concessions on the part of our Government and of
those of our citizens who have claims against Germany.
Army costs
Under the Paris agreement of January 14, 1925, the United States
received out of each Dawes annuity, beginning September 1, 1926,
the sum of 55,000,000 reichsmarks as reimbursement of the costs of the
American army of occupation. During the fifth annuity year ended
August 31, 1929, the United States received on this account the
55,000,000 reichsmarks stipulated in the Paris agreement, or the
equivalent of $13,044,569.72, making a total received to August 31,
1929, out of the Dawes annuities of 165,000,000 reichsmarks or
$39,203,725.89. The army cost account as of September 1, 1929,
stood as follows:
Total Army cost charges (gross), including expenses of Interallied Rhineland High Commission (American department) _. $292, 663, 435. 79
Credits to Germany:
Armistice funds (cash requisition on
German Government)
$37, 509, 605. 97
Provost
fines--.
159, 033. 64
Abandoned enemy war material
5,240,759.29
Arniistice trucks
.
1, 532,088. 34
Spare parts for armistice trucks
355, 546. 73
Coal acquired by Army of occupation...
756. 33
44, 797, 790. 30
247, 865, 645. 49
Payments received:
Under the Army cost agreement of May
25, 1923, which was superseded by
agreement of Jan. 14, 1925
'Under Paris agreement of Jan. 14, 1925. .
14, 725, 154. 40
39, 203 725. 89
53, 928, 880. 29
Balance due as of Sept. 1, 1929
.
193, 936, 765. 20
Beginning September 1, 1929, the United States will receive, under
the Young plan if it is inaugurated, an average annuity of 25,300,000
reichsmarks for 37 years, in full liquidation of our Army costs. In
this connection, the Young plan contemplates a reduction of 10 per
cent in the total amount of the Army costs originally due the United
55
SECRETARY OF THE TREASURY
States. It is understood that France and Great Britain will make a
similar sacrifice, If Congress authorizes the acceptance of the reduction of 10 per cent of our total Army costs, the amount due wilL be
reduced by about $29,266,000. The annuities proposed under the
Young plan will liquidate the balance due, after deducting the 10
per cent, over the 37-year period and allow interest on all deferred
payments at a rate of about 3% per cent. The deferred payments
represent the difference between the 55,000,000 gold marks received
under the Paris agreement and the annuities proposed under the
Young plan. The annuities proposed for Army costs are as follows:
Year
Year
In millions of reichsmarks
1 (comprises 7 months, Sept. 1,
1929, to Mar. 31, 1930)
25. 1
2- —
25. 5
3-4
25. 3
5-8_-18. 6
9-10
16. 4
11-1213-20
21-37
In millions of reichsmarks
.
Average
18. 6
25. 3
35. 3
25. 3
Mixed claims
The Paris agreement of January 14, 1925, made provision for the
United States to receive on account of the awards of the Mixed Claims
Commission, United States and Germany, 2)i per cent of that part
of each Dawes annuity available for distribution as reparations, not
to exceed, however, in any one year the sum of 45,000,000 gold marks.
During the fifth annuity year ended August 31, 1929, the United
States received for this account the sum of 45,150,573.84 gold marks
or $10,719,030.38, which includes a small amount received in
September, 1928, for account of the fourth annuity. The total
receipts from Germany for account of mixed claims amounted up
to the close of the fifth annuity year to 133,950,289.49 gold marks
or $31,831,472.03. The following statement shows as of August 31,
1929, the estimated liability of the German Government on account
of the awards of the Mixed Claims Coinmission. It is not possible
to furnish at this time an accurate statement of this account for the
reason that the commission has not yet completed its work. This
statement is based on the best information available at this time, but
should not be construed to indicate the total amount of awards to be
rendered by the commission.
Principal of .awards certified to Treasury for
payment
$113, 295, 478. 68
Interest up to Aug. 31, 1929
59, 407, 605. 03
$172, 703, 083. 71
Estimated principal amount of awards yet
to be entered and certified
Estimated interest up to Aug. 31, 1929
32, 000, 000. 00
21, 000, 000. 00
53, 000, 000. 00
56
REPORT ON THE FINANCES
Awards to United States Government
Interest up to Aug. 31, 1929
$42, 034, 794. 41
22, 900, 000. 00
$64,934,794.41
290, 637, 878. 12
Received from Germany up to Aug. 31,1929.
Earnings and profits on investments
31, 831, 472. 03
2, 149, 692. 70
:
Estimated balance due as of Sept. 1, 1929.
----
33,981,164.73
256, 656, 713. 39 ,
If the acceptance of the annuities proposed under the Young plan
is authorized by Congress, the United States will receive for account
of mixed claims beginning September 1, 1929, an annuity of 40,800,000
reichsmarks for a period of 52 years. The Mixed Claims Commission
has not completed its work and no accurate statement can therefore
be made as to the exact total amount of nor the number of years
required to pay oft' the various classes of claims under the settlement
of war claims act of 1928. On the basis of the best information obtainable at this time, it has been estimated, however, that it will require
the entire 52 years with annuities of 40,800,000 reichsmarks to pay all
claims; about 35 years to pay all the private claims awarded to
American citizens, including the return of the unallocated interest
fund belonging to the German claimants; and about 17 additional
years to liquidate the claims allowed the Government of the United ^
States. On the basis of the 45,000,000 gold marks received under the
Paris agreement, it was estimated that it would have required 30
years to pay off private claims and 14 additional years for Government
CREDIT CONDITIONS
Toward the end of the calendar year 1927 the Federal reserve
system began to exert its influence in the direction of firmer money
market conditions. This policy was adopted primarily because of
continued growth in the volume of member bank credit at a time
when credit requirements of industry and trade were not expanding
and when the demand for credit from the security market was increasing. In pursuance of the system's firm money policy, a large outflow
of gold to foreign countries during the first half of 1928 was permitted
to have its full efi'ect on member bank reserves, and in addition the
reserve banks sold several hundreds of millions of securities. By the
middle of 1928, the beginning of the fiscal year ended June 30, 1929,
the countr3^'s stock of monetary gold had declined by about
$500,000,000 from the level of the preceding June, and reserve bank .
holdings of securities had been reduced by about $170,000,000. This
outflow of gold and the sale of securities by the reserve banks tended
to deplete member bank reserve balances, and led to increased borrowing at the reserve banks to restore these balances to the level required
^
SECRETARY OF THE TREASURY
57
by law. The volume of discounts for member banks averaged somewhat in excess of $1,000,000,000 in June and was larger than at any
time since the beginning of 1922. Furthermore, the rates of discount charged by the reserve banks on member bank borrowing,
which in the early autumn of 1927 had been 3K per cent at all reserve
banks, were increased by the 7th of June to 4 ^ per cent throughout
the system. Discount rates were further advanced to 5 per cent in
July at the New York bank and soon thereafter at all other reserve
banks, except four western banks, which did not increase their rates
until the spring of 1929.
In August, 1928, the reserve banks, with a view to accommodating
the seasonal demand for credit to finance the harvesting and marketing
of agricultural products, increased their purchases of acceptances, and
by the middle of November the banks' holdings of bills had grown
by $300,000,000. The reserve funds made available to member
banks by the purchase of acceptances enabled them to meet the
increase in the demand for currency, which is usual at this period
of the year, particularly in agricultural sections of the country, and
at the same time to liquidate a part of their indebtedness at the
reserve banks. The system's purchases of acceptances also had the
effect of producing somewhat easier conditions in the money market,
and of facilitating the financing of the seasonally heavy movement of
commodities to foreign markets.
During 1928, accompanying the reserve system's firm money
policy, there was a slowing down in the growth of bank credit.
Total loans and investments of member banks in leading cities,
following rapid growth in the early part of the year, declined somewhat between May and November, notwithstanding the growth in
the requirements for financing commercial and agricultural operations. The volume of loans on securities remained relatively constant
during this period, while investment holdings were reduced. In the
latter part of the year, however, easier conditions in the money market
were accompanied by renewed increase in the demand for credit in
the security market, which was reflected at the end of the year in
marked flrmness in rates for open market collateral loans. There
was a further growth of member bank loans to brokers and dealers
in securities as well as continued increase in the volume of such loans
made by corporations and individuals, both foreign and domestic.
Conditions after the turn of the year indicated the persistence of
influences tending toward the excessive flow of credit through speculative channels and the continuance of firm money conditions. In
February the Federal Reserve Board, in communications to the
reserve banks and in published statements, took the position t h a t
individual member banks were not acting within the spirit of the
Federal reserve act if they were continuously borrowing from the
58
REPORT ON T H E FINANCES
reserve banks and at the same time expanding their loans on securities
or even maintaining a large volume of such loans. In April and May
security loans for member banks declined, and during May total
loans and investments of member banks were in about the same
volume as a year earlier, indicating that an entire year had elapsed
without any growth in bank credit. In June, however, there was a
rapid rise in loans on securities, and in July, August, and September
a large growth of loans, chiefly for commercial and agricultural purposes. Although these increases were offset in part by a decline in
investments, total loans and investments, which for member banks in
leading cities averaged $22,646,000,000 during September, were
about $330,000,000 larger than in January and $780,000,000 above
the level of September, 1928.
Money rates, which had advanced throughout the larger part of
1928 and the first half of 1929, were at the end of that period at the
highest levels in more than seven years. The development of firm
money conditions had its most pronounced effect on open-market
rates, particularly rates paid on loans collateraled with stocks and
bonds. Open-market rates on time loans on securities, at S-S% per
cent in June, were about 2% per cent higher than a year earlier, while
rates on bankers' acceptances, at 5K per cent, were about Iji per cent
above the level of the year before, and rates on commercial paper,
at 6 per cent, were 1^ per cent higher. During the same period rates
on loans to customers increased on the average by about one-half of
I per cent for the country as a whole. Although rates on commercial
loans, both in the open market and to customers, increased during
the year ample credit was available to accommodate the large volume
of industry and trade. While there was some recession in the construction industry, there was no evidence that business activity in
general was unfavorably aft'ected. There was, however, a marked
falling off in the volume of bond issues brought out during the period.
This was particularly true of offerings of foreign corporate and governmental issues. Notwithstanding this sharp decline in long-term
foreign financing in this country, foreign countries were able to continue the importation of American commodities in large volume and
also to place funds in the United States to be used in the purchase of
securities and in short-time loans to the security market.
The movement of funds to the United States from abroad caused
by the high level of money rates and the attractiveness of security
investments resulted in the early part of 1929 in a considerable
importation of gold by this country. By the end of June the total
stock of monetary gold in the country was more than $200,000,000
above the low point reached at the middle of 1928, an increase which
represented nearly one-half of the gold exported in 1927 and 1928.
This increase in gold stock was the chief factor accounting for a
SECRETARY OF THE TREASURY
59
decline in the demand for reserve bank credit in the early part of
1929. I t was not, however, reflected in a decline of member bank
indebtedness, but was taken up in the Hquidation of reserve bank
holdings of acceptances which proceeded rapidly during this period.
Member bank indebtedness at reserve banks during June, at about
$1,000,000,000, was in about the same volume as a year earlier.
The decline in acceptance holdings in the first half of the year reflected in part the fact that the system's buying rates for acceptances
were above the discount rate, a situation which was less favorable to
the sale of acceptances to the reserve banks. I n July and August,
buying rates on acceptances were reduced, while on August 9 the
discount rate was advanced from 5 to 6 per cent at the New York
reserve bank. As a consequence, bill holdings of the reserve banks
increased and conditions in the money market became somewhat
easier at the time of year when agricultural activities give rise to
seasonal increase in credit requirements.
A review of the policy of the Federal Reserve Board during the past
year shows that it has endeavored to guard against an undue extension of credit through speculative channels and to conserve the
country's credit resources for the purpose of meeting future requirements of industry and trade. The gold that came into the country
during the year ended June 30, 1929, was not added to member
bank reserves and did not constitute the basis of expansion of the
country's credit structure, but was iised to liquidate reserve bank
credit. Chiefly as a result of the inflow of gold, total reserves of all
reserve banks increased by more than $300,000,000 during the year.
Since the banks' total note and deposit liabilities showed relatively
little growth, the reserve ratio for all banks combined increased
from 68 per cent to 74.5 per cent and the volume of reserves in excess
of legal requirements increased by about $300,000,000. At the end
of the period, therefore, the reserve banks were in a stronger position
than a year earher, and were better prepared to meet any emergency
demands that might arise, as well as to provide the basis for meeting
the increase in the country's credit requirements growing out of
year-to-year growth in the volume of industrial, commercial, and financial activity.
BRANCH AND GROUP BANKING
In banking, as in other enterprises of this country, there is increasing evidence of a movement toward larger operating units. The
number of branches of banlvs in operation has increased and more
recently there has been a growth also in the number of groups in which
several independent banks are operated more or less as a single
system. Both of these developments reflect changes in the underIving: economic situation.
60
REPORT ON T H E FINANCES
Branch banking has always existed in this country to a limited
extent in one form or another. At the present time the Federal
reserve act and the national bank act, as amended in 1927, authorize
national member banks to establish branches in foreign countries,
and in insular possessions of the United States, and all member
banks to establish branches within the corporate limits of the center
in which the head office of the parent bank is situated and in which
State laws permit State banks to operate branches (with certain
restrictions as to the size of centers in which branches may be established by national banks). At the end of June, 1929, state-wide
branch banking was permitted in 9 States and in the District of
Columbia; branch banking in more limited form was speciflcally
permitted in 11 States; and in 23 States the operation of branch
systems was specifically prohibited.
In June, 1929, out of a total of 8,707 member banks in the Federal
reserve system, 354 were operating 2,291 branches. This represents
an increase of 130 branches during the year. On the same date 818
banks, including both member and nonmember, were operating a
total of 3,440 branches, an increase of 210 for the year. The development of branch banldng which is permitted by existing legal arra'ngements has facilitated the adaptation of banking facilities to requirements of urban areas.
More recently there has been a rapid increase in the organization of
group systems of banks. Such groups comprise one or more banks
that are brought under unified control and some degree of centralized
management through acquisition by an individual or corporation of a
controlling interest in their stock issues. Although technically each
bank in a group is a separate corporation operating with its own capital
funds and under the direct supervision of a local board of directors, a
certain degree of unity is achieved for the group as a whole. At the
end of June, 1929, it was authoritatively reported that there were in
existence at the time 230 group systems of banks in the United
States, which embraced about 2,000 banks. Group banking is, a
means of accomplishing in a measure the objects of more extensive
branch banking systems than are permitted under the Federal
reserve act or under existing legal arrangements in most States.
Although banking groups may be expected in most instances to
strengthen the banks which they control, the organization of such
groups places great responsibilities upon the controlling interests, and
is a matter of vital interest to State and national supervisory agencies.
In view of the fundamental economic situation which has given
impetus to the organization of group banking systems and to the
growth in branch banking, it is desirable that these developments be
carefully studied. In the meantime it is hoped that any further
extension of group and branch banking organizations will proceed
SECRETARY OF THE TREASURY
61
with moderation, and that hasty legislation, either to liberalize or to
constrict limitations now in effect, will be avoided. Our banking
structure, the product of many years of experience, is part of an
intricate economic fabric whose parts are closely adjusted to one
another, and a too rapid reorganization would be likely to create
serious and costly disturbances that would affect the entire country.
The time has come when it would seem to be wise to undertake a
thorough study of the situation with a view to determining the soundness of the present-day tendencies, and more particularly the limits
of the economic units within which branch banking may be advantageously permitted.
FEDERAL FARM LOAN SYSTEM
Reorganization of Farm Loan Bureau completed
The reorganization of the Farm Loan Bureau, discussed in my last
two annual reports, has been virtually completed. This task was
begun on May 10, 1927, when the Federal Farm Loan Board was
reorganized for the purpose of correcting unsatisfactory conditions
that had developed in a number of the banks. At that time the
system was passing through the greatest crisis of its history. One
joint stock land bank was in the hands of a receiver; receiverships
for two other joint stock land banks were impending; and several
other land banks, both Federal and joint stock, were faced with
difficult situations. The board, moreover, did not have an adequate
organization to handle these new problems. These conditions tended
to impair pubhc confidence in the situation and called for prompt and,
in many cases, vigorous action.
One of the most urgent steps in the program of reconstruction was
the development of an organization in the bureau through which the
board could perform its supervisory function adequately. This has
been largely accomplished. Aside from temporary vacancies, the
examining staffs have been brought to a strength which will permit
two examinations of every bank and one examination of every
, national farm loan association each year. The corps of land bank
appraisers has been and is being improved by weeding out those
ineligible under the law and those not qualified or adapted for the
work, and by careful instruction, assistance, and checking up through
the 12 reviewing appraisers. The secretarial and legal staffs and the
statistical division have been improved by making needed changes
or additions to their personnel. One new unit, known as the securities division, was created during the fiscal year 1929. I t handles
administrative matters relating to bonds, debentures, and stock
issues, and to the operations of the 12 registrars' offices, the office of
62
REPORT ON T H E FINANCES
the custodian of securities, which was formerly called the bond
division, and the receiverships of three joint stock land banks.
Throughout this reorganization, the board has taken the position
that the Congress intended that the system should be administered
in a strictly nonpartisan manner and entirely free of politics. Accordingly, all appointments have been made solely on the basis of character, efficiency, and demonstrated ability, regardless of every otherconsideration. Merit alone has been the basis of retention as well
as appointment in the. service. Through this policy, it has been
possible to assemble a corps of competent workers.
Progress and im.provements
The more effective supervision by the board has resulted in tangible
evidences of improvement in the conduct of the business of the banks.
One important step has been the changes that have taken place in
the management of several of the banks confronted with difficult
problems. It has been recognized that the measure of the. success
of the system depends in a large degree upon the abihty and efficiency
of the officers and directors of the banks. The board has felt, therefore, that a primary consideration is for the banks to have directors
of recognized abihty and experience, interested in improving the
operations of the institutions. The board, moreover, has cooperated
with the directors, in ever}'- case where it seemed necessary, in the
reorganization of the management and personnel of the banks. This
has resulted in a complete change in the executive officers of three
Federal land banks and five joint stock land banks, and steps have
beeri taken to strengthen the executive staffs of other banks. In all
cases* the new executives have been selected by the directors on the
basis of their demonstrated abffity and fitness to handle the situations
confronting the banks.
Related closely to the efforts to strengthen the executive personnel
of the banks has been an important development of pohcy with
respect to the relationship between officers and directors. The bylaws of all Federal land banks previously provided that their principal
executive officers must be chosen from the membership of their respective boards of directors.' At least three, and in some instances, a
majority of the directors were officers of the banks. As a matter of
principle, the requirement that the board of directors should have
such a preponderance of bank officers among its membership would
appear to discourage or prevent the directors from fully discharging
their function of critically reviewing and passing judgment upon the
acts of the officers. The Farm Loan Board feels that it is not desirable
that active officers of the Federal land banks serve as directors,
except in the case of the president, who necessarily is the point of
SECRETARY OF THE TREASURY
63
contact between the directors and the management. During the
past two years, with the approval of the board, 9 of the 12 Federal
land banks have amended their by-laws according to this principle, 7
providing that only the president must be a member of the board of
directors and 2 that none of the officers need be chosen from the
directorate. The board has followed the policy of requesting the
officers of the banks to make available to the members of their boards
of directors the reports of the examiners and the bureau's letters in
reference thereto in order that the directors may be fully informed
currently upon the condition of the banks and the problems with
which they are confronted.
Parallel with the changes in management have been the measures
taken to institute sound and legal banking practices. Apparent violations of the law have been reported to the Department of Justice
for prosecution whenever the facts warranted such action,, The banks
have been assisted in developing a sounder loaning pohcy, partly
through the striengthehing of the staff of appraisers appointed by the
board and partly through a more thorough examination of loans in
the banks and of loans submitted to the bureau for approval as
collateral for bond issues. The bureau also has cooperated with the
banks in introducing better business methods and in effecting economies. Special emphasis has been placed upon the accounting procedure of the banks. Every effort has been made to secure the
adoption of accounting methods which refiect accurately their operations, progress, and condition. Particular attention has been paid to
the statements of condition published quarterly by the board, which
now more accurately reflect the actual condition of the banks. In
some case?, the adjustment of its statements to an accurate basis hashad the effect of apparently indicating a bank in worse condition than
formerly. For Example, some banks had carried real estate in the
names of nominees and did not reflect it on their balance sheets.
The addition of such real estate to the banks' assets tended to indicate
retrogression whereas progress actually had been made. Many other
adjustments have been made in the interest of accuracy and uniformity, thereby placing the statements of condition on a comparable
basis as far as possible.
The condition of the national farm loan associations has been
improved. More thorough examinations have revealed defects and
irregularities which have been cured by the application of appropriate
remedies and the system as a whole has been greatly beneflted by the
closer supervision that has been accorded the associations by the
board. Federal land banks have held group meetings of the associations in their respective districts, and officers of the banks have
conferred with the secretary-treasurers and directors of individual
associations where such action seemed desirable. The board has
64
REPORT ON T H E FINANCES
encouraged such group 'meetings and individual conferences for the
consideration of the problems of the banks and the associations.
Extensive study and research has been conducted for the purpose
of aiding the board and banks in developing sound policies. This has
been particularly true of matters relating to law, much being accomplished in the way of interpreting the law on a uniform basis applicable
to the whole system. Many special projects are under way and in
various stages of completion. These include: The preparation of
uniform systems of accounts for land banks, revision of the rules and
regulations of the board, instructions to appraisers, instructions to
registrars, and instructions to national farm loan association examiners.
Special problems
General conditions in the money market that affected the sale of
all classes of securities, including obligations of the Government,
naturally had their influence on farm loan bonds. The Federal land
banks were faced with the choice of undertaking to issue long-term
bonds in volume at high rates of interest in a situation that appeared
to be temporary, or endeavoring to take care of their requirements
by the issuance of bonds in minimum amounts supplemented by the
utilization of repayments and mstallment payments on loans, and
such temporary financing as seemed to be desirable and necessary.
The banks chose the latter course, which appeared to be the wiser
until the bond situation clears and improves. Federal land banks
in the first part of the fiscal year issued bonds at 4)^ per cent and in
the latter half at 4 ^ per cent. Banks issuing 4 ^ per cent bonds
increased their lending rate from 5 or 5% per cent to 5K per cent.
Somewhat similar conditions confronted joint stock land banks,
which for the most part have been marldng time, as far as undertaking to sell bonds is concerned, until they are able to dispose of their
seourities at satisfactory rates. Some joint stock land banks issued
bonds during the year at 4}^ and 5 per cent and the lending rate in
these cases was 5}^ or 6 per cent, according to the rate borne by the
bonds.
General conditions in the securities market likewise affected the
issuance of Federal intermediate credit bank debentures. These
short-term securities were issued during the year at rates ranging
from 4% to 5K per cent. The 5)^ per cent debentures were outstanding only a relativel}^ short period of time and were replaced by debentures bearing 5 per cent interest. The cost of the money naturally
resulted in increases in the lending rates of the banks. Federal
reserve banks cooperated helpfully with the intermediate credit banks
by rediscounting paper and purchasing debentures.
Under the stimulus of the board's supervision, many of the land
banks having large real estate accumulations have organized real
^^
SECRETARY OF THE TREASURY
65
estate departments in order to handle the sale pf acquired farms intelligently and effectively and to hasten the process of putting these
assets upon an earning basis. The market for farm real estate has
shown some improvement in some sections during the year. The
policy of the banks in disposing of their acquired farms has not been
to dump them on the market indiscriminately nor to sell regardless of
price. Buyers, however, have been actively sought, each case being
handled on its merits and the sale negotiated at a price which represented, in the bank's judgment, a fair value, or the greatest amount
obtainable in view of all the circumstances.
In September, 1928, a severe hurricane did material damage to
agriculture over a large part of the island of Porto Rico. While the
losses have not been as serious as the early reports indicated, the
effect, nevertheless, has been to slow up collections to a marked
extent. This situation is receiving the close attention of the Farm
Loan Board and the Federal Land Bank of Baltimore, which has a
branch bank located in San Juan.
There was no change during the year in the number of joint stock
land banks in receivership. On February 28, 1929, the receiyer for
the Kansas City Joint Stock Land Bank published a report giving
his valuation of the assets of that bank as of December 31, 1928.
This report showed a deficit exceeding the amount of its entire capital
stock, and, accordingly, upon his recommendation, the board on
March 23, 1929, levied an assessment upon the stockholders of that
bank amounting to 100 per cent of its capital stock.
An important development in corinection with such assessments
was a unanimous decision of the Circuit Court of Appeals for the
Seventh Circuit in a suit instituted by the receiver of the Bankers
Joint Stock Land Bank of Milwaukee upholding the right of the
Federal Farm Loan Board to make such assessments. Upon petition
by the plaintiff, however, the case was carried by writ of certiorari
to the Supreme Court of the United States, the hearing being setfor
October 21, 1929. There were also unanimous decisions rendered by
the Circuit Court of Appeals for the Eighth Circuit broadly sustaining the powers of the board and,its receiver in cases involving the
Kansas City Joint Stock Land Bank.
Legislation
During the year there were two measures enacted by the Congress
and approved by the President affecting the operations of the system.
The Federal Farm Loan act was amended increasing the maximum
loan which the Federal Land Bank of Baltimore may make in the
island of Porto Rico from $10,000 to $25,000. Section 8 of the
Clayton Antitrust Act, which, in certain circumstances, restricted
71799--30—FI1929
7
66
REPORT ON THE FINANCES
dfficers and directors from serving with other banks, was amended to
exempt joint stock land banks.
Personnel
On April 3,1929, Eugene Meyer, who had been appointed a member
of the Farm Loan Board and designated by the President as farm
loan commissioner at the time of the reorganization of the board on
May 10, 1927, and under whose general direction the program of
reconstruction has been formulated and carried out, requested that
he be relieved of his duties as member of the board and as farm loan
commissioner, effective May 10, 1929. Following the acceptance on
April 29, 1929, of Mr. Meyer's resignation, Paul Bestor, of Missouri,
president of the Federal Land and Intermediate Credit Banks of
St. Louis, was appointed a member of the board and designated by the
President as farm loan commissioner on May 16, 1929. John H.
Guill, of California, was reappointed a member of the board for an
8-year term, ending August 6, 1936. Albert C. Williams, of Texas,
was reappointed a member of the board for an 8-year term expiring
August 6, 1937.
FEDERAL PUBLIC BUILDINGS PROGRAM
' ' •
Gerieral
, Since the submission of my report for the fiscal year 1928, the
Congress has specifically authorized additional projects under the
$265,000,000 Federal building program for the country at large and
the District of Columbia. To date $189,226,010.80 has been authorized for projects outside of the District of Columbia, and $47,968,741
for projects in the District of Columbia, or a total of $237,194,751.80.
Of this amount, $58,142,526.87 has been obligated.
: During the fiscal year 1929, contracts were made for 37 buildings
and major extensions to buildings, involving obhgations of approximately $30,000,000.
A large volume, of work on projects not properly part of the^ public
building program has been performed, among these being a large
hospital at Marion, Ind., for the National Home for Disabled Volunteer Soldiers; a large hospital for the Public Health Service at
Cleveland, Ohio; additional work for the Women's Reformatory at
Alderson, W. Va., for the Department of Justice; studies and drawings
for legations and consular establishments for the State Department;
studies for the Coast Guard Academy; and preliminary studies for
narcotic farms.
Under the appropriation of $500,000 for remodeling and enlarging
pubhc buildings, 71 buildings received attention. In 45 of these the
contracts ranged from $1,100 to $24,361.95, totaling $486,733.27.
The total obligation to June 30, 1929, was $494,581.95. The total
SECRETARY OF THE TREASURY
67
space gained under the entire appropriation was 79,792 square feet.
The average cost per square foot was $6.10, which is considered low.
The Office of the Supervising Architect is called upon to make
examinations of the structural safety of the various buildings in the
District of Columbia under control of the Treasury Department, as
well as other departments, and also to give technical advice to the
various departments, which in some cases involves the preparation
of drawings and specifications; of which an illustration is the construction of the hospital building at the Marion, Ind., Branch
Soldiers' Home, heretofore mentioned. This project provides 250
beds at an estimated total cost of approximately $700,000, and the
construction work is nearly completed. A contract for safeguarding
the dome of the National Museum Building in Washington, D. C ,
which called for extremely careful engineering and observation, was
completed by the office during this year. The new Appraisers
Stores Building in New York City ($8,000,000) was completed and
occupied during this year.
Projects outside the District of Columbia
To date, 334 projects have been authorized for the country at
large, including 8 projects for sites, only, making a net total of 326
building projects. Of these, 84 have been placed under contract,
and the drawings are in various stages of completion on 66 others,
aggregating a total limit of cost therefor of $80,916,000.
Of the 189 new cases where sites and additional land were appropriated for by the acts of March 5 and May 28, 1928, and March 4,
1929, for projects outside of the District of Columbia (under the
$200,000,000 authorization), 78 cases have been closed, involving
an expenditure of approximately $14,519,000; in 37 cases proposals
have been accepted for land in amount $2,835,000, and selections
made in 23 cases involving nearly $5,600,000 and referred to the
Department of Justice for institution of condemnation proceedings.
From ^ime to time as the title is vested in the United States to the
60 pending site cases referred to, the drawings, etc., for the buildings
to be placed thereon will be taken up, and contracts for construction
let at as early a da,te as possible with due regard to the restrictions
placed by law upon the amount that may be expended annually
in carrying the present authorized public-building program to completion.
The remaining 51 site cases are either in the advertising or negotiation stage and definite action in the majority of these cases will be
taken before the end of the calendar year. The amount which will
be required to obtain the necessary land in these cases will probably
exceed $10,000,000.
68
REPORT ON T H E FINANCES
Projects in the District qf Colurhbia
In the District of Columbia 9 projects have been authorized,
including the purchase of the Economics Building for the Department of Agriculture and the Supreme Court Building site, or a net
total of 7 building projects. Five of the building projects have
been placed under contract of which two of the largest are the Department of Commerce Building ($17,500,000) and the Internal
Revenue Building ($10,000,000). This work is progressing rapidly,
and it is expected that the buildings will be completed six months
or a year in advance of the contract time. The Economics Building
has been purchased, leaving the Extensible Building for the Department of Agriculture and the Archives Building yet to be placed under
contract. In the case of the latter two projects, the sites therefor
are being acquired by condemnation proceedings, and it is expected
that title will be vested in the Government within a few months, so
as to permit commencement of construction work within a reasonable
time thereafter.
Meetings on the development of the city of Washington
On April 25 and 26, 1929, two evening meetings, arranged by the
Treasury Department, were held in the council chamber of the United
States Chamber of Commerce in Washington. The object of the
meetings was to report to the President and to the Congress the progress being made in carrying out the plans for the erection of Government buildings in Washington. The meeting on April 25 was attended
by the President, the Cabinet, the United States Supreme Court, the
Senate and House of Representatives, the Fine Arts Commission, and
the,National Capital Park and Planning Commission. The wife of
each official also was invited and the only additional guests were the
members of the American Institute of Architects, then holding its
annual meeting in Washington.
The model, which had just been completed, of the Government
buildings to be erected in the Pennsylvania Avenue Triangle from
Fifteenth Street to the Capitol, was exhibited for the first time; and
a motion-picture film of The City of Washington, which had been
specially made for the occasion under the direction of the Treasury
Department, was shown. The Marine Band Orchestra played during
the evening and the entire proceedings were broadcast over a nationwide radio chain.
The Secretary of the Treasury was the presiding officer. Speeches
were made on subjects relating to the development of Washington by
President Hoover; Hon. Reed Smoot, chairman of the Public Buildings Commission; Hon. Richard N. Elliott, chairman of the Committee
on Public Buildings and Grounds of the House of Representatives; and
SECRETARY OF THE TREASURY
69
by Milton B. Medary, Esq., of Philadelphia, a member of the National
Capital Park and Planning Commission and of the Treasury board of
architectural consultants.
At the meeting on April 26 the presiding officer was Hon. Charles
Moore, chairman of the Fine Arts Commission. The speakers were
Hon. Louis C. Cramton and Hon. A. J. Montague of the House of
Representatives; Edward H. Bennett, Esq., of Chicago, chairman of
the board of architectural consultants of the Treasury Department;
and Maj. L. E. Atkins, of the District of Columbia government. At
each meeting about 1,000 persons were present.
TREASURY ADMINISTRATION OF ALIEN AND MIXED CLAIMS
The settlement of war claims act of 1928 authorized the Secretary
of the Treasury to make payments on account of (1) awards of the
Mixed Claims Commission, United States and Germany, for claims of
American nationals against the Government of Germany; (2) awards
of the Tripartite Claims Commission for claims of American
nationals against the Governments of Austria and Hungary; and
(3) awards of the War Claims Arbiter for claims of German, Austrian,
and Hungarian nationals against the Government of the Unitied
States.
The settlement of war claims act of 1928 provides a limit of two
years from the date of the'^enactment of the act within which application for payment of the awards made in favor of American nationals
can be made.^ This limit expires at the close of business on March 10,
1930. Many of the claims filed under the agreement of August 10,
1922, with Germany have not yet been finally passed upon by the
Mixed Claims Commission, and sufficient opportunity has not been
given many of the claimants filing under the new agreement of
December 31, 1928, with Germany to present proper evidence in
support of their claims. In certain cases before both the Mixed and
Tripartite Claims Commissions, claimants in favor of whom awards
have already been certified to the Treasury for payment, have
changed their addresses without notification. The Treasury has consequently not yet been able to locate these claimants. Especially is
this true of the so-called prisoner of war cases, claims for which were
ffied by the War Department before the Mixed Claims Commission.
These soldiers, in many instances, do not know that claims have been
filed or awards entered in their favor. The awards rendered by the
Tripartite Claims Commission against Hungary have not yet been
certified for payment, and very little time is left for these claimants to
file application for payment. It would seem only fair to the various
claimants concerned that additional time be allowed to locate these
claimants and advise them of their rights. It will, therefore, probably
70
REPORT ON THE FINANCES
be necessary to ask Congress to extend the time for filing applications
from March 10, 1930, to March 10, 1932.
Germany
During the past year the Treasury has continued to make payments
on account of the awards of the Mixed Claims Commission, United
States and Germany. In last year's annual report it was stated
that substantially all of the awards had been paid in full on account
of (1) death and personal injury, and (2) those, other than death and
personal injury, the amount of which, together with interest to
January 1, 1928, did not exceed $100,000. The Treasury issued, on
August 14, 1928, amended regulations covering further pa;yments on
account of awards over $100,000. Claimants who had already
received $100,000 on account of this class of awards, received on
August 22, 1928, a further payment of 30 per cent of the amount
payable as of January 1, 1928, which remained unpaid, a further
payment of 10 per cent on January 15, 1929, and an additional payment of 7 per cent on July 15, 1929. It is contemplated that a
further payment of 9 per cent will be made on December 16, 1929.
In order that the Treasury might be in possession of sufficient
funds to make the additional payments authorized on January 15 and
July 15,1929, it was necessary to request the Alien Property Custodian
to invest in 5 per cent participating certificates, a portion of the
amount authorized by section 25 of the trading with the enemy act,
as amended (20 per cent of the value of the property of German
nationals temporarily withheld). This section authorizes the Alien
Property Custodian upon request of the Secretary of the Treasury to
invest funds of this character in 5 per cent participating certificates
in an ainount not to exceed $40,000,000. Pursuant to the settlement
of war claims act of 1928 these certificates will ultimately be paid out
of funds to be received from Germany on account of awards of ^^e
Mixed Claims Commission.
The remaining balance of the
$40,000,000 is reserved to make payments on account of further
awards to be rendered by the Mixed Claims Commission in connection
with claims now pending before it for consideration. The amount
of the certificate covering the investment made on January 15 was
for $8,500,113.15, and on July 15 was for $1,000,164.29. A copy of the
certificate for $8,500,113.15 will be found as Exhibit 33, page 335, of
this report. The certificate for $1,000,164.29 is of the same general
tenor.
The receipts from Germany for account of the awards of the Mixed
Claims Commission, United States and Germany, are discussed on
pages 52-56 of this report.
SECRETARY OF THE TREASURY
'71
Under the provisions of the settlement of war claims act of 1928,
the President was requested to enter into an agreement with the German Government by which the Mixed Claims Commission would be
given, jurisdiction of and authorized to decide claims of the same
character as those over which the commission then had jurisdiction,
notice of which was filed with the Department of State before July 1,
1928. The act also provided that if such an agreement were entered
into before January 1, 1929, awards in respect of such claims should
be certified for payment in the same order of priority as provided
for other awards of the commission. Under date of December 31,
1928, the agreement was effected by an exchange of notes between
the Secretary of State and the German ambassador at Washington.
(Copies will be found as Exhibit 3°4, p. 336, of this report.) One of the
conditions under which this agreement was effected is as follows:
That the President will recommend to the Congress that the one-half of 1
per cent which the Secretary of the Treasury is authorized by the settlement
of war claims act of 1928 to deduct from awards made by the Mixed Claims
Commission before payment thereof to the claimants for application to the
expenses of the United States incident to the adjudication of the claims, shall,
in so far'as regards the late claims, be made available to the German Government
for defraying such expenses as may be incurred by that Government in connection
with the adjudication of such late claims.
This recommendation was made by the President during the last
session of the Seventieth Congress, but no definite action was taken
thereon. It is assumed that the matter wffi receive appropriate
action during the next session of Congress.
Up to October 31, 1929, the Treasury has made payments in the
aggregate amount of $91,079,271.37, on account of the awards of
the Mixed Claims Commission, from which there was deducted
$455,397.01 representing one-half of 1 per cent for reimbursement
to the United States on account of expenses incurred, making net
payments to claimants of $90,623,874.36. The following summary
statement shows, by class, the number and amount of awards certified
to the Treasury by the Secretary of State, the amount paid on account
and the balance due, as of October 31, 1929:
Number and amount of awards of the Mixed Claims Commission, United States and Germany, certified to the Treasury by the Secretary of State,
and the amount paid and balance due, by class, as of October 31, 1929
Awards certified
1. Amount due on account:
Principal of awards
Less amounts paid by Alien Property Custodian
Interest to Jan. 1,1928, at rates specified in awards
Total payable to Jan. 1,1928
Interest thereon to date of payment, or if unpaid, to Oct.
31,1929, at 5 per cent per annum as specified in the settlement of war claims act of 1928
_.
Total amount due claimants
2. Payments made on account up to Oct. 31,1929:
PrincipaltoofJan.
awards
Interest
1, 1928, at rates specified in awards,
Interest at 5 per cent from Jan. 1,1928, on total amount
payable as of Jan. 1,1928, to date of payment, as directed
by the settlement of war claims act of 1928
_
Total payment to Oct. 31, 1929
Less one-half of 1 per cent deduction from each payment to
reimburse the United States for expenses (covered into
miscellaneous receipts)
Less one-half of 1 per cent deduction on awards under
agreement of Dec. 31, 1928 (held pending disposition by
Congress of recommendation of President to pay over to
Germany to meet its expenses on late claims)
Net payments made to claimants up to Oct. 31,1929_ _
3. Balance due on account:
Principal of awards
' ..
.
Interest to Jan, 1, 1928, at rates specified in awards
Accrued interest at 5 per cent from Jan. 1, 1928, on total
amount payable as of Jan. 1,1928, to Oct. 31,1929_.:
Balance due claimants as of Oct. 31, 1929
Class I
Class II
Class III
Total
Awards on acnumber Total amounts Number count
of death Number
Awards of
Number
Awards over
of awards
of awards and personal in- of awards $100,000 and less of awards
$100,000
jury
4,672
$113,295,478.68
116,926.32
113,178, 552. 36
49,977,397.45
163,155,949.81
410
9,916,607.87
173,072, 557.68
4,273
83,186,243.72
7,166, 248.02
408
3,458, 687. 75
726,394. 66
4,185,082.41
$14,413,325. 58
48,012.50
'14,365,313.08
6, 531,773. 92
20,.897,087.00
99,168.53
4,284, 250.94
646,883.34
21,643,970.34
9,170,556. 00
147,244,336.40
o
14,160, 703.31
6,441,103.49
1 65, 572,852. 66
H-
$3,458,687.76
3,452, 687. 75
725,144. 63
3,967
3,865
. 98,619.49
4,276,451. 77 _i_
726,779.63
91,079,27L 37
21,382.27
455,283.20
295
$95,423,465. 35
68,913. 82
95,354,351. 53
42, 719,228.87
138,073, 780 40
O
628,160.14
21,229,966.94
65,572,852.66
106,036.43
327,864. 60
M
Q
ZP
113.81
113.81
90, 623,874.36
399
72,711, 537. 51
91,920. 56
9,189,828. 24
81,993,286. 31
4, 255,069. 50
2
6,000.00
1,250.13
549.04
7,799.17
21,123,816. 70
102
204,609. 77
90,670. 43
18,723.20
314,003.40
65,244,988.16
295
72,500,927. 74
9,170,656.00
81,671,483. 74
1 Payments on this class of awards are first applied on account of the total amount payable as of Jan. 1,1928, as directed by the settlement of war claims act of 1928, until total of
all payments on the three classes equals 80 per cent of the amount payable Jan. 1, 1928. This amount represents payments of $100,000 and additional 30 per cent, 10 per cent and 7
per cent on account to each claimant (less one-half of 1 per cent). Payment of accrued interest since Jan. 1,1928, on this class of claims deferred in accordance with act.
W
SECRETARY OF THE TREASURY
73
Of the above-mentioned awards certified to the Treasury for payment, 189, in the aggregate amount of $19,950.98, to which should be
added interest up to October 31, 1929, of $4,694.07, total $24,645.05,
were allowed under the agreement of December 31, 1928, authorized
by the settlement of war claims act of 1928. One hundred and
seventy-three of these late claims, amounting to $18,430.98, together
with interest to the date of payment in the sum of $4,338.42, total
$22,769.40, have been paid in full. The net payments to claimants
amounted to $22,655.59, after deducting one-half of 1 per cent for
expenses of administration amounting to $113.81.
The following statement shows the funds deposited in the German
special deposit account and the payments made therefrom up to
October 31, 1929:
Receipts:
Unallocated interest fund
$25, 000, 000. 00
Appropriation for ships, patents, and
radio station
50, 000, 000. 00
Receipts from Germany—
2}i per cent of
Dawes' annuities • available
"
for reparations-_ $32, 183, 051. 47, , .
U n d e r so-called
Young plan
2, 782, 891. 04
•
34,965,942.51
Investments of Alien Property Custodian under sec. 25 of trading with the
enemy act, as amended
9,500,2.77.44
;
Earnings and profits on investments
2,624,794.05
$122, 091, 014. 06
Payments:
On account of the
. .'
awards of the Mixed
Claims Commission
as shown in above
statement—
Under agreement
of Aug. 10,1922. $90,601,218.77
Under agreement
of Dec. 31, 192822, 655. 59
90,623,874.36
One-half of 1 per cent deduction from
payments (covered into miscellaneous
receipts)
455, 2B3. 20
One-half of 1 per cent deduction from
payments on account of awards made
under new agreement (held pending
disposition by Congress of recommendation of President, $113.81)
-Advances for expenses of Treasury
(limited to $25,000 per annum)
13, 175. 00
74
REPORT ON THE FINANCES
Payments—Continued.
Advances to war claims arbiter for expenses
_._--___
$61, 600. 00
$91, 153, 932. 56
Balance available in German special deposit account
(including investments)Made up as follows (principal costs)—
$9,641,200 face amount of fourth Liberty loan 4J4 per
cent bonds
$5,145,000 face amount of 4:% per cent Treasury
certificates. Series Td2-1929—
-.-_
$3,083,500 face amount of 4>^ per cent Treasury
certificates. Series Td-1929
^
$12,646,500 face amount of 4% per cent Treasury
certificates. Series TJ-1930
Accrued interest paid on investments when purchased but not yet collected
-_
Cash balance
30, 937, 081. 44
9,981,654 87
5, 145, 282. 77
3, 081, 386. 89
12, 646, 500. 00
44, 827. 71
37, 429. 20
30, 937, 081. 44
Of the above-mentioned balance, the sum of $25,000,000 is reserved
to make payments on account of the tentative awards of the war
claims arbiter for ships, patents, and a radio station belonging to
Gernian nationals and seized by the United States during the war.
The remaining balance will be used to make payments on account
of the awards of the Mixed Claims Commission. It is the policy of
the department to aUow funds to accumulate,in this account until a
sufficient amount over and above the $25,000,000 is available to
enable it to make an additional payment of not less than 5 per cent
of the amount remaining unpaid as of January 1, 1928, on account
of the awards over $100,000.
Austria
Section 25 (g) of the trading with the enemy act, as amended by
the settlement of war claims act of 1928, reads in part as follows:
The Alien Property Custodian is authorized and directed (after the payihent
of debts under section 9) to transfer to the Secretary of the Treasury, for deposit
in the special deposit account (Austrian or Hungarian, as the case may be),
created by section 7 of the settlement of war claims act of 1928, all money and
the proceeds of all property, including all income, dividends, interest, annuities,
and earnings accumulated in respect thereof, owned by the Austrian. Government or any corporation all the stock of which was owned by or on behalf of the
Austrian Government (including the property of the Imperial Royal Tobacco
Monopoly, also known under the name of'K. K. Oesterreichische Tabak Regie)
or owned by the Hungarian Government or by ariy corporation all the stock of
which was owned by or on behalf of the Hungarian Government.
SECRETARY OF THE TREASURY
75
Under the provisions of this section the Alien Property Custodian
transferred to the Secretary of the Treasury for deposit in the Austrian special deposit account the sum of $1,449,119.29 to which should
be added the sum of $43,727.55 representing earnings and profits on
investments of the Secretary of the Treasury, maldng the total amount
of $1,492,846.84 available. Out of these funds the Treasury has
made payment up to October 31, 1929, in the amount of $362,317.27
on account of the awards of the Tripartite Claims Commission against
Austria, from which was deducted $1,811.60, representing one-half
of 1 per cent fqr reimbursement to the United States on account of
expenses incurred, making net payments to claimants of $360,505.67.
The total amount of awards, including interest, certified by the
commissioner to the Treasury for payment was $370,032.14. As
practically all of the awards against Austria had been paid, the
Treasury, after reserving sufficient funds to provide for the few
remaining unpaid awards, returned on August 22, 1929, to the
Austrian Government the sum of $1,122,814.70, which was not
needed for the purpose for which it was deposited in the Austrian
special deposit account. A copy of letter dated August 22, 1929, to
the Austrian Minister at Washingon, together with copies of the
statement therein mentioned, and a copy of the press release of same
date will be found as Exhibits 35 and 36, pages 338 and 356 of
this report.
The following statement shows the funds deposited in the Austrian
special deposit account and the payments made therefrom up to
October 31, 1929:
Receipts:
Alien Property Custodian—
Account of Austrian Government
$168,064.93
Account of Imperial Austrian Tobacco
Monopoly
>
1, 030, 849. 57
Income and earnings thereon
250, 204. 79
•
$1, 449, 119. 29
Earnings and profits on investments of funds in this account43, 727. 55
. Total available in Austrian special deposit account.Payments:
On account of the awards of the Tripartite
Claims Commission
$360,505.67
One-half of 1 per cent deduction from payments (covered into miscellaneous receipts)
J
1,811.60
Returned to the Austrian Government
1,122,814. 70
Total payments up to Oct. 31, 1929
Cash balance---
-
1, 492, 846. 84
1,485,131.97
7,714.87
76
REPORT ON THE FINANCES
Hungary
Section 25 (g) of the trading with the enemy act, as amended,
quoted above under Austria, also authorizes and directs the Alien
Property Custodian to transfer to the Secretary of the Treasury for
deposit in the Hungarian special deposit account, created by the
settlement of war claims act of 1928, all money and proceeds of
property, including earnings thereon, owned by the Hungarian
Government or any corporation, all the stock of which was owned by
or on behalf of the Hungarian Government. The Alien Property
Custodian has advised that the funds and property in his hands
which will be available for this purpose represent an insignificant
amount. The amount of the awards, including interest, made by
the Tripartite Claims Commission against Hungary wUl amount to
approximately $175,000. The sum of $8,250 has been deposited by
the Hungarian Government in the Treasury in partial satisfaction of
the awards rendered against it by the Tripartite Claims Commission.
The commissioner of the Tripartite Claims Commission has not yet
certified to the Treasury for payment any awards against Hungary
as required by the settlement of war claims act of 1928. Under the
settlement of war claims act of 1928, no payment can be made on
account of these awards until the Commissioner of the Tripartite
Claims Commission has certified to the Secretary of the Treasury
that the amounts deposited in the Hungarian special deposit account
are sufficient to make the payment authorized in respect of such
awards. I t is hoped that sufficient funds will shortly be deposited
with the Treasury to enable it to make paynient in full of these
awards and which will at the same time place the Alien Property
Custodian in a position where he can return the property of the
Hungarian nationals held by him as contemplated by the settlement
of war claims act of 1928.
War Claims Arbiter
Under the settlement of war claims act of 1928, it is the duty of the
war claims arbiter, wdthin certain limitations, to hear the claims of
German nationals and to determine the fair compensation to be paid
by the United States for ships seized by it, a radio station sold to the
United States, and patents sold or used by the United States. No
awards on account of these claims have yet been certified by the
arbiter to the Treasury for payment.
THE PORTO RICAN HURRICANE RELIEF COMMISSION
On September 13 and 14, 1928, one of the worst West Indian hurricanes of which there is any record, swept over Porto Rico, causiiig
property damage estimated on the basis of careful and detailed surveys
of approximately $85,000,000. The severity of the damage can be
SECRETARY OF THE TREASURY
77
better appreciated when it is recalled that this loss occurred on an
island which is only approximately 100 miles long and about 35 miles
wide. That the number of lives lost was something under 300 was
due to the fact that accurate and timely forecasts of the storm were
conveyed throughout the island, the police notifying even the many
living in isolated sections not reached by the usual forms of communication.
The damage being so great as to make it impossible for the insular
government to give adequate rehef in the emergency. Congress by an
act approved December 21, 1928 (Public Resolution No. 74, 70th
Cong.) established the Porto Rican Hurricane Relief Commission,
composed of the Secretary of the Treasury, the Secretary of War, and
the Secretary of Agriculture, the Secretary of War being designated
chairman. By the terms of this resolution. Congress authorized the
appropriation of $6,000,000 to be used by the commission in making
loans to individual Porto Rican farmers. Congress further authorized
to be appropriated the sum of $2,000,000 ^Ho be used for the rebuilding
and repair of schoolhouses damaged or destroyed by the hurricane in
the sinall towns and rural districts of Porto Rico and for the employment of labor and the purchase of materials for repairing insular and
rural municipal roads.'^ The resolution also authorized the appropriation of $100,000 ^'to be expended by the commission in the purqhase and distribution within the devastated area of Porto Rico of
seeds and seedlings * * *.''
In January, 1929, a committee representing the commission
visited Porto Rico in order to ascertain what measures should be
taken by the commission to render its assistance most effective.
Under the plan formulated by this committee and adopted by the
commission a board of alternates composed of three members was
appointed in Porto Rico to carry out the work under the direction
of the commission.
As a part of its relief work, the Red Cross employed during the
month of January, 1929, an average of about 25,000 laborers in clearing coffee farms. In order that there might be a minimum of unemployment, the commission planned its repair and rebuilding of roads
so that as the Red Cross gradually completed its program of clearing
the coffee farms and wound up all its relief activities, the laborers
might be transferred to road work in the same districts as were
located the coffee farms on which they had been working. The commission further planned that as the road work was completed, the
loans which in the meantime it was making to farmers would enable
them to hire the men for further work on the coffee plantations.
Of the $2,000,000 appropriated for the rebuilding and repair of
roads and schoolhouses, approximately $600,000 was allotted to
road work. This figure was arrived at after first ascertaining th^at.
78
REPORT ON THE FINANCES
approximately $1,400,000 would provide for the repair and reconstruction of schoolhouses, employing a standard of construction which
the commission and the authorities in Porto Rico deemed adequate.
This standard represents a genuine advance over that employed in
the schoolhouses which were destroyed or damaged.
Under the terms of the appropriation, $3,000,000 has been made
available prior to January 1, 1930, for loans. Down to October 1,
1929, applications for loans in the aggregate amount of $2,607,276
had been approved. In addition to the direct benefit from these
loans in the rehabffitation of agriculture, Porto Rican farmers wffi
derive from them several very important subsidiary advantages.
Rural land titles in Porto Rico have been in a very chaotic state,
many farmers who actually owned the land havuig no way to prove
their titles and lacking the funds to defray the very considerable
expense involved in having the proper legal record made. One of
the conditions fixed by the commission for making a loan is that the
title of the land to be rehabffitated should be properly recorded.
At the instance of the commission the Porto Rican Legislature passed
special legislation which enables any farmer applying for a loan
from the commission to have the title of his land properly recorded
free of charge. Other incidental advantages to agriculture include
the requirement that all the seeds to be planted on land being rehabilitated with the aid of money borrowed from the commission be
from selected seed beds and of a standard approved by both the
Federal and insular Departments of Agriculture. The planting and
cultivating of the crops on farms which are receiving commission
aid will be done under constant supervision of representatives of these
agriculture departments until the loan has been repaid. And lastly,
the farmers will be required to cultivate their vegetable gardens,
thus contributing to the health of the inhabitants of the island as
well as to substantial economies in the family budget.
BUREAU OF CUSTOMS
The increase in customs in 1929 was due to both the general import
situation and the trade situation affecting important customs-producing commodities. The general trade situation is summarized by
fiscal years in the.following table:
Merchandise exports and imports, the trade balance, and customs collected, fiscal
years 1924-1929
[In millions of dollars]
Exports
1924
1925
1926
1927
19^9
4,312
4,865
4,753
4,968
4,877
5,374
Imports
3,654
3,824
4,465
4,252
4,148
4,292
Excess of
exports •
over
imports
758
1,040
289
716
730
1,082
Customs
collected,
645
549
580
606
568
603
79
SECRETARY OF THE TREASURY
The significant features of the trade situation in recent years are
the decline in trade balance in 1926, due to the unusual increase in
imports, and the increase in the trade balance in 1929 to the highest
point since 1921, due to the marked increase in exports. The
changes in imports have resulted from changes in the volume and
the prices of commodities imported.
The high prices of certain dutyrfree imports in 1926 and the decrease
in their prices in subsequent years are responsible in a considerable
degree for the changes in total value of all imports. For example,
the high price of crude rubber during the fiscal year 1926 was responsible for the greater proportion of the increased value of total imports
of that year and the subsequent decline in its price was a factor in the
decreased import values in the three following years. Duty-free
imports have constituted between 64 and 66 per cent of the value of
total imports for consumption during the last four years, as compared
with less than 60 per cent in 1924 and 1925, the preceding years
under the present tariff rates.
Total imports for the fiscal year 1929 increased somewhat over
1928, due to increases in the value of manufactured and semimanufactured products. The quantity of copper imported increased by
two-fifths at increased prices, and vegetable oils increased approximately one-third. Most of the leading manufactured imports
showed increases. Imports of crude materials declined further in
value as compared with the preceding year, largely as a result of the
continued depression in prices which has prevailed for certain important products since 1926. The total for crude foodstuffs showed
relatively little change. Manufactured foodstuffs increased slightly
in value, increases in a variety of products offsetting a large decrease
in the value of sugar imports.
Looking at imports from the point of view of Government customs
revenue, the six leading sources are cane sugar, unmanufactured
tobacco, wool and mohair, manufactures of wool, manufactures of
cotton, and manufactures of silk. The tariff on, these items produces
half the customs, while the imports of these commodities are less than
15 per cent of the total imports. The changes in the imports of these
chief customs-producing commodities during the fiscal year 1929 as
compared with 1928 are shown below:
Quantity (in
millions)
Sugar, cane
Tobacco, unmanufactured
Wool and mohair
Wool manufactures, including y a r n s . . .
Cotton manufactures, including yarns.
Silk, manufactured
1928
1929
Pounds
Pounds
9,505
79
271
81
248
Per cent increase
Value (in millions) (-}-)
or decrease (—)
1928
1929
$234.6
58.8
79.4
82.7
68.0
42.5
$212,6
55.8
86.6
80.1
71.6
40.2
Quantity
-+-17. 5
-2.3
-{-9.3
Value
-9.3
-6.1
-f9.0
-3.1
-f6.3
-5.4
80
:
REPORT ON T H E FINANCES
The volume of the work (Connected with the customs laws can not
be measured by receipts. Commodities which are free of duty require
entry as well as those on which duties are paid and involve almost as
much work on the part of the customs officers and employees. The
number of entries during a year, therefore, are a better indication of
the volume of work. During 1929 a total of 3,175,144 customs entries
of various classes were filed, an increase of 95,412 over the number
filed during the fiscal year 1928. The number of vessels entered and
cleared also showed a decided increase over the previous year, a
total of 122,230 having been entered and 91,324 cleared, increases
of 38,747 and 7,098, respectively, over the preceding fiscal year.
International highway traffic continued to show a steady increase,
the number of automobiles and other vehicles entering the United
States during the fiscal year 1929 exceeding that for the fiscal year 1928
by 622,712. The total number of automobiles and other vehicles
entering the United States through the several ports on the northern
and southern border amounted to 11,736,008. The number of persons
who entered the United States across the border was 33,426,554 as
compared with 11,304,077 passengers who entered at the seaports.
The enforcement activities of the service also show increased
results over the previous year. The total appraised value of seizures
of all kinds amounted to $5,594,707 for the fiscal year 1929, an increase of $1,246,142 over the fiscal year 1928.
The new appraiser's stores at the port of New York, the construction of which was commenced during the preceeding fiscal year^
was completed and occupied in February, 1929. The facilities provided by this 12-story building, with a floor space of over 1,000,000
square feet, with unloading platforms under cover accommodating
^56 motor trucks, and equipped with the most modern mechanical
devices for the handling of merchandise, will insure not only the more
expeditious handling and examination of merchandise, but a better
protection to the revenue. The building formerly used, at 641
Washington Street, is being utilized for housing other Government
activities.
Under the authority contained in the sundry civil act of August 1,
1914, four new ports were established, namely, Oakland, Calif.;
Longview, Wash.; Tulsa, Okla.; and Lincoln, Nebr. Under the provisions of the same act, three ports were discontinued, namely,^
St: Yincent, Minn.; French ville. Me.; and Roche Harbor, Wash.
The development of commercial aviation required the designation
as airports of Key West and Miami, Fla.; St. Paul, Minn.; Seattle,
Wash.; San Juan, P. R.; New York, Buffalo, and Albany, N. Y.;
Los Angeles and San Diego, Calif.; Newark, N. J.; and Detroit,
Mich. Temporary permission was also granted to land aircraft at
Akron, Ohio; Brownsville, Tex.; Nogales,. Ariz.; and Derby, Vt.
81
SECRETARY OF THE TREASURY
In addition to the regular customs business, special work was
done during the year in connection with the administrative provisions
for a new tariff act. A committee was formed in the department to
study the administrative provisions now in force and to suggest
such additions and amendments, as seemed advisable for a better
administration of the customs business.
A committee of field and bureau representatives was also engaged
during the greater part of the year in studying the various positions
of customs field employees, and in preparing titles, specifications
and compensation schedules. This involved the detailed study of
approximately 9,000 positions. The specifications and schedules
were transmitted to the Personnel Classification Board for consideration in connection with its report under the act of May 28, 1928, to
the Congress on the classification of field employees.
COAST GUARD
The principal operations of the Coast Guard during the fiscal year
1929 exceeded those of the preceding year. A comparison of the
principal.operations during the fiscal years 1928 and 1929 follows:
Operation
1928
Lives saved or persons rescued from peril
Persons on board vessels assisted
Persons in distress cared for
.:
Vessels boarded and papers examined
Vessels seized or reported for violations of law
Fines and penalties incurred by vessels reported
Regattas and marine parades patrolled
_
Instances of lives saved and vessels assisted
1
Instances of miscellaneous assistance
Derelicts and other obstructions to navigation removed or
destroyed
._
Value of derelicts recovered and'deliyered^to owners.
Value of vessels assisted (including cargoes)
Persons examined for certificates as lifeboat m e n . . .
Increase
(4-) or decrease (—)
1929
3,983
17,383
4, 376
18, 725
690
879
65. 710
1,654
$279, 510
80,263
2,571
$424,725
84
3,262
3, 584
104
4,419
4,867
167
267
• $103,520
$39,479,729
4,261
$38, 200
$49,128, 375
4, 271
H-392
-f-1,342
+189
+14,553
+1,017
+$145, 215
+20
+1,157
+1, 283
+100
-T$65, 320
+$9, 648, 646
+10
A very commendable record of service discipline was made, and
the percentage of men reenlisting upon expiration of enlistments
continued to increase.
The duties of the Coast Guard in connection with the enforcement
of the customs laws of the country and of the navigation and motor
boat laws were satisfactorily performed. The law-enforcement
work for the prevention of smuggling of liquor into the United States
from the sea continued to be satisfactory. Some liquor smuggling is
still going on along the seaboard and there remains a considerable
amount of such smuggling on the Great Lakes. The service is doing
all that is,possible with its present resources, but the matter continues to be one requiring utmost vigilance and attention.
71799--30—FI 19 2 9
8
82
REPORT ON THE FINANCES
In March, 1929, the Coast Guard was called into action during a
disastrous flood in Alabama, Georgia, Florida, and a small section
of Mississippi. Acting in, cooperation with the Red Cross, the
State and local authorities, the Army and citizens, the Coast Guard
sent personnel and boats into the flooded areas up the Choctawhatchee River, and aided in rescuing individuals, in transporting
them to places of safety, in delivering supplies, in setting up means
of communication, and in other forms of relief work.
On May 1, 1929, the first link was established in the coastal checking system, designed to assist aircraft using coastal routes, and in
particular to note the departure and arrival of aircraft making
extended flights over the coastal estuaries./ Through this system
any pilot or owner may have a plane or planes under almost constant
observation from New York to Miami, Fla., if such planes follow the
coastal route, and in case of accident may be assured of prompt
assistance from the nearest Coast Guard station. This service has
been developed without additional cost to the Government. Such
a service is of great value, and with the growth of commercial aviation its extension to the entire coast line of the country would be
advisable.
During the year, 5 of the 10 cutters authorized by the act of
June 10, 1926, were completed and placed in commission. Contract
was entered into for the construction and equipment of 3 more of the
10 cutters and the work is progressing satisfactorily. Preparations
have been made to commence the ninth of the 10 cutters. The design
plans and specffications are under way.
The Secretary of the Treasury awarded during the year 57 lifesaving medals of honor and one second service silver bar in recognition of bravery displayed in the rescue, or attempted rescue, of persons from drowning in waters over which the United States has
jurisdiction, or upon an American vessel.
BUREAU OF ENGRAVING AND PRINTING
Not since the war has the Bureau of Engraving and Printing been
as active as during the fiscal year 1929. This year marks the transition in the inanufacture of paper currency from the old to the new
size. The deliveries of all classes of work during the year amounted
to 529,742,699 sheets, as compared with 483,455,932 for the previous
year, an increase of over 9.57 per cent.
On August 6, 1928, the first impressions of the new-size currency
were printed. As new plates became available for print, they were
immediately sent to press and plates of the old size were dropped.
The old-size printings of backs and faces ceased on November 1 and
December 15, 1928, respectively. The printed impressions of the
SECRETARY OF THE TREASURY
83
new-size notes were stored in the vaults for seasoning and held until
all old-size currency had been passed through the numbering, sealing,
and separating operation. In the meantime the new machines were
installed. The numbering anci sealing process was gradually shifted
from the old to the riew size. The change in the numbering division
was one of the most difficult problems, because a shift was necessary
from the old machines of the 4-subject type to the new machines of
the 12-subject type involving new principles of operation.
The great bulk of the new notes were numbered and sealed during
the last three months of the yea'r so that it was necessary to increase
the personnel for that period. Two shifts of workers operated in
the numbering division from early March until June 30, increasing
the force from 400 to more than 1,000 employees.
Immediately after the announcement on January 12, 1929, of
the inclusion of national-bank notes in the small-size currency, work
began on designs for these classes. The new designs vary from the
old in that the portrait has been placed in the center of the note
instead of at the left side. The name of the bank is no longer engraved on the plate but is typographically printed on the sheet after
the plate-printing operation. This change wffi be of a material
assistance to the bureau. Under the old plan, there was an engraved plate for each national bank, making it necessary to withdraw a particular plate for printing for each bank. Stocks of backs
and faces are now printed and stored in vaults, the name of the bank
and signature being overprinted when notes are ordered.^ This new
procedure will reduce materially the work involved in producing
such notes.
PROHIBITION LAW ENFORCEMENT
During the past year the organization of the Bureau of Prohibition
has been completed in accordance with the act of March 3, 1927.
All field offices were surveyed and set up to operate with maximum
efficiency. Field positions have all been graded in conformity with
the provisions of the classification acts. With the exception of a
comparatively small number of agents, aU positions of the bureau
have been brought within the classified civil service. It is anticipated
that examinations and certifications of the Civil Service Commission
will permit the appointment of all agents under civil service laws
within a short time.
The instruction of agents in the proper and lawful methods of
operation was carried forward during the year by experts. The
lecturers and instructors visited practically every administrative
district in the United States, and gave instruction at 22 different
places. About 750 agents, mostly new recruits, attended the lectures.
All agents now have specific instructions regarding the rights of
84
REPORT ON THB FINANCES
citizens I as guaranteed by the fourth and fifth amendment? of the
Constitution, the proper method of securing search warrants and
executing them, and the technique of making investigation of the
larger and more important cases, and the proper form of writing a
report.
Prohibition agents made 66,878 arrests duiing the fiscal year
and seized 7,299 automobiles, valued at $2,879,013, and 89 boats,,
valued at $260,845. Federal agents also made arrests, or assisted
in obtaining evidence, in a large number of cases against individuals
prosecuted in State courts.
The policy of limiting the production of industrial alcohol to the
actual need of legitimate industry, initiated January 1, 1928, has
proved successful. The program of allotting to each industrial
alcohol plant a fixed quota of the total alcohol to be produced for
the year has proven of great benefit to the alcohol industry by preventing overproduction and consequent unstable conditions. This
policy has also been an important factor in reducing the diversion of
alcohol for illegal purposes.
There has been a substantial increase during the past fiscal year
in the quantity of completely and specially denatured alcohol manufactured, which can be readily accounted for on account of the
following facts: An increase of several million automobiles registered
in the United States has required additional millions of gallons of
completely denatured alcohol for antifreeze purposes and a tremendous quantity of specially denatured alcohol to furnish lacquers,
which are now used exclusively in finishing automobiles. There hasbeen an expanding market for lacquers manufactured from specially
denatured alcohol to finish furniture and the interior of residences.
The tremendous expansion of the rayon industry has required additional millions of gallons of specially denatured alcohol. The growth
and expansion of chemical industries has also required more alcohol,,
which is the basic raw material used in thousands of preparations
and processes.
Substantial results are being secured in the modification of t h e
formulae for specially denatured alcohol, which is being studied in t h e
Washington laboratory. Weaker specially denatured alcohol for^
mulse have been ehminated from use in certain lines of industry, thus
assisting the legitimate industry to secure alcohol better adapted t o
its needs. Completely denatured alcohol several years ago was a
source of considerable illicit liquor, but this diversion of completely
denatured alcohol for beverage purposes has practically ceased.
Another interesting development during the year was the experimental production of alcohol from ethylene gas. This synthetic
product on a commercial scale will assure a sufficient supply of
SECRETARY OF THE TREASURY
85
alcohol if production by the fermentation of molasses and grain
should become limited.
The operations of the Treasury Department in the enforcement of
prohibition are becomiag stable and more effective. The activity
and cooperation of the several bureaus engaged in these operations
are making the business of violating prohibition laws more difficult
and hazardous.
NARCOTIC LAW ENFORCEMENT
Importations of narcotic drugs are limited by law to those quantities of the crude materials necessary for medical and legitimate uses.
Of the total quantity of narcotic drugs manufactured legitimately
in this country, the portion diverted to illicit channels is sufficiently
small to render unimportant the problem of absolute prevention of
such diversion as compared with the problem of preventing the unlawful importation of narcotic drugs from abroad. Smuggling and
subsequent selling of opium, morphine, heroin, and cocaine continue
to constitute the principal enforcement problem. These drugs,
evidently readily purchasable in Europe and Asia, become the
principal source of supply for narcotic drug addicts in this country.
There is thus indicated the necessity for constantly increasing efforts
to detect and prevent the unlawful introduction into the Umted
States of narcotic drugs from abroad.
On June 30, 1929, there was a total of 323,982 registrations under
the Harrison narcotic law, as amended, 291 as importers and manufacturers, 1,751 as wholesale dealers, 51,568 as retail dealers, 146,588
as practitioners, and 123,784 as dealers in and manufacturers of
untaxed narcotic preparations, the latter number including registrants
not required to pay special tax by reason of paying another tax under
the act.
Enforcement activities during the year resulted in the conviction
of 5,193 for violations of the Federal narcotic laws and a total of
83,789 ounces of narcotic drugs was seized or purchased as evidence,
73,080 ounces of which were opium and the remainder morphine
heroin, and cocaine.
The scope of the agreement, mentioned in last yearns report, for
the direct exchange of evidence and information between the Federal
Narcotic Unit and the corresponding departments of a number of
foreign governments concerning persons engaged in the ifficit traffic
in narcotic drugs, has been enlarged by the adherence to this arrangement of four additional European Governments, Denmark, Turkey,
Portugal, and Rumania. The fullest cooperation of members to this
agreement is sought so that illicit sffipmentsof narcotic drugs to the
United States may be materially reduced if not entirely prevented.
86
REPORT ON THE FINANCES
PUBLIC HEALTH SERVICE
The outstanding public-health event during the year was the
epidemic of influenza, which reached its height about the 1st of January. Comparatively few cases of influenza were reported in 1928
until the spring months, when there was an increase instead of the
usual decrease in the incidence of the disease. Late in October
a sudden increase occurred in the number of cases in some cities on
the Pacific coast and the disease soon involved the Pacific and Mountain States and extended rapidly eastward. The greatest number
of cases in the country as a whole was reported about the close of
1928, although at that time the disease was decreasing in the West.
In general, the disease was much less virulent than during the pandemic of 1918, but the general death rates in some localities rose to
several times the normal. During January and February the number of cases reported decreased rapidly, and conditions were about
normal before the last of March.
With respect to other diseases, hea,lth conditions generally were
relatively good during the year. Diphtheria and typhoid fever both
recorded new low records for the calendar year 1928, and havebeen
decreasing in prevalence for more than a quarter of a century. Meningococcus meningitis (epidemic cerebrospinal meningitis) has been
increasing in the United States for several years, the rates for 1928
being the highest since 1918. There has been an increase in the
prevalence of pellagra during the last few years, and in 1928, 6,652
deaths from this disease were reported to the Public Health Service
by 43 States. The incidence of infantile paralysis in 1928 was about
half that for 1927, and the number of cases reported during the first
six months of 1929 was considerably less than for the corresponding
period of 1928. The lowest annual tuberculosis death rate ever
recorded by the Public Health Service was 77.4 per 100,000 population
for the calendar year 1928, a rate about two-fifths of that prevailing
at the beginning of the present century. More than 38,000 cases of
smallpox were reported in 43 States in the calendar year 1928. For
several years the United States has had the unenviable distinction of
reporting more cases of smallpox than any other country in the
world except India. Cholera or yellow fever did not appear in the
United States during the fiscal year, but there were two cases of
bubonic plague in California during the summer of 1928. The source
of infection was probably ground squirrels.
During November, 1928, vessels began to arrive at Pacific coast
ports from the Orient with cases of meningococcus meningitis (epidemic cerebrospinal meningitis) among the steerage passengers.
The number of cases on board increased so rapidly as the winter
season advanced that the ^available facffities of the local health
authorities at the ports of San Francisco and Seattle became over
SECRETARY OF THE TREASURY
87
taxed, and the Public Health Service was requested to extend the use
of the Federal quarantme stations at these ports. By early spring
the quarantine facffities of both the local and Federal health authorities were overburdened. This resulted finally in the promulgation
of Executive Order No. 5143 of June 21, 1929, providing temporary
restriction and supervision of transportation of passengers from ports
in China and the Philippuies to United States ports under regulations prescribed by the Secretary of the Treasury. Notwithstanding
the more favorable climatic conditions of the summer season, cases
of this disease contiaue to arrive at Pacific coast ports, and it is probable that only strict enforcement of this Executive order will meet
the situation another winter.
During the fiscal year the prevalence of yellow fever increased
along the east coast of South America between the mouth of the
Amazon River and Rio de Janeiro. It finally became so serious that
an officer of the Public Health Service was detailed in each of the
American consulates at Buenos Aires, Argentina, and Rio de Janeiro,
Brazil, to prevent the transportation of the infection by vessels destined for ports in the United States. Near the close of the fiscal year
the disease was reported to have spread to Magda:lena River ports in
Coloiribia, Socorro in the interior being most affected. Because of
the close maritime relations with Colombia, the dangers of the possible introduction of yellow fever into the United States are increased.
At the close of the fiscal year negotiations for a reciprocal quarantine arrangement between the Government of the United States and
the Dominion of Canada were being perfected, whereby vessels from
foreign ports, entering the international waters of Puget Sound on
the Pacific coast or the Great Lakes via the St. Lawrence River on
the Atlantic coast, that call at ports of both countries would be subjected to but one quarantine inspection. This agreement is in
accord with the provisions of articles 56 and 57 of the International
Sanitary Convention of Paris, 1926; and such an arrangement would
greatly facilitate the movement of shipping.
At the May, 1928, meeting of the health committee of the League
of Nations held in Paris, a commission on ship fumigation was
appointed, of which the Surgeon General of the Public Health Service
is chairman. The purpose of this commission is to make a detailed
study of certain problems relating to the fumigation of ships by means
of hydrocyanic acid gas for the prevention of the introduction of
plague. These research studies are progressuig at the New York
quarantine station.
The county health unit plan of applying practical public health
knowledge has been receiving wider interest and attention as its
benefits become more generally recognized. The success of county
health units in meeting the health emergencies of the Mississippi
88
REPORT ON THE FINANCES
flood in 1927 has attracted the attention of health authorities throughout this country and abroad. There appears to be no doubt that
such local health units provide the machinery through which all
public health activities may be conducted in proper sequence and in
proper relation one to the other, thereby insuring to communities a
well-balanced, general program of public health work. This plan
also affords the best possible means for preventing the intrastate and
interstate spread of disease.
Various investigations are being pursued and publications issued.
During the winter months, the Public Health Service collected nationwide statistical information regarduig the incidence, mortality, and
geographical distribution and spread of influenza with a view to
learning more of its method of spread through populations, its clinical
manifestations, and related problems. Evidence collected indicates
that undulant fever has existed in considerable numbers of persons
and over a wide geographical area for a long time without bemg
recognized. Investigations made include the collection of clinical
and epidemiological data to determine its significance and if possible
to devise improved methods of prevention. Studies have been
undertaken at the Hygienic Laboratory to improve the therapeutic
efficacy of the polyvalent sera used in the treatment of, epidemic
cerebrospinal meningitis, because of a considerable increase in the
prevalence and virulence of this disease.
For 131 years the Government has furnished medical care to disabled seamen as an aid in developing and encouraging the maintenance of American merchant ships. The marine hospitals and other
relief stations of the Public Health Service serve 155 ports in the
United States and the possessions, reflecting in some measure the
revival of public interest in American shipping and the effects of
recent legislation designed to develop a merchant marine. Other
important classes of beneficiaries are lepers, detained immigrants,
foreign seamen, jand patients of the Veterans' Bureau, Coast Guard,
Employees' Compensation Commission, Coast and Geodetic Survey,
Lighthouse Service, and the Bureau of Fisheries.
The marine hospital building program has been continued. The
new marine hospitals in Cleveland and Detroit are approaching
completion. Funds are available and plans are in course of preparation by the supervising architect for new marine hospital buildings
in New Orleans, San Francisco, Galveston, Baltimore, and New
York, and for a larger and better out-patient office in Philadelphia.
A marine hospital is also proposed for Seattle, where a site has been
donated by the city. A number of miscellaneous small projects are
contemplated to improve existing facilities at the marine hospitals
in Boston, Buffalo, Evansville, Louisville, Mobile, Pittsburgh, Key
West, Norfolk, Portland (Maine), Fort Stanton, and Carville, La.
SECRETARY OF- THE TREASURY
89
In the control of the venereal diseases impetus was given to further
research by the cooperative arrangement between the Pubhc Health
Service and the committee on research in syphilis whereby an officer
of the service acts as a technical adviser in connection with a coordinated program of research in which 15 of the leading scientific
institutions in this and other countries are participating.
An act approved January 19, 1929, and authorizing the establishment of two institutions for the confinement and treatment of persons
addicted to the use of habit-forming drugs, created within the office
of the Surgeon General of the Public Health Service a new administrative division known as the narcotics division, which is charged
with the responsibffity of managing these institutions, and with the
disciplinary problems and methods of treatment for those admitted.
The need for additional medical officers in the regular corps of the
service, set forth in my report of last year, is even more pressing than a
year ago. The Department of State desires to extend to 14 places in
Canada and Mexico the work of examining prospective immigrants
at American consulates in the country of origin, before the issuance
of immigration visas, and trained medical officers for this work are
not available. The present compensation of a medical officer in
the entrance grade of assistant surgeon is attracting a gradually
decreasing number of applicants with the required educational arid
professional qualffications.
TABLET COMMEMORATING
THE
WEBSTER-ASHBURTON
TREATY
A bronze tablet commemorating the signing of the WebsterAshburton treaty, placed on the northeast corner of the Treasury
Building, was unveiled with appropriate ceremonies on April 30,
1929. The inscription on the tablet is as follows:
Friendship between the United States and ^
Canada was developed and strengthened by
the signing of the Webster-Ashburton
Treaty, on August 9, 1842, in the old State
Department Building which stood on this
site. This treaty established the northeastern boundary between the two countries.
This tablet placed by
The Kiwanis Club of Washington in cooperation with the
Committee on Marking Points of Historic Interest
April 30, 1929
The treaty was executed by Lord Ashburton (Alexander Baring),
envoy of Great Britain, and Daniel Webster, representing the Government of the United States. It defined the boundary line between
Canada and the United States as far west as the Rocky Mountains,
90
REPORT ON THE FINANCES
and thus settled an international question which might have become
a cause of enmity between the two countries.
At the unveffing ceremony, Mr. O. Sam Cummings, Kiwanis international president, presented the tablet on behalf of that organization.
Response for Canada was made by Mr. Thomas A. Stone, undersecretary of the Canadian legation. Mr. John B. Hickerson, Assistant Secretary of Western European Affairs, represented the State
Department, and Undersecretary Ogden L. Mffis accepted the tablet
for the Treasury.
Attention is invited to the attached reports of the various bureaus
and divisions of the Treasury Department and to the exhibits and
tables accompanying the report on the finances.
A. ^W.
MELLON,
Secretary of the Treasury.
To
THE
SPEAKER OF THE H O U S E OF REPRESENTATIVES.
ABMINISTRATIVE EEPOETS OF
BUEEAUS AND DIVISIONS
91
ADMINISTRATIVE REPORTS OF BUREAUS AND
DIVISIONS
OFFICE OF THE COMMISSIONER OF ACCOUNTS AND DEPOSITS
Railroad obligations
The total receipts during the fiscal year on account of railroad
securities amounted to $15,473,795.82, of which $11,991,256.39 was
on account of principal and $3,482,539.43 was on account of interest.
The railroad securities have been gradually reduced each year until
the principal of the obligations on hand at the close of the fiscal year
under review amounted to only $62,698,691.99. The following statement shows the total amount of railroad obhgations by classes originally held, the amount held on June 30, 1929, and payments received
on account:
Principal
amount originally held
Federal control act:
Equipment trust notes
Section 7
Transportation act:
Section 207
_
Section 210
Total . -
$346, 556, 750.00
93, 401, 765. 00
Principal
amount held
on June 30,1929
Total payments received .
Principal
Interest
$201, 600.00
$346,355,150.00
93,401, 765.00
$45, 250, 800.93
23,354, 495.32
254,127, 891.00
290,800,667.00
6,112,300.00
57,384, 791.99
249,015,591.00
233,415,875.01
54,095,421.52
83,333,331.90
984,887,063.00
62, 698, 691. 99
922,188,371.01
206,034,049. 67
The equipment trust notes were reduced during the year by payments received from the Minneapohs & St. Louis Railroad Co.
Reductions have also been made during the past year in the obligations acquired under section 210 of the transportation act, 1920, as
amended, principally due to payments, amounting to about $10,600,000, received in full settlement of the obhgations of the Chesapeake
& Ohio Railway Co. and the Kansas City, Mexico & Orient Railroad
Co. For detailed statements of the obhgations held and payments
made on account of principal, see Tables 47-50, pages 516-518.
Section 204.—This section provides for reimbursement of deficits
of the so-called ^'short-line'' railroads during Federal control. Payments made by the Government to carriers during the fiscal year on
this account aggregated $11,671.24, making total payments to June
30, 1929, of $10,967,801.80, of which $9,046,412.99 has been paid to
carriers direct and $1,921,388.81 has been paid to the Director
93
94
'
REPORT 5 N T H E F I N A N C E S
General of Railroads on account of amounts certified to be due from
the carriers to the President as operator of the transportation systems
under Federal control. For detailed statement of payments made,
see Table 47, page 516. .
Section 209.—This section provides for the guaranty of net railway
operating income during the six months' period immediately following
the termination of Federal control on March 1, 1920. During the
fiscal year there was paid to the carriers on this account the sum of
$6,811.18, which, after deductmg repayments of $5,329.22 made during
the fiscal year by carriers on account of overpayments under this
section, makes the total net payments $531,707,117.13 to June 30,
1929. The following carriers are stffi indebted to the United Stateis
on account of overpayments made under the provisions of paragraphs
(g) and (h) of this section:
Fort Dodge, Des Moines & Southern R. R..Co
$59, 288. 44
Great Northern Ry. C o . .
.
1, 329, 785. 98
Minneapolis & St. Louis R. R. Co., receiver
292, 022. 23
Missouri & North Arkansas R. R. Co., receiver
41, 375. 46
Oregon Electric Ry. Co. (subsidiary Spokane, Portland & Seattle
Ry. Co.)
25, 741. 83
Spokane, Portland & Seattle Ry. Co
104, 273. 48
1, 852, 487. 42
In some cases these claims are,in litigation and the others have
been placed in the hands of the Attorney General of the United States.
For a detailed statement showing partial and final payments to
carriers and amounts received from carriers, see Table 49, page 517.
Section 210.—This section established a revolving fund of $300,000,000 to be used for loans to railroads under the conditions set forth in
a certfficate of the Interstate Commerce Commission authorizuig each
loan, and.also for paying judgments, decrees, and awards rendered
against the Director Gerieral of Railroads. No new loans are now
being made because the time for making application therefor has
expired. The expenditures by the Director GeneraLduring the fiscal
year for this purpose amounted to $173,708.61, making total net
expenditures by him on this account to June 30, 1929, of $33,650,886.
For a statement showing the principal amount of obligations held
as of June 30, 1928 and 1929, on account of loans made, see Table 50,
page 518.
The following statement shows the amounts of principal and interest
due from carriers in default as of June 30, 1929, on account of their
obligations for loans under this section:
95
SECRETAEY OF THE TREASURY
Principal in
default
Name of carrier
Aransas Harbor Terminal Ry _
Des Moines & Central Iowa R. R
Gainesville & Northwestern R. R. Co .
_
Minneapolis & St. Louis R. R. Co
Missouri & North Arkansas Ry. Co .
Salt Lake & Utah R. R. Co
Shearwood Ry. Co
.
_
Virginia Blue Ridge R. R. Co
Virginia Southern R. R. Co
Waterloo, Cedar Falls & Northern Ry. Co.
Wichita Northwestern Ry. C o . .
Total
62,800.00
5,000. 00
' 106,000.00
$95,025.00
18,406.05
475,607.00
874, 287. 06
221, 556. 07
1, 575. 00
19,080. 00
10, 252. 38
561,743.89
126,977. 50
$50,000.00
95,025. 00
93,406.05
475,607.00
874, 287. 06
284,356. 07
6, 575. 00
125, 080. 00
10, 252. 38
561, 743. 89
126,977. 60
298,'800.00'
. 2,404, 509. 95
2, 703,309.95
_ __
$50,000.00
_
75,000.00
_-
'
Total in
default
Interest in
default
1 Principal not yet due.
Securities owned by the United States Government
The aggregate amount of securities owned by the Government on
June 30, 1929, as compiled from the latest reports received, was
$11,115,050,159.87, as against $11,108,951,205.90 on June 30, 1928, an
increase of $6,098,953.97. A sumnaary comparison of the holdings
at the end of the last two fiscal years is as follows:
Summary of securities owned by the United States Government on June 30, 1928 and
1929
June 30, 1928
Foreign obligations:
Received under debt settlements
Another
Capital stock of war emergency corporations
Railroad obligations
Capital stock of Panama R. R__
Capital stock of Inland Waterways Corporation
Capital stock of Federal land banks
_
Capital stock of.Federal intermediate credit banks . .
Miscellaneous-securities received by War and Navy Departments and-U. S. Shipping-Board .
.
June 30, 1929
$7,198,879,927.93
3, 705,667,045.90
$7, 257,927,794.93
3,639,636, 271.90
10,904, 546,973. 83
55,097,998.51
74,608,948. 38
7,000,000. 00
5,000,000. 00
555,700. 00
25,000,000.00
10,897, 564, 066.83
42,143,894.39
62, 698, 691. 99
7,000, 000. 00
7, 500, 000. 00
383, 028. 75
30,000,000.00
37,141, 585.18
67,760,477. 91
11,108,951, 205.90
11,115,050,159.87
The principal decreases are in foreign obligations, amounting, in
round figures, tc $7,000,000, in capital stock of war emergency corporations of $13,000,000, and in railroad obligations of $12,000,000..
The decrease in capital stock of war emergency corporations is the
result of the procedure of offsetting the deposits inade by the corporations with the Treasury against such capital stock holdings.
The cash balance in the Treasury to.the credit of the United States
Shipping Board at the close of the fiscal year showed an increase of
over $11,000,000 as compared with the balance last year, which
accounts for substantially all the decrease in this class of securities.
The principal increases are as follows: $2,500,000 in the capital
stock of the Inland Waterways Corporation which was called during
the year, pursuant to the authority contained in the act of May 29,
96
^
REPORT ON THE FINANCES
1928, to give, the corporation greater working capital; $5,000,000 in
the capital stock of Federal intermediate credit banks, of which
$2,000,000 was called for the Columbia, S. C , bank and $3,000,000
for the Berkeley, Calif., bank; and about $30,000,000 in miscellaneous
securities due entirely to additional securities acquired by the United
States Shipping Board.
.
...
It will be noted that there has been a change in the classes of foreign
obligations which is larger than the net change shown in the total
of these obligations. This was due principally to the exchange of
funded bonds of the Governments of Yugoslavia and Greece for the
old bonds held and the bonds delivered by Greece as evidence of the
new loan, pursuant to the debt settlements dated respectively May
3, 1926, and May 10, 1929, and offset by the payments received on
account of principal during the year under the various debt settlements.
A detailed statement of the securities held on June 30, 1929, will
be found as Table 46, page 514.
Trust funds administered by the Treasury
Adjusted service certificate fund.—InYestments for the accountof the
adjusted service certificate fund were made during the fiscal year 1929
in special issues of Treasury notes bearing interest at the rate of 4
per cent per annum, IQ accordance with the procedure outlined in the
. annual report of the Secretary of the Treasury for the fiscal year 1925.
The investments made during the year amounted to $127,700,000,
of which $112,000,000 represented funds appropriated by Congress
and $15,700,000 was derived from mterest on investments. Redemptions during the year, to provide funds for authorized payments,
amounted to $16,500)000, on which interest amounting to $348,865.40
was paid to the date of redemption.
A statement of the condition of the fund as of June 30, 1929, is as
follows:
Adjusted service certificate fund, June 30, 1929
FUND ACCOUNT
Appropriations:
To June 30, 1928
Available Jan. 1, 1929
Interest on investments.
..
.-
$448, 000, 000. 00
112, 000, 000. 00
. 39, 954, 989. 59
599, 954, 989. 59
Checks issued by Veterans* Bureau against credits from fund
and paid by the Treasurer of the United States
Balance in fund June 30; 1929
85, 375, 998. 47
514, 578, 991. 12
SECRETARY OF THE- TREASTJRY
97
FUND ASSETS
Investments:
4 per cent Treasury notes—
Dated Jan. 1, 1925, maturing Jan. 1,
. 1930
_Dated Jan. 1, 1926, maturing Jan. 1,
1931
Dated Mar. 5, 1926, maturing Jan.
1,1932
Dated Jan. 1, 1927, maturing Jan. 1,
1932__..._
Dated Jan. 1, 1928, maturing Jan. 1,
1933-^
Dated Jan. 1, 1929, maturing Jan. 1,
1934
$15,000,000.00
53, 500, 000. 00
70,000,000.00
123,400,000.00
123,400,000.00
127,700,000.00
Balance to credit of disbursing officers of the Veterans' Bureau.
*"Total fund assets JuneSO, 1 9 2 9 . . .
$513, 000, 000. 00
1, 578, 991. 12
514,578,991. 12
Civil service retirement and disability fund,—During the fiscal year
1929 the Treasury continued to make investments for account of the
civil service retirement and disability fund in special issues of Treasury
notes bearing interest at the rate of 4 per cent per annum in accordance with the procedure outlined in the annual report of the Secretary
of the Treasury for the fiscal year 1926.
Credits to the fund during the fiscal year aggregated $49,037,480.81,
of which $28,122,941.18 was on account of deductions from basic compensation of employees and service credit payments, $964,539.63
represented interest and profits on investments, and $19,950,000 was
appropriated by Congress. Interest amounting to $3,482,257.53
was due June 30, 1929, but owing to the fact that such date was
Sunday this amount could not be credited in the fund until July 1,
1929, making total interest and profits for the year of $4,446,797.16.
° Expenditures on account of refunds to employees, annuities, etc.,
aniounted during the fiscal year to $16,043,373.24, as compared with
$14,792,709.64 for the previous year. The total earnings and profits
on investments to June 30, 1929, including the amount credited
July 1, 1929, amounted to $17,657,941.02.
In order to begin the financing of the liability of the Government in
connection with this fund. Congress provided an initial appropriation
of $19,950,000 available July 1, 1928. This sum was placed to the
credit of the fund and was invested as of that date in special issues of
Treasury notes bearing interest at the rate of 4 per cent per annum,
payable on June 30 of each year. It is contemplated that an annual
appropriation will hereafter be made for this fund untU the liability
of the Government has been fully covered. The appropriation
available July 1, 1929, amounted to $20,500,000.
71799—30—Fll 92 9
-9
.
98
REPORT ON T H E FINANCES
The following statement shows.the status of the fund as of June 30,
1929:
Civil service retirement and disability fund, J u n e 30, 1929
Credits:
On account of deductions from basic compensation of employees and service credit p a y m e n t s from Aug. 1, 1920,
to June 30, 1929
$170,852,443.27
Appropriation from t h e general fund of t h e Treasury
19, 950, 000. 00
On account of interest and profits on investments from
Aug. 1, 1920, to J u n e 30, 1929. (Does not include
$3,482,257.53 due J u n e 30 (Sunday) paid on July 1,
1929.)
:_-14, 175, 683. 49
Less disbursements on account of annuities and refunds
Balance in fund J u n e 30, 1929
Assets:
$22, 695, 050 face a m o u n t of fourth Liberty loan 4J4 per cent
bonds (principal c o s t ) . . $ 2 2 , 3 9 9 , 4 5 4 . 0 1
$31, 200, 000 face a m o u n t of 4 per cent
special Treasury notes
payable J u n e 30, 1931
(principal c o s t ) . . .
31, 200, 000. 00
$14, 400, 000 face a m o u n t of 4 per cent
special Treasury notes
payable J u n e 30, 1932
(principal- cost)
14, 400, 000. 00
$47, 800, 000 face a m o u n t of 4 per cent
special Treasury notes
payable J u n e 30, 1933
(principal cost)
. 47, 800, 000. 00
•'
$116,095,050
[Jnexpended balances:
Disbursing account
168, 370. 26
On books of t h e Secretary of t h e
Treasury
160, 717. 07
•
T o t a l fund assets J u n e 30, 1929
204, 978, 126. 76
88, 849, 585. 42
116, 128, 541. 34
115,799,454.01
329, 087. 3 3
116, 128, 54L 34
District qf Columbia teachers^ retirement fund.—This fund was established by the act of January 15, 1920. Its administration is vested
in the Commissioners of the District of Columbia. Investments are
made by the Treasurer of the United States upon the advice of the commissioners. Under the amendment of July 11, 1926 (44 Stat. p. 727),.
investments on account of reserves created as a result of annual appropriations are held by the Treasurer of the United States separate from
investments on account of the contributions of teachers. Investments
made by the Treasurer during the fiscal year 1929, are as follows:
99
SECEETAEY OF THE TEEASUEY
Government reserves fund
Deductions fund
Face amount Principa Jcost Face amount Principal cost
4 per cent Federal farm loan bonds
i H per cent Federal farm loan bonds.
4H per cent Federal farm loan bonds
__
$276,440.00
500. 00
$270,316. 54
505.00
276,940.00
270,821.54
$195,640. 00
70,300. 00
$188,425. 78
68, 224.33
265,940.00
256,650.11
The followirig statement shows the status of the combined funds as
of June 30, 1929:
District of Columbia teachers^ retirement fund, June 30, 1929
Credits:
On account bf deductions from basic compensation of
teachers from Jan. 15, 1920, to June 30, 1929
J
$2, 256, 871. 59
Appropriations from general fund of the Treasury
1, 068, 456. 03
Interest on investments
403,878. 10
Less disbursements on account of annuities and refunds.
Balance in fund June 30, 1929__
2, 774, 579. 90
Assets:
Deductions fund:
$26, 850 face amount of 4J4 per cent first
Liberty loan converted bonds
at principal cost of
735, 750 face amount, of 4}^ per cent
fourth Liberty loan bonds at
principal cost of
10,000 face amount of 4^4 per cent
Treasury bonds of 1947-1952
at principal cost of
55, 320 face amount of 4 per cent Federal farm loan bonds at principal cost of
744, 880 face amount of 4}4 per cent Federal farm loan bonds at principal cost of
417, 440 face amount of 4)^ per cent Federal farm loan bonds at principal cost of..
91, 380 face amount of 4 ^ per cent Federal farm loan bonds at principal cost of
1, 000 face amount of 5 per cent Federal farm loan bonds at principal cost of
3, 729, 205. 72
954, 625. 82
$27, 529. 64
704, 371. 27
10, 000. 00
54, 660. 95
743, 918. 47
426, 788. 96
94, 627. 91
1,030. 00
100
REPORT ON THE FINANCES
Assets—Continued.
$182,000 face amount of 4>^ per cent
Philippine Island bonds at
principal cost of
2,264,620,
'
Government reserves fund:
215, 640 face amount of 4 per cent Federal farm loan bonds at principal cost of
266, 600 face amount of 4}4 per cent Federal farm loan bonds at principal cost of
100 face amount of 4% per cent Federal farm loan bonds at principal cost of
482, 340
2,746,960
Accrued interest paid in 1929 repayable in 1930
Unexpended balances:
On books of Secretary of the Treasury
Treasurer, United States, disbursing account.
$197, 669. 56
2,260,596.76
208, 050. 78
266, 361. 76
101. 64
474, 514. 18
$2,735, 110.94
529. 98
38, 342. 99
595. 99
38, 938. 98
Total fund assets June 30, 1929
,2, 774, 579. 90
Foreign Service retirement and disability fund.—Investments for
account of the Foreign Service retirement and disabffity fund were
made during the fiscal year 1929 in special issues of Treasury notes
bearing interest at the rate of 4 per cent per annum, in accordance
with the procedure outlined in the annual report of the Secretary
of the Treasury for the fiscal year.1927.
Credits to the fund during the fiscal year aggregated $388,180.56,
of which $168,841.38 was on account of deductions from basic compensation of employees and service credit payments, $6,339.18 represented interest and profits on investments, and $213,000 was appropriated by Congress. Interest amounting to $18,223.45 was due
June 30, 1929, but, due to the fact such date was Sunday, this amount
could not be credited to the fund until July 1, 1929, making total
interest and profits for the year of $24,562.63. Net advances to the
disbursing officer of the State Department for the payment of annuities and refunds, etc., amounted during the fiscal year to $90,874.81,
as compared to $97,811.58 for the previous year. The total interest
and profits to June 30, 1929, amounted to $59,555.51.
During the fiscal year Congress provided an initial appropriation
of $213,000 available July 1, 1928, for the beginning of the financing
of the liabffity of the Government in connection with this fund.
SECRETARY OF THE TREASURY
101
This amount was invested on July 1, 1928, in special issues of Treasury
notes in accordance with the usual procedure. The appropriation
available July 1, 1929, amounted to $216,000.
All of the securities in the investment account of the fund on June
30, 1929, were held in safe-keeping by the Division of Loans and
Currency of this department and the Federal Reserve Bank of New
York.
The following statement shows the status of the fund as of June 30,
1929:
Foreign Service retirement and disability fund, June 30,1929
Credits:
On account of deductions from basic compensation and
service credit payments of employees subject to the Foreign Service act
$771, 931. 81
Appropriations from the general fund of the Treasury
213, 000. 00
Interest and profits on investments (does not include
$18,223.45 due June 30 (Sunday) paid on July 1, 1 9 2 9 ) . . .
41, 332. 06
1, 026, 263. 87
Less net advances to disbursing officer of the State Department
for the payment of annuities and refunds
• 386, 462. 64
Balance in fund June 30, 1929.
.
639, 801. 23
Assets:
$79, 150 face amount fourth Liberty loan 4)4 per
cent bonds at principal cost of
$81, 069. 85
56,300 face amount 3J4 per cent Treasury
notes, series A-l930-32, at principal
cost of
56, 300. 00
502, 000 face amount 4 per cent special Treasury
notes, due June 30, 1933
502. 000. 00
637,450
Unexpended balance June 30, 1929, on books of the Secretary of
the Treasury
Total fund assets June 30, 1929
639,369.85
431. 38
639, 801. 23
Library qf Congress trust fund,—Under the act of March 3, 1925, as
amended, a Library of Congress trust fund board, consisting of the
Secretary of the Treasury, the chairman of the Joint Committee on
the Library, the Librarian of Congress, and two persons appointed by
the President, is authorized to accept, receive, hold and administer
such gifts or bequests of personal property for the benefit of or in
connection with the Library, its collections, or its service as may be
approved by the board and by the Joint Committee on the Library.
The moneys or securities given or bequeathed to the board are required to be receipted for by the Secretary of the Treasury, who is,
authorized to invest, reinvest, or retain investments as the board may
102
REPORT ON THE FINANCES
determine. In accordance with the policy adopted by the board,
investments and reinvestments of cash forming the principal of trust
funds are made in interest-bearing securities of high rating.
The earnings credited to the fund during the fiscal year amounted
to $24,923.12, making total earnings received to June 30, 1929, of
$51,497.56.
The board received during the year, on account of securities held
in the donation made by Mrs. Elizabeth Sprague Coolidge, subscription rights to 10 shares of common stock of the Public Service Co. of
Northern Illinois and also to $2,850 face amount of 10-year 4 ^ per
cent gold debenture bonds of the American Telephone & Telegraph
Co. A 5 per cent first and refunding mortgage bond of the Central
Illinois Public Service Co. in the face amount of $1,000, held in the
donation account of Mrs. Coolidge, was called for redemption during
the year in accordance with its terms at 105. The subscription rights
mentioned were sold on the market for $1,515.75, which, together
with the proceeds of the bond redeemed, amounting to $1,050, an
adjustment of accrued interest of $36.67, and the unexpended balance
of $2,061.65 at the close of last fiscal year, made a total of $4,664.07
available for investment during the year. Of this sum available,
$2,023.17 was expended during the year for $2,000 face amount of
first and refunding 5 per cent bonds of the Missouri Pacific Railroad
Co. Substantially all of the remaining balance of $2,640.90 was
invested shortly after the close of the fiscal year.
The income from the investments in the donation of the Carnegie
Corporation is applicable under the terms of the gift as an honorarium to the Chief, Division of Prints, Library of Congress. This
position was vacant when the donation was made and has since continued to remain vacant; as a result the income has not been used
and has accumulated to the amount of $5,454.91. Of this accumulation $4,848.61 was' expended for $5,000 face amount of first and
refunding 5 per cent bonds of the'Missouri Pacific Railroad Co.,
leaving a balance in the income account of $606.30. The uninvested
balance of principal in the trust account is $70.75.
The uninvested balance in the donation account of Mr. Archer M.
Huntington is $993.75, an increase over last year of $701.25 due to
receipts on account of accrued interest paid for originally out of
principal.
Mr. James B. Wilbur, a member of the Library of Congress trust
fund board and a donor to the fund, died on April 28, 1929. Under
the terms of his donation he retained during his life six-sevenths,
subsequently reduced to four-sevenths, of the income from the investments thereof and the remainder was credited to the fund. After his
death the entire income is to be credited to the fund. I t is understood
103
SECRETARY OF THE TREASURY
that under the provisions of his will the board will receive a further
sum.
The following statement shows the securities held by the board for
account of each donation as of June 30, 1929. The securities are all
held in safe-keeping by the Treasurer of the United States, subject
to the order of the Secretary of the Treasury for account of the board.
Library of Congress trust fund board securities held June 30, 1929
per
Face amount Rate
cent
Name of security
Class of security
Elizabeth Sprague Coolidge donation
Chicago Railways Co_
Great Northern Ry. Co
Houston Home Telephone Co
Missouri Pacific R. R. Co
New England Telephone & Telegraph
Co.
Potosi Rio Verde Ry. C o . . .
Public Service Co. of Northern Illinois.
Rio Grande Southern R. R. Co
Utah Power & Light Co
Jacob M. and Tillie Fine and Charles
and Birdie Fine.
American Ship Building Co
American Telephone & Telegraph Co...
American Window Glass Machine
Board of Trade Building Trust of
Boston.
Commonwealth Edison Co
Elgin National Watch Co
Mexican Northern Ry. Co
Public Service Co. of Northern Illinois..
$5,000.00
10,000.00
100. 00
2,000.00
16,400.00
First mortgage bonds.
General mortgage bonds.
First mortgage bonds.
6 First and refunding mortgage bonds.
i}i First mortgage bonds.
1,463.20
13,000.00
1,000.00
10,000.00
10,000.00
6
5
4
5
6
Do.
First and refunding mortgage bonds.
First mortgage bonds.
Do.
5H Promissory note,
10,000.00
17,100.00
2, 500. 00
700.00
Common stock.
Do.
Do.
Do.
12,400. 00
9, 375. 00
800. 00
5,000.00
Do.
Do.
Do.
Preferred stock.
6
Carnegie donation
Commonwealth Edison Co
Missouri Pacific R. R Co
New England Telephone & Telegraph
Co.
52,000. 00
6,000.00
25,400.00
. iVi First mortgage collateral bonds.
5 First and refunding mortgage bonds.
iH First mortgage bonds.
Archer M. Huntington donation
Central Pacific Ry. Co
Missouri Pacific R. R. Co
105,000.00
49, 600.00
4
6
First and refunding mortgage bonds.
Do.
100,000.00
7
Preferred stock.
James B. Wilbur donation
-Public Service Co. of Northern Illinois..
William E. Benjamin donation
standard Oil Co. of California
r
32,600. 00
Common stock.
R. R. Bowker donation J
Detroit Edison Co
German Government
Japanese Government
Austrian Government
TotaL
_....
5,000.00
2.000. 00
2,000. 00
1,000.00
506, 238. 20
5
7
m
First mortgage bonds.
German external loan.
Sinking fund gold bonds.
Sinking fund bonds, guaranteed loan.
7
1 Life interest in six-sevenths of income retained under terms of donation.
United States Government life insurance fund.—Under the provisions of section 18 of the act approved December 24, 1919, as.
amended March 4, 1923, the Secretary of the Treasury is required
to invest in interest-bearing obligations of the United States or in
bonds of thet Federal land banks all moneys received in payment of
premiums on converted insurance in excess of authorized payments.
104
REPORT ON T H E FINANCES
Due to the act approved March 3, 1927, authorizing the Director of
the United States Veterans' Bureau to make loans to veterans upon
their adjusted service certificates out of the United States Government life insurance fund, the funds available for other investments
during the past year have been very small in amount. Practically
all of the funds available during the fiscal year under review were
used to make loans to veterans, but whenever the accumulated funds
temporarily exceeded the requirements for this purpose and the
authorized payments, the excess was iavested in United States
securities. During the year the total Government securities decreased $4,646,000 face amount. The Director of the Veterans'
Bureau reported total loans to veterans to June 30, 1929, aggregating $133,914,090.69.
Monthly reports are made by the Treasury to the Veterans' Bureau
of all securities in the fund and the prmcipal cost thereof as the
result of investments made by the Secretary of the Treasury, and
periodic verifications of the security holdmgs are made through
reports rendered to the director by the safe-keeping offices.
The investments as of June 30, 1929, were as follows:
Par value
Fourth Liberty loan i H per cent bonds of 1933-1938
i H per cent Treasury bonds of 1947-1952 .
3H per cent Treasury notes, series A-1930-1932
Total
--
i H per cent Federal farm loan bonds
4J4 per cent Federal farm loan bonds
$58,741,800.00
49,173,200.00
4,000,000.00
$57,498,119.36
49 201, 905 28
3,911,402.24
111,915,000.00
110,611,426.88
32,550,000. 00
69,200, 000.00
32, 477, 590. 04
69, 742, 644. 40
Total investments made by the Secretary ofthe Treasury
213, 665, 000.00
212, 831, 661. 32
Loans to veterans as reported by the Director of the United States
Veterans' Bureau
133,914,090.69
133,914,090. 69
347, 579,090. 69
346, 745,752.01
Total investments in the fund
-.
Principal cost
.
..
_
Division of Bookkeeping and Warrants
Organization and functions.—The Division of Bookkeeping and
Warrants was created by an act of Congress approved July 31, 1894.
Prior to that time it was known as the Division of Warrants, Estimates, and Appropriations. The act of 1894 provides that upon the
books of this division shall be kept all accounts of receipts and
expenditures of public money, except postal. Under the abovementioned act the division prepares for the Secretary of the Treasury
an apnual combined statement of the receipts and expenditures of the
Government, which is transmitted to Congress at the beginning of
each regular session. The law requires that wherever practicable
the receipts shall be classified by ports, districts, and States, and
the expenditures under each separate head of appropriation.
SECRETARY OF THE TREASURY .
105
The division issues, in the name of the Secretary, all warrants on
the United States Treasury; keeps detailed and controlling accounts
with receipts, appropriations, and expenditures of the public money
covering all executive departments and independent establishments,
including transfers of funds between departments when -authorized
by law; compiles the annual digest of appropriations; prepares financial data for the annual report of the Secretary of the Treasury; compiles statistics relating to the receipts, appropriations, and expenditures of public money; covers public moneys into the Treasury
as required by law; approves duplicate disbursing officers' checks;
makes admimstrative examination of claims for the proceeds of
unpaid checks over three years old; administers the appropriations
for the transfer of United States paper currency and coin between
Federal reserve banks and branches, the mints, and the Treasury,
and appropriations for the recoinage of gold, minor, and silver coins;
handles for the Secretary requests of disbursing officers to carry cash,
to procure advances from the Treasury in excess of the penalties of
their bonds, permission to merge accounts, and the waiver of delinquencies in the rendition of accounts; handles for the Undersecretary
and budget officer of the department the routine work relating to
estimates, apportionments, reserves, and related matters; handles
the Secretary's special deposit accounts covering alien property
funds, offers in compromise, guaranty deposits by contractors, etc.,
making collections and disbursements and rendering accounts therefor to the General Accounting Office; makes current audit covering
the payment of awards under the settlement of war claims act of 1928;
makes semiannual audit of the distribution of earnings on alien
property trust funds held by the Treasury; makes annual audit of
the profit and loss statements of Federal reserve banks and Federal
intermediate credit banks in connection with franchise tax paymerits;
handles all reports of the Treasury Department to committees of ,
Congress on pending legislation, and requests of the department for
decisions of the Comptroller General of the United States and opinions of the Attorney General; prepares for certification to Congress
judgments of the Court of Claims and the United States district
courts, claims for damages under the act of December 28, 1922,
and claims found due by the General Accounting Office under appropriations which have lapsed by limitation of law. The division is
responsible for the submission of certain reports to Congress annually under sundry provisions of law; distributes the daily statement of the United States Treasury and the monthly public debt
statement of the United States; handles court subpoenas on the
Secretary of the Treasury, and matters relating to the payment of
private relief claims; makes examination of old papers and records
relating to claims from the organization of the Government; and
106
REPORT ON T H E FINANCES
handles a large amount of correspondence covering a wide range of
subjects.
Warrants.—All moneys either covered into or paid» out of the
Treasury must by law be so covered or paid upon proper warrant.
Covering warrants are issued for the purpose of formally covering
into the Treasury revenues and repayments to appropriations. Appropriation warrants are issued for the purpose of placing to the credit
of appropriation accounts the amounts appropriated by acts of Congress. Accountable warrants are issued for the purpose of placing
money to the credit of disbursing officers' checking accounts. Settlement warrants are issued for the payment of claims found due by
the General Accounting Office. Transfer appropriation warrants are
issued to transfer funds from one department or agency to another
for direct expenditure. Transfer (debit) and counter (credit) warrants are issued to adjust appropriations on account of expenditures
previously made. Surplus fund warrants are issued to charge off
the books appropriations or parts of appropriations which have been
repealed or which have lapsed by limitation of law.
The number and amount of warrants issued under the several
classes during the fiscal year 1929 are as follows:
Number
Covering warrants
Appropriation warrants
Accountable warrants
Settlement warrants
Transfer appropriation warrants
Transfer warrants
Counter warrants
Surplus fund warrants
Total...
Ordinary
Public debt
Total
5,372 $4,296, 682, 323. 94 $5,194, 375, 542. 22 $9 491 057 866 16
624 2,627,046,973.11
5,872, 799, 909. 66 8,499, 846,882. 77
20, 423 3, 431,371,080.15 5, 867, 468, 357. 55 9,298 839,437 70
27,127
87,359, 500.77
87, 359; 500. 77
349
55, 977,112. 50
554,076, 667. 95
610, 053, 780. 45
362 . 1785,956,025.51
4, 323, 800. 00
790,279,825. 51
362
1 785,956, 025. 51
4, 323,800. 00
790, 279,825. 51
40
30, 072,453. 44
30,072, 453. 44
54, 659 12,100,421,494.93
17, 497, 368,077. 38 29,597, 789,^572. 31
1 Issued principally on account of Army account of advances, and general account of advances (Navy).
Appropriations.—At the beginning of the fiscal year 1929 the unexpended balances to the credit of appropriations on the books of this
division amounted to $1,167,363,922.54, of which $951,777,477.82
represented continuous or no-year appropriations, and $215,586,444.72
annual appropriations. Continuous or no-year appropriations are
available until expended or until the object for which they are provided has been fully accomplished. Annual appropriations are
subject to fiscal year limitation; that is, they are available for obligation only during the fiscal year for which they are provided. The
unexpended balances of annual appropriations, however, remain on
the books of the Treasury for two additional fiscal years, during which
tiriie they are available to meet the payment of obligations properly
incurred during the fiscal year for which made. For example, the
unexpended balances of the annual appropriations for the fiscal year
1929 are not available for obligation after June 30, 1929, but they
SECRETARY OF THE TREASURY
107
will remain on the books of the Treasury until June 30, 1931, to meet
the payment of obligations properly incurred prior to July 1,- 1929.
After the additional two-year period shall have expired the unexpended balances on the books will be carried to the surplus fund in
accordance with the act of June 20, 1874, as amended.
The appropriations established upon the books during the fiscal
year 1929, including public debt retirements chargeable against ordinary receipts, expenditures from appropriations, amount carried to
the surplus fund, and the unexpended balances and outstanding
. settlement warrants at the beginning and close of the fiscal year, are
shown below, and an accountability statement of appropriations by
acts of Congress will be found in Table 21, page 450.
Unexpended balances June 30, 1928: .
On books of Treasury
. To credit of disbursing officers i
Outstanding warrants
Appropriations
$1, 167, 364, 775. 50
2 254, 932, 894. 45
1, 704, 346. 79
3, 932, 920, 500. 73
Total
Expenditures
Carried to surplus fund
Outstanding warrants
Unexpended balances on June 30, 1929:
On books of Treasury
To credit of disbursing officers 1
Total
5, 356, 922, 517. 47
3, 848, 413, 287. 11
30, 072, 453. 44
2, 057, 912. 95
!
1, 197, 989, 780. 60
278, 389, 083. 37
5, 356, 922, 517. 47
Receipts and expenditures.—The ordinary receipts of the Government for the fiscal year 1929, on the basis of daily Treasury statements, revised, amounted to $4,036,218,918.67. The expenditures,
including $549,603,703.75 public debt retirements chargeable against
ordinary receipts, amounted to $3,848,413,287.11, resulting in a
surplus of ordinary receipts over expenditures chargeable against
such receipts of $187,805,631.56. Of this surplus, $123,489,111.58
was used for public debt retirements during the fiscal year 1929, the
remainder, $64,316,519.98, being reflected in an increase in the
general fund balance, which, on June 30, 1929, amounted to $324,506,850.83, as compared with $260,190,330.85 on June 30, 1928.
This increase in the balance, however, was only temporary, since
early in the fiscal year 1930 the funds were used for further debt
retirement.
1 On books of Treasurer, United States, includes outstanding disbursing oflicers' checks.
» Exclusive of $64,352,768.79 explained in footnote i, Table 2, p. 378.
108
REPORT ON T H E FINANCES
Public debt receipts for the .fiscal year 1^929 amounted to $5,194,341,732.37. Public debt expenditures, including $549,603,703.75
chargeable against ordinary receipts, amounted to $5,867,434,547.70.
The excess of public debt expenditures over public debt receipts,
therefore, amounted to $673,092,815.33. This reduction in the
pubhc debt was accomplished as follows: From the cumulative
sinking fund, $370,277,100; purchases and retirements from foreign
repayments, $571,150; received from foreign governments under debt
settlements, $175^642,350; received for estate taxes, $20,000; purchases and retirements from Federal reserve and Federal intermediate credit banks franchise-tax receipts, $2,933,400; forfeitures,
gifts, etc., $159,703.75; making a total of $549^603,703.75, chargeable
against ordinary receipts, and an additional sum of $123,489,111.58
applied from surplus revenues. The gross public debt on June 30,
1929, amounted to $16,931,197,747.60, as compared with $17,604,290,562.93 on June 30, 1928.
The total receipts for 1929 from all sources, including ordinary
and public debt, amounted to $9,230,560,651.04, as compared with
an expenditure of $9,166,244,131.06. The excess of all receipts over
all expenditures, $64,316,519.98, is refiected by an increase in the
general fund balance from $260,190,330.85 on June 30, 1928, to
$324,506,850.83 on June 30, 1929. The details of receipts and
expenditures will be found in Tables 1, 2, and 3 on pages 375 to 393.
A statement showing the receipts and expenditures for the fiscal
year 1929, and their effect upon the public debt and the general
fund balance, is given below:
'
Ordinary
Receipts
Expenditures
$4, 036, 218,918. 67
1 3, 848, 413, 287.11
Excess of receipts
. -_ . .
. .
Excess of expenditures
_
._
Public debt expenditures chargeable against
ordinary receipts (see notes 1 and 2)
Total debt decrease
Gross public debt June 30, 1928..Gross public debt June 30, 1929..
General fund balance June 30, 1928
Public debt
_
187, 805, 631. 56
Total
$5,194, 341, 732. 37 $9, 230, 560, 651. 04
2 5,317,830,843.95 9,186, 244,131. 06
123,489, 111. 58
64, 316, 519. 98
549, 603, 703. 75
0
673, 092, 815. 33
17, 604, 290, 562. 93
16,931,197, 747. 60
General fund balance June 30, 1929
260,190, 330. 85
324, 506, 850. 83
1 Includes $549,603,703.75 public debt expenditures chargeable against ordinary receipts.
2 Excludes $§'49,603,703.75 public debt expenditures chargeable against ordinary receipts.
District of Columbia account.—Under the act of June 29, 1922 (42
Stat. 669), the Treasury is required to keep a special account of the
receipts and expenditures of the District of Columbia. The status
of this account as of June 30, 1929, on the basis of warrants issued,
was as follows:
109
SECEETARY OF THE TREASURY
General funds
special funds
T r u s t funds
Total
Balance, JuneSO, 1928
-Revenues, fiscal ^-ear 1929
$13,267,301.21
1 28, 352, 472. 90
$697,230. 82
3,098, 063.10
$360,222. 91
2 2, 079, 727.17
$14,224, 754. 94
33, 530,263.17
E x p e n d i t u r e s , fiscal year 1929.
41,619,774.11
•1 26, 645,983. 99
3,695, 293. 92
3,206,511.05
2, 439,950. 08
2,053, 711. 39
47, 755, 018.11
31,906,206. 43
488, 782. 87
386,238.69
15, 848, 811. 68
B a l a n c e J u n e 30, 1929
..,
14,973, 790.12
1 Exclusive of $463,562.61 general revenues of the District of Columbia covered into the Treasury to credit
of "Policemen and firemen's relief fund (trust fund)" under act of Sept. 1, 1916, vol. 39, p. 718, sec. 12, to
meet deficiencies in said fund.
»Includes $463,562.61 referred to in note 1.
» Exclusive of $9,000,000 payable from revenues of the United States.
Alien Property Custodian account.—Under the provisions of the act
of Congress approved October 6, 1917, and the proclamation and
Executive orders issued, thereunder by the President, and the settlement of war claims act of 1928, the Secretary of the Treasury purchased and exchanged during the year for account of the Alien Property Custodian United States securities of a par value of $16,506,900.
Securities held for this account on July 1, 1928, amounted to $155,638,800. There were sold or redeemed during the year securities
in the face amount of $78,630,400. The proceeds were reinvested
or made available for authorized payments. A face amount of
$1,423,500 was transferred to the Austrian special deposit account
on December 7, 1928, and the sum of $8,500,000 face amount was sold
on January 15, 1929, to provide funds for transfer to the German
special deposit account in accordance with the provisions of the
settlement of war claims act of 1928. The total face amount of
securities held by the Treasury in trust for the Alien Property Custodian on June 30, 1929, was $93,515,300.
Under decision of the Supreme Court of the United States, dated
May 24, 1926, in the case of Max Henkels, appellant, v. Howard
Sutherland, as Alien Property Custodian, and Frank White, as
Treasurer of the United States of America, and opinions of the Attorney General, dated August 25, 1926, and July 7, 1927, rendered in
connection therewith, there has been paid by the Tre'asury to eligible
claimants upon determinations of the Attorney General to September
15, 1929, the sum of $5,126,947.88, and to the Alien Property Custodian for administrative expenses the sum of $68,337.06. The sum
of $155,745.41 was withheld from claimants pending the determination of income tax liabffity, if any, of which $114,775.42 has been
refunded, leaving a balance in this account of $40,969.99. Further
payments of this character, except those not completed by the
Treasury, are made by the Ahen Property Custodian under provisions of the settlement of war claims act of 1928, as amended.
no
REPORT ON T H E FINANCES
The total amount paid during the fiscal year 1929, upon authorizations of the Alien Property Custodian and the Attorney General,
was $54,334,919.47.
Outstanding liabilities.-.—Under the provisions of title 31, section 149,
of the United States Code, the proceeds of approximately 144,000
checks which were outstanding and unpaid for three fiscal years on
June 30, 1928, aggregating the sum of $890,042.29, were covered into
the outstanding liabilities trust fund and placed to the personal
credit of the payees, subject to claim and payment upon proof of
ownership. Approximately 2,300 claims were given an administrative examination in this office and referred to the General Accounting
Office for certificates of settlement. Payments from the fund during
the fiscal year 1929, pursuant to title 31, section 151, of the United
States Code, amounted to $144,018.23. The increase in the number
of checks covered into the outstanding liabilities trust fund during
the fiscal year 1929 was occasioned by the 25 per cent refund of income
tax authorized by section 1200 of the revenue act of 1924. The
posting of these checks necessitated the detail of two employees from
the Bureau of Internal Revenue from October 3, 1928, to July 2, 1929.
Many of the checks, being in small amounts, may never be received
for payment.
The transactions under this fund during the past 11 years were as
follows:
Fiscal
year
1919....
1920....
1921....
1922....
1923.-.
1924
1925...-
Payments
(debits)
Deposits
(credits)
Balance
$56,050.48
$85,486. 54 $1,360,341. 35
13,978. 99
79,935. 76 1,426,298.12
26,075. 30
111, 709. 73 1,511,932. 55
64, 619.19
65^, 917. 04 2; 103,230.40
137,559. 07 1,811, 800. 25 3, 777,471. 58
166,568. 86 1, 210,144. 70 4,821,047.42
204,141.11
797,960. 69 5,414,867.00
Fiscal
year
1926....
1927..-.
1928....
1929....
Paym'ents
. (debits)
$153,699.74
429,856.96
191,189.42
144,018.23
Deposits
(credits)
Balance
$486,398.98 $5, 747,566. 24
690,621.22 6,008,330. 50
577,936.13
6,395,077. 21
890,042. 29 7,141,101. 27
1,587, 757. 35 7,397,953.33
Duplicate checks.—The number of duplicates of lost, stolen, or
destroyed checks of public disbursing ofl&cers, approved in pursuance
of title 31, section 528, of the United States Code, was 6,938. This
work required the examination of an equal number of bonds of
indemnity.
Contingent expenses, public moneys.—Vouchers approved by this
division during the fiscal year 1929, payable from the appropriation
^'Contingent expenses, public moneys, 1929,'' for the transportation
of United States paper currency and coin, were as follo\\^s:
Postage on shipments of mutilated currency. to Washington for,
redemption
$125, 504
Insurance on new currency shipments from Washington
62, 378
Express and incidental charges
.
21, 704
Coin bags
.-.
3, 110
111
SECRETARY OF THE TREASURY
Telegraph
Other charges
$2,083
2, 278
Total
.
217,057
Recoinage of uncurrent gold, minor, and silver coin.—Vouchers
covering the loss on uncurrent coin, representing the difference
between their face amount and the amount produced in new coin,
were approved as follows:
Amount recoined
Gold
Minor..
Silver
..
.
$2,463,329. 00
273,468. 21
3,786,123. 90
Loss on recoinage
$2,998.63
14,995.79
313,150.65
Percentage
of loss
0.12
6.48
8.2 7
Budget matters.—A summary of the work handled by the division
in connection with estimates of appropriations, receipts, and expenditures, and the apportionments of appropriations, etc., is set forth on
page 117 under the heading '^Budget and improvement committee.''
Ofi^ers of compromise.—The deposits and payments handled by this
division on account of offers of compromise, exclusive of internal
revenue cases which are handled by cpllectors of internal revenue,
were as follows:
Number
Unexpended balance June 30, 1928..
Deposits
Payments
Unexpended balance June 30, 1929..
657
595
Amount
$503,073.16
1, 296, 799. 63
1, 547, 206. 34
252, 666. 45
Guaranty deposits by public building contractors, etc.—The deposits
and payments on account of amounts temporarily deposited by contractors to guarantee fulfillment of contracts for fuel, operating
supplies and repairs to public buildings, etc., were as follows:
Number
Unexpended balance June 30,1928..
Deposits
Payments
Unexpended balance June 30, 1929..
607
641
Amount
$67,696,75
59,201.62
70, 793.36
66,105.01
Division of Deposits
During the fiscal year 1929 there was no change in the Treasury's
established policy with respect to Government deposits. As in recent
years, such deposits were carried with banks located at points where
it was actually necessary for the transaction of some essential Government business. Government deposits were carried with the
several Federal reserve banks and their branches, special deposi
112
REPORT ON THE FINANCES
taries, foreign depositaries, national bank depositaries, depositaries
designated under the provisions of the act of M a y 7, 1928, and
depositaries in the insular possessions of the United States.
As was anticipated, the approval of the act of May 7, 1928, making
State banks and trust companies which are members of the Federal
reserve system eligible for designation as general or limited depositaries of public moneys, resulted in an unusual number of applications for Government deposits from this particular class of banks.
Two State member banks were designated general depositaries of
public moneys. Twenty State member banks were designated
limited depositaries of public moneys. during the fiscal year 1929.
Such banks qualified for designation, in accordance with the regulations set out in Treasury Department Circular No. 176, covering the
designation of national banking associations as general or limited
depositaries of public moneys, the provisions of which were extended
to include State member banks.
The Division of Deposits has given close supervision to the depositary system of the Government, the issuance of instructions to
public oflicers as to the deposit of public moneys, the authorization
of the acceptance of cohateral amply to protect Government deposits^
the liquidation of Government claims against insolvent banks, the
revision of Department Circular No. 92, which contains the regulations covering special deposits of public moneys, and many miscellaneous matters.
A brief summaryof the changes within the depositary system of
the Treasury during the fiscal year ended June 30, 1929, follows:
General depositaries,—On June 30, 1928, there were 318 general
depositaries, and on June 30, 1929, 322 banks held such designation.
During the fiscal year 1929, 13 banks were designated general depositaries of pubhc moneys and 9 were discontinued as such depositaries.
At the close of the fiscal year 1928 deposits to the credit of t h e
Treasurer of the Uniteci States in general depositaries tptaled
$6,472,887.64 as against $7,145,973.07 on June 30, 1929.
Limited depositaries.—During the fiscal year 1929 the Treasury
jjiesignated 44 additional limited depositaries of public moneys and
discontinued 28, the total number being 972 on June 30, 1929. On
June 30, 1928, deposits held by general and limited depositaries of
public moneys to the official credit of Government officers, other
than the Treasurer of the United States, totaled $17,876,541.76, and
on June 30, 1929, such deposits amounted to $18,653,092.02.
Insular depositaries,-^Duimg the fiscal year 1929 the Treasury
maintained five insular depositaries, located in the Canal Zone,
Phihppine Islands, and Porto Rico. The total Government deposits
SECRETARY OF THE TREASURY
113
with such depositaries on June 30, 1928, amounted to $2,032,035.84,
and on June 30, 1929, such deposits amounted to $1,205,019.47.
Foreign depositaries.—The Treasury during the fiscal year 1929
designated a depositary in Belgium, and, in addition, depositaries
were maintained in China, England, France, Haiti, Italy, and Panama.
Deposits with this class of depositaries totaled $372,112.10 on June
30, 1928, and $1,599,620.25 on June 30, 1929.
Special depositaries.—During the fiscal year 1929, 356 special
depositaries were designated and 1,066 discontinued. The large
number of discontinuances of this class of depositary was the result of
the Treasury's continued policy of revoking the designation of special
depositaries which have not, over a specified period, maintained active
accounts. Deposits in such depositaries on June 30, 1928, were
$245,730,779. 32, and on June 30, 1929, were $356,841,912.95. The
amount of these deposits is dependent entirely upon the amount of
Government securities subscribed for by the depositary banks and
which, under the terms of the offering, are paid for by credit. Such
deposits are subject to call by the Secretary of the Treasury whenever
funds are needed to meet current expenditures.
Amount of deposits.—The following table indicates the distribution
of Government deposits among the various classes of depositaries at
the close of business on June 30, 1929:
Government deposits with banks June 30, 1929
Amount of
deposits
Type of depositary
Federal reserve banks and branches . .
.
Special depositaries
Foreign depositaries:
To credit of Treasurer ofthe United States
To credit of other Government oflQcers
General depositaries:
To credit of Treasurer ofthe United States..
General and limited depositaries:
To credit of other Government olScers
.
.. .
Insular depositaries:
To credit of Treasurer of the United States
To credit of other Government oflQcers
Philippine treasury to credit ofthe Treasurer ofthe United States
Total
.
..
.
$35,891,389.40
356,841,912. 95
309,331.85
1,290,288.40
7,145,973.07
18,653,092.02
56,857.12
147,106. 94
1,001,055.41
421,337,007.10
_
Interest on deposits.—With the exception of Federal reserve banks,
all Government depositaries are required to pay interest at the rate
of 2 per cent per annum upon daily balances. The interest received
upon deposits with special depositaries during the fiscal year 1929
was $3,909,926.49, and the total received from this source from April
24, 1917, to June 30, 1929, was $81,884,909.94. Interest received
from all other depositaries during the year was $506,295.69, and the
total amount received from June 1, 1913, when this requirement
became effective, tq June 30, 1929, was $19,948,763.68.
71799—30—FI 19 29
10
GOVERNMENT ACTUARY
The office of the Government actuary during the fiscal year 1929
has kept a record of the daily market prices of all outstanding securities of the United States. The investment value of these securities,
based upon their prices, in each case, has been computed. T/hese
statistics have beeii embodied in circular form, printed and issued
as '^Government Actuary, Form A." Form A, dated July 1, 1928,
contaiued a daily record of 13 different classes of United States
bonds and three series of notes. Form A, dated June 1, 1929, also
covered 13 different classes of bonds and three different series of
notes. Of all the securities so listed, only three were pre-war issues.
In addition to circular Form A, the investment value of certain
United States bonds, and of the notes and certificates outstanding,
based upon their closing New York market price, has been computed
daily upon receipt of such quotations from the Federal Reserve
Bank of New York, by wire, immediately upon the close of the New
York Stock Exchange.
Estimates of the population of the United States have been prepared as of each month of the year. Also estimates of the population as of the 1st of July, 1929, for each State, Territory, and possession of the United States.
Numerous estimates as to the revenues of the United States have
also been made.
Numerous tables have been prepared, such as a statement of the
profit or loss on national-bank circulation, interest tables, and a
series of comprehensive amortization tables for use by the Farm
Loan Board.
Verification of numerous computations of other offices have also
been made, including verification of certain .other amortization
tables.
The actuary, as one of the Board of Actuaries connected with the
civil service retirement law, has attended the conferences of the
board and has appeared before congressional committees as a member of this board in connection with the annuities of retired employees as affected by pending legislation. The annual report of
the board was approved by this oflSice.
Extensive studies have been made of the finances of the Government, especially as to the revenues. The conclusions derived therefrom were for the use of the department and of the Congress.
Statistics of various kinds were furnished upon request during the
year to committees, to Congressmen, "to other offices, and to other
inquirers.
The personnel of the ofl&ce for the year 1929 consisted of the
actuary and two other employees.
114
DIVISION OF APPOINTMENTS
Employees of the Treasury Department
Number.—The total number of employees in the Treasury Department in Washington on August 31, 1929, was 105 less than on June
30, 1928. During the fiscal year, however, the Bureau of Engraving
and Printing put on a temporary force of approximately 600 employees
for duty in connection with the production of the small-size currency;
their services were discontinued on July 6, 1929. A further increase
in the permanent force of the Office of the Supervising Architect has
been necessary in connection with the large building program authorized by Congress. The permanent forces of the Division of Loans
and Currency and the.Internal Revenue Bureau have been further
reduced during the period covered by this report. The majority of
the other bureaus and divisions of the Treasury show slight changes
in the personnel. The number of employees in the departmental
service of the Treasury, classified according to bureaus and offices,
at the end of each month from June, 1928, to August, 1929, is shown
in Table 57, page 525, of this report.
A comparison of the number of employees in the departmental and
field services of the Treasury on June 30, 1928, and August 31, 1929,
is contained in Table 55, page 524.
Retirement.—'Emm September 1, 1928, to August 31, 1929, 280
persons were retired from the departmental and field services of the
Treasury Department, and since the retirement act went into effect
on August 20, 1920, 2,991 persons have been retired. At the present
time 150 persons above the retirement age are retained in the Treasury
Department in Washington and 617 in its field service.
Table 56, page 524, shows the number of persons retired and the
number retained in the departmental and field services of the Treasury
under the provisions of the act of July 3, 1926, amending the act of
May 22, 1920, and the amendments thereto.
Section of surety bonds
On August 31, 1929, the department had authorized 89 surety and
casualty companies to issue bonds in favor of the United States.
It is estimated that these companies are executing approximately
200,000 different bonds annually for the various branches of the
Government. According to their returns for the calendar year 1928,
these companies wrote net premiums of $523,033,847 and paid net
losses of $223,080,654. They reported combined gross assets of
$933,132,265 and liabilities over and above capital and surplus of
$568,594,072. This amount includes $25,906,829 of voluntary
reserves for contingencies. The combined capital outstanding and
115
116
REPORT ON THE FINANCES
fully paid up was reported to be $135,732,524 and surplus over alf
other liabilities of $211,720,714. Dividends paid to stockholders
amounted to $21,231,803.
No casualty and surety company reporting to this department has
failed by reason of insolvency since 1921. I t has been necessary to
request additional financing in many cases, which has always readily
been accomplished, and in some cases a complete reorganization was
effected. The department has declined the applications of some
companies which afterwards retired and liquidated because of insolvency. I t is believed that a very considerable saving to the Government as a whole is effected whenever a failure is prevented. The
failure of an insurance company writing bonds in favor of the United
States makes it necessary for all branches of the Government, field
and departmental, to take out new bonds in another company and in
addition every department of the Government must examine its
records for the purpose of ascertaining possible claims that must be
satisfied from the insolvent estate. This is an enormous task and
involves the expenditure of a very considerable sum.
BUDGET AND IMPROVEMENT COMMITTEE
.
The budget and improvement committee is responsible, under the
direction of the Undersecretary and budget officer, for the preparation and examination of Treasury estimates of appropriations and
for the improvement of administrative .methods and procedure
within the Treasury Department. In addition to examining all estimates, the committee makes inquiries as to the reserves which may
be set up under the various appropriations and considers other
matters affecting expenditures of the department. I t makes inquiries along various lines with the purpose of improving methods and
procedure, and from time to time, under special instructions, makes a
detailed examination of some particular office or service of the department. Its reports and recommendations thereon are submitted
to the Secretary of the Treasury, through the budget officer of the
department.
For the fiscal year 1931, heads of bureaus and offices submitted preliminary estimates, exclusive of interest on and retirement of the public
debt payable from ordinary receipts and the amounts for the support
of the Bureau of the Budget, aggregating $378,820,268, which included $164,671,983 for ordinary annual appropriations, $26,044,785
for permanent and indefinite appropriations and special funds,
$150,000,000 for refunding internal revenue taxes illegally collected,
$31,103,500 for public buildings construction under the act of May
25, 1926, as amended, and $7,000,000 for acquisition of land in the
so-called '^Triangle" in Washington, D. C. In accordance with the
wishes of the President that full responsibility be restored to the
heads of departments in participation with him in the maintenance
of economy in Federal expenditures, these advance estimates were,
contrary to the practice prevailing in previous years, given an exhaustive examination by the budget officer, assisted by the committee.
As a result thereof and based on his recommendations, the Secretary
of the Treasury made net deductions of $14,674,254 in the advance
estimates and approved for submission to the Bureau of the Budget
as representing the minimum requirements of the department for
the fiscal year 1931 estimates in the sum of $364,146,014, comprising
$153,106,229 for ordinary annual appropriations, $26,039,785 for
permanent and indefinite appropriations, $150,000,000 for refunding
internal revenue taxes illegally collected, $28,000,000 for public
buildings construction under the act of May 25, 1926, as amended,
and $7,000,000 for acquisition of the triangle properties.
The President allocated to the Treasury Department as a tentative
maximum for 1931 the sum of $363,680,603, which included the sum
117
118
REPORT ON THE FINANCES
of $152,640,818 for ordinary annual appropriations, all other items
being approved as submitted by the department.
The regular estimates covering ordinary annual appropriations as
submitted by bureaus and offices aggregated $153,197,311, or $556,493
above the amount allocated by the President.. In order to meet this
excess, net deductions of $467,585 were made in the estimates as submitted by bureaus and in addition the sum of $89,212 was approved
as a supplemental statement of the absolutely necessary requirements
of the department, leaving the regular annual appropriations as
approved by the Secretary for submission to, the Bureau of the Budget,
$152,640,514, or $304 under the amount of the allocation.
During the fiscal year 1929 supplemental and deficiency estimates
were submitted aggregating $93,738,727, of which $75,000,000 was
for refunds pf internal revenue taxes. After examination by the committee these estimates were revised and reduced to $92,991,631.
At the beginning of the fiscal year 1929 general reserves amounting
to $955,300 were set aside from appropriations for that year to meet
extraordinary or emergency demands that might arise. Subsequently, additional reserves of $272,000 were added and reserves
amounting to $507,800 were released, leaving a balance of $719,500
in the general reserve at the close of the fiscal year.
For the fiscal year 1930, heads of bureaus and offices recommended
reserves amounting to $739,700. After examination by the committee, $183,600 were added, making a total for the year of $923,300.
The budget and improvement committee was appointed July 8,
1922. It has examined estimates for the budgets of 1924 to 1931,
inclusive, as well as supplemental and deficiency estimates. As a
result of its examinations and on its recommendations, items aggregating $77,228,915 have been disapproved and deducted from said
estimates before they were, transmitted to the Bureau of the Budget.
OFFICE OF. CHIEF CLERK AND SUPERINTENDENT
Housing of Treasury activities
The moving of the register's office from 119 D Street NE. to the
Auditors' Building was completed in August, 1928. During the
month of March, 1929, the executive offices of the Public Health
Service were moved from the Butler Building, 2 B Street SE., into
space made available in Building C, 16 Seventh Street SW. This
move was preliminary to vacating properties on the site selected for
the new House Office Building, and brought together all of the officials
and personnel of the Washington headquarters of the Public Health
Service.
The Southern Railway Building, located at 1300 E Street NW.,
was purchased by the Government, and on notice from the railway
officials that they would vacate the building by the end of July, 1929,
. space was assigned by the Public Buildings Commission to the Bureau
of Customs and the Bureau of Prohibition, then located in Building
C. It was tentatively agreed that these activities should occupy the
first four floors.
The Federal Farm Loan Bureau moved from the old Land Office
Building, Seventh and E Streets NW., to the, Barr Building, 910
Seventeenth Street NW., in order to obtain more adequate quarters.
Space in the Albee Building, Fifteenth and G Streets NW., was
rented for a section of the Supervising Architect's Office, suflBicient
space not being available in the Treasury Building to house this
growing activity.
General improvements
Based on a special appropriation by Congress, a contract was
awarded January 18, 1929, in amount $37,215, for the installation of
four electric elevators of the latest type to replace four hydraulic
elevators which had been in use since the Treasury Building had
been constructed. These elevators are located in the northeast
corner, the southeast corner, and the west center of the building.
The northeast elevator was completely installed and put in operatibn
June 3, 1929, and work commenced on the southeast elevator.
During the flscal year 1928 a program was inaugurated for replacing
all of the old and deteriorating window sashes in the Treasury Building, and the windows on the east front of the building were renewed at
a cost of $2,962. In the latter part of the flscal year 1929 speciflcations were prepared and bids invited for renewing 243 windows in
the north and south courts.
119
120
,
REPORT ON THE FINANCES
Under special authorization from Congress the Treasurer's counting
machine room was acoustically treated at a cost of $660. This
installation has proven highly satisfactory. A further special authority of $800 is included in the appropriation act for 1930 for the purpose
of installing acoustical treatment on the ceiling of the rooms occupied
by the telegraph office.
The ventilating system on the fourth floor of the Treasury Building
was improved by additional installations.
Additional up-to-date equipment was installed in the Treasury
garage and the cabinet shop, which facilitates the work and enables
a much greater output with a slight reduction in force.
Painting
A marked improvement was the complete renovation of the entire
subbasement of the Treasury Building, which included the removal
of old calcimine and the painting of side walls, ceilings, piping, etc.
With a view to continuing improvements looking to better working
conditions, a deflnite program of interior painting which had been
commenced several years ago was carried forward throughout the
year. The cost was approximatel}^ 1 cent per square foot for all work
performed by the forces assigned to the chief clerk's office, a very
much lower figure than prices offered by outside contractors.
For preservation purposes, during the latter part of the fiscal year
a contract was awarded for painting all exterior wood and iron work
with the exception of the windows in the courts which were to be
renewed. The painting of the wood and iron work on the outside of
the Treasury Building cost $1,830, and the painting of the woodwork
in the courts cost $1,507.50.
An investigation of the particles falling from the ceiling over the
south portico developed the fact that disintegration had set in,
brought about primarily by leaks from the roof, which had developed
over a period of many years. Bids were invited for repairing the
:roof and skylight and the refinishing of the ceiling with new material.
This work will be completed during the next fiscal year.
Combined appropriations
For a great many years the chief clerk was responsible for the
administering of 12 separate appropriations to take care of the
contingent and miscellaneous expenses of the department, exclusive
of rent, with the exception of the Bureau of Internal Revenue, the
Office of the Supervising Architect, the Public Debt Service, the
Bureau of Engraving and Printing and the Bureau of Prohibition.
The estimates as prepared for the fiscal year 1930 provided one
amount, or a combination of 12 items in one. This estimate was
SECRETARY OF THE TREASTJRY
121
approved by the Bureau of the Budget and an appropriation made
by Congress in accordance therewith. The immediate saving on the
combining of these appropriations was approximately $9,000.
Sites for public buildings
The chief clerk was given special authority to act as custodian of
sites being acquired for public buildings not only in the triangle but
covering as well properties purchased on what is known as the Supreme Court site. During the fiscal year 65 pieces of property were
acquired by the Government on the Supreme Court site and 31 in
the triangle. This additional and important work is being handled
in the chief clerk's office without increase in force, and involves the
taking over of certain properties for Government use and the leasing
or renting of other properties until such time as the buildings will
be razed. The gross revenue turned into miscellaneous receipts on
this account for the fiscal year 1929 amounted to $140,388.52. These
rented properties include private dwellings, apartment houses,
garages, lunch rooms, stores, and nearly every type of business
activity.
Seville exposition
The exhibits for the international exposition to be held at Seville,
Spain, were assembled and shipped and set up at the exposition
under the direction of the department's representative.
Reports from the exposition indicate that the Treasury exhibits,
consisting of special still exhibits prepared by the Public Health
Service, and the working exhibit including printing press, etc., prepared by the Bureau of Engraving and Printing, are attracting
widespread interest; in fact the Spanish authorities have already
presented an informal request that the United States Government
allow the Public Health Service exhibit to remain in Spain for educational purposes.
Committee on simplified ofiice procedure
The chief clerk as chairman of the Treasury Department committee on simplified office procedure represented the department on
the interdepartmental board and was designated as a member of the
executive committee.
The regular monthly meetings and also special meetings were held
by the board throughout the year; and many important matters and
problems, presented to the board from the several executive departments and independent establishments as well as from the Director
of the Budget and the Chief Coordinator, were successfully handled.
COAST GUARD
The principal operations of the Coast Guard during the fiscal year
1929 and comparison with the preceding year are as follows:
L i v e s saved or persons rescued from peril
Persons on board vessels a s s i s t e d . .
Persons in distress cared f o r . .
Vessels boarded a n d p a p e r s e x a m i n e d .
Vessels seized or reported for violations of l a w . _
F i n e s a n d penalties incurred b y vessels reported
Regattas and marine parades patrolled..
_
I n s t a n c e s of lives saved a n d vessels assisted
I n s t a n c e s of miscellaneous assistance
_
Derelicts a n d other o b s t r u c t i o n s t o n a v i g a t i o n r e m o v e d
destroyed ^
Value of derelicts recovered a n d delivered to owners
Value of vessels assisted (including cargoes)
Persons examined for certificates as lifeboat m e n
1928
1929
3,983
17,383
690
65, 710
1,554
$279, 610
84
3,262
3,584
4,375
18, 725
879
80, 263
2,571
$424, 725
104
4,419
4,867
Increase
( + ) or decrease (—)
+392
+ 1 , 342
+189
+ 1 4 , 553
+1,017
+$145, 215
+20
+1,157
,+1,283
or
167
$103, 520
J9,479, 729
4,261
267
+100
$38, 200
- $ 6 5 , 320
r9,128, 375 + $ 9 , 648, 646
4,271
+10
With a single exception, every item represented in the foregoing
statement shows an increase over the preceding fiscal year, and thus
again a new record is established by the service. A very satisfactory
state of service discipline obtained during the year. There was an
appreciable decrease in major violations of discipline and in offenses
calling for punishment. The percentage of men reenlisting upon
expiration of enlistment has gradually increased in recent years,
indicating a commendable esprit de corps and a high standard of
morale.
.
Protection to navigation
Ice patrol.—During the season of 1929 the international service of
ice patrol was carried on by the Coast Guard cutters Tampa and
Modoc, based on Hahfax, Nova Scotia, with the Coast Guard cutter
Mojave as the stand-by vessel. The Tampa left Boston, Mass., on
April 1, 1929, to inaugurate the patrol. The Tampa and the Modoc
each spesnt foiir full 15-day periods, alternately, in the ice regions.
The two cutters cruised a total of 23,249 nautical miles during the
season, including the distance run in going to and from the base.
Sixty-nine oceanographic stations were occupied during the season
from time td time as opportunity offered. The magnitude and importance of the communication work are reflected in the following
summary of operations, in part, of the patrol for the season:
Number of routine broadcasts transmitted (during most of the season
these messages averaged about 400 words each)
984
Number of water temperature and weather reports received
7, 225
Number of ice and obstruction reports received by radio
2, 279
Number of different vessels that cooperated with the patrol by sending
in reports
539
Total number of words transmitted and received by radio
807, 737
122
SECRETARY OF THE TREASURY
123
As in previous seasons, the most gratifying cooperation was had
from ship stations in and near the ice regions. A commissioned
officer of the Coast Guard was detailed to accompany the cutters
throughout the patrol as oceanographer. The patrol was in progress
at the close of the flscal year.
The Marion expedition.—In pursuance of the recommendations of
the interdepartmental board on international service of ice observation, ice patrol, and ocean derelict destruction, and in conformity
with the terms of the International Convention on the Safety of
Life at Sea, under which the Government of the United States was
invited to undertake the management of this triple service, the commandant of the Coast Guard decided to send a vessel on a special
cruise to make an oceanographic survey of the waters between the
western coast of Greenland and Labrador in connection with the
study of ice conditions in the North Atlantic. Lieut. Commander
E. H. Smith, United Sates Coast Guard, was assigned to the command of the expedition, and the 125-foot Coast Guard patrol boat
Marion was selected to make the cruise. Lieut. N. G. Ricketts,
United States Coast Guard, was assigned to duty with the expedition. Lieutenant Commander Smith was directed to make the
survey mentioned covering such stations as he might find feasible, to
make such ice observations as would be of value, to make such
meteorological observations and take such soundings as practicable
in the interest of science and navigation, and to record any information regarding the region that would be of interest to science and to
the pubhc generally.
The Marion sailed from Boston, Mass., July 11, 1928, on this duty,
and returned, arriving at New London, Conn., on September 18, 1928.
A preliminary report of the cruise has been received. When the fullreport embodying the results of the expedition is received, the whole
matter will be placed before the interdepartmental board, which will
give it most careful consideration.
Winter cruising.—The President each year designates certain Coast
Guard vessels to perform special cruising upon the coast in the season
of severe weather, usually from December 1 to March 31, to afford
such aid to distressed navigators as their circumstances may require.
On November 5, 1928, the President, upon the recommendation of
the Secretary of the Treasury, designated the Coast Guard cutters
Ossipee, Tampa, Mojave, Acushnet, Tusca7'ora, Seneca, Seminole,
Gresham, Manning, Carrabasset, Modoc, and Yamacraw to perform
this duty for the season of 1928-29. The Modoc and the Tampa
were withdrawn from this duty and assigned to the international ice
patrol.
In the prosecution of their winter cruising duties, the cutters cruised
nearly 66,000 miles, afforded assistance to 17 vessels, whose values.
124
REPORT ON THE FINANCES
including their cargoes, amounted to more than $10,000,000, and on
board which vessels there were 400 persons; rescued 69 persons from
peril; removed or destroyed 11 derelicts; and boarded and examined
340 vessels in the interests of the enforcement of United States laws.
Removal of derelicts.—In the course of the year 267 derelicts and
other floating dangers and obstructions to navigation were removed
from the paths of marine commerce by the vessels and stations of the
service. The estimated value of property involved, where values are
given, amounted to $38,200.
Anchorage and movements of vessels.—The Coast Guard during the
year continued the enforcement of the rules and regulations governing the anchorage and movements of vessels at the larger ports of the
country where Federal regulations are in effect, and at other places
where maritime conditions are such as lo require supervision. Coast
Guard officers continue to serve as captains of the port at a number
of places. . The duty has been performed efficiently by the Coast
Guard and to the satisfaction of the maritime interests.
Regattas.—The Coast Guard through the agency of its vessels and
stations patrolled and supervised during the year in various parts of
the country 104 regattas, marine parades, and boat races. A number
of other events of like character of local interest were also attended
and supervised informally by service units.
Flood relief service
In March, 1929, Coast Guard forces were called into action to do
again a work that has formed a conspicuous part of its history for
nearly a half century. Regions of Alabama, Georgia, Florida, and a
small section of Mississippi were in the hold of a disastrous flood.
Upon learning of the situation the Coast Guard immediately dispatched personnel and boats from Coast Guard section base 15 at
Biloxi, Miss., and the Santa Rosa Coast Guard station, near Pensacola, Fla., into the flooded areas up the Choctawhatchee River.
Acting in cooperation with the Red Cross, the State and local authorities, the Army, and citizens, the Coast Guard set about its work
of rescuing the imperiled and taking them to places of safety, delivering food, supplies, blankets, clothing, and medicines to the
destitute and needy refugees, building tents,, establishing camps,^
ferrying people across dangerous washouts, setting up means of communication, improvising temporary bridges, and doing whatever else
it could to relieve the unfortunate situation. The work of the Coast
Guard on the occasion has brought forth high commendation.
SECRETARY OF THE TREASURY
125
Enforcement of customs and other laws
The duties of the Coast Guard in connection with the enforcement
of the customs laws of the United States and the navigation and
motor boat laws were satisfactorily performed during the year. The
general enforcement of the customs laws by the Coast Guard is supplemented each year by the assignment of harbor cutters of the service
at the principal ports to aid the customs authorities in boarding
incoming vessels and in performing other duties relating to the
customs.
Liquor smuggling.—The law enforcement work of the Coast Guard
for the prevention of smuggling of liquor into the United States from
the sea progressed very satisfactorily during the year and was accompanied by gratifying results. This matter continues to be one
requiring the utmost vigilance and attention at all times. There is
no doubt that any lessening of service forces at this time would be
followed by an immediate and corresponding increase in liquor
smuggling. Some liquor smuggling is still going on along the seaboard, and there remains a considerable amount of such smuggling
on the Great Lakes, where smuggling operations are very active.
The service is doing all, in every quarter, that can be done with its
present resources.
Cruises in northern waters.—The Coast Guard cutters Haida,
Unalga, Northland, and Snohomish conducted during the season of
1928 the regular annual patrol of the waters of the North Paciflc
Ocean, Bering Sea, and southeastern Alaska for the enforcement of
the convention of July 7, 1911, between the United States, Great
Britain, Russia, and Japan and the laws and regulations for the protection of the fur seal and sea otter and of game, the flsheries, and
fur-bearing animals of Alaska. In the prosecution of their duties the
cutters cruised approximately 43,000 miles, assisted 13 vessels in
distress, afforded medical and dental aid to 464 persons, transported
358 persons, and boarded 74 vessels in the interests of the enforcement
of the United States laws.
The patrol for the season of 1929, now in progress, is being carried
on by the Coast Guard cutters Chelan, Unalga, Haida, Northland,
and Snohomish.
Northern Pacific halibut fishery.—The annual duty of patrolling the
waters off the coast of Washington and southeastern Alaska in the
interests of the enforcement of the law with respect to halibut
fishing was performed in the flscal year 1929 by the Coast Guard
cutters Unalga and Snohomish. The Unalga was engaged in the work
from November 17 to 20, 1928, and the Snohomish cruised at intervals
on the duty from November 20, 1928, to February 5, 1929. This
work is performed in behalf of the Bureau of Fisheries, Department
of Commerce.
126
REPORT ON THE FINANCES
Communications
The communications service is concerned with the provision, construction, maintenance, and operation of all communication facilities
of the Coast Guard, the design and development of materials, and the
instruction and training of the personnel connected therewith. The
methods of communication in the Coast Guard are in general the
telegraph, telephone, radiotelegraph, radiotelephone, radiocompass,
visual signals, and underwater sound signals.
Telephones and cables.—The Coast Guard owns and operates a
coastal communication system consisting of a telephone line system
of approximately 2,650 miles in length, including about 490 miles
of submarine cable. The system comprises about 185 separate and
distinct telephone lines of varying lengths, each connecting wdth the
commercial telephone exchange, thus affording local and long distance service for all Coast Guard stations and a large number of other
Government agencies, including certain lighthouses, naval radiocompass stations, and Weather Bureau stations.
/
On account of the congestion of Government and commercial telephone and telegraph wires in the vicinity of Cape Henry and Virginia
Beach, Va., it became necessary to rearrange the entire Coast Guard
system of circuits with the resultant use of aerial telephone cable in
place of open wires. Adequate telephone service is thus now provided
within this entire area, including Norfolk, Va. .
During the year new telephone communication facilities were
provided the Galveston Coast Guard station on Pelican Spit, across
the channel from Galveston, Tex. The United States Public Health
Service desired telephone communication with the island in connection with its operations. A rebuilding of the Government electric light circuits from Galveston to the Government agencies on
Pelican Spit also became necessary. Legislation was obtained which
provided that the necessary funds be transferred to the Coast Guard
to carry out the work. This work was completed during the year
and both the Public Health Service and Coast Guard are now provided with excellent telephone and electric light service, all of which
was obtained through the erection of a joint pole line, telephone
and electric light wires, and cables.
A program has been inaugurated toward a more scientiflc study
and investigation of all telephone circuits with a view of improving
the quality of transmission and increasing the distances over which
reliable communication can be had.
Radio.—All vessels of the Coast Guard, excepting certain small
ones, are equipped with radio apparatus of a type appropriate to
the duties they perform, so that they may have rapid radio communication with the vessels at sea. Twenty-flve radio shore stations have
been established at various headquarters and bases to handle ship*
SECRETARY OF THE TREASURY
127
shore inter-Coast Guard traffic, particularly in connection with
patrol boats.
The program for modernization of the. radio equipment of vessels
and other units, begun a few years ago, was completed during the
year. The close of the year finds every vessel of the service, excepting
small patrol boats, equipped with radio direction-finding apparatus
commonly referred to as the radio compass.
The use of. aircraft in the Coast Guard has brought with it radio
problems peculiar to that type of ship and its mission. Study of
these matters is progressing satisfactorily and expeditiously.
An officer of the Coast Guard continues to represent the Treasury
Department on the interdepartmental radio advisory committee,
which committee coordinates certain governmental activities and
acts in an advisory capacity to the Secretary of Commerce.
International Telegraph Conference.—At the request of the Department of State the Coast Guard sent a representative (Lieut. E. M.
Webster) to observe the proceedings of the International Telegraph
Conference which met in Brussels, Belgium, September 10, 1928.
Safety of Life at Sea Conference.—In April, 1929, the Safety of Life
at Sea Conference was held in London, England. Lieut. E. M.
Webster was designated by the Department of State as technical
assistant to the delegation from the United States appointed by the
President. This conference was of particular interest to the Coast
Guard, especially in its relation to the subjects of radio and the
international ice patrol.
Training of communication personnel.—Efforts are being continued
to improve the professional qualifications of this personnel. During
the year 8 radio men (enlisted men) and 2 radio electricians (warrant
officers) of the Coast Guard were graduated from appropriate radio
schools operating under the Navy, and 3 men of the coastal communication system were graduated from the telephone school of the Army
Signal Corps. Radio men have also been trained at the Coast Guard
Radio School at New London, Conn. The helpful cooperation of
the Army and Navy in this matter is acknowledged.
Eguipment
.•
Floating equipment.—On June 30, 1929, there were in the Coast
Guard in commission 21 cruising cutters of the first class and 15 of the
second class, 24 Coast Guard destroyers, 38 harbor cutters and harbor
launches, thirty-three 125-foot patrol boats, thirteen 100-foot patrol
boats, one hundred and ninety-four 75-foot patrol boats, 13 other
patrol boats, 75 cabin picket boats, and 32 open picket boats. The
above-itientioned floating equipment does not include the primarily
life-saving boat equipment attached to Coast Guard cutters and
stations.
128
REPORT ON THE FINANCES
During the year 5 of the 10 cutters authorized by the act approved
June 10, 1926, were completed and placed in commission. They
were built under contract by the Bethlehem Ship Building Corporation (Ltd.), at the Fore River plant, Quincy, Mass., and were named,
respectively, Chelan, Pontchartrain, Tahoe, Champlain, and Mendota,
Appropriation having been made therefor, contract was entered
into on March 16, 1929, with the General Engineering & Dry Dock
Co., Oaldand, Calif., for the construction and equipment of 3 more
of the 10 cutters. The work on these three cutters is progressing
satisfactorily. Appropriation has also been made to commence
the ninth of the 10 cutters. The design plans and speciflcations for
this cutter are weU under way.
During the year the Tamaroa was reconditioned and moderi^ized
under contract at a private shipyard, and cable-handling machinery
was installed on the Pequot under contract.
Aviation.—In the course of the year the 5 seaplanes acquired by the
Coast Guard in the flscal year 1927 cruised 56,395 miles, searched
a total area of 945,275 square miles, and identifled 5,113 vessels at
sea. This cruising was of great value in deteicting liquor and alien
smugglers on the Atlantic coast and in searching for lost flshermen,
disabled vessels, and distressed aircraft. The ability of aircraft to
serve many uses of the Coast Guard is qf such importance as to warrant the acquirement of additional planes of greater cruising radius.
On May 1, 1929, the Coast Guard established the flrst link of a
coastal checking system designed to assist all aircraft using the
coastal routes and particularly to note the departure and arrival of
aircraft making extended flights over the coastal estuaries. Prior
to the date named airplanes making long over-water flights undertook
the flights generally without cognizance of any agency capable of
affording immediate assistance in case of disablement. Through
the S3^stem inaugurated by the Coast Guard stations, any pilot.or
owner may have a plane or planes under almost continuous observation from New York to Miami, Fla., provided the planes follow the
coastal route, and be "assured that in case of accident prompt assistance
wiU be rendered by the nearest Coast Guard station. During the first
two months this service was in operation 329 planes were checked by
Coast Guard stations. This service has been developed without cost
to the Government and is proving of great use to aircraft. With the
growth of commercial aviation doubtless it will be advisable to extend
this checking system to the entire coast fine of the United States.
Ordnance.—Very gratifying progress was made during the year,
along ordnance lines, and the training of personnel in this relation was
attended by most satisfactory results. Every effort has been made to
maintain the ordnance equipment in the best possible manner and to
increase the efficiency of the Coast Guard along gunnery lines.
SECRETARY OF THE TREASURY
129
More units held gun target practice and smaU-arms target practice
than ever before. They show a marked improvement both in scores
attained and in general performance. Of destroyers and first-class
cutters, 87 per cent conducted the prescribed gun-target practice and
85 per cent held small-arms target practice. While the percentage of
smaller vessels and the stations carrying out the practices has not been
so large, the general increase over last year indicates that a lively
interest in this branch of training has developed throughout the
service and that earnest efforts are being made to attain the highest
degree of efficiency.
Four classes of warrant gunners, each consisting of four men, have
been detailed to the Naval Gun Factory at Washington, D. C , for a
three months' course of instruction, and one enlisted man took the
armorer's course at the Marine Corps depot at Philadelphia, Pa.
Nine vessels of the Coast Guard, including the five new cutters,
now carry 5-inch guns. This materially increases the military value
of these vessels as a part of the Navy in time of national emergency.
The new cutters are the first vessels of the -Coast Guard to carry
3-meter base range finders, the largest heretofore furnished being
1-meter base instruments.
The target range at Cape May, N. J., referred to in last year's report,
has been completed. The cooperation of the Army, Navy, and Marine Corps in ordnance matters of the Coast Guard has been of great
value.
The academy, stations, bases, repair depot, etc.
Coast Guard Academy.—There were 73 cadets under instruction at
the Coast Guard Academy at New London, Conn., at the close of
the fiscal year. The resignations of 12 cadets were accepted and
1 cadet w^as dismissed during the year. In May, 1929, 28 cadets
were graduated, and commissions thereupon were issued to them as
ensigns. Entrance examinations of candidates for cadets were held
June 26, 1929, and as a result of these examinations 65 appointments
have become effective.
As stated in last year's report, the practice cruise for 1928 of the
Alexander Hamilton and the Coast Guard destroyer Shaw was in
progress at the close of the fiscal year 1928. These vessels visited
London, England; Antwerp, Belgium; Cherbourg, France; Coruna,
Spain; Casablanca, Morocco; Gibraltar; Funchal, Madeira; and.
Hamilton, Bermuda, arriving at the academy on their, return voyage
August 24, 1928.
The Coast Guard cutters Champlain and Mendota are being outfitted for the practice cruise for 1929, and it is expected that this
cruise will begin early in July and extend to the latter part of August.^
71799—30—FI 192 9
11
130
REPORT ON THE FINANCES
An act approved February 16, 1929, provides: ^'That the Secretary
of the Treasury be, and he is hereby, authorized to acquire in fee
simple avithout cost to the United States a suitable site at New London,
Conn., and to construct and equip thereon such buildings and appurtenances as he may deem necessary for the purpose of the United
States Coast Guard Academy, all at a total cost not to exceed
$1,750,000, which amount, or so much thereof as may be necessary,
is hereby authorized to be appropriated."
Under the provisions of the second deficiency act, fiscal year 1929,
approved March 4, 1929, $10,000 was appropriated, to remain
available until expended,-^4*or the preparation of the plans, drawings,
etc.," the work to be performed by the Office of the Supervising
Architect.
I t is hoped that these preliminaries may be brought to early completion and that funds be appropriated so that the necessary steps
looking to the actual construction of the buildings may be taken.
The physical conditions at the academy, as has been pointed out
for several years past, are most unfavorable and should not be permitted to so continue any longer than is absolutely necessary.
The site has been acquired without cost to the Government. The
legislation is a great forward step for the betterment of the Coast
Guard and for the comfort, contentment, and morale of the young
men who enter the academy to be trained as officers.
Stations and bases.—On June 30, 1929, there were 252 Coast Guard
(life-saving), stations in an active status. There were 1 floating
section base (Wayanda, hsise 18), 1 destroyer floating flag office
(Argus), 15 shore section bases, and 2 subbases established for lawenforcement purposes. The seryice craft attached to these bases
operate primarily against smuggling activities.
Rebuilding,, repairs, improvements, alterations, and additions,
extensive and minor in character, were completed during the year at
147 Coast Guard (life-saving) stations; 11 section bases; in certain
Coast Guard divisions; at the academy; destroyer force; depot,
Curtis Bay, Md.; Wilmington, N. C.; and certain radio stations.Contracts were awarded or work was begun, within the year for
rebuilding, repairs, improvements, alterations, and additions at eight
Coast Guard (life-saving) stations and two-section bases.
The Coast Guard station authorized by law to be established on the
coast of Lake Superior, in Cook County, Minn., was completed
during the year and placed in commission on May 10, 1929. The
station has been named North Superior, and is located at Grand
Marais, Minn.
Very unfavorable conditions obtain at a number of Coast Guard (lifesaving) stations due to the age, usage, inadequacy, or absence of modern facilities and conveniences. This situation should be remedied.
SECRETARY OF THE TREASURY
131
Repair depot.—The following-named Coast Guard vessels were
overhauled at the Coast Guard repair depot at Curtis Bay, Md.,
during the year: Apache, Carrabasset, Cliulahoma, Guthrie, Mascoutin,
Pequot, Saukee, Seminole, Seneca, and Winnisimmet. Alterations
and repairs were undertaken at the depot on eighteen 125-foot
patrol boats, three 100-foot patrol boats, and four 75-foot patrol
boats, and the AB-9 was converted into a cable boat.
The boat building shop at the depot constructed 116 standard boats
for service use, among which were four 36-foot 6-inch motor lifeboats.
This type of boat is a new design representing the latest and most
modern developments in motor lifeboats. It has an over-all length
of 36 feet 6 inches, a 10-foot beam, and a draft of approximately 3
feet 3 inches. There is installed an 83-horsepower 6-cylinder engine,
which will propel the boat at approximately %]-{ statute mhes per hour.
This type of boat is self-righting and self-bailing and is provided with a
forward cabin for the protection of the crew and shipwrecked persons.
One of these boats has been subjected to exhaustive tests and found
satisfactory. The boat was designed at Coast Guard headquarters.
The manufacture of small supplies for use in the service was continned by the depot during the year.
Personnel
On June 30, 1929, there were on the active list of die Coast Guard
333 regular commissioned officers, 62 temporary commissioned
officers, 73 cadets, 77 chief warrant officers, 389 regular warrant
officers, 402 temporary warrant officers, 10,837 enhsted men, and.
242 civilian employees in the field, of which 206 were per diem
civilian employees at the Coast Guard depot, Curtis Bay, Md.
Recruiting.—The recruiting service of the Coast Guard on June 30,.
1929, comprised 9 main stations and 35 substations located at vaiious
places in the country. During the fiscal year 1929 there were 11,176'
applicants for enlistment, of which number 2,481 were enhsted,
4,636 rejected for phj^sical disability, and 4,059 rejected for otherdisabling causes. The large number, of rejections for causes other
than physical defects was due to a great extent to the procedure
followed in investigating applicants for enhstment. Every effort is.
made to secure only those men for enlistment who are desirable in.
all respects. While the investigation of apphcants has perhaps increased the number of rejections, it has materially reduced the number
of desertions and early discharges. By thus safeguarding against theentry of undesirables the service morale has been improved. Many
recruits enlisting during the year were trained at the Coast Guard,
receiving unit at New London, Conn., which is maintained for the^
purpose.
132
REPORT ON THE FINANCES
On June 30, 1928, the enlisted men in the Coast Guard numbered
10,392. At the close of the fiscal year 1929 there were 10,837 enlisted
men in the service, an increase of 445.
Welfare.—The recreation and welfare program of the service is
conducted always with the purpose in mind df accomplishing the
greatest good with the funds available for expenditure. I t has not
been possible on account of limited funds to make unit allotments of
sufficient size to cover the cost of the larger items of recreation equipment. A great many units, particularly the Coast Guard (lifesaving) stations, have been furnished radio receiving sets, and several
cutters and bases have been equipped with motion-picture projectors.
The requests for such items and for athletic equipment have been
numerous. A most prominent feature of the year's work along educational fines has been the establishment of the Coast Guard Institute,
a correspondence school, at New London, Conn. I t is conducted
under the supervision of the superintendent of the Coast Guard
Academy. The school is patterned after the Marine Corps Institute.
Since the inauguration of this system of instruction about 850 enlisted
men have enrolled for courses and more than 9,000 papers have been
submitted for marking and grading. The men have enthusiastically
taken hold of this opportunity to increase their general and professional knowledge.
The Coast Guard expresses its grateful appreciation of tlie assistance the Marine Corps has extended toward the establishment of
this school. The interest and cooperation of the Bureau of Navigation, Navy Department, in furnishing rating courses for enlisted men
and motion-picture film service to many units, and extending other
courtesies, are also gratefully acknowledged.
In view of the lively interest manifested by the men in the various
means of recreation and education, and as the efficiency of the service
so largely depends upon the contentment, happiness, and morale of
its personnel, the hope is expressed that means will be found to extend
the scope of the welfare program.
Awards qf life-saving medals
Under the provisions of law the Secretary of the Treasury awarded
during the year 57 life-saving medals of honor (14 gold and 43 silver)
^nd I second service silver bar in recognition of bravery exhibited in
the rescue or attempted rescue of persons from drowning in waters
over which the United States has jurisdiction or upon an American
^«t^ssel.
133
SECRETARY OF THE TREASURY
Appropriations, expenditures, and balances
The appropriations available for the Coast Guard for the fiscal year
1929, the expenditures therefrom, and the balances are as follows:
Title of appropriation
Salarie.s, office of Coast Guard, 1929
Pay and allowances,. Coast Guard, 1929
Fuel and water. Coast Guard, 1929
Outfits, Coast Guard, 1929
Rebuilding and repairing stations, etc., Coast Guard, 1929.
Mileage, etc.. Coast Guard, 1929
c
L...
Draft animals, Coasc Guard, 1929
Communication lines. Coast Guard, 1929
Civilian employees, Coast Guard, 1929
Contingent expenses, Coast Guard, 1929
Repairs to Coast Guard vessels, 1929
Construction and equipment of Coast Guard cutters, 1929.
Construction and equipment of Coast Guard cutters,
1929 and 1930
Establishing Coast Guard stations
Establishing Coast Guard stations, 1929 and 1930
Seaplanes, Coast Guard, 1929 and 1930
Coast Guard Academy
Appropriation
Expended and Unobligated
obligated
balance ^
$283,260.00
18,983,400.00
2,732,800.00
000.00
500,000.00
390,000.00
24,000.00
60,000.00
79,616.00
270,000.00
2,038,600.00
1,134,ooo: 00
$282,629.95
18,656,342.43
2, 362,718.62
1,809,827.32
491,592.90
353,046.72
22,564.92
57,290.87
79,303.11
263,201.22
2,017,744.42
1,107, 166.85
500,000.00
19,405.49
34,770.00
500,000.00
19,405.00
24,369.31
144,000.00
10,000.00
49.11
$630.05
327,057.57
370,081,38
88,172. es8,407.10
36,953.28
1,435.08
2,709.13
312. 89
6,798.78
20,855.58
26,833.15
.49
10,400. 69
144.000.00
9,950.89
COMPTROLLER OF THE CURRENCY
Nfational banks organized, consolidated, insolvent, in voluntary liqui'
'
dation, and in existence
From the inauguration of the national banking system in 1863
t o June 30, 1929, charters have been issued to 13,346 national banking associations, of which 7,587 are in existence. By reason of liquidations, consolidations, and failures, 5,759 associations have been
terminated.
The authorized capital of the banks in existence on June 30, 1929,
was $1,635,308,915, an increase during the fiscal year of $37,301,300.
While charters were issued during the year to 126 associations, there
was a net decrease of 158 in the number of banks—that is, from 7,745
to 7,587—by reason of voluntary liquidations, receiverships, and
consolidations.
Summaries of operations during the last year relating to the number
and capital of national banks organized, increases and reductions of
capital, with number of national banks organized under various acts
of Congress and number closed for various reasons during the existence
of the system, together with the number organized, consolidated,
failed, liquidated, and in existence in each State and geographical
division, are shown in the statements following:
Organization, capital stock changes, and liquidations of national banks during the
fiscal year 1929
Total
Number
ol
banks
Capital
Charters granted.
Increases of capital (303 banks ')Restorations to solvency
126
$34,340,000
142,652,925
60,000
Voluntary liquidations
Receiverships 2
_
_
Decreases of capital (24 banks;)
Closed under consolidation act of Nov. 7, 1918, and
amount of capital decrease incident thereto
187
71
85,286,000
5,960,000
46,500,000
34
3,840,625
Number
of banks
128
Capital
$177,052,925
140,586, 625
^ e t decrease in banks
Net increase in capital
-Charters in force June 30, 1928, and authorized capital.
7,745
37,301,300
1,598,007,616
Charters in force June 30, 1929, and authorized
capital
7,687
1,635,308,915
158
1 Includes 6 increases aggregating $10,003,925, which were effected as a result of consolidations under the
:act of Nov. 7,1918, and 23 Increases aggregating $45,268,333, incident to the consolidation of State banks with
national banks under the act of Feb. 25,1927, and 75 increases by stock dividends aggregating $20,201,750.
2 Includes 6 banks with aggregate capital of $835,000, which had been previously reported in voluntary
liquidation.
134
135
SECRETABY OF THE TEEASURY
Number of national banks organized since February 25, 1863, number passed out of
the system, and number in existence June 30, 1929
Organized under—
Act of Feb. 25, 1863
Act of June 3, 1864_..
Gold currency act, July 12, 1870
Act Mar. 14, 1900
.
456
8,216
10
4,664
.
Total number of national banks organized
Voluntary liquidations
Expirations of corporate existence
Consolidations under act Nov. 7, 1918
Receiverships, exclusive of those restored to solvency
13, 346
4, 085
208
245
1, 221
Total number passed out of the system
5, 759
Number now in existence
7, 587
Number of national banks organized, consolidated under act November 7, 1918, insolvent, in voluntary liquidation, and in existence on June 30, 1929, by States, etc.
Organized
States, etc.
Maine
New>Hampshire
Vermont-1
Massachusetts.._
Rhode Island
Connecticut
113
• 74
77
353
65
119
.-•
_
_
17
35
365
384
35
12
25
1
4
52
10
54
1
2
4
291
58
211
12
43
10
565
299
862
17
82
12
. . .
2,662
77
123
625
1,837
11
4
3
5
4
1
..
236
164
130
113
170
115
162
69
86
1,058
125
232
194
8
9
17
21
22
26
13
• 4
8
70
15
6
11
52
34
36
33
64
3142
29
42
351
32
81
79
165
117
' 74
54
80
57
107
35
34
625
77
138
99
_
..•
.
Total Southern States . .
Ohio
Indiana
Dlinois-_.
Michigan .
Wisconsin
Minnesota..!
I6wa__
Missouri
.. .
.'..
.
Total Middle States.
North Dakota
South Dakota
Nebraska
Kansas
. .
.. .
53
56
46
155
10
64
943
379
1,152
30
• 128
30
_
.
59
13
23
174
51
45
801
_
Total Eastern States '. .
'
2
4
Total New England States
Virginia
.
West Virginia
North Carolina..
South Carolina
Georgia
Florida
Alabama
Mississippi
Louisiana
Texas
Arkansas
Kentucky
Tennessee
'
1
1
1
In existence
4
7
16
2
6
i...
New York
New Jersey • _.
Pennsylvania
Delaware
Maryland
_
District of Columbia
Consolidated
liquiunder act Insolvent In
dation
Nov. 7,
1918
.
i
2,854
2
12
1
7
5
66
230
906
1,662
637
402
714
268
241
455
504
274
19
7
4
2
4
5
3
8
40
28
35
18
14
68
96
17
253
143
186
115
66
105
140
115
325
224
489
133
157
277
265
134
3,495
52
316
1.123
2,004
246
206
361
435
2
1
1
4
66
62
50
49
50
47
150
134
128
96
160
248
136
REPORT ON T H E FINANCES
Number of national banks organized, consolidated under act November 7, 1918,
insolvent, in voluntary liquidation, and in existence on June 30, 1929, by States,
etc.—Continued
Consolidated
liquiOrgan- under
act Insolvent In
dation
ized
Nov. 7,
1918
States, etc.
Montana..
Wyoming
Colorado
New Mexico
Oklahoma
^
.
.^
Total Western States
Washington
Oregon .
California
Idaho
Utah
Nevada . . .
Arizona
.
.
Total Pacific States
Alaska
Hawaii..
Porto Rico._
1
Total Alaska and Island Possessions. .
Total United States
.
In existence
5
63
12
28
24
57
55
19
52
26
342
69
26
122
28
312
18
411
875
1,189
207
138
492
108
38
16
30
10
.1
12
32
14
24
27
4
2
,3
58
30
241
37
12
4
11
107
93
215
44
20
10
16
1,029
25
106
393
505
1
4
1
4
2
189
57
205
78
716
3
2
2,493
2
5
6
1
12
13, 346
1,221
245
6
6
4,293
7,587
Condition qf national banks
A summary of the resources and liabilities of national banks in
the continental United States, Alaska, and Hawaii on June 29, 1929,
as compared with June 30, 1928, is as follows:
Summary of condition of national banks on June 30, 1928, and June 29, 1929
[In thousands of dollars]
June 30,
1928
Classification
Number of banks
. .
_.
7,691
June 29,
1929
7, 536
Increase
(+) or decrease (—)
—155
RESOURCES
Loans and discounts, including rediscounts
Overdrafts..
_. .
United States Government securities owned..
Other bonds, stocks, securities, etc., owned-. . . .
Customers' liability account of acceptances
Banking house, furniture and
fixtures
_.
Other real estate owned
Reserve with Federal reserve banks
Cash in vault
._
Due from banks
Outside checks and other cash items
, .
Redemption fund and due from United States Treasurer..
Acceptances of other banks and bills of exchange or drafts sold with
indorsement
Securities borrowed. :
..
Other resources
Total
14, 917, 250 14, 801,130
10,138
10,193
2, 891,167 2, 803,860
4, 256, 281 3, 852, 675
414, 573
397, 333
721, 229
747, 684
125, 680
118,839
1, 453, 383 1, 344, 951
315,113
298,003
2, 748, 932 2, 569,098
100, 367
70, 095
33, 050
32, 740
-116,120
^ +55
-87, 307
-403, 606
-17,240
+26,455
—6,841
— 108,432
-17,110
— 179 834
-30, 272
-310
227, 745
21, 235
272,096
164, 866
20,186
208, 575
-62,879
-1,049
-63, 521
28, 508,239
27,440,228
-1,068,011
137
SECEETARY OF THE TEEASUEY
Summary of condition of reporting national banks on June 30, 1928, and June 29,
1929—Continued
[In thousands of dollars]'
June 30,
1928
Classification
June 29,
1929
Increase
(+) or decrease ( - )
LIABILITIES
Capital stock paid in
1.593,856
1, 627, 375
1.419,695
Surplus fund
1,479, 052
Undivided profits—net
1
> 557,437
568, 336
Reserves for dividends, contingencies, etc
83, 753
73, 968
Reserves lor interest, taxes, and other expenses accrued and unpaid.
649,095
649,452
National-bank notes outstanding
2, 738,017
2,175, 932
Due to banks..
.
414, 971
354, 253
Certified and cashiers' checks outstanding
17,934
IS, 297
• Cash letters of credit and travelers' checks., outstanding
11, 003, 795 10, 504, 268
Demand deposits
8, 296, 638 8,317,095
Time deposits (including postal savings)
185, 916
228, 243
United States deposits
:
£2, 657,271 21,698,088
Total deposits
21, 235
20,186
Securities borrowed
.7,217
49, 660
Agreements to repurchase securities sold...
714, 507
801,185
Bills payable and rediscounts
Acceptances of other banks and bills of exchange or drafts sold with
227, 745
164,866
indorsement
411, 763
392, 623
Acceptances executed for customers
19,173
18, 648
Acceptances executed by other banks for account of reporting banks
58,814
83, 467
Other liabilities
28, 508, 239 27,440, 228
65.84
68.53
Total
Ratio of loans and discounts to total deposits (per cent)
+33, 519
+59, 357
+10,899
- 9 , 785
+357
-562, 085
-60, 718
+363
-499, 527
+20,457
+42, 327
-;, 059,183
-1,049
+42,443
-86, 678
-62,879
-19,140
-525
+24,653
-1,C 8, Oil
2.69
The resources and liabilities of the national banks on the date of
each report since June 30, 1928, are shown in the following statement:
Abstract of reports of condition of national banks at the date of each report since
June 30, 1928
[In thousands of dollars]
Classification
June 30,
1928—
7,691
banks
Oct. 3,
1928—
7,676
banks
Dec. 31,
1928—
7,635
banks
Mar. 27,
1929—
7,575
banks
June 29,
1929—
7,536
banks
RESOURCES
Loans and discounts (including rediscounts)' 15,144,995 15,116,869 215,279,631 2 14,849,926 214,801,130
11, 638
12,257
Overdrafts
10,138
15, 606
10,193
United States Government securities
2,891,167
3,012, 584 3, 008, 723 3, 096,760
2,803,860
owned
.3,852, 675
Other bonds, stocks, securities, etc., owned. 4,256,281 4,104,022 4,118, 595 3,973, 995
397, 333
429,034
531, 305
472,486
Customers' liability account of acceptances.
414, 573
730,182
747, 684
732,455
726, 267
Banking house, furniture and fixtures
721,229
122,773
123,050
118,839
126,903
Other real estate owned
125, 680
1,344,951
1,467, 535 1,496, 316 1,404, 528
Reserve with Federal reserve banks
1,453,383
Items with Federal reserve banks in
448,182
567,942
process of collection
(3)
(3)
(3)
388,129
363,491
364,281
298,003
315,113
Cash in vault
' 1, 020,320
Amount due from national banks
1, 556, 235
Amount due from other banks, bankers,
4,184, 693 3,385, 661
2, 569,098
417,465
and trust companies
756,176
Exchanges for clearing house...
989, 920
106,789
Checks on other banks in the same place..
100, 367
99, 213
116,187
72,290
70,095
Outside checks and other cash items
Redemption fund and due from United
32,740
33,426
32,786
33,261
33,050
States Treasurer.
Acceptances of other banks and bills of ex164,866
329,764
247,867
change or drafts sold with indorsement..
1 Includes customers' liability under letters of credit.
2 Excludes "Acceptances of other banks and bills of exchange or drafts sold with indorsement," now
shown separately.
8 Included in aggregate amount of due from banks.
138
REPORT ON THE FINANCES
^.bstract of reports of condition of national banks at the daie of each report since
J u n e 30, 1928—Contmued
[In thousands of dollars]
June 30,
1928—
7,691
banks
Classification
Oct. 3,
1928— .
7,676
banks
Dec. 31,
1928—
7,635
banks
Mar. 27,
1929—
7,575
banks
June 29,
1929—
7,536
banks
RESOURCES—continued
United States Government securities borrowed
Bonds and securities, other than United
States, borrowed...
Other assets
,
17,877
18,545
20, 472
35,425
20,186
295, 205
217,045
221, 270
208, 575
• 28, 508, 239 28,925,480
30, 589,156
29, 021,912
27,440, 228
Capital stock paid in
1, 593,856 1, 615, 744 1, 616, 476 1, 633, 271
Surplus fund
,
1, 528, 326
1, 419, 695 1,450,499
1,490,146
Undivided profits—net..
538, 744
557,437
549, 624
491,681
Reserves for dividends, contingencies, etc..
67, 271
85,360
58,055
Reserves for interest, taxes, and other
expenses accrued and unpaid
66, 609'
80,700;
83,753
81,464
National-bank notes outstanding
649,095.
648, 548
650,405
647,848
Due to Federal reserve banks..
49, 745
35, 618
Amount due to national banks
885,197
Amount due to other banks, bankers, and
trust companies
1,817, 202 2,843,472
Certified checks outstanding
78,943
4, 073, 551 3,498, 397
307,624
Cashiers' checks outstanding
i
602,326
28, 404
Dividend checks outstanding
Letters of credit and travelers' checks outstanding
12, 389 11, 780, 721 10,934,994
Demand deposits..
11, 003, 795
Time deposits (including postal savings).. 8, 296, 638 11, 073.155 8, 306,938 8,166, 596
United States deposits
272,893
185, 916 8, 310,891
186,170
113, 333 24,347,380 22, 872, 880
Total deposits *
22,639,337
23,005,311
United States Government securities borrowed
17, 877
Bonds and securities, other than United
35,425
18, 545
20,472
States, borrowed
3,358
Agreements to repurchase United States
Government or other securities sold
7,217
53,451
35, 591
75,165
Bills paj^able (including all obligations
representing borrowed money other than
rediscounts)
622,108 I 707,581
785, 309
703,812
Notes and bills rediscounted
179, 077
Acceptances of other banks and foreign
bills of exchange or drafts sold with indorsement
329, 764
247, 867
227, 745
222, 508
Letters of credit and travelers' checks outstanding
17, 934
Acceptances executed for customers.^.
411, 763
524,725
420, 754
473, 509
Acceptances executed by other banks
23, 248
19,173
26,133
20,918
82,416
Liabilities other than those stated above..
58,814
85,123
117,890
1,627, 375
1,479, 052
487, 504
80,832
Total.
3,358
272,096
LIABILITIES
Total.
28, 508, 239 28,925,480
30, 589,156
29, 021,912
73,968-'
649,452
2, 548,482
10, 504, 268
8,317,095
228,243
21,698,088
20,186
49,650
714, 507
164, 866
392, 623
18,648
83,467
27,440,228
* Letters of credit and travelers' checks soldfor cash and outstanding have not been included with total
deposits for calls prior to Oct. 3, 1928.
Banks other than national
A summary of the resources and liabilities of reporting banks other
than national in the continental United States, Alaska, and insular
possessions, on June 29, 1929, as compared with June 30, 1928, is as
follows:
139
SECEETAEY OF THE TEEASUEY
Resources and liabilities of banks other than national on June 29, 1929, compared
with June 30, 1928
[In thousands of dollars]
June 30, 1928 June 29, 1929
Classification
Increase (+)
or decrease
(-)
Number of banks...
^
,
18, 522
• 17, 794
Loans and discounts (including rediscounts)
Overdrafts—
Investments
,
Banking house, furniture, and fixtures..
Other real estate owned
Cash in vault
,
Reserve with Federal reserve banks or other reserve agents...
Other amounts due from banks
Exchanges for clearing house and other cash items
0,ther resources
24, 397, 072
40, 269
11, 624, 366
942, 467
278, 287
572, 732
1, 652, 457
1, 730, 441
789, 766
1,038, 232
26, 575,139
46, 664
10, 692, 203
1,006, 770
271, 977
521, 925
1, 847, 249
1, 713, 338
906, 766
1,150, 246
+2,178,06/'
+6, 395-932,163=
+64, 303;
- 6 , 310^
-50,807'
+194, 792'
-17,103
+117, 000
+112,014
43, 066, 089
44, 732, 277
+1, 666,188
1, 931, 666
2, 725, 834
+237, 937
+406, 812
668, 924
2,169, 603
3,132, 646
609, 882
80, 651
1, 343, Oil
1, 453, 265
+110, 254
449, 614
13, 302, 856
20, 241, 471
36, 900
339, 938
35, 773, 790
764, 961
464, 880
13, 845, 896
20, 470, 522
57, 869
20,121
36,312, 553
916,196
5,863
57, 294
1, 378, 781
' +15,266+543, 040"
+229, 051
+20, 969*
-379, 817
+638, 763
+ 15L 235
-72a
RESOURCES
Total
LIABILITIES
Capital stock paid in
•.
Surplus
Undivided profits—net
Reserves for dividends, contingencies, etc...
Reserves for interest, taxes, and other expenses accrued and
unpaid
Due to banks
Certified, cashiers', and travelers' checks and cash letters of
credit outstanding.
Demand deposits
Time deposits (including postal savings)..
United States deposits
Deposits not classified...
Total deposits
Bills payable and rediscounts
Agreements to repurchase securities sold.
Acceptances executed for customers
Other liabilities
Total
1, 200,914
43, 066,089
44, 732, 277
+90, 417
+241, 024
+1, 666,188
140
REPORT ON T H E FINANCES
AU reporting banks
[National, State (commercial), savings, and private banJis, and loan and trust
companies]
The total number of reporting banks on June 29, 1929, was 25,330
banks, which included 7,536 national banks and 17,794 banks other
than national. A comparison of the resources and liabilities of all
reporting banks on June 30, 1928, and June 29, 1929, follows:
Resources and liabiUties of all reporting banks on June 29, 1929, compared with
June 30, 1928
[In thousands of dollars]
Classification
June 30, 1928 June 29, 1929
Increase (+)
or decirease
(-)
,
26, 213
25,330
Loans and discounts (including rediscounts)....
Overdrafts
Investments
Banking house, furniture, and fixtures
Other real estate owned
Cash in vault
Reserve with Federal reserve banks or other reserve agents...
Other amounts due from banks..
Exchanges for clearing house and other cash items
Other resources
39, 542, 067
50, 407
18, 771, 814
1, 663, 696
403, 967
887, 845
3,105, 840
3, 616, 408
1, 753, 098
1, 779,186
41, 376, 269
56,857
17, 348, 738
1, 754, 454
390, 816
819,928
3,192, 200
3, 567, 525
1, 691, 772
1, 973, 946
+1,834, 202
+6, 450
-1,423,076
+90, 758
-13,151
-67,917
+86, 360
-48,883
- 6 1 , 326
+194, 760
71, 574, 328
72,172, 505
+598,177
3, 525, 522
4,145, 629
3,796,978
4, 611,698
1,097, 386
161, 483
142, 776
649, 452
3, 629,197
+271, 456
+466,169
837, 430
24, 350,164
28, 787, 617
286,112
20,121
67,910,641
1,630, 703
55, 523
449, 917
1, 665, 948
-27,155
+43, 613
+249, 508
+63,296
-379,817
72,172, 505
+598,177
Number of banks
..-.
RESOURCES
Total
LIABILITIES
Capital stock paid in
Surplus
Undivided profits—net
^
Reserves for dividends, contingencies, etc
Reserves for interest, taxes, and other expenses accrued and
unpaid
National-bank circulation..
Due to banks
Certified, cashiers' and travelers' checks and cash letters of
credit outstanding
Demand deposits
Time deposits (including postal savings)
United States deposits
Deposits not classified
Total deposits
Bills payable and rediscounts
Agreements to repurchase securities sold
Acceptances executed for customers
Other liabilities
Total
1, 310,114
649, 095
4,081, 028
864, 585
24, 306, 651
28, 538,109
222,816
399,938
68,413,127
1,566,146
1,964, 795
71, 674,328
+91, 531
+357
-451,831
-602,486
+64, 557
+206, 593
Resources and liabilities of all reporting banks, 1923-1929
[In thousands of dollars!
Classification
1925—28,841
banks
1923—30,178
banks
1924—29,348
banks
1 30,416, 577
57,982
13, 672, 547
5, 597,150
1,432, 217
1,196,075
797,101
865, 262
1 31,427,717 1 33, 883, 733
56,334
50,259
15,400,113
14,228,745
6, 774,392
6,121,093
1, 736. 585
1,590,259
2,181,137
1.992,370
951,286
911, 500
1,079, 532
816, 672 _
1929—25,330
banks
1927—27,061
banks
1928—26,213
banks
1 36, 233,490
49,470
15, 815,141
6,769,061
1, 851, 967
2,037,561
996, 520
1,140,152
37, 270,378
43,450
17,255,093
6,900,402
1,979, 578
2,181,167
1,007, 896
1 1,494,594
39, 542,067
50,407
18, 771,814
6,722, 248
2,067, 663
1,753,098
887,845
1,779,186
41,376, 269
56,857
17,348, 738
6, 759, 725
2,145, 270
1,691, 772
819, 928
1,973,946
1926—28,146
banks
RESOURCES
L o a n s a n d d i s c o u n t s (including r e d i s c o u n t s ) .
Overdrafts...
B o n d s , stocks, a n d other securities
D u e from other b a n k s a n d b a n k e r s 2
Real estate, furniture, etc.3
.'.
Checks a n d other cash i t e m s <
Cash on h a n d
O t h e r resources
.
. ...
Total..
54.034, 911
57,144,690
62,057,037
64,893,362
68,132, 558
71, 574,328
72,172, 505
3,052, 367
2, 799, 494
954,145
720. 001
358,110
40,034,195
238, 439
3, 610, 211
3,114,203
2,967,359
971, 730
729, 686
664,857
42,954,121
152,302
3,928, 292
3,169,711 .
3,173, 334
1,067, 517
648,494
698,861
46, 765,942
147, 220
4,370,909
3, 273, 303
3,471, 968
1,127, 789
651,155
655, 649
48, 882. 296
187, 827
4, 330, 605
3,376,498
3,764, 527
1,201, 532
650, 946
1,119, 943
51,132, 554
194, 024
4, 289, 337
3, 525, 522
4,145, 529
1,310,114
649,095
864, 585
53, 244, 698
222,816
4,081, 028
2, 267,949
1, 662,140
2,015,049
2, 312, 770
2,403,197
3, 530,941
3,796, 978
4, 611, 698
1,401, 645
649, 452
837,430
53,137, 781
286,112
3, 629,197
20,121
3,802,091
54, 034, 911
57,144, 690
62,057,037
64, 893, 362
68,132, 558
71, 574, 328
72,172, 505
LIABILITIES
C a p i t a l stock paid in
S u r p l u s fund
Other u n d i v i d e d profits.
Circulation (national b a n k s ) . .
Certified checks a n d c a s h i e r s ' c h e c k s
I n d i v i d u a l deposits
U n i t e d s t a t e s deposits
D u e to other b a n k s a n d b a n k e r s
Deposits n o t classified
Other liabilities «
Total...
...
._
1 Includes acceptances reported by national banks.
2 Includes lawful reserve with Federal reserve banks..
Includes real estate owned other than banking house.
^ Includes exchanges for clearing house.
«Includes bills payable and rediscount^
CO
o
tel
>
o
M
H
td
>
w
cl
to
142
REPORT ON T H E FINANCES
The following statement shows the number of national banks June
29, 1929, in each State, with the amount of capital and aggregate
assets, in comparison with similar information for all reporting banks:
Number, capitjal, a n d assets of national banks, and all reporting banks, J u n e '29.
• '"• ' •
1929, by States
All b a n k s , i n c l u d i n g national
banks ;
"National banks
States, etc.
].
2.
Z.
4.
5.
6
Maine
New Hampshire
Vermont
Massachusetts
Rhode Island
Connecticut
Number of
banks
53
56
46
155
10
64
. .
:
Total New England S t a t e s . . . . . .
7.
8.
9.
10.
11.
.12.
New York..
NewJersey
Pennsvlvania
Delaware
Maryland
DistrictolColumbia
;13.
14.
15.
.16.
17.
18.
19.
:20.
21.
:22.
'23.
24.
:2o.
Virginia
West Virginia
North Carolina
South Carolina.
Georgia
.
Florida
Alabama
Mississippi...
Louisiana
Texas
Arkansas..
Kentucky..
Tennessee
i
:... :
. ' ..
.
.•.
Total Southern States..
•26.
^7.
28.
29.
30.
31.
32.
33i
Ohio
Indiana
Illinois
Michigan
Wisconsin .
Minnesota
Iowa
Missouri
:
;.
."34.
35.
36.
37.
. 38.
39
-40.
41.
42.
North Dakota
South Dakota
Nebraska
.:
Kansas
Montana
Wyoming
. . .
. .
Colorado
New Mexico
Oklahoma
.:..;
'
•
Total Middle Western States...
_.
Total Western States
43.
44.
45.
46.
47.
• 48
-49.
Washington
Oregon
California
Idaho
Utah
Nevada
Arizona
Total Pacific States
'
..
Number of
banks
$156,041
85,779
80, 679
1, 540, 028
60, 589
335,203
134
123
, 104
452
33
254
Capital
(000
omitted)
Aggregate
assets (000
omitted)
$13,876
6,630
8,086
143, 678
14, 390
48,033
$473, 228
334, 643
286, 399
• 4, 791, 518
584,406
, 1,495,478
384
130, 390
2, 258, 319
1,100
234, 693
,.7,965,672
354, 745
' ^ 55; 501
162,448
1, 029
14,359
10, 775
6,119,144
• 1; 051, 946
. 3, 225, 910
26,429
287,458
173,822
1,141
567
1,589
51
„ 235
41
870, 020
14;l, 374
378, 267'
10,800
40, 663
24,880
•20,804, 553
•' 2,865, 632
• 6, 905, 979
189, 755
993,191
331, 797
599,457
164
116
73
53
80
55
106
35
33
623
73
138
99
'
$7, 220
5, 500
5,260
85, 388
4,520
22, 502
Aggregate
assets (000
omitted)
562
299
861
17
82
12
1,833
Total Eastern States
Capital
(000
omitted)
10,884, 709
3,624
1,466, 004
32, 090, 907
29,643
385,123
13,835
208,125
14,865
192, 351
125, 662
9,550
270, 342
18,405
229, 200
15,190
. ;244, 985
18, 020
' - 5,425 • • ! 94,560
137,161
9,750
1,103, 501
•
84,185
98, 670
6,915
299, 464
19,021
300, 308
20, 964
484
310
428
223
.424
257
350
334
' 226
1,353
420
572
490
59, 316
33, 552
37, 335
18, 927
40,479
31,132
30,131
16,473
34, 218
121, 216
21, 719
49, 775
44,099
667, 612
440, 223
495, 243
225, 578
454, 386
418,127
j 377,962
! 277,294
558, 655
1,445,406
269, 338
685, 024
577, 612
3, 689,452
5,871
538, 372
' 6,892,460
1,648
265, 768
.323
224
487
133
157
272
• 265
134
58,800
32,9.33
•94,1«5
31,890
32,275
37,-525
23,080
38,010
1,995,
348, 698
5,818,084
125
93
158
247
69
25
121
28
307
5,390
4,415
14,225
17,847
. 5,305
2,270
12,650
2,060
26,015
87,696
81,003
255,246
272,736
102, 739
42,776
271,526
37,281
444,423
1,173
90,177
106
93
211
43
20
10
14
23, 590
13,145
145,445
2,730
3,650
1,500
1,950
' 497
192,010
1,029
901,394
9.86
469,671
1,801
1,605,598
781
663, 786
964
536,056
671,332
1,072
. 365,989. ' 1,328
604,258.
1,325
,
191,153
1 3i, 314,080
78,417
,1,234,844
333, 507 • '4,922,404
129, 774
2,605,015
69, 676
1 1,147,485
61,488
1,127,571
: 1,014, 508
67,258
• 1,487,106
108,247
1,039,520
16, 753, C13
433
396 .
846
' 1,077
198
87
. 278
. 58
.649
11,137
11,047
•32,316
40,950
li,365
4,285
18,123
3,240
33,412
147,251
177,214
510,585
538,683
180,486
74,693
346,309
51,257
543,021
1,595,426
4,022
166,475
' 2,579,499
350, 526
^238,271
2,422,089
47,030
61,817
22,989
36, 512
344
235
455
137
105
35
46
36, 532
21,061
234,134
5,912
11,921
3,437
6,026
570,442
327,948
4,169,954
100,421
194,441
53,730
107,315
3,179,234
1,357
319, 023
5, 524,251
9,286
,
143
SECBBTARY OP THE TEEASURY
Number, capital, and assets of national banks, and all reporting banks, June 29,
1929, by States—Continued
All banks, including national
banks
National.banks
States, etc.
50.
51.
52.
53,
Alaska
The Territory of Hawaii
Porto Rico
Philippines
Number of
banks.
. ..
Total possessions
Total United States and possessions ...-
4
2
Capital
(000
omitted)
Aggregate
•assets (000
omitted)
Number of
banks
$275
600
$5,313
9,691
17
23
18
12
$915
10,284
8,453
13,239
$14,776
122,686
75,328
153,913
875
15,004
70
32,891
366,703
1,627,375 27,440,228
25,330
3,796,978
72,172, 505
.
6
7,536
Capital
. (000
omitted)
Aggregate
assets (000
omitted)
CUSTOMS SERVICE
Receipts
Under the tariff act of 1922 the customs receipts for the fiscal year
1927 reached the sum of $605,672,465, the largest collected in the
history of the Government, Receipts for the year just closed were
lower than those of the record year of 1927 by only $2,852,309. The
total amount collected and covered into the Treasury under the head
of customs receipts, which includes duties and tonnage tax, was
$602,820,156. This is $34,663,563 more than the receipts for the
fiscal year 1928.
The total miscellaneous receipts were lower than for the fiscal year
1928 by $165,883. The reduction is due to a decrease of $66,523 in
the proceeds from the sale of seizures and of $132,121 in the fines
collected. This decrease is partly offset by an increase of $22,211
in the proceeds from the sale of abandoned merchandise and of
$14,942 in the receipts from customs fees, sale of surplus Government
property, storage on general order goods held in Federal buildings,
etc. The falling off in the proceeds from the sale of seizures is due
to the increased number of forfeited automobiles and boats taken
for official purposes under the provisions of the act of March 3, 1925.
This results in the withdrawal of the best machines and boats from
sale.
The comparative statement below shows in detail all collections,
refunds, and net receipts from all sources for the fiscal years 1928
and 1929:
1928
Collections:
Duties
MiscellaneousSale of unclaimed merchandise
Sale of abandoned goods,
Sale of seizures
'....1
Customs fees, etc
Fines
$568,156, 593
$7,281
6,807
213.349
74, 030
2. 259, 254
Total
Refunds:
Refunds of excessive duties
Dra w back pa y men ts
Net customs receipts from all sources
1929
•
2, 560, 721
$602, 820,156
$2.889
29, 018
146,826
88, 972
2,127,133
570,717,314
7, 617, 307
14, 327, 953
21, 945. 200
548, 772, 054
2, 394, 8S8
605, 214, 994
8, 2S4, 205
13,244,700
21, 528, 965
583, 686, 029
The proceeds frora the sale of unclaim^ed and abandoned merchandise and seizures do not represent the total amount received
from such sales and deposited in the Treasury, since the amount of
144
145
SECRETARY OF THE TREASURY
duties accruing on such merchandise is deducted and deposited as
duties. The amounts in the foregoing table, therefore, show only
the balances remaining from the proceeds of sale after deduction of
duties and expenses connected with the sale.
Volume of business
During the fiscal year ended June 30, 1929, the Customs Service
received 3,175,144 entries of all classes, entered and cleared 213,554
vessels, inspected 11,736,008 automobiles and other vehicles and
attended to the customs formahties in connection with the entry
of 46,862,384 passengers who arrived by vessel, railroad, and highway. The business showed an increase over the previous year in
every'branch.
Entries.—The comparative statement below of entries of all classes
for the fiscal years 1928 and 1929 shows a total increase of 95,412
entries over the previous year:
Number of entries, fiscal
year—
Class of entries
1928
Consumption:
Free
Dutiable..
Informal
Mail.
Baggage
Warehouse and rewarehouse
Immediate transportation without appraisement.
Transportation and'exportation.
'....,......Warehouse withdrawals, duty paid
. Warehouse withdrawals, all other
All other entries
Drawback notices of intent
Drawback entries
246,577
495,695
214,777
825,925
400,894
66,048
143,757
115,270251,758
36, 572
13, 752
241,757
26,950
Total entries
3,079,732
1929
264,194
501, 705
214,503
838, 228
397,823
65,773 •
146; 714
124,064
264,593
37,660
24,200
265,888
29,799
3,175,144
The steady increase in the volume of customs transactions from
year to year is indicated in,the following summary of the total number
of entries of all classes, by fiscal years, for the past five years:
Fiscal year
Number of
entries
1925
1926
1927
2,658,746
2,861,513
3,000,859
Fiscal year
1928
1929
Number of
entries
3,079,732
3,175,144
Vessels.—During the fiscal year 1929 there were entered from
foreign ports 32,566 more vessels than during the preceding year and
6,181 more from domestic ports. The number of vessels cleared for
foreign ports during the year exceeds that for the fiscal year 1928 by
1,498 and the number cleared for domestic ports by 5,600. The
71799—30—FI 19 2 9 - ^ - 1 2
146
REPORT ON T H E FINANCES
detail of the number of vessels entered and cleared for the fiscal
years 1928 and 1929 is shown in the statement below:
1928
Number of ^vessels- entered:
From foreign ports—
In ballast
Bulk cargo.
General-cargo.
From domestic ports...
Number of vessels cleared:
For foreign ports
...
For domestic ports
1929
17,765
13,387
18,059
34, 272.
39, 053
16,293
26,431
40,453
48,406
35,820
49,904
41,420
Highway :trafic.—The. volume of international highway traffic is
indicated in the comparative statement below, showing by customs
districts the number of automobiles and other vehicles, entering
the United States during the fiscal years 1928 and 1929:
N u m b e r of a u t o m o b i l e
entries, fiscal year—
N u m b e r of a u t o m o b i l e
entries, fiscal year—
C u s t o m s district
C u s t o m s district
1928
A laska
Arizona
Buffalo
Dakota.
Duluth
El Paso.-.
Los Angeles
Michigan
12,000
1,452,640
1, 966, 542
62, 401
69,402
792,915
3,145,080
••• 1,087,001
877, 395
1929
Montana
16.925
1,229,811 j O h i o .
Rochester
2, 387,998
117, 626
St. L a w r e n c e
86, 230
San A n t o n i o
946,802 • Viermont
2, 536, 722 W a s h i n g t o n
1,256,-436
Total
1, 076,146
1928
.
•1929
20,538
1,072
490
217,775
798,461
399,826
209,758
64,964
3,310
470
328,013
985,859
460, 697
, ,•237^999
11,113,296
11,736,008
The number of automobiles and other vehicles entered during the
fiscal year 1929 exceeded that for the previous fiscal year by 622,712.
The number of passengers arriving in the United States by automobile
during the year just closed was 33,426,557. Comparative figures of
the number of passengers arriving in the United States by vehicle are
not available for the fiscal year 1928.
The steady increase in highway traffic demands the very best
facilities for the inspection of such traffic and the location of inspection stations at the most strategic points in order to protect the
Government's interests with the least interference with the prompt
movement of traffic. Appropriations are now available for the construction of 28 highway inspectioh stations for the joint use of the
Customs and Immigration Services. Twenty-two of the sites for
such stations have been selected and plans are in preparation, standardized in so far as possible, for the several classes of stations required.
Indication are that actual construction work will begin by next spring.
Passengers.—In addition to the 33,426,557 passengers which arrived
in the United States by highway, 11,304,077 passengers arrived by
vessel and 2,131,750 by railroad.
147
SECRETARY OF THE TREASURY
Seizures,—The table below shows the number of seizures made for
-violation of the customs laws and the appraised values of such seizures
for the fiscal years 1928 and 1929, classified by groups of commodities:
, 1928
Class of commodities
Appraised
value
$8,909.91
38,334.41
398.040. 84
4, 283. 50
43, 789. 48
1, 543. 36
745, 094. 84
719, 407. 51
Beads and beaded articles
Furs
...
Jewelry and precious stones
Laces and embroideries . .
Livestock, farm, dairy, and meat products .
Perfumery and toilet articles
Silk, linen, woolen, and cotton goods
All other, except as detailed below
., .1929
Number of
seizures
Appraised
value
(
$1,149.96
36,163. 77
623, 257. 27
671,904. 33
6,705
11,033.11 I
17, 621. 02
198, 233. 73
. 2,336,455.44
1,959,403. 85
Vehicles, etc., used in transporting liquors: i
Boats
.
A utomobiles
• Horses and mules
. ..
Horse-drawn vehicles
1,129,039. 00
602,449. 92
14,570. 50
1,204.17
1,747,263.59
Liquors'
Alcohol'
N arco tics
Total
Number of
seizures
9,891
3, 895,818. 63
f
21,.166
278,348. 80
363,549. 62
160
4, 348, 565. 86
28,031
426,755.91
570, 098. 72
6,039.00
4, 722. 67
1,007,616.30
I
24,368
(2)
208,490. 60
482,781.53
5, 594, 707. 06
13
34,395
' The number of vehicles, etc., used in transporting liquors seized and the gallons of liquors and alcohol
seized are as follows:
1928
Boats
Automobiles.
Horses and mules
Horse-drawn vehicles
..
.1929
Number Number
761
671
2,162
2,235
317
183
17
38
1928
Liquors
Alcohol
-.
1929
Gallons Gallons
630,769 543,158
78,559 59,477H
* No appraised value reported, as commodity is a. prohibited importation and has no sale value.
The appraised value of laces and embroideries seized shows an
increase from $4,283 for the fiscalyear 1928 to $671,904 for the fiscal
year 1929. This decided increase is due to the discovery of fraud in
connection with certain laces and embroideries from Italy entered
in 1923 and 1924, making subject to seizure these goods appraised
at a value of $669,836. While 73 more automobiles were seized
during the fiscal year 1929 than during the preceding year, the
appraised value of such automobiles decreased by $32,351. The
appraised value of narcotics increased by $119,232. This increase
is due to seizures of unusually large quantities made at Seattle, New
York, and San Francisco.
Expenditures and other statistics.—Other statistics, indicating the
volume of customs transactions in the several districts, values of
imports and exports, the cost of collection, collections made, etc., are
published in Table 15, page 434, of this report. While expenditures
148
REPORT ON" THE FINANCES
due to increases in salaries under the sev^eral acts, of Congress for the
classification of the field service increased by a million and a half
dollars, the cost to collect one dollar increased by only $0.0034, this
cost for the fiscal year 1928..being $0.0308.and for the fiscal year 1929
$0.0342.
Outstanding accounts
During the fiscal year 1929 the system inaugurated by the bureau
during the preceding year was extended and resulted in the collection
of approximately 300 old accounts. The following tabulation indicates the amount of such accounts collected during the fiscal year 1929:
Amount
collected
Item
Duties
Fines.
Interest
Court costs..
Liquidated damages
.
1
.-
Total
-
-
$21,174.33
3,884. 23
59. 25
51.11
5.00
25,173.92
The various collectors of customs were also assisted in adjusting
properly many .old accounts which had been outstanding on their
records for long periods of time. This effected a saving of considerable labor on the part of the clerical forces in both the offices of the
collectors and the comptrollers of customs in reporting and checking
these items quarterly year after year.
The bureau has further succeeded in securing action by the United
States attorneys on many cases that had been dormant for some
time. Approximately 30 such cases have progressed to the point
where they are now awaiting trial. Among them is a test case
covering tile entries the outcome of which will determine the Government's right to collect over $66,000 in duties. This particular
case will, according to the United States attorney, be heard at the
next session of civil court at Miami, Fla.
The bureau has also been instrumental in securing several substantial offers in compromise in cases where there was grave doubt
as to whether the Government would prevail in a court action. In
other instances collection has been effected in cases which had been
pending six or seven years and which were recommended by the
United States attorneys for dismissal without further action.
Appraisers* stores
The examination and appraisement of merchandise is a function
of prime importance in the assessment of duties. I t is essential,
therefore, that the very best facilities be provided in order that the
customs revenue may be properly protected. The new appraiser's
SEORETARY OF THE TREASURY
149
stores at New York, which was completed and occupied during the
year, therefore deserves some description.
This building covers an area of 200 by 400 feet, is 12 stories in
height, contains over 1,000,000 square feet in floor space, approximately 80 per cent of which is devoted to the appraisement and
classification of imported merchandise. Eight freight elevators,
each 12 feet by 18 feet, are installed, and provision is made for the
future installation of additional elevators as necessity may require.
A loading platform is provided on the first floor, under cover, of
suflScient capacity to accommodate 56 motor trucks. The building
is equipped with electric Telfer hoists, capable of lifting cases weighing 3 toris each from trucks and depositing them upon the elevators
for delivery to the various floors. Electric trucks, with skids, for the
purpose of carrying cases from trucks to elevators and from the
elevators to the examination spaces, greatly simplify and expedite
the receipt and delivery of merchandise. For the prompt delivery
of small cases, a package chute is provided on each floor, which
•delivers cases and other packages to the first floor of the building
with perfect safety in a few seconds. Pneumatic tubes from the first
to all the other floors expedite the receipt and transfer of delivery
tickets, and a larger pneumatic tube is connected directly with the
<iustomhouse, 3 miles away, by which invoices are received from and
delivered to the collector of customs in three minutes. Completely
•equipped chemical and analytical laboratories have been installed, in
which approximately 50,000 analyses per annum can be made.
The moving of this vast equipment from the old to the new building
was accomplished with a loss of time of officers and employees of only
one-half a day. Detailed plans and charts of the location of each
division and activity in the new building were made, pneumatic
tubes and telephones were installed, so that the building was ready
for the transaction of business without interruption as soon as occupied. The moving commenced on February 22, a legal holiday, and
was completed the next day, Saturday, a half holiday, so that only a
half day was lost in working time. The appraiser's stores functioned
completely in the new building the following Monday morning.
Such modern buildings and facilities, but less extensive as to capacity, are urgently needed at Philadelphia, Baltimore, Chicago, and Los
Angeles, where the facilities for proper examination and appraisement
of merchandise are now very inadequate.
Extension of port limits
A car ferry was placed in operation between Habana, Cuba, and
New Orleans, La., with a capacity of 95 loaded freight cars. The cars
are load,ed on the ferry by means of specially built loading cranes,
which are located at Belle Chasse, some distance from New Orleans.
150
REPORT ON THE FINANCES
The limits of the port of New Orleans were extended to include this
point so that proper customs supervision could be given to this new
activity. I t is expected that the operation of the ferry will make
possible the development of trade in commodities which can not be
handled profitably by ordinary transportation methods.
The increase in business and the numerous demands for the services of customs .oflicers outside the port limits of Boston made d e sirable the extension of the port limits. The limits of the port of
Boston were accordingly extended to include Braintree, Weymouth^.
Hingham and adjacent waters.
Commercial trans-Atlantic travel by air
On October 15, 1928, customs officers from the port of Philadelphia
made entry at Lakehurst, N. J., of the German dirigible Graf Zeppelin,.
which arrived at the naval air station on that date. The ship carried
a crew of 40, 20 passengers, 52 packages of merchandise, and 15 sacks
of mail. The dirigible was cleared on October 16, 1928, carrying passengers and four packages of merchandise. Its outward manifest
shows 25,000 cubic millimeters of fuel gas and 12 tons of gasoline.
Drawback
A constantly growing number of American manufacturers are taking advantage of the provisions under section 313, Title I I I , of the
tariff act of 1922 for the allowance of drawback enabling them to
compete successfully in foreign markets which would otherwise be
closed to their products. As a result, there has never been a time in
the history of drawback when such a wide range of manufactures and ,
productions has been represented by claims as during this year.
Existing drawback rates cover practically every industry, involving
processes of manufacture from the most simple to the most complex.
The reinvestigation of all drawback rates heretofore established is
now under way and has brought to light several instances of failure
to comply with the regulations. Corrective measures to prevent
recurrences are being taken.
Undervaluations
During the j^ear recoveries were made in a number of undervaluation cases, principally by compromise. Some of the more important
include $311,125 obtained from various concerns for undervaluation
of carpets and floor coverings; $74,887 recovered in connection with
the undervaluation of importations of church regaha, embroideries,
and manufactured wool cloth; $25,000 for undervaluations of fur
skins from China; $75,000 for failure to declare repairs to vessels
made in foreign countries in violation of section 466 of the tariff act
of 1922; $20,000 for the illegal importation of certain diamonds
151
SECRET-IRY OF T H E TREASURY
during the years 1925, 1927, and 1928; and $62,000 in connection
with the seizure of unmanifested jewelry.
Patrol activities
The customs patrol was considerably expanded during the year,
both in number of officers and equipment used. The average number
of automobiles operated by the patrols shows an increase of 331 and
the number of boats an increase of 79, with an increase of 3,166,212
and 338,899 nnles traveled, respectively. The cost per mile for operation was reduced from $0,042 for automobiles in the fiscal year 1928
to $0,037 for the fiscal year 1929 and for boats from $0,345 to $0,278.
The total average cost of maintenance and operation per automobile
was reduced by $100 and per boat by $136.
During the fiscal year 1929 the patrols made 1,979 more seizures
through the use of automobiles and 583 more by the operation of
boats than during the preceding.fiscal year. The appraised values of
all seizures, exclusive of liquor, and fines imposed increased by
$723,563 over the previous fiscal year.
The table below shows in detail the maintenance and operation
of automobiles and boats in the customs patrols and the results
accomplished by such operation for the fiscal years 1928 and 1929:
Fiscal year1928
Average number operated:
Automobiles
Boats
Mileage covered:
Automobiles
Boats
Average cost per mile for operation and maintenance:
Automobiles
B oats... 1 . . . . - ---Average cost for maintenance and operation:
Per automobile..!
"
Per boat
Results accomplished:
Seizures made by use of automobilesTotal number of seizures..
Number of gallons of liquor...
Number of gallons of alcohol
Appraised value of alcohol.
Number of automobiles
Appraised value
Number of boats
Appraised value
Appraised value all other seizures
Penalties and fines imposed
Seizures made by use of b o a t s Total number of seizures..
Number of gallons of liquor
Number of gallons of alcohol..
Appraised value of alcohol
•
Number of automobiles
Appraised value
Number of boats
Appraised value. _
r
^
Appraised value of all other seizures
Penalties and fines imposed
._
Total penalties imposed and appraised value of all seizures except liquors
By use of automobiles
By use of b o a t s . . .
•.
Total for automobiles and boats
156
26
1929
487
105
1, 736, 251
97, 576
4,902, 46a
436, 475
$0. 042
$0. 345
$0. 037
$0. 278
$473
$1, 295
• $373$1,159
882
48, 930
312
$3,129
298
$119,455
70
$122,144
$16, 082
$10, 989
2,861
224,451
442
$4,424
1,170
$346, 519
253
$100, 561
$35,001
$24,010
380
30, 273
116
$1,167
. 3
$1,400
23
$8,105
$387
$2, 609
943
182, 604
519
$5,190
32
$1, 850
110
$56, 692
$416,262
$18, 520
$271,800
13, 669
$510, 517
498, 515
1,009,032
285,469
152
REPORT ON T H E FINANCES
Activities of the customs agency service
During the year the designation. of the investigative branch was
changed from the special agency to the customs agency service in
order, to give it a distinctive title that would not be confused with
special agents in other branches of the Government service. The
service, in the discharge of its statutory and delegated functions,
continued to make periodic examinations of the accounts and records
of the collectors and other officers of customs for the information of
the administrative officials in Washington. As the result of the
reports of the agents engaged in this class of work, the department
was able more effectively to supervise and harmonize the functioning of the Customs Service.
A number of the customs agents are engaged in the prevention of
fraud arising from the undervaluation of merchandise. This class
of fraud usually originates abroad in connection with the preparation
of consular invoices used in the entry of the merchandise upon its
arrival in the United States. This means of fraud has been utilized
by many unscrupulous importers who are thus placed in a position
to undersell honest importers and drive them out of business. It is
therefore of paramount importance for the Government to exert
every effort to safeguard the revenue from loss on account of undervaluation and at the same time to protect honest merchants in the
conduct of legitimate businesses. In this connection invaluable
services are rendered by the customs attaches abroad in preventing
this class of fraud at its source and in developing facts which are of
material assistance in undervaluation cases. In many instances
their reports have been most helpful in the conduct of reappraisement hearings before the United States Customs Court. During
the year, in one district alone, fraud and irregularities on the part of
52 importers and 53 foreign shippers were discovered in connection
with the undervaluation of merchandise which resulted in the submission of nearly $500,000 in compromise.
During the fiscal year 1928 a unit of especially skilled investigators was formed to minimize the smuggling of diamonds and
other precious stones. This unit rendered markedly valuable service during the fiscal year 1929. It made 166 seizures resultuig in
the collection of fines and penalties in the amount of $635,246 and
the forfeiture of merchandise valued at $158,905. Twenty persons
were arrested and of the 15 that have stood trial, 13 have been
convicted. It is believed that these criminal prosecutions will prove
a greater deterrent to smuggling than the exaction of monetary
penalties only, however severe.
The smuggling of liquor and other contraband has also had the constant attention of the agents. While the number of arrests by agents
in the above connection have fallen off somewhat from those of the
SECRETARY OF THE TREASURY
153
previous year, it is not an indication of lesser activity. This apparent
inconsistency is explained by the fact that much valuable information regarding contemplated violations of the customs, prohibition,
immigration, and other laws has been transmitted to the collectors'
forces and to other proper governmental agencies which make the
actual seizures and arrests. However, practically all of the investigative work in cases against violators of the tariff act is performed by
customs agents, and the United States attorneys have found their
specialized knowledge in tariff matters and legal procedure of great
value in the successful prosecution of suits.
The Customs Information Exchange continued to function as the
clearing house for information respecting market values and classifications for the entire Customs Service. In this capacity the following work was done:
Number
NuEQber
Number
Number
Number
of
of
of
of
of
appraisers' reports qf, value received
appraisement appeal reports received
advanced value reports received
changes in value circulated
requests for investigations abroad
:
15, 494,
6, 624=^
7, 482
4, 379
.. 1, 121
In addition to the documents indicated in the above table, the
Customs Information Exchange prepares and distributes index cards
containing Treasury decisions which are sent out weekly and similar
cards covering drawback decisions monthly. There is likewise disseminated weekly a circular giving the sailing dates of vessels from
foreign ports for America and the dates they are due to arrive at
various ports in the. United States for the use of appraising and other
officers throughout the Customs Service.
There was an increase in the number of drawback investigations
made for the purpose of establishing regulations providing the rate
of drawback on articles of commerce manufactured wholly or in part
of imported materials. This work requires the ascertainment of the
different processes connected with the manufacture, and the amount
of imported duty paid on merchandise appearing in the manufactured
article, together with other essential details. The importance of this
work and the necessity for the services of men of integrity and ability
to carry on the same will be appreciated when it is realized that total
drawback payments, predicated upon the customs agents' reports
made at all ports in the United States duruig the year, exceeded
$13,000,000.
I t is impossible to gage the effectiveness of this important arm of
the Customs Service solely by the tangible results accomplished in the
way of arrests, seizures, and cash recoveries, as its primary function
is the prevention of frauds against the customs revenue. The efficiency and vigilance of the agents not only make fraud difficult
but deter unscrupulous persons from engaging in the practice.ffjFor
154
REPORT ON THE FIN.ANCES
these reasons no precise estimate can be made as to the saving to the
Government through this protection afforded the revenue.
The following tabular statement shows the results during the past
year of the customs agency activities so far as direct results can be
measured in dollars and cents or by count of individual cases:
Number of ports examined
166
Number of drawback investigations
1, 594
Number of foreign investigations
:
.
1, 648
Number of arrests
__^ ,
_i_
'
843
Number of convictions
335
Number of acquittals
49
Failures .to indict
'.
64
Indictment cases pending
266
Number of seizures made
1, 243
Number of seizures appraised
----1, 185
Number of seizures released or pending
27
Appraised value of seized merchandise
$1, 776, 254. 55
Proceeds of sale of seized merchandise
:
807, 553. 17
Merchandise entered free but found dutiable
20, 428. 33
Fines, penalties, and forfeitures incurred, exclusive of court fines__
805, 549. 90
Fines imposed by United States courts_.
102, 155. 00
Bail forfeiture
70,737, 54
Amount of increased additional duties collected
214, 443. 72
Amount deposited in offers of compromise
612, 293. 04
It will be noted from the above statement that the actual recoveries and penalties assessed as the result of customs agency
activities during the past fiscal year aggregated $2,633,158. Taking
into consideration the fact that the total cost of operating the customs agency service in this country and abroad during the same
period amounted to less than $900,000, it will be readily seen that
the service was more than self-supporting. In this connection it
may be added that a relatively small force of agents was engaged
on work which directly resulted in the above recoveries. A larger
number were engaged on what may be termed preventive work, the
results of which can not be figured on a monetary basis. An appreciable portion of the time of customs agents was devoted to investigating derelictions detected and reported by the customs personnel throughout the country and to assisting collectors of customs
in organizing the recently created customs border patrol by examning closely prospective candidates for appointment.
DISBURSING CLERK
The following is a summary of the work performed by the .office
of the disbursing clerk during the fiscal year 1929:
Number
Disbursements:
Checks (salaries, expenses, supplies, etc.)
Cash (salaries)
Checks (refunding taxes illegally collected)
Total
Collections on account of rents, sales, etc
Vouchers paid
:
Schedules of claims for tax refunds
..Appropriations under which disbursements were made
Amount
300,570
180,192
131,442
$44,157,637.49
16, 316,005. 95
187,642,930. 76
612, 204
248,116,574. 20
4,111
249,893
7,916
525
1, 558,467.60
The cash payments and the checks for salaries, expenses, supplies, etc., cover disbursements for all bureaus and divisions of the
Treasury Department in the District of Columbia (except the Bureau
of Engraving and Printing), and a large portion of the salaries aind
•expenses outside the District of Columbia under the Public Health
Service, the Supervising Architect's Office, the Bureau of Internal
Revenue, the Bureau of Prohibition, the Federal Farm Loan Board,
the Comptroller of the Currency, the Coast Guard, the Secret Service,
the Bureau of Customs, and the Public Debt Service.
Collections represent moneys received and accounted for on
account of rents of buildings and sites, sales of public property, etc.,
Mnder various bureaus and offices of t h e department.
155
BUREAU OF ENGRAVING AND PRINTING
Except during the period of the World War, the production program of the Bureau of Engraving and Printing, for the fiscal year
1929,. has never been equaled, In addition to the large printing
program, the transition in the manufacture of paper currency from
the old to the new size occurred. This change was attended by the
alteration of old and by the development and construction of new
mechanical devices: Through untiring efforts and hearty cooperation
on the part of the entire personnel of the plant, the program, as
required by the department, was fully accomplished by the end of
the fiscal year.
Deliveries of all classes of work (currency expressed in four subject-size) during the year amounted to 529,742,699 sheets, as compared with 483,455,932 sheets for the previous year, an increase of
46,286,767 sheets, or 9.57 per cent. This increase represented an increase of 46,755,064 sheets of currency, revenue and customs stamps^
and miscellaneous work, and a decrease of 468,297 sheets of bonds^
notes, and certificates.
The average number of persons employed during the year was
4,920, as compared with 4,979 during the previous fiscal year, a
decrease of 59 persons, or 1.18 per cent. Included in this figure are
approximately 600 employees, who were employed temporarily
duiing the last few months of the year to assist in accomplishing the
small-note program. The services of these temporary employees
were discontinued on July 6, 1929.
There was expended during the year a total of $10,603,971.77, as
compared with $9,734,996.41 in 1928, an increase of $868,975.36, or
8.93 per cent. A considerable amount of this increase can be
attributed to overtime, which was necessary to complete the currency progam. I t is interesting to note that, although the number
of sheets delivered increased 9.57 per cent and expenditures advanced
8.93 per cent, the average personnel employed during the year decreased 1.18 per cent.
The first impression of the new currency was printed on August
6, 1928. As soon as new plates became available for printing they
were immediately sent to press and plates of the old size were
dropped. The printings of backs and of faces of the old size ceased
on November 1 and December 15, respectively.
The printed impressions of new-size notes were stored in the vaults
for seasoning and held until all of the old-size currency had been
166
SECRETARY OF THE TREASURY
157
completed and delivered. In the meantime, the new numbering, sealing, and separating machines, referred to in last year's report, were
installed and placed in operation. As the quantity of old-size notes
which passed through this operation decreased, the quantity of
new-size notes was gradually increased. Consequently,-the operation of numbering and sealing shifted from the old size to the new
size without interruption.
The change in the numbering and sealing operation was one
of the most difficult problems. Forty-one machines were required
to number, seal, and separate the old-size notes from sheets of 4
notes each, whereas 17 machines now perform the same amount of
work, numbering, sealing, and separating the new-size notes from
sheets of 12 notes each. The new machines were designed and built
especially for this work.
There were other changes in machinery. The trimming machines
in the examining division were rebuilt to accommodate a 12-subject
sheet instead of a 4-subject sheet. These machines were reconstructed
a t a cost of $21,080. The change from one size to the other was
accomplished gradually and in a manner similar to the change in the
numbering, sealing, and separating operation.
The matter of adjusting personnel required constant attention.
D u e to the fact that most.of the new notes could not be numbered
and sealed until during the last three months of the year, it was
necessary to engage a large personnel during that period. Two
shifts were operating in the numbering division from early in March
until June 30, as a result of which its regular force was increased
from 400 to more than 1,000 employees. Experienced operatives
from other divisions were transferred to the numbering division and
vacancies created by these transfers were filled by the employment
of temporary workers.
Iinmediately after the announcement of the department on January
12, 1929, of the inclusion of national-bank notes in the small-note
program the work of designing and engraving was undertaken. The
portrait on the new national-bank note has been placed in the center
of the note instead of on the left side. The name of the bank is no
longer engraved on the plate, but is typographically printed on the
sheet. This change will be of material assistance to this bureau in
meeting the requirements of the numerous national banks for this
form of currency. Under the old plan there was an engraved plate
for every national bank. When orders were received it was necessary
t o withdraw plates and print the number of sheets required. Under
the present scheme stocks of backs and faces are printed and stored
away. When an order is received Q, sufficient quantit}^ of stock is
withdrawn, the name of the bank and signatures are overprinted,
and the order fulfilled. This materially reduces the length of time
158^
REPORT ON THE FINANCES
required to complete an order, decreases the stock of engraved piatesv
and permits the plate printing of faces, 12 notes to the sheet.
The use of logotypes was introduced for the overprinting of titles,
signatures, and charter numbers. . Logotypes are similar in construe-.
tion to electrotypes, but the metal used in their manufacture is very
much harder, giving them longer life and producing a sharper
impression.
Plate production on national-bank currency was commenced before
the close of the year. A number of plates were sent to press during
May and a few complete deliveries of notes were made in June, but
the great bulk of the initial issue of this class of currency will be
accomplished during the fiscal year 1930.
Due to the fact that it was not possible to reach capacit}'' production in the plant on small-size notes until the latter half of the fiscal
year, it was necessary to institute a rotating furlough during the
first half. The furlough schedules were worked out for employees in
practically every operating division, the number of days to be taken
depending upon the quantity of work performed in each division.
The furlough terminated on February 1. I t was relieved to some
extent, in so far as female employees were concerned, b}^ the transfer
to the Division of Loans and Currency of approximately 200 operatives who were needed for the purpose of redeeming Liberty bonds.
During the earh^ part of the year when the bureau reached capacity
production these employees returned to their posts.
Among the mechanical improvements during the year were the
installation of a vacuum system in the numbering division in order
that the noise of the vacuum pumps on each of the presses might be
eliminated, thereby adding materially to the comfort of the employees
engaged in that division; the installation of tear gas on armored
trucks as an added protection to securities in transit; the inclosing
with glass of the Fourteenth Street entrance to the bureau for the
purpose of protecting from the weather delicate electrical machinery
installed beneath it, as well as for the protection and comfort of
emplo3^ees and visitors during the winter months; the installation of
an automatic folding, pasting, and separating machine for the purposf .
of simplifying the,operation of making paper straps used as money
bands—this work formerly required the services of 15 employees
working full time, but now is performed b}'^ one operator working only
on a part-time basis; and the installation of precanceling devices on
all rotary presses so that orders received from the Post Office Department may be assigned to any press, thereb}^ avoiding delay in ^
fulfilling them and avoiding congestion.
Last year reference was made to the purchase of equipment to be
installed in a new substation. The work of changing the present
25-cycle equipment to 60-cycle has been progressing during the 3^ear,
. SECRETARY OF T H E TREASURY
159
Most of the material necessary to make this change has been delivered
and a considerable amount of the labor required to make the installation has been completed, but it will require another year or more to
finish it.
Although spoilage increased during the past year it is gratifying
to note that despite a great number of experiments with new type of
distinctive paper, as well as new mechanical devices, the increase
was not abnormal. The spoilage for the year amounted to 2.68 per
cent, as compared with 2.02 per cent for the year previous. The
following is a statement of the percentage of spoilage since 1918:
Per cent
1918-_1919
1920__-_J__-__
1921
1922
1923
_-
__- 4.63
6. 48
5. 44
7.39
6. 63
7. 11
Per cent
1924
1925
1926.
1927
1928-_
1929
._:
12.
5.
3.
_' 2.
2.
2.
69
80
70
11
02
68
Shortly after the bureau was in full production on the siAall-size
currency program, it was found possible to use a smaller sheet of distinctive paper. This reduction in size from 13% by 17)^ inches to
13K by 16% inches will save approximately $56,200 a year for the
Public Debt Service, based on the current year's program.
An important change in the organization of the bureau was effected
on January 1, 1929. The buildings and grounds division, which is
charged with the responsibility of cleaning the building and maintaining the grounds, and the watch division, which was charged with
the responsibility of protecting the building, were consolidated. The
new division is known as the buildings and grounds division.
An exhibit has been placed on display at the Ibero-American
Exposition in Seville, Spain. An experienced plate printer was
assigned as representative. A plate-printing power press and picture
frames of currency which constitute the exhibit were shipped about
December 1, 1928. The exhibit opened during March, 1929, and will
continue until June 30, 1930.
The installation of paper wipers to replace cotton wipers on plateprinting power presses was completed during the early part of the
fiscal year. On August 1, 1928, the rag laundry, where cotton wipers
were reconditioned for reuse on presses, was discontinued.
The custody of electrotypes was transferred from the plate vault.
to the surface printing division, where an appropriate record is kept.
Considerable saving in time and labor involved in numerous withdrawals from the vault has been accomplished. These electrotypes
are used for overprinting, are of the commercial type, and do not
need the degree of prpte^^tion afforded by the plate vault to engraved
stock.
160
REPORT ON T H E FUSTAISTCES
Despite the fact that practically the entire time of the officials
and employees of the bureau was devoted to completing the smallsize currency program, a number of experiments were conducted,
with a view to improving methods of manufacture. Two of these
experiments are outstanding; first, an electric drying machine to
replace the present system of drying currency by means of steamheated air; and, second, an automatic trimmer to replace the present
hand-fed trimmer. At present printed currency sheets are removed
from the press and taken into drying rooms where they are placed
on wire racks in small stacks and allowed to dry. To facilitate the
drying, heated air is forced between the sheets. This drying process requires about 12 hours. The sheets do not dry uniformly, as
the edges of the sheets become dry and crisp before the moisture
has been removed from the middle portion of the sheet. This lack
of uniformity in hand drying has been the source of some trouble in
subsequent operations. The machine under test consists of a series
of electric units and is so constructed that it can be attached to the
plate-printing press. As the sheet is taken from the press it is placed
in the drying machine, where it passes between these electrical units
for a given period of time, emerging at the other end of the machine
sufficiently dry to be handled and stored in the vaults for seasoning.
If this apparatus proves successful it will eliminate the slip sheets
now required to prevent offsetting, as well as the labor of placing
the printed sheets on racks in the drying rooms and removing them
after they have been dried.
Sheets of currency are now trimmed on hand-fed machines. Experiments have been conducted on a machine which feeds the sheets
automatically and registers the sheets on the machine, in so far as
mechanical registration is possible, the operator being required only
to complete the registration.
The important studies carried on during the year consisted of
research work in connection with the deposition of iron in making
engraved printing plates; reconditioning pulp by a washing and boiling process in order to give it a greater market value; establishing
automatic temperature control on all rotary presses so that the temperature in the gumming boxes will be uniform at all times; performing research work with a view to eliminating the curling and improving the adhesive qualities of the postage stamps; and continuing the
research work in developing a more durable distinctive fiber paper
for printing currency. In these studies the services of the Bureau of
Standards and the Bureau of Efficiency are being utilized.
The matter of endeavoring to improve the adhesive quality of
postage stamps was given a great amount of attention during the
year. This bureau is being assisted by a committee appointed by
the Postmaster General, consisting of a representative of the Post
161
SECRETARY OF T H E TREASURY
•Office Department and a chemist from the Bureau of Standards and
one from the Bureau of Engraving and Printing.
A history of the bureau was prepared and printed for distribution
to libraries, schools, and the general public. A limited number was
purchased by the bureau and the remainder were placed on sale at
the bureau news stand by the Superintendent of Public Documents
At 10 cents per copy. The number of visitors to the bureau each
year is very large and many have been sufficiently interested in the
operations to purchase copies for more detailed information. During
the first three months the history was placed on sale approximately
4,500 were purchased.
The usual inventories of plates and securities were performed by
the several committees invested with that responsibility. An audit
of the plate vault was made by a departmental committee. An
audit of the stock in the Federal reserve vault was made by the
Treasury auditor. An audit of impression proofs on hand in the
engraving division and all securities of every description in process was
performed by representatives of the Division of Public Debt Accounts
and Audit. In each instance the reports indicate that the securities
and plates on hand were in agreement with the records established in
the auditing offices, as well as those maintained in the bureau.
A comparative statement of' receipts, expenditures, and appropriations for the fiscal years 1928 and""1929 follows:
A p p r o p r i a t e d b y Congress:
Salaries
C o m p e n s a t i o n of e m p l o y e e s .
Plate printing
M a t e r i a l s a n d miscellaneous e.Kpenses
R e i m b u r s e m e n t s to a p p r o p r i a t i o n s from o t h e r
b u r e a u s for w o r k completed:.
C o m p e n s a t i o n of employees
.
Plate printing
M a t e r i a l s a n d miscellaneous expenses i
Total
Net.
1928
1929
$465, 000. 00
3, 659, 590. 00
1,888,000.00
1,160, 000. 00
$574,825.00
3,451,178.00
1, 762, 020. 00
1, 000, 000. 00
$109,825.00
1, 557, 204. 61
437,466. 48
883,471.79
2,152,190.29
666, 142.19
1, 225, 634. 91
594,985. e8
228, 675. 71
342, 163. 12
10,831,990.39
1,275,649.51
10,050,732.88
.
.
491, 392. 00
781, 257. 51
Expended:
Salaries . . .
C o m p e n s a t i o n of employees 2.
_
Plate printing .
. . . .
M a t e r i a l s a n d miscellaneous expenses 3
464, 270.19
5, 207,373. 70
2,307,153. 64
1, 756,198.88
9,734,996.41
Total <
574, 656. 67
5, 559,873. 55
2, 287, 869. 34 .
2,181, 572. 21
10,603, 971. 77
110,386.48
352,499. 85
19,284. 30
425,373. 33
888,259. 66
19, 284.30
868, 975. 36
1
1
729. 81
9,420. 91
18,312.84
287,272.91
168. 33
43,494. 74
140, 292. 85
44,062. 70
34,073. 83
121,980.01
315, 736.47
228,018. 62 1
156,053. 84
561. 48
!1
Net
Decrease
$208,412.00
125 980. 00
160, 000. 00
..
Net.
U n e x p e n d e d balance:
Salaries . _ . .
.
C o m p e n s a t i o n of employees
Plate printing .
. .
_.
M a t e r i a l s a n d miscellaneous expenses
Total
.
.
Increase
243,210. 21
243,771. 69
87; 717.85
^ An additional amount of $47,530.17, received from sale of by-products an'd useless property, was deposited to the credit of the Treasurer of the United States as miscellaneous receipts.
2 Includes $11,000 transferred to Bureau of Standards for research work in the fiscal year 1928.
3 Includes $15,000 transferred to Bureau of Standards for research work in the fiscal year 1929.
< Includes $277,212.25 and $281,014.86 transferred to retirement fund in the fiscal years 1928 and 1929,
respectively
71799—30—Fll 929
-13
162
REPORT ON T H E FINANCES
A comparative statement of deliveries of finished work in the fiscal
years 1928 and 1929 follows:
Sheets
F a c e value,
1929
Classes
1928
Currency:
U n i t e d States notes
Silver certificates
Gold certificates
N a t i o n a l - b a n k currency
Federal reserve notes
.
21,628,000
153, 854, 000
11, 368,000
. . . . . . 14, 999,232
34, 716, 000
17, 659, 000
164, 987, 000
7, 395, 000
14,958, 995
70, 005, 000
$287, 804, 000
659, 948, 000
409, 080, 000
529, 202, 330
2, 686,200, 000
236,565,232
275, 004,995
4,572, 234, 330
.
Total
B o n d s , notes, a n d certificates:
Pre-war b o n d s
Libertv bonds
Treasury bonds
_
T r e a s u r y notes
Certificates of i n d e b t e d n e s s
Insular b o n d s Philippine
Porto Rican
F a r m loan b o n d s
Collateral t r u s t d e b e n t u r e s
P h i l i p p i n e T r e a s u r y certificates
N o t e s for t h e B a n k of t h e P h i l i p p i n e I s l a n d s . . .
I n t e r i m transfer certificates for postal savings
bonds
I n t e r i m certificates for P h i l i p p i n e I s l a n d s
bonds
I n t e r i m certificates for P o r t o R i c a n b o n d s
B o n d s evidencing indebtedness of foreign gove r n m e n t s to t h e G o v e r n m e n t of t h e U n i t e d
States
SpecimensTreasury bonds.
Treasury n o t e s . .
Certificates of i n d e b t e d n e s s
Insular b o n d s Philippine.....
Porto Rican
Consolidated Federal farm loan b o n d s
Collateral t r u s t d e b e n t u r e s
B o n d s evidencing i n d e b t e d n e s s of foreign
g o v e r n m e n t s to t h e G o v e r n m e n t of t h e
UnitedStates
„
Total
11,425K2
188, 8285/^
30, 771%
241,400
94, 350
5,255
218,1431.^
208, 516%
3,025
195, 925
13, 339, 720
544, 035, 000
786. 265, 000
101,150, 000
5,153, 390, 000
2,526
17, 391^^0
423, 856
8, 665
757,400
181,150
2,000
3,138%
140, 425
6,662
712, 000
2, 000, 000
881 500
60,126, 020
210, 625, 000
2,480, 000
1, 000
3,926
4,750
500
873
678
1
. 2%
4
14
3
m
1
m
3
iH
12
3
1, 966,465%o
Stamps:
67, 500
Customs
C u s t o m s for t h e P h i l i p p i n e I s l a n d s . .
_
125, 000
I n t e r n a l revenue—
86, 285, 0272^^8
U n i t e d States (includes o p i u m )
Philippine
73, 457
Porto R i c a n . . .
578, 499
Virgin Islands
300
Specimens, U n i t e d States
4
Postage s t a m p s —
147,102, 085
U n i t e d States
U n i t e d States, surcharged " H a w a i i , 17781928"-...
U n i t e d States, surcharged " Canal Z o n e "
20, 343 J^^
Canal Zone
Philippine
529,9685^
SpecimensU n i t e d States
25IM00
U n i t e d States, surcharged " H a w a i i ,
1778-1928"
...
Postal savings s t a m p s
2,784
Total
1929
1,498.1671H 2
6, 874,292, 240
Subjects
1, 440, 000
5, 000, 000
54, 500
125,000
88,116,2455^8
145, 608%
191, 700
12
151,176, 203
69, 797»Moo
77, 904
545, 936
8,538,883,828
18, 594, 239
19,170, 000
1
6
17, 048, 393, 600
6,979,794
7, 917, 840
55,159,200
338MOO
25, 579
2M&0
. 3,127
206
312, 700
234,784,99334^10 240,506, 3741119^700! 25, 701, 876, 992
163
SECKETAKY OF T H E TBEASUKY
Sheets
Face values.
1929
Classes
1928
Miscellaneous:
Checks
Drafts
Warrants
Commissions .
Certificates
. Transportation requests...
Liquor permits
other miscellaneous..
Blank paper
Specimens
_
Total
1929
6, 384,294%
700
50,080
lOO; 674%:
1, 359,148
153,285
1,945, 666%
138, 356%
2,023
5,012i%6
10,139,240i6%so
i
;
6,444,818% '
6,825
47, 341
Mj.092.
1,16», 172%
347,490
4,484,991%
i92,627i%o
10,464
1,339
Subjects
$32,246,905
14,800
223,541
36, Oil
3,143,569
1, 737,450
18,530,700
2, 899,744
12, 733,161 Mo
6,421
58,838,141
483,455,93156^66 529,742,698i'72%560
G r a n d total
The following statement shows total deliveries made, total expenses,
and average number of employees engaged by the bureau since 1878:
Fiscal
year
Total num-.
ber of sheets
delivered
1878
1879
1880
1881
1882
1883
1884
1885
1886
1887
1888.
1889
1890
1891......
1892
1893.
1894
1895
1896
1897
1898
1899
1900
1901.
1902
1903
13,098,756
21, 394, 030
23,438, 798
26,017, 661
31,112,484
33,330,746
30,205,865
28, 217, 706
26, 655, 496
32, 652, 207
38,040,984
39, 207,164
36,512,719
46,390, 381
52, 508,438
48,853, 528
55, 516, 961
70,886,033
85,050,595
86,174,766
92,979, 478
112,161,122
116,909,423
121, 558, 291
139,167,359
155, 743, 691
Expenditures
$538, 861. 33
814,077. 01
883,171. 95
901,165. 26
936,757.62
1,104,986.43
977,301. 85
965,195. 47
763,207.84
794, 477.90
948,995.83
932,577. 78
. 1,012,.789.18
. 1, 265, 263. 29
1; 316,585.89
1, 238,464. 36
1, 317,389. 61
1,439, 265. 94
1,469, 359. 70
1, 450, 611. 86
1, 570, 598. 46
1,884,441. 39
2,011,702.01
2, 393, 4.94. 26
2,967,091. 74
3,136, 477. 73
Average
number
of employees
Fiscal
year
Tbtal numb e r of sheets
delivered
522
1904
159,918,061
804 1 1905
165,354,514
905
1906
180i289,766
958
1907
201,123, 528
1, Oil
1908
210,589,197
1,17.3 1909
239,405,723
1,193. l'9ia.
252, 710; 864
1,133
1911
262,806,113
886
1912
262,434, 739
840; 1913
287,192,192
895
1914
280,272,828
917
1915
307,634,334
992' 1916
300,711,800
1„161 ,1917
. 343,345,005
1V358- 19i8-.._.J. 396,790,285
1, 333 1919
447,464,105
1,380
1920'.
402,711,759
1,427
1921
438, 694,824
1,519
1^221
416,'820,113
1,605
1923
411, 546, 429
1, 623 1924'.
: 431,868,658
1,903
1925
464,869, 695
1,999
1926
' 482,307,106
2,364
1927
490, 264,868
2,672
1928
483,455,932
2,850
1929
529,742,699
Expenditures
$3,159,940. 69
3, 292, 217.06
3,355,186. 23
3,849,064. 39
3, 841,173. 60
4, 355,935. 65
4,375, 365. 57
4,180, 284. 20
4,319, 246. 57
4, 449, 726. 22
4, 372,922.81
5, 039, 204. 80
5,066,048. 72
6,324,118.;70
9,086,303. 90
11, 571,186.10
11,854,171.45
13,965,233.57
10,812, 756.38
10,106, 320. 28
9, 401,925. 68
10,041,457. 46
10; 483,674.68
10; 415, 742. 42
9,734,996.41
10, 603, 971. 77
Average
number
of e m ployees
2,928
3,002
3,084
3,437
3,572
3,977
3,964
3,814
3,899
3,920
3,932
4,119
4,048
4,221
6,214
7,508
6,912
7,097
6,416
6,535
4,980
5,098
5,173
5,097
4,979
4,920
COMMITTEE ON ENROLLMENT AND DISBARMENT OF ATTORNEYS
AND AGENTS
The committee on enrollment and disbarment of attorneys and
agents, created by Department Circular No. 230, dated February 15,
1921, is responsible for the examination of applicants wishing to
practice as attorneys, agents, or other representatives before the
Treasury Department or offices thereof, and receives complaints,
conducts hearings, and makes inquiries concerning violations of the
regulations by enrolled practitioners. The conclusions of this committee in each case are submitted as recommendations to the Secretary of the Treasury.
- During the fiscal year 1929, 2,626 applications for enrollment of
attorneys and agents were approved and 37 were disapproved.
Since the organization of the committee in 1921, 25,3,55 applications
have been approved and 430 disapproved. Some 8,600 persons were
enrolled prior to the organization of the committee and many of
them are now in active practice.
A large part of the committee's work arises from complaints filed
with the committee charging violations by enrolled practitioners of
the regiilations governing practice before the department. All such
complaints are carefully investigated, and, if found sufficient to warrant action, a formal complaint is prepared by the committee's
attorney, to which the respondent is required to answer under oath.
If the answer is accepted as satisfactory, the complaint is dismissed;
otherwise a formal hearing is held by the committee at which the
respondent may appear in person and be represented by counsel.
A respondent in any such disbarment proceedings is entitled to a
triaraccording to ''due process of law''; therefore all such hearings
before the committee are conducted with practically the same formality and under the same rules of law which apply to trials in civil
actions. After the hearing the committee reports to the Secretary
its findings of facts, and if it is found that the complaint has been
proven the committee recommends that the respondent be disbarred
from further practice before the department, suspended from practice
for a definite period, or reprinaanded.
On June 30, 1928, formal complaints against 111 individuals were
awaiting final disposition. During the past year 65 new complaints
were filed. In 19 cases the answer of the respondent was accepted
as sufficient and the complaint was dismissed. In 64 cases formal
hearings were held; in 26 of these cases it was found that the charges
were not proven and the complaints were dismissed. In 38 cases
164
SECRETARY OF THE TREASURY
165
the charges were found proven in whole or in part and the Secretary
imposed penalties as follows: 15 were disbarred from further practice
before the Treasury Department, 14 were suspended from practice
for various periods, and 9 were reprimanded. At the close of the
year there were 93 complaints awaiting final disposition. During
the year the orders of disbarment in the cases of two individuals
were terminated and they were restored to good standing before the
department. Since the organization of the committee in 1921, 69
practitioners have been disbarred, 86 have been suspended for
various periods, and 106 have been reprimanded.
It is the policy of this committee, when deemed advisable, to give
an attorney or agent opportunity to show cause why formal disbarment proceedings should not be instituted against him; 14 such cases
occurred during the year.
FEDERAL FARM LOAN BUREAU
Operations of Federal land banks
During the fiscal year 1929 the Federal land banks closed 22,091
loans, amounting in the aggregate to $81,967,400. These brought
the total credit extended by these banks from organization to June
30,1929, to 493,632 loans in an amount of $1,584,548,964.87. The net
amount of mortgage loans outstanding as of June 30, 1929, was
$1,204,915,569.79; and the amount of farm loan bonds issued by
Federal land banks and outstanding on the same date, including
$26,325 of bonds matured or called for redemption, was $1,177,201,025.
These amounts represent increases of 1.7 and 1.4 per cent, respectively,
over the loans and bonds outstanding on June 30, 1928.
During the fiscal year four banks increased their loan rates from 5 to
5}^ per cent, two of the four again increasing their rate to 5^ per cent.
Another bank increased its rate from 5 to 5K per cent. Since June 30,
1929, seven additional banks have increased their rate of 5% per cent,
so that on September 14 ther.e was one bank loaning at 5 per cent,
one at 5K per cent, and 10 at 5K per cent.
National farm loan associations decreased in number during the
fiscal year from 4,672 to 4,664.
The combined capital stock of all Federal land banks on June 30,
1929, amounted to $65,692,356.25, of which $64,512,162.50 was
owned by national farm loan associations; $133,260, by borrowers
through agents; $445, by individual subscribers; $663,460, by individual subscribers through the Porto Rico branch; and $383,028.75,
by the Federal Government. This latter figure was decreased from
$555,700 during the year through retirement in the manner provided
by the farm loan act. Aside from special reserves set up against
particular assets, the 12 banks reported legal and other reserves and
undivided profits of $17,623,326.79. The special reserves against
real estate, delinquent installments, etc., aggregated $15,955,884.93.
166
167
SECRETARY OF T H E TREASURY
The following table shows the net mortgage loans and total assets,
together with important liabilities of each bank:
Selected asset and liability items of each Federal land bank, June 30, 1929
Reserves a n d
undivided
profits 3
Net mortgage
" loans
$55,280,017
73, 749, 300
72, 741, 739
$50, 768, 487
69, 557,635
63, 764,374
$50,668, 500^^
67, 507, 240
67,489, 560
$3,020, 278
3,802,180
3,470,082
$451,349
833,405
522,141
Louisville
N e w Orleans
St. L o u i s . .
129,147, 647
121,867,883
113,051,486
124,074,844
111, 049, 778
107, 490, 660
117,488, 260
111, 637, 340
102,643,880
6,662, 390
6,186, 550
5,772, 225
2,706,705
1, 893, 765
780, 539
St. P a u l .
Omaha
Wichita...
138, 388,104
173,924, 037
96, 001,123
123,615, 657
• 166,993,181
89, 945, 296
127, 350,080
158, 523, 580
87,829, 520
6,802, 255
8,903, 975
4,746, 995
1, 257, 499
3,043, 439
1, 331, 523
154, 341,136
56, 582, 546
105, 283, 863
149, 688, 350
52,300,132
95, 667,175
139, 595, 540
51,842, 940
94, 598, 260
8,010, 205
3, 084, 209
5, 231, 013
4,129,852
672,723
387
1, 290, 358, 881
1, 204, 915, 570
1,177,174, 700
65, 692, 356
17, 623, 327
Springfield.Baltimore
Columbia
HoustonBerkeley. _
Spokane
Total
... .
:
Bonds outstanding 2
Capital
stock
T o t a l assets i
N a m e of b a n k
1 Total assets have been decreased by the amount of special reserves set up against particular assets.
2 Bonds on hand and bonds matured'or called but not yet presented for payment are not included.
3 Special reserves set up against particular assets not included.
Operations of joint stock land banks
On November 30, 1928, one of the joint stock land banks purchased
the assets and assumed the liabilities of another, reducing the number
from 50 to 49, including one in process of voluntary liquidation, but
not including the three in receivership.
Loans numbering 5,358 and amounting to $29,667,433.67 were made
by the joint stock land banks during the year, bringing the total
closed by these banks from organization to June 30, 1929, to 127,271
loans in an amount of $882,728,770.21.
The combined capital stock of the 49 joint stock land banks in
operation on June 30, 1929, as shown by reports submitted by them
to the Farm Loan Board, was $41,744,310.24. Of these banks, 45
reported legal and other reserves, surplus paid in, surplus earned, and
undivided profits aggregating $11,219,698.34. The remaining four
banks showed deficits totaling $2,094,598.84. I n addition to the reserves included above, joint stock land banks had reserves set aside
against particular assets such as real estate, delinquent installments,
etc., amounting to $2,475,860.10. The net amount of mortgage loans
outstanding as of June 30, 1929, was $597,955,853.87, and the amount
of farm loan bonds issued by joint stock land banks and outstanding
on June 30, 1929, was $583,747,100, mcluding $53,100 bonds matured
or called for redemption.
In addition, the three banks in receivership had $44,934,215.68 of
mortgage loans outstanding. The outstanding bonds of these three
banks at the time they were placed in receivership totaled $61,518,600,
but on August 31, 1929, this amount had been reduced to $59,050,895
by payments on account of liquidating dividends of 15 and 10 per cent
168
REPORT ON T H E FINANCES
authorized by the board for the Bankers Joint Stock Land Bank of
Milwaukee and Ohio Joint Stock Land Bank of Cincinnati, respectively.
The following table shows the net mortgage loan and total assets,,
together with important liabilities of each bank:
Selected asset and liability items of each joint stock land bank ^, J u n e 30, 1929
Name and location of bank
Total
assets 2
Atlanta, Atlanta, Ga
$6, 556, 993
Atlantic, Raleigh, N. C
16, 754, 546
Burlington, Burlington, Iowa.
4, 054, 080
California, San Francisco, Calif
16, 963, 561
Chicago, Chicago, 111
54, 984, 845
Dallas, Dallas, Tex
45, 463, 839
Denver, Denver, Colo...
15, 573, 559
Des Moines, Des Moines, Iowa
14, 662,137
First Carolinas, Columbia, S. 0
13, 256, 525
8, 732, 900
First, Fort Wayne, Ind
First, Montgomery, Ala
9, 669, 679
First, New Orleans, La
4, 604, 450
First Texas, Houston, Tex
8, 319, 570
First Trust, Chicago, 111
76, 889, 087
Fletcher, Indianapolis, I n d . .
: . . . 16, 464, 367
Fremont, Lincoln, Nebr
9, 850, 825
Greenbrier, Lewisburg, W. Va
2, 847,049
Greensboro, Greensboro, N. C
5, 446.412
Illinois, Monticello, 111
7, 345, 329
Illinois Midwest, Edwardsville, 111
6, 223, 246
570, 237
Indianapolis, Indianapolis, Ind.
8,112,813
Iowa, Sioux City, Iowa..
Kentucky, Lexington, Ky._.
12, 518,457
9. 803,886
La Fayette, La Fayette, Ind
Lincoln, Lincoln, Nebr...
39; 170, 720
7, 538, 771
Louisville, Louisville, Ky
2, 707, 772
Maryland-Virginia, Baltimore, Md
5, 238, 208
Minn. Trust, Minneapolis, Minn
4, 472, 606
Mississippi, Memphis, Tenn
New York, Rochester, N. Y
14, 976, 339
15, 234, 325
North Carolina, Durham, N. C
103, 599
Northwest, Portland, Oreg..
14, 588,865
Ohio-Pennsylvania, Cleveland, Ohio
Oregon-Washington, Portland, Oreg
3, 686, 856
Pacific Coast, Portland, Oreg
7, 786, 017
Pacific Coast, Salt Lake City, Utah
5, 001, 736
Pacific Coast, San Francisco, Calif
23, 634, 025
Pennsylvania, Philadelphia, Pa
7, 321, 586
Potomac, Washington, D. C
6, 905, 908
St. Louis, St. Louis, Mo
^.- 22,498. 420
20, 481, 344
San Antonio, San Antonio, Tex
Southern Minnesota, Minneapolis, Minn. 26, 933, 027
Southwest, Little Rock, A r k . . .
4,893, 879
Tennessee, Memphis, Tenn
3, 910,881
Union, Detroit, Mich
10, 304,126
Union, Louisville, Ky
3, 286. 835
Union Trust, Indianapolis, Ind
483, 948
Virginian, Charleston. W. Va
16, 859, 674
Virginia-Carolina, Elizabeth City, N. C.
7, 659, 951
651, 347, 808
Total..
Net mortgage loans
$5, 957, 550
16, 069, 943
3, 662,193
14, 346. 961
47, 327, 296
42,393, 836
14, 750, 395
11,442,460
11, 951, 801
8, 361, .796
9, 073, 751
4, 272, 709
7, 628, 557
75, 747. 717
15, 659, 655
8, 899, 906
2, 739, 018
5, 038,188
7,154, 050
5, 940, 593
475, 837
7, 340, 622
11,409,925
9,412,291
36,147, 041
6,154, 960
2, 605, 969
5, 001, 271
4,119, 814
14, 205, 333
14, 310, 325
41,642
13, 999, 399
3, 339, 317
7, 431, 776
4, 708, 080
22,252,491
6, 910, 269
6, 583, 030
21, 049, 014
19, 490, 644
18, 941,126
4, 641, 780
3, 638, 361
9, 624, 684
2, 822, 929
387, 494
15, 534, 395
6, 897, 665
597, 955, 854
Bonds outstanding 3
$6, 000, 000
14, 656, 500
3, 649, 500
15, 220, 000
50, 264, 700
40, 381, 000
13, 769, 000
13,134, 000
12,197,000
7, 768, 600
8, 795, 000
4, 047, 000
7, 515, 000
09, 340. 000
14, 636,100
5, 610, 000
2, 472, 000
4, 773, 000
6, 710, 000
5, 508, 000
300, 000
7,199, 000
11,400.000
8, 998, 500
35,125, 000
6, 882, 000
2, 300, 000
4, 450, 000
3, 874, 000
13, 500, 000
Capital
stock
$350, 000
907, 500
250, 000
916, 000
4, 000, 000
2, 571, 200
1,184, 800
1,150, 000
785. 000
400, 000
550, 000
250, 000
550, 000
4, 600, 000
750, 000
850, 000
250, 000
250, 000
450, 000
350, 000
250,
500,
650,
300,
2, 711,
500,
250,
450,
350,
800,
000
000
000
000
400
000
000
000
000
000
700, 000
88, 410
13,175, 500
770, 000
3, 318, 000
250, 000
6, 925, 000
450, 000
4, 489, 000
300, 000
21, 412, 000 1, 400, 000
418, 500
6, 593, 000
400, 000
6, 224, 000
20. 322, 000 1, 430, 000
18, 437, 500 1, 226, 500
23, 576, 800 3, 000, 000
285, 000
4, 396, 000
250, 000
3, 474, 000
600, 000
• 9, 024, 500
250, 000
2, 965, 000
250, 000
152, 000
1,150, 000
15,112,800
400, 000
6, 922, 000
583, 694, 000 41, 744, 310
13, 700, 000
Surplus,
reserves,
and undivided
profits *
$99,279413, 847
6.1,123 •
530, 306.
(»)
785, 519303,782-
(«)
(«)
485,192169,543.
108,399'
152, 665^
789, 972 •
768, 507
214, 401
63,818202,112^
86,143.
93, 419^
8,165302, 951
235,408.
401, 344
648.174.
62, 744
119,536292,183160,998209, 434
493, 704
15,017'
298, 901
48,450'241, 4.69'
76, 599 •
351,017
90,734161,645"
339, 201
310,18876, 010 •
106,368212,173
31, 462 •
74, 226340, 664
182, 90611, 219, e
1 Joint stock land banks in receivership not included.
2 Total assets have been decreased by the amount of biccial reserves set up against particular assets.
3 Bonds on hand and bonds matured or called but not yet presented for payment not included.
^ Special reserves set up against particular assets not included.
s These banks had deficits as follows: Chicago, $956,871; Des Moines, $313,180; First Carolinas, $174,062;;
and Southern Minnesota, $650,485.
Receiverships
The affairs of the three joint stock land banks in receivership havebeen handled by their respective receivers under the supervision of
|)|ie Farm h g m Board, Of first importance in the administration ol
169
SECRETARY OF THE TREASURY
these trusts has been the valuation of the banks' assets, in order
that their true condition might be determined more closely. On
February 28, 1929, the receiver of the Kansas City Joint Stock Land
Bank published a report of his comprehensive valuation of the assets
of that bank. Valuation reports by the receivers of the other two
banks had previously been issued. The receivers found that in each
•case the deficit indicated by their valuation exceeded the amount of
the bank's entire capital stock. Assessments, therefore, were levied
upon the stockholders in amounts equal to 100 per cent of par value
of the capital stock. The dates when the assessments were levied,
the total amount assessed, and the amount paid in by stockholders
•on August 16, 1929, for each bank are as follows:
Name of bank
Kansas City..
Bankers
Ohio
Date of
assessment
Mar. 23,1929
Jan. 11,1928
Apr. 6,1928
Total
assessment
$3,800,000
1, 200,000
250,000
Amount paid
in on Aug.
16, 1929
$223, 676. 25
522, 375. 00
38,625. 00
As stated elsewhere in this report, the Supreme Court of the United
States, on October 21, 1929, will hear oral argument in the case
involving the right of the receiver of the Bankers Joint Stock Land
Bank of Milwaukee to enforce such an assessment.
The possibilities of reorganization have been considered for each
bank. The bondholders' protective committee of the Bankers Joint
Stock Land Bank has worked out a plan which contemplates the
purchase by a liquidating corporation of the assets of the receivership
and this matter is under consideration. The bondholders' protective
committee of the Kansas City bank has been endeavoring to devise
a satisfactory plan for the reorganization of that institution, and this
matter also is under consideration. The receivers of the Bankers
Joint Stock Land Bank and also of the Ohio Joint Stock Land Bank
have paid initial liquidating dividends, but none has been declared
i n the case of the Kansas City bank.
Reports have been issued by the various receivers as follows:
Kansas City, October 19, 1927, January 4, 1928 (letter to bondholders' protective committee), April 30, 1928, and February 28,
1929; Bankers, December 31, 1927, March 31, 1928, and December
31, 1928; and Ohio, March 31, 1928, and February 28, 1929. In
addition, the Farm Loan Board includes in its quarterly pubhcation
and ih its annual report a statement of the condition of each bank
-as reported by the receiver upon the basis of the books of the bank.
Operations of Federal intermediate credit banks
During the fiscal year these banks made original loans to cooperat i v e marketing associations of $36,289,396.59 and granted renewals
'of $20,407,529.21. These amounts brgught the original advances
170
REPORT ON THE FINANCES
from organization to June 30, 1929, to $271,264,411.68 and the
renewals to $170,143,913.11. The loans outstanding on that date
were $9,030,938.87.
Original discounts closed during the year amounted to $55,225,041.78 and renewals of discounts to $33,372,252.54. This business
brought the total original discounts closed from date of organization
to June 30, 1929, to $262,523,017.26 and the discounts renewed to
$125,987,477.69. The total discounts outstanding on that date
were $59,069,937.91.
Under the law, 50 per cent of the net earnings of the Federal intermediate credit banks each year must be paid into the Treasury as a
franchise tax. The amount of net earnings for the calendar year
1928, after providing reserves of $469,221.66, was $516,173.02 and
the amount of franchise tax paid into the Treasury was $258,086.51.
This compares with net earnings during the calendar year 1927 of
$737,551.75 after deducting reserves of $428,777.89. The franchise
tax for that year was $368,775.88.
On June 30, 1929, the surplus, reserves, and undivided profits of
11 of the banks aggregated $2,787,952.06. The remaining bank had
adeficit of $912,214.61.
Because of the advances in the interest rate at which their debentures had been issued, as a result of the general condition of the
money market, the loaning rates of these banks were higher at the end
of the year than at the beginning. On September 14, 1929, five
banks were making loans at 6 per cent; one at 5% per cent; four at 5K
per cent; one at 5)^ per cent; and one at 5 per cent. On discounts,
the rate for six banks was 6 per cent; one bank, 5% per cent; four
banks, dji per cent; and one bank, 5 per cent. The discounts made
by the Porto Rico branch were at the rate of 6)^ per cent.
The following table shows the loans and discounts and total assets,
together with important liabilities, of each bank:
Selected asset and liability items of each Federal intermediate credit bank, June 30,
1929
Total assets
Name of bank.
Springfield
Bal timore
Columbia..
Louisville . . .
New Orleans
St. Louis
St. Paul
Omaha
Wichita
Houston . . .
Berkeley
Spokane
Total -
.
.'
..
...
-
..
$5,304,507
7,533,032
6,866, 912
5. 341,352
11, 012,877
5,287,761
9,798,630
. 9,481,090
5,707, 933
14, 721,390
15,955,165
9, 937, 672
106,948, 322
Loans and
discounts
Debentures i Paid-in capital stock
outstanding
$1,187,428
2,833,026
5,251,606
846,392
7, 535,817
1, 372,038
6,486,082
6, 473,188
2, 577,276
11, 428,194
15,311,951
6,797,878
68,100,877
1 Debentures held by banks of issue are not included*
$1,700,000
•1,735,000
4, 300, 000"
4,345, 000
3.000, 000
350,000
8, 760, 000
8,140, 000
2,430, 000
34, 760,000
Surplus reserves and
undivided
profits
$2,000,000
2,000,000
5,000,000
2,000,000
2,000, 000
2, 000, 000
2,000,000
2,000, 000
2,000,000
2, 000,000
5, 000, 000
2,000,000
30,000,000
2 Deficit of $912,215.
$269,963
328,977
(2)
323,604
169,004
214,211
271,473
318,116
307, 912
323,919
260,773
2, 787,952
SECTION OF FINANCIAL AND ECONOMIC RESEARCH
The activities of the section during the fiscal year 1929 are summarized below under four general divisions:
1. Confidential studies were made upon request providing information for the guidance of Treasury oflScials in formulating the policies of the department and in improving Treasury methods and
records. The usual estimates of tax receipts for the two succeeding
years were prepared. Various statistical studies were made to improve estimating methods 3 applied to these various taxes. In this
connection, further analysis! was made of the reliability of pubhshed
corporation profits in indicj ating the net income of corporations to
be reported for taxation, I Various suggestions for improvement in
the tax data compiled by tl ie Treasury developed from these studies.
Desk and wall charts for bhe use of various Treasury officials, indieating monthly changes in economic and financial conditions, were
continued and new charts vieve prepared.
2. Under the general supervision of the Undersecretary of the
Treasury, the annual report! of the Secretary of,the Treasury for 1928
was outlined, assembled, eel ited, and indexed, and part of the material in the body of the rejbrt was prepared by this section. Work
was continued on a cumul itive index of the annual reports of the
Secretary of the Treasury for the years 1913-1927. The section also
assisted in editing the Statistics of Income for 1927.
Articles discussing varioiis phases of our public finances appearing
in periodicals, encyclopedi! as, etc., under Treasury authorization,
and statistical material to l e used in addresses delivered by Treasury
officials were prepared in jlart or in whole in this section. Articles
discussing Treasury financp written by outside organizations were
checked and verified.
3. The financial and economic information service to Members of
Congress and to the genera! public was continued. A diversified correspondence was handled covering Treasury financing taxation,
public debt, currency, Fedieral reserve system, banking, corporate
finance, and similar topics.
Tabulations of special information were prepared periodically for
general use. An estimate was issued each month of the tax-exempt
bonds outstanding at the ([ad of the month, which includes an estimate of the total outstanding State, local. Territorial, and insular
indebtedness. There was also prepared each month a statement of
the maturities of the public^debt by classes for the succeeding five-
I'
!
•
.
•
.
171
172
REPORT ON THE FINANCES
year period. During the sessions of Congress a digest was made and
distributed daily of the progress of financial and banking legislation.
A study of gold stock figures, involving the analysis and harmonizing of the gold data issued by the Bureau of the Mint, Federal Reserve Board, and the Department of Commerce, was inade during
the year. Several studies of the public finances of foreign governments and the financial conditions of foreign countries were prepared.
4. One hundred and twenty-one volumes and 17 periodicals, besides a large number of valuable reports and pamphlets, were added
during the year to the general Treasury library, which is a part of
this section, and to the library of standard and recent books and of
important domestic and foreign periodicals maintained within the
section for the use of the entire Treasury staff. The index of material
in current periodicals and other pubhcations on subjects of interest to
the Treasury was continued. Bibhographies were prepared for various Treasury officials and the public.
BUREAU OF INTERNAL REVENUE
General
Internal revenue receipts.—Receipts ^ from internal revenue taxes
during the fiscal year 1929, compared with 1928, were as follows:
1928
Sources
I n c o m e tax: i
Corporation
I n d i v i d u a l -.
$1, 291,845,989. 25 $1, 235, 733, 256. 24 -$56,112,733. 01
882, 727,113. 64 1,095, 541,172. 40 +212,814, 058. 76
2,174, 573,102.89
Total.
E s t a t e s of d e c e d e n t s .
^
Distilled spirits a n d alcoholic beverases
ReceiDts u n d e r n a t i o n a l p r o h i b i t i o n
Tobacco m a n u f a c t u r e s , etc
Oleomargarine, a d u l t e r a t e d and process or renov a t e d b u t t e r , filled cheese a n d mixed flour
B o n d s of i n d e b t e d n e s s , capital slock issues, c a p i t a l
stock transfers, sales of produce for future deliverv, and playinEj cards
Excise taxes, m a n u f a c t u r e r s ' , including a u t o m o biles 2
Corporations, on capital stock 3
L^se of foreign-built v a c h t s , etc.*.
Admissions to theaters a n d other places of a m u s e m e n t , a n d club dues . .
..
N a r c o t i c s : O p i u m , coca leaves, etc., including
special taxes of i m p o r t e r s , m a n u f a c t u r e r s , a n d
dealers..:...
I n t e r n a l r e v e n u e collected t h r o u g h c u s t o m s ofiices..
O t h e r miscellaneous receipts *
T o t a l miscellaneous taxes
Total internal revenue receipts..
Increase (-1-) or
decrease (—)
1929
.
2,331. 274, 428. 64 +156,701,325. 75
60, 087, 233. 97
15, 307, 796. 45
925, 252. 22
396, 450, 041. 03
61.897,141.48
12, 776. 728. 46
727', 005. 93
434,444, 543. 21
+ 1 , 809,907. 51
-2,531,067.99
- 1 9 8 , 246. 29
+37,994, 502.18
3,422, 702. 90
3, 623,393. 97
+200,691. 07
. 48,829, 208. 24
64,173, 530. 84
+15,344,322. 60
51,036, 591. 28
8, 688, 502. 39
9, 763. 47
5, 711, 550. 04
5, 956, 295. 57
- 4 6 , 225,041. 24
- 2 , 732, 206. 82
- . 9 , 763. 47
28,077, 941. 91
17, 328,310. 47
— 10,749,631.44
690,432. 41
21, 216. 94
1, 515, 751. 58
605, 336. 04
4,479.18
531, 631. 60
- 8 5 , 096. 37
-16,737.76
-984,119.98
607, 779, 946. 79
—8,182, 488. 00
615,962,434. 79
2, 790, 535. 537. 68
2, 939, 054, 375. 43 +148, 518,837. 75
1 Includes income tax on Alaska railroads (act of July 18, 1914) amounting to $14;,658.19 for 1928 and
$13,517.52 for 1929.
2 Tax on automobiles repealed, effective May 29, 1928. Delinquent tax collections are $5,545,865.90
for 1929.
3 Tax repealed, effective July 1, 1926.
•».Tax repealed, effective July 1, 1928.
8 Includes $1,467,626.93 for 1928 and $440,386.82 for 1929, delinquent taxes collected under repealed laws-.
I
Refunds.—In the foregoing statement of receipts no deductions
have been made on account of refunds, which during the fiscal year
1929 were paid from the several appropriations as follows:
Refunding taxes illegally collected 192.7 and prior years
Refunding taxes illegall}' collected 1928 and prior years
Refunding taxes illegally collected 1929 and prio-r years
Net total
'
S13, 705. 67
7, 321, 603. 50
182, 829, 050. 31
190, 164, 359. 48
1 The figures concerning internal revenue receipts as given in this statement differ from such figures
carried in other Treasury statements showing the financial condition of the Government, because the
former represents collections by internal revenue officers throughout the country, including deposits by
postmasters of amounts received frora sale of internal revenue .stamps and deposits of internal revenue
collected through customs offices, while the latter represent the deposits of these collections in the Treasury
or depositaries during the fiscal year concerned, the differences being due to the fact that .some of the
collections in the latter part of the fiscal'year can not be deposited, or are not reported to the Treasury as
deposited until after June 30, thus carrying ttiem into-the following fiscal year as recorded in the statements
showing the condition of the Treasury.
173
174
REPORT ON T H E FINANCES
The following is a summary of these refunds showing the number
of schedules and claims, amount refunded, and interest allowed on
each class of tax:
Class of tax
Number of Number of
schedules
claims
Amount refunded
Interest included
Capital stock
Estate
Income
Miscellaneous
Sales
Spirits, narcotics,
Tobacco
125
1,488
6,314
42
227
21
29
1,319
2,024
130, 559
137
3,454
347
39
$2,408, 247. 90
17, 234, 384.13
165, 363,940. 84
45, 671.15
4, 996, 960.18
113, 314. 14
1,841.14
.$411,932. 22
1,191,199. 32
38, 768, 622. 33
6,858. 80
524, 476. 01
1,911.39
57.77
Total
8,246
137, 879
190,164, 359. 48
40, 905, 057. 84
In addition' to the foregoing, the following refunds were made from
funds provided under specific appropriations:
N u m b e r of N u m b e r of
schedules
claims
Appropriation
R e d e m p t i o n of s t a m p s
R e f u n d i n g legacy taxes, act M a r c h 30, 1928.
R e f u n d i n g a u t o m o b i l e a n d cigar taxes, 1926 a n d
1927
P a y m e n t of taxes erroneously collected u n d e r act
of J u n e 13, 1898
Total
A m o u n t refunded
$773, 482. 92
418,180. 41
Interest
included
136
19
4,499
342
4
8
420. 71
7
7
25,090.39
8, 788.15
166
4,856
1, 217,174. 43
91, 401. 91
$82, 613. 76
Cost of administration.—The amount expended and obligated in
administering the internal revenue tax laws for the fiscal year 1929
was $34,377,082.59, not including the amount expended for refunding taxes illegally or erroneously collected, which is in no sense an
administrative expense. The aggregate receipts of internal, revenue
were $2,939,054,375.43, which makes the cost of operation for the
fiscal year 1929, $1.17 for each $100 collected, the same as the cost
of operation for the fiscal year 1928.
Income Tax Unit
Examination of returns.^—The number of returns examined and
closed during the year was 2,198,695, of which 1,586,971 were filed
by individuals and partnerships and 611,724 by corporations. The
number, closed during the preceding fiscal period was 3,247,703.
The reduced production as compared with the preceding year is more
a,pparent than real. It results from the transfer of the classification
of returns—which is to select the returns to be closed in Washington
and those which are to be referred to the field for examination—
to the preliminary audit section of the clearing division in Washington. For the three preceding years this work was done in the field
offices. As a result of this change of procedure the work of audit
SECRETARY OF T H E TREASURY
175
began at a later date, in consequence of which but 1,114,519 of the
1928 accepted returns, or returns t h a t will require no further consideration, are included in the total production to June 30, 1929.
The difference in production, therefore, is in respect only to the
character of closing, which has no especial significance. Were it
possible to bring into the figures for the past fiscal year the total
number of returns that will be closed as submitted by taxpayers,
there would be no decline in production.
For the coming year the production should be comparable with that
for the fiscal year 1928, since the balance of the 1928 returns to be
accepted will be included as well as a part of the 1929 returns.
Additional revenue.—The total additional revenue made available
for collection was $260,227,744.14, compared with $266,657,218.72
for the previous fiscal year. Of the amount of additional revenue
for 1929, $170,686,211.37 was assessed in Washington under.regular
procedure, the interest and penalties of such assessments amounting
to $30,001,598.77 and $1,809,207.44, respectively, making a total of
$202,497,017.58 in regular assessments. In addition assessments
in the amount of $36,146,432.17, covering the period from June 1,
1928, to .May 31, 1929, were listed under the provisions of mimeograph
3552, the effect of which is to shorten the interest period by routing
deficiency tax cases, agreed to by taxpayers, to collectors, for listing
and immediate collection, prior to the reference of such cases to Washington. Penalties and interest on these assessments amounted to
$14,497.19 and $3,148,446.53, respectively. Claims in abatement
and credit aggregating $18,421,350.67 were rejected.
Of the $202,497,017.58 assessed in regular taxes, penalties, and
interest, $85,350,630.13, or 42.2 per cent, was based on agreements
executed by taxpayers prior to the mailing of 60-day letters; $16,425,074.62, or 8.1 per cent, was assessed on agreements executed by
taxpayers and filed subsequent to the mailing of the 60-day letters;
$43,754,229.66, or 21.6 per cent, was listed on cases wherein taxpayers
failed to file appeals within the 60-day period and $56,967,083.17,
or 28.1 per cent, was entered after decisions by the Board of Tax
Appeals.
The amount of taxes assessed under the jeopardy provisions of the
^several revenue acts was $36,668,958.53. Of this amount $22,580,189.76 was assessed under bankruptcy and dissolution procedure,
while $14,088,768.77 was assessed in cases wherie it was b?iieved
the return was fraudulently rendered. Penalties totaling $8,509,137.67 and interest in the sum of $5,687,329.38 were hsted in connection with these assessments. The total amount assessed under
the jeopardy provisions of the law, therefore, was $50,865,425.58.
During the previous year jeopardy assessments, penalties, and interest
totaled $45,685,725.80.
176
REPORT ON THE FINANCES
Petitions were filed with the Board of Tax Appeals in respect of
proposed assessments amounting to $139,025,440.05. Penalties
totaling $11,992,406.29 were involved in the cases so petitioned.
Claims and overassessments.—During the year 50,120 claims were
adjusted, of which 34,735 were allowed, either in full or in part, and
15,385 were rejected. The number of certificates of overassessment
issued in cases where no claims were filed was 42,329. During the
previous year the number of claims adjusted was 46,031 and the
number of certificates of overassessment issued was 56,136.
The total amount of overassessments stated for 1929 was $339,528,941.51. Of this amount $176,398,377.58 was satisfied by abatement,
$36,535,245.42 by credit, and $126,595,318.51 by refund. Interest
not included above, in the sum of $38,768,622.33 was paid on the
amounts refunded or credited.'
The total amount involved in rejected claims was $237,573,989.16.
The number of claims filed during the year was 50,299, and the
amount involved $613,052,371.28. During the previous year claims
to the number of 43,981, involving $486,603,619.26, were received. At
the end of the fiscal year there were pending for adjustment 13,250
claims.
There were adjusted during the year 13,264 collectors' claims, of
which 11,704 recommended abatements or credits and 1,560 recommended refunds. These claims were largely of the blanket type and
involved 16,533 items for abatement or credit and 74,342 for refund.
The audit in Washington.—The number of returns pending on
June 30, 1929, before the several audit sections of the Washington
office for the years 1917 to 1926, inclusive, was as follows:
1917
1918
1919
1920
1921
147
193
246
310
306
1922
413
1923
1924____
1925
1926_-_
Total
812
3, 238
4, 890
9, 581
. . 20,136
The audit in the field.—During the year revenue agents and auditors
in the offices of internal revenue agents in charge submitted recommendations for the closing of 455,391 cases. Of this number, thorough audits were made in 315,089 cases, while in 48,350 cases investigation was made of specific items, which to be allowed as deductions, etc., demanded further consideration and support. In 91,952
cases the field forces concluded, after a second survey, that the returns
should be accepted as filed.
Deficiency taxes were proposed in 134,499 cases and overassessments were disclosed in 40,106 returns. Agreements were secured in
128,152 of the 174,605 changed cases. The amount of the deficiencies
to which agreements were secured by the field forces was $65,382,672.32.
SECRETARY OF THE TREASURY
177.
The pending job of the field divisions on June 30, 1929, was to
conduct during the fiscal year 1930, field or office investigations in
98,153 cases for 1927 and prior years and in approximately 350,000
cases for 1928.
Records division,—During the year 2,725,730 individual returns and
584,633 corporation returns were handled by the records division.
There were forwarded to revenue agents for investigation 113,269
individual returns and 151,612 corporation returns, and to collectors
191,000 individual returns.
There were received and routed to the proper destination for audit
review 459,351 reports on returns investigated. Of the total number
of reports received, 327,126 were forwarded by revenue agents in
charge and 132,225 by collectors of internal revenue. There were
returned from collectors and agents 163,440 returns, which upon
review in the field required no examination. In answer to requests
from the office of the general counsel, there were furnished 15,600'
returns and other documents for association and use by that office.
Approximately 11,000 bankruptcy and dissolution cases were forwarded to the office of the general counsel and other offices of the
bureau. In compliance with requests from taxpayers and their
agents, there were furnished 24,136 copies of returns, reports, and
schedules, for which the sum of $10,622 was received. Claims to the
number of 44,540 were assembled and routed to their proper destination.
There were received and sorted 11,694,698 information reports of
salaries, interest, and dividends, and 1,804,076 forms showing names
and addresses of taxpayers, a total of 13,498,774, an increase over
last year of 2,152,782. The additional reports were due principally
to the inclusion of dividends on the regular check size forms. There
were 5,225,550 reports forwarded to the several collectors for comparison with individual returns on Form 1040-A, and for the discovery of delinquent taxpayers. Information reports were compared
with 835,828 individual returns. Form 1040, of the '^accepted class"
on file in Washington, which disclosed understatements of income by
4,642 taxpayers, aggregating $11,312,479, an average of $2,437
unreported income on each erroneous return.
Reduction in number of 60-day letters mailed as related to appeals
filed.—During the year the Income Tax Unit mailed 16,980 60-day
letters, compared with 38,537 issued the previous year. The mailing
of 60-day letters is the final audit action of the Income Tax Unit.
The policy was adopted of not mailing 60-day letters until it was
definitely determined that there was no possibility of closing the cases
on an agreement basis. Attention is directed to the fact that there
was a decrease of 21,557 or more than 50 per cent in the number of
such letters mailed, compared with the previous year.
71799—30—FI 1929
14
:
178
REPORT ON T H E FINANCES
The number of appeals filed with the Board of Tax Appeals was
5,139 covering 8,144 taxable years. During the previous year 9,908
appeals were filed covering 16,376 taxable years.
By reducing the number of 60-day letters mailed, the unit has
prevented the filing of appeals in many cases which previously would
have been considered controversial. The effect of this method of
operation is especially noticeable in the smaller number of cases
pending for hearing before the Board of Tax Appeals and the special
advisory committee.
Personnel.—During the year there was a decrease of 327 in the
personnel employed by the unit—66 in the Washington office and
261 in the field. On June 30,1928, the technical force of the Washington office numbered 940 and the clerical force 1,340, while on June
,30, 1929, there were 900 technical and 1,314 clerical employees, a
total of 2,214 on the rolls. There were 2,861 technical employees
in the field force on June 30, 1928, and 779 clerical employees, while
on June 30, 1929, the technical employees numbered 2,630, and the
clerical employees 749.
Special advisory committee
The special advisory committee w^as created July 28, 1927, primarily to consider and act upon, with the approval of the commissioner, cases pending on appeal before the Board of Tax Appeals as a
result of the mailing of deficiency letters. The order creating the
committee covers the following classes of cases: (a) Cases pending in
the bureau on which the advice of the commissioner is desired as to
questions of bureau policy; (b) cases arising out of the mailing of
.deficiency letters as prescribed by the revenue act of 1926; (c) cases,
not falling in (a) and (b) above, submitted to it by the office of the
commissioner.
The committee is comprised of a chairman, one general assistant,
12 members, conferees, auditors, and other required personnel. There
have also been assigned throughout the country 38 revenue agent
conferees as representatives of the committee in the offices of the
internal revenue agents in charge. These conferees have been on
detail with the committee in Washington for periods of 60 days for
training.
During the period of its existence the committee has had submitted
to it 19,101 cases involving 32,100 taxable years. Of this number
the committee took jurisdiction and considered to a conclusion
15,571 cases involving 25,560 taxable years, reaching an agreement or
eliminating the necessity of filing an appeal or litigating 9,733 cases.
The remainder, or 5,838 cases, were recommended for defense, no
basis of settlement having been reached.
SECRETARY OF THE TREASURY
179
Statistics show that the board to date has sustained the bureau to
the extent of S5 per cent of total deficiencies involved in cases recommended for defense by the committee; of the 15 per cent of total
deficiencies not affirmed by the board, it is found in part that the
board's decision covers issues which have not been acquiesced in by
the commissioner on prior cases and issues raised before the board but
not raised before the committee.
Miscellaneous Tax Unit
The Miscellaneous Tax Unit is charged with the administration of
all taxes other than income taxes. The unit is composed of three
•divisions, namely, estate tax division, miscellaneous division, and
tobacco division, and an appeals and review section, which is attached
to the office of the deputy commissioner in charge. The personnel of
the unit was reduced during the year, but a corresponding reduction
in pay roll is not shown, due to increases under the Welch bill. The
reduction in the miscellaneous division was due to the gradual completion of work in connection with repealed taxes, while that in the
•estate tax field force was due not only to the increase of the specific
exemption of estates from $50,000 to $100,000 as provided in the
revenue act of 1926, but also to more efficient methods employed in
the field work by vxay of the elimination of unnecessary details in the
.investigation of cases and preparation of reports.
' Estate taxes.—Estate tax collections amounted to $61,897,141.48
compared with $60,087,233.97 for 1928. The anticipated decrease
in estate tax collections as additional States absorbed the full 80 per
cent credit allowable under the law was offset by an increase in taxable estates for the year, an increase in values of gross estates gen^erally, and the discharge of a great percentage of back taxes through
stipulation and final agreement. The four States showing the largest
-estate tax collections were. New York, $14,380,929.26; Pennsylvania,
$8,959,403.85; California, $6,073,975.77; and Florida, $5,129,551.11.
. There were filed during the year 9,719 estate tax returns shewing
tax of $26,161,918.60, compared with 9,373 returns showing tax of
:$22,124,963.86 in 1928. Each new estate tax return is investigated
-as promptly in the field as conditions permit. The estate tax field
force, operating under the direction of the deputy commissioner
through internal revenue agents in charge, with an 8 per cent
reduction in personnel, submitted 9,482 estate tax major reports
•during the year, compared with 10,540 such reports in 1928. At the
close of the year there were 3,501 returns awaiting investigation in
the field. The number of returns audited during the year was
12,970, compared with 11,328 in 1928. Tentative deficiency estate
taxes determined in these cases amounted to $49,673,076.95. There
were 1,467 cases awaiting audit at the close of the fiscal year.
180
REPORT ON T H E FINANCES
In respect to deficiency tax determinations as a result of field
investigation and office audit, there were 162 protest letters pending
at the beginning of the year and 1,744 were received. There were
1,826 such letters disposed of involving $55,905,532.91, of which
$37,918,397,77 was rejected and $17,9^7,135.14 was allowed, leaving
80 letters on hand at the close of the year. Deficiency estate taxes
assessed amounted to $20,802,610.78.
The number of refund claims on hand July 1, 1928, was 203,
involving $8,510,231.92. There were received during the year r,516
refund claims, involving $33,869,988.68. The number of refund
claims allowed was 664, amounting to $14,337,876.28, including
$818,540.22 interest and $980,550.47 allowed in 883 cases as overassessments without claims. The number of refund claims rejected
was 695, involving $16,197,647.91. There were 360 refund claims,
involving $13,643,787.10, on hand June 30, 1929.
There w^ere 42 abatement claims on hand July 1, 1928, involving
$32,105.23; and during the year 1,290 were received, involving
$9,129,202.18. The number of abatement claims allowed was 1,133,
amounting to $11,544,318.07, including $3,398,042.42 allowed in 343
cases as overassessments without claims; and the number rejected
was 14, involving $24,618.15, leaving 185 abatement claims, involving $990,413.61, on hand at the close of the fiscal year.
There were 53 claims for refund of gift tax on hand July 1, 1928,
involving $530,387.32, and the number received during the year was
210, involving $1,987,506.73. The number of such claims allowed
was 193, amounting to $2,237,311.03, including $380,810.63 interest
and $29,127.51 allowed in 17 cases as overassessments avithout
claims; and the number rejected was 39. involving $384,760.42.
The number of claims for refund of gift tax on hand June 30, 1929,
was 31, involving $305,760.74. There were received during the year
4 claims for abatement of the gift tax, amounting to $551.86, all of
which were allowed, together with $5,829.45 allowed in 3 cases as
overassessments without claims.
The files on June 30, 1929, contained 163,693 estate tax cases and
2,615 gift, tax cases.
Miscellaneous taxes.-—Total collections of taxes under the administration of the miscellaneous division amounted to $110,175,145.39
for the year compared with $156,962,939.05 for 1928. Miscellaneous
stamp and special tax collections amounted to $67,796,924.81, an
increase of $15,535,250.20. This increase was mainly due to the
collections of taxes on transfers of stock, amounting to $37,395,927.33,
a gain of $13,387,389.65 compared with the previous year. The
record-breaking stock market activity during the year was responsible
for this increase. Taxes amounting to $17,868,372.17 w^ere collected
on bonds of indebtedness, issue of capital stock, etc., and $5,375,804.20
SECRETARY OF T H E TREASURY
181
on playing cards, increases of $2,306,912.61, and $365,091.80, respectively, compared with the previous year. The tax collected on
sales of produce for future delivery amounted to $3,333,427.14, a
decrease of $715,071.46 compared with 1928. Oleomargarine special
and stamp taxes amounted to $3,611,153.44 compared with $3,407,599.94 for 1928, an increase of approximately 6 per cent. A total of
$12,240.53 stamp and special taxes was collected on adulterated
butter, renovated butter, mixed flour, and filled cheese compared with
$15,102.96 from the same sources during the previous year. The tax
on dues amounted to $11,245,254.65, an increase of $892,264.82
compared with 1928. The increase in the tax on dues is attributed
to growth in the number of clubs and in club memberships, also to
certain provisions in the 1928 law defining dues and initiation fees,
the increased collections from these sources more than oft'setting
decreases due to the increased exemptions in the 1928 act. The tax
collected on admissions amounted to $6,083,055.82, a decrease of
$11,641,896.26 compared with 1928, which is due to modification in
the revenue act of 1928, which increased exemptions. Taxes on
pistols and revolvers amounted to $165,684.14, compared with
$169,057.01 in 1928. Collections of taxes on automobiles, etc.,
amounted to $5,545,865.90, and of capital stock tax to $5,956,295.57,
decreases of $46,082,400.06 and $2,732,206.82, respectively, compared with the previous year. Collections from distilled spirits,
fermented liquor, and narcotic taxes for the year amounted to
$13,382,064.50, a decrease of $2,616,164.36 compared with 1928.
There were 16,894 claims received or reopened during the fiscal
year compared with 24,921 received or reopened during 1928. There
were 21,742 claims adjusted compared with 28,809 adjusted, during
1928, leaving 1,129 on hand June 30, 1929, compared with 5,977 on
hand at the close of the previous year.
During the year there was allowed $1,033,885.65 as interest accrued
on taxes refunded compared with $613,528.97 allowed during 1928.
A total of $183,616,777.91, representing 197,743 items, was approved
by the commissioner on miscellaneous assessment lists, which embrace
assessments of all taxes administered by this unit. These lists carried
$31,236,497.77, representing 13,885 additional assessments resulting
from office audit and field investigations. The amount of interest
paid and assessed on the miscellaneous tax lists totaled $3,560,827.01.
On July 1, 1928, there were on hand 4,275 offers in compromise,
amounting to $495,734.42, which had been submitted in settlement of
liabilities incurred in connection with, sales, tobacco, capital stock,
estate, gift, spirits, narcotics, and miscellaneous stamp and special
taxes. There were 20,735 off'ers received during the year aggregating
$1,533,392.27. Of these 25,010 offers involving $2,029,126.69 to be
accounted for, 20,822 amounting to $1,233,895,63 were accepted; 786
182
REPORT ON TPIE FINANCES
involving $142,789.06 were rejected, and 12 in the amount of $200
were withdrawn, making a total of 21,620 amounting to $1,376,884.69
disposed of during the year. The number of offers on hand awaiting
additional evidence and consideration at the close of the year was
3,390 aggregating $652,242.
Tobacco taxes.—Collections from tobacco taxes continue their steady
upward trend, amounting to $434,444,543.21 for the year, a new high
level. The total collections show an increase of $37,994,502.18, or
9.58 per cent, compared with 1928; they represent more than 71 per
cent of the miscellaneous internal revenue in the fiscal year 1929 and
exceed total internal revenue receipts from all sources for any year
prior to 1916. Collections from taxes on small cigarettes established
another record, amounting to $341,951,551.22, which is 78.71 per cent
of the total tobacco taxes collected and an increase of $40,198,962.88,
or 13.32 per cent, compared with the previous year. An increase of
$55,715.71 is recorded in the collection of taxes on cigarette papers
and tubes which amounted to $1,179,525.53 for the 3^ear. The taxes
collected on chewing and smoking tobacco during the year declined
from $62,774,542.43 in 1928 to $61,159,178.09 in 1929. The tax collected on snuff amounted to $7,126,908.99, a decrease of $334,445.91
compared with 1928. Collections from the taxes on large cigars for
the year amounted to $22,548,567.59, a decrease of $330,807,34 compared with 1928.
North Carolina led all States in the collection of tobacco taxes with
receipts of $233,915,029.11, or 53.84 per cent of the total collections.
Virginia came next with $66,965,129.45, or 15.41 per cent, followed by
New York, with $29,077,001.52; New Jersey, $22,164,027.18; Pennsylvania, $14,464,268.40; California, $13,097,225.73; and Ohio, $11,761,319.42. A total of $391,444,000.81, or 90.09 per cent, of the total
collections of tobacco taxes for the year, was collected in the States
named.
Appeals and review section.—The appeals and review, section holds
hearings in ciases arising under the various tax laws administered by
this unit, renders on request from the heads of divisions opinions on
law questions arising in connection with the administration of such
tax laws, and reviews the action taken by the divisions on all claims
for refund or abatement allowed for amounts in excess of $500. The
majority of the hearings are held in connection with estate taxes, but
a large number involve the various excise taxes, such as documentary
stamp, sales, and taxes on admissions and dues, etc. During the
year 433 hearings were held and 528 formal opinions .prepared on
cases in which hearings had been held or on which formal opinion
had been requested by heads of divisions. There were reviewed by
this section during the year 3,238 claims for refund and abatement
and estate and gift tax cases resulting in certificates of overassessment.
SECRETARY OF THE TREASURY
183
At the close of the year there were 41 cases awaiting hearings
scheduled for future dates; 18 cases in the hands of members of thissection, awaiting further evidence from the taxpayer; 6 cases in the
hands of members awaiting supplemental reports from the field; 12
cases under consideration for which all evidence had been submitted;,
also 7 cases finally acted upon by this section but awaiting attention
of the valuation section of the estate tax division.
Accounts and collections unit
The accounts and collections unit, which is charged with the administration of matters involving 64 collection districts, is divided intothree divisions—the collection accounting division; the collectors'
personnel, equipment, and space division; and the disbursement
accounting division.
Collection accounting division.—The collection accounting division
is charged with the following duties: The construction of accounting
systems for use ia collectors' offices; the preparation of instructions
to collectors of internal revenue on office and field activities; the preparation of the procedure for the intensive audit of the smaller individual returns on Form 1040-^A and a number of the larger individual
returns on Form 1040; the auditing of collectors' revenue accounts
current and collectors' special deposit accounts current for offers in
compromise, surplus proceeds in distraint sales and sums offered for
the purchase of real estate; the issuing of internal revenue stamps;,
and the compiling of statistics for officials of the Treasury Department
and the public. The collection accounting division also is charged
with the duty of preparing, in conjunction with the Income Tax Unit,
the procedure for the preliminary examination in collectors' offices of
about 2,200,000 corporation and individual income tax returns. T h e
activities of the field force of supervisiors of accounts and collections
and the force of internal revenue agents on sales and miscellaneoustaxes are controlled and directed by this division under the general
supervision of the deputy commissioner.
During the fiscal year 1929 the policy of calling on collectors of
internal revenue for assistance in auditing the larger individual
income tax returns was continued. Of the individual income tax
returns for 1926 filed during the year 1927, there were assigned tocollectors for audit approximately 217,000. Most of the work on
these returns was done during the fiscal year 1928. However, only
44 collectors' offices were selected to give the intensive audit to the
larger individual returns. . This policy having proved helpful in thebureau's program of bringing its work to a current basis, 56 collectors'
offices were selected to give an intensive audit to the larger individual
returns filed for the taxable year 1927. Approximately 256,000 returnson Form 1040 for the year 1927 filed in 1928 were assigned to the 56
184
REPORT ON T H E FINANCES
collectors' offices for audit. These returns were practically all
cleared from the collectors' offices by June 30, 1929, only 1,721 cases
remaining on hand.
Under the provisions of mimeograph No. 3704, dated February 8,
1929, the returns on Form 1040 to be hereafter assigned to collectors
for audit will consist of those disclosing gross income of $25,000 or
less, with the exception of those showing income frem natural resources and those reporting income from partnerships or fiduciaries.
During the year the supervisors of accounts and collections submitted 110 reports covering their examinations of the accounts of the
various collectors' offices compared with 109 reports submitted
during the fiscal year 1928. Every collector's office was examined
;at least once and most of them twice during the year. The supervisors installed one new collector and one acting collector, and made^
three transfers of collectors' offices under renewal bonds.
After having taken the necessary administrative action in conmection therewith, collectors of internal revenue transmitted to the
Ibureau or otherwise disposed of 135,408 claims compared with 156,341
during the fiscal year 1929, a reduction of 20,933. The number of
claims on hand at the close of the fiscal year 1929 was 928, compared
with 1,337 at the close of the previous fiscal year. There were filed in
collectors' offices during the fiscal year 5,818,901 tax returns, compared with 5,900,465 for the previous fiscal year, a reduction of 81,564,
Of the total for 1929, 5,199,916 were income tax returns compared
with 5,229,652 income tax returns filed during the previous fiscal
year, a reduction in this class of returns of 29,736.
A total of 8,587,114,720 stamps, valued at $523,786,177.88, was
Issued to collectors of internal revenue and the Postmaster General
•compared with 7,813,530,878 stamps, valued at $458,899,806.56,
issued during the fiscal year 1928. The increase in the number of
•stamps and the value occurred principally in the issue of cigarette
"Stamps and stock transfer stamps.
Internal revenue stamps returned by collectors of internal revenue
:and by the Postmaster General and credited in their accounts
amounted to $2,848,738.90, compared with $13,234,670.94 for the
iiscal year 1928. The returned stamps were of various kinds and
denominations, including partly used books and stamps for which
there was no sale.
During the year a total of 63,418 warrants for distraint were served
by deputy collectors of internal revenue, which resulted in the collection of $36,562,221. An average of 1,648 deputy collectors made a
total of 246,702 revenue producing investigations, including the serving of warrants for distraint. The total amount collected and reported
for assessment by field deputy collectors during the fiscal year was
$63,063,230. The average number of inyestigations made per deputy
SECRETARY OP THE TREASURY
185»
and the average amount of tax collected and reported for assessment
were 144 and $37,884, respectively.
. The special force of internal revenue agents working under the direction of the accounts and collections unit collected and reported for
assessment during the year $3,916,833, an average of $361,548 per
agent. This is the highest average ever made by the revenue agents
assigned to the accounts and collections unit.
During the year 183,754 income tax returns were investigated'
and 4,698,357 information returns on Form 1099 were verified. Atthe close of business June 30, 1929, there were outstanding in the 64
collection districts for field investigation only 1,731 income tax r e turns for 1927 and prior years and 3,993 for 1928, a total of 5,724,,
compared with a total of 10,654 as of June 30, 1928. On June 30,,
1929, there were 12,781 warrants in the hands of the collectors' field
forces for collection compared with 20,097 as of June 30, 1928.
The special efforts of collectors of internal revenue to discover
delinquent taxpayers have been continued with considerable profitto the Government. The tax collected and reported for assessment astheresultpf these investigations during the fiscal year 1929 amounted
to $9,380,046.
Collectors^ personnel, equipment, and space division.—The division?
of collectors' personnel, equipment, and space is charged with theconsideration and granting of allowances to collection districts covering the employment of personnel and miscellaneous operating ex-penses, and the keeping of adequate records thereof. The divisioni
passes upon collectors' requisitions for nonexpendable supplies,,
mechanical equipment, and office furniture, and also manages the
procurement of space for collectors' offices and branch offices.
At the beginning of the fiscal year 1929 there was in the internal"
revenue collections service a total authorized force, including col-lectors, of 5,131 employees, at an annual salary rate of $10,689,460,..
which includes increases amounting to $572,700 under the Welchbill and section 713 of the revenue act of 1928. At the close of the
fiscal year there was a total authorized force, including collectors, of
5,059 employees, at an annual salary rate of $10,645,480, a net
reduction during the year of 72 and $43,980, respectively. The
reduction in personnel was brought about by improved methodsof procedure and by more efficient coordination of the work in the^
various collection districts. Reductions, in most instances, weremade by not filling vacancies which occurred on the regular force.
During t h e year $113,597.44 was expended for the employment of
temporary help in collectors' offices, compared with $109,473 during
the preceding fiscal year, an increase of $4,124,44, due to the fact
that an additional number of collectors' offices were given the Form.
1040 income tax returns for audit during the year, and to the necessity
£86
REPORT ON THE FINANCES
for all collectors' offices to compile additional statistical information on
income covering returns filed for the taxable year 1928.
During the year $287,951.91 was expended for the rental of quarters
for collectors' offices and branch offices, compared with $267,106.08
during the preceding year. The increase of $20,845.83 in the total
rental cost was due to the removal of the collector's office at Detroit,
Mich., to more adequate quarters.
Disbursement accounting division.—The disbursement accounting
division^is charged with the duties-of keeping the accounts in connection with expenditures from appropriations made available by the
Congress for the use of the Internal Revenue Bureau and service.
The division also is charged with the responsibility and supervision of
the administrative examination required by law of the disbursing
accounts of 101 internal revenue disbursing officers, collectors of
internal revenue, and internal revenue agents in charge, as well as
the administrative audit of miscellaneous vouchers for transportation,
-equipment, telephone service, rentals, etc., paid from internal revenue
funds by the disbursing clerk of the Treasury Department and direct
-settlements by the General Accounting Office.
The disbursement accounting division administratively examined
and recorded 1,213 monthl}'^ accounts of collectors of internal revenue
and internal revenue agents in charge, together with 49,539 supporting
vouchers, in addition to which 3,029 expense vouchers of employees
and 5,985 vouchers covering passenger and freight transportation and
miscellaneous expenses were audited and passed to the disbursing
olerk of the Treasury Department and General Accounting Office
for payment. The monthly pay rolls of the bureau were examined
and recorded currently.
General counseVs ofiice
The activities of the general counsel's office, which embrace the
whole field of Federal taxation, are divided into six divisions—appeals,
interpretative, civil, penal, review, and administrative.
Appeals division.'—The appeals division is charged with the responsibility of defending proposed assessments of deficiencies in income
and profits taxes, estate and gift taxes, before the Board of Tax
Appeals in all cases appealed to the board by taxpayers. This
responsibility includes settlement of cases by stipulation when possible
without hearings before the board as well as appearance in and defense
of all contested cases. The work of the special advisory committee
in the bureau and the review division of this office are reflected in
the number of cases closed by stipulation. After contested cases are
tried and decided by the board, the appeals division prepares and
•submits, for the approval of the general counsel and the Commissioner
of Internal Revenue, recommendations as to whether or not the com
SECRETARY OF THE TREASURY
187
missioner should acquiesce in any adverse decision of the board, or
prosecute petitions for review to the Circuit Courts of Appeals or the
Court of Appeals for the District of Columbia. Petitions for review
when approved by the general counsel and the commissioner and
authorized by the Department of Justice are prosecuted before the
courts by the appeals division in cooperation with the latter department, and petitions for review brought by taxpayers are defended
with the same cooperation; similar responsibility and procedure
obtain in all cases of, petitions for certiorari'to the Supreme Court of
the United States.
Under present working conditions the contested cases being heard
by the board, particularly before its divisions at Washington, are
confined largely to appeals which have been considered by the special
advisory committee or by the review division of this office with a
view to settlement without hearing, but in which settlements could
not be reached and defense was recommended.
The number of Board of Tax Appeals cases closed during the year
was 9,105, compared with 7,089 during the fiscal year 1928) 5,256
during 1927, 3,969 during 1926, and 1,726 during 1925. Of the total
number disposed of during the year, 6,013 were closed by stipulation
without hearings before the board, compared with 3,479 stipulated
during the previous year.
The number of new appeals filed with the board was 5,458, compared with 10,262 filed during the previous fiscal year. The number
of cases pending at the close of the year was 18,301, compared with
21,639 at the close of the fiscal year 1928.
The amount involved in appeals pending July 1, 1928, was
$697,366,559.34 and the amount involved in appeals filed from July 1,
1928, to June 30,1929, was $172,865,159.63, a total of $870,231,718.97.
The amount involved in appeals closed during the fiscal year 1929 was
$220,231,294.35, the total amount involved in appeals pending June
30, 1929, being $650,000,424.62.
During the year 1,306 appeals were dismissed for nonprosecution,
failure to pay filing fees, lack of jurisdiction, and other miscellaneous
reasons.
Thirty-four attorneys in the appeals division aided by 31 assistants
were assigned to trial work before the Board of Tax Appeals as of
June 30, 1929, and 8 additional attorneys were giving their exclusive
attention to appellate work before the Courts of Appeals.
Divisions of the Board of Tax Appeals held hearings in Chicago,
111.; Grand Rapids, Mich.; Detroit, Mich.; Portland, Oreg.; Seattle, Wash.; Boston, Mass.; Pittsburgh, Pa.; Atlanta, Ga.; Birmingham, Ala,; New Orleans, La.; Mobile, Ala.; Jacksonville, Fla.;
Kansas City, Mo.; Dallas, Tex.; St. Louis, Mo.; New York, N. Y.;
Miami, Fla.; San Francisco, Calif.; Wichita, Kans.; Tulsa, Okla,;
188
REPORT ON TPIE
FINANCES
Oklahoma City, Okla.; St. Paul, Minn.; Madison, Wis.; Milwaukee,.
Wis.; Nashville, Tenn; Louisville, Ky.; Memphis, Tenn.; Indianapohs, Ind.; New Haven, Conn.; Los Angeles, Calif,; Fort Worth,.
Tex.; Columbus, Ohio; and Cleveland, Ohio. Attorneys from this
division were assigned to represent the commissioner at all field
hearings.
Interpretative division.—The interpretative division considers questions of law arising under the several revenue acts imposing income,,
profits, estate, gift, legacy, admissions and dues, capital stock,,
tobacco, oleomargarine special stamp, telegraph. and telephone, a n d
transportation taxes. I t also considers questions of procedure in
connection with the administration of internal revenue laws, including
the preparation of the regulations under such statutes and of most of
the Treasury decisions amending these regulations. This division
also passes finally on all matters proposed for publication in t h e
Internal Revenue Bulletin.
Specific questions are submitted for opinion by other branches of
the bureau and by outside correspondents, which are answered in t h e
form of memoranda or letters. Letters, proposed mimeographs, and
memoranda, prepared elsewhere in the bureau, are submitted for
review and comment.
The following table shows the work of this division for each of the
last four fiscal years:
Jacketed cases
On hand at beginning of year
Received during year..
Disposed of during year
On hand at end of year.'
1926
236
894
813
317
1927
1928
317
316
1,625
1, 624
2,221
2,115
316
422
422
1,961
2,071
312
The average number of attorneys in the division for the year was
35, a reduction of 2 in the average personnel for the preceding year.
Taking the number of attorneys employed into consideration, there
was an increase in per capita production of about 3K per cent,
although the total number of cases disposed of during the year is
slightly less than the number disposed of during the fiscal year 1928.
Civil division.—The civil division, in cooperation with the Department of Justice and the various United States attorneys, handles all
civil internal revenue cases arising in the Federal district courts, t h e
United States Court of Claims, and the Supreme, Court of the District
of Columbia, together with a limited number of cases originating in
State courts.
While the Department of Justice and the United States attorneys
acting under its jurisdiction are charged with the responsibility for
the conduct of this litigation, they welcome and encourage the assistance of the general counsel's office in the preparation of pleadings, the
189
SECRETARY OF THE TREASURY
assembling of evidence, the preparation of briefs, and the actual trial
or argument of cases in court.
The number of civil internal revenue tax cases decided by the
Federal courts during the fiscal year 1929 was 374, Of these, 240 were
decided for the Government, 114 against the Government, and 20
partly for the Government and partly for the taxpayer.
The number of civil cases pending on July 1, 1929, was 3,776 compared with 3,642 on July 1, 1928. During the year 2,029 new civil
•cases were received and 1,895 civil cases were closed. Offers in compromise of pending suits received during the year numbered 104.
Compromise cases disposed of, including those pending at the beginning of the fiscal year, numbered 79, of which 53 were accepted and 26
rejected. The total amount of taxes claimed in these compromises
was $1,217,871.94, and $220,366.22 was accepted in lieu thereof.
The personnel of the civil division on June 30, 1929, consisted of
€5 attorneys, 26 assistants, and a clerical and stenographic force
of 63 members.
In order to bring about closer cooperation with the United States
attorneys, collectors of internal revenue, and revenue agents in the
handling of Federal tax matters, the bureau has established branch
offices of the general counsel's office in. the field. At the beginning
of the fiscal year legal representatives of the bureau, were permanently
assigned to New York, Chicago, Pittsburgh, Boston, Miami, Los
Angeles, and Seattle. During the year a branch office was established at St, Paul.
Penal division.—Cases handled by the penal division are classified
as (1) interpretative and (2) law cases. These are subdivided so that
under each classification there are {a) income tax cases and (6)
miscellaneous tax cases, the latter involving a large variety of taxes,
such as estate, gift, tobacco, admissions, and excise taxes.
The following table shows the work of the division during the last
two fiscal years:
1928
1929
Increase
over 1928
Cases p e n d i n g a t beginning of year
Cases received
679
1,219
699
1,971
20
752
Cases u n d e r c o n s i d e r a t i o n - _ .
Cases dispQsed.of.
^
1,898
1,199
2,670
1,459
772
260
Cases p e n d i n g at end of year.
512
The average number of attorneys employed during the fiscal year
1929 was 16.580 as against 17.703 for the previous fiscal year, a
decrease of 1.123. During the fiscal 3^ear 1929 an additional class of
work w^as assigned to .the penal division, namely. Board of Tax
AppenLs cases involving fraud penalties. The special effort made
190
REPORT ON THE FINANCES
during the year to dispose of the older cases has been successful, a
considerable number of these cases having now been closed. However, certain cases of this character, such. as. those in litigation, can
not finally be disposed of until the litigation ends.
Review division.—The review division on June 30, 1929, represented a consolidation of certain functions of interpretative division
II and of the review division which was established July 19, 1928, as
the successor to the review section of the appeals division, organized
May 20, 1928. Interpretative division I I was abohshed March 5,
1929, when the consolidation was efl'ected. The work of the review^
division as of June 30, 1929, consisted of two general classes, the
review of cases pendiag before the Board of Tax Appeals for the purpose of recommending settlement or defense, and the disposition of
refunds, credits, and abatements of various kinds of internal revenue
taxes.
The main purpose of the review division created July 19, 1928,
was to endeavor to settle expeditiously and without formal trials
cases pending before the Board of Tax Appeals involving primarily
questions of law, upon a basis mutuall}^ satisfactory to the taxpayer
and the Government. In cases where no settlements are eft'ected
or where only some issues are settled, the results of the consideration
of the cases in this division are made available to the trial attorneys
of the appeals division.
The number of cases on hand July 1, 1928, was 484, the number
received during the fiscal year ended June 30, 1929, was 2,642 and
the number disposed of was 1,791, leaving 1,335 cases on hand at
the end of the year. Of the cases disposed of, 71 per cent were closed
by agreement and 29 per cent recommended for defense.
During the year the division conducted 207 hearings on claims
cases and 601 hearings on settlement cases. The division prepared
239 reports, in accordance with section 710 of the revenue act of
1928, for submission to the Joint Committee on Internal Revenue
Taxation,
Administrative division.—The activities of the administrative division include the review of offers in compromise and the holding of
conferences on protested cases. The division is charged with the
supervision of the personnel, library, manuscripts, mail, and records,
and devises and inaugurates methods of office procedure, assembles
and reviews efficiency ratings, interviews applicants, and performs
other varied and miscellaneous duties pertaining to the work of the
<yeneral counsel's office.
MINT BUREAU
Institutions of the mint service
During the fiscal year 1929, 10 mint service institutions were in
operation; coinage mints at Philadelphia, San Francisco, and Denver;
assay office at New York, which makes large sales of fine gold bars;
mints at New Orleans and Carson City conducted as assay offices;
and assay offices at Boise, Helena, Seattle, and Salt Lake City.
The six last-named institutions are, in effect, bullion-purchasing
agencies for the large institutions and also serve the public by making
assays of ores and bullion. Electrolytic refineries are operated at the
New York, Denver, and San Francisco institutions.
Coinage
Domestic and foreign coinage.—The output of coins during the
fiscal year 1929 was greater than during any fiscal year since 1921.
This was due to the increased demand for one-cent pieces and to a
greater coinage for foreign governments. The total number of
domestic pieces executed was 361,650,350, foreign pieces, 46,651,000,
grand total, 408,301,350 pieces, as compared with the prior year's
252,776,335 domestic, 2,490,000 foreign, and 255,266,335 total pieces.
The total value of the year's domestic coinage was $51,659,050, consisting of $39,945,000 gold, $7,488,700 subsidiary silver, $1,438,700
nickel, and $2,786,650 bronze. Gold coins were made at the Philadelphia Mint only.
The coinage for foreign governments consisted of 25,000 gold
pieces for Costa Rica; 6,400,000 silver and 2,800,000 nickel pieces for
Venezuela; 3,060,000 silver, 25,000,000 nickel, and 2,016,000 bronze
pieces for Ecuador; 750,000 silver and 100,000 nickel pieces for
Nicaragua; 1,500,000 nickel pieces for Panama; and 5,000,000 nickel
pieces for Salvador. The Salvador coinage was made at the San
Francisco Mint; all the other foreign coinage was made at the Philadelphia Mint.
Edison medal
The Congress of the United States, by joint resolution of May
29, 1928, authorized the striking of a medal ^^Commemorative of
the achievements of Thomas A. Edison in illuminating the path
of progress through the development and application of inventions that have revolutionized civilization in the last century." The
medal was designed and modeled by J. R. Sinnock, engraver of the
191
192
REPORT ON THE FINANCES
mint, and executed in gold at the United States Mint at Philadelphia.
'On the obverse is a portrait of Mr. Edison with the name EDISON,
a symbol representing electricity, the year 1928, and the designer's
monogram. On the reverse appears a kneeling figure of Prometheus,
benefactor of mankind, represented as giving to the modern world
a new form of light, heat, and powder, symbolized by a small sun; a
-group of skyscraper buildings to represent the present age; and the
phrases, '^Medal of the Congress of the United States," and '^He
Illuminated the Path of Progress by His Inventions."
Gold and silver receipts and transfers
Gold operations.—Gold acquired by the Government at the several mint service institutions during the fiscal year 1929 totaled
$249,716,845.02. United States gold coin received by the mints for
recoinage amounted to $2,589,765.56; transfers of gold betw^eeri mint
offices totaled $251,395,967.56; the aggregate amount of gold received
by the several mint service institutions during the fiscal year 1929
was $503,702,578.14, which compares with $411,975,037.33 during
the prior year.
Silver operations.-^^eeei^ts of purchased silver during the fiscal
year 1929 totaled 2,469,942,50 fine ounces, the average cost of which
was 57.51 cents per ounce, total cost being $1,420,504.81. Of this
amount of 2,469,942.50 fine ounces, a total of 1,509,435.98 was silver
•contained in gold deposits. Silver received in exchange for bars bearing the Government stamp totaled 1,401,825.65 fine ounces; United
States silver coin received for recoinage totaled 2,524,217.27 fine
ounces, the recoinage value being $3,489,500.29; silver deposited in
trust by other governments totaled 1,433,334,62 fine ounces; and
transfers between mint service offices totaled 1,636,070,32 fine ounces,
making the aggregate quantity of silver received by the several mint
service offices during the fiscal year 9,465,390,36 fine ounces, as compared with 10,365,087,92 ounces during the prior year.
The New York market price of silver during the fiscal year 1929
averaged $0.57045; the lowest price was $0.51625 on June 4, 1929,
and the highest price $0.59875 on July 27, 1928.
Refineries
The mint service refineries that are operated at New York, Denver,
and San Francisco produced 2,869,216 fine ounces (98.37 tons) of
electrolytically refined gold during the past fiscal year, which compares with 82.16 tons in the prior year; and 3,310,257 fine ounces
(113,5 tons) of electrolytically refined silver, which compares with
108.1 tons during the prior year.
The stock of gold and silver in unrefined bullion on hand was reduced during the past year by about 19 tons to 412 tons, as compared
SECRETARY OF T H E TREASURY
193
with the prior year's reduction of about 6 tons. The Denver riefinery
operated only during the last half of the fiscal year.
Additions and improvements
At the Philadelphia Mint the high-pressure steam plant, which
generated the electric power used at the mint and which had been in
use ever since the building was completed in 1901, was shut down
February 10, 1929, and replaced with two electric generating sets of
300 kilowatts each. Power purchased from the local power company
is delivered at 2,300 volts, alternating current, and converted to 220
volts, direct current. Current for lighting purposes is converted to
220 volts, alternating current, through transformers. A material
saving in power costs over the steam-generating plant has been shown,
due mainly to reduction of labor force and decreased consumption of
coal. A contract has been let for a 75-kilowatt generator which will
shortly be installed; this smaller set will be used to generate power
for elevators, and to produce power required when the plant is only
partially operated. It wiU also be used in connection with one of
the larger sets when the load is heavy for one and not sufficient to
warrant the operation of the two larger sets.
A new compressor used in connection with lacquering medals has
been installed in the medal room, as well as an improved drying
cabinet. These improvements have made for better finishes on
medals and for 50 to 75 per cent saving over the time required to do
similar work prior to making the new installations. The use of
chromium-plated coinage dies and collars, initiated during the prior
fiscal year, on the pure nickel coinage undertaken for the Government
of Ecuador, permitted execution of this coinage with a minimum
amount of difficulty, although the average life of dies used was shorter
than in stamping cupro-nickel. The blanks or discs for this coinage
were purchased^ready for stamping, the mint being without facilities
for properly working pure nickel, a very refractory metal.
At the San Francisco Mint a new vault has been installed, of the
double deck, compartment type, with 13 compartments on each of
the two floors. It is 50 feet by 23 feet 8 inches, by 16 feet 10 inches
high, inside, with approximately 12,000 cubic feet of storage space in
the compartments. Most of the compartments are 9 feet 3 inches
by 6 feet 7 inches, and either Sji feet or 7}^ feet high. The floors are
served by a push-button controlled elevator, and a ventilating system serves each compartment.
Six improved oil-burning crucible melting furnaces with their
accessories were built and installed in the old electric furnace room
and will be placed in operation in the near future.
The following apparatus has been installed in the refinery: A 2compartment hood built of IK inch thick ^^Transite" board, and
71799—30—FI1929
15
l94
REPORT O N - T H E FINANCES
table of 3-inch thick reinforced concrete, in the silver nitrate room,
taking the place of a badly damaged ''Alberene" stone hood which
had been in service for 20 years. Better ventilation of this room has
been provided.
. A gas fired assay muffle furnace has been placed in the laboratory,
and two electric driven fuel oil pumps for use in connection with the
melting furnaces.
An oil-fired cupel furnace, having a capacity of approximately
3,000 ounces of silver, is under construction.
At the Denver Mint a' structural steel hood is being erected over
the refinery melting. furnaces to convey dust, fumes, and gases, to
settling chambers and flues, for the recovery of their metallic values:
A gas dryer has been erected to drive off moisture contained in
materials and products from regular and dieah-up operations,, resulting in much saving of labor and time. A number of safety "devices
have been installed.
Gold and silver in the UnitedStates
Stock of coin and monetary buUion in the United States.—On June
30, 1929, the estimated stock of domestic coin in the United States
was $2,372,677,257, of which $1,407,888,924 was gold, $539,960,849
standard silver dollars, $304,.187,449 subsidiary silver coin,, and
$120,640,035 minor coin.
;. The stock of gold bullion in the mints, assay offices, and Federal
reserve banks on the same date was valued at $2,916,461,936, an
increase during the year of $136,288,720; the stock of silver bullion
was ip,431,.829.'93 fine ounces, a decrease of 434,191.11 fine ounces. ,
Production of gold and sifoer,—Domestic gold production during
the calendar year 1928 was $46,165,400, as compared with $45,418,600
in; 1927, The output has declined to about 45 per cent of that for
the record year 1915, when the total was $101,035,700.
• Silver of domestic production during 1928 totaled 58,462,507
(Ounces, valued at $34,200,567; this compares with 60,434,441 ounces,
valued at $34,266,328, for'1927, and with the record production of
1915, 74,96r,075.fine ounces, valued at $37,397,300, '
• ' .:
: Industrial consumption of gold and silver.—Gold consumption in
the industrial arts during the calendar year 1928 is estimated at
$59,080,659, of which $31,569;500 was new material.
Silver used in the arts is estimated at 35,547,663 fine ounces, of
which 24,931,283 fiiie ounces was new material.
As compared with the prior year, silver consumption was about
3,100,000 ounces less, a n d ' gold consumption decreased about
;E238,000. .
195
SECRETARY OF THE TREASURY
Net import and export of domestic gold coin.—The net import of
domestic gold coin during the fiscal year 1929, was $45,065,099; during the prior fiscal year there was net export of $218,739,072. During the 15 fiscal years 1915-1929, since the opening of the World War,
there has been a net export of $1,114,893,152. Since 1870 the net
export of domestic gold coin has been $1,992,542,216.
Appropriations, expenses, and income
Appropriations available for mint service during the fiscal year
1929 totaled $1,709,463, and reimbursements to appropriations for
services rendered amounted to $138,360,29, making a total of
11,847,823.29.
Expenses amounted to $1,757,855.44, of which $1,694,473.88 was
chargeable to appropriations and $63,381 56 chargeable to income.
A single appropriation was provided by the Congress for the 1930
expenses of the 10 mints and assay offices, in lieu of 4 appropriations
for the fiscal year 1929, 20 appropriations for each of several prior
years, and 30 annual appropriations theretofore. This adds to
administrative flexibility and reduces accounting work.
The income realized by the Treasury from the mint service aggregated $5,721,339.06, of which $5,102,765,79 was seigniorage. The
seigniorage on subsidiary silver coin was $1,561,296,35; on nickel
coin, $1,103,279.68; and on bronze coin, $2,438,189,76,
Summary of appropriations, expenses, and balances, fiscal year 1929
Items
Appropriations
Earnings credited to appropriations.
Total available
Expenses
Unexpended balances
Salaries
and
wages
TransportaContingent tion of bulexpenses
lion and
com
Total
$1,391,440.00 $289, 300. 00 $28, 723.00 $1, 709,463.00
97,330. 68
41,029.61
138, 360. 29
1,488, 770. 68
1,408,487.71
330, 329. 61
261,590.98
28, 723. 00
24, 395.19
1,847,823. 29
1,694,473.88
80,282. 97
68, 738. 63
4, 327. 81
153,349. 41
196
REPORT ON T H E FINANCES
Deposits of gold and silver, income, expenses, and employees, by institutions, fiscalyear 1929
The number and value of deposits, transfers, gross income, and
expenses for the fiscal year 1929, and the number of employees on
June 30, 1929, at each institution, are shown in the following table:
Institutions
Num- Number
value
of de- ; ber
mint Coining
of gold and
posits ofservice
of gold trans- silver received ,
and
fers
silver
Gross
income
10,408 40,131 $260,008,888.76 $3,238,997.60
Philadelphia
944 33.113,566.16 , 1,238,315.76
6,566
San Francisco
134 15,919,145.50
944,318.41'
2,434
Denver
632 193,617,695.27
297,938.89
New York
14,710
737.06
2,158,212.01
434
New Orleans
419.31
179,870.74
186
Carson City
1,281.06
328,051.66
228
Boise
667.33
232,467.96
179
Helena. . .
1,770.11
6,966,588.07
1,262
Seattle
623.49
19,958.83
64
Salt Lake C i t y . . . .
36,461 41,841
Total.
Mint" Bureau
Grand total.. 36,461 41,841
Fiscal year 1928
43,133
37,415
Gross
expense
Excess of
Income (-f)
or of
expenses ( - )
$793, 508.29 -1-$2,445,489.21
-1^944,582.83
293,732.93,
+729,162.76
215,155.65
-50,641.20,
348,580.09
-13,930.13
14,667.19 •
6,156.46
-5,737.15
7,886.59
-6,605.53
6,773.89
-6,206. 56
28,078.25
-26,308.14
-3,923.94:
4,447.43.
Em
ploy,
ees,
June
30,
1929
299
117
79
120
• 7
3
4
3
11
2
512,644,444.96
5,724,868.92
1,718,986,77
42,398,63
+4,005,882.15
-42,398.53
645
14
612,644,444.96
6,724,868.92
1,761,385.30
+3,963,483.62
660
6,408,493.98' 1,682,260.46
+4,726,233.62
687
423,732,406.10
PERSONNEL CLASSIFICATION OFFICER
Appeals and classification sheets
The activities of the personnel classification officer during the
fiscal year 1929 are summarized as follows:
Number
Number of perof appeals sons involved
..
.
Total to be disposed of.
Approved:
1928
1929
Disapproved:
1928
1929
Cancelled:
1928
1929
Total acted on—
1928
1929
Carried over to fiscal year 1930:
1928...1929
661
260
Carried over from fiscal year 1928
Presented' during -fiscal year 1929;
Individual
Group
..
-
1
'
-
346
346
26 372 344
690
632
1 351
92
60
152
176
546
138 314 229
775
70
58 128
12
3 15
21
3
?4
659
258
199 457 292
951
2
173 175
400
2
398
A number of appeals were made following reorganization, partic
ularly in the Bureau of Internal Revenue. An appreciable number
represented re-appeals on the part of various groups who felt that
their jobs had not been properly allocated.
Upward of 3,500 classification sheets were handled through the
chief clerk's office during the year. These classification sheets covered
reorganization, reassignment of duties, realignment of grades, new
appointments, transfers, cases requiring better description of duties,
and cases where new positions were being set up. In many cases
only a cursory examination was necessary. Many of them, however,
required special investigation to determine the merits of the case.
197
.198
REPORT ON THE FINANCES
Efiiciency ratings
In line with general instructions asassued by the Personnel Classification Board in the matter of maintaining an average per cent in
efficiency for groups of workers, the average for the entire department
for the period ended May 15, 1929, was 88.10 per cent, a slight reduction from the average rating for the previous year.
It has been found impracticable to adhere to a mathematical
average for all groups of workers, especially where the group is small,
and in many instances composed of selected employees. For the
guidance of the various administrative heads, the department suggested an average of 87 per cent. Oiit of 24 Treasury activities
17 submitted efficiency ratuigs with an average below 88 per cent
and 7 submitted ratings slightly in advance of 88 per cent. The
lowest average was 85.30 per cent for a group of 1,267 workers.
The policy of promoting those furthest removed from the eligible
salary according to the most recent efficiency rating was continued
in effect with certain modifications looking to a stricter compliance
with the policy.
BUREAU OF PROHIBITION
Organization and procedure
, During the year the Bureau of Prohibition completed the organization of offices of administrators and deputy administrators. Under
the supervision of bureau representatives all the local offices have
now been set up to operate w:ith maximum efficiency. The clerical
and executive operations are practically all prescribed and limited to
essentials. The necessity for extensive'attention of the bureau to
permit matters has lessened by reason of better control of alcohol
production and distribution; and the work of the bureau and its local
officers to a constantly greater extent is directed to the discovery,
and prosecution of violators of the prohibition statutes.
The revised official prescription used by doctors for prescribing
medicinal liquor has proved to be successful. Druggists were relieved
of the detailed record work formerly required, with no additional
requirements placed on physicians. The new prescriptions are
written in duphcate, one copy being retained by the druggist, the
other copy being sent to the prohibition administrator. These
prescriptions are practically impossible to counterfeit.
During the year the work of the school of instruction was amphfied
and broadened by carrying.the school direct to the agents in the field.
Two lecturers and instructors visited practically every administrative
district in the United States and gave instruction at 22 different places.
The period of instruction was from three to five days at each place
with six hours of instructions and lectures each day. About 750
agents, mostly new recruits, attended these lectures and did the
written test work in connection therewith. These lectures and tests
are intensely practical, and a marked improvement in the general conduct and morale of the men has resulted from them. Untrained
men.are no longer sent out with general instruction to ^'enforce the
law." All agents have had specific instructions regarding the rights
of citizens as guaranteed by the fourth and fifth amendments to the
Constitution, the proper method of securing search warrants and
executing them, the technique of making an investigation of larger
and more"important cases, and the proper form of writing a report.
These instructions are being continued and it is our intention that
every recruit will have the benefit of them before he is required to go
on duty in making investigations.
199
200
REPORT ON THE FINANCES
Activities
Prohibition agents made 66,878 arrests during the fiscal year 1929
and seized 7,299 automobiles valued at $2,879,012.86 and boats
valued at $260,845. As the result of the work of such agents, prohibition cases against 75,308 individuals were terminated in Federal
courts, resulting in 56,546 convictions, of which number 19,074
were given jail sentences. The courts imposed sentences aggregating 7,443 years and fines amounting to $7,363,492,22. In addition
to these sentences, the courts suspended, paroled, and probated sentences amounting to 5,053 years and $367,774.90.
Federal prohibition agents also made the arrests or assisted in
obtaining the evidence in a large number of cases against individuals
prosecuted in State coui^ts.
The efforts of the field division during the last fiscal year have
resulted in the conviction and sentence to the penitentiary of a
number of city and county enforcement officers on charges growing
out of their protection of violators of the law. This quite naturally
has had a salutary effect upon such officers and has been of much
value in stamping out the organized collusion of local officers with
bootleggers.
During the last quarter of the fiscal year a number of agents have
been detailed to the Detroit area for the purpose of stopping the importation of intoxicating liquors from Canada into the United States
by way of the Great Lakes. Much progress has been made in this
connection. The agents so detailed function under the general supervision of an officer of the Bureau of Customs, who has been designated as coordinator. This coordinating activity, as well as that
established on the Pacific coast, in cooperation with the division of
foreign control, has been highly successful in the suppression of
smuggling.
During the year 737 applications for pardon for persons serving
sentences for violation of the national prohibition act and the narcotic
laws were considered, and recommendations made thereon to the
Department of Justice; 4,261 applications for parole were passed upon.
The technical division conducts the chemical work of the Bureau of
Prohibition, as well as work of this character for the Bureau of
Internal Eevenue in Washington. It supervises generally the
activities of the chemical laboratories of the Bureau of Prohibition
in the field. It also has supervision of work relating to the provisions
of Title III of the national prohibition act and of regulations issued
pursuant thereto, and conducts work relating to the permissive use
of intoxicating liquors under Title II of the national prohibition act.
The modification of the formulae for specially denatured alcohol,
which is of great importance to both industry and the enforcement
SECRETARY OF T H E TREASURY
201
of the national prohibition act, is being studied continuously in the
Washington laboratory. Substantial and important results have
already been secured in eliminating weaker formulae from certain lines
of industry, thus reducing diversion and assisting the legitimate
industry to secure denatured alcohol better adapted to its needs.
Research work is being continued in the Washington laboratory with a
hope of further strengthening the specially denatured alcohol formulae
with the view not only of safeguarding the alcohol but also of
making these formulae more adaptable for use in the arts and industries. There are at present only two completely denatured alcohol formulae authorized and the reports received from the field officers
throughout the fiscal year indicate that, on account of the difficulty
of manipulation so that potable alcohol can be produced, these
formulae are not being fraudulently used. Completely ,denatured
alcohol several years ago was a source of considerable illicit liquor,
but the diversion of this kind of alcohol for beverage purposes has
practically ceased and is no longer a problem. The continued policy
of withdrawing certain specially denatured alcohol formulae and the
substitution of others for use in certain lines of industry has continued
to benefit the industries involved and has substantially reduced diversion to illegal purposes.
The policy of limiting the production of industrial alcohol to the
actual need of legitimate industry initiated January 1, 1928, has
proven to be successful. Each industrial alcohol plant is allotted a
fixed quota of the total alcohol to be produced, with a provision that
only 40 per cent of its total quota for the year could be produced
during the first six months of the calendar year, provided that legitimate industries do not require an excess of that quantity. This,
program during the past fiscal year has been of great benefit to the
alcohol industry and the trade by preventing an overproduction of
alcohol and thus avoiding unstable conditions in the trade in regard
to its raw material. This policy has also been a factor in greatly
reducing the diversion of industrial alcohol for illegal purposes,
because there has been a legitimate market for all the alcohol produced
during the past fiscal year and no large surplus was accumulated,
which is an incentive for fraud if no legitimate market exists.
There has been a substantial increase during the past fiscal year in
the quantity of completely and specially denatured alcohol manufactured, which can be readily accounted for on account of the following facts: An increase of several million automobiles registered in
the United States has required additional miUions of gallons of completely denatured alcohol for antifreeze purposes and a tremendous
quantity of specially denatured alcohol to furnish lacquers, which are
now used exclusively in finishing automobiles. There has been an
expanding market for lacquers manufactured from specially de
202
REPORT ON THE FINANCES
natured alcohol to finish furniture and the interior of residences.
The tremendous expansion of the rayon industry has required additional millions of gallons of specially denatured alcohol. The
growth and expansion during the past fiscal year of the chemical
industries has also required more alcohol, which is the basic raw
material used in thousands of preparations and processes.
During the last part of the fiscal year a temporary permit was
granted to a large chemical corporation for the experimental production of synthetic ethyl alcohol from ethylene gas on a commercial
scale. Under this permit approximately 50,000 proof gallons of
ethyl alcohol were produced and later denatured for use in one of
their chemical processes. The ethyl alcohol was sufficiently pure to
be used in practically 90 per cent of the preparations and processes
now using ethyl alcohol, produced by the fermentation of blackstrap
molasses or grain. If necessary, it could be sufficiently purified to be
used in any preparations or processes now using alcohol produced by
fermentation. The cost figures of production are not known, but
the mechanical difficulties of producing synthetic ethyl alcohol from
ethylene apparently have been solved. If the cost of production is
no greater than the fermentation processes now being used, the
quantity that can be produced is limited only by the quantity of coal
and petroleum oils available. This is probably the most interesting
development in the industrial alcohol trade that has occurred for
many years,
Durmg the fiscal year 1929 there were produced 200,832,051.08
proof gallons of alcohol, an increase of 31,682,146.25 proof gallons compared with the quantity produced during the preceding year. There
were withdrawn from warehouses on payment of tax 8,892,247.77
proof gallons of alcohol, an increase of 217,266.99 proof gallons
compared with the preceding year;.and there were withdrawn for
tax-free purposes, including withdrawals for denaturation, for export,
and for use of the United States, hospitals, laboratories, colleges, and
other educational institutions, a total of 185,650,908.41 proof gallons
of alcohol, an increase of 22,732,825.95 proof gallons compared with
the preceding year.
There were withdrawn, tax paid, from distillery, general, and special
bonded warehouses 1,616,658.1 taxable gallons of distilled spirits
(including brandy) other than alcohol, an increase of 3,860 gallons
compared with^ the preceding year.
Personnel
The past fiscal year witnessed the most marked effect of the application of the provisions of the.act of March 3, 1927, requiring that
all positions, with the exception of that of the commissioner, be filled
subject to civil service laws.
SECRETARY OF THE TREASURY
20.3
As a result of. additional examinations announced by the Civil
Service Commission at the beginning of the calendar year 1928 for
administrative positions in the field service, the bureau has been able
to fill all vacancies in the positions of administrator, assistant admin-^
istrator and deputy administrator.
In September, 1928, the Civil Service" Commission began certification of eligibles for the subordinate enforcement positions of investigator, inspector and agent, which comprise the main body of the field
personnel. Eligible lists with accompanying examination papers
were transmitted to the field offices through the bureau in Washington.
This method was adopted in preference to the usual certification by
civil service district secretaries for field positions in order to insure
careful compliance by the field offices with the detailed procedure
laid down by the commission governing the selection of such large
numbers of eligibles, but principally in order that the bureau might
exercise such control and coordination as to effect a gradual replacement of ineligible employees and to prevent any wholesale turnover
of personnel, with resultant disruption to the field organization and
breakdown in enforcement operations.
Sufficient eligibles were supplied by the commission to permit the
filling of existing vacancies in the positions of investigator and inspector and future vacancies in these positions will be fflled by the
promotion of classified employees in the service. This is not true,
however, of the agent positions, and the commission found it necessary
on December 15, 1928, to hold another examination for the position
of prohibition agent, which it is hoped will result in the procurement
of sufficient eligibles to take care of the needs of the service.
Shortly after the above lists were received, the commission formulated registers and proceeded with the certification of eligibles for the
special agents' force of the field division; for all legal positions in the
bureau, departmental and field; and for warehouse watchmen. Lists
were sufficiently large to enable the bureau to fill its quota of such
positions, although it is possible that additional- examinations may
be necessary in some field districts for certain legal grades in order to
provide a reserve of eligibles for future vacancies.
The process of bringing the entire force of the bureau within the
classified civil service, in conformity with the act of March 3, 1927,
has been steadily going forward anji has been as rapid as the proper
solution of the numerous personnel problems arising therefrom has
permitted. The successful accomplishment of this work demands the
closest cooperation between the Bureau of Prohibition and the Civil
Service Commission.
At the close of the fiscal year, there were 338 permanent and 4 temporary employees on the bureau rolls in the office at Washington, and
4,326 permanent and 31 temporary employees in the field service of
204
REPORT ON THE FINANCES
the bureau, making a total of 4,664 permanent and 35 temporary
employees on the roUs of the Bureau of Prohibition on June 30, 1929.
The personnel on June 30, 1928, consisted of 4,396 permanent and 92
temporary employees.
Narcotics
On June 30, 1929, a total of 323,982 persons were registered under
the Harrison narcotic law, as amended, 291 as importers and manufacturers, 1,751 as wholesale dealers, 51,568 as retail dealers, 146,588
as practitioners, and 123,784 as dealers in and manufacturers of
untaxed narcotic preparations, the latter number including registrants not required to pay special tax by reason of paying another tax
under the act.
At the beginning of the year, 47 cases of violations of the act of
January 17, 1914, regulating the manufacture of smoking opium,
were pending and 29 cases were reported during the year, or a total
of 76 violations. During the year 7 persons were convicted, 4
were acquitted, 10 cases were dropped, and 55 violations were pending at the close of the fiscal year.
There were 5,193 convictions under the Harrison narcotic act and
smoking opium act, for which the courts imposed sentences aggregating 11,141 years 6 months and 21 days and fines amounting to
$218,783.51. There were 1,036 cases compromised, the aggregate
amount collected being $60,179.45. During the fiscal year 1928, a
total of 8,653 cases of criminal character was reported, compared
with 9,197 such cases during the last fiscal year. Sentences for the
past year totaled 11,141 years 6 months and 21 days, whereas the
aggregate for the preceding year was only 8,786 years 4 months and
28 days. Fines imposed increased from $184,213.99 to $218,783.51.
The general situation is good with respect to the manufacture, sale
and consumption ol narcotic drugs produced from opium and coca
leaves lawfully imported into the United States. The quantity of
narcotic drugs, manufactured from crude opium and coca leaves lawfully imported into the United States and diverted to illicit channels
during the past fiscal year, is believed to be comparatively small.
Evidence indicates that of the total quantity of narcotic drugs seized
in illicit traffic only a small percentage is of domestic manufacture.
PUBLIC DEBT SERVICE
Division of Loans and Currency
This division is the active agent of the Secretary for the issue of
all public debt obligations of the United States and for conducting
transactions in such obligations after issue. It is also responsible for
the issue of bonds or other obligations of Porto Rico and the Phihppine
Islands, for which the Treasury Department acts as fiscal agent. The
division undertakes the safekeeping of public debt and insular loan
securities for certain Governmeiit offices. It also counts and delivers
to the destruction committee United States currency canceled as unfit
and mutilated paper (spoilage, etc.) received from the division of
paper custody and the Bureau of Engraving and Printing.
Issue and retirement qf securities.—The following is a summary of
the activities during the fiscal period in connection with the issue
and retirement of securities:
Registered
Nonregistered
Total
ISSUES
stock shipments to Federal reserve banks:
For exchange transactions
Allotment for original issue
Original issue by the division
Securities issued on exchange . . . .
Total securities issued and shipped
$1, 7.62,400, 750. 00
3, 984, 791, 550. 00
$1, 762, 400, 750.00
3,984,791, 550.00
I $2, 563, 036, 780. 00
407,466,805. 00
5, 747,192,300. 00
8,339,,870. 00
24,102, 300. 00
5, 747,192, 300. 00
2, 571, 376, 650. 00
431, 569,105. 00
2, 970, 503, 585. 00
5,779,634,470.00
8, 750,138, 055. 00
RETIREMENTS
Securities retired on exchange —
.. .
Securities cleared for redemption 2 _
Securities retired on other accounts (i. e.,
claims, credit, and exchange authorization
retirements)..
Total securities retired
163, 943,675. 00
3 2,829,144, 095. 00
216,530,175.00
3, 209, 617, 945. 00
267, 625,430. 00
227, 704. 25
431, 569,105.00
2, 829, 371, 799. 25
71, 520. 00
216,601,695. 00
267, 924, 654. 25
S. 477. F,i2. FtQQ. 2F,
STOCK ACTIVITIES
Securities received from Bureau of Engraving and Printing
Securities restored to stock by Federal
reserve banks
•.
Securities canceled and delivered to Register
of Treasury
1 2, 972, 285, 360. 00
2, 075, 081,150. 00
6,191,189, 720. 00
9,163,475,080. 00
57,157,350. 00
57,157, 350. 00
666, 563,300.00
2, 741,644,450. 00
1 Includes $2,379,000,000 specia Jl-day certificates of indebtedness.
Represents face value of securities redeemed. .
» Does not include $18,750 previously reported, which appear in the ofiicial public debt figures ofredemption this fiscal year. Includes $2,379,000,000 special 1-day certificates of indebtedness.
The detail of transactions in public debt securities is presented in
formal statements elsewhere in the report, but of special note are the
following data regarding new issues and retirements covering trans-
205
206
REPORT ON THE FINANCES
actions handled by the division and not including transactions
conducted by the Federal reserve banks.
New issues by the division, not including stock shipments to
Federal reserve banks, consisted of 3% per cent Treasury bonds of
1940-1943, amounting to $22,185,550, of which $21,001,700 were in
Tegistered form; 2% per cent postal savings bonds (thirty-fifth and
thirty-sixth series), amounting to $2,074,800, of which .$1,958,080
were in registered form; registered 4 per cent Treasury notes and
interun certfficates aggregating. $161,077,000, of which $127,700,000
was for the World War adjusted service certificate fund, $33,000,000
was for the civil service retirement and disability fund, and $377,000
was for the foreign service retirement and disability fund;, and
bearer certificates of indebtedness, aggregating $5,742,800, as follows:
Series TJ-1929 {02 per cent), $3,2,14,800; series TS-1929 (4% per
cent), $310,000; series TD-1929 (4)^ per cent), $214,500; series
TS2-1929 (4M per cent), $146,000; series TD2-1929 (4% per cent),
$373,500; series TM-1930 (5K per cent), $1,484,000, In addition,
original issues of the Philippine Islands and Porto Rican securities (including those of municipalities) were made in total amount of
$1,296,500.
All outstanding bonds of the third Liberty loan matured and
ceased to bear interest on September 15, 1928, and as a consequence
registered bonds to the amount of $208,522,100 were retired. From
July 1, 1928, to the date of maturity there were retired third Liberty
loan registered bonds amounting to $37,237,300 in exchange for new
issues of Treasury bonds and certfficates of indebtedness, $30,537,850
by purchases for the cumulative sinking fund and $1,275,750 by
purchases with surplus money in the Treasury. Other retirements
of third Liberty loan bonds for redemption amounted to $149,150.
Treasury savings certificates of the issues of September 30, 1922,
and December 1, 1923, matured throughout the fiscal year, necessitating a continuance of the enlarged force engaged on this work.
Total redemptions of Treasury savings certfficates in this fiscal year
amounted to $143,067,725 as against $179,411,475 in the fiscal year
1928. The last issue of Treasury savings certificates, issue of December 1, 1923, matured July 15, 1929. On August 1, 1928, the
Post Office Department ceased to collect evidence and authorize the
payment of any registered war savings certificates. Since that date
the Division of Loans and Currency has undertaken to secure necessary evidence and authorize payment by the Treasurer of all registered
as well as the irregular unregistered war savings' certificates and
stamps. This has practically doubled the activities of the division
in. this respect, evidenced by total war savings stamp. redemptions
amounting to $206,535 in this fiscal year as against, $94,595 in the
SECRETARY OF THE TREASURY
207
fiscal year 1928. Besides the foregoing, other retirements for
redemption amounted in the aggregate to $29,375,389.25.
Individual registered accounts activities.—In connection with public
debt registered issues, individual accounts are maintained and
interest is paid periodically in the form of checks.
'
The interest-bearing accounts open June 30, 1929, were as follows:
Number of
accounts
Pre-war loans
Liberty and Treasury loans
Treasury notes (i, e, special fund accounts)..
Total
'.
Principal
13,191
891,835
$748,012,200
2, 748,020,950
606,902,000
905,035
4,102,935,150
Largely due to the maturity of the third Liberty loan, the amount
of Liberty bonds. Victory notes, and Treasury bonds in registered
form, including interest-bearing and noninterest-bearing accounts,
decreased during the year from $2,996,424,050 to $2,753,909,850, a
loss of $242,514,200; and the individual accounts maintained for
these'bonds and notes decreased from 1,259,986 to 913,225, a loss of
346,761 accounts. Of the 385,472 third Liberty loan individual
registered accounts, representing $289,219,400 principal, which were
open at the beginning of the fiscal year, only 16,020 accounts for
$4,370,550 remained on June 30, 1929. Second Liberty loan accounts
were reduced during the year from 10,124 accounts for $3,721,050
to 4,672 accounts for $1,390,000 and Victory (4% per cent) loan
accounts from 1,057 accounts for $214,650 to 698 accounts for $128,350.
The discharge of ^registration in connection with both redeemed and
unredeemed loans was handled on a current basis.
There was a net gain in the principal of unmatured pre-war loans
of $2,372,460 and a gain of approximately 363 accounts. There
were closed 452,303 individual accounts for registered Liberty bonds.
Victory notes, and Treasury bonds, and 19,321 accounts were
decreased, representing the retirement of securities amounting to
$591,665,250 par value. Compared with the preceding fiscal year,
this was an increase of 6,270 in accounts closed, but a reduction of
8,781 in accounts decreased and of $306,556,650 in principal affected.
In connection with the same loans, 105,542 new accounts amounting
to $349,151,050 principal were opened, $21,001,700 of which represented the original issue of 3% per cent Treasury bonds of 1940-1943.
This was 29,965 more accounts opened, but $135,908,050 less principal acquired than in the fiscal year' 1928. Thirty-five thousand
four hundred and seventy-five changes of address for the mailing of
interest checks were made on the registered accounts during the year.
Interest on registered Liberty and Treasury bonds was paid on due
dates in the form of 1,753,959 checks, amounting to $110,783,231.90,
208
REPORT ON T H E FINANCES
which was 879,568 less in checks and $16,655,098.59 less in money
than in the preceding fiscal year. Final interest on the third Liberty
loan, due September 15, 1928, was paid by the Treasurer of the
United States at redemption and is not included in the foregoing
figures. On registered ^securities of the pre-war loans, 44,515 checks
for $15,572,671.05 were issued and interest on registered Treasury
notes of the World War adjusted service series paid by the division
was in the form of four checks aggregating $15,724,000. There were
received from the Bureau of Engraving and Printing 1,802,200 checks
as stock, and there was canceled and delivered to the destruction
committee stock consisting of 22,588 checks.
Claims—Claims for relief on account of lost, stolen, destroyed, and
mutilated securities handled by the division during the fiscal year
were as follows:
u m b e r of P a r a m o u n t of
N u m b e r of Nsecurities
claims
securities
(pieces)
Received
3,776
9,873
Settled:
B y reissue or r e d e m p t i o n of securities
B y recovery of securities . . .
B y disallowance of claims
B y other disposition ( n o t claims t r e a t m e n t ) . .
2,037
1,466
70
30
4,769
3,158
290 •'
212 1
875,961. 75
1,154,350. 00
15,345.00
1, 060. 00
3,603
8,429 •
2, 046, 716. 75
Total settled.-
$1,708,081. 50
Safe-keeping of securities.—At the beginning of the year there were
securities amounting to $600,610,300 in safe-keeping for various Government offices, against which formal audited receipts were outstanding. Throughout the year securities amounting to $184,401,750 were
received for safe-keeping and receipts therefor issued, and securities
amounting to $46,322,450 were delivered from safe-keeping upon the
surrender of outstanding receipts, leaving a balance of securities
amounting to $738,689,600 in safe-keeping June 30, 1929.'
Mutilated paper and redeemed currency.—Mutilated paper verified and
delivered to the destruction committee consisted of 21,867,870 sheets
and coupons, of which 21,455,188 sheets and coupons were received
from the Bureau of Engraving and Printing and 412,682 sheets from
the division of paper custody. Redeemed currency counted and
delivered to the destruction committee during the year amounted to
640,735,895 pieces, representing $1,918,236,064, detailed as follows:
Number of
pieces
United States notes.
Silver certificates
Gold f-ertificates
Treasury notes
Fractional currency
74, 754, 952
526, 905, 526
39, 067, 929
3,528
3,960
Face value
$301, 927, 150.
529, 462, 400
1, 086, 824, 700
20, 900
914
SECRETARY OF THE TREASURY
209.
Publicity.—The division maintains a mailing list in addition to its
hst of holders of registered securities for the purpose of placing new
public debt offerings, notices of redemption, and such matters before
the public. Approximately 2,350,000 printed circulars and 300,000
circular letters were distributed during the year by this means.
Personnel.-—There was considerable turnover in the personnel of the
division this fiscal year owing to redemption activities, although not
as great a turnover as in the preceding year. There were on the rolls
at the beginning of the year 1,148 employees. During the year there
were 217 employees appointed, 121 transferred from other bureaus,,
and 101 reinstated, while 269 employees resigned, 218 were transferred to other bureaus, 4 were retired, and 5 were dropped from the
rolls on account of death. A net decrease in force of 57 employees
thus resulted, leaving 1,091 employees on the rolls at the end of the
fiscal year 1929.
Register of the Treasury
The Register of the Treasury is charged with the final audit and
custody of all retired Federal securities, including interest coupons.
All public debt securities redeemed by the Treasurer of the United
States must be finally audited by the register and certification thereof
made to the Comptroller General before credit is extended to the
Treasurer for amounts expended. The register also establishes credits
due the Federal reserve banks and the Division of Loans and Currency
for securities forwarded by them for retirement on account of
exchanges, replacements, transfer of registration, etc.
During the fiscal year 1929, 42,056,306 security documents, which
represented a face value of $13,459,240,325.93, were retired in the
register's office. Of that number 30,050,683, aggregating $6,353,899,211.21, represented redemptions of public debt securities, 24,610,267 of which, with a face value of $510,021,107.62, were interest
coupons redeemed for cash. There were 1,081,813 security documents, aggregating $2,890,998,505, retired on account of exchanges.
Securities canceled and retired, because no longer appropriate for
issue, amounted to 10,923,810 pieces and aggregated $4,214,342,609.72
in face value.
Exchanged and unissued securities affecting the insular possessions
loans are also functioned in the register's office and are included in
the above figures.
At the close of the fiscal year 1928 there were 435 employees on
the roll of the register's office. During the fiscal year 1929 there were
5 additions and 26 separations, making a net decrease of 21 and bring-,
ing the total number of employees to 414 on June 30, 1929. The
expendituresfor salaries, supplies, etc. during the fiscal year amounted
to $706,192,54. Of this amount $1,516, which is reimbursable,
71799—30—FT 1929
16
210
REPORT ON T H E F I N A N C E S .
was expended on account of auditing and certifying for destruction
securities issued by the banks in the Federal Farm Loan system.
Numerical ledgers are maintained in which are recorded by code the
source and the various transactions connected with each bearer
security received and functioned in the register's office, excepting
Treasury (war) savings securities. These records facilitate answering
inquiries received from various agencies of the Federal Government
and general public. Such inquiries aggregated over 71,000 items
during the fiscal year 1929.
The following comparative statement sets forth by class of security
the total number of documents, together with the face value thereof,
which were received, examined, and ffied during the fiscal years 1928
and 1929:
Summary of securities received, examined, and filed i n the register's office during the
fiscal years 1928 and 1929
1929
1928
Class of s e c u r i t y
Pieces
Pieces
Amount
REDEEMED
Bearer
U n i t e d States securities:
P r e - w a r loans
2,
Liberty loans:
Treasury bonds
Treasury notes..
—
Certificates of i n d e b t e d n e s s
T r e a s u r y (war) savings securities
31,
I n t e r e s t coupons
Securities n o t affecting p u b l i c d e b t :
D i s t r i c t of C o l u m b i a loans
D i s t r i c t of C o l u m b i a interest coupons.
Total
Registered
U n i t e d States securities:
Pre-war l o a n s . . .
Libertyloans.
i
'. ;, T r e a s u r y b.onds
T r e a s u r y notes
Certificates o f i n d e b t e d n e s s
T r e a s u r y (war) savings securities..
I n t e r e s t checks ( L i b e r t y loans)
Total.
Total redeemed.
77
3, 358,468
1,403
9,614
231, 712
348, 598
24, 610, 267
$45, 610. 00,.
957, 564, 400. 00
12, 695, 000. 00
184, 950, 050. 00
1, 861,026, 700.00
667,478. 68
510, 021,107. 62
4,211, 999, 512. 09
28, 560,139
3, 526,970, 346. 30
35
484, 339
15
185
483
1, 343, 635
60,140. 00
337, 309,000. 00
•'•.•n50;'000.00
18,500,000.00
3, 510, 247, 000. 00
179,041, 079.17
21. 25
24
659, 298
63,420.00
290,159,700.00
174
90
830, 948
10
16, 527,000. 00
2, 379,000, 000. 00
141,178,650.27
94.64
90
556,052
$27,910. 00
1, 858,965, 800. 00
98, 582
92,193
518, 687
594,180
471, 715, 250. 00
1, 357,116, 000. 00
1,122, 606. 34
523, 051, 307. 24
11
97
550. 00
88.51
34,859, 892
1, 828, 695
4,045, 307, 240. 42
1, 490, 544
2,826,928,864.91
36, 688, 587
8, 257, 306, 752. 51
30,050, 683
6,353,899,211.21
540
1, 780, 553
65, 265
80, 251
366, 570. 00
594, 305, 500. 00
222, 252, 600. CO
614, 357, 750. 00
631
687, 717
44, 010
34, 758
414, 380. 00
565, 993, 650. 00
149,418, 000. 00
329, 023, 700. 00
107
•. 75,519
• 11, 400. 00
846; 650,'200. 00
61
126, 376
3, 800. 00
1, 462, 372,100. 00
3.764
2, 005,999
3. 729, 000. 00
2, 281, 673,020. 00
. 10, 917
368, 788
8,892
2
4,659
59. 333, 880. 00
474, 484, 400. 00
86, 259, 750. 00
20,000,000:00
983, 025. 00
R E T I R E D ON ACCOUNT OF EXCHANGES FOR
OTHER SECURITIES, ETC.
Bearer
U n i t e d States securities:
P r e - w a r loans
Libertyloans
Treasury bonds
Treasury notes..
F i r s t Z ^ p e r cent L i b e r t y loan i n t e r i m
certificates
. Certificates of i n d e b t e d n e s s
Securities not afiecting'public d e b t :
Insular possessions loans
Total
Registered
U n i t e d S t a t e s securities;
Pre-war loans
.:
L i b e r t y loans
.:
Treasury bonds
T r e a s u r y notes
T r e a s u r y (war) savings securities..
•
3,422
896,975
3, 345, 500. 00
2, 510, 571,130. 00
9, 931
163; 575
9,399
5
737
55, 696, 650. 00
254, 091, 650. 00
47, 432, 650. 00
20,517,000.00
186,425.00
211
SBCKETAKy OP THE TEEASUEY
Summary of securities received, examined, and filed in the register's office during the
fiscal years 1928 and 1929—Continued
1928
1929
Class of security
.
Pieces
Amount
Pieces
Amount
RETIRED ON ACCOUNT OF EXCHANGES FOR
• OTHER SECURITIES, ETC.—Continued
Registered—ConXmuR^
Securities n o t affecting p u b l i c d e b t :
I n s u l a r possessions loans
Total
T o t a l retired
changes, etc
on account
.. ..
of
3,522
$5, 305, 500. 00
1,191
$2,503,000. 00
396, 780
646,366,555.00
184, 838
380,427, 375. 00
2,402, 779
2,928, 039, 575.00
1,081,813
2,890,998, 505. 00
47,549
200
145,736
126,955
6,052,452
28,913, 250.00
10,000.00
233, 846,450. 00
853, 510,600.00
255,457,381. 21
158,639
893,522
86,275,850.00
215, 542, 700. 00
146, 284
9,092,090
886,248, 700. 00
248,352,059.72
ex-
UNISSUED STOCK R E T I R E D
Bearer
U n i t e d States securities:
Pre-war loans
.
L i b e r t y loans
Treasury bonds
T r e a s u r y notes
Certificates of i n d e b t e d n e s s
..
I n t e r e s t coupons
Securities n o t affecting p u b l i c d e b t :
.Insular possessions loans
.
' Total.-..-..u
Registered
U n i t e d States securities:
P r e - w a r loans
Libertyloans
Treasury bonds
Treasury notes.
Certificates of i n d e b t e d n e s s
......
T r e a s u r y (war) savings securities
Securities n o t affecting p u b l i c d e b t :
I n s u l a r possessions loans
Total
T o t a l unissued stock retired
8,200
' 8,200,000.00
6,381,092
1. 379, 937, 681. 21
10, 290,535
1,436,419,309.72
12
615,086
53
101
1
18
127,500.00
187,669,900.00
138,450.00
N o value.
N o value.
1,725.00
148,688
462,872
43
1
703,220,800; 00
2, 065, 443, 700. 00
81,200.00
N o valuG
20,568
6,858,600.00
3,223
4,127,000.00
1,103
2,319,000.00
618,494
192,064,675.00
633,275
2,777,923,300.00
6, 999, 586
1, 572, 002,256.21
10,923,810
4, 214, 342,609. 72
394,480.00
2,482,184, 550.00
222, 262, 600. 00
1,319,919,450.00
159,347
4,939, 707
45,413
44,372
86,736,840.00
1,739,100,750.00
162,113,000.00
613,973,750.00
11,400.00
3,057, 276,800.00
1,122,606.34
778,508,688.45
61
504,372
348, 598
33, 702,357
3,800.00
4, 209,647, 500. 00
667,478. 68
758,373,167.34
11, 929,000.00
550.00
88.51
3,422
3,345, 500.00
43,246,983
7,873, 610, 213. 30
39, 747, 649
7, 473,960, 786. 02
10, 964
1,468,213
8,960
288
484
1, 348,312
3
59, 521, 520. 00
999,463,300.00
86, 548,200.00
38, 500,000. 00
3, 510, 247,000. 00
180, 025, 829.17
21.25
158, 643
1, 285, 745
9,442
180
90
852,253
10
758, 980,870. 00
2, 609, 695,050. 00
47, 513, 850. 00
37,044,000.00
2,379,000,000.00
148, 223, 675. 27
94.64
RECAPITULATION
Bearer
U n i t e d States securities:
630
Pre-war loans .
.
4, 384,154
* " L i b e r t y loans
65,465
Treasury bonds.
T r e a s u r y notes
324,569
F i r s t Z\i per cent L i b e r t y loan i n t e r i m
107
certiflcates
Certificates of i n d e b t e d n e s s
294,667
T r e a s u r y (war) savings securities
518,687
37,646,632
I n t e r e s t coupons _
.
Securities not affecting p u b l i c d e b t :
11,964
I n s u l a r possessions loans
11
District of C o l u m b i a loans
97
D i s t r i c t of C o l u m b i a interest c o u p o n s .
Total
Registered
U n i t e d States securities:
Pre-war loans
Liberty loans.
Treasury bonds
T r e a s u r y notes
' • Certificates of i n d e b t e d n e s s ._
T r e a s u r y (war) savings securities
• . Interest checks ( L i b e r t y l o a n s )
Securi ties.not affecting public d e b t :
t I n s u l a r possessions loans
i
Total.
'
Grand total.. . . .
..
..
.
6,745
9,432,500.00
2, 294
4, 822 000 00
2,843,969
4,883, 738, 370. 42
2,308,657
5, 985, 279, 539. 91
46,090,952
12, 757,348, 583. 72
42, 056,306
13,459, 240, 325. 93
212 .
REPOET ON THE FINANCES
Division qf Public Debt Accounts and Audit
This division maintains administrative control accounts over all
official transactions in the public debt, including those conducted by
the Division of Loans and Currency, the office of the Register of the
Treasury, the office of the Treasurer of the United States, and the
Federal reserve banks, as fiscal agents of the United States, and also
over transactions involving the manufacture,* receipt, custody, and
issue of distinctive silk fiber and nondistinctive paper used for printing public debt securities. United States currency, national-bank notes.
Federal reserve notes. United States postage stamps, internal revenue
stamps, and other miscellaneous securities and documents in the
Bureau of Engraving and Printing. It also performs administrative
audit functions in connection with the foregoing.
On March 30, 1929, the duties of Treasury auditor, as provided
for under the Secretary's orders of February 13, 1925, April 28, 1925,
and October 1, 1927, were transferred and imposed upon the chief
of this division. These duties consist of the maintenance of control
accounts over various classes of unissued currency in reserve stocks
of the Treasurer of the United States, the Comptroller of the Currency, and the Federal reserve banks, and administrative examinations and physical audits of unissued stocks of currency and cash
balances in custody of the Treasurer and the Comptroller of the
Currency, and of collateral securities held in trust by the Treasurer
to secure national-bank currency circulation, postal savings deposits,
postal investments, evidences of the debt of foreign governments,
etc., and the examination and inspection of such books of account,
ledgers, vouchers, receipts, transcripts, and invoices as relate to the
currency»subject to audit. This division conducted audits of the
cash balances in the National Bank Redemption Agency and the
redemption division of the Treasurer's offipe, which audits had not
been accomplished by the former auditor during the year.
At least one audit was conducted during the fiscal year with respect
to each class and denomination of distinctive silk fiber and nondistinctive papec in each division of the Bureau of Engraving and
Printing, with the exception of the wetting division. Due to the
great amount of work occasioned by the production of the new
small-size currency, an audit in that division was not accomplished
untU the early part of July, 1929. Audits in the bureau covered
over 72,000,000 sheets of paper, approximately 60 per cent of which
were sheet counted, and were performed by a force of five auditors
regularly assigned to this work, augmented in some of the larger
audits by additional auditors, and assisted by groups of counters
detailed for that purpose from the Bureau of Engraving and Printing.
Audits conducted in the offices of the Public Debt Service covered
securities of various classes held in custody as unissued stocks, held
213
SECRETARY OF THE TREASURY
as unclaimed or in safe-keeping, and surrendered securities retired
or in process of retirement, registered interest checks, accounts of
registered bond holders, numerical records of retired securities, and
various security records, etc. A force of 13 auditors and audit clerks
were continuously engaged on this work throughout the year.
During the fiscal year this division determined and certified
credits to the cumulative sinking fund and amounts in the sinking
fund available for expenditure from time to time, interest on all
classes of public debt securities which became.due and payable on
their respective interest payment dates, and the amount of each form
of public debt securities and unpaid interest outstanding each month,
prepared statements showing the accountability of Federal reserve
banks for public debt securities for the use of Federal reserve board
examiners in their periodical examinations of those banks, and compiled numerous data pertaining to public debt transactions for various
interested offices and individuals.
The character and scope of the accounts maintained in this division,
as well as the great volume of transactions to which they relate, are
indicated in a measure by the public debt tables appearing elsewhere
in this report which were prepared from those accounts.
Division of Paper Custody
Operations of the Division of Paper Custody during the fiscal year 1929
Kind
Distinctive paper for United States currency, Federal
reserve notes, and national-bank currency:
Old series, type A, 4 subjects
New series, type B, 12 subjects
United States bond paper....
Internal revenue paper
Postage stamp paper
Check paper
Parchment, artificial parchment, and parchment
deed paper
Miscellaneous paper.
Philippine Islands:
Distinctive paper for Philippine currency
Internal revenue paper
Postal card
Porto Rican internal revenue paper
On hand
July 1,
1928
Sheets
23,842,142
4,174,997
5,666,401
27, 364, 610
1,496,000
1, 344,000
Issues
Sheets
Sheets
1 20,105,118
43,947, 260
95, 654,008 2 76, 297,872
3 2,500
669,639
90,731,991
93,059,330
2,904,000
3,762,000
1,784,872
1,116,872
On hand
June 30,
1929
Sheets
23,531,133
4,999,262
25,037,271
638,000
676,000
135,456
1,966,033
332,836
5,183,578
287,913
4,941,054
180,379
2, 208, 557
1,190,856
2,223,500
240,000
16
204, 000
2, 730, 078
75, 000
17,000
140, 000
684, 278
165,000
22,051
211, 000
218,698,419 | 227,712,018
58, 352,931
39,035
147,000
TotalRolls postage stamp paper
Rolls internal revenue paper
Rolls United States security paper.
Receipts
1,973
257
3
;,922
597
9,739
462
13
1 Includes 12,262 sheets cut from 3 rolls.
2 Includes 897,250 sheets used for national-bank currency and Federal reserve notes, old series.
3 2,500 sheets, 21 b y 13, c u t to 5,000 sheets lOH b y 13.
o
1,156
392
214
REPORT ON T H E FINANCES
Custody of Federal reserve notes
. OLD SERIES
Federal reserve bank
On hand July
1,1928
Boston
New York
Philadelphia..
Clevaland
Richmond
Atlanta
Chicago.
St. Loiiis
.Minneapolis..
Kansas C i t y . .
Dallas
San Francisco.
$116, 080,000
241, 480,000
174,860,000
153,220,000
128,300,000
82, 760,000
213,940,000
44, 360,000
49, 520,000
63, 240,000
51 360,000
700,000
Total...
1,387,820,000
NEW
Boston
New York
Philadelphia...
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis.-Kansas C i t y . . .
Dallas
San Francisco..
Total
Received
Issued •
On hand June
30,1929
$39,120,000
78,080,000
42,220,000
13,740,000
66,600,000
32,780; 000
25,740,000
13,280,000
16,620,000
20,140,000
19,560,000
19,140,000
31,880,000
$76,960,000
263,400,000
132,640,000
139,480,000
71,700,000
49,980,000
194,200,000
31,080,000
32,900,000
43,100,000
31,800,000
81,440,000
137,880,000
1,148,680,000
377,020,000
$201,120,000
506,160,000
245,400,000
317,160,000
114,960,000
225,120,000
355,920,000
79,080,000
70,800,000
80,760,000
108,840,000
243,000,000
$82,400,000
231,640,000
27,260,000
88,560,000
93,000,000
85,260,000
232,200,000
46,360,000
70,800,000
70,360,000
15,040,000
99,440,000
$118,720,000
274,520,000
218,140,000
228,600,000
21,960,000
139,860,000
123,720,000
32,720,000
2,548,320,000
1,142,320,000
1,406,000,000
$100,000,000
6,000,000
SERIES
10,400,000
93,800,000
143,560,000
Blank paper counted in the Division of Paper Custody from July 1, 1928, to June
SO, 1929
Sheets
United States securities 8 ^ by 1334—2 R
United States securities 13% by 17%—No lines
United States securities 13K by 16%—No lines
Philippine currency, 7>^ by 14>^—No lines
Total
:
1
32, 172, 856
51, 663, 481
32, 259, 997
2, 223, 500
118, 319, 834
PUBLIC HEALTH SERVICE
Division of sanitary reports and statistics
The division of sanitary reports and statistics is charged with the
work of collecting and disseminating information as to the prevalence
and geographic distribution of diseases dangerous to the public health
both in the United States and in foreign countries.
I n the United States information is secured tlirough officers of the
Public Health Service and State and local health departments. In
order to facilitate the collection of the necessary data, officers of
State and local health departments have been given appointments as
officers of the Pubhc Health Service at nominal salaries ($1 per year).
These officers advise the Pubhc Health Service of outbreaks of communicable diseases, the progress of epidemics, and the prevalence of
endemic diseases. During the fiscal year these reports were collected,
statistics were compiled, and the information was pubhshed in the
weekly Public Health Reports. Some of it was distributed by
means of special bulletins.
Important changes have been made during the last few years in the
international reporting of diseases dangerous to the public health.
The International Sanitary Convention of January 17, 1926, and the
Pan American Sanitary Code, signed at Habana, November 14, 1924,
have made it possible to secure from foreign countries much earher
and more nearly complete reports of the prevalence of the more
important diseases than were available before these conventions went
into force. In accordance with the provisions of the conventions,
notice of first cases of quarantinable diseases and of the progress of
epidemics in the United States has been given to the International
Office of Public Hygiene at Paris and to the Pan American Sanitary
Bureau. In addition, the required information has been sent to
foreign governments through the Department of State.
The Public Health Reports were issued each week during the fiscal
year (annual vol. 43, pt. 2, and vol. 44, pt. 1). In addition to
statistical matter, this publication contained articles reporting the
results of research in public health and other articles of interest to
public health workers. Sixty-one of these articles were reprinted
during the year for more economical distribution.
Work was continued on the compilation and publication of Federal
and State laws and regulations pertaining to public health and
municipal ordinances and regulations of special interest to pubhc
216
216
REPORT ON THE FINANCES
health workers. Current legal digests were searched for court
decisions relating to public health and abstracts of these decisions
were pubhshed in the Public Health Reports.
Two lectures on health subjects were prepared each month for
delivery over the radio. At the close of the fiscal year 54 broadcasting
stations were cooperating with the Public Health Service by sending
out these lectures. This is an effective way of reaching many citizens
who need the information to teach them how to avoid disease and
prolong life.
Material was prepared for several health exhibits,' but it has not
been possible to accomplish much because of lack of funds available
for the purpose. Information was compiled for a large number of
requests pertaining to public health, including statistics, the provisions
of health laws, and other subjects.
Division of foreign and insular quarantine and immigration
Quarantine transactions.—Dunng the fiscal year 27,867 vessels and
3,320,959 persons were inspected by quarantine officers. Of these,
19,529 vessels, 933,035 passengers, and 1,134,906 seamen were ins|)ected upon arrival at stations in the continental United States;
2,937 vessels, 138,947 passengers, and 203,182 seamen were inspected
a t insular stations; and 5,401 vessels, 544,127 passengers, and 366,762
seaimen were inspected at foreign ports prior to embarkation for the
United States.
Of the passengers who embarked at European ports, 43,047 were
vaccuiated and 92,603 were deloused under the' supervision of medical officers of the service. Their clothing and baggage, amounting
to 95,816 pieces, were disinfected.
A total of 5,488 vessels were fumigated either because of the occurrence of disease on board or for the destruction of rodents; and 22,765
rats were recovered, 17,888 of which were examined for plague
infection.
During the year only three cases of smallpox and no cases of plague,
cholera, yellow fever, or typhus fever arrived at quarantine in the
United States. However, in 10 instances during the fiscal year plague
occurred on vessels at foreign ports, and in April a vessel arrived at
Glasgow from Bombay with cases of smallpox on board, following
which France imposed quarantine restrictions against persons coming from Great Britain. There also occurred a severe epidemic of
smallpox in Hong Kong, which spread along the. China coast. The
preventive measures applied by Public Health Service officers at foreign ports of departure is reflected in the small number of quarantinable diseases on vessels arriving at our quarantine stations.
Although but a small number of quarantinable diseases arrived at our
quarantine stations during the year, there have arrived, since Novem-
SECRETARY OF THE TREASURY
217'
ber, 1928, at Pacific coast ports from the Orient, a total of 21 vessels
with 360 cases of cerebrospinal meningitis on board. Cerebrospinal
meningitis is not classed as a quarantinable disease, and therefore
the small numbers of earlier arrivals were taken care of by the local
health authorities. The number of arriving cases increased so rapidly as the winter season advanced that the facilities at the command
of the local health authorities at the ports of Seattle and San Francisco became overtaxed, and at the request of the local health authorities the Public Health Service extended the use of the facUities at
the Federal quarantine stations at these ports for the isolation and
care of the cases and contacts. This was made possible through the
promulgation of an amendment to the quarantine regulations authorizing quarantine officers to detain arriving cases of communicable
but nonquarantinable diseases and persons exposed to such diseases
at the national quarantine stations when local authorities do not have
facilities for their isolation and care. By early spring the quarantine
facilities of both the local and Federal health authorities were becoming overtaxed, and other measures to prevent the spread of this
disease into the United States were con^dered, which resulted finally
in the promulgation of Executive Order No. 5143, under date of June
21, 1929, having for its purpose the restriction and supervision of the
transportation of passengers from ports in China and the Philippinesto United States ports under regulations of the Secretary of theTreasury. Notwithstanding the onset of the more favorable climatic
conditions of the summer season, cases of this disease continue to
arrive at Pacific coast ports, and it is considered probable that with
the onset of another winter season only strict enforcement of theprovisions of this Executive order and the regulations issued thereunder will meet the situation.
On July 1, 1928, a new quarantine station was opened at Portland,,
Oreg., in order better to serve the maritime interests of that port
heretofore served by the quarantine station at the mouth of the Columbia River at Astoria. Approximately 80 per cent of all vesselsentering the Columbia River are destined for Portland, and the
arrangement for quarantine inspection at Portland instead of at
Astoria for such vessels considerably facilitates the movement of
shipping. The station at Astoria is still maintained to take care of
shipping entering the port of Astoria and other river ports between
Astoria and Portland.
During the fiscal year 1929 three amendments to the quarantine
regulations were promulgated:
Amendment No. 11, issued December 22, 1928, amended paragraph
2 of the quarantine regulations so as to exempt aircraft from foreign
ports, or ports in the possessions or dependencies of the United
States, from the necessity of obtaining bills of health except during
2.18
REPORT ON THE FINANCES
the. prevalence of quarantinable disease in such ports of departure
or call. Aircraft'will, however, still be subject to the application of
other provisions of the quarantine laws.and regulations of the United
States upon arrival at airports of entry in the United- States, its
possessions or dependencies. Quarantine services at ports of arrival
are rendered at present to aircraft without cost.
fc; Amendment No. 12, issued December 26, 1928, amended paragraph
40 of the quarajUtine regulations so as to authorize quarantine officers
to. detain arriving cases of communicable but nonquarantinable
diseases and persons having been exposed to such.cases at the national
quarantine stations when local authorities do not have facilities for
their isolation and care. This amendment was promulgated in order
to meet the emergency imposed by' the' arrival of a large number of'
cases of cerebrospinal meningitis at Pacific coast ports of the United
States from the Orient, which overtaxed the available facilities of the
local health authorities, particularly at Seattle and San Francisco.
. Amendment No. 13, issued January. 24, 1929, amended paragraph
37 of the quarantine regulations so as to permit the quarantine officer
soine exercise, of. discretion, within ;limits, respecting the heretofore
mandatory muster of passengers and crews of certain vessels which
carry a medical officer arriving in quarantine from ports classed as
uninfected. This amendment principally facilitates the passage
through quarantine of North Atlantic vessels arriving at the port of
New York.
.
During the past year the Public Health Service made arrangements
for the performance of the necessary quarantine and immigration
inspections in connection with the establishment of airports of entry
in a number of ports. These arrangements were completed at Buffalo
and Albany, N. Y.; Seattle, Wash.; Los.Angeles, Calif.; Brownsville,
Tex.; West Palm Beach, Fla.; San Diego, Calif.; Miami, Fla.; San
Juan, P. R.; and Nogales, Ariz. Similar arrangements were completed
during the preceding year at Key West, Fla., where Meacham Field,
on the Island of Key West, was officially designated an airport of
entry on December 20, 1927. Information was also received of the
designation of airports of entry at St. Paul, Minn., and Newark, N. J.;
but there being no Public Health Service medical officer stationed in
or near these ports and funds for the employment of additional medical personnel not being available, it was impracticable to make
suitable arrangments for the required quarantine and immigration
examinations incident to the arrival of aircraft at these ports.
Several new international bridges were constructed across the Rio
Grande along the Mexican border, resulting in increased quarantine
and immigration activities at those ports. On this account it became
necessary to open a new quarantine station at Thayer, Tex., on
September 1, 1928, and one at Zapata, Tex., on April 1, 1929.
SECRETARY OF THE TREASURY
21.9
Medical inspection of aliens.—There-were 978,354 alien passengers
and 984,771 alien seamen examined by medical officers at the various
stations. Of this number 24,939 passengers and 1,956 seamen were
^'certified'' in accordance with the act of Congress, approved
February 5, 1917.
; The most important causes of certification of alien passengers
were: Trachoma, 590; tuberculosis, 195; feeble-mindedness, 137; insanity, 124; syphffis, 199; gonorrhea, 674.
Of the alien seamen certified 39 were for trachoma, 25. for tuberculosis, 269 for syphilis, 413 for chancroid, and 589 for gonorrhea.
On November 1, 1928, an officer of the Public Health Service was
detailed for duty at the United States immigration station at Northport, Wash., in connection with the medical examination of arriving
aliens. At the same time the Public Health Service officer who had
previously been detailed for duty at the United States immigration
station at Marcus, Wash., for this purpose was discontinued; this
was done because the port of entry for persons crossuig the border
at this point was transferred from Marcus to Northport.
Exarnination of alien passengers abroad.—There were 173,740 applicants for immigration visas examined by medical officers abroad.
Of; this number 2,379 were reported to the consular officers as affhcted
with one or more of the diseases listed in class A as mandatorily
excludable; 15,468 were reported as affiicted with a disease or condition listed in class B as liable to affect their abffity to earn a living;
all of the applicants reported in class A and 5,589 of those reported
in class B were refused immigration visas by the consular officers
because of the findings of the medical examination.
Of 165,772 aliens who had been given a preliminary medical examination abroad and to whom visas had been issued, only 22 were
certified upon arrival at a United States port as being affficted with
class A diseases, resulting in mandatory deportation.
; There has been no material change during the past year in the
system of making medical examinations of applicants for immigration visas in their countries of origin. The many advantages of this
system of the examination of intending immigrants have been amply
demonstrated duriag the four years in which the plan has been in
operation. The policy of making medical examinations, on request
of the consul, of the family units accompanying heads of famffies
intending to emigrate to the United States leaving the family behind
has done much to eliminate criticism of immigration enforcement on
the ground that it causes separation of families.
Division of domestic quarantine
At the begianing of the fiscal year 1929 the health units in the 83
counties in the area affected by the Mississippi flood of 1927, which
had been established under the emergency appropriation, were trans
220
REPORT ON THE FINANCES
ferred to the regular appropriation for rural sanitation work. These
health units have been effective in avertiag outbreaks of disease
which threatened to occur as the result of the destruction of water
supply and sanitation systems, together with lowered resistance of
the population due to stress and strain and poorer economic conditions. A determiaed effort is being made to place these units on a
permanent basis and thus insure the continuation of this muchneeded health service to the people after outside assistance has been
withdrawn.
There are in the United States approximately 2,500 counties or
districts comparable to counties in which the county health unit
plan is applicable. At the beginning of the calendar year 1920 there
were 109 county health units in operation; on January 1, 1929, there
were 467. The annual net gain in this period has been 40, but at
that rate of progress about 51 years will yet be required before all
of the rural communities in the United States wiU be receiving adequate health service.
It is estimated that, apart from the loss in human life and health,,
the national annual economic loss in wages and other items incident
to preventable sickness because of lack of efficient county health
service is more than $1,000,000,000, whereas the cost of such service
would amount to $20,000,000.
The Public Health Service is at the present time cooperating ia
204 counties in 22 States. In each county unit important health
measures are being carried out, such as communicable disease control,,
sanitation of private homes and pubhc places, tuberculosis control,,
iafant and maternity hygiene, venereal disease prevention, school
hygiene, and the like. Various special activities, such as malaria
prevention, goiter prevention, pellagra prevention, are included in
county health programs when the need exists.
Because the vast majority of communities are unaware of the
advantages to be gained through the application of public health
measures, outside stimulus and assistance are essential in order to
secure the establishment of such local health service; and because in
many communities in which the need is most dire, the resources are
so small as to make the proportional cost excessive, outside financial
assistance is necessary until such time as the resources are sufficient
to provide health service at a cost in proportion to that enjoyed by an
average community.
Plague infection contiaues to exist in ground squirrels over large
areas ia the central and coast counties of California south of Carquinez Straits, and must be recognized as a menace to the public
health. Foci of ground squirrel infection have been found in the
counties of Alameda, Contra Costa, Monterey, San Benito, San Luis
Obispo, Ventura, and Santa Barbara during the fiscal year, and if
SECRETARY OF THE TREASURY
221
hunting operations had been more intensive it is believed that the
infection would have been fouiid still to exist in all of the 14 counties
in which it has been known to be present in past years. Two cases
of human plague occurred in Santa Barbara and Monterey. Coun ties
in July and August, 1928.
" The activities of the Public Health Service in the control of ground
squirrels have been conducted in close cooperation with the horticultural commissioners and have been confined to areas around
centers of population in Alameda, Contra Costa, San Francisco, and
San Mateo Counties. In these districts the joint operations have
yielded excellent results and the squirrel infestation has been markedly
reduced.
At the request of the health officer of San Francisco, two experienced
rat trappers have joined with four trappers furnished by the city in
conductiag a survey of the city by trapping and examining rats to
determine whether any evidence of rodent plague infection exists in
San Francisco. The results have been negative. A limited survey
was also conducted in Oakland.
The Public Health Service plague laboratory has continued in
operation as in previous years, the work being devoted mainly to the
routine examination of rodents from the counties and the city of
San Francisco, to determine whether plague infection exists. The
information thus provided is used in directing control operations.
Small trachoma hospitals, with an average capacity of about
30 patients each, have been in operation at Rolla, Mo.; Knoxville,
Tenn.; and Richmond, Ky., throughout the year. It has been
found that the best results are secured by maintaining a treatment
center in one locality until practically all trachoma cases within
traveling distance have been rendered noninfectious.
It is interesting to note that the recent establishment of several
county health units in counties in which trachoma is prevalent
has aided greatly ia the location and follow-up of cases and has
been instrumental in spreading knowledge regarding prevention and
eradication of the disease. Practicing physicians have visited the
hospitals and clinics in order to obtain precise information regarding
diagnosis and treatment.
^ Routine measures for insuring safe water and milk supplies on
interstate carriers, both trains and vessels, have been conducted as
heretofore with gratifying results. State and municipal health
departments, as well as the various railroad and steamship companies, have extended cordial cooperation to the Public Health Service, so that a vast amount of work has been accomplished at very
low cost to the Federal Government.
'The Public Health Service has also received satisfactory cooperation from State health departments. State conservation commis
222
REPORT ON T H E FINANCES
sioners, and shellfish producers in maintaining the present system of
insuring the sanitary control of shellfish in interstate traffic. As the
result of this work no outbreaks of disease due to infected shellfish
have occurred during the year.
Supervision of sanitation in the national parks has been furnished
at the request of the National Park Service as heretofore. This
activity is of increasing importance, as the number of visitors to the
parks becomes greater each year and new areas are opened to the
public.
The twenty-seventh annual conference of State and Territorial
health officers with the United States Public Health Service was
held in Washington, D. C , June 3 and 4, 1929, and was attended by
representatives of 34 States and the Territory of Hawaii. Because
of the importance of the subjects presented for consideration, it was
the consensus of opinion that this was the most valuable conference
which has been held in many years.
Division of scientific research
The scientific research division has continued to carry on investigations under the law empowering the Public Health Service to undertake researches into the diseases of man and the conditions affecting
their propagation and spread. I t has also supervised the enforcement of the,law of July 1, 1902, regulating the sale of viruses, serums,
toxins, and analogous products in interstate traffic:
The cancer studies being conducted both at the Harvard Medical
School in Boston and at the Hygienic Laboratory are making some
solid contributions to the fundamental nature of our knowledge of
this disease. This work has consisted chiefly of the treatment of
cancers in laboratory animals by electric currents of very high frequencies and of tissue, studies.
The Rocky Mountain spotted fever vaccine which has been developed by Public Health Service officers, has been prepared and distributed to physicians and health officers upon request. Results
thus far indicate that the vaccine has a definite field of usefulness, and
studies are being made to devise if possible more economical methods
for its production.
The stream, pollution investigations station continues to be looked
upon as a chief source of information in this country on underlying
scientific principles relating to the effect of various kinds of pollution
of streams and on the processes of natural and artificial purification
which render the waters susceptible of subsequent usfe for drinking
purposes.
.
Reports of the successful operation of the ^'standard milk ordinance'^ iil communities where it has been adopted continue to be
received.
SECEETARY OF THE TREASURY.
223
Studies are under way to determine, if possible, the cause of a
definite increase in malaria observed in certain areas for the first
time in a number of years. The development by service officers of a
power hand blower for the distribution of Paris green has brought this
method for the control of the production of mosquitoes within the
means of almost any community. The practicability of various
m^ethods of malaria control on a county-wide basis have been demonstrated in two widely separated counties.
The studies of industrial hygiene have included occupational health
.hazards, industrial poisons, industrial morbidity and mortaht}^, and
daylight illumination. The child hygiene investigations have been
confined very largely to a statistical analysis of an immense bulk of
material based upon defects and infectious disease in a sample population of children.
The preliminary survey of salt marsh areas of the Atlantic and
Gulf Coast States was terminated at the end of the fiscal year and a
report of the data collected during the period of this survey is in
preparation. The goiter studies were also discontinued during the
year and a manuscript was prepared summarizing the data collected
during the past six years.
The statistical office has been engaged in studies of influenza and
other respiratory diseases, morbidity statistics, current mortality
statistics, current prevalence of disease, and negro mortality.
Immediately following the influenza epidemic of 1928-29 an influ'enza morbidity survey was made in 11 cities in' the United States
in order to obtain an accurate record of morbidity from this disease
comparable to that previously compiled foi the epidemic of 1918.
The investigations of undulant fever have been enlarged to include
the collection of clinical and epidemiological data in cooperation with
State and local health authorities. Undulant fever has proved to be
a disease of considerable public health significance. Investigations of the problems in the basic sciences having relation
to public health, as well as public health problems demanding immediate solution, have continued to engage the attention of the four
divisions qf the Hygienic Laboratory. The division of pathology
and bacteriology have carried on studies of infectious diseases, nutritional diseases., and biological products.
Knowledge of tularsemia, which has been largely developed at the
Hygienic Laboratory, continues to increase, and two additional animal
hosts, the muskrat and the opossum, have been found. Studies on
the distribution, mode of transmission, and spread of endemic typhus
in the southeastern United States have been continued. The evidence collected indicates that the typhus fever which exists in the
southeastern United States has common origin with the typhus of
Mexico and is not dependent upon immigration from the typhus-
224
REPORT ON T H E FINANCES
infected countries of Europe. The role of the vaccination dressing
in complications following vaccination against smallpox has been
studied and a paper published setting forth the results. The search
for the etiological agent in trachoma has been continued at the
branch laboratory at Rolla, Mo.
Studies in nutritional diseases have been continued, special attention having been given to pellagra and the testing of individual foodstuffs to determine their pellagra-preventive value.
The control of biologic products in accordance with the act of
July 1, 1902, is administered from the Hygienic Laboratory and iur
volves considerable research work in addition tp the routine testing of
specimens and the inspection of biologic establishments. Cerebrospinal meningitis has appeared in a number of serious epidemics during
the past year. I t has been observed that the specific serum used for
the treatment of this disease appeared to have unequal or irregular
results. This has led to a vigorous attempt to improve the therapeutic efficiency of these serums.
The division of zoology has been engaged primarily in the preparation of a series of bulletins on the parasites of man and their relation
to animal hosts, and in the examination of intestinal parasites. The
division of pharmacology, in addition to its cancer researches, has
been engaged in studies of the pharmacological action of tuberculoprotein and ergosterol, and correlation of chemical and functional
changes in living tissue and the biological assay of ergot. The work
of the division of chemistry has included application of the specific
tests for cysteine and cystine developed by this division, sugar
researches, and preparation of a general review and bibliography of
synthetic culture media, and the testing of arsenicals.
Division of marine hospitals and relief
Of the 379,731 patients applying to the marine hospitals and other
relief stations of the Public Health Service, the majority were, as
usual, seamen from American merchant ships, who receive approximately 76 per cent of all the hospital care provided for all classes of
beneficiaries, excepting immigrants, foreign seamen, and others for
whose care a reimbursement is made. More than 300 lepers are under
treatment at the National Leper Home, Carville, La., and 19 such
patients were discharged to their homes during the year with disease
arrested. The Coast Guard, whose personnel now exceeds 12,000,
requires, in addition to hospital and out-patient care at the regular
rehef stations, medical services aboard cruising cutters and at important shore stations. Twenty-two medical and dental officers are
assigned to this exclusive duty, and 101 part-time medicaL officers
serve the life-saving stations and other isolated units operated by the
Coast Guard. The usual cooperation was given to the Bureau of
SECRETARY OF T H E TREASURY
225
Prohibition, and 9,070 certificates for medicinal liquor and 128 for the
purchase of narcotic drugs were issued to vessels. Patients of the
Veterans^ Bureau were admitted to all the marine hospitals where
facilities permitted. More than 100,000 physical examinations are
performed each year for various groups of persons and to serve official
agencies, including the following: Applicants and employees, for the
Civil Service Commission; apphcants for pilot's license, for'the Steamboat Inspection Service; able-bodied seamen, for masters and shipping
commissioners; apphcants for mihtary pension and retirement, for the
Bureau of Pensions; longshoremen and Government employees claiming compensation, for the Employees' Compensation Comniission; air
pilots, for the Department of Commerce; civil service employees
suspected of having communicable diseases, for various Government
offices; and applicants to citizens' mihtary training camps, for
the Army.
A daily average of 4,006 patients of all classes was treated in all
hospitals and 741,103 out-patient treatments were given. There
were 1,058 deaths in the marine hospitals and contract institutions.
The marine hospital on Ellis Island was operated for the Bureau of
Immigration primarily for the treatment of detained immigrants, but
also, by special arrangement, for a daily average of more than 200
merchant seamen, representing the overflow^ from, the marine hospital
at Stapleton.
Division qf venereal, diseases
Venereal diseases continue to constitute one of the most important
of the national health problems, although there is evidence that progress is being made in lessening somewhat the prevalence of syphilis.
The major effort in this field is the conduct of scientific research
by the Public Health Service and cooperation with the committee on
research in syphilis in the development of research in leading scientific institutions of this and other countries which relate to clinical,
laboratory, and epidemiological aspects of this problem.
Cooperative activities with States have been continued and expanded. Particular attention was given to the problem of control of
venereal diseases in rural districts and among the negro population.
New activities undertaken by the division of venereal diseases during the course of the fiscal year included the inauguration of an
intensive campaign for the prevention of venereal diseases among
beneficiaries of the Public Health Service employed in the Coast
Guard and in the merchant marine, and a survey of the problem of
disabffities among railway employees in their relation to the cause of
accidents. The active cooperation of a number of the large steamship companies has been obtained, and effort now is being made to
secure the participation of the railroads in a general movement
looking toward the adoption of routine examinations and reexamina71799—30—FI 1929
^17
226
REPORT ON THE FINANCES
tions of all employees, together with the provision of treatment for
venereal diseases without cost to the employee. It is believed that a
material reduction in the prevalence of venereal diseases among
beneficiaries of the Public Health Service eventually can be brought
about, and that there can be thus effected a large saving in the cost
of medical care for the class of patients who must now be treated for
an ffiness which is entirely preventable. It is also believed that
frequent examination of railroad employees throughout the country,
attended by the discovery of disabffities seriously aft'ecting the
efficiency of the men, particularly of those who handle trains and
signals, would be an important step toward the prevention of accidents due to human failure.
At the clinic operated by the Public Health Service in cooperation
with.the State health department at Hot Springs, Ark., the work
continued to increase. The number of new cases admitted during
the past year was 101 per cent greater than the number of admissions
for the first year of operation of the clinic, and there has been a 53
per cent increase in the number of patients since 1926, with the result
that the facilities now available for the medical care of those who
apply for treatment have been severely overtaxed. It is considered
essential that these facilities be extended in order that proper treatment may be given to these indigent patients who come from nearly
every State in the Union and who suffer from infections which make
them a serious menace to others.
The educational work wffich has been carried on by the division of
venereal diseases through the publication and distribution of literature, the circulation of moving-picture films, and the presentation of
papers, lectures, and practical talks to selected groups by various
members of the staff, was continued.
Narcotics division
During the fiscal year 1929 a new administrative division was
created in the office of the Surgeon General of the Public Health
Service, pursuant to an act approved January 19, 1929. That act
authorized the establishment of two institutions for the confinement
and treatment of persons addicted to the use of habit-forming drugs
who have committed offenses against the United States and for those
addicts who may voluntarily commit themselves thereto. The new
division, known as the narcotics division, is charged with the
responsibffity of managing these institutions, the discipline, and the
methods of treatment of those admitted.
A deficiency appropriation for preliminary expenses incident to
operating the new division was made available on March 4, 1929.
Preliminary studies were immediately begun dealing with the subject
of the epidemiology of drug addiction in the United States, with
SECRETARY OF THE TREASURY
227
special reference to the geographical location of the two proposed
institutions. The results of this prehminary survey were assembled
during the fiscal year 1929. Plans have been perfected for continuing
studies along this particular line.
Division of personnel and accounts
The regular commissioned medical corps of the Public Health
Service at the close of the fiscal year included the Surgeon General,
3 assistant surgeons general at large, 25 senior surgeons, 133 surgeons,
26 passed assistant surgeons, and 48 assistant surgeons. Of these
236 officers, 2 assistant surgeons general at large, 13 senior surgeons^
5 surgeons, and 2 passed assistant surgeons were on ''waiting orders."
The number of reserve officers on active duty at the end of the year
was 65, which iacluded 1 assistant surgeon general, 1 senior dental
surgeon, 8 surgeons, 7 dental surgeons, 8 passed assistant surgeons,
14 passed assistant dental surgeons, 23 assistant surgeons, and 3
assistant dental surgeons.
The following list shows the entire personnel of the service as of
J u l y l , 1929:
Commissioned medical officers, regular corps
Commissioned officers, Reserve Corps
Acting assistant surgeons
Attending specialists and consultants
Contract dental surgeons
Internes
Scientific personnel, general
Pharmacists
Scientific personnel. Hygienic Laboratory
Administrative assistants
Druggists
Nurses
Aides
Dietitians
Laboratorians
Pilots
Marine engineers
.
Clerks
All other employees
Total___
.
236
65596'
291
37
62
24
31
33
20
9
442
33
19
30
36
39
_._
466
2, 594
5, 063
This tabulation includes all part-time employees, all persons paid on
a fee basis, and all who receive compensation on a per diem basis when
actuaUy employed. In addition, there are 4,555 appointees of the
service who assist in the collection of current information relating to
the prevalence of communicable disease most of whom are either
officers or employees of State and local health departments, who
receive only nominal compensation, and who send in to the bureau
morbidity statistics gathered by the State and local health agencies.
228
REPORT ON T H E FINANCES
Financial statement.—Following is a statement of appropriations
and expenditures for the fiscal year 1929:
Appropriation title
Salaries, oflQce of Surgeon General
Pay, etc., commissioned officers and pharmacists
Pay of acting assistant surgeons
Payof other employees
i
Freight, transportation, etc
.'
Maintenance, Hygienic Laboratorj'Preparation and. transportation of remains-ofofficers,
Books^i.:....:.!.
.-...
Pay of personnel and maintenance of hospitals
Quarantine service
.'
Preventing the spread of epidemic diseases
Field investigations of public health
Interstate quarantine service
Studies of rural sanitation
,
Control of biologic products
Expenses, division of venereal diseases
Survey of salt marsh areas
Narcotic farms
. Total
-..„.
Appropriated
Expended
$319,480.00
1,229, 574. 00
328,140.00
1,078,670.00
29,000. 00
43,000. 00
2,000.00
500. 00
16,086,766.00
550,310.00
400, 000. 00
317, 540. 00
72, 080. 00
347, 000 00
45,000 00
73,780 00
15,000 00
2 10,000 00
$316,989.38
1, 225,658. 76
327,358.21
1,071,139. 78
28,491. 64
42, 517. 65
695.24
. 487.91
6,053, 618.16
549,870.85
240,690. 68
316,926.34
71,767.91
337, 376. 61
44,845. 56
72,871.11
13,482.67
955.30
10,947,840 00
10,715, 743. 76
1 Includes $595,306 reimbursement for care of Veterans' Bureau patients, and $3,800 miscellaneous reimbursements.
2 Appropriation available for fiscal years 1929 and 1930.
The revenues derived from operations of the Public Health Service
during the fiscal year 1929 and covered into the Treasury as miscellaneous receipts are as follows:
Source
• Amount
Inspectioh, fumigation, and disinfection of vessels at national quarantine stations
Care and treatment of pay patients in hospitals and at relief stations (other than Veterans'
Bureau patients)
.".
'.
Sale of rations
__-Sale of obsolete, condemned, and unserviceable property
Commissions on pay telephones installed in service buildings
Rent of land and buildings
Other revenues
-
$559,970.60
Total
-
-
-
-
60,985.18
16,945.06
8,068.12
554. 38
150.00
4,138. 62
650,811.96
SECRET SERVICE DIVISION
One thousand and thirteen persons were arrested by agents of the
service, or by their direction, during the fiscal year 1929 on charges
involving counterfeiting of the obligations of the United States and
forgery, as well as miscellaneous offenses against the Federal statutes
relating to the Treasury Department and its several branches. Of
this total number taken into custody, 313 were note counterfeiters,
131 were note raisers and passers of altered currency, 148 were coin
counterfeiters and passers, 266 were check forgers, 14 were apprehended for negotiating stolen or forged bonds, and 67 were held for
violation of the adjusted service compensation act.
Twenty-eight new counterfeit note issues appeared during the year,
several being productions of excellent workmanship which circulated
in different sections of the country. Most of these issues, however,
were crude specimens which were quickly detected after the sponsors
placed them in circulation. Not included in tffis record were 38
unidentified counterfeit productions of various types of manufacture,
some being photographic and hand-drawn notes which circulated at
sporadic intervals and were quickly suppressed. Counterfeit notes
aggregating $211,982.55, including fractional currency, and altered
notes aggregating $41,814 were captured or seized during the year by
agents of the seryice, and counterfeit coins aggregating $19,148.70
were also confiscated in connection with raids and subsequent arrests.
Agents also seized or captured 221 plates and glass and filra negatives
for printing counterfeit obligations and securities, 231 moulds for
counterfeiting coins, 19K dies, together with a large, quantity of
miscellaneous materials and paraphernalia.
Of the total number of persons arrested during the year, 539 were
convicted and sentenced, 39 were acquitted, and 259 held to await
court action, One died while awaiting trial and the others were
variously disposed of, some being committed to insane asylums and
others delivered to military or police authorities.
During the year agents investigated 1,076 check cases, 128 bond
cases, and 13 war savings stamp cases, and in check case investigations received and transmitted to the department in restitution the
sum of $19,455.27.
Investigation of violations of the adjusted service compensation act,
involving altered adjusted service certificates, resulted in 67 arrests
by agents during the course of the year in 203 cases warranting
inquiry.
Twelve cases were investigated by the service involviag violation
of the Federal farm loan act, and 100 requests were received from the
General Supply Committee for information concerning prospective
bidders on Government supplies, reports correspondmg to this number
being furnished by field agents.
'
2
2
9
OFFICE OF THE SUPERVISING ARCHITECT
Operations under the public buildings construction program
A summary of pubhc building operations during the fiscal year 1929
follows:
Operations in connection with post offices, customhouses, courthouses, marine hospitals, quarantine stations, etc., and miscellaneous work for the fiscal year 1929
Number of buildings completed (occupied or ready for occupancy)
at the end of the fiscal year 1928, exclusive of marine hospitals and
quarantine stations
1, 342
New buildings completed during the fiscal year 1929, exclusive of
marine hospitals and quarantine stations
22
1,364
Buildings placed under contract during the fiscal year 1929» exclusive of marine hospitals and quarantine stations
Old buildings demolished to make room for new buildings
—
Buildings placed under contract prior to July 1, 1928, and not completed June 30, 1929
21
2
19
4
Total number of buildings completed and in course of construction
June 30, 1929, exclusive of marine hospitals, etc
1, 387
Extensions, etc., completed during the fiscal year 1929
Extensions, etc., in course of construction June 30, 1929__
Total number of extensions completed and under construction June
30, 1929__-Nuniber of marine hospitals and quarantine stations
(Cleveland, Ohio, marine hospital (new), and Detroit, Mich., marine
hospital (new), taking the place of old marine hospitals, were under
construction June 30, 1929.)
Total number of buildings and extensions under the public building program, authorized by acts approved Mar. 4, 1929, and previous acts:
Outside of the District of Columbia
Within the District of Columbia, including purchase of the Economics
Building for th^ Department of Agriculture^
Total projects
Appropriations for sites only
2
15
17
57
334
9
343
9
334
230
231
SECRETARY OF, T H E TREASURY
Of these there had been placed under contract or completed at the
end of June, 1929:
Outside of the District of Columbia
Within the District of Columbia, including purchase of the
Economics Building for the Department of Agriculture.
84
6
90
Total remaining building and extension projects to be carried out
under the public building program (exclusive of site purchases)..
(Of these, 28 projects involve expenditures of from $500,000 to
$1,000,000, and 47 from $1,000,000 to $14,250,000.)
244
Major miscellaneous projects authorized by various acts, placed under contract during
the fiscal year 1929
Building
Boston, Mass., marine hospital
Carville, La., marine hospital
Do
Columbia, S. C , post oflQce
,Fort Stanton, N , Mex,, marine hospitaL...
Galveston, Tex., quarantine station
Nogales, Ariz
Norfolk, Va., marine hospital
'Philadelphia, Pa., m i n t . . , : . . . . . . . . . . . .
Washington, D. C :
National Museum
Treasury
Do
Work
Amount
Extension of nurses* quarters..
Fence, roads, etc
New telephone system
Elevator
Engine and generator
Water service lines, etc
International Street
Breakwater...
Ehgines and generators........
$7,800
28,787
6,528
9,900
12,932
15, OO'O
69,000
11,000
23,676
Roof drainage.^
Elevators
New roof on building in court.
5,055
40,000
6,600
Major miscellaneous projects placed under contract as a charge against various building appropriations during the fiscal year 1929
Building
Boston, Mass., post oflQce
Do
Brooklyn, N. Y., post oflQce
Bronx, N. Y., post office
.Chicago, 111., marine hospital
Do
Cleveland, Ohio, marine hospital
Detroit, Mich., marine hospital
New Orleans, La., quarantine station
New York, N. Y., new appraisers* stores..
New York, N. Y,, Government warehouse—
Springfield, 111., post office
. . . . . . _.'
Utica, N. Y., post office
Washington, D. C :
Commerce Building
Department of Agriculture
Internal Revenue Building .
Amount
.Work
$19,150
61,340
19,765
8,000
23,000
9,594
8,990
12,074
23,990
' 9,977
26, 978
6,800
13,476
Relocating pneumatic tubes
Demolishing old building
Relocating pneumatic tubes
Razing old buildings on site.
Roads, etc . .
Storehouse..
Elevators
do
Wharf and approaches.. _
_. Additions to mechanical equipment
Elevators
Demolition of old building
Elevators
do .
Special lighting fixtures
Pneumatic tubes..
. .
.
. ..
544,967
14,466
27,646
Drawings and specifications for the construction of a hospital building at the Marion (Ind.) Branch Soldiers^ Home were prepared and
delivered to the Board of Governors of the National Home for Disabled Volunteer Soldiers, Dayton, Ohio.
Drawings and specifications were prepared and contracts awarded
for certain additional work at the Alderson, W. Va., Federal Industrial
Institution for Women for the Department of Justice.
Drawings and specifications were prepared and contract awarded
for additional work in connection with the safeguarding of the dome
of the National Museum Building, Washington, D. C.
232
REPORT ON THE FINANCES
Drawings (where necessary) and specifications have been prepared,
bids obtained, and contracts awarded during the fiscal year 1929 for
approximately 40 minor construction projects, 40 minor remodeling
and enlarging projects, 55 surveys of sites (after purchase), 20 planting or seeding projects, 20 contracts for plaster painting in new
buildings, 18 contracts for plaster models, 140 miscellaneous betterments, 10 leases of temporary quarters, 5 contracts for moving into
leased quarters, all under the special appropriations for buildings.
This does not include changes in existing contract work.
The following table shows the status of contracts which were
authorized under the acts of July 3, 1926, March 5, 1928, May 5,
1928, May 29, 1928, December 20, 1928, and March 4, 1929:
Limit of cost and location of buildings and extensions authorized by acts of July 3,
1926, March 5, 1928, May 6, 1928, May 29, 1928, December 20, 1928, and
March 4, 1929, which have been completed or placed under contract at the end of
the fiscal year 1929
Not completed
Completed
Limit of
cost
Building
Extension'
Building
$565,000 Akron, Ohio (1929)
165,000
Asheville, N. C
650,000
80,000 Batavia, 111. (1929)
230,000 Bayonne, N. J-....
Birmingham, Ala.
425,000
75,000 Branford, Conn
92,000 'Buffalo, Wyo. (1929)
65,000 Central City, Nebr
54,000 Chamberlain, S. Dak
Canton, Ga. .
60,000
90,000 Cody, Wyo
Cleveland, Ohio (ma1,813,523
rine hospital).12
70,000 Caribou, Me. (1929)
250,000 Coeur D'Alene, Idaho
(1929).
Conway, A r k . .
95,000
75,876
Chicago, 111. (ma433,000
rine hospital, extension, remodeling,, etc.).
90,000
Dallas, Tex
1,500,000
Des Moines, Iowa 2.... .
665,000
Detroit, Mich, (marine
600,000
hospital).
95,000 Donora, Pa. (1929)
Duluth", Minn
1,515,000
Dunkirk, N. Y
100,000
160,000 Durango, Colo. (1929)...
285,000 East Orange, N. J. (1929).
175,000
265,000
90,000 Fallon, Nev. (1929)
Fairfield, Iowa.. .
120,000
90,000 Fort Fairfield. Me. (1929)
165,000 Globe, Ariz. (1929)
155,000
200,000 Jamestown, N. Dak.
(1929).
Lancaster, Pa
600,000
75,000 Lancaster, S. C
. .151,000 Las Vegas, N. Mex.
(1929).
145,000 Leominster, Mass. (1929)
108,500 Lewistown, Pa
» Not included in the public building .program...
« Contracts awarded prior to July 1", 1928, and hot completed.June 30,1929.
Extension
Anderson, Ind.
Corinth, Miss.
Corsicana, Tex.
Elizabeth, N. J.
Elmira, N. Y.
Hammond, Ind.
233
SECKETAEY OF THE TREASTJBY
Limit of cost and location of buildings and extensions authorized by acts of July 3
1926, March 6, 1928, May 5, 1928, May 29, 1928, December 20, 1928, and
March J^., 1929, which have been completed or placed under contract at the end of
the fiscal year 1929—Continued
Completed
Limit of
cost
$475,000
65,000
635 552
116 000
325 000
90 000
90 300
400 000
70 000
295 000
75 000
100 000
65 000
102 000
112 500
125 000
500 000
Building
Not completed
Extension
Mill ville, N. J. (1929)...
^
Metropolis, III.2
Missoula, Mont
Montclair, N. J
Montevideo, Minn
Mount Carmel, 111
Olyphant, Pa. •
Paxton, 111
Plattsburg, N. Y
Va.
Wilson, N. C. (1929)
Winchester, Mass. (1929)
Prescott, Ark
Red Bluff, Calif
Sand Point, I d a h o . . .
Sandusky, Ohio
Yonkers, N. Y. (1929)...
Pontiac, Mich.
Santa Fe, N. Mex.
Tucson, Ariz
Washington, D . C . (Department of Agriculture Administration
Building) .3
Washington, D. C. (Department of Commerce).
Washington, D.C.
Liberty Loan
Building, additional stories).
Washington, D. C.
(Government
Printing Office).
Washington, D. C. (Internal Revenue Building).
Wilmington, Ohio
Wyandotte, Mich
' Contracts awarded prior to July 1,1928, and not completed June 30,1929.
Paris, Tenn.
Springfield, 111... .
9,185,000
375, 000
New York, N. Y.
(Old Appraisers'
Stores).
Niagara Falls, N.Y
Sayre, P a . .
325, 000 Washington, D.C. (Department of Agriculture, E c o n o m i c s
Building, (purchase)).
W.
Mitchell, S. Dak.
New Philadelphia, Ohio.
Newton, Iowa
17,500,000
Williamson,
(1929).
Memphis, Tenn.
Newark, Del
Newburyport, Mass
1,250,000
110,000
205,000
75,000
60,000
95,200
80,000
255,000
80,000
99,000
500,000
Extension
Long Island City, N. Y.*
McKees Rocks, Pa
Madison Wis. (1929)
Marianna, Fla
75,000
70,000
50,000
245,000 Paris, Tex
.
80,000
120,000
200,000
270,000
81, 500
70,000 Shelbyville, Ky
110,000 Soiithbridge, Mass.
(1929).
850,000
1,500,000 Syracuse, N. Y. (1929) _.
70,000 Tarentum, Pa
72,000 Tomah, W i s . . . . . .
540,000
..
800,000 Utica, N. Y.
2,000,000
195,000
Building
Wooster, Ohio.
234
REPORT ON T H E FINANCES
The buildings, extensions, and sites authorized but not under
contract on June 30, 1929, are as follows:
Buildings, extensions, etc., authorized in act approved March 4, 1929, and previous
acts under public building program, not under contract June 30, 1929
199 BUILDINGS
Alaska:
Juneau, post office and customhouse.
Alabama:
Sheffield, post office.
Union Springs, post office.
Arizona:
Douglas, inspection station.
Prescott, post office.
San Luis, inspection station.
Arkansas:
El Dorado, post office and courthouse.
Little Rock, post office and courthouse.
California:
Calexico, inspection station.
Long Branch, post office.
Oakland, post office and customhouse.
Pomona, post office.
Sacramento, post office and courthouse.
San Bernardino, post office.
San Francisco, Federal office building.
San Francisco, marine hospital.
San Pedro, post office and customhouse.
Santa Ana, post office.
San Ysidro, inspection station.
Tecate, inspection station.
Colorado:
Canon City, post office.
Denver, customhouse.
Sterling, post office and courthouse.
Connecticut:
Bridgeport, post office.
Hartford, post office and courthouse.
Milford, post office.
Putnam, post office.
Waterbury, post office.
Delaware:
Georgetown, post office.
District of Columbia:
Extensible Building, Department
of Agriculture.
Archives Building.
Florida:
Jacksonville, post office.
Miami, courthouse and post office.
Georgia:
Atlanta, post office.
West Point, post office.
Idaho:
Nampa, post office.
Illinois:"
Aurora, post office.
Bloomington, post office.
Carbondale, post office.
Chicago, post office.
Freeport, post office.
Waukegan, post office.
Indiana:
East Chicago, post office.
Fort Wayne, post office and courthouse.
La Fayette, post office.
Rushville, post office.
South Bend, post office and courthouse.
Iowa:
Cedar Rapids, post office and
courthouse.
Iowa City, post office.
Mason City, post office.
Kentucky:
Harrodsburg, post office.
Lexington, courthouse.
Louisville, post office, courthouse,
and customhouse.
Kansas:
Dodge City, post office.
Junction City, post office.
Wichita, post office.
Louisiana:
Bogalusa, post office.
Mansfield, post office.
New Orleans, marine hospital.
New Orleans, quarantine station. "
SECEETAEY OF T H E TEEASTJEY
Maine:
Brunswick, post office.
Eustis, inspection station.
Fort Fairfield, inspection station.
Houiton, inspection station.
Limestone, inspection station.
Portland, post office.
Maryland:
Baltimore, immigration station,
marine hospital, and post office.
Cumberland, courthouse and post
office.
Massachusetts:
Boston, post office and immigration
station.
Brockton, post office.
Fall River, post office. •
Framingham, post office.
Gloucester, post office.
Haverhill, post office.
Lowell, post office.
Maiden, post office.
Springfield, post office and courthouse.
' Waltham, post office. Worcester, post office and courthouse.
Michigan:
Benton Harbor, post office.
Detroit, customhouse.
Flint, post office.
Ironwood, post office.
Minnesota:
Minneapolis, post office and courthouse.
Noyes, inspection station.
St. Paul, post office and customhouse.
South St. Paul, post office.
Mississippi:
Jackson, post office and court
house.
Kosciusko, post office.
Lumberton, post office.
Missouri:
Kansas City, post office.
St. Louis, court house and customhouse.
Sedalia, post office.
Trenton, post office.
J Separate appropriations for land and building.
235
Montana:
Babb-Piegan, inspection station.
Havre, post office.
Lewistown, post office.
Sweetgrass, inspection station.
Nebraska:
Crete, post office.
Scottsbluff, post office.
Nevada:
Goldfield, post office.
Reno, post office.
New Hampshire:
Claremont, post office.
Hanover, post office.
Manchester, post office.
NewJersey:
Camden, post office and courthouse.
Hoboken, post office.
Newark, post office and courthouse.
Passaic, post office.
Paterson, post office.
Princeton, post office.
Red Bank, post office.
Trenton, post office.
New Mexico:
Albuquerque, post office and courthouse.
Clovis, post office.
New York:
Albany, post office.
Bronx, post office.
Champlain, inspection station.
Chateaugay, inspection station.
Fort Plain, post office.
Newburgh, post office.
New York, assay office.
New York (Stapleton), marine
hospital.
New York, parcel-post building(2) .*
Peekskill, post office.
Rouses Point, inspection station
(2) .2
Trout River, inspection station.
White Plains, post office.
North Carolina:
Greensboro, post offi„C(3 and courthouse.
Lenoir, post office.
2 Two sites and buildings.
236
REPORT ON T H E FINANCES
North Dakota:
Fargo, post office and courthouse.
Pembina, customhouse.
Portal, inspection station.
St. Johns, inspection station.
OhioCanton, post office.
Cleveland, post office.
Fremont, post office.
Lima, post office.
Toledo, courthouse and customhouse.
Urbana, post office.
OklaTtioma:
Bartlesville, post office.
Okmulgee, post office and courthouse.
Oregon:
Corvallis, post office.
Klamath Falls, post office.
Portland, courthouse.
Pennsylvania:
Altoona, post office.
Carbondale, post office.
Erie, post office.
Pittsburgh, post office and courthouse.
Tamaqua, post office.
Scranton, post office and courthouse.
Tyrone, post office.
Uniontown, post office.
Warren, post office.
Waynesburg, post office.
Rhode Island:
Pawtucket, post office.
West Warwick, post office.
South Carolina:
Hartville, post office.
Spartanburg, post office.
South Dakota:
Vermilion, post office.
Tennessee:
Kingsport, post office.
McMinnville, post office.
Te.xas:
El Paso, Federal office building.
' Two sites and buildings*
Texas-—Continued.
Fort Worth, post office and courthouse.
Galveston, marine hospital.
Lubbock, post office.
Mexia, post office.
Sabine Pass, quarantine station.
Taylor, post office.
Utah:
Price, post office.
Vermont:
Alburg, inspection station.
Beecher Falls, inspection station.
Bellows Falls, post office.
Derby Line, inspection station.
East Richford, inspection station.
Highgate Springs, inspection station.
Richford, inspection station.
Rutland, post office.
Virginia:
Alexandria, customhouse and post
office.
Buena Vista, post office.
Lynchburg, post office and courthouse.
Roanoke, post office.
Washington:
Blaine, inspection station (2) .2
Hoquiam, post office.
Pullman, post office.
Seattle, immigration station, assay,
office, and Federal office building,
Sumas, inspection station.
West Virginia:
Clarksburg, post office and courthouse.
Parkersburg, post office.
Wisconsin:
Appleton, post office.
. Kenosha, post office.
Marshfield, post office.
Oshkosh, post office.
Racine, post office.
Wyoming:
Casper, post office.
SECRETARY OP T H E TEEASURY
237
36 EXTENSIONS
Connecticut:
New Britain, post office.
Florida:
Lakeland, post office.
Tampa, post office and customhouse.
Georgia:
Savannah, post office and courthouse.
Hawaii:
Honolulu, post office, courthouse,
and customhouse.
Idaho:
Boise, post office.
Illinois:
Ottawa, post office.
Indiana:
Kokomo, post office.
Kansas:
Lawrence, post office.
Massachusetts:
Fitchburg, post office.
Pittsfield, post office.
Michigan:
Battle Creek, post office.
Mississippi:
Greenwood, post office.
New York:
Amsterdam, post office.
Brooklyn, post office.
Watertown, post office.
North Carolina:
New Bern, post office, courthouse,
and customhouse.
Salisbury, post office and courthouse.
Ohio:
Hamilton, post office.
Youngstown, post office.
Oklahoma:
Oklahoma City, post office arid
courthouse.
Tulsa, post office and courthouse.
Pennsylvania:
Philadelphia, marine hospital.
Wilkes-Barre, post office.
Rhode Island:
Woonsocket, post office.
South Dakota:
Sioux Falls, post office and courthouse.
Tennessee:
Memphis, customhouse, courthouse, and post office.
Texas:
Beaumont, post office {2)^.
Greenville, post office.
Utah:
Ogden, post office and courthouse
(2)3.
Salt Lake City, post office and
courthouse.
Virginia:
Portsmouth, post office and customhouse.
Richmond, post office, courthouse,
and customhouse.
West Virginia:
Morgantown, post office.
Wisconsin:
La Crosse, post office and court*
house.
Milwaukee, post office, court
house, and customhouse.
9 SITES PRELIMINARY TO CONSTRUCTION
Las Vegas, Nev., post office.
New York, N. Y., courthouse and post' office annex.
Rock Hill, S. C , post office.
St. Louis, Mo., post office.
Stamford, Conn., post office.
Topeka, Kans., post office.
Washington, D. C , Supreme Court
building.
Zanesville, Ohio, post office.
Projects in the District of Columbia.—The District of Columbia
program as far as authorized involves a total of $75,000,000, of
which $25,000,000 is for the purchase of land in the so-called triangle
3 Separate appropriations; one for additional land and one for extension of building.
238
REPORT ON THE FINANCES
and $50,000,000 for the carrying out of a number of projects, those
specifically authorized aggregating $47,968,741. Of these, projects
involving a limit of cost of $2,718,741 have been completed, and
four large buildings, involving a limit of cost of $30,750,000, are
under construction—Administration Building, Depart]tnent of Agriculture; Commerce Department Building; Government Printing
Office; and Internal Revenue Building. The first named is nearing
completion; the last named is making exceptionally good progress,
and the other two are making normal progress. The two remaining
projects—Extensible Building, Department of Agriculture, and the
Archives Building—are awaiting title to the sites.
Under the authorization of $25,000,000 in the act of January 13,
1928, for the acquisition of the property in the triangle, involving
17 squares, land has been acquired totahng $4,508,041, and it is
estimated that it will take $15,970,000 to acquire the remaining
land, for most ol which condemnation proceedings have been requested. It is estimated that all land under this authorization.
will have been acquired by the end of the fiscal year 1931;
Remodeling and enlarging public buildings
Under the appropriation of $500,000 for '^ Remodeling and enlarging public buildings," 71 buildings received attention, the limit
of expenditure for any one building being $25,000. In 45 of these
the contracts ranged from $1,100 to $24,361.95, totaling $486,733.27.
The total obligation to June 30, 1929, was $494,581.95. The total
space gained was 79,792 square feet, at an average cost per square
foot of $6.10.
Public buildings remodeled or enlarged, amount of the contract, and space gained
during the fiscal year 1929
.
'
Location
Auburn, Me., post office
._
_
Baltimore, Md,, customhouse.__
Bar Harbor, Me., post office
..:
Beaver Falls, Pa., post office
...•.
Birmingham, Ala., post office
Bloomington, Ind., post office
Bradford, Pa., post office
Buffalo, N. Y., marine hospital
Carlisle, Pa., post office..
_
Cuero, Tex., oost office
Danville, Va., courthouse and post office.
Fayetteville, N. C , post office
_
Fredericksburg, Va., post office
Galena, 111., post office
Gloversville, N. Y., post office
Goldsboro, N. C , post office
Hastings, Nebr., post office.
Work
Extension...
Alterations.,
.do.
Extension...
Alterations..
Extension...
do
Alterations..
Extension...
Alterations..
do
do
Extension...
Alterations..
Extension...
.....do
do
Amount of
contract
$16,002.32
3,363.00
3,584.00
14, 685.40
2, 218. 50
19, 225.00
20, 481. 00
1, 479.00
20,396.00
1,835. 00
4,481.00
3,600.00
17,843.00
2, 443.00
• 22,879.00
16,766.46
24,003.00
Space
gained
Sg.ft,
1,100
1,000
1,000
1,830
1,000
2,298
2,020
1,000
1,800
1,500
1,000
1,000
1,400
1,000
2,000
1,600
2,165
239
SECRETARY OF. T H E TREASURY
Public buildings remodeled or enlarged, amount of the contract, and space gained
during the fiscal year 1929—Continued
Location
Jacksonville, Fla., courthouse and post office
Lancaster, Ky., post office
Lexington, Va., post office..
Marietta^ Ohio, post dfficie:.......
Marshall, Tex., post office
New Brunswick, N. J.jpost office
Newton, Kans., post office
Oak Park, 111., post office
Ogdensburg, N. Y., customhouse and post office.
Olympia, Wash., post office
Orlando, Fla., post office
Oskaloosa, Iowa, post office
Parkersburg, W. Va., courthouse and post office.
Pittsburgh, Pa., marine hospital
Portland, Me;, courthouse
Portland, Me., marine hospital
Portsmouth, N. Hi., post office
RedjWing, Minn., post office
Riverside, Calif., post office
Rochester, Minn., post office
Rochester, N. Y., courthouse, post office, etc
Salem, Oreg., post office.
Santa Barbara, Calif., post office.
Sharon, Pa., post office
Shenandoah, Iowa, post office.
Trinidad, Colo., post office
,
Waukesha, Wis., post office
Waxahachie, Tex., post office
_
Work
Extension
......do.......
Alteratioiis
Mailing'vestibule, etc.
Alterations..
Extension
do..
Extension to workroom.
Alterations..-.
Extension
....do
'.....do
Alterations
1...
do
....do
....do
do.
Extension...
.....do.......
Alterations..
.do..
Extension...
Alterations..
Extension...
Alterations..
do
....do
do
Total of 45 major items...
Totallof 26 miscellaneous items.
Grand total..
Amount of
contract
Space
gained
$13,695.00
15,410.00
1,685. 00
7, 563.00
1.210.00
24,323. 00
22, 565. 00
3, 600.00
7,517.52
24,361. 95
22, 018.43
20,812.00
3,800.60
' 4,848.00
8,104.00
2,806.00
1,150. 00
22,573.00
20,025.50
1, 200.00
5,095.00
23, 429. 00
1, 422. 00
20,100. 00
1,100.00
2,040.00
6, 262.60
3,832.00
2,280
1,500
300
1,104
800
1,400
1,450
800
1,000
2,000
2,630
2,200
1,000
2,800
2,400
1,000
800
1,400
2,100
800
1,000
1,345
700
2,154
700
1,000
282
850
486,733.27
7,848.68
62,508
17,284
494,581.95
79,792
Sites
Of the 189 new cases where sites and additional sites were appropriated for by the acts of March 5 and May 28, 1928, and March 4, 1929,
for projects outside of, the District of Columbia (under the $200,000,000 authorization), 78 cases have been closed, involving an expenditure of approximately $14,519,000; in 37 cases proposals have been
accepted for land in amount $2,835,000, and selections made in 23
cases involving nearly $5,600,000 and referred to the Department of
Justice for institution of condemnation proceedings.
The remaining 51 cases are either in the advertising or negotiation
stage, and definite action in the majority of these cases will be taken
before the end of the calendar year. The amount which will be required to obtain the necessary land in these cases will probably exceed
$10,000,000.
240
REPOPtT ON THE FINANCES
Expenditures, liabilities, and unencumbered balances
The total expenditures of the Office of the Supervising Architect
from July 1,1928, to June 30,1929, contract liabilities charged against
appropriations, and unencumbered balances were as follows:
Expenditures, contract liabilities, and unencumbered balances, fiscal year 1929
Expenditures
Statutory roll
_
Sites and additional land
Construction of new buildings
Extensions to buildings
Miscellaneous special items
Unallotted appropriation (lump sum)
Remodeling and enlarging public buildings
Relief of contractors, etc., for public buildings under
Treasury Department
Hospital construction, Public Health Service
Hospital facilities for war patients
Lands and other property of the United States.
Repairs and preservation
Mechanical equipment
Vaults and safes
Operating supplies
General expenses
Furniture and repairs
Operating force
Additional lock-box equipment!
Rent of temporary quarters
Outside professional services
Total
:
1 Includes $2,500 reserve 1928.
2 Includes $5,000 reserve 1928; $5,000 reserve 1929.
3 Includes $5,000 reserve 1928; $5,000 reserve 1929.
$365,198. 52
20, 664, 771. 25
8,144, 658. 08
1, 651, 470. 68
64, 522. 78
336, 360. 63
Contract liaUnencumbilities charged bered
balances
against appro- June 30,1929
priations
$4, 649, 006. 43
31,077, 092. 69
1, 368, 288. 48
163, 632.18
222,048. 22
$7, 766.48
14,492,491. 70
31, 350,360. 59
3, 740, 796.43
24,342. 08
13,145, 500. 00
6,024. 08
606. 46
2, 500.00
11.00
1,037, 036. 61
561,049. 21
118, 219. 82
2,871,766.89
1, 300, 912. 48
959,838.11
7, 227, 797.48
35,323.16
162,372. 39
387, 201. 87
45,889,117. 42
257,974. 58
89, 082. 91
55,417.15
302, 285.40
92, 769. 44
181,'460.16
635,412. 91
64,335. 24
155, 546.84
211, 527. 82
39,528, 379.45
589.00
1 17,467. 56
15, 530. 79
2 41. 549. 52
3 376, 964. 28
* 480,126.15
« 22, 591.40
76, 758. 03
341. 60
« 315, 240. 77
205, 270. 31
64,319, 710. 77
* Includes $25,000 reserve 1928; $25,000 reserve 1929.
«Includes $5,000 reserve 1928; $5,000 reserve 1929.
8 Includes $5,000 reserve 1928.
The following statement, prepared pursuant to the act approved
June 6, 1900 (31 Stat. 592), shows the public buildings under the
control of the Treasury Department and the aggregate expenditures
to June 30, 1929, in connection therewith:
Aggregate expenditures to June 30, 1929, for buildings under the control of the
Treasury Department, and the unencumbered balance of appropriations
Total expendiExtensions,
Construction alterations, and Annual repairs tures, June 30,
1929
special items
Post office, courthouse, customhouse
$104,897, 064.07 $17,343,001.28 $17,897, 704. 70 $140,137, 770.06
buildings, etc
804,806. 50
372,236. 91
8^, 169.44
1,262.212.86
Courthouse buildings
2,402,895.83
3,452,033. 04
28,967,470.47
Customhouse buildings
_ 23,112, 541. 60
4,900,940. 95
3,250, 316.89
3,551,821.19
Marine hospital buildings _
11,703,079.03
9,955, 716.14
4,399,287.95
Post office buildings
. .
. 89,848,418.24
104,203,422.33
3,075, 007.45
1,468,344. 62
2,335, 049.82
6,878,401.89
Quarantine station buildings
_
493,355.47
104,010. 20
369,076. 52
966,442.19
Veterans'hospital buildings
35,404, 741. 73
5, 642,150. 93
4,517,483.22
45; 564,'375.88
Miscellaneous buildings
339,683,174. 69
Total
262, 536,876. 01 36,052,922.46 .41,093,376.22
Cost Of sites
Post office, courthouse, custotnhouse
buildings, etc
$22,813,308.07
548,334. 69
Courthouse buildings
3, 783,322.33
Customhouse'.buildings
Marine hospital buildings
799,238.97
Post office.buildings...
31, 073,189.10
Quarantine station buildings^ . . ^'.. .
308,837.60
Miscellaneous buildings
i
28,151,491.34,.
Unallotted appropriation (lump s u m ) . .
Total
87,477, 722.10
Outstanding liabilities chargeUnencumbered
able against appropriations
balance of
appropriations
Sites
Buildings
$1,651,507.83
1,926,700.00
11,505.00
1,070,798.60
$4, 629, 632. 32
269,377.03
29,205. 00
1,289,120. 55
1,848,206. 90
41,377. 04
24, 590, 589. 51
4, 660,511.43
32, 597, 508. 35
$15,074,077.31
353,112.62
156,577.00
- 1,130,657.84
15,637, 034. 77
194,468. 57
17,062,062. 69
13,145, 500.00
62,753,490.80
DIVISION OF SUPPLY
The Division of Supply, in-the office of the Secretary, is the central
procuring or purchasing agency of the Treasury Department, and, as
such, does the purchasing for all local and field activities, with the
exception of'those from appropriations for the Bureau of Engraving
and Printing (which are exempted by law), the Coast Guard, and to
some extent the Bureau of the Mint. It is charged also with certain
duties closely related to purchasing, such as accounting for funds
appropriated or allotted to it; supervision over printing and binding
for the Treasury Department and engraving work by the Bureau of
Engraving and Printing for all departments and establishments,
unless money, bonds, or stamps are involved; control over newspaper
and periodical advertising for the department; routing of all freight,
express, and parcel-post shipments; and warehousing and distribution
of stationery and miscellaneous supplies, including blank books and
forms, to Washington and field offices of the Treasury Department.
The appropriations to the department for purchases of stationery,
for printing and binding, and for postage are under its administrative
control, and it exercises, immediate supervision over the work of the
General Supply Committee.
Expenditures from various appropriations
The total cost of purchases made by the Division of Supply during
each of the past five fiscal years from specified appropriations from
which allotments.were made to the division to cover expenditures
made by it, and also purchases chargeable to appropriations from
which no aDotments were made, are shown in the following table:
Expenditures by Division of Supply, fiscal years 1925-1929, by appropriations
Bureaus and offices, and titles of
appropriations
Chief clerk and superintendent:
Contingent expenses, Treasury DepartmentCarpets and repairs
File holders and cases
Freight, telegrams, e t c —
Fuel, etc
Furniture, etc
1
Furniture, 1924-25
Gas, etc
.
Motor vehicles
Miscellaneous items
Newspaper clippings and
books
Rent
71799—30—FI 1929-
1925
1926
1927
1929
1928
$494.02
3,979. 50
9,886. 60
19, 663. 58
4, 422. 57
1,991.84
20,859. 45
7, 496. 24
13. 220.33
$498.93
3,996.87
9,856.30
18,396.30
° 4,480.25
$496. 57
4,974. 21
9,904. 21
18, 002.16
7,462. 68
$929. 75
7,966.51
35.00
19,169.44
6,104. 52
$977.83
7,969. 07
52.81
16,115. 60
6, 513.52
18,144. 52
6,976.42
12,769.81
18,392. 51
9,351.86
11,439. 41
1, 079. 55
23,425.88
10,946.33
922.89
24, 288. 56
11,549.10
483. 53
14, 649. 92
985.16
14,650.00
.• 997.28
12,.500. 00
-18
934.49
981. 57
241
242
REPORT ON THE FINANCES
Expenditures by Division of Supply, fiscal years 1925-1929, by appropriationsContinued
Bureaus and offices, and titles of
appropriations
Chief clerk and superintendentContinued.
L a b o r - s a v i n g machines,
Treasury Department
operating. expensesT r e a s u r y Department
Annex ..'. ."
Darby Building.,
Library, • Treasury Departinent
...
Total
...
-
Division of Supply:
Stationery, Treasury Department .- -.
Printing and binding, Treasury Department
Postage, Treasury Department
.....
Materials for bookbinder,
Treasury Department
General Supply CommitteeTransfer of office material, supplies and equipment
Salaries, General Supply
Committee
Salaries and expenses. General Supply Committee
Total
Division of Bookkeeping and
Warrants: Contingent expenses,
public moneys
Bureau of Customs:
Collecting the revenue from
customs _
Equipment, appraisers stores,
NewYork, 1 9 2 8 - 2 9 . . . . . . . .
Total
1925
1926
1927
1928
1929
$19,909. 58
$13, 799.36
$13,924.13
$39,016. 44
$31,475. 24
12,935.35
3,820. 61
11, 988. 56
3, 560. 03
11,877. 40
3,824.36
2, 224. 25
1,466.56
3,167. 60
1,634.44
133,812. 92
120,102. 51
342,952.44
368,948. 86
(')
(0
(0
(0
1,999. 75
1, obo. 00
990 53
125,146. 53
114,298.72
106,638.76
458, 556. 57
446,043.39
3 788, 641. 70 2 892,136.93
1,000.00
(»)
249.84
1,000.00
(3)
432,741.00
2 792,634.45
986 76
(•)
•
105, 606. 55
(•)
41,339.73
77,188. 71
115,683.58
448, 808.83
487,477. 30 1,363,881.85
114,705. 20
128, 215.82
1,453,885. 52 1,354, 578.03
2,442.41
1, 269.92
2, 643. 23
2,875. 39
4,478.23
179, 643.84
233,483.02
271,195.76
216,122.10
395,473.19
179, 643.84
233,483.02
271,195. 76
216,122.10
454 634 67
59,161.48
Public Health Service:
Pay of personnel and maintenance of hospitals
1,736,589. 68 1, 632,874. 69 1, 570,880. 71 1, 794, 610. 31 1,766,715.26
Quarantine service
.. ..
311,462. 22
296,458. 24
311, 630. 66
292, 784.45
276, 242. 06
Interstate quarantine service204.92
474.99
5, 247.36
2,463.23
3, 520. 65
Interstate quarantine service,
1925-26
1, 989. 66
7,115.34
Maintenance of Hygienic
Laboratory.
33,815.11
33, 959. 64
33, 589.88
33, 287. 36
34,250.06
Field investigations
17,624. 55
15, 600. 72
20,901.09
27 077 31
23, 851. 61
Preventing the spread of epidemic diseases
37,495. 77
21, 704.93
33, 845.45
32,711.21
36,957. 06
Preventing the spread of epidemic diseases, 1925-26
7,200.62
25,165.13
Expenses, division of venereal
diseases
:
4, 423. 69
2, 302.06
4, 572. 22
4, 373. 97
3,040. 74
Control of biologic products...
26,452; 97
18,087. 66
19, 815.91
16, 482.83
22, 671. 28
Books.. . 499.93
448. 24
434 15
497.96
493.24
Studies of rural sanitation
200.00
40.00
Quarantine station, Boston,
Mass
_
3,110. 00
Marine hospital, Savannah,
Ga
7, 059. 74
7, 641. 33
Marine hospital, New Orleans, La
885. 26
Survey of salt marsh areas,
~ South Atlantic and Gulf
States
:.
1,610. 29
1, 083.94
1, 734.84
Total
2,188,128. 86 2, 067, 386. 85 2, 000,813. 56 2,195, 203. 53 2,176,731. 38
J Appropriation accounting not done by Division of Supply.
. «Includes receipts frora sales of customs forms (reimbursed to the appropriation) and certain expenditures for printing and binding from appropriations other than printing and binding.
»Included in appropriation for printing and binding.
243
SECEETAEY OF THE TEEASUEY
Expenditures by Division of Supply, fiscal years 1925-1929, hy appropriations—
Continued
Bureaus and offices, and titles of
appropriations
Supervising Architect:
Repairs and preservation of
public buildings
_
Mechanical equipment • for
public buildings
Vaults and safes for public
buildings
General expenses of public
buildings
_
Furniture and repairs of same
for public buildings _
Operating supplies for public
buildings.
Total
Bureau of Internal Revenue: Collecting the internal revenue..—
Bureau of Prohibition: Enforcement of narcotic and national
prohibition acts *
Public debt service:
Expenses of loans (act Sept.
24, 1917, as amended and
extended)
Public debt service..
Total
.- . .
Treasurer of the Uriited States:
Repairs to canceling and cutting machines
1927
1929
1925
1926
$102,176.61
$101,089.89
$109,039. OI-
87,493.86
96,-140.22
OI, 730. 90
59,971. 69
70,980. 62
49,196. 71
100,310. 02
12,981. 63
13,567. 59
27,625.56
.33,705.-64
46,924.19
656,379. 79
554, 955. 75
534,303. 43
619,069. 99
874,740. 96
1,212,801.10
1,161,803.45
1,100, 269. 29 1,097,299. 34
1,114,359.98
3928
$104,..692.::86
$119,680*30
lOUim'M' • 105; 392; 15
84,689. 83
2,056,087. 46 2,345,787. 41
2,031,804. 68 1,998,537. 52
1,912,164. 90
369,278.26
194,899. 85
194, 086.16
235,890. 74
194,449. 29
174,135.48
133, 092. 76
212,828. 37
226,267. 08
145,194.94
3,940. 36
45,699. 65
7,214.13
33,521. 26
3,632. 68
36, 506. 44
27,182. 47
23,066.11
3,168. 57
28,224. 80
49, 640. 01
40,735. 39
40,139.12
50,248. 58
31,393. 37
67.95
"
T o t a l appropriations
and allotments
Purchases from appropriations
from which no allotments were
made *
Grand total
5, 577,763. 24 5,276,985.12
68,r980.;00.
132,147. 66
5, 646, 743. 24 5,409,132. 78
6,122,899. 48
41,269.26
•
6,549,879.12' 6,813,886.08
167,* 144. 50
96; 693. .86
6,164,168. 74 .6,6.57,023. 62. 6,'910,479:'94
• Under supervision of Commissioner of Internal Revenue prior to fiscal year 1927.
' Appropriation accounting for these purchases was done by bureaus and offices for which the purchases
were made.
The foregoing expenditures involve the examination and audit for
payment through the disbursing clerk of the Treasury Department
of 103,243 vouchers in 1929 and 94,402 in 1928, an increase of 8,841.
The possible cash discounts for prompt payment of bills aggregated
$30,908.39 and $19,607.50 in 1929 and 1928, respectively, of which
only $335.40 in 1929 and $319.35 in 1928 were lost, due generally to
failure of vouchers requiring certification by field officers to reach the
division for approval for payment within the discount periods. The
increase in cash discounts saved to the department during 1929, over
the amount saved in 1928, was $11,285.84, while the total a-mount
lost was approximately 1 per cent of the possible total.
Formal purchase orders to the number of 42,171 were placed b}^
the division during the fiscal year 1929, compared with 40,700 in the
preceding fiscal year. These figures are exclusive of 4,844 quarterly
and annual contracts made to purchase ice, wood, coal, fuel oil, subsistence .supplies, etc., in 1929, and 4,624 similar contracts for the
244
REPORT ON THE FINANCES
fiscalyear 1928. The 42,171 purchase orders required the preparation
and circulation among approximately 100,000 prospective bidders of
7,272 sets of specifications and invitations for proposals in 1929, as
against 7,408 in 1928, or a decrease of 136.
The practice of routing shipments of supplies ordered by the division and also by other activities of the department has been continued.
In the forwarding of shipments by freight, parcel post, or express,
routings which,yield the lowest rates are determined in advance and
prescribed for such shipments. During the fiscal year 1929, 27,576
shiprnents for the various activities of the department were routed by
the traffic section of the division.
Stationery supplies
The appropriations, reimbursements, and expenditures for articles
of stationery for the past five years are summarized in the following
table:
Appropriations, reimbursements, and expe7iditures for stationery, fiscal years
'
1925-1929
Appropriation
Reimbursements
Available credits
Total expenditures
Balance . .
1925
1926
1927
1928
1929
$350,000.00
83,332.85
$437,760.00
67,440. 52
$480,000.00
15,110.04
$470,000.00
16,166. 25
$420,000.00
13, Oil. 00
433, 332. 85
426, 285. 29
505, 200. 52
436,405.17
^ 495,110.04
458,556.57
486,166. 25
446,043. 39
433, Oil. 00
432, 741.00
7,047. 56
68,796.35
36,553. 47
40,122.86
270.00
The value-of stationery supplies issued to each bureau, office, and
service of the department during each of the last five fiscal years is
shown in the following table:
Issues of stationery supplies to bureaus, offices, and services of the Treasury
Department, fiscal years 1925-1929
B u r e a u , office, or service
Secretary, Undersecretary, a n d Assistant
Secretaries
Appointments Division...
B o a r d of T a x Apipeals...".-'..
. Divisioji of Ep.p.kkeepiDg a n d W a r r a n t s
B u r e a u of E n g r a v i n g a n d P r i n t i n g
B u r e a u of t h e B u d g e t
Division of S u p p l y
General S u p p l y Committ.ee
Chief clerk a n d s u p e r i n t e n d e n t
Division of A c c o u n t s a n d Deposits
C o m p t r o l l e r of t h e C u r r e n c y
C o n t i n g e n t expenses, n a t i o n a l c u r r e n c y
C u s t o d i a n s of p u b l i c buildings
C u s t o m s Service
Collector, S a n J u a n , P . R .
D i s b u r s i n g clerk
Division of D e p o s i t s . .
F e d e r a l Farm" L o a n B o a r d
Federal Reserve B o a r d
Government actuary
1925
1926
1927
476.21
6,192. 02
679. 55
2,783. 81
4, 235. 52
1, 057. 99
99.93
7,961. 47
334. 23
2,048.75
67, 686. 75
$1, 630. 22
474. 80
5, 209. 33
481.67
7,863, 68
667. 36
2,914. 29
936. 56
1, 364. 34
117. 29
7,821. 33
50.33
2, 031. 57
67, 099. 34
$1, 617. 03
675. 52
3, 452. 37
514. 77
8, 227; 46
543. 20
2,358.03
707. 75
1, 629. 29
643. 24
8, 541. 22
36.56
1, 732. 77
63,138. 35
675.00
119. 69
2,610.35
5, 000. 57
5.86
551.19
155. 36
2, 282. 42
,3,547.07
9.58
$1,575. 06
941.49
1928
.1929
723.51
$1, 042. 38
626. 39
136.50
1,096. 25
6,924.79
358. 28
6,885.96
. 1,020.76
1, 757. 38
1, 027. 06
5, 429. 24
51.41
1, 627. 69
72,030.83
806. 85
571. 29
$1,026. 37
430. 62
. 162.82
1,718.58
7,187.14
634.12
2,886. 27
1,119. 27
1,654. 20
430. 76
6,712. 82
64.08
1, 407. 81
66,425. 59
722. 90
778.48
2, 422. 03
4, 209. 63
15.38
3,979.86
4, 249. 95
14.15
3, 681. 73
3,977. 02
23.48
'
245
SECEETARY OP THB TEEASTJEY
Issues of stationery supplies to bureaus, offices, and services of the Treasury
Department, fiscal years 1925-1929—Continued
Bureau, office, or service
1926
1928
1929
Insolvent national-bank fund
Internal Revenue Bureau
Mint Bureau_
National bank examiners
National Bank Redemption Agency
Printing division
Prohibition Bureau
Public Debt Service
Expenses of loans
Public Health Service
Secret Service
Supervising Architect
Treasurer of the United States
€oast Guard
_
_
War Finance Corporation
Expended for transportation (partly estimated)
$919. 66 $1,017.80. . $1, 023. 77 - $884.05
$920.97
202,179.89. 233,878. 04 203, 234. 04 195,135:01 191, 511. 70
1,134. 70
921. 76
943. 22.
962. 96,
1, 284. 48
1,473.24
2, 065. 72
1, 737. 42
1, 315.10
1, 414. 68
2, 004. 71
1, 686.13
1, 303. 31
1, 689.97
1, 666. 92
128.47
177. 79
(0
(0
(0
47, 911. 64 27, 738. 50
50, 420. 09
23, 545. 90 23, 508.17 48,058. 81 20, 581. 34 46,973.39
20,
025. 07
25, 583.17
2, 564. 77
203.06
15,327.47
16,443. 31 16,344.10 22,120. 62
21,703.
45
845. 54
823. 51
588.82
929. 27
1, 001. 47
4, 002. 54
7,425. 29
4,755.34
6, 338. 75
8,481.
09
8, 304. 21 10, 395.03
8,791. 39
9,678.39
8,175.67
.24, 520.08 25,172. 03 26,909.04
25,640.16 •' 27,709.
58
5.00
50.69
71.40
12.84
14. 67
20,000.00
20,335. 68 20,010.70
Total
Reimbursed from other appropriations..
Total charged to stationery appropriation
437,256. 01 453,224. 24 463,666.67 468,534.43
83,332.85' 67,440. 52 15, no. 04 16,166.25
353, 923.16
385,783.72
448,556.63
452,368.18
451,326. 27
13, Oil. 00
438, 315. 27
1 Included in Division of Supply.
A summary of changes in the value of stocks of stationery supplies
for the past five fiscal years is shown in the following table:
Changes in value of stocks of stationery supplies, fiscal years 1925-1929
1925
On hand at beginning of fiscal year
Purchased during year
TotaLAdd value of stationery articles received
from various divisions as surplus for
reissue
Less value of stationery articles transferred
to General Supply Committee as surplus
Value available for issue
Issues during year
On hand at end of year
Inventory value June 30 1
Inventory value July 11
1926.
1927
' 1928
1929
$155,290. 37 $162,070. 26 $157, 399. 28 $162,367.96 $132, 742. 06
426, 285. 29 436,405.17 458, 556. 57 446,043. 39 432,741. 00
581, 675. 66 698,475. 43 615,955. 85 608,411.35
17,983.72
9,851.13
17,385. 40
20,993. 59
599, 559. 38 608,326. 56 633, 341. 25 608,411.35
3,519.08
565,483.06
586, 476. 65
880. 00
599, 559. 38 604,807. 48 633,341. 25 607, 531. 35 586,476.65
437, 256. 01 453, 224. 24 463, 666. 67 468, 534. 43 451, 326. 00
162,303. 37 151, 583. 24 169,674. 58 138,996. 92 135,150. 65
162, 303. 37 151, 583. 24 169,674. 58 138,996. 92 135,150. 65
162,070. 26 157,399. 28 162, 367. 96 132, 742. 06 131,665. 37
»Inventory values are r.eadjusted July 1 of each year in accordance with new prices on contracts effective
on that date, and invoices are based on replacement costs at dates of shipment.
Shipments of stationery and miscellaneous supplies from the warehouse of the Division of Supply in Washington to field offices were as
follows:
240
REPORT ON THE FINANCES
Shipments and inventories of stationery supplies, fiscal years 1927-1929
1927
Packages
1929
1928
Weight
Packages
Weight
Packages
Weight
•
stationery and miscellaneous supplies:
Freight and express , . . . . . .
Parcel post..
Franked parcels
Blank books and forms by mail
Total shipments
Government bills of lading used for
freight and express shipments
8,468
1,784
4,697
69,750
Pounds
1.223,738
21,560
13,791
545,000
10,479
2,046
5,408
81,410
Pounds
1,284,289
24,657
16,224
895,395
il, 883
1,566
7,367
57,805
Poundtt
1,372, 772
21, 556
22,101
783,725
74,599
1,804,089
99,343
2,220, 565
78,621'
2,200,153
2,911
3,649
3,393
Printing andbinding
The appropriation for printing and binding for the fiscal year 1929'
was $715,000, of which $712,099.28 was expended and $2,900.72 reverted to the Treasury. To these expenditures should be added
$45,639.19 reimbursed from sales of customs forms and $34,895.98expended from other appropriations. Thus there were total expenditures of $792,634.45 for all classes of printing and binding handled
through the Division of Supply.
Expenditures for printing and binding, by bureaus, offices, and
services for each of the last five fiscal years are shown in the following
table:
Appropriations, expenditures, and reimbursements for printing and binding, fiscal
years 1925-1929 ^
SUMMARY
1925
1926
1927
. 1928
1929
Appropriation, printing' and binding,
Treasury Department.
^
$850,000.00 2$834,750.00 2$835,000.00 $820,000.00 $715,000.00
Reimbursements from sales of customs
45,639.19
39,159. 52 42, 616. 51 43, 573. 85 44, 085.18
forms..
_
31,873. 03 36,129. 43 30, 495. 85 62, 097. 88
34,895.98
Expended from other appropriations
Total available
Total expen<iitures
Balance
_
921,032. 55 913, 495.94 909,069. 70 926,183.06
. . 912,817. 43 884, 275. 95 788,641.70 892, 095. 22
795, 535.17
792,634.45
34,087. 84
2,900. 72
8, 215.12
29, 219.99
120,428.00
E X P E N D I T U R E S F R O M A P P R O P R I A T I O N FOR P R I N T I N G AND BINDING, BY
BUREAUS, OFFICES, AND DIVISIONS
Secretary, Undersecretary, and Assistant
Secretaries..
$6,938.77 $10,084. 21 $12, 964. 76 $13, 737. 30
1,457. 94
Appointments Division
1,293. 68
674. 29
1, 210. 78
Bookkeeping and Warrants Division
•.. 17,144. 45
8,957. 94 18,919. 53 11, 541. 61
Bm-eau of Engraving and Printing
7, 500.17
6,454. 77
5, 723. 40
7,185.81
Bureau of Prohibition 3
71, 315. 06
59, 277.14
4, 618. 44
Division of Supply.
3,998. 46
7, 728. 87 30,141. 79
General Supply Committee
23,424. 38 27,147. 50 29, 885.11 36, 005. 28
Chief clerk and superintendent
1, 623. 94
1, 382. 57
1, 331.46
1, 641. 78
183. 34
61.31
Commissioner of Accounts and Deposits...
123.39
123.55
Committee on enrollment and disbarment.
30.61
49.16
Comptroller ofthe Currency
23,618. 36 24, 356. 31 28,922. 67 27, 952. 32
1,002. 08
2, 306. 81
1, 259. 27
1,805.13
Custodians of public buildings
i
1 Figures subject to slight variations, due to necessary delays in receiving bills from the Public
certain items until pending work is completed after the close of each fiscal year.
2 Exclusive of $82,500 available for 1926-27 (44 Stat. 868), which was not expended.
8 Included under Bureau of Internal Revenue prior to 1927.
$11,899.00
946. 4323, 747. 91
7, 753. 4050,888.98
17,152.10
27, 691. 01
1,005. 28
82.95
23, 764. 88
1,393. 35
Printer for
247
SECEETAEY OF T H E TEEASURY
Appropriations, expenditures, and reimbursements for printing and binding, fiscal
years 1925-1929—Continued
EXPENDITURES
F R O M A P P R O P R I A T I O N FOR P R I N T I N G AND
B U R E A U S , O F F I C E S , A N D DIVISIONS—Continued
Customs:
Bureau
Service..
Special agency
D i s b u r s i n g clerk
Division of D e p o s i t s .
Federal F a r m Loan Bureau
Government actuary
Internal Revenue:
Bureau
P r o h i b i t i o n enforcement
Service
L o a n s a n d C u r r e n c y Division ^
Mint:
Bureau
Service..
N a t i o n a l - b a n k depositaries
P r i n tine: division
P u b l i c D e b t Service *
Public Health:
Bureau.
_
Service
.. .
Register of t h e T r e a s u r y *
Secret Service
Supervising A r c h i t e c t
T r e a s u r e r of t h e U n i t e d States
Coast G u a r d :
Bureau..
Service.M a t e r i a l s for b o o k b i n d e r
_
Miscellaneous
B I N D I N G , BY
1928
1929
1925
1926
1927
$5,486. 27
35,598. 33
830.15
804.17
61.59
3,132. 43
1, 775. 89
$5, 481.10
42, 563.90
839. 81
712. 29
44.48
$5, 531. 28
34,089. 02
1,389.86
530. 36
29.96
1, 719.19
1, 570. 86
33,830. 92
62, 978. 04
._ 386,836. 61
2, 232. 90
64, 794. 81
54, 241. 58
341, 576. 22
2,435. 43
65,991. 04
86, 777.77
1
179, 002. 79
2, 640. 58
211,310. 33
2, 814.17
1
3,416. 34
2,159. 41
2, 817. 27
202. 92
22,127. 79
3,406. 92
2, 584. 86
3, 273. 00
516. 39
20, 361. 39
3, 337. 25
2,516.82
2,120. 98
180. 22
24,036. 20
88, 387. 01
2, 432.16
679. 48
406. 61
• 2,371.11
13,020. 72
76, 854. 90
4, 3.59. 27
713.08
295. 33
2,765.24
11,167. 76
103,650.52
4,182.11
327. 95
5,876. 49
11,908.81
382.91
3,041.80
12,966.83
11, 407. 51
19, 510. 54
14,677. 24
18,477.33
23,824. 35 1 8 25, 717. 73
22, 378.10
51, 225. 74
11,985.41
22,160.93
256. 48
46, 374.47
62,902. 52
53,847. 64
75, 787.48
841, 794. 88
805, 530. 01
714, 572. 00
785,912.16
712, 099. 28
Total
$4,066. 58
35,968. 54 [7 $34,622.88
434.69
230.49
649. 69
(8)
1,603. 24
1, 652. 28
^9263,655.90
3, 662.18 1 »5,75L94
2, 940.12
2,019.04
2, 561. 54
(«)
20,000.68
(«)
15, 848.86
88,129.44 }» 102,264.76
8,107. 57
(5)
503.93
6, 658. 29
.11,109.45
(*)
R E I M B U R S E D AND E X P E N D E D F R O M O T H E R A P P R O P R I A T I O N S
Agricultural C r e d i t C o r p o r a t i o n .
B u r e a u of E n g r a v i n g a n d P r i n t i n g . _
Collecting t h e r e v e n u e from c u s t o m s
C o n t i n g e n t expenses, national c u r r e n c y
C u s t o m s Service b l a n k forms «
E x p e n s e s of loans (act Sept. 24, 1917, as
a m e n d e d a n d extended)
Expenses, s e t t l e m e n t w a r claims, act 1928
F e d e r a l farm loan b a n k s
Federal F a r m L o a n B u r e a u (miscellaneous
expenses)
I n s o l v e n t - n a t i o n a l b a n k fund
. .
Internal Revenue Bureau
M i x e d C l a i m s Commission
National bank examiners.
N a t i o n a l B a n k R e d e m o t i o n Agency
N a t i o n a l Sesquicentennial E x h i b i t i o n
P u b l i c D e b t Service
World W a r Foreign D e b t Commission
E n f o r c e m e n t of narcotic a n d national proh i b i t i o n acts
Total..
$724. 21
$20. 65
2,803.68
$340.05
869.44
39,159. 52
749.14
42, 616. 51
1, 254. 59
43, 573. 85
$1, 582. 99
17. 56
3, 562.08
44,085.18
$2, 398. 39
55. 50
666.75
45, 639.19
5, 828. 91
24, 249. 84
3,117. 63
136.13
252. 68
671. 59
687. 32
3, 734. 37
2, 247. 05
2, 737. 36
3,156. 02
6,440.16
2, 393.18
10, 564.91
1,601.33
12,404. 44
11, 202.82
1, 629. 61
10, 337.13
2, 520. 42
i2, i82. 61
11,630.46
151.39
12,130.68
3,930.61
20.00
3, 614. 05
39.00
666. 08
2, 595.45
7, 729. 73
12,190.48
3, 994. 06
3. 359. 01
157. 97
142.66
71, 032. 55
78, 745. 94
74, 069. 70
106,183. 06
80,535.17
* Public Debt Service includes Register of the Treasury, for 1927, 1928, and 1929, and the greater part of
Loans and Currency Division for all years.
* Included in Division of Supply.
« Reimbursed to printing and binding appropriation.
'' Includes bureau, service, and special agency.
,
8 Combined with Commissioner of Accounts and Deposit'^.
»Includes bureau and service.
Postage
The expenditures for postage for the fiscal year 1929 to prepay
matter addressed to Postal Union countries and for postage for the
Treasury Department were as follows: For postage stamps for de
248
REPORT ON T H E FINANCES
partment use, $745; for transmission of matter addressed to Postal
Union countries through the Bureau of International Exchanges,
$209.50; for publications mailed, by the Superintendent of Documents
for the department, $32.26; a total of $986.76, leaving an unexpended
balance of $13.24.
Department advertising
Authorizations to publish advertisements were issued to 3,207
newspapers and periodicals in the fiscal year 1929, compared with
3,027 in 1928, an increase of 180; while expenditures thus authorized
decreased from $25,884.62 in 1928 to $24,363.67 in 1929, a saving in
expenditures of $1,520.95. Careful'auditing of claims for the foregoing expenditures prior to payment resulted in disapprovals of
$360.88 in charges.
Engraving work
A total of 55,937,976 engraved forms were approved by this office
for execution by the Bureau of Engraving and Printing for the several
departments and establishments of the Government during the fiscal
year 1929, compared with 48,411,232 in the preceding year. The
following table gives the quantity of each class of forms constituting
these totals:
1928
Class
Checks
.Drafts
Warrants
Commissions..
Certificates
Transportation requests
Liquor permits
-
^_.
_
_
_
_ _
Total
1929
31,925,160
3,000
250,400
62,650
3,521,697
766,425
11,881,900
32,246,905
14,800
223,541
36, Oil
3,143,669
1, 737,450
18,535,700
48,411,232
55,9o7,976
General Supply Committee
A summary of the transactions of the General Supply Committee
for the fiscal years 1927, 1928, and 1929, will be found in the following
table:
Summary of transactions of the General Supply Committee for the fiscal years 1927^
1928, and 1929
1927
1928
1929
1929 compared with
1928, increase (+)
or decrease
(-)
Purchases from General Supply Committee contractors
$7, 506,923. 41 $8,835, 799. 40 $9,145; 832.43 +$310,033.03
Receipts from disposition of surplus property:
Auction sales
65, 258.13
96, 739.80
46, 323. 47 —50,416 33
Contract sales
_
79,190. 92
47,141. 73
90,329.12 -f 43,187.39
Transfers to Government activities
.^-.
33,085. 62
44, 267. 72
16,804. 39 —27,463. 33
Total.
..:
177, 534. 67
188,149. 25
153,456.98 -34,692.27
Grand total
.
..
7, 684,458. 08 9, 023, 948. 65 9, 299, 289. 41'-4-275 340 76
249
SECRETAR,Y OE T H E TREASUR.Y
Inasmuch as there was no general increase in the cost of commodities, the increase in the purchases represents an increased
consumption.
The activities of the General Supply Committee are summarized in
the following tables:
Value of purchases reported by executive departments under contracts negotiated by
the Secretary of the Treasury through the General Supply Committee, fiscal years
1925-1929, by classes
Class No.i
1925
1
2
.
3....
4
5...:
6
7
8
9
10
11 .
12
13
14
15
16
17
18
19.....
20
21
Total - -
.
1926
1927
1928
$869,003. 38
113,113. 63
245,870. 79
105, 523. 69
111, 470. 86
194,093. 22
230, 667. 23
159, 860. 70
859.060. 67
445,897.01
121, 599. 64
259,412. 90
3,863.47
16, 784. 68
805, 073. 74
1, 546. 47
151,972. 75
969, 308. 68
488, 564. 46
492, 507. 67
$860, 650. 96
134, 354. 67
314.542.71
106, 719. 49
118, 689. 42
185,063. 50
233, 224. 35
233,751.49
764, 243. 55
575,135.43
124, 608. 39
254, 731. 02
4, 312.42
20, 649. 20
718, 717. 03
1, 513. 03
485, 911. 78
665, 294. 70
463, 593. 34
459,893. 87
$1,061, 239.13
159, 282.15
227,621.29
82,147.46
82,866. 60
245,273.92
319, 628. 68
258,115. 25
985, 528. 50
518, 680. 39
119, 322. 63
324,734. 73
3, 946. 56
17,198.46
742, 568. 22
1,698.92
485,966. 53
930, 583.00
462,719. 56
477,801. 43
$869, 388. 99
245, 242. 94
260,920. 31
90, 996. 39
87, 355. 32
297, 926.12
349, 708. 43
396,045.01
953, 572. 00
733, 671. 30
139, 800. 50
287, 500. 93
3,144.17
25, 270. 63
740,061. 64
972.47
1,041,051.47
1,158,713.99
639,039. 86
515,416.93
6, 645,195. 64
6,725, 600. 35
7, 506,923.41
8,835, 799.40
1 Class
1.
2.
3.
4.
5.
6.
7.
1929
$1,093,098.34
359, 502. 36
432,863. 78
166, 371. 37
126,069. 69
408, 281.44
459,862. 27
408, 543.81
1,157,423. 72
823,467.41
227, 388.86
370,126. 38
3,887. 27
22, 892. 21
805,192. 50
569. 52
387, 604. 58
996,039. 78
528,493. 58
503, 256. 92
18,353. 62
9, 299, 289.4l'
No.—
,
Stationery, paper and paper articles, drafting supplies, and school supplies.
Hardware, metals, brief cases, hand bags, leather goods, and shoe findings.
Dry goods, flags, wearing apparel, boots, shoes, slippers, window shades, and cordage.
Drugs, medicines, and chemicals.
Laboratory apparatus, hospital appliances, and surgical instruments.
Electrical, engineering, and plumbing supplies.
Lumber, millwork, excelsior, sawdust, packing boxes, building materials, slag, stone, and asphalt
oil, and tar for road building.
8. Brushes, glass, lubricants, fuel oils, paints, and painters' supplies.
9. Furniture and floor coverings.
10. Groceries, provisions, cleaner, polish, floor wax, scouring compound, soaps, soap dispensers,
meat, fish, lard, oleomargarine, and household supplies.
11. Feed, forage, and seed.
12. Photographic supplies, meteorological apparatus, microscopes, surveying instruments, and
meat-inspection supplies.
13. Engraving, printing, and lithographic supplies (excluding supplies for the Government Printing
'Office and the Bureau of Engraving and Printing).
14. Ice.
15. Incandescent electric lamps.
16. Incandescent gas-lamp supplies.
17. Automobile accessories, motorcycles, tires, and tubes.
18. Computing, addressing, dictating, duplicating, folding, sealing, and typewriting machines;
labor-saving devices; exchange typewriters, repair parts, and equipment.
19. Electric service.
20. Telephone service.
21. Athletic supplies and playground equipment.
NOTE.—The value of purchases, by classes, for earlier years is shown in the following reports: 1913 to
1918. in 1921 report, page 488; 1919 to 1924, in 1928 report, page 234.
250
REPORT ON T H E FINANCES
Receipts from surplus and salvaged materials disposed of by General Supply
Committee, fiscal years 1921-1929
Fiscalyear
1921
1922
1923
1924
1925
1926-.
1927
1928
1929
Contract
sales 1
^ ^ £ ^
.
$20,186.32
79, 595.35
114, 492. 74
179, 613. 00
63,112. 81
83,310.32
65, 25S. 13
96, 739. 80
46, 323. 47
Total
Transfers
$3,230.45
138,129.25
130, 390. 40
165, 972. 77
130, 929. 07
79,190. 92
2 47,141.73
90,329.12
$989,234. 25
685, 097.35
324,376.77
150, 002. 96
78,028. 61
48,450. 84
33,085. 62
44,267. 72
16,804. 39
$1,009,420.57
767,923.15
• 576, 998. .76
460,006. 36
307,114.19
262, 690. 23
177, 534. 67
188,149.25
153,456.98
1 Includes estimated amounts of $75,000 in 1923 and 1924, and $80,000 in 1925, and actual amounts of
$50,633.58 in 1926, $29,704.41 in 1927, and $23,029.36 in 1928, received from the sale of waste paper from the
various departments, the receipts for which do not pass through the General Supply Committee but are
paid direct to the selling services and deposited in the Treasury by them.
»$90,329.12in 1929 includes $849.65 for waste paper collected by the District of Columbia government.
Number of specifications mailed by the General Supply Committee, bids received,
contracts entered into, items on which awards and no awards were made, and
samples received and retained, fiscal year 1929
Sets of <
specifica- B i d s retions
ceived
mailed
Class N o . i
1
2.3.4,
5._
6
7_8-9-10-11__
12-13.14__,.
15...
161718.
19-_
20
21Total
_
. . .
.
. . -.
7,200
850
6,500
550
525
725
475
2,400
550
8,800
350
325
135
20
55
10
750
310
30
-.-.
30, 560
1 See titles of classes on preceding page.
306
103
230
50
72
91
49
83
69
578
45
56
13
2
7
1
84
52,
1
1
6
1,899
Contracts
Samples
received
Number
Award
items
Samples
retained
No
award
items
2,818
2,692
2,137
1,105
1,170
1, 645
822
792
1,554
834
462
2,017
63
31
105
57
445
1,402
39
94
60
752
331
438
22
325
159
19
92
255
842
18
59
50
83
86
141
76
103
102
103
10
71
124
28
83
13
68
34
14
12
4
136
168
66
121
34
51
56
36
56
38
234
27
42
10
3
5
1
33
49
1
1
8
56
5
13, 786
1,040
20, 344
3,520
1,058
3,406
1,052
2,180
83
1,009
636
138
567
666
3,372
40
126
82
8
246
39
251
SECEETAEY OE THE TEEASUEY
'Siatem.ent of surplus property received and issued by the General Supply Committee,
by departments and establishments, fiscal year 1929
Receipts
(invoice
price)!
Department or establishment
.Agriculture Department
Botianic Gardens
•Commerce Department
District of Columbia
•Federal Board for Vocational Education..
Federal Trade Commission
• General Accounting Office
Government Printing Office
_
House of Representatives
.Interior Department
Interstate Commerce Commission
Justice Department
Labor Department
-Library of Congress
National Advisory Committee for Aeronautics
-Navy Department...
. .
.'Pan American Union
Post Office Department
Public Buildings and Public Parks
:Smithsonian Institution
-State Department.__
:
Treasury:Department. -:•
•U. S. CivilService Commission
V. S. Railroad Administration
U. S. Shipping Board
U. S. Senate
'JJ. S. Tariff Commission
U. S. Veterans' Bureau
1
War Department
"White House
$1,191.50
40,098.44
3,305.73
4.34
. . ..
_
Total
Issues
Cost 2
$3,362.;86
65.10
777.09
1,494.08
Charge 3
$2,643.31
59.60
725. 09
1,353.89
.50
.50
26.50
359.13
3, 315.94
297.87
1,166. 31
111.00
100.50
2.00
42.36
120.00
163.90
69.70
76.50
1,322. 65
3,194.45
4.20
19.87
345. 63
3, 270.43
226.99
1,166. 31
111. 00
87.50
1.50
38.49
90.00
151. 55
57:95
61.25
1,317.47
2,707. 41
4.20
987.66
21,865. 64
61, 788.81
.40
16.00
153. 00
1,422.30
924.00
106.00
.40
12.00
114. 75
1, 297. 80
885. 00
5150
198,037. 47
18,694.34
250.00
12,708.89
3, 240. 03
1, 457.60
12, 492.91
1,482.38
1,891.08
369. 65
16,709.64
88.00
9,865.00
3,828.10
4,418.07
16,804.39
» Original cost (invoice price) of surplus property received from departments by the General Supply
Committee.
3 Original cost, as shown by transfer invoices, of surplus property issued to departments.
n Sales price of surplus property issued to departments.
.Recapitulation of surplus property stores account of General Supply Committee,
July 1, 1928, to June 30, 1.929
Balance of stores-as of June 30, 1928
'
$32,519. 10
Transferred to the General Supply Committee during the fiscal year
1929...:
198,037. 47
Total
.
--_
230, 556. 57
Net sales
.
.__.:
16, 804. 39
.Discounts allowed on above.
1, 889. 95
^ e t proceeds from auction sales
'.
46, 123. 32
Difference between invoiced value and proceeds from auction sales _ 136, 332. 19
TBalance on hand June 30, 1929—_._
.
29, 406. 72
Total
-
3^et decrease in stores during fiscal year 1929
.....__..
230, 556. 57
168, 630. 75
TREASURER OF THE UNITED STATES
The total ordinary receipts from all sources, exclusive of postal
revenues, during the fiscal year 1929, on the basis of daily Treasury
statements, revised, were $4,036,218,918.67, a decrease of $2,016,593.81, as compared with those for the fiscal year 1928. The cash
expenditures chargeable against ordinary receipts amounted to
$3,848,413,287.11. The net result for the fiscal year was an excess of
$187,805,631.56 of ordinary receipts over total expenditures chargeable against ordinary receipts.
The postal revenues deposited in the Treasury and credited to the
account of the Post Office Department during the fiscalyear 1929
amounted to $733,530,053.53.
. Receipts from tolls, etc., for movement of tonnage through the
Panama Canal during the fiscal year 1929 were $28,131,447.24 as
compared with $28,134,345.42 for the previous year. Disbursements
made on account of the canal, exclusive of fortifications, on the basis
of warrants drawn were $9,970,913.25 for the fiscal year 1929 as
against $10,659,442.27 for the fiscal year 1928.
The receipts and expenditures on account of the principal of the
public debt during the fiscal year 1929 are shown in the foUowing
statement:
Receipts on account of—
Certificates of indebtedness
$4, 637, 488, 200. 00
Treasury notes and certificates of indebtedness (foreign
service retirement fund series)
'
377, 000. 00
Treasury notes (adjusted service series)
:.
127, 700, 000. 00
Treasury notes and certificates of indebtedness (civil
service retirement fund series)
33, 000, 000. 00
Treasury bonds
._
359, 042, 950. 00
Treasury savings securities
10, 015, 227. 37
Postal savings bonds
.
2, 074, 800. 00
Deposits for retirement of national bank notes (act of
July 14, 1890)
--..-24,643,555.00
Total
Expenditures on account of—
Certificates of indebtedness
Treasury notes and certificates of indebtedness (foreign
service retirement fund series)
Treasury notes and certificates of indebtedness (adjusted service series)
Treasury notes
252
5, 194, 341, 732. 37
4, 240, 026, 700. 00
27, 000. 00
16, 500, 000. 00
184, 950, 050. 00
SECRETARY OF THE TREASURY
Expenditures on account of—Continued.
Treasury bonds
l-__.
War savings securities.
Treasury savings securities
. First Liberty bonds
Second Liberty bonds
Third Liberty bonds.._..
.
Fourth Liberty bonds
Victory notes
.
Otlier debt items
1
National-bank notes and Federal reserve bank notes
Total
.
Excess of expenditures
.
_•__.
253
$12, 695, 000. 00
56, 429. 75
140, 999, 067. 45
5,250.00
23, 142,650. 00
1, 208, 395, 200, 00
15, 684, 050. 00
49.6, 950.,00
109,•944.^0
24, 346, 256. 50
5, 867, 434, 547. 70
673, 092, 815. 33
The retirements of the debt were effected as follows:
From—•
Cumulative sinking fund
S370, 277, 100. 00
Purchases and retirements from foreign repayments. __ ,
571, 150. 00
Amounts received from foreign Governments under
debt settlements
.
..
175, 642, 350. 00
Amounts received for estate taxes
20, 000. 00
Purchases and retirements from franchise tax receipts
(Federal reserve and Federal intermediate credit
banks)
2, 933, 400. 00
Forfeitures, gifts, e t c . .
159, 703. 75
Total.
.
Surplus of ordinary receipts applied to public debt retirements
^..
Total
._
549, 603, 703. 75
123,489, 111. 58
673, 092, 815. 33
There was a slight increase in the gold holdings of the Treasury
during the fiscal year. The amount of such holdings on June 30, 1928,
as shown by daily Treasury statements, revised, was $3,215,615,888.92
and on June 30, 1929, $3,278,368,764.49, a net increase of $62,752,875. 57. The imports of gold during the fiscal year were $267,427,977 and the exports $112,291,393. Set apart for the respective uses,
the gold was held on the following accounts:
For redemption of gold certificates outstanding
Gold fund. Federal Reserve Board
Gold reserve
.
Goldin general fund
Total
,
Sl, 384, 335, 199. 00
1, 562, 425, 579. 40
156, 039,088. 03
175,568,898.06
----
3, 278, 368, 764. 49
Of the amount shown in the general fund, $168,871,032.57 was held
for the redemption of Federal reserve notes.
The balance in the gold fund of the Federal Reserye Board at the
close of the fiscal year 1928 was $1,387,650,413.30. During the fiscal
year 1929 deposits were made therein aggregating $1,441,351,361.39,
254
REPORT ON THE FINANCES
and withdrawals therefrom amounted to $1,266,576,195.29, leaving a.
balance on June 30, 1929, of $1,562,425,579.40.
Public moneys on deposit in designated Government depositaries^,
exclusive of items in transit, on June 30, 1929, amounted to $421^"337,007.16, distributed as. follows:
Depositaries:
In Federal reserve banks and branches
In special depositary banks
In foreign depositary banks.
In general and limited depositary banks
J n insular depositary banks
In Philippine treasury
Total
.-
-
.
.
,
$35, 891, 389. 40
356, 841, 912. 95
1, 599, 620. 25
25, 799, 065» 09
203, 964. 06
1, 001, 055. 41
421, 337, 007. 16
During the fiscal year 1929 interest accrued on balances held by
general, liihited, foreign, and insular depositary banks amounting to
$506,295.69 and on balances in special depositary banks arising from
the,sales of bonds, notes, and certificates of indebtedness amounting
to $3,909,926.49, making a total of $4,416,222.18.
Funds aggregating $120,293,170 were transferred by wire through
the Federal reserve banks and branches to general and insular depositary banks and to the Philippine treasury to restore balances depleted
by cashing Government checks and warrants during the fiscal year
1929, as against $117,456,764 during the fiscal year 1928.
United States bonds to the amount of $666,199,140, pledged to
secure national-bank note circulation, were in the custody of the
Treasurer at the close of the fiscal year 1929. United States bonds
and other securities held to secure public deposits in depositary banks
(not including special depositary banks) amounted to $48,058,700j
and securities held for the safe-keeping of postal deposits in postalsavings depositaries amounted to $186,349,472. Under provisions
of law, or by direction of the Secretary of the Treasury, the Treasurer
of the United States is custodian of several special trusts consisting
of bonds and other obligations to the amount of $11,291,088,411.ll^i.
The aggregate amount of the trust accounts is $12,191,695,723.11^T h e proceeds of currency counted into the Treasurer's cash by the
National Bank Redemption Agency during the fiscal year amounted
to $501,414,179.71. Of this sum, $481,598,238.50 was m national
bank notes, $430,431 in Federal reserve bank notes, $19,237,190 in
Federal reserve notes, and $148,320.21 in United States currency.
Payments for currency redeemed were made as follows: In Treasurer's checks, $303,671.49; by credits to banks for direct receipts in
the Treasurer's office, $23,761,163; by credits to Federal reserve
banks and branches in general account as transfers of funds for direct
remittances, $476,865,211.73; for remittances by meihbers banks,
$482,842.49; and by credits in other accounts, $1,291.
SECRETARY OF THE TREASURY
255
Canceled and uncanceled Federal reserve notes amounting to
$1,262,953,400 were received from Federal reserve banks and branches
for credit of Federal reserve agents. Such notes are settled for
between the Federal reserve banks and the Federal reserve agents
either directly or by adjustments in their redemption funds, and are
therefore not taken into the Treasurer's cash in the National Bank
Redemption Agency. The number of notes counted, sorted, and
delivered by the agency during the fiscal year was 190,770,271.
The number of pieces of paper currency issued directly by. the
Government (gold certificates, silver certificates, and United States
notes) during the fiscal year 1929 was 626,016,600 with a valuation of
$1,467,716,000 as against 697,620,300 with a valuation of $1,492,540,000
for the fiscal year 1928, a decrease of 71,603,700 in the number of
pieces and $24,824,000 in the amount.
Gold certificates outstanding on June 30, 1929, as shown by the
monthly paper currency statement, after deducting the amount
held in Treasury offices and Federal reserve banks, decreased
$84,154,620, Treasury notes $20,150, and United States notes $36,250,013, while silver certificates increased $2,496,463.
The shipments of United States paper currency from the Treasury
in Washington to Treasury offices. Federal reserve banks and
branches, and others during the fiscal year 1929 amounted to $1,597,485,441, as against $1,473,595,925 for the previous year. These
amounts include unissued stock shipped as reserve for joint custody
account amounting to $436,470,000 for 1929 and $308,496,000 for
1928.
During the current fiscal year the Treasurer's office authorized
and directed shipments or transfers of gold bars and of current gold,
silver, and minor coins, between the Treasury, the mints, the New
York assay office, and the Federal reserve banks and branches for
use in public disbursements and exchanges and for special purposes
to an aggregate amount of $169,962,660.03. Shipments of uncurrent
coins to the mints from the Treasury and from the Federal reserve
banks and branches were authorized in the amount of $8,354,874.95.
During the fiscal year 1929 funds requisitioned and advanced to
United States disbursing officers by accountable warrants aggregated $2,750,274,709.64, and Treasurer's checks issued on settlement warrants in payment of claims settled by the ComptroUer
General aggregated $87,359,500.77, which latter amoimt includes
claims for which drafts in foreign currencies were purchased at a
total cost of $18,812.51. Drafts in foreign currencies were also purchased for other departments and bureaus amounting to $63,424.35.
Accountable warrants aggregating $6,548,564,728.06 were also issued
reimbursing the Treasurer for public debt principal and interest
payments.
256
REPORT ON THE FINANCES
Checks drawn on this office by Government disbursing officers
were paid during the fiscal year 1929 to the number of 33,657,998, a
decrease of 757,508 checks as compared with the previous fiscal year.,
Balances to the credit of disbursing officers and Government agencies
in 3,062 accounts on June 30, 1929, amounted to $332,469,903.33, a
decrease of $30,673,931.91 in the total of such balances in 3,112
accounts on June 30, 1928. Payments to correct irregularities in
negotiation of checks were made to the number of 1,006 amounting
to $71,538.59, whUe in the previous year the number of cases was
1,116 for $72,398.77. Duplicate checks to the number of 8,979
were requested by payees or indorsers during the fiscal year as compared with 9,887 during the previous year.
WAR FINANCE CORPORATION
The War Finance Corporation has been in liquidation since January
1, 1925. By the act approved AprU 4, 1928, its charter was extended
for a period of one year, or until April 4, 1929. By the act approved
March 1, 1929, the liquidation of the assets remaining at the close of
April 4, 1929, and the winding up of the affairs of the corporation
thereafter were transferred to the Secretary of the Treasury, who for
such purpose was given all the powers and duties of the board of
directors of the corporation under the War Finance Corporation Act
of April 5, 1918, as amended. To carry out the program of liquidation, the Secretary of the Treasury, pursuant to authority contained
in the law, assigned to a liquidating committee the exercise and performance, under his general supervision and direction, of all powers
and duties vested in him by the act approved March 1, 1929.
On January 5, 1925, the corporation, with the approval of the
Secretary of the Treasury, canceled and retired at par $499,000,000
of its capital stock, leaving $1,000,000 outstanding. On AprU 5,
1929, by order of the Secretary of the Treasury, pursuant to authority
conferred by the act of March 1, 1929, $990,000 of the capital stock
of the corporation was canceled and retired at par, leaving $10,000
outstanding. On that date the corporation paid into the Treasury
$65,342,768.79, which represented the amount outstanding to the
credit of the corporation on the books of the Treasurer of the United
States, with the exception of $210,000, which latter amount consisted
of $10,000 capital and $200,000 working fund. The payment of
$65,342,768.79 into the Treasury represented $990,000 on account
of the cancellation and retirement of capital stock at par, and $64,352,768.79 on account of earnings of the corporation. In view of the
fact that the funds of the corporation are kept on deposit with the
Treasurer of the United States, this was essentially a bookkeeping
transaction and therefore did not increase the balance in the Treasury.
I t was accomplished by the delivery of a check for $65,342,768.79
drawn by the corporation on its account with the Treasurer of the
United States, and made payable to the Treasurer of the United
States.
The amount advanced by the corporation for all purposes, from its
creation in May, 1918, to AprU 4, 1929, was $690,431,100, of which
$688,232,000 had been repaid on that date. The amount carried on
the corporation's books on AprU 4, 1929, was $414,184, of which
71799—30—FI1929
19
257
258
°
REPORT ON T H E FINANCES
$190,160 represented war loans and $224,024 agricultural and livestock loans (including expense advances of $6,300). During the
period from October 15, 1928, to April 4, 1929, the expense advances
made by the corporation aggregated $1,100. During the same period
the repayments on account of the corporation's agricultural and livestock loans, including $8,727 on account of expense advances, totaled
$219,540, of which $174,965 was repaid by banking institutions, and
$44,575 by livestock loan companies, while $9,840 was repaid on the
corporation's war loans, maldng total repayments on all loans from
October 15, 1928, to AprU 4, 1929, of $229,380.
For the period from April 5, 1929, to October 15, 1929, no additional expense advances were made. The amount carried on the
corporation's books on October 15, 1929, was $365,459, of which
$170,480 represented war loans and $194,979 agricultural and livestock loans (including expense advances of $3,406). During this
period the repayments on the corporation's agricultural and livestock
loans, including $2,890 on account of expense advances, totaled
$35,120, of which $29,812 was repaid by banking institutions and
$5,308 by livestock loan companies, while $19,680 was repaid on
the corporation's war loans, making total repayments on all loans
from AprU 5, 1929, to October 15, 1929^, of $54,800. '
EXHIBITS
269
EXHIBITS
THE PUBLIC DEBT
Issues of December, 1928
EXHIBIT
1
Ofering of certificates of indebtedness, Series TS2-1929 {^Yi P^^ cent)
and Series TD-1929 UVi P^f' cent) (press release, December 7, 1928,
with Department Circular No, 411)
The Treasury is to-day announcing its regular December financing,
which takes the form of an offering of Treasury certificates of indebtedness in two series, both dated and bearing interest from December
15, 1928, at the rate of 4}^ per cent, one series being for 9 months,
maturing September 15, 1929, and the other series being for 12
months and maturing December 15, 1929. The amount of the 9month offering is $200,000,000, or thereabouts, and the amount
of the 12-month offermg is $300,000,000, or thereabouts.
The Treasury will accept in payment for the new certificates, at
par. Treasury certificates of indebtedness of Series TD-1928,
TD2-1928, and TD3-1928, aU maturing December 15, 1928. Subscriptions for which payment is to be tendered in certificates of
indebtedness maturing December 15, 1928, will be allotted in full
up to the amount of the respective offerings.
About $570,000,000 of Treasury certificates of indebtedness become
payable in December, 1928. Also, about $95,000,000 in interest
payments on the public debt become payable on December 15.
This offering, together with cash on hand, will provide for the
Treasury's requirements up to March 15, 1929.
The text of the official circular foUows:
[Department Circular Noi 411]
The Secretary of' the Treasury, under the authority of the act
approved September 24, 1917, as amended, offers for subscription, at
par and accrued interest, through the Federal reserve banks. Treasury
certificates of indebtedness, in two series, both dated and bearing
interest from December 15, 1928, the certificates of Series TS2-1929
being payable on September 15, 1929, with interest at the rate of 4}^
per cent per annum, payable on a semiannual basis, and the certificates
of Series TD~1929 being payable on December 15, 1929, with interest
at the rate of 4}^ per cent per annum, payable semiannually.
Applications will be received at the Federal reserve banks.
Bearer certificates will be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates of Series TS2-1929
will have two interest coupons attached, payable March 15, 1929, and
September 15, 1929, and the certificates of Series TD-1929 two
interest coupons attached, payable June 15, 1929, and December 15,
1929.
The certificates of said series shall be exempt, both as to principal
and interest, from all taxation now or hereafter imposed by the
261
262
REPORT ON THE FINANCES
United States, any State, or any of the possessions of the United
States, or by any local taxing authority, except (a) estate or inheritance taxes, and (&) graduated additional income taxes, commonly
known as surtaxes, and excess-profits and war-profits taxes, now or
hereafter imposed by the United States, upon the income or profits
of individuals, partnerships, associations, or corporations. The
interest on an amount of bonds and certificates authorized by said
act approved September 24, 1917, and amendments thereto, the
principal of which does not exceed in the aggregate $5,000, owned by
any individual, partnership, association, or corporation, shall be
exempt from the taxes provided for in clause (6) above. The certificates of these series will be accepted at par during such time and
under such rules and regulations as shall be prescribed or approved
by the Secretary of the Treasury, in payment of income and profits
taxes payable at the maturity of the certificates. The certificates
of these series will be acceptable to secure deposits of public moneys,
but will not bear the circulation privilege.
The right is reserved to reject any subscription and to allot less than
the amount of certificates of either or both series applied for and to
close the subscriptions as to either or both series at any time without
notice. The Secretary of the Treasury also reserves the right to make
allotment in full upon applications for smaller amounts, and to make
reduced allotments upon, or to reject applications for lafger amounts,
and to make classified allotments and allotments upon a graduated
scale; and his action in these respects will be final. Allotment
notices will be sent out promptly upon allotment, and the basis of the
allotment will be publicly announced.
Payment at par and accrued interest for certificates allotted must
be made on or before December 15, 1928, or on later allotment. After
allotment and upon payment Federal reserve banks may issue interim
receipts pending delivery of the definitive certificates. Any qualified
depositary will be permitted to make payment by credit for certificates
allotted to it for itself and its customers up to any amount for which
it shall be qualified in excess of existing deposits, when so notified
b}^ the Federal reserve bank of its district. Treasury certificates of
indebtedness of Series TD-1928, TD2-1928, and TD3-1928, aU
maturing December 15, 1928, will be accepted at par, in payment for
any certificates of the series now offered which shall be subscribed for
and allotted, with an adjustment of the interest accrued, if any, on
the certificates of the series so paid for.
As fiscal agents of the United States, Federal reserve banks are
authorized and requested to receive subscriptions and to make
allotments on the basis and up to the amounts indicated by the
Secretary of the Treasury to the Federal reserve banks of the respective districts.
A. W.
MELLON,
Secretary of the Treasury.
TREASURY DEPARTMENT,
OFFICE OF THE SECRETARY,
December 7, 1928.
To the investor:
Almost any. banking institution in the United States will handle your subscription for you, or you may make subscription direct to the Federal reserve
bank of your district. Your special attention is invited to the terms of subscription and allotment as stated above. If you desire to purchase, at the
SECRETARY O F T H E TREASUR.Y
263
market price, certificates of the above issues after the subscriptions close, or
certificates of any outstanding issue, you should apply to your own bank, or,
if it can not obtain them for you, to the Federal reserve bank of your district,
which will then endeavor to fill your order in the market.
EXHIBIT 2
Subscriptions and allotments, certificates of indebtedness. Series TS2-'
1929 and Series TD-1929 (from press releases, December 13, 1928,
and December 20, 1928, revised ^)
Secretary Mellon announced that subscriptions for the two issues
of'Treasury certificates of indebtedness. Series TS2-1929, 4}^ per cent,
dated December 15, 1928, maturing September 15, 1929, and Series
TD-1929, 4)^ per cent, dated December 15, 1928, maturing December
15, 1929, closed at the close of business on December 12, 1928.
Reports received from the 12 Federal reserve banks show that for
the offering of 4% per cent certificates of Series TS2-1929, which
was for $200,000,000, or thereabouts, total subscriptions aggregate
$263,227,000, and that for the offering of 4% per cent certificates of
Series T][)-1929, which was for $300,000,000,^ or thereabouts, total
subscriptions aggregate $367,955,000. As previously announced, subscriptions in payment of which Treasury certificates of indebtedness
of Series TD-1928, Series TD2-1928, and Series TD3-;-1928, aU maturing December 15, 1928, were tendered, were allotted in full. Upon
these exchange subscriptions $39,473,500 have been allotted. Allotments on the cash subscriptions for certificates of Series TS2-1929
were made as follows: All subscriptions in amounts not exceeding
$50,000 for any one subscription were allotted in full. Subscriptions
in amounts over $50,000 but not exceeding $1,000,000 for any one
subscriber were allotted 80 per cent, but not less than $50,000 for
any one subscription, and subscriptions in amounts over $1,000,000
for any one subscriber were allotted 70 per cent, but not less than
$800,000 for any one subscription.
y
Allotments on cash subscriptions for certificates of Series TD-1929
were made as follows: All subscriptions in amounts not exceeding
$50,000 for any one subscriber were allotted in full. Subscriptions
in amounts over $50,000 but not exceeding $1,000,000 for any one
subscriber were allotted 90 per cent, but not less than $50,000 for
any one subscription, and subscriptions in amounts over $1,000,000
for any one subscriber were allotted 75 per cent, but not less t^ian
$900,000 for any one subscription.
1 Revised January 19, 1929.
264
REPORT ON T H E
FINANCES
The subscriptions and allotments were divided among the several
Federal reserve districts and the Treasury as follows:
Series TD-1929
Series TS2-1929
F e d e r a l reserve district
T o t a l subscrip- T o t a l subscrip- T o t a l subscrip- T o t a l subscriptions received tions allotted tions received tions allotted
Boston
NewYork
Philadelptiia
Cleveland
Richmond.. ..
Atlanta
Chicago
..
St. L o u i s . . .
Minneapolis
Kansas City
Dallas
San F r a n c i s c o . .
Treasury
_
Total
$9, 647,
64, 388,
13, 555,
22, 710,
16, 219,
18, 419,
20,161,
9, 323,
4, 797,
5, 674,
19, 966,
58, 218,
146,
000
500
000
500
500
500
500
500
000
000
000
500
500
500
500
000
500
500
500
500
500
000
000
000
500
000
$8,100,000
146, 044, 500
24, 381, 000
21, 369, 000
9, 042, 500
17, 964, 500
24,103, 000
10, 742, 000
5, 602, 000
10, 657, 000
25, 432, 000
64, 295, 500
222, 000
$7,826,
116, 700,
21, 033,
18, 748,
8, 565,
16, 635,
21, 867,
9, 664,
0, 339,
9, 723,
23, 929,
49, 969,
214,
209, 918, 000
367, 955, 000
310, 245, 500'
$8,617,
48, 968,
10, 778,
17, 854,
14,866,
15,961,
16, 708,
7, 905,
4, 352,
4, 737,
17,141,
41, 881,
146,
263, 227, 000
Total subscriptions, both series..
Total allotments, both series
500
000500
500'
000
000'
500^
500
000
000
500'
000
500-
$631,182,000520,163, 500^
Issue of March, 1929
EXHIBIT
3
Ofering of certificates of indebtedness, Series TD2-1929 U% per cent)
(jpress release, March 7, 1929, with Department Circular No. 4^3)
The Treasury is to-day offering for subscription, at par and accrued
interest, through the Federal reserve banks, an issue of nine months
4% per cent Treasury certificates of indebtedness of Series TD2-1929,
dated and bearing interest from March 15, 1929, and maturing December 15, 1929. The amount of the offering is $475,000,000, or
thereabouts.
Applications will be received at the Federal reserve banks. The
Treasury will accept in payment for the new certificates, at par^
Treasury certificates of indebtedness of Series TM-1929 and T M 2 1929, both maturing March 15, 1929. Subscriptions for which payment is to be tendered in certificates of indebtedness maturing
March 15, 1929, will be aUotted in fuU up to the amount of the
offering.
Bearer certificates will be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates wiU have two interest
coupons attached payable September 15 and December 15, 1929.
About $560,000,000 of Treasury certificates of indebtedness and
about $60,000,000 in interest payments on the public debt become
due and payable on March 15, 1929.
The present offering, with tax and other receipts, is expected to
cover the Treasury's cash requirements until June.
The text of the official circular follows:
SECRETARY OF T H E TREASURY
265
[Department Circular No. 413]
The Secretary of the Treasury, under the authority of the act
approved September 24, 1917, as amended, offers for subscription, at
par and accrued interest, through the Federal reserve banks, Treasury
certificates of indebtedness of Series TD2-1929, dated and bearing
interest from March 15, 1929, payable December 15, 1929, with
interest at the rate of 4% per cent per annum, payable on a semiannual
basis.
Applications will be received at the Federal reserve banks.
Bearer certificates will be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates wiU have two interest
coupons attached, payable September 15, 1929, and December 15,
1929.
The certificates of said series shall be exempt, both as to principal
and interest, from all taxation now or hereafter imposed by the
United States, any State, or any of the possessions of the United
States, or by any local taxing authority, except {a) estate or inheritance taxes, and (6) graduated additional, income taxes, commonly
known as surtaxes, and excess-profits and war-profits taxes, now or
hereafter imposed by the United States, upon the income or profits of
individuals, partnerships, associations, or corporations. The interest
on an amount of bonds and certificates authorized by said act
approved September 24, 1917, and amendments thereto, the principal
of which does not exceed in the aggregate $5,000, owned by any
individual, partnership, association, or corporation, shall be exempt
from the taxes provided for in clause (b) above.
The certificates of this series will be accepted at par during such
time and under such rules and regulations as shall be prescribed or
approved by the Secretary of the Treasury, in payment of income
and profits taxes payable at the maturity of the certificates. The
certificates of this series will be acceptable to secure deposits of
public moneys, but will not bear the circulation privilege.
The right is reserved to reject einj subscription and to allot less
than the amount of certificates applied for and to close the subscriptions at any time without notice. The Secretary of the Treasury
also reserves the right to make allotment in full upon applications for
smaller amounts, to make reduced allotments upon or to reject
applications for larger amounts, and to make classified allotments
and allotments upon a graduated scale; and his action in these
respects will be final. Allotment notices will be sent out promptly
upon aUotment, and the basis of the allotment will be publicly
announced.
Payment at par and accrued interest for certificates allotted must
be made on or before March 15, 1929, or on later allotment. After
allotment and upon payment, Federal reserve banks may issue interim
receipts pending deliver}^ of the definitive certificates. Any qualified
depositary will be permitted to make payment by credit for certificates allotted to it for itself and its customers up to any amount for
which it shall be qualified in excess of existing deposits, when so
notified by the Federal reserve bank of its district. Treasury certificates of indebtedness of Series TM-1929 and TM2-1929, both
maturing March 15, 1929, will be accepted at par, in payment for
any certificates of the series now offered which shall be subscribed
266
REPORT ON T H E FINANCES
for and allotted, with an adjustment of the interest accrued, if any,
on the certificates of the series so paid for.
As fiscal agents of the United States, Federal reserve banks are
authorized and requested to receive subscriptions and to make allotments on the basis and up to the amounts indicated by the Secretary
of th^ Treasury to the Federal reserve banks of the respective
districts.
A. W.
MELLON,
Secretary of ihe Treasury.
TREASURY DEPARTMENT,
O F F I C E OF THE SECRETARY,
March 7, 1929.
To the investor:
Almost any banking institution in the United States will handle your subscription for 5^ou, or you may make subscription direct to the Federal reserve bank of
3^our district. Your special attention is invited to the terms of subscription and
allotment as stated above. If you desire to purchase, at the market price,
certificates of the above issue after the subscriptions close, or certificates of any
outstanding issue, you should apply to your own bank, or, if it can not obtain
them for you, to the Federal reserve bank of your district, which will then
endeavor to fill your order in the market.
EXHIBIT 4
Subscriptions and allotments, certificates of indebtedness. Series TD21929 {from press releases, March 13, 1929, and March 14, 1929)
Secretary Mellon announced that subscriptions for the issue of
Treasury certificates of indebtedness. Series TD2-1929, 4% per cent,
dated March 15, 1929, maturing December 15, 1929, closed at the
close of business on March 12, 1929.
Reports received from the 12 Federal reserve banks show that for
the off'ering, which was for $475,000,000, or thereabouts, total subscriptions aggregate $524,109,000. As previously announced, subscriptions in payment of which Treasury certificates of indebtedness
of Series TM-1929 and Series TM2-1929, maturing March 15, 1929,
were tendered, were allotted in full. Upon these exchange subscriptions $32,796,500 have been allotted. Allotments on the cash subscriptions were made as follows: All subscriptions in amounts not
exceeding $100,000 for any one subscriber were allotted in full. Subscriptions in amounts over $100,000 but not exceeding $1,000,000 for
any one subscriber were allotted 90 per cent, but not less than $100,000
for any one subscriber, and subscriptions in amounts over $1,000,000
for any one subscriber were allotted 85 per cent, b u t not less than
$900,000 for any one subscriber.
The subscriptions and allotments were divided among the several
Federal reserve districts and the Treasury as follows:
Federal reserve
district
Boston
New York
Philadelphia
Cleveland
Richmond
Chicago
St.Louis
Total subscriptions
received
$24, 715,000
202, 996, 000
31, 613, 500
33, 366, 500
30, 022, 000
. 27,544,000
63, 670, "500
-16,121, 500
Total subscriptions
allotted
$24,130,000
177, 734, 500
28, 656, 000
31,122, 000
27, 952, 000
26,136, 000
58, 271, 500
15, 279, 000
Federal reserve
district
Minneapolis..
Kansas City
Dallas
San Francisco
Treasury
Total
Total subscriptions
received
Total subscriptions
allotted
$8,889,000
17,499,500
30. 009,000
37, 289, 000
373, 600
$8, 494, OOQ
16,892, 000
28, 222, 000
.32, 737, 000
373, 50Q
524,109, 000
475,999, 50Q
SECRETARY O F THE
TREASURY
267
Issue of June, 1929
EXHIBIT
5
Ofiering of certificates of indebtedness, Series TM-1930 {5)i per cent)
(jpress release, June 7, 1929, with Department Circular No. 4^4)
The Treasury is to-day ofl'ering for subscription, at par and accrued
interest, through the Federal reserve banks, an issue of nine-month
5}^ per cent Treasury certificates of indebtedness of Series TM-1930,
dated and bearing interest from June 15, 1929, and maturing March
15, 1930. The amount of the offering is $400,000,000, or thereabouts.
Applications will be received at the Federal reserve banks. The
Treasur}^ will accept in payment for the new certificates, at par.
Treasury certificates of indebtedness of Series TJ-1929, maturing
June 15, 1929. Subscriptions for which payment is to be tendered
in certificates of indebtedness maturing June 15, 1929, will be allotted
in full up to the amount of the offering.
Bearer certificates wUl be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates wiU have two interest
coupons attached payable September 15, 1929, and March 15, 1930.
About $500,000,000 of Treasury certificates of indebtedness and
nearly $100,000,000 in interest payments on the public debt become
due and payable on June 15, 1929.
The present offering,^ with tax and other receipts,^is expected to
cover the Treasury's cash requirements until September.
The text of the official circular follows:
[Department Circular No. 414]
The Secretaiy of the Treasury, under the authority of the act
approved September 24, 1917, as amended, offers for subscription,
at par and accrued interest, t h r o u g h ' t h e Federal reserve banks,
Treasury certificates of indebtedness of Series TM-1930, dated and
bearing interest from June 15, 1929, payable March 15, 1930, with
interest at the rate of 5)^ per cent per annum, payable on a semiannual
basis.
Applications will be received at the Federal reserve banks.
Bearer certificates will be issued in denominations of $500, $1,000
$5,000, $10,000, and $100,000. The certificates wiU have two interest
coupons attached, payable September 15, 1929, and March 15, 1930.
The certificates of said series shall be exempt, both as to principal
and interest, froiA all taxation now or hereafter imposed by the United
States, any State, or anj^ of the possessions of the United States, or by
any local taxing authority, except {a) estate or inheritance taxes, and
(&) graduated additional income taxes,-commonly known as surtaxes,
and excess-profits and war-profits taxes, now or hereafter imposed by
the United States, upon the income or profits of individuals, partnerships, associations, or corporations. The interest on an amount of
bonds and certificates authorized by said act approved September 24,
1917, and amendments thereto, the principal of which does not exceed
in the aggregate $5,000, o\vned by any individual, partnership,
268
REPORT ON THE FINANCES
association, or corporation, shall be exempt from the taxes provided
for in clause (b) above.
The certificates of this series will be accepted at par during such
time and under such rules and regulations as shall be prescribed or
approved by the Secretary of the Treasury, in payment of income and
profits taxes payable at the maturity of the certificates. The certificates of this series will be acceptable to secure deposits of public
moneys, but will not bear the circulation privilege.
The right is reserved to reject any subscription and to allot less than
the amount of certificates applied for and to close the subscriptions
at any time without notice. The Secretary of the Treasury also
reserves the right to make allotment in full upon applications for
smaller amounts, to make reduced allotments upon or to reject
applications for larger amounts, and to make classified allotments
and allotments upon a graduated scale; and his action in these
respects will be final. Allotment notices will be sent out promptly
upon allotment, and the basis of the allotment will be publicly announced.
Payment at par and accrued interest for certificates allotted must
be made on or before June 15, 1929, or on later allotment, iif ter
allotment and upon payment. Federal reserve banks may issue interim
receipts pending delivery of the definitive certificates. Any qualified
depositary will be permitted to make payment by credit for certificates
allotted to it for itself and its" customers up to any amount for which
it shall be qualified in excess of existing deposits, when so notified
by the Federal reserve bank of its district. Treasury certificates
of indebtedness of Series TJ-1929, maturing June 15, 1929, will be
accepted at par, in payment for any certificates of the series now
offered which shall be subscribed for and allotted, with an adjustment
of the interest accrued, if any, on the certificates of the series so paid
for.
As fiscal agents of the United States, Federal reserve banks are
authorized and requested to receive subscriptions and to make allotments on the basis and up to' the amounts indicated by the Secretary
of the Treasury to the Federal reserve banks of the respective districts.
A. W.
MELLON,
Secretary of the Treasury.
TREASURY DEPARTMENT,
OFFICE OF THE SECRETARY,
June 7, 1929.
To the investor:
^
Almost any banking institution in the United States will handle your subscription for you, or you may make subscription direct to the Federal reserve bank
of your district. Your special attention is invited to the terms of subscription
and allotment as stated above. If your desire to purchase, at the market price,
certificates of the above issue.after the subscriptions close, or certificates-of.any
outstanding issue, you should apply to your own bank, or, if it can not obtain
them for you, to the Federal reserve bank of your district, which will then endeavor to fill your order in the market.
269
SECRETARY OF T H E TREASURY
EXHIBIT 6
Subscriptions and allotments, certifi.cates of indebtedness, Series T M 1930 [from press releases, June 12, 1929, and June 14, 1929,
revised ^)
Secretary Mellon announced that subscriptions for the issue of
Treasury certificates of indebtedness, dated June 15, 1929, Series
TM-1930, 5% per cent, maturing March 15, 1930, closed at the close
of business on June 10, 1929.
The reports received from the 12 Federal reserve banks show that
for the offering, which was for $400,000,000, or thereabouts, total
subscriptions aggregate $1,118,862,000. As previously announced,
subscriptions in payment of which Treasury certificates of indebtedness of Series TJ-1929, maturing June 15, 1929, were tendered, were
allotted in full. Upon these exchange subscriptions about $86,985,500
have been allotted. Allotments on cash subscriptions were made as
follows: Subscriptions in amounts not exceeding $1,000 were allotted
in full; subscriptions in amounts over $1,000 but not exceeding
$10,000 were allotted 70 per cent, but not less than $1,000 on any
one subscription; subscriptions in amounts over $10,000 but not
exceeding $100,000 were allotted 50 per cent, but not less than
$7,000 on any one subscription; subscriptions in amounts over
$100,000 but not exceeding $1,000,000 were allotted 30 per cent, but
not less than $50,000 on any one subscription; and subscriptions in
amounts over $1,000,000 were allotted 20 per cent, but not less than
$300,000 on any one subscription.
The subscriptions and allotments were divided among the several
Federal reserve districts and the Treasury as follows:
Federal reserve
district
Total subscrip- Total subscriptions received tions allotted
Federal reserve
district
Total subscrip- Total subscriptions received tions allotted
•
Boston
New York
Philadelphia
Cleveland
Richmond
A tlanfa
Chicago
St. Louis
$53, 869, 500
346,166,000
110,681, 500
75,331,500
38,964,000
57, 236, 500
114,819, 500
39, 054, 500.
$22,643,000
90,289,000
37,300,000
33,110, 500
19, 232, 000
23, 056,000
62,201, 000
19, 641, 500
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
Total
$18,121,000
30, 659, 500
49,849, 500
182,469, 500
1,639, 500
$10,441, 000
18, 097, 000
20,464,000
46, 243,000
1,491, 500
1,118,862,000
404,209,500
Purchase of Treasury notes, July, 1929
EXHIBIT 7
Ofi^er to purchase Treasury notes, Series A-1930-32 (press release,
July 11, 1929)
Acting Secretary MUls to-day announced that he has authorized
the Federal reserve banks to purchase, at the option of holders, for
account of the sinking fund, up to $75,000,000, or thereabouts,
aggregate face amount of 3K per cent Treasury notes of Series A-193032 at 98 and accrued interest. This offer will remain open until the
close of business on Tuesday, July 16, 1929, and without further
notice will then terminate or at such earlier date as the fuU amount
shall have been tendered.
a Revised July 16.1929.
270
REPORT ON T H E
FINANCES
Tenders will be accepted^ in the order in which received, and those
making tenders wUl be notified of acceptance or rejection. Any notes
tendered for purchase must be forwarded at the owner's own expense
and risk, and such notes may accompany the tender, or may be forwarded upon receipt of notification from Federal reserve bank of
acceptance of offer. In any event the notes accepted must be received
at the Federal reserve bank on or before Thursday, July 18, and the
Federal reserve bank on that date will make payment for such notes
at 98 and accrued interest from March 15 to July 18, 1929. Any
Treasury notes. Series A-1930-32, presented for purchase under this
oft'er should have attached the coupon bearing date September 15,
1929, and aU subsequent dates (Nos. 5 to 10, inclusive).
EXHIBIT 8
Purchase of Treasury notes. Series A-1930-32 (press release, July 17,
1929)
Secretary Mellon to-day, in referring to the offer made on July 11,
1929, to purchase $75,000,000, or thereabouts, aggregate face amount
of 3K per cent Treasury notes of Series A-1930-32, at the option of
holders, for account of the cumulative sinking fund, which offer
closed last evening, announced that tenders aggregating $75,869,450
had been received at Federal.reserve banks, all of which have been
accepted by the Treasury.
In accordance with the terms of the offer, payment for the notes
tendered will be made on July 18, 1929, at 98 and accrued interest
from March 15.
Issue of Seplember, 1929
EXHIBIT 9
Offering of certificates of indebtedness. Series TJ-1930 (4]i per cent)
(press release, September 6, 1929, with Department Circular No. 417)
To meet a maturity of about $510,000,000' bf Treasury certificates,
the Treasury is to-day offering for subscription, at par and accrued
interest, through the Federal reserve banks, an issue of nine-month
4% per cent Treasury certificates of indebtedness of Series TJ-1930,
dated and bearing interest from September 16, 1929, and maturing
June 16, 1930. The amount of the offering is $500,000,000, or
thereabouts.
Applications for the new certificates will be received at the Federal
reserve banks.. The Treasury will accept in payment for these
certificates, at par. Treasury certificates of indebtedness of Series
TS-1929 and TS2-1929, both maturing September 15, 1929. Subscriptions for which payment is to be tendered in certificates of
indebtedness maturing September 15, 1929, will be allotted in full up
to the amount of the offering. In addition, 3K per cent Treasury
notes of Series A-1930-32, ^ - 1 9 3 0 - 3 2 , and C-1930-32 wUl be accepted
at a price of $98 for each $100 face amount, with an adjustment of
interest accrued to September 16, 1929, in part payment for any
SECRETARY OF T H E TREASURY
271
certificates of the series now offered, up to $100,000,000 face amount of
notes, the dift'erence between the price of $98 for the notes and the
$100 face amount of the new certificates to be paid in cash on or
before September 16, 1929. Payment by Treasury motes will be
treated as cash subscriptions and will be given preferred allotment in
the order received. These notes are being purchased for sinking fund
purposes.
On subscriptions for which Treasury notes are tendered in partial
payment the face amount of the Treasury notes tendered must equal
the face amount of the new certificates subscribed for, and such
subscriptions must be in multiples of $500.
Bearer certificates will be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates wiU have two interest
coupons attached, payable December 16, 1929, and June 16, 1930.
Particular attention is invited to the new tax-exemption provision.
In accordance with the act of Congress approved June 17, 1929,
the new certificates will be exempt, both as to principal and interest,
from all taxation, except estate and inheritance taxes. The interest
on certificates heretofore issued under the second Liberty bond act,
as amended, has been exempt from the normal income tax, but from
surtaxes only to a limited extent. These certificates, however, will
be fully exempt as to interest from surtaxes, as well as normal incoine
taxes, and, accordingly, should be more attractive to the individual
investor.
In addition to $510,000,000 of Treasury certificates of indebtedness
due and payable on September 15, 1929, over $65,000,000 in interest
payments on the public debt will become due and payable in September, 1929, and over $149,000,000 in October, 1929.
The text of the official circular follows:
[Department Circular No. 417]
The Secretary of the Treasury, under the authority of the act
approved September 24, 1917, as amended, offers for subscription,
at par and accrued interest, through the Federal reserve banks.
Treasury certificates of indebtedness of Series TJ-1930, dated and
bearing interest from September 16, 1929, payable June 16, 1930,
with interest at the rate of 4% per cent per annum, payable on a
semiannual basis.
Applications will be received at the Federal reserve banks.
Bearer certificates will be issued in denominations of $500, $1,000,
$5,000, $10,000, and $100,000. The certificates wUl have two
interest coupons attached, payable December 16, 1929, and June 16,
1930.
The certificates of said series shall be exempt, both as to principal
and interest, from all taxation (except estate and inheritance taxes)
now or hereafter imposed by the United States, any State, or any
of the possessions of the United States, or by any local taxing
authority.
The certificates of this series wiU be accepted at par during such
time and under such rules and regulations as shall be prescribed or
approved by the Secretary of the Treasury, in payment of income
and profits taxes payable at the maturity of the certificates. The
272
REPORT ON THE FINANCES
certificates of this series will be acceptable to secure deposits of
public moneys, but will not bear the circulation privUege.
The right is reserved to reject any Subscription and to allot less
than the amount of certificates applied for and to close the subscriptions at any time without notice. The Secretary of the Treasury
also reserves the right to make allotment in full upon applications
for smaller amounts, to make reduced allotments upon, or to reject,,
applications for larger amounts, and to make classified allotments
and allotments upon a graduated scale; and his action in these
respects will be final. Allotment notices will be sent out promptly
upon allotment, and the basis of the allotment will be publicly
announced.
Payment at par and accrued interest for certificates allotted must
be made on or before September 16, 1929, or on later allotment.
After allotment and upon payment. Federal reserve banks may issue
interim receipts pending delivery of the definitive certificatiBS. Any
qualified depositary will be permitted to make payment by credit
for certificates allotted to it for itself and its customers up to any
amount for which it shall be qualified in excess of existing deposits,,
when so notified by the Federal reserve bank of its district. Treasury certificates of indebtedness of Series TS-1929 and TS2-1929,
both maturing September 15, 1929, will be accepted at par, in payment for any certificates of the series now off'ered which shall be
subscribed for and allotted, with an adjustment of the interest
accrued, if any, on the certificates of the series so paid for. I n
addition, 3K per cent Treasury notes of Series A-1930-32, B-1930-32,
and C-1930-32 will be accepted at a price of $98 for each $100 face
amount, with an adjustment of interest accrued to September 16,.
1929, in part payment for any certificates of the series now offered,
up to $100,000,000 face amount of notes; the difference between the
price of $98 for the notes and the $100 face amount of the new
certificates to be paid in cash on or before September 16, 1929.
The exchange of notes for certificates wUl be treated as cash subscriptions and will be given preferred allotment in the order received.
All coupons maturing after September 15, 1929, must be attached
to the notes when surrendered, and prior coupons should be detached.
These notes are being purchased for sinking fund purposes.
As fiscal agents of the United States, Federal reserve banks are
authorized and requested to receivie subscriptions and to make
allotments on the basis and up to the amounts indicated by the
Secretary of the Treasury to the Federal reserve banks of the
respective districts.
A. W.
MELLON,
Secretary of the Treasury.
TREASURY DEPARTMENT,
O F F I C E OF THE SECRETARY,
September 6, 1929.
To the investor:
Almost any banking institution in the United States will handle your subscription for you, or you may make subscription direct to the Federal reserve bank
of your district. Your special attention is invited to the terms of subscription
and allotment as stated above. If you desire to purchase, at the market price,,
certificates of the above issue after the subscriptions close, or certificates of any
outstanding issue, you should apply to your own bank, or, if it can not obtain .
them for you,' to the Federal reserve bank of your district, which will then
endeavor to fill your order in the market.
273
SECRETARY OF T H E TREASURY
EXHIBIT
10
Subscriptions and allotments, certificates ofindebtedness. Series TJ-1930
(from press releases, September 11 ^ 1929, and September 13, 1929)
Secretar}^ MeUon announced that subscriptions for the issue of
Treasury certificates of indebtedness, dated September 16, 1929,
Series TJ-1930, 4% per cent, maturing June 16, 1930, closed at the
close of business on vSeptember 9, 1929. The reports received from the
12 Federal reserve banks show that for the offering, total subscriptions aggregate $1,486,492,000. Of these subscriptions, $104,274,000
represent subscriptions for which Treasury certificates of indebtedness
of Series TS-1929 and Series TS2-1929, both maturing September
15, 1929, were tendered in payment, aU of which were allotted in fuU,
and $105,795,500 represent subscriptions for which 3K per cent Treasury notes were tendered in partial payment, of which only $100,000,000
were accepted, in accordance with the terms of the Treasury's original
announcement.
Allotments on other subscriptions were-made as follows: All cash
subscriptions in amounts not exceeding $1,000 for any one subscriber
were allotted in full. Cash subscriptions in amounts over $1,000
but not exceeding $50,000 were allotted 70 per cent, but not less than
$1,000 on any one subscription; cash subscriptions in amounts over
$50,000 but not exceeding $100,000 were allotted 40 per cent, but
not less than $35,000 on any one subscription; cash subscriptions in
amounts over $100,000 but not exceeding $1,000,000 were allotted
30 per cent, but not less than $40,000 on any one subscription; and
cash subscriptions in amounts over $1,000,000 were aUotted 15 per
cent, but not less than $300,000 on any one subscription.
The subscriptions and allotments were divided among the several
Federal reserve districts and the Treasury as follows:
Federal reserve dis- Total subscrip- Total subscrip- Federal reserve dis- Total subscrip- Total subscriptions received tions allotted
trict
tions received tions allotted
trict
Boston
.
New York
Philadelphia
Cleveland
Richmond
Aflanfn
Chicago
St. Louis
..
.
$74,250,000
653,602, 500
143, 740, 500
, 97, 375,000
37, 651, 500
58, 635,000
116, 734, 500
27, 517, 000
$27,218,000
217, 362, 500
51, 105, 000
44, 753,000
20,001, 500
25, 650,000
53, 914, 000
14,167, 600
Minneapolis
Kansas City
Dallas.- . . .
San Francisco
Treasury
Total
$16,805, 500
28,024, 500
62, 721,000
168,684, 500
750, 500
$10,186, 500
17,320, 500
27,814,000
39, 523, 000
692,000
1,486,492,000
549, 707, 500
Treasury bills
EXHIBIT
11
Statement of Secretary Mellon in connection with the bills introduced by
Senator Smoot and Representative Hawley authorizing the Treasury
Department to sell Treasury bills on a discount basis (press release,
April 22, 1929)
The present method of financing the requirements of the United
States Government was developed as a war measure and not only
served admirably in financing war-time expenditures but has continued to function satisfactorily up to the present time. The Treasury
Department believes, however, that in so far as short-term financing
7 1 7 9 9 ^ 3 0 — F I 1929
20
274
REPORT ON THE FINANCES
is concerned, certain modifications are desirable in the interest of
greater economy and of closer adjustment of current borrowings to
the immediate needs of the Government.
Generally speaking, short-term financing of the Government is
carried on by means of Treasury certificates, with maturities of from
3 to 12 months, issued quarterly on tax-payment dates and maturing
on tax-payment dates. These certificates serve a threefold purpose:
They maintain a part of the outstanding war debt in the form of shortterm securities, which, on the whole, has been advantageous from the
standpoint of interest charges. They provide the necessary funds to
meet the current obligations of the Government. Since their maturities coincide with the period during which very heavy tax payments
are received, they furnish an effective instrument for preventing heavy
withdrawal of funds from the market, with a consequent serious disturbance every quarter date.
I t is not the purpose of the Treasury Department to dispense with
this system, to which our people have become accustomed and which
has functioned smoothly and efficiently, but rather to correct certain
defects which have developed and to supplement it in such a way as
will decrease the cost of financing and adjust it more closely to the
needs of the Government.
The defects may be briefly described as follows:
1. Since the Government borrows only four times a year, the funds
are borrowed in advance of the actual requirements and the interest
cost on such borrowings has exceeded the interest received on idle
Government deposits. Thus, for instance, the Government borrows
on the 15th of March the funds necessary to meet certain definite
obligations on the 15th of April, and there is necessarily a 30-day interest loss on the funds borrowed. If, however, the Treasury sold
bills on the 15th of April rather than certificates on a deposit credit
basis on the 15th of March, the saving w^ould be immediate and
substantial.
2. WhUe the maturing of securities to-day synchronizes in a general
way with the collection of income taxes, in practice the redemption of
these securities proceeds more rapidly than income tax checks can be
collected. Consequently at every tax period there is a temporary
excess of Treasury disbursements, which necessitates temporary certificates of indebtedness issued to cover overdrafts at the Federal
reserve banks, on which the Treasury Department pays interest in
addition to the interest paid on the newly issued securities.
3. Under the present system, where certificates are issued bearing
a fixed coupon rate, the Treasury Department is confronted with the
difficult task of accurately adjusting the interest rate to current market conditions, and while the department has been successful in doing
this with great accuracy, nevertheless it would be more desirable to
have the market itself fix the rate by competitive bidding.
The Treasury Department, therefore, suggests that the necessary
legislative authority be obtained to permit the Treasury to sell shortterm bills, with a maturity not greater than a year, on a discount
basis, thus furnishing the Government with a new and more flexible
type of security. Such Treasury bills would be sold from time to
time in the market whenever funds were needed for cash on a discount
basis at the lowest rates bid by prospective purchasers. I t is not the
purpose of the Treasury Department, however, to discontinue the
SECRETARY OF T H E TREASURY
275
present depository method or system of short-term financing, but
rather to supplement it with the new system, using both as may prove
to be most advantageous to the interests of the Government.
Several important advantages may be expected to follow the
adoption of this new form of Treasury obligation:
1. Competitive bidding for these bills should enable the Treasury
to get the lowest discount rates consistent with current market
conditions.
2. The sale of these securities could be timed to coincide almost
exactly with the need for funds, thus saving the interest on money
borrowed ahead of requirements.
3. Maturities could be timed to correspond closely to the actual
collection of income taxes and not all made to fall on the nominal
d ^ e of tax payments, as at present.
4. They would enable the Treasury to take advantage of periods
of seasonal ease for the sale of Treasury bills rather than, as sometimes occurs, compel the Treasury to offer a large issue of securities
during a period of temporary stringenc}^ and high money rates.
5. The banks and the investing public would be furnished with a
new instrument for the investing of temporary surplus funds, with
frequent and convenient maturities.
EXHIBIT
12
^' Treasury Bills,^^ an address by Undersecretary of the Treasury Mills,
April 24} 1929, befo7'e the Forum of Washington Chapter, American
Institute of Banking, Washington, D . C
The Treasury Department is the central agency through which the
Federal Government conducts its financial affairs. Generally speaking, it receives and has the custody of all funds paid to the Government and disburses all moneys in payment of obligations of the
Government. One of the primary duties, therefore, of the Treasury
Department is to see that the Government always has on hand
sufficient funds to meet its obligations, including public debt maturities, and to do so in such a way as to effect a minimum disturbance
to money and business conditions. If taxes and receipts flowed
uniformly throughout the year,- and expenditures ran an even course
month by month, there would be no real financing problem, but this
is true neither of receipts nor of expenditures. Tax receipts rise to a
sharp peak four times a year, while heavy debt maturities and interest
payments are not spread out, but come due on single days and at
irregular intervals. Speaking in general terms, then, in so far as
current financing is concerned, our problem and our aim are to
synchronize peak-tax payments with the maturing of heavy obligations and, in the intervals, to have in bank no more funds than are
needed to meet current expenditures.
Our present method of financing was developed during the war.
I t was well adapted to meet emergency war conditions and, generally
speaking, has continued to function effectively and smoothly during
the postwar period, which has witnessed Government financing of a
magnitude second only to that of the war period. Certain defects
have, however, developed, and the Treasury Department feels that
276
REPORT ON T H E FINANCES
they can be remedied and, in addition, that the Treasury will be in a
position to conduct financing with greater economy and fiexibihty
if it is authorized to issue a new form of Government security—that is,
a Treasury bill, sold on a discount basis.
In order fully to understand the existing situation, it is well to
review briefly how the present system came into existence and just
how the current financing mechanism operates to-day.
When the United States entered the war in 1917, the prospective
expenditures were so large that it became evident immediately that
the previously existing method of financing Government expenditures
was wholly inadequate. This method was for the Treasury to invite
cash subscriptions for limited amounts of Government obligations,
and, in order to avoid disturbances to the money market, to place
such part of the proceeds as was not immediately needed on deposit in
a conaparatively small number of banks designated as Government
depositaries.
In 1917 the Federal reserve system, ^ i t h its 12 regional banks and
additional branch banks and the contacts which had been established
with large numbers of commercial banks in their respective districts,
offered a more effective organization through which to enlist the
cooperation of the entire banking strength of the Nation. The task
of carrying out the program of war finance, therefore, was placed on
the Federal reserve system.
In order to obtain the immense sums needed it became necessary
to devise a plan that would encourage a widespread participation in
all new issues. The Treasury and the Federal reserve system, therefore, inaugurated a program whereby a large number of banks throughout the country could qualify as Government depositaries, and such
banks in subscribing to new issues could make payment for the securities allotted to them, not in cash but in book credits—deposits
established to the credit of the Government. Although they were
faced with the prospect of the withdrawal of these deposits within a
short period, nevertheless the banks as a whole would, as the result
of Government expenditures, tend to gain in private deposits practically equal amounts. For such banks as lost more through Government withdrawals than they gained through Government disbursements, it was now possible to replace their losses by borrowing
at moderate rates from the Federal reserve banks. In this way subscriptions could be made by banks ih excess of their actual surplus
cash.
This system of widespread bank subscriptions to large amounts of
short-term Government securities paved the way for even more widespread popular subscription to the subsequent issues of Liberty loan
bonds, which were floated to refund short-term indebtedness and to
provide additional funds for war purposes. Just as the banks were
encouraged to subscribe for amounts of short-term securities in excess
of their surplus cash, so individuals were urged to subscribe to more
of the Liberty loan bonds than they could pay for in cash and to borrow the remainder from their own banks. The banks, in turn, could
in case of need, fall back upon the support of the Federal reserve
system. In this way the number of subscribers to Liberty loan bonds
was increased from Aji miUion for the first issue to 9K miUion for the
second, and over 18 million for the third.
SECRETARY OF THE TREASURY
277
Altogether the success of war-time Government financing may be
attributed largely to the system which was worked out to facilitate
the preliminary short-term financing.
Although this system of Government financing was adopted as a
war measure, it has continued to function successfully since. In 1919
the final flotations to cover the cost of our participation in the war
were completed, and the total debt of the Government reached its
maximum of over 26 billion dollars. Of that amount 21 billion was
in Liberty and Victory loan and pre-war bonds, 4 billion was in
Treasur}^ certificates of indebtedness, and less than 1 billion in Treasury savings certificates.
During the subsequent eight years debt retirement was eft'ected at
an average rate of about one billion dollars a year, but monej^- market
conditions made it advantageous to maintain a considerable part of
the outstanding debt in the form of short-term securities. In fact,
as the Victory loan and the second and third Liberty loan bonds matured or became callable, a considerable part of each issue was refunded with short-term securities. These have taken the form of
notes, with a maturity not exceeding 5 years, and of Treasury certificates, with maturities of from 3 to 12 months. Generally speaking,
the Treasury certificates are issued quarterly on tax-payment dates
and mature on tax-payment dates. They furnish a convenient instrument for obtaining the necessary funds to meet the current obligations of the Government, and, since their maturities coincide with
the period during which very heavy tax payments are received, they
are the means of preventing heavy withdrawal of funds from the
market, with consequent serious disturbance every quarter day.
The Federal reserve banks are the fiscal agents of the Treasury
and its payments are generally made through them. Treasury balances in the Federal reserve banks represent money withdrawn from
the market. In view of the very heavy income-tax payments made
on the 15th of March, June, September, and December, unless some
offset is devised and maintained, cash balances with the Federal
reserve banks would rise to a peak on the quarterly dates and would
drop to a minimum just before the next quarterly date. So, once
every three months great sums of money running as high as $400,000,000 would be taken from the commercial banks by the taxpayer and
paid into the Federal reserve banks to the Treasury's accounts,
thereby taking that amount of money out of the money market, with
all of the consequences to interest rates that must follow. I t would
be possible, of course, to meet this situation by redistributing these
deposits among the commercial banks upon some arbitrary basis,
but this would inevitably subject bhe Treasury to all manner of
pressure in favor of particular banks or particular districts. If,
however, on each quarter day, the certificates mature in an amount
approximately equal to tax payments, it is obvious that the two
transactions wash. The tax checks drawn upon the commercial
banks' are deposited with the Federal reserve banks to the Treasury's
account, but, at the same time, there is paid to the commercial banks
a like amount in payment of interest and maturing securities.
This, however, is only part of the picture. We have not taken
into consideration the Government's financial needs between quarter
days, and if-the entire receipts from income taxes are absorbed by
maturing certificates, the Government might well find itself short of
278
REPORT ON THE FINANCES
funds. Quarter day financing, therefore, involves a careful estimate
of the amount needed for expenditures of all kinds during the ensuing
three months' period. This must be added to the amount necessary
to meet maturing certificates, and this sum, less receipts, represents
the amount of new certificates that will have to be issued on the
quarter day. Stated a little differently, tax and other receipts, as a
rule, are not sufficient to meet maturing certificates as well as to
finance the governmental needs over the next three months' period.
I t i^ necessary, therefore, to issue new certificates, which in turn wall
mature on a future tax date, when the process will be repeated.
But, it may be pointed out that if tax payments and maturing
certificates balance so as to involve no withdrawal of funds from the
money market, then the sale of additional certificates must result in
the withdrawal of funds. This would be so, of course, if the new
certificates were sold for cash. They are not, however. As I have
already pointed out, the banks pa}'' for them by means of a deposit
credit. The bank pays 2 per cent interest on the deposit, and from
time to time, as the Government needs cash, a call is made upon the
various banks with which the Treasury has deposits.
There result from this system three main advantages: First, it
makes Government deposits depend not upon the Secretary of the
Treasury but upon the amount of securities any bank sees fit t a
subscribe for; second, it furnishes the Government with a first-class
primary market for its securities and with the machinery through
which a secondary distribution can be effected; third, it permits
large fiscal operations to be conducted without involving a large
transfer or withdrawal of funds on a single date.
These advantages, however, are not unqualified. I t is true that it
is of great benefit to the Treasury to have at all times a first-class
primary market furnished by the banks. At the same time a system
of payment by deposit credit involves, in effect, an additional charge
to the Government. While the Treasuiy Department has succeeded
in borrowing closer and closer to requirements, nevertheless there is
an unavoidable interest cost on funds borrowed in advance of requirements. I t is the existing practice to borrow on quarterly tax dates
amounts sufficient to provide for the ordinary expenditures over receipts of the Government during the following quarter, which, of
course, results in the carrjang of large deposits over considerable
periods of time. This necessarily means that, until the Government
has actual use for the funds borrowed, it loses the difference between
the coupon rate of the securities issued and the 2 per cent which i t
receives from the banks on the deposits. In the second place, while
the maturing of certificates, as I have stated, synchronizes in general
with the collection of income taxes, as a matter of fact the certificates
are for the most part presented for redemption on the due date,
whereas the collection of income tax checks is spread over a period of
some days. As a result, during every income tax payment period
Treasury disbursements exceed receipts and the Treasury is obhged
to borrow temporality from the Federal reserve banks, and, of course,
has to pa}^ interest on this temporary borrowing, in addition to the
interest on the newly issued securities. Moreover, with certificates
bearing a fixed coupon rate, issued at par, the Treasury Department
is called upon four times a year to use its best judgment4n adjusting
interest rates as accurately as possible to rapidly changing market
SECRETARY OF THE TREASURY
279
conditions. I believe that, on the whole, we have been successful,
but it seems probable that the interest cost could be more nicely
adjusted if the market itself were to fix the rate. And, finally, the
issuance of securities on certain fixed dates lacks that flexibility which
is desirable to enable the Treasury to take advantage of favorable
money conditions.
The problem, as we see it, is to maintain the well-established advantages of the present system and at the same time to cure these
defects. We believe that the authority to issue Treasury bills will
enable us to do so.
The bill introduced by Senator Smoot and Representative Hawley
would authorize the Secretary of the Treasury to issue from time to
time Treasury bills on a discount basis, with a maturity not exceeding
12 months, to be sold for cash, under competitive conditions, at the
lowest rates bid by prospective purchasers. I t should be pointed out
that, while this would be a new type of United States Government
security, there is nothuig novel in the form in that it would correspond closely to one of the oldest and best established types of commercial paper—the bankers' bill. The Treasury bill has been used
for many years by the British Treasury as a most convenient and
economical medium to obtain funds to meet current needs. They
have so developed the system of financing by means of Treasury bills
that, with weekly offerings, daily issues, and daily maturities, they
have obtained a degree of flexibility that enables the Treasury to
adjust its cash positions practically from day to day. In London the
weekly issues average about £50,000,000, and as the bills are all
issued for a three months' period, the aggregate amount outstanding
is very large, averaging about £600,000,000. I t is not our purpose to
proceed on anything like the British scale, but we believe that a
monthly offering of a comparatively small amount of 90-day Treasury
bills would offer a number of very definite advantages:
In the first place, competitive bidding for these bills should enable
the Treasury to get the lowest discount rates consistent with current
market conditions, rather than to be obliged to make its best estimate
of what a rate should be.
Secondly, certainly as to part of the expenditures that have to be
met during each quarterly period—and, notably, interest payments
in April and October—the sale of the Treasury bills could be so
adjusted as to avoid the borrowing of funds in advance of requirements, with a consequent heavy interest cost. Moreover, there are
periods when it is extremely difficult to estimate with accuracy
Government receipts. Under the new system, should Government
receipts exceed estimates, the cash position could be promptly adjusted by permitting Treasury bUls to run off without new issues;
and, conversely, if receipts fell below estimates, the cash requirements could be met promptty without the necessity of excessive
borrowing in advance to provide a margin of safety.
In the third place, these bills could be made to mature on the actual
rather than the nominal dates of tax collections. To Ulustrate: I t
should be possible to have adequate bill maturities on the 17th, 18th,
and 19th of March, for instance, at a time when income tax pa^^ments
are actually credited to the Treasury at the Federal reserve banks, as
contrasted with our certificates, all of which mature on the 15th of
March and most of which are presented for payment that day. The
280
REPORT ON THE FINANCES
effect of this would be to save the money market from the disturbance
which would take place every quarter day were it not for the special
intervention of the Federal reserve banks.
In the fourth place, the discount rate having been fixed by the
market itself, the securities having been bought for cash by those who
mean either to hold them as an investment or for secondary distribution, they would not be subjected to the same pressure as our
present certificates, which, being paid for by deposit .credit—itself
an inducement to subscribe—are frequently immediately resold at
less than par, with damage to the Government credit.
Fifth, ordinarily it would not be necessary to sell any considerable
amount of bills at times of temporary stringency and high money
rates, such, for instance, as prevailed in March of this year; and the
Treasur}^ would, on the other hand, be in a position to take full
advantage of periods of ease.
And, finally, the Government would, I think, get the full benefit
to be derived from furnishing to the public a new instrument for the
employment of temporary surplus funds, which, because of its
frequent and convenient maturities, should prove most popular.
In conclusion, let me emphasize that there is no intention to undertake anything revolutionary or to overturn a system which has
proved so eminently satisfactory in the past, but to supplement it
and improve it by rendering it more flexible, more closely adjusted to
our current financial needs, and more economical in its general operation; The success of our new program will depend, in large measure,
on the attitude of the bankers of the country. They have always
loyally cooperated with the Treasury in the past, and I trust you
wUl feel that the considerations I have just outlined carr}^ sufficient
weight to justify your whole-hearted cooperation and support in the
future.
EXHIBIT
13
[PUBLIC—No. 11—71ST CONGRESS—H. R .
1648]
An Act To amend section 5 of the second Liberty bond act, as amended
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled, T h a t section 5 of the second
Liberty bond act, as amended (United States Code, title 31, section
754), is hereby amended to read as follows:
' ' S E C . 5. (a) T h a t in addition to the bonds and notes authorized
by sections 1 and 18 of this act, as amended, the Secretary of the
Treasury is authorized to borrow from time to time, on the credit
of the United States, for the purposes of this act, to provide for the
purchase or redemption before maturity of any certificates of indebtedness or Treasury biUs issued hereunder, and to meet public expenditures authorized by law, such sum qr sums as in his judgment may
be necessary, and to issue therefor (1) certificates of indebtedness
of the United States at not less than par and at such rate or rates of
interest, payable at such, time or times as he may prescribe; or (2)
Treasury bills on a discount basis and payable at maturity without
interest. Treasury bills to be issued hereunder shall be offered for
sale on a competitive basis, under such regulations and upon such
SECRETABY OF THE TREASURY
281
terms and conditions as the Secretary of th,e Treasury may prescribe,
and the decisions of the Secretary in respect of any issue shall be final.
Certificates of indebtedness and Treasury biUs issued hereunder shall
be in such form or forms and subject to such terms and conditions,
shall be payable at such time not exceeding one year from the date of
issue, and may be redeemable before maturity upon such terms and
conditions as the Secretary of the Treasury may prescribe. Treasury
bills issued hereunder shall not be acceptable before maturity in
payment of interest or of principal on account of obligations of foreign
governments held by the United States of America. The sum of the
par value of such certificates and Treasury bills outstanding hereunder
and under section 6 of the first Liberty bond act shall not at any
one time exceed in the aggregate $10,000,000,000.
''(b) All certificates of indebtedness and Treasury bills issued
hereunder (after the date upon which this subdivision becomes law)
shall be exempt, both as to principal and interest, from all taxation
(except estate and inheritance taxes) now or hereafter imposed by
the United States, any State, or any of the possessions of the United
States, or by any local taxing authority; and the amount of discount
at which Treasury bills are originally sold by the United States shall
be considered to be interest within the meaning of this subdivision.
"(c) Wherever the words 'bonds and notes of the United States,'
or 'bonds and notes of the Government of the United States,' or
'bonds or notes of the United States' are used in the Federal reserve
act, as amended, they shall be held to include certificates of indebtedness and Treasury bills issued hereunder."
Approved, June 17, 1929.
TAXATION
E X H I B I T 14
" The Administration of the Federal Income Tax,^^ an address by Undersecretary of the Treasury MiUs before the Bar Association of the
State of New York, New York City, January 19, 1929
In recent weeks we have heard much discussion of the refunds of
Federal income taxes, coupled with a suggestion, in some quarters,
that they constitute a basis for criticism and suspicion of the administrative practices of the Treasury Department. The sound and wise
administration of our tax laws and faith in the integrity and wisdom
of those who administer them are of such vast importance to our
people that I feel that a discussion of what the Treasury is seeking to
accomplish in the way of reform will be of interest to a group of
professional men such as this.
Let me say, however, that it is neither my purpose nor desire to
promote or encourage the more active interest of lawyers as a class
in income tax matters. Quite the contrary. From my standpoint,
lawyers who like litigation—those representing the Government as
well as those representing taxpayers—have had altogether too much
to do with the income tax from the very outset. What was fundamentally an administrative problem developed almost at once into
an unlimited and interminable seiies of legal battles. The substitu-
282
REPORT ON THE FINANCES
tion of administration for litigation is the essence of our present
income tax problem.
Leaving aside the obvious political aspects and motives, the most
interesting feature of the recent criticism of the Treasury in connection with refunds is the insistence of our critics that, even though the
department, after careful consideration, has decided that the taxpayer
has paid more to the Government than he should, under the law^,
nevertheless, he must be compeUed to go to court to obtain what is
rightfully his. What they would do, in short, is to substitute our
Federal judges for the executive officers of Government charged with
the duty of collecting the revenue and have the income tax law
administered by the judicial rather than the executive branch of
Government. Such a proposal violates every sound rule of taxation
and of good government. It is the very bog from which the Treasury
seeks to extricate the income tax.
How did the recent discussion arise? The Commissioner of
Internal Revenue decided that the United States Steel Corporation
w^as entitled to a refund of $15,000,000, plus interest. To be sure,
this is a large sum, which seems to me to be utterly beside the point,
even leaving out of consideration the fact that this particular taxpayer paid $173,000,000 in taxes for the year in question, and that
if we were dealing in thousands rather than millions and with some
small corporation rather than the Steel Corporation, the question,
in all humaii probability, would never have been raised. To be
sure, the $975,000,000 of back tax refunds paid during the course of
the last 12 years is an immense sum, but the pubhc is not told that
during the same period the Government assessed more than $4,000,000,000 in back taxes and that refunds constitute but 2)^ per cent of
the total amount of $39,000,000,000 collected-^a very good showing,
indeed, if j o u take into consideration the enormous difficulties of the
war and early postwar period. Can it fairly be contended that it is
quite proper for the Government, after audit and review, to assess
$4,000,000,000 of additional taxes on the income taxpayers of the
country, but when, by the employment of the same methods, the
very same Government officials determine that the taxpayers have
paid more than they should, the latter should not be repaid except
by virtue of a court decision? Of course not. And if I am right,
the obvious, sound, and proper course to pursue is for the Commissioner of Internal Revenue to assume the responsibility of maldng
a decision, and when the decision is in favor of the taxpayer, to refund
the amount he determines to have been illegally collected. This
does not mean that some cases, where really doubtful points of law
are involved, will not have to be litigated, but they should be the
exception and not the rule.
What gives rise to refunds and why should taxpayers ever overpay
their tax? Under our income tax system the taxpayer prepares his
return and pays his tax as he estimates it to be. The Bureau of
Internal Revenue . audits his return and examines the various elements involved. I t then decides whether the return is correct or
whether the taxpayer has overestimated or underestimated his tax.
If underestimated, a deficiency is assessed; if overestimated, he is
entitled to a refund. The bureau's determination of a deficiency, of
course, is not and should not be final; so that, if he pays, he is then
entitled to seek a judicial determination and to claim a refund. Per
SECRETARY OF THE TREASURY
283
haps the best way to answer the second question, as to why any man
should ever be guilty of the folly of paying more in taxes than he
actually owes, is to give some actual illustrations.
Case No. 1.—Taxpayer A made his return, claiming a deduction of
$600,000, which was his pro rata share of the New York trainsfer tax
as a legatee of a deceased relative. Such a deduction was held
improper by the Supreme Court in the case ^ of Keith v. Johnson.
Thereafter the revenue act of 1928 was passed, and under the provisions of section 703 such a tax, if claimed as a deduction by the
legatee and not by the estate, was made an allowable deduction to the
legatee. Therefore a refund of $300,000 was made. .
Case No. 2.—Taxpayer B, on behalf of himself and the other stockholders, sold all the capital stock of a certain company, of which he
personally owned two-thirds, for a net price of $20,000,000. About
$15,000,000 was distributed to the stockholders, including the taxpayer. The remaining $5,000,000 was set aside to meet undetermined tax habilities of the corporation. Later, when these were
determined, the balance of this $5,000,000 was distributed to the
stockholders. The taxpayer reported his share of this balance in
the year when he received it. The bureau ruled that it was taxable
in the year of the original sale of the stock. Therefore a deficiency
was assessed for the year of sale, 1925, and an overassessment certified
for the year 1926, which was credited against the additional assessment for 1925.
Case No. 3.—Taxpayer C, a taxi corporation, originally claimed
depreciation at the rate of 1 cent a mile. Subsequently the actual
records of the life and total mileage of taxicabs showed that the correct rate of depreciation was 2 cents a mile. These records were
submitted and verified, and the result was refunds of $40,000 for 1924
and $50,000 for 1925.
Case No. 4-—Taxpayer D, a steamship corporation, failed to claim'
amortization on its original returns for 1918 and 1919. Later, within
the time as extended by Congress itself, claims were duly filed and
after careful audit were allowed, giving deductions of $700,000 for
1918 and $300,000 for 1919. The result was an overassessment of
$50,000 for 1918, which was credited against taxes for other years,
and a small balance refunded, and $20,000 refunded for 1919.
I t is apparent. from these illustrations, which were selected at
random, that neither the taxpayer nor the Government was to blame
for the situation creating the necessity for a refund. In the first
case the refund resulted from a change in the law; in the second,
from a misinterpretation of the law by the taxpayer; in the third,
from a more accurate ascertainment of the facts, which turned out
to be more- favorable to the taxpayer; in the fourth, to the failure
of the taxpayer upon his return to take advantage of a provision of
law enacted by Congress for his relief and later extended to him.
What I would emphasize is, that under a tax law which deals with
such a great variety of circumstances, reaches so many people, and
produces so much revenue, even under the most favorable conditions,
without any fault on the part of the taxpayer or the administrators,
cases must arise where the taxpayer finds that he has either overpaid
or underpaid the Government. If the first, he is entitled to be repaid;
if the second, the Government is entitled to an additional tax. In
neither case is there any occasion for criticism or for belief on the part
284
REPORT ON THE FINANCES
of the public that it is confronted with anything abnormal, unexpected,
or alarming. Quite to the contrary. If you were to examine our
revenue laws, you would realize at once the many constantly recurring
situations which can be met only by refunds and the many provisions
which can be administered, and must have been intended by Congress to be administered, solely by refunds. Furthermore, any
system of revenue collection under which payments are compelled
prior to final determinations must necessarily be based upon the
principle of refunding overpayments. This is true, for instance, of
the English system, which is frequently and properly pointed to as
a model of sound income tax administration, under which their
credits, drawbacks, and refunds amount to about 15 per cent of the
collections.
Refunds are but a part of a much larger problem. The present
discussion will have served a very useful purpose if it presents to the
country in a reasonably clear light the very definite and simple issue:
Should the income tax be treated as all other taxes, as an administrative problem with responsibility definitely lodged in the proper executive officers, or is it to be singled out and considered as not susceptible
of anything but judicial interpretation and decision? In so far as I
know, no other country has ever considered the assessment and collection of income taxes through the judiciary as necessary or advisable,
nor do I know of any case of an}^ one of our States taking such a
position, though many of them have enacted and enforced some
extremely complicated tax laws, particularly in the field of corporate
taxation. Though in the State and city of New York we raise
annually immense sums through taxes, I have never heard it suggested
that we could not trust the decision and judgment of our tax officials,
but must compel them to refer all doubtful questions, whether of law
or fact, to the courts. In the case of the Federal income tax, however,
it is undeniable that until recently there has been a very definite
tendency to lean heavily on the courts. Administrative officers have
been unwilling to assume the responsibilit}^ of making final decisions.
The Government has been inclined to settle all doubtful points in its
own favor and force the taxpayer to appeal to th'e court for relief;
while, on the other hand, the taxpayer, finding that the Government
was prepared to litigate all doubtful questions, found it very much to
his advantage to do likewise. Perhaps all this was unavoidable, considering the novelty of the problems presented, the intricate facts surrounding practically every transaction of importance, and the staggering amount of the sums involved. In any event, the attitude of
both the taxpayer and the Government was in large measure responsible for much of the delay in settling cases which has occasioned so
much complaint and for the protracted litigation which we have come
to associate with the income tax law, thus depriving this very sound
method of raising revenue of the two essential qualities of a sound tax,
namely, certainty and promptness.
Moreover, there grew up the strange fiction that questions which
by their nature are not susceptible of mathematical or logical determination could be settled with mathematical accuracy and pure
logic, leaving no room for the exercise of judgment. Attempts were
made to determine such questions as the valuation of natural resources,
the valuation.of intangibles, the amortization of war facilities, and
the computation of depreciation by the use of formulae and with
SECRETARY OF T H E TREASURY
,
285
mathematical accuracy. There persisted and persists to-day the
belief that the determination of a tax liability can be determined in
each case with precision and exactness, and if the bureau has any
doubt as to its ability to reach this ideal, it should let the Board of
Tax Appeals or the courts attempt it.
Now, the truth is that many questions can not be solved with exact
precision, and sound policy demands that they should be disposed of
by administrative action on the basis of the best judgment of competent officials. I t is true, of course, that important questions of law
must be left to the courts for determination, but, in so far as the great
mass of problems that arise are concerned, we can not hope to settle
them by a seiies of legal decisions. Experience has shown that conditions are so varied, complex, and changing that hardly a day goes by
without developing some new problem only remotely related to those
already decided. A final court decision five years from to-day is of
no help in reaching present-day determinations.
But, leaving aside all argument and theory, here are some facts
which indicate clearly enough the danger which threatens the income
tax in this country, a danger which no true friend of the system can
afford to minimize. After a strenuous and successful effort to bring
the work of the Bureau of Internal Revenue to a current basis, after
disposing of an accumulation of 3,000,000 cases, in accordance with
the old strict method, we found ourselves faced with over 22,000 cases,
involving over $700,000,000, pending before the Board of Tax
Appeals—five years' work, without taking into, consideration new cases.
The clean-up in the bureau was apparently not all that it appeared to
be. Difficult cases were evident^ being disposed of by driving the
taxpayer to the board, there to wait in patience and uncertainty.
What both the taxpayer and the Government want is to have the
case settled and closed, not simply transferred from the Bureau of
Internal Revenue to the Board of Tax Appeals. Obviously, litigation
is not the key to the successful administration of a tax law, which
each year reaches over 2,800,000 persons and produces annually over
$2,000,000,000. Moreover, we found that the Government was
successful in sustaining only about 50 per cent of the assessments
appealed to the board. What did this show? I t showed clearly
enough that the administrative officers were failing to assume the
responsibility which was theirs. The taxpayer was entitled to many
more decisions in his favor than they were iriaking. The trouble was
not, as has been suggested, excessive use of discretion on the part of
administrative officers, but a failure to exercise courageously their
own judgment and to dispose of these cases without the necessity of
court action.
To allow such a condition to continue, and grow worse, was to
subject the income tax law to such a storm of just criticism as would
inevitably bring it into disrepute. Accordingly, with the war years
pretty well back of us, with every prospect that we had reached a
period of stability where the law could be considered as in more or
less permanent form, we determined to return to sound tax principles and to treat the collection of an income tax as primarily an
administrative rather than a legal problem. The ideal we are aiming at is to have cases closed fairly, promptly, and finally. We want
to get away from the old spirit of claiming everything for the
Government and letting the taxpayer protect himself by litigation.
286
REPORT ON T H E FINANCES
We want the taxpayer to meet us halfway in a similar spirit of
fairness and with an appreciation that litigation, both for himself
and the Government, is the most unsatisfactory and expensive
method of determining his tax liability. All we want of him is what,
under the law, he owes the Government. As a plain matter of common sense, in the long run, how is that amount more likely to be
determined accurately and equitably? By mutual fairness, frankness, and full disclosure at the start, or by suspicion, secrecy, distrust
and arbitrariness, ending in litigation? Always remember that, in
the field of taxation, promptness, and certainty are frequentl}^ infinitely more important than meticulous accuracy.
Our immediate problem was to relieve the Board of Tax Appeals,,
w^hich was in serious danger of breaking down. In the summer of
1927 the so-called special advisory committee was created to apply
settlement methods not only to pending appeals but to cases in
which a 60-day letter had been sent out. The committee consists of
14 members and a number of conferees both in Washington and the
field. • These conferees are carefully chosen and trained. They
confer with the taxpayer and attempt primarily to settle cases where
facts are in dispute. The work accomplished during the course of
the last year has demonstrated the soundness and value of such a
method. In that period the committee has considered 5,748 appealed
cases and 2,777 cases about to be appealed. Of the appeals, 3,288,
and of the 60-day letter cases, 2,088 have been recommended for
settlement. The combined cases proposed for settlement resulted in
additional assessments totaling almost $37,000,000.
The success of this committee was such that early last year plans
were perfected for the creation of a similar agency in the general
counsel's office to attempt simUar settlement work in cases involving
primarUy questions of law and mixed questions of law and fact.
Many cases involved a number of issues, each of which is a fairly
close question of law without procedure and not of general importance. On'some of these questions the bureau may profitably yield
in exchange for similar concessions by the taxpayer. I t is, in a word,
the introduction into the realm of tax administration of a businesshke method for adjusting disputes. Litigation is proving expensive
and, on the average, unprofitable both to the taxpayer and to the
Government. Settlement methods serve to keep the tax problem on
an administrative basis, where it belongs, to reach results promptly,
with benefit to the Government and the taxpayer, and in the long run
to produce more revenue. These two agencies, no matter how effective they may prove to be, are necessarily limited in the scope of
their activities, but the success of their eft'orts, the educational work
which they are satisfactoril}^ contributing by bringing the conferees
and auditors into direct contact with them, the exchange of auditors,
meetings for general discussion, and the reading of the committee's
recommendations in specific cases are all contributing to the introduction of a new point of view^ and a new method of approach to the
solution of their problem in the bureau itself. If litigation is to be
avoided, if tax cases are to be settled with promptness and certainty,
the ultimate responsibility must definitely rest on the Bureau of
Internal Revenue. Its employees must recognize that responsiblity
and be willing to assume it and they must receive the wholehearted
support and encouragement of. those at the top. There need be no
fear of laxity, carelessness, or failure to protect the interests of the
SECRETARY OF THE TREASURY
287
Government. We are proceeding cautiously, slowl}^, and with adequate checks and review in all cases. The bureau is at least as well
equipped as the courts to reach sound determinations.
I do not want to convey the impression that what we are undertaking is something revolutionary. We are not compromising determined or admitted tax liabilities of solvent taxpa^yers. We are applying common sense to their determination. Once determined, every
penny must be paid. We are simply seeking to establish the administration of the income tax on the very definite basis on which it should
have rested from the start, on the very basis on which ever}'- tax
wliich has ever been imposed or collected in this or any other modern
country has rested. Nor do I want to raise your expectations too
high. Progress must necessarily be slow. An attitude of mind which
has existed for 10 years both on the part of the taxpayers and of
Government officials can not be changed over night. But we believe
we have made a good start in bringing about a general reform in the
field of Federal taxation. We can not succeed without public support.
That support will be lacking without a full understanding of what
we seek to accomplish. I know of no group of men that can be more
helpful than you gentlemen in promoting that understanding; and in
thanking you for your patience and courtesy this evening, I appeal
most earnestly for your whole-hearted assistance and support.
EXHIBIT
15
Statement by Secretary qf the Treasury MeUon concerning the publication qf refund decisions of the Commissioner of Internal Revenue
(press release, March 14, 1929)
The President has to-day signed an Executive order and has approved regulations prescribed by me.relating to the publication of
refund decisions of the Commissioner of Internal Revenue. Briefly,
the effect of the order and the regulations is that the Commissioner
of Internal Revenue will prepare a decision in every case in which an
overassessment (whether resulting in a refund, credit, or abatement)
of income, war-proflts, excess-profits, estate, or gift taxes in excess of
$20,000 is allowed. This decision will be accompanied by a brief
summary of the relevant facts and a citation of the applicable statutory and judicial authorities and will be open to inspection in the
office of the commissioner.
I t has been the consistent policy of the Treasury, a policy determined upon only after careful consideration and as to which ample
opportunities have been offered repeatedly for reconsideration, that
tax returns and the information thereon should under no circumstances be open to pubhc inspection. This policy is based upon the
principle that taxpayers should be permitted to contribute their share
of the revenue necessities of the Government without subjecting their
business afl'airs and transactions to the scrutiny of their competitors,
the idly curious, solicitors of contributions, and unscrupulous tax
practitioners seeking out possible future clients. This policy is not
aft'ected by the Executive order. The regulations specifically provide
that neither the return nor any part thereof shall be open to inspection, and, in addition the publication of the source of any income,
gains, or profits, or transactions resulting in losses or expenditures,
is specifically prohibited.
288
REPORT ON T H E FINANCES
The Congress adopted, as an amendment to the first deficiency
appropriation act, a provision which, as a matter of legal interpretation, would probably require no material change in the procedure
or practice of the Bureau of Internal Revenue. Furthermore, whatever effect might have been intended was, of course, limited to the
specific appropriations made by that act and would not be applicable
to any of the other appropriations available for making refunds.
The Treasury has entered serious objections to all so-called " p u b licity" proposals. The soundness of this position is reiterated.
However, in an eft'ort to dispel any misunderstanding that might have
arisen in the minds of the public because of the recent discussions of
the matter, the Treasury has undertaken to go much further than the
amendment requires. I t is believed that the publication of the decisions in the manner outlined above will, in a very short period of
time, show conclusively that the Treasury has nothing to hide in the
matter of tax refunds; that there is nothing mysterious about tax
refunds; that practically all refunds, credits, and abatements which
are allowed are attributable directly to such causes as decisions of
the courts or of the Board of Tax Appeals, overturning the Treasury
position or holding a provision of the statute unconstitutional, to
retroactive legislation, to uncertainties, ambiguities, or omissions in
the statute, to mathematical error, to factors which could not have
been determined at the time the tax was paid, or to the public-spirited
attitude of taxpayers in deciding doubtful questions against themselves at the time the tax is paid, relying upon a proper administrative policy in reaching a final determination of the amount properly
due; and that the refunding of overpayments of taxes is merely a
necessary part of the administration of our tax laws—in fact, an
essential corollary of any tax system founded upon the "payment
first" principle so frequently discussed. I t must not be forgotten
that our Federal tax-collection. system is founded upon the doctrine
that taxpayers may be compelled to pay the amount Government
officials determine to be due with no opportunity until after payment
for a review of that determination. I t is vital, and the interests of
taxpayers and the public generally properly demand as a necessary
protection, that when that review is afforded, whether it be administrative or judicial, the decision be carried out without undue delay.
The Executive order and the regulations are as follows:
EXECUTIVE ORDER
PUBLICATION OF INTERNAL REVENUE TAX REFUND DECISIONS
Pursuant to the provisions of section 55 of the revenue act of 1928
and section 257 of the revenue act of 1926, it is hereby ordered that
decisions of the Commissioner of Internal Revenue allowing a refund,
credit, or abatement of income, war-profits, excess-profits, estate, or
gift taxes in excess of $20,000 shall be open to inspection in accordance, and upon compliance, with the regulations prescribed by the
Secretary of the Treasury and approved by me, bearing even date
herewith.
HERBERT
T H E WHITE HOUSE,
March Uy 1929.
HOOVER.
SECRETARY OF THE TREASURY
289
(T. D. 4264) ^
AMENDING T . D . 3856—PUBLICATION OF INTERNAL R E V E N U E T A X
R E F U N D DECISIONS
TREASURY DEPARTMENT,
Washington, D. C.
To Collectors of Internal Revenue and Others Concerned:
T. D. 3856, as amended (being regulations prescribed by the
Secretary and approved by the President and applicable to the inspection of returns under the revenue act of 1928 and prior revenue acts),
is amended by adding at the end thereof the following new paragraph:
20. The Commissioner of Internal Revenue shall cause to be prepared a written
decision in every case in which an overassessment (whether resulting in a refund,
credit, or abatement) of an income, war-profits, excess-profits, estate, or gift
tax is allowed, in excess of $20,000, and such decision shall be considered a public
record and shall be open t o inspection, during regular hours of business, in t h e
office of the Commissioner of Internal Revenue or such office as he m a y designate.
Such decision shall give t h e a m o u n t of t h e overassessment a n d shall be accompanied by a brief s u m m a r y of t h e relevant facts a n d a citation of the authorities
applicable thereto, or, in a case in which a decision of a court or of the Board
of Tax Appeals has become final, by a citation of the court or Board decision.
Under no circumstances shall t h e provisions of this paragraph be construed as
making any return, or any p a r t thereof, open to inspection, or as authorizing
the source of any income, gains, or profits, or the specific transactions resulting
in losses or expenditures, to be made public; nor shall any of the information
contained in any return or relating thereto be m a d e public except in accordance
with, and to t h e extent necessary in carrying out, these regulations.
A. W. M E L L O N ,
Secretary of the Treasury.
Approved March 14, 1929.
H E R B E R T HOOVER.
T H E WHITE HOUSE.
O B L I G A T I O N S OF F O R E I G N G O V E R N M E N T S
Austria
EXHIBIT
16
Statement by Undersecretary of the Treasury Mills before the Ways and
Means Committee, December 7, 1928, submitting'a proposed agreement for the settlement of the relief indebtedness of Austria to the
United States (jpress release, December 7, 1928)
At the last session of Congress, in response to a message from the
President, House Joint Resolution 247 was introduced by Mr. Burton
and reported by the Ways and Means Committee to the House.
Under the terms of the resolution, the Secretary of the Treasury is
authorized, in cooperation with the other so-called relief creditor
governments, to subordinate the lien of the United States upon the
assetsand revenues of Austria pledged for the payment of the Austrian
relief bond held by the United States to a lien upon such assets and
revenues as may be pledged for the payment of one or more loans
floated by Austria in an aggregate net amount of not more than
725,000,000 Austrian schillings and for a period of not more than 30
years; and the Secretary of the Treasury is further authorized, with
7179^—30—FI 1929
^21
290
REPORT ON THE FINANCES
the approval of the President, to conclude an agreement for the settlement of the indebtedness of Austria to the United States. •
At the time of the hearing before the Ways and Means Committee
on House Joint Resolution 247 in April, 1928, negotiations for the
settlement of the Austrian debt with the relief creditors were proceeding, but inasmuch as there are nine relief creditors, and Austria
is obligated to settle with them all on the same basis, until an agreement with other creditors was actually reached, the Treasury Department was nojb in a position to submit to the Congress the terms of a
proposed agreement for the settlement of the relief indebtedness to
the United States.
Now, however, the settlement proposed by the Austrian Government has been accepted by seven of the nine creditor nations, namely,
Denmark, France, Great Britain, the Netherlands, Norway, Sweden,
and Switzerland. Negotiations with Italy, to whom Austria makes
a similar offer of settlement, are now being carried on. So that the
Secretary of the Treasury is at the present time enabled to submit
to the Congress the agreement for the settlement of the relief indebtedness of Austria to the United States, which he is prepared to execute
should the Congress grant him the authority.
The committee will remember that all of the relief bonds are of
simUar tenor and contain the following clause:
The Government of Austria agrees that no payment will be made upon or in
respect of any of the obligations of said series issued^ by the Government of
Austria before, at, or after, maturity, whether for principal or for interest, unless
a similar payment shall simultaneously be made upon all obligations of the said
series issued by the Government of Austria in proportion to the respective obligations of said series.
The terms of settlement, therefore, offered the United States are the
precise terms offered the other creditor governments and already
accepted by seven of them.
The principal of the indebtedness of Austria^ to the United States
amounts to $24,055,708.92. The bond matures by extension in 1943
and bears 6 per cent interest. With interest at 6 per cent, the total
indebtedness as of January 1, 1928, is $34,630,968.68. However,
the other relief creditors reduced the interest rate to 5* per cent on
January 1, 1925. If we make a corresponding adjustment in our
interest rate, the total indebtedness, principal and interest, as of
January 1, 1928, amounts to $33,911,904.39.
In settlement of this indebtedness, Austria offers to pay, beginning
on January 1, 1943, twenty yearly annuities of $1,337,140, reserving
the option, however, to substitute the foliow^ing schedule of payments:
Five yearly payments of $287,556, beginning January 1, 1929; 10
yearly payments of. $460,093, beginning Januaiy 1, 1934; and 25
yearly payments of $743,047, beginning January 1, 1944.
On a basis of 5 per cent, the present-day value of the smaller payments to be begun on January 1 next under the alternative schedule
is the same as that of the larger and postponed payments to be
begun January 1, 1943.
I may add that the Austrian Government has informed us it means
to exercise the option.
In this event, the payments are to be subject to the following
provision:
Provided, however, That if Austria shall exercise this option the obligation of
Austria to pay annuities during the years 1929 to 1943 will in the case of each
SECRETARY OF THE TREASURY
291
annuity not arise if the trustees of the reconstruction loan of 1923 prior to the
preceding December first have raised objection to the payment of the annuity in
question on the due date. To the extent, if any, that any such annuity is not
paid by reason of such objection on the part of the trustees, the amount thereof,
together with interest at 5 per cent per annum compounded annually to December
31, 1943, shall be repaid together with further interest at 5 per cent per annum
by twenty-five equal annuities on January 1 of each of the years 1944 to 1968,
inclusive. Austria shall issue its bonds to the United States for each of the
twenty-five annuities similar in form to the bonds first to be issued hereunder,
but dated January 1, 1943, bearing interest at the rate of 5 per cent per annum,
and maturing serially on January 1st of each succeeding year.
This provision is made necessary by the fact that under the terms
of the so-called Lodge Resolution priority over the lien which the
United States holds was granted to the bonds of the so-called reconstruction loan of 1923, which matures in 1943.
On a basis of 4K per cent, the present-day value of the payments
proposed under the option is 30.2 per cent of $33,911,904.39. This
total is reached, you will remember, by figuring interest at 6 per cent
to January 1, 1925, and 5 per cent to January 1, 1928. This compares
favorably with the present-day value of 24.6 per cent of the amount
due provided for in the debt settlement agreement with Italy and of
30.3 per cent in that with Jugoslavia. If, however, we figure past
interest on the basis, let us say, of the Belgian settlement, the total
amount owed is $30,383,562.70 and the present-day value of the
proposed payments is 33.7 per cent of this amount.
The Treasury feels that Austria's offer of settlement is a fair and
reasonable one. Austria is a. small country with very limited
resources. Her economic system was dislocated and torn apart by
the dismemberment of the old Austrian Empire. What was previously a large self-sufficient economic entity became a number of
independent units separated by political frontiers and trade barriers.
About one-third of a population of s©me 6,500,000 is concentrated in
the city of Vienna. About one-half of the total area of Austria is
used for agricultural purposes. The rest consists of forests and
unproductive land. WhUe progress is being made in agricultural
development, Austria does not produce enough for her own needs and
has to import large quantities of foodstuffs. There is iron ore in the
country, but the development of the steel and iron industry is handicapped by the entire lack of coal. This shortage of coal is a serious
handicap to industry and the large coal imports exercise an adverse
effect on trade balances. Austria has two important assets, extensive
forests, which have led to the building up of paper and paper products
industry, and abundant water power, which, however, needs capital
for development.
The trade balance has been consistently adverse. In 1926 imports
exceeded exports by $156,000,000; m 1927 by.$155,000,000. This,
of course, makes foreign payments over a term of years difficult, if
not impossible, were it not for the so-caUed invisible items, such as
tourists' expenditures, emigrant remittances, traffic receipts, etc.,
which up to the present time have been sufficient to offset the adverse
trade balance, to which must be added about $30,000,000 a year
which Austria has to send abroad to cover the service of her foreign
debts, including the reconstruction loan but not the relief debts.
Unemployment is a serious problem. At the end of 1925, 1926,
and 1927 there were over 200,000 unemployed. How low the standard
292
REPORT ON THE FINANCES
of living must be is indicated by an estimated per capita income of
only $157 and the following table of wages:
Wages of bricklayers and masons per week as of July, 1928:
Vienna....
Berlin.
London..
Philadelphia..
$9. 99
16. 25
20. 20
78. 00
__.___.
•_
Wages of metal workers in Vienna per week:
Skilled workers
Auxiliary workers.
Unskilled workers.
.
$10. 00
9. 00
7. 00
Relative real wages as of July, 1928, taken from the International
Labor Reviejw, which uses the London figures as the standard, are:
London-.
Philadelphia..
^ Prague
Vienna
.
_.
_.
_.-.
100
179
48
48
The revenue of the Federal Government as estimated in the 1929
budget amounts to $187,000,000, of which $38,000,000 are to be transferred to the Provinces and towns. Approximately $46,000,000 are
derived from direct taxes and approximately $141,000,000 from indirect taxes. The maximum income tax rate on individuals is 45 per
cent and the exemption $200. The corporation income tax rate is
25 per cent. Out of a population of some 6,500,000 there are 2,100,000
individuals paying income tax as compared with 2,471,000 in the
United States out of a population of 120,000,000. Of those paying
income tax, 610,000 report an income of $286 or less, 525,000 an income of $430 or less, 462,000 an income of $686 or less, 357,000 an
income of $1,460 or less, 105,000 an income of $3,100 or less, and 42,000
people report an income in excess of $3,100.
The public debts of Austria are as follows: Reconstruction loan,
$139,000,000; pre-war debts, $33,000,000; relief creditors, $178,000,000; owed to the national bank, $16,700,Q00, or a total of $366,700,000, to which must be added the debts of the Provinces and towns,
amounting to $72,000,000.^
The cost of the debt service amounts to $29,700,000 a year, of which
$22,700,000 must be paid abroad, to which foreign payments the payments on the debts of the Provinces and towns amounting to about
$8,000,000 should be added.
The budget has been balanced for the last three years, if we exclude
the amounts set aside for capital investments. Thus in 1927 the total
revenue amounted to $157,000,000, current expenditures amounted to
$141,000,000, but $20,000,000 in addition was spent on so-called productive investments such as railroad reconstruction. The currency
has been stabilized and the position of its nationaLbank.has been,
improving steadily.
The problem of payment of Austria's foreign relief debt is not primarily a budgetary but an economic one. As already'stated, in so
far as current expenditures are concerned, the budget can fairly be
said to be balanced. The difficulty is that, as explained to the committee last spring, Austria needs to expend a very considerable sum
for the rehabilitation of her physical plant, more particularly her railroad, telephone, and telegraph lines. The Austrian budget is not
SECRETARY OF T H E TREASURY
293
adequate to furnish the necessary funds. The private capital available for investment in Austria is totally inadequate. I t is necessary,
therefore, for Austria to borrow the needed capital abroad, and this
can not be done unless the investments are productive and, secondly,
unless the character of the investments themselves is such as to furnish
the means of meeting interest and sinking fund payments abroad in
foreign currencies. Austria must increase her productive capacity.
In order to increase her productive capacity she must have new capital
frora abroad. She can not obtain that new capital from abroad unless
the rehef creditors are willing to enable her to do so by making a
reasonable settlement of the existing indebtedness. From which it
follows' that an unreasonable and exacting attitude on the part of her
creditors may well impair their own ability ultimately to collect their
debt when it falls due jn 1943.
No one knows better than the members of this committee how impossible it is to estimate with any exactitude capacity to pay. The
facts and figures presented are not conclusive, but they do serve to
outline the general situation and indicate clearly enough that Austria
is not in a position to meet heavy payments.
In this connection, it can not be overlooked that the European
creditors, who presumably are more famUiar with Austria's capacity
than we are and whose own needs are certainly greater than ours, have
agreed that this is all that Austria can fairly be asked to pay. Taking
this as well as all other circumstances into consideration, the State
and Treasury Departments are strongly of the opinion that Austria's
offer should be accepted.
The proposed settlement has been submitted to the former members
of the Foreign Debt Commission who are in Washington and met with
their unanimous approval.
I submit herewith the proposed agreement and the proposed terms
of renewal bonds, together with a list of relief creditors, the amounts
owed each, and the amounts they will receive under the terms of the
settlement.
AGREEMENT
Made the
day of
—, 1929, at the city of Washington, District
of Columbia, between the Federal Government ofthe Republic of Austria,
hereinafter called Austria, party of the first part, and the Government
qf the United States of America, hereinafter called the United States,
party of the second part
Whereas Austria is indebted to the United States as of January 1,
1928, upon an obligation designated as bond No. 1, relief series B of
1920, in the principal amount of $24,055,708.92, together with interest
accrued and unpaid thereon; and
Whereas Austria desires to liquidate said indebtedness to the
United States, both interest and principal, through the issue of bonds
to the United States, and the United States is prepared to accept
bonds from Austria upon the terms hereinafter set forth;
Now, therefore, in consideration of the premises and of the mutual
covenants herein contained, it is agreed as follows:
294
REPORT ON T H E FINANCES
1. Amount qf indebtedness.—The amount of indebtedness to be
liquidated is $34,630,968.68 which has been computed as follows:
Principal of relief obligations
$24, 055, 708. 92
Accrued and unpaid interest from September 4, 1920, to January 1, 1928, at 6 per cent per annum
10, 575, 259. 76
Total indebtedness as of January 1,1928
34, 630, 968. 68
2. Payment.—In order to provide for the liquidation .of the indebtedness, Austria agrees to pay and the United States to accept the
sum of $33,428,500, to be paid in twenty-five equal annual installments
of $1,337,140 each, on the first day of January, 1943, and on the first
day of January of each of the subsequent years to 1967, inclusive.
In lieu of these twenty-five payments Austria may, at its option, issue
to the United States, at par, bonds of Austria in the aggregate principal amount of $24,614,885, dated January 1, 1928, and maturing
serially on the several dates and in the amounts fixed in the following
schedule:
January 1:
1929..
1930.
19311932.
19331934.
1935.
19361937.
1938.
1939.
19401941.
1942.
1943194419451946.
194719481949.
$287, 556.
287, 556.
287, 556.
287, 556.
287, 556.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
460, 093.
743, 047.
743, 047.
743, 047.
743, 047.
743, 047.
743, 047.
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
January 1—Continued.
1950
1951
1952-1953
1954
1955
1956
1957- —_-_
1958
1959
:
1960
1961
1962
-__
1963
1964
1965
1966
1967
1968
-___
$743, 047. 00
743,047.00
743,047. 00
743, 047. 00
743, 047. 00
743,047.00
743, 047. 00
743, 047. 00
743, 047. 00
743, 047. 00
743, 047. 00
743,047.00
743, 047. 00
743,047.00
743, 047. 00
743, 047. 00
743, 047. 00
743, 047. 00
743, 047. 00
24, 614, 885. 00
Provided, however, That if Austria shall exercise this option, the
obligation of Austria to pay annuities during the years 1929 to 1943
will in the case of each annuity not arise if the trustees of the reconstruction loan of 1923 prior to the preceding December first have
raised objection to the payment of the annuity in question on the
due date. To the extent, if any, that any such annuity is not paid
by reason of such objection on the part of the trustees, the amount
thereof together with interest at 5 per cent per annum compounded
annually to December 31, 1943, shall be repaid together with further
interest at 5 per cent per annum by twenty-five equal annuities on
January 1 of each of the years 1944 to 1968 inclusive. Austria shall
issue its bond to the United States for each of the twenty-five annuities similar in form to the bonds first to be issued hereunder, but dated
January 1, 1943, bearing interest at the rate of 5 per cent per annum,
and maturing serially on January 1st of each succeeding year.
Austria agrees that no payment shall be made upon or in respect
of any of its obligations issued to the relief creditor nations, to wit,
Denmark, France, Great Britain, Holland, Italy, Norway, Sweden,
and Switzerland, before, at, or after maturity, whether for principal
SECRETARY OF THE TREASURY
295
or for interest, unless a similar and proportionate payment shall
simultaneously be made upon the relief indebtedness of Austria to
the United States as set forth above.
3. Form of bond.—All bonds issued or to be issued hereunder to the
United States shall be payable to the Government of the United States
of America, or order, and shall be signed for Austria by its duly authorized representative. The bonds to be dated January 1, 1928, and
maturing January 1, 1929, and annually thereafter to January 1,
1943, inclusive, shall be substantially in the form set forth in the
exhibit hereto annexed and marked "Exhibit A," and shall be issued
in fifteen pieces with maturities and in denominations as hereinabove
set forth and shall bear no interest except that in the event that any
bond is not paid on the date of its maturity, interest shall be paid as
specified in paragraph 2 above. The bonds to be dated January 1,
1928, and maturing January 1, 1944, and annually thereafter to
January 1, 1968, inclusive, shall be substantially in the form set forth
in the exhibit hereto annexed and marked "Exhibit B , " and shall
be issued in twenty-five pieces with maturities and in denominations
as hereinabove set forth and shall bear no interest.
4. Method of payment.—All bonds issued or to be issued hereunder
shall be payable, as to both principal and interest, in United States
gold coin of the present standard of value, or at the option of Austria,
upon not less than thirty days' advance notice to the United States,
in any obligations of the United States issued after April 6, 1917, to
be taken at par and accrued interest to the date of payment hereunder.
All payments, whether in cash or in obligations of the UnitedlStates,
to be made by Austria on account of the principal of or interest on
any bonds issued or to be issued hereunder and held by the United
States, shall be made at the Treasury of the United States in Washington, or, at the option of the Secretary of the Treasury of the
United States, at the Federal Reserve Bank of New York, and if in
'Cash shall be made in funds immediately avaUable on the date of
maturity, or if in obligations of the United States shall be in form
acceptable to the Secretary of the Treasury of the United States
under the general regulations of the Treasury Department governing
transactions in United States obligations.
5. Exemption from taxation.—The principal and interest of all
bonds issued or to be issued hereunder shall be paid without deduction
for, and shall be exempt from any and all taxes or other public dues,
present or future, imposed by or under authority of Austria or any
political or local taxing authority within Austria.
6. Security.—Austria represents that the Reparation Commission,
pursuant to the powers conferred upon it, has recognized that the
bonds to be issued under this agreement shall enjoy the same security
;as the bonds of relief series B of 1920, and shall be a first charge upon
all the assets and revenues of Austria, and shall have priority over
•costs of reparation under the Treaty of Saint-Germain, or under any
treaty or agreement supplementary thereto, or under any arrangements concluded between Austria and the Allied and Associated
Powers during the armistice signed on November 3, 1918, and the
Austrian Government agrees that nothing in this agreement shall
prejudice or affect the provisions contained in the bonds of relief
series B of 1920 constituting such bonds a first charge upon all the
assets and revenues of Austria (without prejudice, however, to the
296
REPORT ON T H E FINANCES
lien enjoyed by the reconstruction loan of 1923), so that if the Government of Austria should a t any time without the assent of the holder
of this bond pay or attempt to pay any sum whether in respect of
reparation or by way of compensation for any nonfulfillment of the
obligations of Austria under article 184 of the said treaty, the amount
owing under the terms of bond No. 1, relief series B of 1920, for
principal moneys and for any arrears of interest thereon at 6 per cent
per annum, compounded semiannually from September 4, 1920, to
January 1, 1925, and thereafter at 5 per cent per annum, compounded
annually, shall forthwith be paid in cash by the Austrian Government
in priority to any such payments under the said treaty.
7. Compliance with legal requirements.—Austria represents and
agrees that the execution and delivery of this agreement have in all
respects been duly authorized and that all acts, conditions, and
legal formalities which should have been completed prior to the
making of this agreement have been completed as required by the
laws of Austria and in conformity therewith.
8. Cancellation and surrender of obligations.—Upon the execution
of this agreement, the delivery to the United States of the principah
amount of bonds of Austria to be issued hereunder, together with
satisfactory evidence of authority for the execution of this agreement by the representative of Austria and for the execution of the
bonds to be issued hereunder, the United States will cancel and surrender to Austria at the Treasury of the United States in Washington
the relief obligation of Austria now held by the United States.
9. Notices.—Any notice, request, or consent under the hand of the
Secretary of the Treasury of the United States shall be deemed and
taken as the notice, request, or consent of the United States and
shall be sufficient if delivered at the legation of Austria at Washington or at the office of the Ministry of Finance at Vienna; and any
notice, request, or election from or by Austria shall be sufficient if
delivered to the American legation at Vienna or to the Secretary of
the Treasury at the Treasury of the United States in Washington.
The United States in its discretion may waive any notice required
hereunder, but any such waiver shall be in writing and shall not
extend to or affect any subsequent notice or impair any right of the
United States to require notice hereunder.
10. Counterparts.—This agreement shall be executed in two counterparts, each of which shall have the force and eft'ect of an original.
In witness whereof Austria has caused this agreement to be executed on its behalf by its duly authorized representative at Washington, and the United States has likewise caused this agreement to
be executed on its behalf by the Secretary of the Treasury, with the
approval of the President, pursuant to the act of Congress approved
, all on the day and the year first above written.
T H E FEDERAL GOVERNMENT OF THE
REPUBLIC OF AUSTRIA,
By
.
T H E GOVERNMENT OF THE
U N I T E D STATES OF AMERICA,
By
,
Secretary of the Treasury.
Approved.
President.
SECRETARY OF T H E TREASURY
297
EXHIBIT A
(Form of bond 1929-1943)
The Republic of Austria, Series B-1920, No.
(renewal bond)
The Republic of Austria, hereinafter called Austria, for value received, promises to pay to the Government of the United States of
America, hereinafter called the United States, or order, on January
1,
, the sum of
dollars ($
). This bond is payable
as to both principal and interest in gold coin of the United States of
America of the present standiard of value or, at the option of Austria,
upon not less than thirty days' advance notice to the United States,
in any obligations of the United States issued after April 6, 1917, to
be taken at par and accrued interest to the date of payment hereunder. Nevertheless, the obligation of Austria to pay this bond
shall not arise if the trustees of the League of Nations loan have,
prior to the first day of December preceding the maturity date of
. this bond, raised objection to the payment of this bond on the due
date. If this bond is not paid on its due date by reason of such
objection on the part of the trustees, the amount thereof, together
with interest at 5 per cent compounded annually to January 1, 1943,
shall be repaid, together with further interest at 5 per cent in twentyfive equal annual installinents on the first of January of each of the
years 1944 to 1968, inclusive.
This bond is payable as to both principal and interest without
deduction for, and is exempt from, any and all taxes and other
charges, present or future, imposed by or under authority of Austria
or its possessions or any political or taxing authority within Austria.
This bond is payable as to both principal and interest at t h e Treasury of the United States in Washington, D. C , or at the option of
the Secretary of the Treasury of the United States at the Federal
Reserve Bank of New York.
This obligation is one of a series of obligations of similar tenor, but
in different amounts and payable in different currencies, designated
as "Relief series B of 1920 (renewal bonds)."
Austria agrees that no payment wUl be made upon or in respect
of any of the obligations of the "Relief bond series B-1920" due on
January 1, 1925, or upon or in respect of any of the .obligations
^'Relief series B of 1920 (renewal bonds)" or of any other obligations
issued by Austria in renewal of the said "Relief bonds series B - 1 9 2 0 "
before, at, or after maturity, whether for principal or for interest,
unless a similar payment shall simultaneously be made upon all the
obligations of "Relief series B of 1920 (renewal bonds)" issued by
Austria in proportion to the respective obligations of said series.
The payment of this obligation is secured in the same manner and
to the same extent as the obligation of Austria in the principal amount
of $24,055,708.92, designated as bond No. 1, relief series B of 1920.
Austria agrees that if at any time it should pay or attempt to pay
any sum, whether in respect of reparation or by way of compensation for any nonfulfillment of the obligations of Austria under article
184 of the said treaty, the amount owing under the terms of bond
No. 1, relief seiies B of 1920 for principal moneys and for any arrears
of interest thereon at 6 per cent per annum, compounded semiannu-
298
REPORT ON THE FINANCES
ally from September 4, 1920, to January 1, 1925, and thereafter at
5 per cent per annum, compounded annually, shall forthwith be paid
in cash by the Austrian Government in priority to any such payments
under the said treaty.
This bond is issued under an agreement dated
between
Austria and the United States, to which this bond is subject and to
which reference is made for a further statement of its terms and
conditions.
In witness whereof Austria has caused this bond to be executed
in its behalf at the city of Washington, District of Columbia, by its
duly authorized representative at Washington.
T H E GOVERNMENT OF THE
R E P U B L I C OP AUSTRIA,
By
.
Dated January 1, 1928.
EXHIBIT
B
(Form of bond 1944-1968)
The Republic of Austria, Series B-1920, No.
(renewal bond)
The Republic of Austria, hereinafter called Austria, for value
received, promises to pay to the Government of the United States of
America, hereinafter caUed the United States, or order, on January 1,
- , the sum of
: dollars ($
). This bond is payable
as to both principal and interest in gold coin of the United States of
America of the present standard of value, or, at the option of Austria,
upon not less than thirty days' advance notice to the United States.
in any obligations of the United States issued after April 6, 1917, to
be taken at par and accrued interest to the date of payment hereunder.
This bond is payable without deduction for, and is exempt from,
any and all taxes and other charges, present or future, imposed by
or under authority of Austria or its possessions or any political or
taxing authority within Austria. This bond is payable as to both
principal and interest at the Treasury of the United States in Washington, D.^C, or at the option of the Secretary of the Treasury of the
United States at the Federal Reserve Bank of New York.
This obligation is one of a series of obligations of similar tenor b u t
in different amounts and payable in different currencies, designated as
"Relief series B of 1920 (renewal bonds)."
Austria agrees that no payment wiU be made upon or in respect of
any of the obligations of the "Relief bond series B-1920" due on
January 1, 1925, or upon or in respect of any of the obligations
"Relief series B of 1920 (renewal bonds)" or of any other obligations
issued by Austria in renewal of the said "Rehef bonds series B-1920'^
before, at, or after maturity, whether for principal or for interest,
unless a similar payment shall simultaneously be made upon all the
obligations of "Relief series B of 1920 (renewal bonds)" issued by
Austria in proportion to the respective obligations of said series.
The payment of this obligation is secured in the same manner and
to the same extent as the obligation of Austria in the principal amount
of $24,055,708.92, designated as bond No, 1, relief series B of 1920.
299
SECRETARY OF T H E TREASURY
Austria agrees that if at any time it should pay or attempt to pay
any sum whether in respect of reparation or by way of compensation
for any nonfulfilment of the obligations of Austria under article 184
of the said treaty, the amount owing under the terms of bond No. 1,,
relief series B of 1920 for principal moneys and for any arrears of
interest thereon at 6 per cent per annum, compounded semiannually
from September 4, 1920, to January 1, 1925, and thereafter at 5 per
cent per annum, compounded annually, shall forthwith be paid in
cash by the Austrian Government in priority to any such payments
under the said treaty.
This bond is issued under an agreement dated
between
Austria and the United States, to which this bond is subject and to
which reference is made for a further statement of its terms and
conditions.
In witness whereof, Austria has caused this bond to be executed in
its behalf at the city of Washington, District of Columbia, by its
duly authorized representative at Washington.
THE
GOVERNMENT
OF THE R E P U B L I C
OF AUSTRIA,
By
- .
Dated January 1, 1928.
Relief debt (in dollars)
Settlement
Original
debt
D e b t on
J a n . 1,1928 i
1929-1933
Denmark . _
France
England
Netherlands
Norway
Sweden
Switzerland _
Italy
U n i t e d States
Total
1934-1943
1944-1968
Total
321,618
17,607,331
44,024, 618
6, 720,974
415,186
19,889
4, 639,898
22, 210,897
24, 055, 709
476,833
26, 072, 503
65, Oil, 610
9, 689, 425
635, 995
29, 059
6,893, 338
31,427, 617
35, 966, 461
19,032
1, 042, 260
2, 598, 868
387, 340
25,424
1,161
275, 565
1, 256, 307
1, 437, 780
60,998
3, 335, 256
8, 316, 415
1, 239, 494
81, 358
3,717
881,812
4, 020, 200
4, 600,950
246, 278
13, 466, 090
33, 577, 511
5, 004,455
328,483
15, 008
3, 560, 315
16, 231, 550
18, 576,175
326,337
17, 843, 610
44, 492, 795
6, 631, 289
435, 265
19,887
4, 717, 692
21, 508, 057
24,614,175
120, 016,120
174, 202,841
7, 043, 737
22, 540, 200
91,005,865
120, 689,107
1 Interest included on basis of the rate of 6 per cent per annum, compounded semiannually to Jan. 1,1925,
and thereafter of the rate of 5 per cent per annum, compounded annually.
EXHIBIT
[PUBLIC
17
R E S O L U T I O N — N o . 8 1 — 7 0 T H C O N G R E S S — H . J. R E S . 340]
J o i n t Resolution T o a u t h o r i z e t h e Secretary of t h e T r e a s u r y t o c o o p e r a t e w i t h
t h e o t h e r relief creditor G o v e r n m e n t s in m a k i n g it possible for A u s t r i a t o float
a loan in order t o o b t a i n funds for t h e f u r t h e r a n c e of its r e c o n s t r u c t i o n program,,
a n d t o conclude a n a g r e e m e n t for t h e s e t t l e m e n t of t h e i n d e b t e d n e s s of A u s t r i a
to the United States
Resolved by the Senate and House of Representatives of the United
States of America in Congress assembled, That in order that t h e
United States may cooperate with the Governments of Denmark,
France, Great Britain, Italy, the Netherlands, Norway, Sweden, and
Switzerland in making it possible for Austria to obtain by means of
a loan the additional funds necessary in the furtherance of its recon-
300
REPORT ON T H E FINANCES
struction program, the Secretary of the Treasury is hereby authorized, if he determines that substantially similar action has been
taken by each of such Governments in respect of the Austrian relief
bonds held by it and that the Reparation Commission has given an
appropriate release in respect of such loan, to subordinate the hen
of the United States upon the assets and revenues of Austria pledged
for the payment of the Austrian relief bond held by the United
States (but without prejudicing the priority over costs of reparation stipulated in the relief,bond) to a lien upon such assets and
revenues as may be pledged for the payment of one or more loans
floated by Austria in an aggregate net amount of not more than
725,000,000 Austrian schillings and for a period of not more than
thirty years from July 1, 1929; and the Secretary of the Treasury,
with the approval of the President, is hereby authorized to conclude
an agreement, as set forth below in general terms, for the settlement
of the indebtedness of Austria to the United States: Provided, however. That the terms and conditions of such settlement shall' not be
less favorable than the terms and conditions granted by Austria to
any of ^he other relief creditor Governments, and should more favorable terms or conditions be granted by Austria to any of the other
relief creditor Governments, the Secretary of the Treasury, with the
approval of the President, is authorized to amend the proposed agreement so that the United States may enjoy a corresponding benefit.
The amount of the indebtedness to be funded is $34,630,968.68, which has been
computed as follows:
Principal amount of obligation to be funded
$24, 055, 708. 92
Interest accrued and unpaid thereon to January 1, 1928, at
the rate of 6 per centum per annum
10, 575, 259. 76
Total principal and interest accrued and unpaid as of
January 1, 1928
34, 630, 968. 68
In full and final settlement of this indebtedness, Austria shall pay
twenty-five equal annuities of $1,337,140 beginning on January 1,
1943.
Austria, however, shall have the option of paying instead of the
aforesaid annuities forty annuities as follows: Five annual payments of $287,556 beginning on January 1, 1929; ten annual payments of $460,093 beginning on January 1, 1934; and twenty-five
annual payments of $743,047 beginning on January 1, 1944.
If Austria shall exercise this option to pay in forty annuities
beginning January 1, 1929, the obligation of Austria to pay annuities during the years 1929 to 1943 wUl in the case of each annuity
not arise if the trustees of the reconstruction loan of 1923 prior
to the preceding December 1 have raised objection to the payment
of the annuity in question on the due date. To the extent, if any, that
any such annuity is not paid by reason of such objection on the
part of the trustees, the amount thereof together with interest at
5 per centum per annum compounded annually to December 31,
1943, shall be repaid together with further interest at 5 per centum
per annum by twenty-five equal annuities on January 1 of each of
the years 1944 to 1968, inclusive.
The bonds to be issued under the agreement to be concluded under
authority of this resolution shall enjoy the same security as the
relief obligation of Austria now held by the United States (relief
series B of 1920) except to the extent that the lien enjoyed by this
SECRETARY OF THE TREASURY
301
obligation has been released by the Secretary of the Treasury under
authority of the joint resolution of Congress approved April 6,
1922, and also to the extent that it may be further released by the
Secretary of the Treasury under the authority of this resolution.
Austria shall make no payment upon or in respect of any of its
obligations issued to the relief creditor nations, to wit, Denmark,
France, Great Britain, the Netherlands, Italy, Norway, Sweden,
and Switzerland before, at, or after maturity, whether for principal
or for interest, unless a similar and proportionate payment shall
simultaneously be made upon the relief indebtedness of Austria to the
United States.
•
'
Any payment to be made under the agreement may be made at
the option of Austria in any United States Government obligations
issued after AprU 6, 1917, such obligations to be taken at par and
accrued interest.
Approved, February 4, 1929.
France
EXHIBIT
18
[PUBLIC RESOLUTION—No. 20—71ST CONGRESS]
[H. J.
Res. 80]»
Joint Resolution Authorizing the postponement of the date of maturity of
the principal of the indebtedness of the French Republic to the United
States in respect of the purchase of surplus war supplies.
Resolved by the Senate and House of Representatives of the United
States of America in Congress assembled, T h a t in the event t h a t the
agreement between the French Republic and the United States
(known as the Mellon-Berenger agreement) made on behalf of the
United States by the World War {Foreign Debt Commission and
approved by the President, providing for the funding and payment
of the indebtedness of the French Repubhc to the United States is
ratified in France in accordance with the terms thereof, prior to
August 1, 1929, the Secretary of the Treasury, with the approval of
the President, is authorized to enter into an agreement with the
French Republic providing for the postponement of the date of the
rnaturity of the principal of its indebtedness in respect of its purchase
of surplus war supplies, until the Mellon-Berenger agreement has
been approved or disapproved by the Congress, but in no event shall
such date be postponed beyond May 1, 1930. Such agreement shall
not be entered into unless the French Republic agrees to pay the
interest upon such indebtedness upon August 1, 1929, and February
1, 1930, but the amounts paid as interest shall be credited against
the amounts first due under the Mellon-Berenger agreement, if such
agreement is approved by the Congress.
Approved, October 17, 1929.
V Passed House and Senate on June 19,1929, bu4; in the haste of adlournment was not signed at that time
by the Speaker of the House and the- President of the Senate.
302
REPORT ON THE FINANCES
EXHIBIT
19
Statement of the President qf the United States concerning the ratification by France of the agreement for the settlement of the French indebtedness to the United States (press release, July 28, 1929)
I am very much gratified to learn that France has ratified the agreement providing for the settlement of the debt of the French Republic
to the United States,'thus disposing, in so far as lies within her power,
of one more of the great financial problems left over by the World
War. With the high sense of honor and financial responsibility that have
always characterized the actions of the French people, it was always certain that to the full extent of their ability they would meet their obligations. The definite settlement ofthe amounts to be paid in complete
discharge of this debt is cause for mutual satisfaction, removing as
it does a question that has occasioned much controversy and debate.
The settlement calls for payments of $35,000,000 in the fiscal year
1930, gradually rising over a period of eleven j^ears until they reach
a maximum of $125,000,000 annually.
I think in fairness to the American people I am justified in mentioning the liberality of the settlement, The total debt of the French
Republic to the United States as of June 15, 1925, was approximately
$4,230,000,000. On a 5 per cent basis, which is the rate of interest
borne by the obligations given by the French Governm.ent, the present
value of the payments provided for by the Mellon-Berenger agreement is $1,681,000,000, or, in other words, a reduction of approximately 61 per cent of the total indebtedness. This settlement in
effect wipes out the entire indebtedness of France which arose during
the war period and simply provides for the payment of advances to
France after the armistice, which aggregate, including accrued interest, $1,655,000,000. While some of the after armistice advances
were made for the liquidation of obligations incurred in this country
by the French Government during the war, considerable advances
during the war period itself were for permanent improvements; for
shipping; for the meeting of obligations to private creditors incurred
prior to the entrance of the United States into the war, and advances
to the Bank of France for credit and exchange purposes.
I am giving these facts so that in recognition of the honorable way
in which France has to meet its obligations, they will understand that
our people, too, feel that this settlement involves a measure of sacrifice on their part. There is every reason to hope and believe that such
an agreement, based as it is on mutual sacrifice and consideration,
can not but promote a better understanding between these two great
nations and serve further to cement a friendship that has lasted for
a century and a half.
E'^HIBIT 20
Statement of Secretary of the Treasury MeUon concerning the ratification
by France of the agreement for the settlement of the French indebtedness
to the United States (press release, July 28, 1929)
1 am greatly pleased at the action of France in ratifying the agreement for the settlement of the debt owed by her to the United States.
Under this a,gr.eement France undertakes to meet her obligations and
SECRETARY OF THE TREASURY "
303
by so doing, gives evidence of that financial integrity which has
always characterized her conduct.
As one who helped to negotiate the agreement for the settlement, I
feel that much credit is due to the frankness shown by those representing France in disclosing all the factors involved in arriving at an
estimate of their country's capacity to pay. The American Commission approached the situation with equal frankness and good will,
and the settlement subsequently arrived at is one which we believe
is eminently fair to both nations.
I t involved, of course, some sacrifice on the part of both France
and the United States. But the amount which it was agreed that
France could pay was determined without taking into consideration
Any payments from reparations or other such outside sources; and
the astonishing financial and economic recovery which France has
made, even in the short period intervening since the agreement was
negotiated, is convincing evidence that great hardship will not be
imposed on France in meeting the payments to America. Furthermore, I am convinced, as I was three years ago when the settlement
was made, that the burden which it involves as regards the French
people will grow lighter, relativel}^ speaking, as time goes on.
By ratifying this agreement France has now eliminated in the
relations of the two countries a matter which was disturbing so long
as"it remained unsettled. At the same time this action, by disposing
of one of the last financial problems inherited from the war, will make
for world stability and will prove a powerful factor in promoting
general economic progress.
In so far as this country is concerned, it brings to a successful conclusion the task entrusted to the World War Foreign Debt Commission to negotiate settlements with the various nations for the debts
incurred during and after the war. Agreements have been reached
with Great Britain, Finland, Hungary, Lithuania, Poland, Belgium,
Czechoslovakia, Latvia, Estonia, Italy, Yugoslavia, Rumania, Greece,
and France, bringing the total amount which has been funded to
date to $11,554,851,000. All of these nations are punctually meeting
their engagements; and the payments, as they are received, are being
applied on the debt owed by this Government to its bondholders.
E X H I B I T 21
Text of the notes exchanged between Secretary of the Treasury Mellon and
the French ambassador constituting the agreement between France a n d
the United States providing for the postponement of the date of the
maturity of the principal of the indebtedness of France in respect
of its purchase of surplus war supplies maturing August 1,1929 (j>ress
release, July 31, 1929)
JULY 29,
1929.
M Y D E A R M R . AMBASSADOR: The agreement between the French
Republic and the United States, known as the Mellon-Berenger
agreement, providing for the funding of the payment of the indebtedness of the French Republic to the United States, has been ratified
in France in accordance with the terms thereof, but has not as yet
received the approval of the Congress of the United States. The
said agreement having been ratified by the Government of the French
3.04
• REPORT ON T H E FINANCES
Republic, the Secretary of the Treasury, with the approval of the
President, hereby agrees with the French Republic to the postponement of the date of the maturity of the principal of its indebtedness
in respect of its purchase of surplus war supplies maturing August 1,
1929,. until the Mellon-Berenger agreement has been approved or
disapproved by the Congress of the United States, but in no event
shall such date be postponed beyond May 1, 1930. The Congress
will reconvene shortly, and it is my expectation that the MellonBerenger agreement will receive consideration at an early date.
I t is understood that the French Republic agrees to continue to pay
interest on the said obligations maturing August 1, 1929, in accordance with the terms thereof, until payment, provided, however, that
if the Mellon-Berenger agreement is approved by the Congress of the ^
United States prior to May 1, 1930, such amounts paid as interest*
prior to that date will be credited to the first annuities specified in the
Mellon-Berenger agreement. I t is further understood that in the
event of the approval of the MeUon-Berenger agreement by the
Congress of the United States the French Republic, within a reasonable time thereafter, will pay to the United States such additional
amount as may be necessary to bring to a current basis the payments
due up to that time under the terms of the Mellon-Berenger agreement.
I shall appreciate it if you will transmit this communication to your
Government with the suggestion that your Government authoriz'e
you to signify in writing its acceptance of this agreement and that
this exchange of letters constitutes a definite and binding agreement
between the two Governments.
With assurance of my esteem, I am.
Sincerely yours,
A. W.
MELLON,
Secretary of the Treasury.
His ExceUency, the AMBASSADOR OF FRANCE,
French Embassy, Washington, D. C
Approved.
H E R B E R T HOOVER,
President.
WASHINGTON, July 29, 1929.
I have the honor to acknowledge
receipt of your letter of July 29 concerning the report of the date
of payment of the obligations contracted by France toward the
United States for the purchase of war stocks and coming to maturity
on August 1, 1929.
\
I take pleasure in informing you, after having consulted my Government, that the latter has just invited me to notify you of their accepta-^
tion of the conditions expressed in your conimunication.
Please accept, my dear Mr. Secretary, the renewed assurances of m y
high consideration.
MY
DEAR M R .
SECRETARY:
(Signed)
Hon.
ANDREW W .
MELLON,
Secretary of the Tfeas^iry,
Washington, D. C.
PAUL CLAUDEL.
SECRETARY O F T H E T R E A S U R Y
305.
Greece
EXHIBIT
22
[PUBLIC—NO. 747—70TH CONGRESS—H. R . 10760]
An Act To authorize the settlement of the indebtedness of the Hellenic Republicto the United States of America and of the differences arising out of the tripartite loan agreement of February 10, 1918
Be it enacted by the Senate and House of Representatives of the United'
States of America in Congress assembled, That the Secretary of t h e
Treasury, with the approval of the President, is hereby authorized to.
conclude an agreement for the settlement of the indebtedness of the
Hellenic Republic (hereinafter referred to as Greece) to the United
States of Araerica under the terms and conditions as set forth in
Senate Document Numbered 51, Seventieth Congress, first session.
The general terms of the agreement shall be as follows:
(1) The existing indebtedness amounting to $18,125,000 shall be
funded over a period of sixty-two years. The computation of this,
indebtedness is set forth below:
Principal amount of obligations to be funded
$15, 000, 000. 00Interest accrued and unpaid thereon to December 15, 1922, at
the rate of 4>^ per centum per annum
744, 333. 79>
Total principal and interest accrued and unpaid as of
December 15, 1922
Interest thereon at 3 per centum per annum from December
15, 1922, to January 1, 1928
-
15, 744, 333. 79.
To be paid in cash by Greece upon execution of agreement
18, 127, 922. 67^
2, 922. 67'
Total indebtedness to be funded
2, 383, 588. 88.
18, 125,000. OOv
(2) The bonds aggregating in face amount $20,330,000 (the exist-ing indebtedness, as computed above, together with the interest to.
be paid in respect thereof) shall be paid in semiannual installments,
beginning July, 1928, up to and including January 1, 1990, on a
fixed schedule, subject to the right of Greece to make such payments,,
in three-year periods, any postponed payments to bear interest at
Aji per centum per annum, payable semiannually. The amount of
the first annual installment shall be $40,000, the annual iiistallment
to increase to $350,000 in the eleventh year, which shall be the amount,
of each remaining annual installment.
(3) In addition to the payment of the bond maturing on January1 or July 1 of any year, Greece shall have the right on> such dates^
to make payments on account of any unmatured bonds: of this serieSv
under such conditions as to notice or otherwise as thie Secretary of'
the Treasury may prescribe.
(4) Any payment may be made at the option of Greece in anyUnited States Government obligations issued after April 6, 1917,..
such obligations to be taken at par and accrued interest,.
(5) To assist in the completion of the work of the Greek RefugeeSettlement Commission, the Secretary of the Treasury is furtherauthorized to advance to Greece out of the appropriation ''Purchase^
of obligations of foreign governments," established! under authority
of the Liberty Bond Acts, the sum of $12,167,000, for which Greece^
shall deliver to the Secretary of the Treasur37: it,^ t^v^eii.ty-year gold^
71799—30—FI 19 2 9
^22
;306
_
REPORT ON THE FINANCES
bonds bearing interest at the rate of 4 per centum per annum, payable semiannually, with provisions for a sinking fund sufficient to
retire such bonds within twenty years.
(6) Greece shall, in accordance with the exchange of notes, dated
January 18, 1928, between the United States and Greece and as set
forth in Senate Document Numbered 51, Seventieth Congress, first
session, furnish as securities for the loan referred to in paragraph
(5), the excess of revenues under the control of the International
Financial Commission, and shall procure the assurance of the service
of the loan by that commission.
(7) Greece shall forego all claims for further advances under the
tripartite loan agreement, dated February 10, 1918, and such agreement, so far as the United States and Greece are concerned, shall
•terminate upon the date on which the agreement authorized by this
:act becomes efl'ective.
Approved, February 14, 1929.
EXHIBIT
23
:Stateme7ii of Secretary of the Treasury Mellon concerning the settlement
of the Greek indebtedness to the United States (press release. May
10, 1929)
The Secretary of the Treasury announced that final steps were taken
-to-day for the settlement of the debt owed by Greece to the United
States and the differences existing between the two Governments
;arising out of the tripartite loan agreement of February 10, 1918.
Under the tripartite loan agreement the Secretary of the Treasury,
with the approval of President Wilson, established on the books of
the Treasury credits in favor of Greece in the aggregate amount of
f 48,236,629, for which amount the United States held the obhgations
.of Greece. Against these credits the United States made cash
^advances of $15,000,000, leaving a balance of $33,236,629, which
Grreece has.claimed the United States ow^ed it. The United States
took the position that events which transpired subsequent to 1920
relieved it from making any further advances. This difference of
-opinion has heretofore prevented the reaching of an agreement for
the settlement of the indebtedness of Greece to the United States.
At its last session the Congress authorized the Secretary of the
Treasury to make an agreement with Greece providing for the
•settlement of Greece's indebtedness to the United States and for
ladjusting outstanding differences as to the tripartite loan agreement.
This authorization provided that Greece should fund its outstanding
.obligations to the United States over a period of years and that the
United States should make an additional loan to Greece in an amount
which would make the total of the sums, advanced equal to the sums
advanced by Great Britain under the terms of the tripartite loan
agreement to which the United States, Great Britain, and France
were parties.
The terms of the agreement signed to-day on behalf of Greece by
(Charalambos Simopoulos, envoy extraordinary and minister plen•ipo ten tiary of Greece, and on behalf of the United States by the
SECRETARY OF THE TREASURY
307
Secretary of the Treasury and approved by President Hoover, include
the following:
1. The amount owed by Greece to the United States as a result of
the cash advances of $15,000,000 is to be refunded over a period, of
62 years. There are listed below the payments to be made by the
Greek Government to the United States under this settlement:
July 1, 1928
$20, 000
January 1, 1929
20, 000
July 1. 1929
^
25,000
January 1, 1930
25, 000
July 1, 1930
30, 000
January 1, 1931
30,000
July 1, 1931
110,000
January 1, 1932
110, 000
July 1, 1932
130,000
January 1, 1933
130, 000
July 1, 1933, and semiannually thereafter to January 1, 1938, 10 payments each of
150, 000
July 1, 1938, and semiannually thereafter tp January 1, 1990, 104 payments each of
I
175, 000
2. Greece is to forego all claims for further advances under the
tripartite loan agreement of February 10, 1918, which agreement, so
far as the United vStates and Greece are concerned, is to be regarded
as terminated.
3. The United States wiU advance to Greece $12,167,000 at 4 per
cent per annum with provisions for a sinking fund to retire the loan
in 20 years. The service of this loan is to be administered by the
International Financial Commission.
4. This new loan by the United States to Greece is to be turned
over in its entirety to the Refugee Settlement Commission. The
fundamental articles under which this commission functions provide
that its chairman shall always be an American. This new loan by the
United States will enable the commission to continue its great humanitarian work of establishing in economically productive work in Greece
approximately one million and a half Greek refugees driven from Asia
Minor.
In addition to the signing of the agreement, the Secretary of the
Treasury delivered to the Greek minister canceled bonds of the Greek
Government in the amount of $48,236,629.05 which had been delivered
to the United States under the tripartite loan agreement of February
10, 1918, and the Greek minister delivered to the Secretary of the
Treasury 124 bonds of the Greek Government in the aggregate amount
of $20,330,000, dated January 1, 1928, and maturing semiannually
over a period of 62 years, together with 40 bonds of the Greek Government in the aggregate amount of $12,167,000, dated May 10, 1929,
and maturing semiannually during the next 20 years and bearing
interest at the rate of 4 per cent per annum to May 10, 1949. In
addition, the Greek Government paid in cash to the United States
the sum of $2,922.67 in order that the amount to be refunded should
be an even number of dollars, together with $20,000 in payment of the
bond issued under the agreement and maturing July 1, 1928, and an
additional $20,000 in payment of the bond maturing under the agreement January 1, 1929. The Secretary of the Treasury delivered to
the Greek minister a check on the Treasurer of the United States for
$12,167,000.
•308
REPORT ON THE FINANCES
The conclusion of this agreement was authorized on the part of the
United States by the act of Congress approved February 14, 1929, and
on the part of Greece by the law of January 27, 1928.
Of the debts owed the United States by foreign governments settlements remain to be concluded with Armenia, Austria, and Russia.
Congress has already authorized the settlement of the Austrian debt.
'
EXHIBIT
24
Agreement for the funding of the Greek indebtedness to the United States
Agreement made the tenth day of May, 1929, at the city of Washington, District of Columbia, between the Government of the
Hellenic Republic, hereinafter called Greece, party of the first
part, and the Government of the United States of America, hereinafter called the United States, party of the second part
Whereas Greece is indebted to the United States as of January 1,
1928, in the principal amount of $15,000,000 (together with interest
accrued and unpiaid thereon), for cash advanced against obligations
in the aggregate principal amount of $48,236,629.05, delivered to the
United States under the tripartite loan agreement of February 10,
1918; and
Whereas Greece and the United States desire to settle the financial
differences between the two governments arising out of the said
tripartite loan agreement of February 10, 1918, and to fund the
indebtedness due as of January 1, 1928, from Greece to the United
States;
Now, therefore, in consideration of the premises and the mutual
covenants herein contained, it is agreed as follows:
PART I.
INDEBTEDNESS TO BE FUNDED
1. Amount of indebtedness.—The amount of the indebtedness to
be funded, after allowing for cash payments made or to be made by
Greece, is $18,125,000, which has been computed as follows:
Principal amount of obligations to be funded,
$15, 000, 000. 00
Interest accrued and unpaid thereon to December 15, 1922, at
the rate of 4>{ per cent per annum
744, 333. 79
Total principal and interest accrued and unpaid as of
December 15 1922
Interest thereon at 3 per cent per annum from December 15,
1922, to January 1, 1928
15, 744, 333. 79
To be paid in cash b}^ Greece upon execution of agreement
18,127,922.67
2, 922. 67
Total indebtedness to be funded into bonds
2, 383, 588. 88
18, 125, 000. 00
2. Repayment.—In order to provide for the repa3^ment of the
indebtedness thus to be funded, Greece shall issue to the United
States at par, as of January 1, 1928, bonds of Greece in the aggregate
principal amount of $20,330,000 dated January 1, 1928, and maturing on July 1, 1928, and on each January 1 and July 1 in the sue-
SECRETARY OF THE TREASURY
309
ceeding 3^ears in the amounts and on the several dates fixed in the
following schedule:
Januarv 1:
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943__..
1944
1945
1946
._- __
1947
1948
._._._
1949
1950___
1951--_
1952
1953
1954
.
1955
-___._
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
___.
1966
1967
1968
1969
1970
-1971__.
" 1972
1973
1974
1975
1976
1977
1978-.
1979
1980
1981
1982.
.
1983
1984
1985
1986
1987
1988
_1989
-_--.
1990
$20,000
25,000
30,000
110,000
130,000
150,000
150,000
150,000
150,000
150,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175, 000
175,000
175,000
175, 000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
175,000
July 1:
1928
___1929
1930
1931
1932
1933
1934
1935
1936_.
1937__ _- -1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952 .
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
•
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985_.
1986-- -- --.
1987
1988
1989
......
$20,000.
25 000
30 000
110 000
130 000
150 000
150 000
150 000
150 000
150 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 OQO
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
175 000
20, 330 000
310
REPORT ON THE FINANCES
PROVIDED, HOWEVER, That Greece, at its option, upon not less
than ninety days' advance notice in writing to the United States may
postpone any payment on account of principal falling due as hereinabove provided, to any subsequent January 1 or July 1 not more than
two and one-half years distant from its due date, but only on condition that in case Greece shall at any time exercise this option as to
any payment of principal, the two payments falling due in the next
succeeding twelve months can not be postponed to any date more
than two years distant from the date when the first payment therein
becomes due unless and until the payments previously postponed
shall actually haye been made, and the two payments falling due in
the second succeeding twelve months can not be postponed to any
date more than one year distant from the date when the first paj^ment therein becomes due unless and until the payments previously
postponed shall actually have been made, and further payments can
not be postponed at all unless and until all payments of principal
previously postponed shall actually have been made. All such
postponed payments of principal shall bear interest at the rate of
4% per cent per annum, payable semiannually.
3. Form of bonds.-—All bonds issued or to be issued under Part I
hereof to the United States shall be payable to the Government of
the United States of America, or order, and shall be signed for Greece
by its envoy extraordinary and minister plenipotentiary at Washington, or by its other duly authorized representative. The bonds shall
be substantially in the form set forth in ^'Exhibit A ' ' hereto annexed,
and shall be issued in 124 pieces with maturities and denominations
as hereinabove set forth and shall bear no interest, unless payment
thereof is postponed pursuant to the proviso under paragraph 2 above.
. 4. Method of payment.—All bonds issued or to be issued under
Part I hereof shall be payable, as to both principal and interest, in
United States gold coin of the present standard of value, or, at the
option of Greece, upon not less than thirt}^- days' advance notice in
writing to the United States, in any obligations of the United States
issued after April 6, 1917, to be taken at par and accrued interest to
the date of payment hereunder.
All payments, whether in cash or in obligations of the United
States, to be made by Greece on account of the principal of or interest
on any bonds issued or to be issued under Part I hereof and held, by
the United States, shall be made at the Treasury of the United
States in Washington, or, at the option of the Secretary of the Treasury of the United States, at the Federal Reserve Bank of New York,
and if in cash shaU be made in funds immediately available on the
date when payment is due, or if in obligations of the United States
shall be in form acceptable to the Secretary of the Treasury of the
United States under the general regulations of the Treasury Department governing transactions in United States obligations.
5. Paijments before maturity.—Greece, at its option, on January 1
or July 1 of any year, upon not less than ninety days' advance notice
in writing to the United States, may make advance payments in
amounts of $1,000 or multiples thereof, on account of the principal
of any bonds issued or to be issued under Part I hereof and held by
the United States. Any such advance payments shall be applied to
the principal of such bonds as may be indicated by Greece at the
time of the payment.
SECRETARY OF THE TREASURY
311
6. Exchange for marketable obligations.—Greece shall issue to the
United States at any time, or from time to time, at the request of
the Secretary of the Treasury of the United States, in exchange for
any or all of the bonds issued under Part I hereof and held by the^
United States, definitive engraved bonds in form suitable for sale~
to the public, in such amounts and denominations as the Secretary of
the Treasury of the United States may request, in bearer form, witk
provision for registration as to principal, and/or in fully registered
form, and otherwise on the same terms and conditions, as to dates
of issue and maturity, rate or rates of interest, if any, exemption from
taxation, payment in obligations of the United States issued after
April 6, 1917, and the like, as the bonds surrendered on such exchange.
Greece shaU deliver definitive engraved bonds to the United Statesin accordance herewith within six months of receiving notice of any
such request from the Secretary of the Treasury of the United States,
and pending the delivery of the definitive engraved bonds shaU deliver, at the request of the Secretary of the Treasury of the United
States, temporary bonds or interim receipts in form satisfactory tothe Secretary of the Treasury of the United States within thirty
days of the receipt of such request, all without expense to the United
States. The United States, before offering any such bonds or interim^
receipts for sale in Greece, shall first offer them to Greece for purchaseat par and accrued interest, if any, and Greece shall hkewise have
the option, in lieu of issuing any such bonds or interim receipts, to^
make advance redemption, at par and accrued interest, if any, of a
corresponding principal amount of bonds issued hereunder and held
by the United States. Greece agrees that the definitive engraved
bonds caUed for by this paragraph shall contain all such provisions,,
and that it shall cause to be promulgated all such rules, regulations,^
and orders as shall be deemed necessary or desirable by the Secretary
of the Treasury of the United States in order to facilitate the sale of
tl;ie bonds in the United States, in Greece, or elsewhere, and that if
requested by the Secretary of the Treasury of the United States, it
will use its good offices to secure the listing of the bonds on sucb
stock exchanges as the Secretary of the Treasury of the United
States may designate.
7. Cancellation and surrender of obligations.—Upon the execution
of this agreement, the delivery to the United States of the $20,330,000*
principal amount of bonds of Greece to be issued under Part I hereof,,
together with satisfactory evidence of authority for the execution
of this agreement by the representative of Greece and for the execu-tion of the bonds to be issued under Part I hereof, the United Stateswill cancel and surrender to Greece at the Treasury of the United
States in Washington the obligations of Greece held by the United
States in the aggregate principal amount of $48,236,6.29.05, referred
to in the preamble to this agreement.
PART II.
NEW LOAN
1. Amount.—The United States shaU loan to Greece the sum of
$12,167,000 for which Greece shall deliver to the United States its^
20-year gold bonds bearing interest at the rate of 4 per cent per
annum, payable semiannually. The amount so loaned shall beturned over in its entirety by Greece to the Refugee Settlement
-312
REPORT ON THE FINANCES
Commission, to be expended by said commission for the purpose of
carrying out its settlement work. Greece agrees to request the
chairman of the Refugee Settlement Commission to furnish annually
to the Secretary of the Treasury of the United States a detailed
statement showing the expenditures made on account of the settlement work from the proceeds of the new loan.
Greece undertakes to limit the total amount borrowed or to be
borrowed under the terms of the Greek stabUization and refugee
loan protocol signed at Geneva, September 15, 1927, to an amount
which when added to this new loan from the United States in the
-amount of $12,167,000 wiU yield an eft'ective sum equivalent to not
more than £9,000,000 sterling.
2. Security.—The new loan provided for in this agreement shall
rank with and shall share the same securities and all other advantages
as the Greek stabilization and refugee loan of 1928 provided for in
"the international loan agreement executed January 30, 1928, between
representatives of Greece and Speyer and Compan}^, the National
'City Company and the National City Bank of New York, and in the
international loan agreement executed January 30, 1928, between
-representatives of Greece and Hambros Bank Limited and Erlangers,
which agreements were concluded in pursuance of and under the
authority of the Greek stabilization and refugee loan protocol signed
at Geneva on behalf of Greece by the Greek Minister of Finance on
'September 15, 1927, and approved by the Council of the League of
Nations by resolution of the same date and ratified by the decree
law of Greece of November 10, 1927, and signed by the President of
Greece and ratified by the Greek Parliament and published in the
Greek Ofl&cial Gazette of December 7, 1927.
The service of this new loan by the United States is secured (together with the service of the aforesaid Greek stabilization and
refugee loan of 1928) by a first charge on the revenues under the
control of the International Financial Commission on September
15, 1927, as indicated in Annex II, Table *'A," to the aforesaid
Greek stabilization and refugee loan protocol signed at Geneva,
September 15, 1927, in so far as the yield of these revenues is not
required for the service of the loans having a prior charge upon the
said revenues at the said'date, all of which said loans are specified
in Annex I I to the aforesaid Greek stabilization and refugee loan
protocol and in the first schedules attached to the aforesaid international loan agreements and in '* Exhibit C " hereto annexed, and Greece
acknowledges that such revenues stand charged accordingly.
Greece has given its irrevocable mandate to the International
Financial Commission and has taken all other necessary and proper
steps to assign and charge as security for the service of this new
loan by the United States all the above-mentioned revenues, and the
International Financial Commission has irrevocably undertaken to
deal with such revenues and all other revenues, if any, which may at
any time be pledged as security for this new loan by the United
•States.
Subject to the obligations resulting from prior charges thereon,
the above-mentioned revenues shall be held and apphed by the
International Financial Commission for the purpose of making up
any past defaults should they have occurred as well as for the purpose
of meeting the periodical service of this new loan by the United States.
SECRETARY OF THE TREASURY
313^
In the event of there occurring in any year a default in the payment of the service of this new loan by the United States, the ratio
in which it is to share the same securities as the Greek stabilization'
and refugee loan of 1928 provided for in the international loanagreements dated January 30, 1928, shall be the same as that which'
the amount of the annual service charge due the United States
bears to the amount of the anniial service charge due the holdersof the bonds issued in accordance with the above-mentioned international loan agreements of January 30, 1928.
3. Repayment.—In order to provide for the repayment of the loan*
thus to be made by the United States, Greece shall issue to the
United States at par, as of May 10, 1929, bonds in the aggregateprincipal amount of $12,167,000, dated May 10, 1929, and maturing
serially on November 10, 1929, and on each May 10 and November
10 in the succeeding years in the amounts and on the several datesfixed in the following schedule:
May 10:
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946-_
1947
1948
1949
$206,000
214, 000
222, 000
231,000
240, 000
251, 000
261, 000
271, 000
_-_- 282, 000
293, 000
305, 000
318, 000
330, 000
.___ 344, 000
358, 000
372, 000
387, 000
403, 000
419, 000
436, 000
November 10:
1929
1930
1931
1932
1933--_1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
$201, 000^
210,
218, 000'
227, 000^
236, 000
245, 000
256, 000^
266, 000
276, 000
288, ooo300,
312, 000
324, 000
337, 000
350, 000
365, 000
380, 000
395, 000
411, 000'
427, 000'
ooa
ooo
12, 167,000'
4. Form of bond.—All bonds issued or to be issued under Part I I
hereof to the United States shall be payable to the Government of
the United States of America or order, and shall be signed for Greeceby its envoy extraordinary and minister plenipotentiary at Washington, or by its other duly authorized representative. The bonds shall
be substantially in the form set forth in ^'Exhibit B , " hereto annexed,,
and shall be issued in 40 pieces with maturities and in denominationsas hereinabove set forth, and shall bear interest at the rate of 4 p e r
cent per annum, payable semiannually.
5. Method of payment.—All bonds issued or to be issued under PartI I hereof shall be payable as to both principal and interest in United
States gold coin of the present standard of value. All payments tO'
be made by Greece on account of the principal of or interest on any
bonds issued or to be issued under Part I I hereof and held by the^
United States, shall be made on behalf of Greece by the International
Financial Commission at the Treasury of the United States in Washington, or, at the option of the Secretary of the Treasury of the United
States, at the Federal Reserve Bank of New York, and shall be made
in funds immediately available on the date when payment is due.
S14
' REPORT ON THE FINANCES
6. Payment before maturity.—On the tenth day of November, 1929,
'or any interest payment date thereafter, Greece, upon not less than
ninety days' advance notice in writing to the United States, may
make advance payments in amounts of $1,000 or multiples thereof,
'On account of the principal of any bonds issued or to be issued under
Part I I hereof and held by the United States. Any such advance
payments shall be applied to the principal of such bonds as may be
indicated by Greece at the time of payment.
7. Exchange for marketable obligations.—Greece will issue to the
United States at any time, or from time to time, at the request of the
Secretary of the Treasury of the United States, in exchange for any
•or all of the bonds issued hereunder and held by the United States,
definitive engraved bonds in form suitable for sale to the public, in
such amounts and denominations as the Secretary of the Treasury
•of the United States may request, in bearer form, with provision for
registration as to principal, and/or in fully registered form, and otherwise on the same terms and conditions as to dates of issue and maturity, rate or rates of interest, if any, excemption from taxation, and
the like, as the bonds surrendered on such exchange. Greece will
•deliver definitive engraved bonds to the Urited States in accordance
..herewith within six months of receiving notice of any such request
from the Secretary of the Treasury of-the United States, and pending
the delivery of the definitive engraved bonds will deliver, at the request
-of the Secretary of the Treasury of the United States, temporary
bonds or interim receipts in form satisfactory to the Secretary of the
Treasury of the United States within thirty days of the receipt of
such request, all without expense to the'United States. The United
States, before offering an}^ such bonds or interim receipts for sale in
Greece, shall first offer them to Greece for purchase at par and accrued
interest, if any, and Greece shall likewise have the option, in lieu of
issuing any such bonds or interim receipts, to make advance redemption, at par and accrued interest, if any, of a corresponding principal
amount of bonds issued hereunder and held by the United States.
•Greece agrees that the definitive engraved bonds called for b}^ this
paragraph shall contain all such provisions, and that it shall cause
to be promulgated all such rules, regulations, and orders as shall be
•deemed necessary or desirable by the Secretary of the Treasury of
the United States in order to facilitate the sale of the bonds in the
United States, in Greece, or elsewhere, and that if requested by the
Secretary of the Treasury of the United States, it will use its good
•ofiices to secure the listing ;0f the bonds on such stock exchanges as
the Secretary of the Treasury^of the United States may specify.
PART. H I .
GENERAL
1. Exemption from taxation.—The piincipal and interest of all
bonds issued or to be issued under Parts I and I I hereof shaU be
paid without deduction for, and shall be exempt from, any and all
taxes or other public dues, present or future, imposed by or under
authority of Greece or any pohtical or local taxing authority within
the Hellenic Republic, whenever, so long as, and to the extent that
beneficial ownership is in (a) the Government of the United States,
{&) a person, firm, or association neither domiciled nor ordinarily
resident in Greece, or (c) a corporation not organized under the laws
of Greece.
SECRETARY OF THE TREASURY
315
2. Notices.—Any notice, request, or consent under the hand of the
Secretary of the Treasury of the United States, shall be deemed and
taken as the notice, request, or consent of the United States, and
shall be sufficient if delivered at the Legation of Greece at Washington or at the office of the Ministry of Finance in Greece; and any
notice, request, or election from or by Greece shall be sufficient if
delivered to the American legation at Athens or to the Secretary of
the Treasury at the Treasury of the United States in Washington.
The United States in its discretion may waive any notice required
hereunder, but any such waiver shall be in writing and shall not
extend to or affect any subsequent notice or impair an}^ right of the
United States to require notice hereunder.
3. Compliance with legal reguirements.—Greece represents and
agrees that the execution and delivery of this agreement have in all
respects been, duly authorized, and that all acts, conditions, and legal
formalities which should have been completed prior to the making
of this agreement have been completed as required by the laws of
Greece and in conformity therewith.
4. Termination of tripartite loan agreement.—Greece shall forego all
claims for further advances under the tripartite loan agreement of
February 10, 1918, which agreement, so far as the United States and
Greece are concerned, shall be regarded as terminated.
5. Counterparts.—This agreement shall be executed in two counterparts, each of which shall have the force and effect of an original.
In witness whereof, Greece has caused this agreement to be executed on its behalf by Charalambos Simopoulos, its envoy extraordinary and minister plenipotentiary at Washington, thereunto
duly authorized, and the United States has likewise caused this
agreement to be executed on its behalf by the Secretary of the Treasury, with the approval of the President, pursuant to the act of
Congress approved February 14, 1929, all on the day and year first
above written.
By
T H E H E L L E N I C REPUBLIC,
CHARALAMBOS SIMOPOULOS,
Envoy Extraordinary and Minister Plenipotentiary.
By
T H E U N I T E D STATES OF AMERICA,
ANDREW W . M E L L O N ,
Secretary of tlie Treasury.
Approved.
H E R B E R T HOOVER,
President.
EXHIBIT A
(Form of bond)
T H E HELLENIC REPUBLIC
No.
The Hellenic Repubhc, hereinafter caUed Greece, for value received,
hereby promises to pay to the Government of the United States of
America, hereinafter called the United States, or order, on
,
the sum of
dollars ($
). This bond is payable in gold
coin of the United States of America of the present standard of
value, or, at the option of Greece, upon not less than thirty days'
316
'
REPORT ON T H E FINANCES
advance notice in writing to the United States, in any obligations of
the United States issued after April 6, 1917, to be taken at par and
accruod interest to the date of payment hereunder.
^
This bond is payable without deduction for, and is exempt from,
any and all taxes and other public dues, present or future, imposed
by or under authority of Greece or any political or local taxing
authority within Greece, whenever, so long as, and to the extent
that, beneficial ownership is in (a) the Government of the United
States, (6) a person, firm, or association neither domiciled nor ordinarily resident in Greece, or (c) a corporation not organized under the
laws of Greece. This bond is payable at the Treasury of the United
States in Washington, D . C , or at the option of the Secretary of the
Treasury of the United States at the Federal Reserve Bank of New
York.
This bond is issued pursuant to the provisions of paragraph 2,
Part I of an agreement dated May 10, 1929, between Greece and
the United States, to which agreement this bond is subject and towhich reference is hereby made.
In witness whereof, Greece has caused this bond to be executed on
its behalf and delivered at the city of Washington, District of
Columbia, by its envoy extraordinary and minister plenipotentiary
at Washington, thereunto duly authorized, as of May 10, 1929.
T H E HELLENIC REPUBLIC,
^y
r
>
Envoy Extraordinary and Minister Plenipotentiary.
EXHIBIT
B
(Form of bond)
T H E HELLENIC REPUBLIC
No.
The Hellenic Republic, hereinafter called Greece, for value received^
hereby promises to pay to the Government of the United States of
America, hereinafter called the United States, or order, on
, the
sum of
dollars ($
), and to pay interest upon said
principal sum from May 10, 1929, at the rate of 4 per cent per annum,
payable semiannually on the tenth day of M a y and November in
each year, until the principal hereof has been paid. This bond is
payable as to both principal and interest in gold coin of the United
States of America of the present standard of value.
This bond is payable as to both principal and interest without
deduction for, and is exempt from, any and all taxes and other public
dues, present or future, imposed by or under authority of Greece or
any political or local taxing authority within the Hellenic Republic,
whenever, so long as, and to the extent that, beneficial ownership
is in (a) the Government of the United States, (&) a person, firm, or
association neither domiciled nor ordinarily resident in Greece, or
(c) a corporation not organized under the laws of Greece. This bond
is payable as to both principal and interest at the Treasury of the
United States in Washington, D. C , or at the option of the Secretary
of the Treasury of the United States at the Federal Reserve Bank of
New York.
SECRETARY OF T H E
317
TBEASURY
This bond is issued pursuant to the provisions of paragraph 3 of
P a r t l i of an agreement dated May 10, 1929, between Greece.and the
United States, to which agreement this bond is subject and to which
reference is hereby made.
In witness whereof, Greece has caused this bond to be executed in
its behalf at the city of Washington, District of Columbia, by its
•envoy extraordinary and minister plenipotentiary at Washington,
thereunto duly authorized, as of May 10, 1929.
T H E H E L L E N I C REPUBLIC,
By
:
> . .
.
.
Envoy Extraordinary and Minister Plenipotentiary.
EXHIBIT
C
/. Loans under the control of the International Finaiicial Commission.
Nominal
a m o u n t on
J u l y 31,1927
N a m e of loan
A n n u a l service
r £12,000 and
A. 1833. G u a r a n t e e d b y t h e three
powers
. . . g o l d f r s . . 1 41,346, Oil I F - frs. 600,000
B . Old d e b t s in gold:
£181,068.30
75, 733, 500
5% 1881
gold f r s . .
157, 695. 21
5% 1884 -„
65, 903, 500
194, 276. 01
4 % 1887 monopolies
101, 921, 000
216, 929. 03
113,395,500
4 % 1889 rente - 103, 688.18
5% 1890 Pirseus-Larissa
43, 282, 000
16,866. 96
5% 1893 funding
7,011,000
Remarks
M a x i m u m service, subject to dim i n u t i o n according to decision
which m a y be arrived at concerning t h e conversion of surplus values.
870, 523. 69
C. N e w d e b t s in gold:
2 H % 1898 ( g u a r a n t e e d ) - . . . g o l d f r s . .
4% 1902 Greek R a i l w a y
5% 1914 (500 millions)
78, 750, 000
54, 282, 000
308, 200, 000
£217,124. 28
89, 841. 95
702, 067. 87
Subject to the issue of unissued
portion 164,926,000 a n n u a l service £345,000.
1,009,034.10
D . D e b t in paper d r a c h m a s :
1885 patriotic
5% 1898 (consolidated)--.
5% 19'00 (Pyrgbs-jVieligala)
drs..
1, 266, 250
71, 570,000
10, 555, 000
E . C o m p u l s o r y issue of b a n k notes
F . Service of Salonica-Constantinople
R a i l w a y b o n d s in
. . F . frs..
G. Refugee loan 7% 1924
gold f r s . .
40, 000,000
140, 825, 000
299, 910,000
F . frs. 4,997,112
..,£750, 582. 42
$827,987. 02
H . P a r t i c i p a t i o n in T u r k i s h d e b t
I. Ulen water loan 8% 1925
gold f r s . .
40. 500, 000
1 $1,002, 500
D r s . 45,360
3,901, 981
611, 794
4, 559,135
A n n u a l service n o t yet determ i n e d ; will n o t exceed 150,000,000 d r s .
1 Maximum future annual service subject to diminution by collection of water receipts and special ta.xes
expected ultimately to cover entire service.
318
REPORT ON THE FINANCES
EXHIBIT C—Continued
2. Loans not under the control of the International Financial Commission
N a m e of loan
A . D e b t s in gold:
5% 1907 Def. N a t —
4% 1910
gold f r s . .
Nominal
a m o u n t on
J u l y 31,1927
A n n u a l service
14,416,000
95, 069, 000
£48, 347. 53
184, 474. 58
Remarks.
232, 822.11
B . D e b t s in d r a c h m a s :
6% 1917 (100 mil.)
6% 1918 (75 m i l . ) . . . .
5% 1920 (300 m i l . ) . . . .
63, 058, 700
34, 420,800
287,898,000
8, 079,910
5, 336, 651
20,426, 508
^
C. D e b t in dollars: 5 % C a n a d i a n
gold f r s . -
33,843,069
$566,875
36,900,000
EXHIBIT
25
Schedule of payments to be made by Greece on the 4 per cent loan of $12,167,000,
authorized by the act of February 14, 1929
SemiSemiTotal
Semiannual
annual
semiannual
P r i n c i p a l . principal interest
annual
periods
payments payments payments
$12,167,000 $201,000
206,000
11,966,000
210,000
11,760,000
214,000
11,550,000
218,000
11,336,000
222,000
11,118,000
227,000
10,896,000
231,000
10,669,000
236,000
10,438,000
240,000
10,202,000
245,000
9,962-000
251,000
9,717,000
256,000
9,466,000
261,000
9,210,000
8, 949, OCO 266,000
271,000
8,683,000
276,000
8,412,000
282,000
8,136,000
2S8,000
7,854,000
293,000
7,566,000
300,000
7,273,000
$243,340
239,320
235,200
231,000
226,720
222,360
217,920
213,380
208,760
204,040
199,240
194,340
189,320
184,200
178,980
173,660
168,240
162,720
157,080
151,320
145,460
$444,340
445,320
445,200
445,000
444,720
444,360
444,920
444,380
444,760
444,040
444,240
445,340
445,320
445,200
444,980
444,660
444,240
444,720
445,080
444,320
445,460
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Principal
$6,973,000
6,668,000
6,356,000
6,038,000.
5,714,000
5,384,000
5,047,000
4,703,000
4,353,000
3,995,000
3,630,000
.3,258,000
2,878,000
2,491,000
2,096,000
1,693,000
1.282,000
: 863,000
436,000
SemiSemiTotal
Semiannual
annual
semiannual
.principal interest
annual
periods
payments payments payments
$305,000
312,000
318,000
324,000
330,000
337,000
344,000
350,000
358,000
365,000
372.000
380,000
387,000
395,000
403,000
411,000
419,000
427,000
436,000
$139,460
133,360
127,120
120,760
114,280
107,680
100,940
94,060
87, 060
79,900
72,600
65,160
57,560
49,820
41,920
33,860
25,640
17,260
8,720
$444,460
445,360
445,120
444,760
444,280
444,680
444,940
444,060
445,060
444,900
444,600
445,160
444,560
444,820
444,920
444,860
444,640
444,260
444,720
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
12,167,000 5,623,760 17,790,760
Kingdom of the Serbs, Croats, and Slovenes
E X H I B I T 26
Final exchange of obligations under funding agreement (press release,
December 1, 1928)
The Secretary of the Treasury announced:
Final steps were taken to-day in connection with the funding of
the indebtedness of the Kingdom of the Serbs, Croats, and Slovenes
to the United States.
Mr. Bojidar Pouritch, counselor of the legation of the Serbs,
Croats, and Slovenes and charg^ d'affaires ad interim at Washington,
delivered to the Treasury 62 gold bonds of his Goyernment in the
SECRETARY OF TPIE TREASURY
319
principal amount of $62,850,000, receiving in exchange original
obligations given by his Government in connection with cash advances
and surplus war materials sold by the United States Liquidation
Commission (War Department).
The act approving the debt settlement of the Government of the
Kingdom of the Serbs, Croats, and Slovenes was signed by the
President on March 30, 1928. The settlement has hkewise been
approved by the Government of the Kingdom of the Serbs, Croats,,
and Slovenes.
General
E X H I B I T 27
Statements of the Treasury covering payments received from the several'
foreign governments on account of their indebtedness to the United
States (p)ress releases, December 15, 1928, and June 15, 1929)
DECEMBER 15,
1928.
The Treasury to-day received payments amounting to $98,612,203.02, from the following foreign governments on account of their
funded indebtedness to the United States:
GREAT BRITAIN
The twelfth semiannual payment of interest and the sixth annual
installment of principal on the funded indebtedness of Great Britain
to the United States under the terms of the debt settlement approved
by the act of February 28, 1923. The total payment amounted to*
$94,200,000, of which $67,200,000 was for interest and $27,000,000'
for principal, and as authorized by the terms of the settlement, was
made in obligations of the United States which were accepted at par
and accrued interest. The obligations were $90,540,000 face amount
3K per cent Treasury notes. Series C-1930-32, maturing December 15,.
1932; $3,628,050 face amount 3)^ per cent Treasury notes. Series
B-1930-32, maturing September 15, 1932; accrued interest thereon,.
$31,920.83, and cash adjustment of $29.17.
BELGIUM
The seventh semiannual payment of interest on the post-armistice
funded indebtedness of the Government of Belgium due the United
States under the terms of the debt settlement approved by the act
of April 30, 1926. The payment amounting to $1,250,000, as
authorized by the terms of the settlement, was made in obligations of
the United States, which were accepted at par and accrued interest.
The obligations were $1,000,000 face amount of 3K per cent Treasury
notes. Series A-1930-32, maturing March 15, 1932; $239,000 face
amount Z)i per cent Treasury notes. Series B-1930-32, maturing
September 15, 1932; accrued interest thereon, $10,90:1.14; and cash
adjustment of $98.86.
,
CZECHOSLOVAKIA
The seventh semiannual installment of principal on the funded
indebtedness of the Government of Czechoslovakia due the United
States under the terms of the debt settlement approved by the act
320
BEPOET ON T H E FINANCES
of May :3, 1926. The payment amounting to $1,500,000, as authorized by the terms of the settlement, was made in obligations of the
United States, which were accepted at par and accrued interest.
T h e obligations were $1,486,500 face amount 3^ per cent Treasury
notes.. Series B-1930-32, maturing September 15, 1932; accrued
interest thereon, $13,078.74, and cash adjustment of $421.26.
ESTONIA
The sixth semiannual payment on account of the funded indebtedness of the Government of Estonia to the United States due under
the terms of the debt settlement approved by the act of April 30,
1926. The payment amounted to $100,000, which was made in cash.
The balance will be funded in accordance with the option given the
Government of Estonia in the debt-settlement agreement.
FINLAND
The twelfth semiannual payment of interest and the sixth annual
installment of principal on the funded indebtedness of the Government of Finland due the United States under the terms of the debt
settlement approved by the act of March 12, 1924. The total payment .amounted to $183,460, of which $131,460 was for interest and
$52,000 for principal, and, as authorized by the terms of the settlement, was made in obligations of the United States, which were
accepted at par and accrued interest. The obligations were $181,800
face amount 3 ^ per cent Treasury notes, Series B-1930-32, maturing
Septeniber 15, 1932; accrued interest thereon of $1,599.54, and cash
.adjustment of $60.46.
HUNGARY
The tenth semiannual payment of interest and the fifth annual installment of principal on the funded indebtedness of the Government
of Hungary due the United States under the terms of the debt settlement approved by the act of May 23, 1924. The total payment
amouiited to, $39,773,01, of which $29,133.01 was for interest and
$10,640 was for principal. The payment was mad^ in cash.
LATVIA
The sixth semiannual payment on account of the funded indebtedness of the Government of Latvia to the United States due under the
terms of the debt settlement approved by the act of April 30, 1926.
The payment amounted to $40,000, which was made in cash. The
balance will be funded in accordance with the option given the
Government of Latvia in the debt-settlement agreement.
LITHUANIA
The ninth semiannual payment of interest, except that part to be
funded, on the funded indebtedness of the Government of Lithuania
to the United States under the terms of the debt settlement approved
by the act of December 22, 1924. The total payment amounted to
$48,970.01, which w^as made in cash. The remainder of the interest,
amounting to $44,302.50, will be funded in accordance with the option
given the Government of Lithuania in the debt-settlisment agreement.
SECRETARY OF THE TREASURY
321
POLAND
The eighth semiannual payment on account of the funded indebtedness of the Government of Poland to the United States under the terms
of the debt settlement approved by the act of December 22, 1924.
The payment amounted to $1,250,000, which was made in cash. The
remainder due will be funded in accordance with the option given the
Government of Poland in the debt-settlement agreement.
The obligations of the United States in the face amount of
$97,075,350, accepted in connection with the British, Belgian,
Czechoslovak, and Finnish payments, have been canceled and retired
and the public debt reduced accordingly.
J U N E 15,
1929.
The Treasury to-day received payments amounting to $80,109,385.95 from the following foreign governments on account of their
indebtedness to the United States, of which $78,567,000 v^as in United
States 3K per cent Treasury notes, accrued interest thereon of
$683,509.76,'and $858,876.19 in cash.
GREAT BRITAIN
The thirteenth semiannual payment of interest on the funded
indebtedness of Great Britain to the United States under the terms
of the debt settlement approved by the act of February 28, 1923,
The total payment amounted to $66,795,000, and as authorized by
the terms of the settlement, was made in obligations of the United
States, which were accepted at par and accrued interest with a small
cash adjustment. The obligations were $66,215,600 face amount of
3K per cent Treasury notes. Series A-1930-32, the accrued interest
being $579,386.50 and the cash adjustment $13.50.
ITALY
The fourth annual installment of principal on the funded indebtedness
of Italy to the United States under the terms of the debt settlement
approved by the act of April 28, 1926. The total payments amounted
to $5,000,000, and, as authorized by the terms of the settlement was
made in obligations of the United States, which were accepted at par
and accrued interest. The obligations were $1,500,000, face amount
of 3K per cent Treasury notes. Series A-1930-32, $3,456,600 face
amount of 3^ per cent Treasury notes. Series B-1930-32, the accrued
interest being $43,370.25, and the cash adjustment $29.75.
BELGIUM
The eighth semiannual payment of interest and the fourth installment of principal on the funded indebtedness of the Government of
Belgium to the United States under the terms of the debt settlement
approved by the act of April 30, 1926. The total payment amounted
to $4,200,000, and, as authorized by the terms of the settlement, was
made in obligations of the United States, which were accepted at par
and accrued interest with a small cash adjustment. The obligations were $500,000 face amount of 3j^ per cent Treasury notesf
Series A-1930-32, $1,970,000 face amount of 3K per cent Treasury
71799—30—FI 19'2 9
^23
322
REPORT ON T H E FINANCES
notes. Series B-1930-32, and $1,679,000 face amount of 3K per cent
Treasury notes. Series C-1930-32, the accrued interest being $50,995
and the cash adjustment $5; $1,250,000 was for interest and
$1,200,000 for principal, on the post-armistice debt, and $1,750,000
for principal on the pre-armistice debt.
CZECHOSLOVAKIA
The eighth semiannual installment of principal on the funded
indebtedness of the Government of Czechoslovakia to the United
States under the terms of the debt settlement approved by act of
May 3, 1926. The payment amounted to $1,500,000, and, as authorized by the terms of the settlement, was made in obligations of the
Uniteci States, which were accepted at par and accrued interest with
a small cash adjustment. The obligations were $495,650 face
amount of 3K per cent Treasury notes. Series B-1930-32, $1,000,000
face amount of 3^ per cent Treasury notes, Series C-1930-32, the
accrued interest being $4,336.94 and the cash adjustment $13.06.
ESTONIA
The seventh semiannual payment on account of the funded indebtedness of the Government of Estonia to the United States under the
terms of the debt settlement approved by the act of April 30, 1926.
The payment amoimted to $125,000, and, as authorized by the terms
of the settlement, was made in obligations of the United States, which
were accepted at par and accrued interest. The obligations were
$123,900 face amount of 3% per cent Treasury notes, Series B-1930-32,
the accrued interest being $1,084.13 and the cash adjustment $15,87.
The balance will be funded in accordance with the option given the
Government of Estonia in the debt-settlement agreement.
FINLAND
The thirteenth semiannual payment of interest on the funded
indebtedness of the Government of Finland to the United States
under the terms of the debt settlement approved by the act of March
12, 1924. The total payment amounted to $130,680, and, as authorized by the terms of the settlement, was made in obligations of the
United States, which were accepted at par. The obligations were
$130,600 face ainount of 3K per cent Treasury notes, Series C-1930-32^
the cash adjustment being $80.
HUNGARY
The eleventh semiannual payment of interest on the funded indebtedness of the Government of Hungary to the United States under
the terms of the debt settlement approved by the act of May 23, 1924.
The total payment amounted to $28,973.40, which was made in cash,
LATVIA
The seventh semiannual payment on account of the funded indebtedness of the Government of Latvia to the United States under the
terms of the debt settlement approved by the act of April 30,, 1926.
SECRETARY OF THE. TREASURY
| 323
The payment amounted to $45,000, and was made in cash. I The
balance will be funded in accordance with the option given the
Government of Latvia in the debt-settlement agreement.
LITHUANIA
The tenth semiannual payment of interest, except that part to
be funded, and the fifth annual installment of principal on the funded
indebtedness of the Government of Lithuania to the United States
under the terms of the debt settlement approved by the act of December 22, 1924. The total payment amounted to $84,732.55, of jvhich
$49,634.55 was for interest and $35,098 for principal. The payment
was made in cash. The balance of the interest, amounting to $44,302.50, will be funded in accordance with the option given the Go'vernment of Lithuania in the debt-settlment agreement.
POLAND
The ninth semiannual payment on account of the funded indebtedness of the Government of Poland to the United States under the
terms of the debt settlement approved by the act of December 22,,
1924. The payment amounted to $1,500,000, and, as authorized by
the terms of the settlement, w^as made in obligations of the United.
States, w^hich were accepted at par and accrued interest. The obligations were $495,650 face amount of 3K per cent Treasury motes.
Series B-1930-32; $1,000,000 face amount of 3K per cent Treasury
notes. Series C-1930-32, the accrued interest being $4,336.94; and the
cash adjustment $13.06. The balance due will be funded in accordance with the option given the Government of Poland in the| debt
settlement agreement.
RUMANIA
'
•
.
.
. !,
The fourth annual installnient of principal on the funded indepted-^
ness of the Government of Rumania to the United States under the
terms of the debt settlement approved by the act of May 3, |l926.
The payment, amounting to $500,000, was made in cash.
YUGOSLAVIA
The fourth annual installment of principal on the funded
ness of the Government of Yugoslavia (Serbs, Croats, and
to the United States under the terms of the debt settlement
by the act of March 30, 1928. The payment, amounting to
was made in cash.
indebtedSlovenes)
approved
$200,000,,
The obligations of the United States accepted in connection with
the payments have been canceled and retired and the public d3bt>
reduced accordingly.
324
REPORT ON THE FINANCES
Small-size currency
E X H I B I T 28
• Identical letters, dated January 21, 1929, from Secretary of the Treasury
Mellon to the President of the Senate and the Speaker of the House of
Representatives relative to the issue of small-size national-bank notes
(jpress release, January 22, 1929)
WASHINGTON, J a n u a r y 21, 1929.
Mr. PRESIDENT ( S P E A K E R ) : In my annual report for
the fiscal year 1928, submitted to the Congress last December, referring to the question of whether the national-bank notes now in circulation should be retired, I said as follows:
M Y DEAR
^*In all probability a conclusion as to the possible retirement of the nationalbank circulation, through exercise of the call privilege attaching to the 2 per cent
consols which arises after April 1, 1930, will be reached before the department can
issue national-bank notes in the reduced size. The Federal reserve act originally
contemplated the retirement of the national-bank currency. The problem was
discussed fully in the annual report for 1924. Considerable time having elapsed,
it is felt advisable to submit the matter to the Congress for decision at the present
session. In the event national-bank notes are continued indefinitel}^ as a part
of the money circulation of the United States, the Treasury will be prepared to
apph'' the new designs to such notes and to make them available in the reduced
size within a reasonable time after the issue of other kinds of currency in the
reduced size."
The question has received the thorough study and consideration of
this department, and I have concluded that it would be inadvisable
to submit to Congress at this time a program looking to early retirement of our national-bank note circulation. Accordingly, when the
new-size paper currency is issued, on or about July 1, 1929, the
Treasury Department will be prepared shortly thereafter to make
afvailable national-bank notes in the reduced size.
Sincerely yours,
A. W.
MELLON,
Secretary of the Treasury.
E X H I B I T 29
^^The New Currency Issue,^' an address by Assistant Secretary of the
Treasury Bond, May 17, 1929, before the Missouri Bankers Association, Excelsior Springs, Mo.
The privilege of meeting with you at this convention of the Missouri
Bankers Association is one that I assure you I deeply appreciate, as it
gives me the opportunity of presenting to you some of the principal
problems connected with the issue of the reduced-size currency. I
appreciate that with many of these problems you are, by reason of
your long experience as bankers, more familiar than I can pretend to
have become in my limited connection with the Treasury Department.
However, it is my hope that by presenting these problems from the
viewpoint of that department you will perhaps see them from a
somewhat different angle, and by showing you the difl&culties that
we have already faced and overcome, and the remaining difficulties
that still confront us, we may have your full cooperation in the
transitional period which we are now rapidly^approaching.
SECRETARY OF T H E TREASURY
325
The initial problem was that of design. For many years the matter
of revising the designs of the outstanding currency issues of the
United States had been before the department, but circumstances
seemed always to preclude any general revision and the correction of
the existing confusion. Generally speaking, there was a different
design for the face and back of each denomination of each kind. The
multiplicity and duplication of characteristic features were indescribable. For example, I have discovered eight or nine different
portraits on the $5 bills of dift'erent types or issues, and certainly as
many portraits on currency of the $10 denomination. Of course, I
do not mean to say that all these were found on the current issues, b u t
the current issues were sufficiently confusing. You will appreciate
how this situation favored counterfeiters and handicapped the
Secret Service.
The conclusion to reduce the size of the bills made it necessary to
execute wholly new engraved stock for printing the new currency,
and this gave the first really favorable opportunitj^ ever presented
for the department to make a complete revision of designs. Many
months were devoted to the study, and finally certain principles
were arrived at and adopted, with the result that the new designs
are on a denominational basis, with emphasis on the dollar value
rather than kind, and with the outstanding features inherently affording greater security. An effort has' been made to keep the designs
as simple as possible without unnecessary and confusing ornamentation. For the new designs every back of a given denomination will
be absolutel}'' identical. For example, take a $5 bill. The back will
always bear an engraving of the Lincoln Memorial as a predominating
feature. The $5 backs will accordingly be printed in quantity and
used for any kind of currency issued in this denomination. Accordingly there will be only one $5 back, instead of several, for the Government to print and protect and for the public to become familiar with.
For the faces, although necessary to show the kind of currency, uniform denominational characteristics have been fixed, the outstanding
feature of each denomination being a portrait. Again taking our $5
bill, on the face side the portrait of Lincoln will always appear in the
center. As this feature is so prominent it will take a somewhat
careful examination to distinguish between the different types until
one is initiated into the points of difference. There are different
titles and variations in texts, and, as a further mark of diff'erence to
catch the eye, the Treasur}^ seals and serial numbers will be printed
in color, on United States notes in red, in blue for silver certificates,
in yellow for gold certificates, in green for Federal reserve notes, and
in brown for national-bank notes.
On United States currency the seal will be on the left, balancing
a large ''F-I-V-E'' at the right of the portrait. On the Federal
reserve currency the seal will be superimposed on this word '^F-I-V-E '^
at the right of the portrait, but will be balanced by the Federal
reserve district numeral at the left. The seal will have the same place
at the right on the national-bank currency, and at the left of the portrait the name of the issuing bank will be prominently printed.
These differences of color and the position of the seal^ are, we are
confident, amply sufl^icient to facilitate the ready sorting of currency
by banking institutions. Gold certificates will no longer have the
yellow back of the past, but will be printed with a green back like
326
REPORT ON T H E FINANCES
other currency and will have the numbers and seal in yellow on the
face. You will see, therefore, that we have succeeded in accomplishing a great simplification of currency designs, and we are confident
that both by design and general plan we have made counterfeiting
and the raising of the bills from one denomination to another more
dhficult in the future. The denomination henceforth can always be
told readily by the portrait, which is the most difficult thing to counterfeit successfully, and if the public will learn the portraits of the lower
denominations they will be protected from the raising of curreiicy,
and from counterfeiting in general, to a degree not possible,in the past.
Having thus determined the problem of design, which in itself was
in some respects exceedingly difficult to work out, and having given
definite approval to the models, the next step was the execution of the
engraved stock. First the engraved dies had to be made and approved
in turn. From these, master rolls were prepared and then in turn a
suflBicient number of plates to supply hundreds of presses each with
four plates for printing. Our next problem was that of production.
I t was necessary to print for a complete turnover of United States
and Federal reserve currency approximately 76,000,000 sheets of
12 subjects each, or 912,000,000 individual pieces. These have to go
through the various operations of wetting, back printing, examining,
a second wetting, face printing, examining, trimming, numbering and
sealing, and the final cutting into individual notes. After this they
are assembled into packages of 4,000 pieces for delivery to the Treasury.
Vast as is the capacity of the Bureau of Engraving and Printing to accomplish enormous tasks of this character, the production of this new
currency, in part carried on during a period of substantial production of
the old-size currency to meet the needs of the past months, has strained
the bureau's capacity to the utmost. However, this work has progressed to a point where I can assure you that the currency will be ready
for distribution upon the date contemplated in the Treasury announcements of last year, namety, in the early part of July of this year.
The exact date will be announced definitely within the next few
weeks.
In order that this new currency might have a longer life than that
of the old-size currency, extensive research work was undertaken
with the cooperation of the Bureau of Standards, the Bureau of Efficiency, and the manufacturers of the paper, to develop a type of
paper which would have a greater endurance and folding strength
and which would at the same time meet the manufacturing requirements of the Bureau of Engraving and Printing. I t is not every
paper of high strength that will stand the wetting and drying operations incident to the manufacture of currency. Our currency is
printed by the intaglio process on dampened paper. Paper when
moistened expands, but does not always contract uniformly as it
dries. A second wetting is necessary between the printing of the
backs and the faces. We require therefore a paper that will expand
and contract uniformly under these conditions in order that the
faces on each sheet of 12 notes may register with reasonable accuracy
against the backs previously printed. This is a somewhat severe
requirement, when combined with a stipulated thickness, structure,
and folding strength. We have, however, developed a paper believed
to be satisfactory in all these respects and with such an increased
SECRETARY OF THE TREASURY
327
strength that we are confident that the currency will have a longer
life. Further research will be undertaken to make this paper, if
possible, more resistant to dirt and grease. The new paper has no
prominent silk fiber. Such fiber as it contains is so macerated and
interwoven in the texture of the paper that it is not readily observed.
I t has long been felt that the prominent silk fiber was an encouragement to the counterfeiter, since it was so easily imitated.
The determination of even an approximate issue date was in itself a
difficult problem. I t had to be tentatively fixed before the engraving
had been completed and at a time when certain new and essential
machinery was being designed and manufactured. I t had to be
fixed with due regard to the exhaustion of the then existing stocks
of the several kinds of currency, to avoid waste thereof, and the
printing of old-size currency planned accordingly. In accordance with
this plan the Bureau of Engraving and Printing has delivered no new
old-size currency since the 1st of April, and probably by this date the
existing stocks of new old-size currency in the Treasurer's vaults and
the Federal reserve banks, other than certain stocks of national bank
currency and, I believe. Federal reserve notes, are pretty completely
exhausted. This means that during the next few weeks the average
standard of fitness of currency in circulation will be lowered, due to the
absence of any considerable issues of new bills. There is no way to
avoid this unless we were to produce more old-size currency, and this
would mean an accumulation that might in part be not required, thus
causing such unused stock to be sacrificed. In addition it would
require the redemption of much old-size currency while still in a fit
condition.
The problem of distribution is planned as follows: Prior to the
issue date, stocks of the new-size currency will be placed in reserve
custody in the 12 Federal reserve banks and in certain of their
branches. The initial issue will be on a date not yet determined, but
simultaneously to all banks. At this time all established denominations from $1 to $20, inclusive, of all kinds of currency except national
bank notes will be issued. The higher denominations of United
States and Federal reserve currency and the established denominations of national bank notes will follow as soon as possible. All
issues will be through the Federal reserve banks to member and
other banks, and all banks will be placed on an equal footing. There
are about 900,000,000 pieces of paper currency outstanding. During
the last fiscal year about 930,000,000 pieces of currency were redeemed and about 925,000,000 pieces of new currency were issued.
Roughly speaking, the replacement of the old-size currency with the
new small-size currency is the equivalent of about one year's ordinary
redemptions and issues. Of course, it would not be possible to undertake the replacement of all outstanding old-size currency at one time
or in a fixed limited period. Nor would it be possible to undertake
the replacement of all outstanding old-size currency on and after a
given date as rapidly as it might, by chance, be presented. Essential safeguards are necessary in handling this retirement of the old,
which, in effect, is the basis for the issue of the new.
Redemption is involved with certain legal and accounting restrictions, and, of course, there are physical limitations both at the
Federal reserve banks and the Treasury. Therefore, instead of an
immediate redemption of all outstanding old-size currency it will be
328
REPORT ON THE FINANCES
necessary for the issue to be made .over a certain period of time.
The Treasury and the Federal reserve banks will do everything to
make this period as short as possible. This means that at the very
outset all banks applying for currency will be rationed, as it were,
and each will be required to take a certain percentage of old-size
currency assorted from that most fit for circulation. This percentage of old currency will be gradually decreased until after a period
of a few months it is anticipated that all old-size currency presented
at Federal reserve banks will be replaced in full with the reduced-size
currency. I am referring now particularly to the United States
currency and the Federal reserve currency. (The issue of national
bank currency in reduced size I will refer to shortly.) Thus you will
see that for a period of perhaps three or four months, at least, both
sizea of currency will be in circulation, but with the old-size currency
gradually disappearing, and it is estimated that after several months
the old-size currency will be rather a rarity and will only be in circulation because it has not reached a bank for a period of several months.
While it will always be a valid obligation, it is safe to say that by
the first of the year it will not be in general circulation and will be
very rarely seen.
The problem of national-bank currency in reduced size is a distinct
one and in certain ways more difficult of solution than that of United
States or Federal reserve currency. When the Secretary of the
Treasury determined, as was announced on January 22, 1929, that
the bonds upon which the national-bank currency rests would not be
called for redemption in 1930, he simultaneously announced that this
currency would be issued in reduced size shortly after the other
currency. Work was at once undertaken to prepare designs which
would approximate as closely as possible in their essential features
the designs for the other types of currency. These have been completed and the engraving is now almost accomplished. The exact
time and manner of distribution are still under consideration. There
are approximately 6,300 issuing banks and their currency represents
approximately 15 per cent of all outstanding currency in dollar value.
In pieces this currency numbers about 70,000,000. The printing of
this large amount, with the appropriate names of the various banks
on different denominations, is in itself an enormous task. I t has
required, first of all, a careful verification of the charter names and
the^ securing of facsimile signatures of the oflicers who have in the
past signed by pen or through overprinting with local printers. These
signatures will now be printed on the bill at the same time that the
title of the bank is printed. It is our aim to plan a method of distribution which will, as nearly as possible, give all national banks a
certain amount of reduced-size currency for issue simultaneously or
as nearly simultaneously as possible. There are problems connected
with this issue, and especially in connection with the size of the 5 per
cent redemption fund and the redemption procedure, which are very
difl&cult of solution, but I can assure you that it is our aim to show no
favoritism, either sectional or otherwise, in this distribution, but to
accomplish the replacement as generally and as rapidly as conditions
will permit. However, it is quite evident that this kind of currency
will require a longer period for its complete replacement than the
other types of currency require, due to the problem of sorting and
redemption, the size of the redemption fund, and other related matters,
and therefore, it will be found in circulation for a somewhat longer
SECRETARY OF THE TREASURY
329
period than the other currency. I t is probable that it will take at
least six or seven months to complete the turnover of national-bank
currency, even under the most favorable conditions.
We recognize that there will be at the beginning of the turnover
period a certain abnormal demand for the new currency, due to the
natural curiosity of the public to see the new designs in the reducedsize currency. We believe that the stocks which will be available
and which can be issued will be sufficient to meet this demand. I t
should be noted, however, that there will be no distribution of new
currency in entire sheets to the general public.
You will see from the above that you, as bankers, have an important
part in the program. I t is only through your cooperation that we
can hope to accomplish this turnover with a minimum of annoyance
and disturbance in the currency. With your cooperation the public's
requirements for the new currency can be held within the limits of our
immediate ability to meet them and the process of the turnover thus
made successful. Not only must each bank be patient in its demands,
but we ask you to preach the doctrine of patience to your customers.
Similarly the problem of the Federal reserve banks is one of cooperation, on the one hand, with member banks and other banking institutions, so as to meet their demands for currency as fully and rapidly
as facilities will permit, and, on the other hand, to cooperate with the
Treasury so that these demands may be kept withui the necessary
limitations which the Treasury must impose. I bespeak for them
your sympathetic cooperation in this difl&cult period.
The national banking uistitution presents a special problem, in
that all banks are asked to keep in circulation old-size national bank
currency over a somewhat prolonged period of a number of months,
thus meeting fully the public requirement for currency. In return
for this cooperation, on which we confidently rely, I can assure the
banks that the Treasury will make every endeavor not only to hasten
production and issue of national bank currency in reduced size at the
earliest possible date, but also in sufficient volume to accomplish its
complete substitution for the old-size currency just as rapidly as the
redemption facilities will permit.
In order that all of these problems may be successfully solved, the
Treasury is planning certain publicity features. We regard it as
important that at the very outset of this turnover period, a period
without precedent in the history of the country, the public should be
thoroughly acquainted with the essential features of the new currency,
so that the passing of counterfeits mil be impossible. To this end it
is planned to place on exhibition in all banking institutions which
desire to participate specimen sets of the lower denominations,
supplied at the face value purely for exhibition purposes in advance
of the actual issue date. This advance distribution of specimens
will be strictly limited to banking institutions. Full details as to
this distribution of specimen sets will in due course be furnished by
the Federal reserve banks in the respective districts through whom
alone such distribution will be made. This is one of several features
of this kind which the department is planning to inaugurate for the
purpose of acquainting the public in advance with the essential
features of the new currency.
In conclusion, I appeal to the public for a sympathetic appreciation
of the gigantic problems which have confronted the Treasury in this
330
REPORT ON THE FINANCES
program and for their cooperation during the turnover period. I t is a
period of great difficulty such as has never before been faced in
currency matters. If the public will but realize that the Treasury is
making every endeavor to accomplish a complete turnover as rapidly
as possible, they will be content for a certain period before the actual
issue to accept the old-size currency in a condition of wear which
would ordinarily require its redemption, knowing that this is a necessary LQcident of the program, and, secondly, they will cheerfully
acquiesce to the necessity of using two sizes of currency for a limited
period, knowing that thereafter the country will go forward with the
reduced-size bills which will be far superior in beauty of design,
simplicity, protective features, wearing qualities, and general convenience. In addition, there will be a very large annual saving in
cost of production, as, roughly, we will print 12 small notes for the
cost of 8 old-size and at the same time, avoid a large expansion of
plant at the Bureau of Engraving and Printing within the next few
years which would otherwise have been necessary. These ends are
so highly desirable that the temporary inconveniences should not, and
I am sure will not, be magnified and are certain in the end to be
speedily forgotten.
EXHIBIT
30
Statement of Secretary of the Treasury Mellon concerning the new smallsize currency (press release, June 3, 1929, with Department Circular
No. 415)
Secretary Mellon to-day announced that July 10, 1929, has been
set for beginning the issue of the new small-size currency. The issue
will be made through the Federal reserve banks and branches. For
the initial issue. Federal reserve banks have been authorized to make
available to the commercial banking institutions of their respective
districts limited amounts of new small-size currency on an equitable
basis established by them. Federal reserve banks will communicate
with all banks and trust companies in their respective districts giving
full instructions for participation in the initial distribution of the new
currency. After the initial issue of new small-size currency, the
procedure now in effect for supplying the paper currency requirements
of the country will in general, be followed, and in making payments
of currency the Treasurer of the United States and the Federal reserve banks and branches will pay out old-size currency fit for further
circulation concurrently with new small-size currency. Replacement
of the outstanding old-size currency with the small-size currency,
accordingly, will be a gradual process and, except for the initial issue,
will largely be governed by the redemption of old-size currency unfit
for further circulation.
The first issues of the new small-size currency will include all kinds
except national bank notes and all denominations from $1 to $20.
Small-size gold certificates and Federal reserve notes in denominations
above $20 will be issued at a later date. Small-size national bank
notes will be printed and issued in order of charter numbers beginning
about July 15, 1929.
For the reduced-size currency wholly new designs on a denominational basis have been adopted. The revision of designs will eliminate
SECRETARY OF THE TREASURY
331
existing confusion and will furnish a new and more effective protection
to the currency issues of the United ^States against counterfeiting and
fraudulent alterations. Generally speaking, the designs have been
simplified, and, as just indicated, there is a characteristic design for
each denomination.
Treasury Department Circular No. 415, dated June 3, 1929, will
govern the issue of the small-size currency. No issues of the new
currency will be made to the public before July 10, 1929. Specimens
of the new currency in unseparated sheets will not be available. Any
outstanding old-size paper currency heretofore or hereafter issued
will not be recalled; it will be retired gradually in regular course of
business, and in the meantime its validity will not be affected by the
issue di the new small-size currency.
The Treasury appreciates that during the period when the two
sizes of currency are in circulation this will be a matter of some inconvenience to the general public. However, it is believed that the
department may confidently ask for their indulgence and cooperation
in view of the ultimate advantages to be gained.
Accompanying this statement will be found:
1. A description of the essential characteristics of the designs of
the small-size currency.
2. A copy of Treasury Department Circular No. 415, dated June
3, 1929, governing the issue of the small-size currency.
DESCRIPTION
The new size for the paper currency is 6^6 by 2^K6. inches. The
principle of denominational designs has been strictly followed. The
back designs are uniform for each denomination, irrespective of kind.
The face designs, likewise, are characteristic for each denomination as
regards the important protective features, with only sufficient variation in detail to indicate the kind. Five kinds of paper currency are
now issued—United States notes, silver certificates, gold certificates,,
Federal reserve notes, and national bank notes. The new designs
will be applied to all issuable denominations of all these kinds.
The portraits assigned to the faces and the embellishments provided for the backs of the several denominations are as follows:
Denomination
$1
$2
.$5
._
$10
$20.
$50
$100.
$500
$1,000
$5,000--.-•
$10,000
Portrait on face
Embellishment on back
Washington
Ornate ONE.
Monticello.
Jefferson
Lincoln Memorial.
Lincoln
United States Treasury.
Hamilton.Jackson
----- White House.
United States Capitol.
Grant
Independence Hall.
Franklin
Ornate FIVE H U N D R E D .
McKinley
Ornate ONE THOUSAND.
Cleveland
Madison.
Ornate FIVE THOUSAND.
Ornate T E N THOUSAND.
Chase
332
REPORT ON THE FINANCES
The backs of the new currency will be printed uniformly in green;
the faces will be printed in black, and the Treasury seals and the
serial numbers mil be imprinted in the following colors:
Silver certificates
United States notes
Gold certificates
Federal reserve notes.
National bank notes
•
Blue
Red.
Yellow.
Green
Brown
For the reduced-size currency a new type of distinctive paper has
been adopted. The paper basically is of the type developed during
the past few years with a,higher folding endurance, particularly in
the cross direction, than the paper formerly in use. The use of small
segments of silk fiber as a distinctive feature has been retained, but the
segments are scattered throughout the sheet and not localized in
rows as formerly. The reason for the change is that, as a test of
genuineness, dependence may not be placed on an outstanding characteristic, which, in itself, inherently affords no protection.
Department Circular No. 415, supplementing Department Circular No. 55, as revised January 26, 1927
TREASURY DEPARTMENT,
Washington, June 3, 1929.
The Secretary of the Treasury has heretofore announced the adoption of a reduced size and wholly new designs for the paper-currency
issues of the United States.
The date Jul}^ 10, 1929, is now set for the initial issue of new
small-size currenc}^; and thereafter old-size currency, redeemed as
unfit for further circulation, will be replaced with new small-size
currency. The issue will be made through the Federal reserve banks
and branches. For the initial issue the Federal reserve banks 4iave
been authorized to make available to the commercial banking institutions of their respective districts limited amounts of new smallsize currency on an equitable obasis established by them. After such
initial issue, in making payments of currency, the Treasurer of the
United States and the Federal reserve banks and branches will follow
the usual procedure and will pay out available old-size currency fit
for further circulation concurrently with new small-size currency iii
such proportion of each as may from time to time be determined.
The initial issue will include all kinds of currency except national
bank notes and all denominations from $1 to $20. Small-size gold
certificates and Federal reserve notes in denominations above $20
will be issued when available without further notice. Small-size
national-bank notes will be printed for issuing banks in order of
charter numbers, and, commencing about July 15, 1929, will be issued
according^, as available, against redemptions of old-size bank notes.
Any outstanding old-size paper currency heretofore or hereafter
issued will not be recalled. I t will be retired gradually in regular
course of business, and in the meantime its validity will not be affected
by the issue of the new small-size currency.
A. W.
MELLON,
Secretary of the Treasury.
SEGPETARY
OF
THE
EXHIBIT
TEEASURY
333-
31
Copy of the letter dated June 3, 1929, addressed to the president of each
national bank relative to the issue of small-size national-bank notes
J U N E 3,
1929.
Last January I reached the conclusion that the early
Tetirement of our national-bank circulation would be inadvisable,
and, appreciating the fact that national-bank notes would be at a
distinct disadvantage if continued in the old,, size after all other
kinds of currency had been issued in the new small size, took immediate measures for including them in the general program for reduction
in size and revision of designs.
The situation has presented many perplexing difficulties of design
and production as it is necessary to provide new small-size currency
separately for over 6,000 issuing banks. I am now pleased to advise
you that production of national-bank notes in the nev/ smah size,
and with the same characteristic denominational features of designsas fixed for other kinds of currency, is assured. The preliminary
work is well advanced, actual printing will commence about July 15,.
and the first of the new small-size bank notes will be issued beforethe end of that month. Printing will proceed in the order of charter
numbers, and it will take about three months to complete the printing for all banks.
The only available means for replacing the outstanding old-size
national-bank currency with the new small-size currency is through
the established redemption procedure. The usual routine involves^
(1) cancellation of unfit notes by Federal reserve banks; (2) payment
therefor by the Treasurer of the United States; (3) assortment of thenotes to the bank of issue; (4) charges to the 5 per cent fund of the
particular banks involved; (5) reimbursement of the 5 per c e n t i u n d
by national banks of the notes redeemed; and (6) issue and shipment
of a like amount of new notes. The new small-size notes may b e
issued to a bank only as its own old-size notes are redeemed. In the
most favorable circumstances this will be a slow process. While the
printing is going forward, new small-size notes will be progressively
issued to the national banks for which they are available in the
amounts of the old-size notes redeemed for those banks. As the new
currency will be printed in order of charter numbers, the initial
issues to the banks will be made in the same order. Upon completion
of the printing, increased redemption facilities will be made available,,
with a view to replacing the old-size notes then outstanding with t h e
small-size notes as expeditiously as possible. With more than the^
usual redemptions, the 5 per cent fund will be inadequate to coyer
the Treasurer, unless immediate reimbursements are made by national
banks. Accordingly, during the period of increased redemptions,
beginning about October 1, 1929, as old-size notes are redeemed for
any issuing bank, the appropriate Federal reserve bank will be advised
and instructed to charge the reserve account of the national bank
concerned for reimbursement of the 5 per cent fund, with immediate^
credit to the Treasurer of the United States. New small-size notes
will thereupon be issued and shipped. The Federal reserve banks,
will take up this matter with the issuing banks, with a view to fixing;
a definite procedure.
DEAR SIR:
334
REPORT ON T H E FINANCES
We are about to inaugurate the replacement of all kinds of paper
currency outstanding with currency of a smaller size. The amount
involved approximates $5,000,000,000, in almost 900,000,000 pieces.
This is a tremendous undertaking, and unless carefully safeguarded
might result in serious money disturbance. Moreover, neither the
Treasury nor the Federal reserve banks could undertake to handle
the business unless restrictions are imposed. The Treasury is not
calling in the old-size currency, nor is it undertaldng an immediate
replacement of all outstanding old-size currency. Neither is it making
any special provision for the direct exchange of the old size for the
small size. On the contrary, for the issue of all lands of small-size
currency, the usual procedure in effect for supplying paper currency
will be followed so far as possible. New small-size currency will be
made available to cover the redemptions of old-size currency unfit for
further circulation, and, generally, payments of currency by Federal
reserve banks will include both new currency and circulated currency
fit for further use, the new currency being of the small size, and the
circulated currency at first being of the old size but later of the small
size. The issue of small-size United States currency and Federal
reserve notes will commence July 10, 1929. The issue of small-size
national-bank notes will commence before the end of July, against
the redemption of old-size bank notes of those banks for which smallsize notes are available.
The circulation of both sizes of all kinds of currency for a considerable period will be necessary. This is unavoidable in the circumstances, and particularly is it true with respect to the national-bank
circulation. That the presence of two sizes of currency in use at the
same time will cause inconvenience to the commercial- banks and to
the public generally is appreciated. But there is no possible escape
from this situation. As soon as it is possible to pay out only smallsize currency it will be done. Meanwhile, if the national and other
banks, in making deposits of currency, or in obtaining currency, will
restrict their transactions with the Federal reserve banks to their
usual business requirements, the transition from the old size to the
new size will in the end be greatly facilitated, and the possibility of
the situation getting out of hand will largely be avoided.
I am confident I can count on the fullest cooperation of your bank
with the Treasury and the Federal reserve banks in- maintaining in
active circulation such amount of old-size currency as may be necessary during the period required for the orderly substitution of the
small for the old size.
Cordially yours,
»
A. W.
MELLON,
• Secretary of the Treasury.
To the president of the national bank addressed>
SECRETARY OF THE TREASURY
EXHIBIT
335
32
Designation of paper currency issues (Department Circular No. 416)
TREASURY DEPARTMENT,
O F F I C E OF THE SECRETARY,
Washington, July 1, 1929.
In all accounts, records, or statistics now or hereafter established
by the department with respect to any of the paper currency issues
of the United States, a separation shall be made as between the oldsize and the reduced-size currency. The term ^^Old series" may be
used to designate currency heretofore issued and the term ^^New
series" may be used to designate reduced-size currency.
OGDEN L . M I L L S ,
Acting Secretary of the Treasury.
ALIEN PROPERTY AND MIXED CLAIMS
EXHIBIT
33
Temporary 5 per cent participating certificate, dated January 15, 1929^
issued by the Secretary of the Treasury to the Alien Property Custodian,
representing an investment of $8,500,113.15 as authorized by the
settlement of war claims act of 1928
PEMPORARY 5 P E R CENT PARTICIPATING CERTIFICATE, DATED JANUARY
15, 1929
$8,500,113.15
This is to certify that the Alien Property Custodian has invested
the sum of eight million five hundred thousand one hundred thirteen
dollars and fifteen cents ($8,500,113.15) as authorized by subsection
(a) of section 25 of the trading with the enemy act. as amended, and
has thereby acquired a participating interest, in accordance with the
provisions of section 4 of the settlement of war claims act of 1928,
in the funds in the German special deposit account created by said
section. Payments on account of the sum so invested, with interest
at the rate of five per cent per annum (payable annually, as nearly
as may be), will be made in accordance with, and subject to the
priorities of, the provisions of said section 4, or any amendment
thereof, under such regulations as the Secretary of the Treasury may
from time to time prescribe. This certificate is issued under the
authority of-the provisions of subsection (e) of section 25 of the
trading with the enemy act as amended. The United States assumes
no liability, directly or indirectly, for the payment of any part of the
principal amount of this certificate or of any interest thereon except
out of the funds available therefor in said special deposit account.
This certificate is not transferable, but may, upon presentation to
the Secretary of the Treasury, be exchanged for new certificates, one
or more of which will be transferable in accordance with the provisions of paragraph (2) of subsection (e) of section 25 of the trading
with the enemy act as amended, or any amendment thereof, and
such regulations as the Secretary of the Treasury maj^^ from time to
time prescribe.
A. W.
MELLON,
Secretary of the Treasury.
336
REPORT ^ON T H E FINANCES
EXHIBIT
34
Agreement efiected by exchange of notes betioeen the United States and
Germany as to the extension of the jurisdiction of the Mixed Claims
Commission, United States and Germany, signed December 31, 1928
[The Secretary qf State to the German Ambassadorl
DEPARTMENT OF STATE,
Washington, December 31, 1928.
EXCELLENCY: I have the honor to refer to your note of November 26, 1928, regarding the concluding of an agreement between the
United States and Germany for the extension of the jurisdiction
of the Mixed Claims Commission, United States and Germany, to
include claims of the same character as those of which the Commission now has jurisdiction under the agreement between the two
Governments signed August 10,1922, which were not filed in time to be
submitted to the Commission under the terms of the notes exchanged
at the time of signing that agreement but which were filed with the
Department of State prior to July 1, 1928.
You state that your Government is prepared to do its share to
bring about a settlement of these so-called late claims, but that it
considers that the preparation and adjudication of the claims should
be governed by the same legal principles as have so far been applied
in the proceedings of the Mixed Claims Commission, and that means
should be found by which a prompt and speedy preparation and
adjudication of the claims involved may be fully guaranteed. Your
Government suggests that as an appropriate means to this end,
fixed and final terms should be agreed upon for the filing of claims
and defense material, including the necessary evidence, and that a
requirement should be made that all claims to be adjudicated by the
Commission should be presented for judgment within a fixed period
of time. You add that, owing to the fact that the adjudication of the
late claims will necessitate the continuance of the expensive machinery
of the Mixed Claims Commission for some months, which would
not otherwise be necessary or which would not have been necessary
to the same extent if the claims had been presented within the time
prescribed b}^ the agreement of August 10, 1922, your Government
considers that the claimants for w^hom a remedy will thus be afforded
should participate to an appropriate extent in the expenses which
will result from the prolongation of the life of the Commission. This^
you suggest, might be accomplished by the collection of a fee for the
final filing of each claim, thus eliminating to the greatest possible
extent claims which are unfounded or which are presented in unjustified amounts, and an additional fee for preparing and adjudicating
the claim.
I desire to express my appreciation of the willingness of your
Government to cooperate with my Government in an effort to complete the adjudication of the claims defined above. M y Government, equally with your Government, is anxious that the work of the
Mixed Claims Commission should be completed at the earliest date
practicable and will use its best endeavors to that end. With respect
to your suggestion that the claimants who will be benefited by an
extension of time for the presentation of so-called late claims should
share to an appropriate extent the additional expense incident to the
prolongation of the labors of the Mixed Claims Commission, my
SECRETARY OF T H E TREASURY
337
Government considers that it would be not feasible to require the
deposit of a fee as a condition precedent to the adjudication of the
claims. In an effort, however, to meet the views of your Government
that it should be relieved of this additional" expense, the President
would be willing to recommend to the Congress that the one-half of
one per cent, which the Secretary of the Treasury is authorized by the
" Settlement of War Claims Act of 1928 " to deduct from awards made
by the Mixed Claims Commission before payment thereof to the
claimants as reimbursement for the expenses of the United States
incident to the adjudication of the claims, shall, in so far as regards the
late claims, be made available to your Government for defraying
such expenses as may be incurred by your Government in connection with the adjudication of such late claims. I, therefore, suggest
the following as the terms of the agreement between the two Governments :
(1) That all the late claims of American nationals against Germany,
notice of which was filed with the Department of State prior to July 1,
1928, of the character of which the Mixed Claims Comniission, United
States and Germany, now has jurisdiction under the claims agreement concluded between the United States and Germany on August
10, 1922, shall be presented* to the Commission with the supporting
evidence within six calendar months from the first day of February,,
1929;
(2) T h a t the answer of the German Government to each claim
presented shall, together with supporting evidence, be filed with the
Commission within six calendar months from the date on which the
claim is presented to the Commission, as provided for in paragraph 1;.
(3) That the subsequent progress of the claims before the Commission, including the submission of additional evidence and the filing
of briefs, shall be governed by rules prescribed by the Commission,
it being understood that both Governments are equally desirous of
expediting the completion of the work of the Commission;
(4) That the preparation and adjudication of the claims shall be
governed by the same legal principles as have so far been applied in
the proceedings before the Mixed Claims Commission;
(5) That the President will recommend to the Congress that the
one-half of one per cent, which the Secretary of the Treasury is
authorized by the ^'Settlement of War Claims Act of 1928" to deduct
from awards made by the Mixed Claims Commission before payment
thereof to the claimants for application to the expenses of the United
States incident to the adjudication of the claims, shall, in so far as
regards the late claims, be made available to the German Government for defraying such expenses as may be incurred by that Government in connection with the adjudication of such late claims.
Upon the receipt from you of a note expressing the concurrence
of your Government in the conditions outlined in paragraphs 1 to
5 inclusive, the agreement contemplated by paragraph (j) of Section 2
of the '^Settlement of War Claims Act of 1928" will be regarded as
consummated.
Accept, Excellency, the renewed assurances of my highest consideration.
FRANK B .
His Excellency
Herr FRIEDRICH WILHELM VON PRITTWITZ
Ambassador of Germany
71799—30—FI 19 2 9
24 ;
KELLOGG.
UND GAFFRON
338
REPORT ON T H E FINANCES
[The German Ambassador to the Secretary of Statel
[Translation]
GERMAN EMBASSY,
Washington, D. C , December 31, 1928.
Mr. SECRETARY OF STATE: I have the honor to acknowledge receipt
of Your Excellency's note of December 31, 1928, with reference to
the adjudication of the late claims before the Mixed Claims Commission, United States and Germany.
In reply thereto I beg to express to Your Excellency the concurrence
of my Government in the proposals for adjusting this matter, as
outlined in paragraphs 1 to 5 inclusive of Your Excellency's note, and
to inform you that my Government considers the agreement contemplated by subsection (j) of Section 2 of the '^Settlement of War
Claims Act of 1928" as thus consummated.
Accept, Excellency, the renewed assurance of my highest consideration.
F.
W.
v.
PRITTWITZ
His Excellency
The Secretary of State
of the United States
Mr.
FRANK B . KELLOGG
Washington, D . C .
EXHIBIT
35
Letter from the Secretary of the Treasury to the Austrian Minister at
Washington, August 22, 1929, relative to the Austrian special deposit
account, together with statements in connection therewith
AUGUST 22,
1929.
Under date of December 7, 1928, the
Alien Property Custodian, by virtue of the authority contained in
section 25 (g) of the trading with the enemy act, as amended, authorized to be deposited in the Austrian special deposit account, created
in the Treasury by the settlement of war claims act of 1928, the sum
of $1,434,852.21 for the purpose of enabling the Secretary of the
Treasury to make payment on account of the aw^ards of the Tripartite
Claims Commission against Austria. The Alien Property Custodian
h a s to-day authorized a further deposit of $14,267.08, representing
the earnings on the first-mentioned fund from September 15, 1928, to
December 7,^ 1928. To the extent that the funds in the Austrian
special deposit account were not iinmediately needed to meet current
payments, the Secretary of the Treasury, under authority of the
settlement of war claims act of 1928, kept such funds invested in
obhgations of the United States, which resulted in further earnings
and profits to the fund of $43,727.55. This made available a total
amount of $1,492,846.84. After deducting the payments made by
the Secretary of the Treasury and reserving a suflicient amount to
cover the payments yet to be made, there remains to the credit of
the Austrian special deposit account the sum of $1,122,814.70.
In this connection reference is made to your recent inquiry through
the Department of State as to whether the amount not needed to
M Y DEAR M R . MINISTER:
SECRETARY OF T H E TREASURY
^.
.339
^make payment of awards against Austria could not now be returned
t o your Government. Undersecretary Mills advised the State Department under date of May 31, 1929, that he saw no objection to
the return of the fund, provided that an amount sufficient to take
-care of the unpaid awards, with interest, is retained by the Treasury
for their payment. In accordance with this understanding, I take
pleasure in transmitting herewith check No. 337, for $1,122,814.70,
drawn on the Treasurer of the United States under date of August
22, 1929, the amount of which represents the balance of the funds
in the Austrian special deposit account liot needed for payment of
the awards against your Government.
There are also transmitted herewith (I) statement of the Austrian
special deposit account; (II) statement showing individual awards
which have been paid by the Secretary of the Treasury out of the
funds in the Austrian special deposit account; and (III) statement
.showing individual awards not yet paid but for which sufficient funds
are retained in the Austrian special deposit account for their payment
when properly executed applications have been filed by the claimants.
I believe you will find that these statements furnish your Government a complete accounting of its funds deposited in the Austrian
•special deposit account under authority of the trading with the enemy
act, as amended.
I shall appreciate it if you will let the Treasury have an acknowl-edgement of this letter with its enclosures.
I am, my dear Mr. Minister,
Very truly yours.
Secretary of the Treasury.
Mr.
EDGAR L . G . PROCHNIK,
Envoy Extraordinary and Minister Plenipotentiary,
The Austrian Legation, Washington, D. C
i.—Statement of the Austrian special deposit account in the Treasury of the United
States created by the settlement of war claims act of 1928
Funds deposited in the Austrian special deposit account by the
Alien Property Custodian under the provisions of subsection
(g) of section 25 of the trading with the enemy act, as amended. $1, 449, 119. 29
Earnings and profits on investments
43, 727.. 55
Total funds belonging to the Austrian Government
Net payments on account of the awards of the
Tripartite Claims Commission against Austria. _ $358, 749. 92
^ Deductions of one-half of 1 per cent from payments required' by the settlement of war claims
act of 1928
1, 802. 77
1, 492, 846. 84
Total payments in United States currency
as shown on Statement II (awards paid) _ 360, 552. 69
Amount retained to pay awards, including interest
thereon, for which proper applications have not
been received (Statement III, unpaid awards).,
9, 479. 45
Amount of awards in United States currency certified to the
Treasury for payment by the Commissioner of the Tripartite
Claims Commission
^
Balance returned to the Austrian Government
370, 032. 14
1, 122, 814. 70
340
REPORT
oisr
THE
Fii^rAisrcES
II.—Awards and interlocutory judginents against Austria certified for payment ta
mission pursuant to the provisions of
K for kronen.
GK for gold kronen.
F for florin.
GF for gold florin.
G for gulden.
GG for gold gulden.
SG for silver gulden.
F. fcs. for French francs.
G. F. fcs. for gold French francs.
£ for English pound.
G£ for gold English pound.
M for German mark.
GM for gold German mark.
" A w a r d " indicates a final judgment expressed in United States currency.
VB-l" indicates an interlocutory judgment of the class B (1) expressed in the contractual currency,,
the claim having been impressed with American nationality throughout the period of belligerency.
" B - 2 " indicates an interlocutory judgment of the class B (2) expressed in the contractual currency,,
the claim having become (on the date indicated) impressed with American nationality during the period
of belligerency.
AWARDS PAID
C l a i m a n t on behalf of w h o m j u d g m e n t is
entered
Date
certified
A b e k e n , R o d o w e . H . , executor of estate of
F . W . A b e k e n , deceased
.
Dec. 7, 1928
Adams, I d a .
do
Adler, S t e p h e n 0
do. . . .
AlgasCj Celia-A__
do
A l t m a n , Sam
A p r . 6, 1929
Altman, Sam, Morris Altman, a n d H a r r y
Altman...
.
D e c . 7, 1928
Alps, William
_
do
A m a n n Albprt' Thpodnrp
do
American Express Co
"."Ido-II^;
American T r u s t Co., executor of will of T h e o dore H e r m a n Michels, deceased
. do...
Do
do
. . do
A t k i n s & Co., E . C . . .
A t l a n t i c M u t u a l I n s u r a n c e Co
do
Baar, G u s t a v
do
B a d e r , L i d w i n a , a d m i n i s t r a t r i x of estate of
Carl Josef Bader, d e c e a s e d . . .
do
do
Do
do
Bastgen, H u b e r t . _
Belling, Clemens . . .
_ do
do
Belling, H e n r i e t t e
. . do
Bender, Charles
do..
Berohem, C h a r l o t t e M a t i l d a
do
Berger, G e z a . .
Beyer, F r e d . . .
do. .
Blaustein, Joseph
do
B o n d y , E m i l J., as n a t u r a l g u a r d i a n of.Anna
do
Louise Bondj'^v
.. ..
Bondy, Anton _
. do
Bondy, Emil
do
Do...
Bondy, H u g o . .
Bondy, Oscar...
. . . .
B o n d y , Otto
Bonn, Theodore F
^...
Do
Brentin, J o h n . .
Do
Do
Brida, D a n i e l .
Brody, Josephine..
B u r d a c k , A n n a , whose n a t u r a l g u a r d i a n is
Carl B u r d a c k
B u r d a c k , H e l e n , whose g u a r d i a n is Carl
B u r d a c k . . _.
._
_
B u r d a c k , Elsie, whose g u a r d i a n is C a r l
Burdack
C a s p a r y , Carl
Do
Caspary, F r e d . .
Do
Caspary, Josephine
Do
:
Docket N o .
Class
of
judgment
319
320
323
1215
328-D
B-2
B-l
B-l
B-l
B-l
329-A
327
330-A
332
B-l
B-2
B-l
B-l
1146-A
1146-C
13
1
4
Rate
of
interest
Principal
P.ct.
0
4
0
0
0
F . fcs.
67. 50
K.
12, 774. 57
K.
82.50
K.
5,493. 80
K.
6, 080. 00
0
0
2
5
K.
K.
K.
K.
2,400.00
302.50
142.96
76, 588. 76
B-l
B-l
B-l
Award
B-l
0
0 .
2H
5
3
G. G.
360. 00
M.
400.00
K.
17, 623. 76
$
2,338. 57
K.
42, 050. 00
344-B
344-A
354
132
186
362
1093
365
372-B
380-B
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-2
B-l
4
3
0.
3H
3%
0
0
6
3
0
K.
3, 469. 20
K.
147.34
K.
1,150. 00
K.
7,861. 01
K.
31,421-. 85
K.
2,145. 00
Q . G.
224. 00
K.
5,000. 00
K.
603.07
K.
335.00
309
388
389-A
B-l
B-l
B-l
do
389-C
B-l
do
A p r . 6, 1929
D e c . 7, 1928
A p r . 6, 1929
do. . . .
D e c . 7, 1928
do
do
do.
do
390-B
391
392
393-A
393-B
401-A
401-B
401-C
402-B
405-A
B-l
B-l
B-l
B-l
B-l
B-2
B-2
B-2
B-l
B-l
3 % K..
K.
3
3 % K..
fF.
0 |:G.
(i'K.
K.
0
K..
3
K.,
3
K.
0
K..
3
3
K..
0 1 K.
0 1 G.
3 . K..
3 ; K.
do
411
B-2
0
! K.
do
411
B-2
0.
1 K..
do
do
do
do
do
do
do
411
418-B
418-A
419-A
419-B
420-B
420-A
5,196. 93
953.00
6, 482. 89
4.49
89.90
359.59
710.00
953.00
953.00
336.00
1, 722. 04
3,481. 27
1, 044. 00
29. 97
20,486. 66
1, 044.19
275. 00
275. 00
1
0 ' K..
B-l
B-l
2% K.
B - l . 0 , K.,
B-l
0 •K..
B-l
2 ^ K.
B-l
2n K .
K..
B-l
0
275. 00
1,383.95
1, 375. 00
1,375.00
1, 383. 95
1,383. 95
Iv375..00
341
SECEETAEY OF THE TEEASUEY
the Secretary of the Treasury by the Commissioner of the Tripartite Claims Comthe settlement of war claims act of 1928
K for kronen.
GK for gold kronen.
F for florin.
GF for gold florin.
G for gulden.
GG for gold gulden.
SG for sfl ver gulden.
F.. fcs. for French francs.
G. F. fcs. for gold French francs.
£ for English pound.
G£ for gold English pound.
M for German mark.
GM for gold German mark.
"Award" indicates a final judgment expressed in United States currency.
" B - l " indicates an interlocutory judgment of the class B (1) expressed in the contractual currency,
the claim having been inapressed with American nationality throughout the period of belligerency.
" B - 2 " indicates an interlocutory judgment of the class B (2) expressed in the contractual-currency,
the claim having become (on the date indicated) impressed with American nationality during the period
of belligerency.
AWARDS PAID
Interest payable
To—
From—
Amount
Deduction of
T o t a l in one-half
nited
Net
Total due Conver- UStates
cfl
and payable sion r a t e
per cent a m o u n t
curas re- p a y a b l e
rency
quired
b y act
F. fcs. 67. 50j $0.12
7,19281 K. 5,587.30 K. 18,361.871 .06
K.
82.50 . ( 6
K. 5,493. 80 . ( 6
K. 6,080.00 .06
Dec.
31,1917 Dec.
Jan.
Jan.
K. 2, 400.00
K.
302.50
173.99
30,1918| Dec. 7,1928 K.
31.03 K.
1,1921
d o . . . ' K. 30,373.93 K. 106,962. 69
Date paid
$0.04
$8.06 Feb. 18,1929
5.51 1.096. 201 Dec. 24,1928
Do.
.02
4.93
1.65
327. 98
Do.
1.82
362.98 Apr. 24,1929
$8.10
1,101.71
4.95
£29.63
364. 80
144. 00
.06
. 002204
.67
.06
10.44
.•06
6,417. 76
.72
143. 28 Jan.
.00
.67 Jan.
.05
10. 39 Jan.
32.09 6, 385. 67 Feb.
G. G. 360.00
M.
400.00
Dec.
7,19171Dec. 7,1928 K. 4,846.53 K. 22,470.29
Dec. • 31,1914 Dec. 24,1928 $ 1, 634. 76 $ 3,973. 33
Dec.
7,1917' Dec. 7,1928 K. 13,876. 50 K. 55,926.50
. 48237
.]0
.06
173. 65
40.00
1,348. 22
3, J 73. 33
3, 355. 59
.87
172. 78
Do.
Do.
.20
39. 80
6.74 1, 341. 481 Dec. 31,1928
19.87 3,^53.46 Dec. 24,1928
16.78 3,338.81 Jan. 14,1929
Various
do
Dec.
7,19171
do
Dec.
7,1917 Dec. 7,1928
do
!
do...
285. 49
.06
11.76
.06
69.00
.06
653. 25
.06
2, 663. 00
.06
:28.70
.(6
.^8237
:.08.05
-•98.00
.06
.004522
3.60
20.10
.06
1.43
284.06 Mar. 11,1929
Do.
.06
11.70
.35
68. 65 Feb. 27,1929
3.27
649.98 Jan, 14,1929
13.32 2, 649. 68 Jan. 23,1929
.64
] 28. 06 Jan. 9,1929
.54
] 07. 51 Feb. 18,1929
2.49
{95. 5l| Dec. 31,1928
.02
3.58 Dec. 24,1928
.10
20.00 Mar. 6,1929
K. 1,289.01
K.
48.62
K. 3,026.49
K. 12,961. 51
Dec.
7,1917] Dec. 7,1928 K. 3,300.00
Various
do...
K.
193.17
4, 758. 21
195.96|
1,150.00
10,887. 50
44, 383. 36
2,145. 00
G. 224.00
8, 300.00
796. 24
335.00
340. 66
7,19281 K. 2,143.73] K.
do
K.
314.49 K.
267.49[
do
K. 2,674.19 K.
157.
F.
4.491
89.90
G.
359. 59
K.
710.00
K.
276.89
Dec.
7,1917 Apr. 6,1929 K.
K.
323.
267. 49
do...
314.491 K.
Dec. 7,1928 K.
336.00
K.
296. 24
574.20 K.
Various...
Apr. 6,1929 K.
540. 53',
Oct. 16,19181Dec. 7,1928| K. 1,059.26 K.
044. ool
K.
G.
29. 97
Dec. 7,19171Dec. 7,1928 K. 6,760.60 K. 27, 247. 26
do...., K. 344.58| K. L 388. 77
do...
Dec.
do
do
7,19171Dec.
Various..
Dec.
7,1928 K.
Various..
do..
Dec.
7,1928 K.
do...
K.
K.
368.1 K.
K.
K.
368.901 K.
368.90 K.
K.
.06
440. 44
.06
76.05
.06
549.42
.06
.:.2
.54
10.79
.12
.06
21.58 j
.06
42.60
76.61
.06
.(6
76.05
20.16
.(6
137.77
.(6
.(02204
10.01
.002204
2.30
. 004408
.13
1, 634.84
.06
83.33
.06
1
2.20
.38
2.75
.16
.82
.00
275. 00
.82
.00
16.50
] 05.17
82.50
82.50
105.17
105.17
82.60
. .08
.53
.41
.41
.53
.53
.41
275.00
1, 752.85
1,375. 00
1,375.00
1,752. 85
1,752. 85
1 375.0011
.06
.(16
.(16
.(16
.06
.<6
.06
438. 24 Feb. X8,1929
75. 67 Dec. 24,1928
546. 67 May 6,1929
32.75
Do.
.21
42.39 IJan. 21,1929
.38
76. 23| May 6,1929
.38
75.67 iJan. 9,1929
.10
20. 06! Apr. 24,1929
Do.
.69
] 37. 08
.05
9.96 Jan. 23,1929
2.29
.01
Do.
.00
.13
Do.
8.17 1,626. 67 Jan. 16,1929
.42
82.91 Dec. 24,1928
275. 00 .. 002991
. 002991
9,1929
23,1929
9,1929
6,1929
.82 Feb. 27,1929
.821
Do.
16.42
Do.
] 04. 64 Jan, 14,1929
Do.
82.09
Do.
82.09
Do.
:04.64
Do.
:04.64
82.09
Do.
342
REPORT ON T H E FINANCES
II.—Awards and interlocutory judgments against Austria certified for payme7itTto
mission pursuant to the provisionsfof
.A.WARDS PAID—Continued
Class
Claimant on behalf of whom judgment is
entered
Date
certified
Docket No.
Central Union Trust Co. of New York and
Alexander Amend, executors of estate of
Adolph Norden, deceased
1356
Dec. 7,1928
1239-B
Cerf, Josephine
..do...
1239-A
..do...
Do
Chase National Bank of the City of New
422-B
.do.,
York, The
243
.do.,
Corn Exchange Bank, The
1103-A
.do.,
Cucuel, Edward
.do.,
451
Danziger, Abraham L
.do.,
460-B
Deiiser, (IJharles P
.do..
46(>-A
Do
461-A
.do.,
Deutsch, Emil
.
472-A
-do.,
Dornbaum, Albert
1244
Eiss, Max
.do..
Ellison, Henry Howard, William Rodman
Ellison, and Henry Howard Ellison, jr.,
American partners in the late copartnership
- 484
of John B. Ellison & Sons
_
.do..
Ellison, Henry Howard, William Rodman
Ellison, and Henry Howard Ellison, jr.,
American partners in the late copartnership
of John B. Ellison & Sons
Jan. 31,1929 484 ( P a r t 57)
Equitable Life Assurance Society of the
1246
United States, The
..do...
Fay & Egan Co., J. A..
Fekete & Son, a copartnership composed of
Joseph Fekete, sr., and Joseph Fekete, j r . . .
Feringa, Mrs. John H., administratrix of
estate of John H. Feringa, deceased._
Fezandie, Hector, executor of estate of Felix
Fezandie, deceased
Finke, George
First National Bank at Pittsburgh
Fischer, Philip
Fischl, Julius.
Flader, Carl Albin Curt
Foster, Iza
Fraenkel, Frances H., a minor.
Frank, Cecelia.
Dec.
7,1928
of
judgment
Rate
of
m-
Principal
terest
P.ct.
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-2
0
0
0
K.
G. G.
G.
399. 65
16.00
29.97
0 , £
4,330-18-4
7.50
G. G. - 600.00
1,045.00
0 K.
67.08
0 K.
0 G. G . 1,600.00
152.00
0 K.
564.00
3 K.
6, 320. 36
3H K .
2H K .
0-'
K.
£
B-l
{1
B-l
5
£
B-l
0
G. G.
B-l
6
$ •
590.86
1,330.075
3.5208
1,200.00
434.62
1607-B
B-l
2H K .
.do.
1109
B-l
0
G.
.do.
.do.
.do.
.do.
.do.
.do.
.do.
.do.
231
498-A
1110
503-A
500
505
1252
1608-B
B-l
B-l
B-l
B-l
B-l
B-l
B-l
B-l
5
0
0
0
0
0
0
3
62, 636. 31
K.
K.
82.50
11,000.00
K.
677. 50
K.
K.
206. 25
K.
2, 750.00
G. G.
120. 00
K.
3,093. 00
.do.
515
B-l
0 ,
E:.
..do....
G.
B-l
B-l
B-l
B-l
B-l
B-2
B-l
B-l
B-l
K.
K.
K.
K.
K.
K. •
2y7. K.
3 K.
0 K.
5 $
2 K.
0 K.
0 K.
G. G.
0
0
0
0
3
7y4
6
16, 362.16
684.34
232. 00
40.00
..do.
..do.
..do.
..do.
..do.
..do..do.
..do.
..do.
..do.
..do.
..do.
.-do.
..do.
1256-A
530
532
538-B
548
549
232
557
558-A
1
1615-B
161&-A
1268-B
1268-A
Haas, Leo..
.do.
571-A
B-l
0
0
K.
G.
232. 00
2.50
Do..
.do
571-B
B-l
0
K.
28. 00
Friess, Hugo
Fuld, Leonhard Felix
Funk, Adelaide.
Gerstman, Albert
...Goldmuntz, Joseph
Goldmuntz, Paul
Goodman, David C
Gottlieb, Gisela..
Graf, Felix
Grubnau Bros. (Inc.)
Gruenenfelder, B
Do..
Guardian Life Insurance Co. of America, The.
Do
Award
B-l
B-l
B-l
B-l
5, 500. 00
17.12
2, 268.87
1,046.45
25, 390. 09
30,000.00
3,122. 67
46.00
240. 00
567. 69
110. 00
137. 50
9, 503. 66
10, 200.00
343
SECRETARY OE THE TREASURY
the Secretary of the Treasury by the Commissioner of the Tripartite Claims Comthe settlement of war claims act of 1928—Continued
AWARDS PAID—Continued
Interest payable
From—
To-
Amount
Deduct i o n of
T o t a l in one-half
nited
Net
Conver- -UStates
ofi
Total due
per cent paamy oa bulnet
a n d p a y a b l e sion r a t e
curas rerency
quired
b y act
K.
399.55 $0.06
G. G . 16. 00 .48237
G.
29.97 .12
$23. 97
7.72
3.60
£ 4, 330. 917 4.76
20, 616.16
51.20 .06
43.70 K .
3.07
, G. G. 600. 00 .48237
289. 42
K . 1,045. 00 .06
62. 70
K.
57.08 .06
3.42
G . G . I , 600. 00 .48237
771. 79
K.
152.00 .06
9.12
750.12 .06
Dec.
7,1917 D e c . 7,1928 K .
45. 01
186.12 K .
K . 2,433. 34 K . 8, 753. 70 . 003043
26.64
do
do.
Dec.
Various
7,1928 K .
d o . . . . . . K.
do
£
do
do
324.97 K .
731. 64 £
916.83 .06
2,061.616 4.76
.
7,1917 J a n .
31,1929 £
1. 9629 £
6.4837 4.76
G . G . I , 200. 00
Dec.
do
7,1928
$
do
7,1917
Jan.
i , 1921 D e c .
do
655.96
K . 4, 742. 82 K . 21,104.97
G.
Dec.
584.34
K . 34,394.97 K . 96,931.28
K.
82.50
K . 11,000.00
K.
577.50
K.
206.25
K . 2, 760.00
G . G . 120.00
3,828.98
7,1928 K .
736.98 K .
K.
G.
31,1917 Dec.
7,1917
1,1923
7,1917
do
do
do
do
do
342.94
7,1928 K .
K . 20,248. 60
K . 10,524.69
K.
858.73
K.
15.18
jSept. 6,1923 J a n . 14,1929 $
Various
D e c . 7,1928 K . '
49.34 9,818. 90 F e b . 20,1929'
25.97
Do.
26.10
.13
678. 84
2.89
675. 96 D e c . 24,1928^
655.96
3.28
652. 68 D e c . 24,1928-
232.00
40.00
.06
.12
.06
.06
.06
.06
.06
.06
.48237
.06
.06
.12
1, 266. 30
70.12
6, 815.88
4.95
660.00
34.65
12. 38
166.00
57.88
229. 74
152.03
23.70
6.33 1, 269. 97 J a n .
, .36
21,1929'
69.77 F e b . 20,1929
9,1929*
29.08 5,786. 80 J a n .
2,1929
4.93 J a n .
.02
656. 70 J a n . 14,19293.30
34.48 F e b . . 11,1929
.17
12.32 D e c . 24,192a
.06
164.17 F e b . 11,1929"
.83
57.59 J a n . 14,1929
.29
228. 59 A p r . 22,1929
1.16
13.92
4.80
18.72
Dec.
Dec.
Feb.
Dec.
103. 08 20, 612. 08 F e b . 20,1929
.02
3.05 M a y 20,1929
287. 97 D e c . 24,1928
1.45
9,1929
62.39 J a n .
.31
3.40 .Tan. 14,1929
.02
767. 93
Do. ^
3.86
9.07 M a y 6,1929
.06
44.78 J a n . 14,1929
.23
Jan.
2,192^
26.61
.13
238.99
17.55
221. 44 $
Various
.48237
$23.85 J a n . 23,19297.68 J a n . 30,1929
3.58
Do.
54.95
9, 813. 29
9,868. 24
Dec.
$0.12
.04
.02
Date paid
K.
6,600.00
K.
17.12
K.
2,268.87
K . 1,388. 39
K . 45,638.69
K . 40,524.69
K.
3,981.40
K.
61.18
K.
240.00
$
719.72
K.
133.70
K.
137.50
K.
9,603.65
G.G. 10,200.00
.06
330.00
1.03
.06
.06 .
136.13
.06
83.30
.06
2, 738. 32
.006893
279.34
.06
238. 88
.06
3.67
.06
14.40
719. 72
.06
8.02
.06
8.25
.06
670. 21
.48237 4, 920.17
K.
G.
232.00
2.50
.06
.12
K.
28.00
.06
.09
18.63 J a n .
328.35 A p r .
1.66
1.02 J a n .
.01
136.46 F e b .
.68
82.88 F e b .
.42
13.69 2,724. 63 J a n .
277.94 F e b .
1.40
237.69 D e c .
1.19
3.66 J a n .
.02
14.33 D e c .
.07
716.12 J a n .
3.60
7.98 D e c .
. .04
8.21
.04
667. 36 J a n .
2.85
24.60 4,896. 57
21,1929
24,1929
2,1929
4,1929
11,1929
14,1929
6,1929
24,1928
30,1929
24,1928
14,1929
31,1928
Do.
21,1929
Do.
13.92
.30
14.22
.07
1.68
.01
14.15 J a n .
L67
9,1929
Do.
344
REPORT ON THE FINANCES
II.—Awards and interlocutory judgme7its against Austria certified for payment to
mission pursuant to the provisions of
AWARDS PAID—Continued
Claimant on behalf of whom judgment is
entered
Date
certified
Docket No.
Class
of
judgment
Dec. 7, 1928
672
B-l
Hahn, Eleonore F
do ~Haller, Frieda
do
Do
do
Hartnagel, Estella
do
Hauswirth, William L
do
Hayn, Max G
do
Herschman, Marie
Apr. 6,1929
Herschman, Rudolf
do
Heifer, Antonie E .
_
Dec. 7,1928
Herz, Gustave L., as natural guardian of
Stephen Valentine Herz
do
Hejme, Johanna Gross
. . . do
Hieber, John G. F .... _
,_
'. _
do
Hill Olga
>
do
Hilton, Grace Greenwood.. . .
do
Hirsh, Julia, Alvin S. Hirsh, Donald Hirsh,
and Irving S. Ottenberg, executors of estate
of Jacob Hirsh, deceased
. . . do
Hoecker, Johri B^
,
do
do
H "Do..
Holz, Melanie
do
Hopley. James R.individually and as trustee
for Thomas P. Hopley, M. C. C. Hopley,
Georgia. E. Hopley, Harriet E. Hopley,
Frank L. Hopley, and Joseph W. Hopley..
do
Hubash, Joseph
do . . . .
do
Humphrey, Charles Franklin.
Huntley, Kathryn..
.
. . . . . do . . . .
1119
575-A
. 675-B
''
586
1272
691-A
1516
1517
694-A
B-l
B-l
B-l
B-l
B-2
B-l
B-2
B-2
B-l
1278-A
603
605-A
1123-A
6
B-l
B-2
B-l
B-l
Award
1281
613-C
613-A
615
Haberer, William F
Do
. .
Huth, Joseph
.
Hutter, Paul..
Do
. .
Illfelder, Max
Do
Indian Motorcycle Co
Jagemann, Anna..
. _.
Johns, Eva
Justi & Son, H. D
..
...i
Do
Kassekert, Fred
..
Kapetanich, Louis
Kavaler (Kawaler), Bernard
Kennedy, Joseph B
Klamer, Mabel F., administratrix of estate of
Hugo J. Klamer, deceased
Klein, Karl _.
Do
Kniker, Carl
Kolesch, Percy, executor of estate of Aline
Oertel, deceased
Kronig, Harold...
..1
La Fond, Rose W.._
Lebensart, Fannie
Leonhardt, Martin
Levias, Irene
Levias, Ruth
Lilienthal, Josephine W
.
Links, Elsa Guttman, executrix of estate of
Adolph Guttman, deceased
Links, Elsa Guttman, executrix of estate of
Adolph Guttman, deceased .
Littauer, Eugene
. . . do
Rate
of
interest
P.ct.
0
0
Principal
G.
F.
149.83
23.97
0
0
2
4
0
4
0
0
0
K.
K.
K.
K.
£
K.
K.
K.
K.
410.96
412.50
467.50
12,774. 57
5.625
60, 597. 80
137.50
137.50
328.00
ZH
3
0
0
5
K.
K.
K.
K.
$
2,239.03
3,563.12
11,660.00
1,070. 22
763.20
B-l
B-l
B-l
B-l
0
2
0
0
K.
K.
K.
K.
9,600.00
1,375.00
1,376.00
1,027. 50
617
227
627
1286-B
B-l
B-l
B-l
B-l
0
3
0
0
K.
K.
M.
K.
1,369.88
14,315.00
787.50
36.00
1286-A
B-l
0
K.
G.
1,238.60
62.93
do
do
do . . . .
do
. . do . . .
do
do .
do
do . . . .
Apr. 6,1929
Dec. 7,1928
do
do . . .
do......
628-A
631-A
631-B
632-C
632-A
634
314
643
661-A
661-B
1294
657-A
665
667-A
B-l
B-l
B-l
B-l
B-l
Award
B-l
B-l
B-l
B-l
B-l
B-l
B-l
. B-l
SH
3
0
0
0
5
3H
4
5
5
0
0
0
0
K.
121.34
K.
1,570.09
K.
1,512. 50
G. G. 280.00
G.
74.92
$
102.90
K.
26,361.37
K.
5,528.39
$
2,843.69
$
2,581.00
K.
577.50
K.
1,375.00
K.
1,787. 50
K.
82.50
do
. . . . do
.....do
do
673-A
1304-B
1304-A
676-B
B-l
B-l
B-l
B-l
0
0
0
23^
K.
1,104.47
M.
192.00
G. G.
80.00
K.
368.50
do
do
.....do
do
do
do
do
do
804
701
1312-C
_ 711-A
1138-B
237
238
1321-C
B-l
B-2
B-2
B-l
B-l
B-l
B-l
B-l
0
0
0
0
3
BH
3%
0
K.
68.49
G. G. 300. 00
K.
222.61
K.
220.00
K.
137.05
K.
42,125.17
K.
2,018.04
K.
222.61
569-A
B-l
0
G..
669-B
1323-C
B-l
B-l
0
0
F.
19.50
G. G. 2,400.00
.
—
do
do . . . .
do
92. 60
345
SECEETAEY OF T H E TBEASUEY
the Secretary of the Treasury by the Commissioner of the Tripartite Claims Comthe settlement of war claims act of 1928—Continued
AWARDS
Interest payable
To-
From-
Amount
PAID—Continued
DeducT o t a l i n tion of
|one-half|
United
Net
Total due
Conver- States
ofi
a n d p a y a b l e sion r a t e
|per cent I a m o u n t
curp
a
yable
as rerency
quired
b y act
G.
F.
149.83
23.971
.12
.12
D a t e paid
$17.98
2. "
20.86
$0.10
$20.76 D e c . 24,192a
K.
410.96| .06
24.66
K.
412.50 .06
24.75
Various
D e c . 7,1928 K .
571.60 .06
104. lOl K .
34.30|
do...
K . 5,687.30 K . 18,361.87 .06
1,101.71
D e c . 31,1917
£
5.625 i.92
22.05|
D e c . 7,1928 K . 26,392.93 K . 85,990.73 .06
Various6,169.44
K.
137.60 . 0046951
.63
K.
137.50 .0046961
.63
K.
328.00 .06
19. 68
24.54 F e b .
.12
.12
24.63 F e b .
.17
34.13
5.6l| 1,096. 20 D e c .
.11
21.94 D e c .
26.80| 6,133.64 D e c .
.00
.63 M a y
.63
.10
19. 68 D e c .
18,1929
13,1929
Do.
24,192831,1928
24,1928
6,1929
Do.
24,1928
3,162.63
923. 60 K .
189. 76
1,175.83 K. 4, 738. 951 .007007
33.21
K. 11,660.001 .06
699. 601
K . 1,070. 22 .06
64. 21
$
1,192. 37
1,192. 37
.951 188.81 F e b .
.17
33. 041J a n .
3.601
696.10 J a n .
.32
63.89 D e c .
6.96 1,186. 41 J a n .
13,1929
23,19299,1929
24,1928
30,1929
Dec.
Nov.
7,1917 D e c . 7,1928
do......
do...
.1,1917 J a n .
Various .
Dec.
Dec.
7,1917 D e c .
30,1929
K.
302.97 K.
K.
K.
9,600.00
1,677. 97
1,376. 00
1, 027. 60
.06
.06
.06
.06
676. 00
100. 68
82. 50
61. 66
K . 1,369,
7,1928 K . 4,723.95 K . 19,038.951 .06
M.
787.50 .10
K.
36.00 .06
82.19
, 142.34
78.76
2.16
7,1928 K .
K.
G.
1,238.60
62.93
.06
.12
.41
.63^
.45
.68)
.04
.86
11.17
2.39
22.04
20. 211
.171
.411
.54
.02
.06
.10
.48237
.06
66.
19.
38.
27.
.33
.10
.19
.14
.06
. 48237
.06
.06
.06
.06
.06
.06
4.11
144. 71
13. 36
13. 20
10. 67|
3, 670.11
171. 031
13.36l
K. 1,104.47
M.
192.00
G. G. 80. 00
459.34
90.84 K .
Various..
Dec.
7,1928
K.
68.49
G. G. 300.00
K.
222.61
K.
220. OOl
D e c . 31,1918 D e c . 7,1928 K .
177.90
40.85 K .
K . 17,376.
Dec.
7,1917| . . . d o . . .
K . 59,601.80
...do...
K.
832.44| K . 2,850.48
.....do
K.
222.61
G,
92. 50
74.32
7.55
.O5I
.06
.06
.06
.06
.06
.06
.12
F.
19.601 .12
G . G . 2,400.001 .48237
573.12 F e b . 4,1929
100.18 J a n .
9,1929'
82.09
Do.
61. 34 J a n . 14,1929
.41
81. 78 F e b . 4,1929
5.71 1,136. 63 J a n . 16,1929
78.36 D e c . 24,1928
2.15 F e b . 27.1929-
10. 27
126.11
90. 76
136. 06
8.99
172.89
2, 234.13
477. 66
4,407. 72
4, 042.98
34.66
82. 60
107. 25
4.95
.06
.06
.06
. 48237
.12
31,1917 D e c . 7,1928 K.
do
K.
do
.41
.31
8L 87
171.09
49. 76 K.
615. 04 K . 2, 086.13
K . 1, 512. 60
G . G . 280.00
74. 92]
G.
172.
M a y 26,1915 D e c . 31,1928
$
Dec.
7,19171 D e c . 7,1928| K. 10,874.07 K. 37, 235.441
do...
do.... '
K. 2,432.49 K . 7, 960.88
..do...
do.-..
$
1, 664. 03 $
4, 407. 72
A p r . 6,1929| $
1,46L" $
do....
4, 042. 98
577.-60
375. 00
787. 50
82. 50
Dec.
.601
27
20
59
66
11.10
2.34
1,157.69l
Do.
81.46
10.
124.
90.
134.
8.
172.
2, 222.
475.
4,385.
4,022.
34.
•82.
106.
4.
M a y 20,1929
D e c . 31,1928
Do.
Jan.
23,1929-
Do.
D e c . 31,1928
D e c . 24.1928
Do.
Do.
Apr.
Jan.
Feb.
Jan.
24.1929
14,1929'
11,1929
14,1929
Do.
66.94, F e b . 25,1929
19.10 IJan. 16,1929
38. 40
Do.
27.42 F e b . 4,1929
.02
4.09 F e b . 13,1929
.72
143. 99 F e b . 4,1929
.07
13. 29 J a n . 28,1929
.071
13.13 M a y 13,1929
.05
10. 62 J a n . 14,1929
9,1929
17.85 3, 662. 26 J a n .
.86
Do.
170.17
.07
13. 29 J a n . 28,1929
.06
11. 04 I J a n .
14,1929
.01
2.33
Do.
6.79I 1,161.90lIJan.
9,1920
346
REPORT ON TPIE FINANCES
IL—Awards and interlocutory judgrrients against Austria certified for payment to
mission pursuant to the provisions of
AWARDS PAID—Continued
Claimant on behalf of whom judgment is
entered
Date
certified
Docket No.
Class
of
judgment
315
Loeffler. Mathilde Popp.
Dec. 7, 1928
B-2
Do.....
....
316
do...
B-2
Mackintosh, James F
do...
737-B
B-l
Do
737-A
do...
B-l
Mallouk & Co., H., Habib Mallouk trading
B-l
6
.do.,
under firm name and .style of
741
.do.,
Mandell, Solomon Budd.
B-l
1141-A
.do-.
Marx, Morris
B-l
1141-B
-do.,
Do
B-l
761-B
.do.,
Maurin, Frederick J
B-l
. 735
.do.,
McNeil, Murray Thornton
B-l
757
.do.,
Menzel, Robert
B-2
1145-E
.do.,
Michels, Edward H
B-l
1145-A
.do..
Do.....
B-l
r766-A, B,
.do..
Milbank, Robert W
B-l
I C, D, E. }
Milbank, Montgomery N., executor under
f766-A, B,
last will and testament of Charles B. Mil.do...
B-X
\ C, D, E. }
bank, deceased..
Miller, Margaret, executrix of estate of WilB-l
1340-C
.do.,
liam D. Miller, deceased
771-A
.do.,
Milwaukee-Western State Bank
B-l
.do-,
783-A
Muller, Henry J
B-l
.do.,
1347-B
Musil, Frank J
B-l
.do.,
1347-A
Do
B-l
.do.,
786-A
Musil, Louis A
B-l
.do.,
786-B
Do...
B-l
.do.,
786-C
Do..
B-l
.do.,
308 Award
Mutual Life Insurance Co. of New York, The.
.do.,
1352
Nelson, August..
B-l
.do.,
794-A
Netter, Edwin
B-l
.do.,
794-D
Do..
B-l
.do..
1147
Neugass, Henry
B-l
Neumark, Dora, on behalf of her minor son,
795-C
B-l
Emanuel K. Neumark...
.do.,
766-A, B,
.do..
Newbery, Beverley R
B-2
C, D, E,
B-l
796
.do.,
New York Life Insm-ance Co..
798-A
.do.,
Novak, John...
B-2
798-B
.do.,
Do..
B-2
1150-A
.do.,
Novakovic, Ida S
B-2
1150-B
.do.,
Do....
B-2
.do.,
1150-C
Do
:
B-2
.do.,
802
Oberscribnig, August.
B-l
.do.,
803-A
Oedl, John
B-l
-do.,
803-B
Do
B-l
.do.,
805-G
Oestreicher, Emanuel
B-l
.do.,
806-A
Do
B-l
.do.,
806-B, C, D
Do
B-l
.do.,
807-A
Ohnstein, Harry
B-l
.do.,
807-B
Do
.
B-l
.do.:
1151
Oppenheimer, Flora
B-l
.do..
481
Orr, Hermine
B-l
Parke, Davis & Co..
.do..
Payne, Herbert
Pennsylvania Bank & Trust Co. of WilkesBarre (successor to the Slavonic Deposit
Bank)
Petersen, MatildeE., trustee for Louise Caroline Petersen
.do..
.do.,
.do..
Rate
of
mterest
P.ct.
3H
3
2
0
3H
0
0
0
0
0
0
0
0
5
Principal
K.
K.
K.
K.
K.
7, 26.0. 04
K
260. 00
F.
3.00
F. fcs.
60.00
9.00
K.
1,294. 40
385. 00
K.
M.
400. 00
G.G.
360. 00
£
143.00416
6
0
0
0
0
3M
3H
0
3
5
0
0
2
0
2,123. 00
2, 084.49
137.50
137. 50
36.75
10,000. 00
605.00
3, 327. 50
1, 375. 00
6, 308. 65
7,298. 78
1,100. 00
1, 725. 00
100,000. 00
G. G.
240. 00
K.
137.60
K.
G.
SH K.
5 £
110.00
377.57
288. 03
42.90
0
0
0
0
0
0
4
4
4
2
0
0
0
0
0
0
K. 94,285. 79
605. 00
K.
1,815. 00
K.
71.35
K.
K.
1,680. 00
K.
400. 00
K. 10,850. 00
K.
1,438.
K.
31.46
K.
825. 00
K.
220. 00
K.
687. 50
K.
23.10
K.
360. 00
G. G. 2, 200. 00
K.
247.50
B-l
6
K.
£
Award
5
824
B-l
2
832-A
B-2
0
817 A, B, C,
D, E, F
201. 60
18. 0833
1,908.00
166. 33
G.
F. fcs.
60.00
30.00
347
SECEETAEY OP THE TEEASUEY
.the Secretary of the Treasury by the Commissioner of the Tripartite Claims Com.the settlement of war claims act of 1928—Continued.
AWARDS
Interest payable
From-
Amount
Dec.
7,191' D e c . 7,1928 K .
do
.....do...
K.
Various
do...
K.
Dec.
7,1917 D e c .
Dec.
..do
D e c . 7, 1917 D e c . 7,1928 K.
Various. _
..do...
' K.
10, 000. 00
606. 00
3, 327. 60
1, 375. 00
8, 737. 48
10,313.72
1,100. oo|
2,135.61,
140, 013. 70
G. 240. 00
137. 50
133. 70
2,428.83
3,014.94
Various..
Dec.
7,1928
23. 70
7,1917 D e c .
7,1928i
do...
118. 81
23. 595|
.06
.06
.12
.12
. 013775
.10
.48237
7,19171 D e c . 7,19281
do...
'
.-do-_
.06
.06
.06
.06
.06
.06
.06
.06
,
. 48237
.06
.06
377. 571 .12
406. 841 .06
66. 495 5.82M
110. 88 K .
9.96 £
603. 31
15. 60|
.36
7.20|
.64
1, 294.401
5.30
40. 00
173. 651
263.76
K . 94, 285. 79 .06
K.
605. 00 . 006750
K . 1, 815. 00 . 006750
K.
71. 35 .06
K . 1, 680. 00 .06
400. 00| .06
K.
D e c . 26,1917 D e c . 7,19281 K . 4,751.47 K . 15, 601. 47 .06
Dec.
7,1917| . - . . d o _ _
K.
632.76| K . 2, 070. 84 .06
Various
K.
K.
39
.:..do-70. 721 .06
do
009. 53 .06
K.
184.53 K .
-—do
K.
220. 00 .06
687. 50 .06
K.
K.
23.10 .06
K.
360. 00 .06
G . G . 2,,200. 00 .48237
247.50 .06
K.
Dec.
$7.17
6.76
10. 07
8.26|
1, 055. os!
66. 4126
19. 6625
7,1928| K.
410.61
2,1929 $ 40,013.701
do
DoUar
2, 940. 36l0.
@FedFRASER