The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
- 3 -
consultation with the Secretary as to the date of issue, maximwn
interest rates, and other terms and conditions.
In addition to the provision for optional purchases of
Postal Service obligations by the Secretary, new section 1006
would permit the Service at its discretion to sell to the
Treasury Postal Service obligations up to $2 billion.
New
section 1007 would authorize the Secretary to use the proceeds
from the sale of public debt securities to purchase Postal
Service obligations.
We believe that these financing provisions are appropriate
for the proposed postal establishment, and are mindful of the
fact that similar provisions could well be adapted to other
business-like activities of the Government.
These provisions are consistent with the intent that the
debt obligations of the Postal Service meet the test of the
market.
The language prescribing the minimum rate of interest
on Treasury purchases of Postal Service obligations is designed
to preclude indirect subsidies by assuring that any borrowings
from the Treasury will be at rates not less than the current
estimated cost of money to the Government .. The Secretary's
right of first refusal to purchase Postal Service obligations
will provide the Secretary the opportunity to coordinate Postal
Service borrmvings \vith the financing of other Government activities
without interfering with the financing of essential Postal Service
/
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 1, 1969 -
~
L'
:..{
fh.i~h" .;..,JO
TREASURY GENERAL COUNSEL
DECLINES PATMAN INVITATION
0CT 2 J 1~6g
rJ'.BaSURI DEeAr:'!~~Errn
The following letter from Paul W. Eggers, General Counsel of
the U.S. Treasury, has been delivered to Wright Patman, Chairman
of the House Banking and Currency Committee:
"Dear Mr. Chairman:
"Thank you for your letter of April 30, 1969,
in which you invite me to appear before your Committee
on May 3. It appears that you wish me to testify
concerning the financial affairs of Secretary Kennedy.
"I must respectfully decline to appear before your
Committee for this purpose. Secretary Kennedy's
personal finances are irrelevant to H.R. 6778. At
the beginning of the hearings on H.R. 6778 you made
statements concerning Secretary Kennedy which were
erroneous as to the facts alleged and as to the conc lus ions drawn. i\Iy statement was for the purpose of
insuring that the Record accurately reflects the
facts. Because the allegations made by you will
appear in the Record of the hearings on H.R. 6778
it is reasonable, as your letter states, to request
that an accurate statement of the facts be placerl in
that Record. Such a statement has been furnished you
for that purpose. There is nothing I can add to that
statement.
Sincerely yours,
(Signe~ Paul W. Eggers
Paul W. Eggers"
The Honorable
Wright Patman, Chairman
Banking and Currency Committee
House of Representatives
Washington, D. C. 20515
000
TREASURY DEPART:--IENT
Washin;ton
FOR A.M. RELEASE
TUESDAY, MAY 6, 1969
I~EMARKS
OF THE HONORABLE CHARLS E. WALKER
UNDER SECRETARY OF THE TREASURY
BEFORE THE
TEXAS BANKERS ASSOCIATION, 85TH ANNUAL CONVENTION
HOUSTON, TEXAS, MONDAY, ~AY 5, 1969, 8 P.M., C.D.S.
I want to talk tonight about two high priority items
which have been consuming a significant amount of effort during
the early months of the Nixon Administration -- the pursuit of
peace and the control of inflation.
As the President said in his April 14 Message to Congress,
"Peace has been the first priority" of the Administration.
Without peace, he went on, we will not be able to fulfill
our domestic needs. What we are able to do at home will depend
in large measure on the prospects for an early end to the war
in Vietnam.
The Administration, recognizing there are no easy
solutions to the myriad problems we face around the world,
is committed to the pursuit of peace with justice. But
peace is not achieved simply by wishing for it, but by working
for it -- relentlessly, vigorously, with determination and
with good judgment.
In the world, as it is, military strength is needed to
make a nation's diplomacy work, to make it credible. This is
especially true of the United States, a nation that, because
of its unparalleled strength, bears tremendous leadership
responsibilities.
The decision to proceed with an anti-ballistic missile
system, the "ABM," was evidence of the President's determination
that no American president -- neither ~r. Nixon nor his
successor -- should ever be put in a position of having to
negotiate with a potential adversary from a position of military
inferiorityo At the same time, a decision to shift to the
Safeguard system showed a strong determination to bring the
arms race under control.
K-78
- 2 The debate over deploying a limited ABM system has
generated an inordinate amount of verbiage, pro and con.
I
believe the view of Representative Emanuel Celler, liberal
Democratic dean of the House, should be read carefully, for it
represents a prudent view from Capitol Hill. Some have said
his is the majority view of the House.
In discussing the ABM system, Mr. Celler asks not "What
if the opponents are right?" but, "What if they are wrong?"
He answers his own question in the following words:
"If-the opponents are right, we have spent
$800 million; but if they are wrong, we, in
our turn, have wronged untold millions of lives.
Certainly, there are unprovable assumptions on
both sides; estimates that cancel out each other,
demonstrable facts upholding each end of the
argument.
But the disparity in possible
consequences leads me inexorably to conclude in
favor of the Safeguard system, the modified
anti-ballistic-missile program. The gamble is
too great, the awesome risk too much to bear."
Next year Safeguard will cost between $800 and $900
million-- about one-half of the projected cost of the
Sentinel system.
Over the·next four years, Safeguard could
cost between six and seven billion dollars if completed.
As has been emphasized, it may not be necessary to complete
the system.
There is still another related revenue question: What
does the initial money buy? More than half of the first
year's budget will go to research and development. Most of
the remainder will go to start the construction of the
defense of two Minuteman sites, part of our deterrent system.
These Safeguard costs will not reduce our determination
to meet domestic needs
We can do both. Our gross national
product, now in excess of $900 billion, permits us to meet
our domestic goals while also initiating the Safeguard system.
v
- 3 -
)
)
All things considered, it seems to me that Mr. Celler's
remarks best sum up the issue:
If they (the opponents) are
right, he argues, the Treasury will be out $800 million, but
if they are wrong, the cost may run to untold millions of lives"
"The gamble is too great; the awesome risk too much."
This Administration, as I indicated earlier, is also
every effort to eliminate another risk -- the
risk that inflation poses for our economy_
~xerting
Why is this Administration determined to stop
inflation?
What have we done to achieve this goal?
What are the prospects for bringing inflation
to a halt?
Inflation is primarily an economic problem, although its
repercussions spread beyond economics. Some highlights of
economic damage from inflation are:
over the past four years, the purchasing power
of your dollars have declined sharply as
consumer prices rose by about 15 percent;
the economic overheating that causes inflation
contributed to the elimination of our trade
surplus in 1968 and thus removed one of the
strongest plus factors in our international
payments position;
excess demand, rapidly rising prices, and
expectations of further increases have pushed
interest rates to the highest levels in a
hundred years;
the distortions and imbalances that result from
overheating threaten ultimately to end the boom
and tip the economy into recession.
It is this last danger that broadens this Administration's
concern about inflation, for we know that in the last analysis
the achievement of all of our major national goals -whether of national security or in dealing with the problems
of the cities, rural America, the poor and the disadvantaged
depend upon che maintenance of a strong, healthy, and growing
economy.
This means a balanced and noninflationary economy.
- 4 The ultimate result of inflation at the recent rate is
alMost certain to be a weakening of our economy and impairment
of our ability to deal with pressing national problems
What steps has this Administration taken to stop inflatio:1?
We have d~alt not with symptoms but with fundamentals.
Let me enumerate:
the two intensive bud:.;et reviews ordered by the
President resuked in cutbacks in every Federal
department except Justice, where extra funds
are needed to carry out the fight against crime;
the President has requested a full-year extension
of the income tax surcharge, with a cutback to
five percent next January 1. This reduction would
be off-set by permanent repeal of the seven percent
investment tax credit;
Federal Reserve authorities have contained the
rate of monetary growth by limiting the volume
of reserves available to banks and by raising
the discount rate.
Wi'll these policies work? What are the prospects for
bringing inflation to a halt, and how soon?
These policies will work. \.)'...it Vole must be patient. To
force early and sharp anti-inflationary effects would risk a
s:ll_ft in th·.: econo!.1Y which might tip us into the very
recession our gradual policies are aimed at avoiding.
But do not underestimate the degree of restraint that
now exists. We believe that it is sufficient to cool the
economy and gradually slow inflation and diminish inflationary
cxpectatLJns, :;ut not so severely as to result in economic
overkill.
If this is true, why have we not yet seen any convincing
signs of a levelling off?
{/
- 5 -
!
Partly because of the gradualness of the policy itself;
partly because inflationary forces and expectations have in
the past four years become deeply ingrained in the economy.
Expectations of further inflation are especially troublesome;
they distort business and personal decision-making processes
and create a built-in force for further inflation.
The battle against inflation cannot be won until these
inflationary expectations begin to subside o My personal view
is that they are diminishing. If so, visible signs of
success in the battle against inflation will emerge before
long.
This does not mean that the escalation of prices will
shortly come to a halt. The wage-price spiral, itself partly
a result of inflationary expectations, will not end overnight.
It will come gradually under control as restrictive fiscal
and monetary pressures relieve basic inflationary pressures.
Prices cannot long continue to rise in the face of a
determined policy of economic restraint. We expect to see a
measurable reduction in the rate of price increase before the
end of this year.
Questions have been raised about the impact of the
Administration's anti-inflationary program on employment
will the economic cooling which we are seeking push unemployment
to unacceptable levels? Technical analyses of this matter,
although not conclusive, are reassuring. But what is important
to understand is that continuation of inflation at the present
rate offers no solution to the problem. Sooner or later,
the distortions and imbalances bred by inflation lead to
disruptive reactions and adjustments. If this is allowed to
happen, growth might stop instead of only slowing, and
unemployment might shoot up to an intolerably high level.
Stated differently, this Administration's policy of first
slowing and then stopping inflation, through firm but gradual
measures, is the best assurance possible that workers will
continue to enjoy maximum employment opportunities.
- 6 To summarize the answers to the three questions I posed
concerning our efforts to stop inflation:
This Administration is determined to stop
inflation because its continuation will undermine our efforts to achieve not only our
economic goals but other vital national goals as
well.
Our efforts include several firm but gradual
steps to cool the economy through restrictive
fiscal and monetary policies.
The prospects for slowing and ultimately halting
inflation are good -- only patience is needed;
ultimately the restrictive policies will have their
effects.
Neither peace nor economic stability can be achieved by
wishful thinking -- to l~t inflation continue at the present
rate risks severe costs [or the economy and our people; to
fail to maintain adequate defenses carries grave risks both
for our people and our friends abroad.
Nor can peace and economic stability be achieved overnight.
Nevertheless, under the leadership of a new President and a
new Administration, a significant start has been made in dealing
with both of these problems. The policies adopted have been
carefully argued, the President has considered all points of
view, and he has made his decisions on the basis of what he
believes to be best for the American people, now and in the
docades ahead.
These policies, for peace abroad and stability at home,
deserve your support.
000
TREASURY DEPARTMENT
WASHINGTON, D.C.
May 2, 1969
FOR IMMEDIATE RELEASE
NOTICE TO THE PRESS:
Sir Leslie O'Brien, Governor of the Bank of
England, will have an introductory meeting with
Treasury Secretary David M. Kennedy at Treasury at
3:00 P.M., Tuesday, May 6, the Treasury Department
and the British Embassy jointly announced today.
Sir Leslie, who will arrive in
Wash~ngton
Sunday afternoon on a routine visit to the
United States, will visit Mr. Kennedy in
accordance with long-standing plans to meet
members of the new Administration.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 5, 1969
FOR IMMEDIATE RELEASE
TREASURY ANNOUNCES COUNTERVAILING DUTY
ORDER ON STEEL PRODUCTS FROM ITALY
The Treasury Department announced today that it has
sent to the Federal Register for publication on May 6
notification of countervailing duties to be imposed on
importations of some basic steel products from Italy.
The countervailing duty action resulted from an
investigatiJn by the Bureau of Customs of a complaint made
by United States Steel Corporation, Pittsburgh, Pa.
It
complained that certain steel products from Italy were
being subsidized by the government.
The countervailing duties will become effective
June 14, 30 days after publication in the Customs Bulletin.
The Treasury said the countervailing duties are
intended to counteract subsidies by Italy ranging from
about $10 to $24 per metric ton on exports of these products
to the United States.
The products include such items as
pipe, cables, staples, nails, rivets, bolts and nuts.
Countervailing duties will be assessed only on shipments
receiving benefits from the subsidy program. The amount will
be equal to the amount of the subsidy.
000
K-79
TREASURY DEPARTMENT
WASHINGTON, D.C.
)R RELEASE 6: 30 P.M.,
)nday, Mal 5, 1969.
RESUL'fB OF TREASURY'S WEEKLY BILL OFFERING
Tbe Treasury Department announced that the tenders for two series of Treasury
Llls, one series to be an additional issue of the bills dated February 6, 1969, and the
~r series to be dated Mal 8, 1969, which were otfered on April 30, 1969, were
~ned at the Federal Reserve Banks toda.y.
1enders were invited for $1,700,000,000,
r thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 182-day
Llls. 'Dle details ot the two series are as follows:
UfGE OF ACCEPTED
)MFETI'l'IVE BIm:
91-day Treasury bills
maturing August 7, 1969
Approx. Equiv.
Price
Annual Rate
High
98.498
Low
Average
98.478
98.489
!I
182-day Treasury bills
maturing November 6, 1969
Approx. Equiv •
Price
Annual Rate
6.03]$
96.951
96.922
6.08a;,
96.935
6.063~ 1.1
5.942*
6.021~
5.97a;,
!I
!:I. Excepting
one tender of $783,000
9~ of the amount ot 91-day bills bid for at the low price was accepted
35~ ot the amount ot 182-day bills bid tor at the low price was accepted
OTAL mUERS APPLIED FOR AND ACCEP'lED BY FEDERAL RESERVE DIS'mICTS:
District
Boston
New York
Philadelphia
Cleveland
Ricbmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
iQTAI.B
Applied For
Acce~ted
$ 28,436,000 $8,436,000
1,171,466,000
1,919,971,000
20,879,000
35,879,000
37,749,000
37,749,000
23,542,000
23,542,000
38,124,000
4:7,124,000
154,916,000 :
185,021,000
43,015,000
50,015,000
27,406,000
27,466,000
30,843,000
30,843,000
19,441,000
28,4:41,000
114:
1490222402000
z184 z 000
A~121ied
For
3,470,000
1,762,617,000
18,216,000
25,514:,000
8,979,000
29,551,000
173,429,000
31,704,000
25,606,000
12,990,000
21,581,000
141 z 217 z000
$
$2,563,711,000 $1,700,001,000 ~ $2,254,874,000
Acce12ted
3,470,000
$
965,617,000
8,216,000
25,514,000
7,4:79,000
17,691,000
133,229,000
22,854,000
20,656,000
12,990,000
13,331,000
69 z117 z000
$1,300,164,000 ~
I Includes $327,657,000 nonccapetitive tenders accepted at the a-.erage price ot 98."89
I Includes $144:,963,000 noncompetitive tenders accepted at the average price ot 96.935
I '1'bese rates are on a bank discount basis. !be equivalent coupon issue yields are
6.15~ tar the 91-4&7 bills, and 6.34~ tor the 182-dal bills.
CORRECTED COPy
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 6, 1969
FOR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY CALLS MEETING
OF THE JOINT COMMISSION ON THE COINAGE
Secretary of the Treasury David M. Kennedy has called
a meeting of the Joint Commission on the Coinage for Monday,
May 12, at 9:30 a.m., in the Treasury Building, Washington, D. C.
to discuss silver and coinage policies.
The Joint Commission on the Coinage, created by the
Coinage Act of 1965, consists of 24 members, including 12
from the Congress, four from the Executive Branch, and eight
public members.
Secretary Kennedy is Chairman.
The members are: David M. Kennedy, Secretary of the
Treasury; Maurice H. Stans, Secretary of Commerce; Robert Mayo,
Director, Bureau of the Budget; Eva Adams, Director, Bureau of
the Mint, and Senators John Sparkman, Wallace F. Bennett,
John O. Pastore, Alan Bible, George Murphy, Peter H. Dominick,
and Congressmen Wright Patman, William B. Widnall, Ed Edmondson,
Robert N. Giaimo, and Silvio O. Conte.
Public members are Julian B. Baird, St. Paul, Minnesota;
Amon Carter, Jr., Fort Worth, Texas; William C. Decker,
New York, New York; Samuel M. Fleming, Nashville, Tennessee;
Edward H. Foley, Washington, D. C.; Harry F. Harrington,
St. Louis, Missouri; Eugene S. Pulliam, Indianapolis, Indiana,
and Harry E. Rainbolt, Norman, Oklahoma.
A vacancy created by the resignation of Congressman
James F. Battin to accept a judgeship has not been filled.
000
K- 80
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 6, 1969
FOR IMMEDIATE RELEASE
RICHARD M. NTXON PRFS1DrN-lli\J,
NOW ON SALE AT THF. ~1TNT
~1U)i\J.
The Richard M. NixLln Medal has been added to the
Presidential Series of medals available for purchase
from the Bureau of the Mint, the Treasury announced
today.
Thl' Nixon Presidential tvkd:tl mdY he punhilsl'u
from the Superintendent, United States Mint, Philadelphi~.
PcnnsylvJnia 19130.
The cost is $3.00, including postage.
Thl' medal is of Mint hronze, and is three inches in
rii:lmeter.
Delivery time will be <1pp1"(n:im~llely one week
The front ·)f the medn. 1 (t lilt ~ i n ~ t pro fi J e port.rn it
of the Pn~siciLnt, looking to lile Vil'\,.er's right.
Ab(lvt
and around the border is the inScl-iption, "President of
the United States," and to the left ()f the hust,
"Richard Milhnus Nixon."
Thf' reverse side has an adaptation of t he Seal l l f t h.,
President of the United States within a wreath of 50 stnrs.
Below the seal is the inscription: "Inaugurated January 2C,
1969 - - (l new day for Amer ica - - A ne\v d;'lwn for peace Clnd
freedom in th E.' worl d - - Richard M. Nixon." Th e statemen t i s
from his August, 1968, speech accepting the nomination [Ul
President.
Both front and reverse designs were executed by
Frank Gasparro, Chief Engraver of the Mint.
K- 81
- 2 Included in the Presidential Medal Series are
medals for all former Presidents of the United States.
Individual medals or the entire series may be
purchased from the Philadelphia Mint.
Production of commemorative medals honoring the
Presidents, Army and Navy heroes and outstanding citizens,
and memorializing events of national importance, llas
been carried on at the Philadelphia Mint for more than
150 years.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 7, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by
for two series of Treasury bills
$3,000,000,000, or thereabouts,
Treasury bills maturing May 15,
$ 2,998,828,000,
as follows:
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
1969,
in the amount of
9l-day bills (to maturity date) to be issued May 15, 1969,
in the amount of $1,700,000,000,
or thereabouts, representing an
additional amount of bills dated February 13, 1969,
and to
mature August 14, 1969,
originally issued in the amount of
$1,100,498,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $1,300,000,000,
or thereabouts, to be
dated May 15, 1969,
and to mature November 13, 1969.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Monday, May 12, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec·ima1s, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
- 2 responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announCE
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Secretary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on May 15, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing May 15, 19690
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
It
TREASURY DEPARTMENT
WASHINGTON, D.C.
May 6, 1969
FOR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY AND SIR LESLIE O'BRIEN,
GOVERNOR OF THE BANK OF ENGLAND,
MEET TO DISCUSS MUTUAL INTERESTS
Secretary of the Treasury David M. Kennedy and Sir Leslie
O'Brien, Governor of the Bank of England, met today at Treasury.
Sir Leslie is on a routine visit to the United States
planned some time ago, and is taking the opportunity to
meet members of the new Administration.
This was the first time that Mr Kennedy and Sir Leslie
had met since the appointment of Mr. Kennedy as Treasury Secretary.
They used the occasion to discuss economic and financial
developments within their two countries, and particularly
reviewed the progress each nation is making in curbing
inflation and overcoming balance of payments deficits.
000
TREASURY DEPARTMENT
1/
WASHINGTON, D.C.
May 7, 1969
FOR IMMEDIATE RELEASE
TREASURY GENERAL COUNSEL PAUL W. EGGERS DESIGNATED
TREASURY'S DIRECTOR OF EQUAL EMPLOYMENT OPPORTUNITY
Treasury Secretary David M. Kennedy designated
General Counsel Paul W. Eggers as Treasury's Director of
Equal Employment Opportunity.
Mr. Eggers, the fourth ranking official of the
Department, will spearhead a concerted effort throughout
the Department to achieve equality of opportunity for job
applicants and employees regardless of their race, color,
religion, national origin or sex.
The assignment carries with it responsibility of
insuring that contractors doing business with the Treasury
Department and banks holding deposits of Federal funds
comply with Treasury's equal employment policies and
regulations. In assuming these duties, Mr. Eggers made it
clear that he intended to pursue an innovative program aimed
at creating in Treasury a working climate that reflects
welcome and fairness to all citizens.
000
K-83
TREASURY DEPARTMENT
Washington
Iv
FOR RELEASE AT NOON
WEDNESDAY, MAY 7, 1969
REMARKS BY THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
AT THE DEPARTMENT OF DEFENSE KICK-OFF RALLY
WASHINGTON, D.C.
WEDNESDAY, MAY 7, 1969, 12 NOON
The name of this Department of our Government is synonymous
with security -- for the nation, for the family, for the
individual. To defend is to protect -- to safeguard -- support -to sustain.
There is another name with a built-in protective meaning
the payroll Savings Program. While this is a long-standing
program, it has acquired a new pertinence.
Our president and Commander-in-Chief has made it perfectly
clear to all of us, and I quote, that:
"A sound dollar is vital to the
American free enterprise system. It is
one of the pillars of our prosperity and
national strength. In these critical
and uncertain times, the defense of the
dollar ranks among the highest of
national priorities."
To the president's remarks, let me add something I cannot
say too often: This Administration is firmly committed to
ending inflation. You here in the Defense Department
know of the patience, hard work, and ingenuity necessary to
provide for the military security of the nation. You know from
your own knowledge and experience the importance of the
Safeguard Anti-ballistic missile system and the key role this
Administration feels Safeguard will play in protecting our
country from missile attack.
K-84
- 2 -
I suspect you also know -- from your visits to the
grocery store and the department store -- what inflation could
do to our economy. The Administration is committed,not only
to ending inflation, but to doing so in an orderly way. We
are cutting expenditures, we are increasing efficiency to cut
down on waste, and we are pursuing a tight money policy to
restrict excessive corporate and personal spending. That is
why the Administration has asked the Congress to extend the
10 percent surcharge on income taxes until January 1, after
which time it would be reduced to 5 percent, and that is why
the Administration has recommended the abolishment of the
7 percent investment tax credit allowed business for machinery
and equipment.
While we can already see some early results from these
anti-inflationary policies -- a drop in new factory orders
and in manufacturer's shipments in March -- the government
needs assistance from all of its citizens, and especially
from its own employees.
That calls for a larger volume of private voluntary
savings -- and I underscore the word, "voluntary."
As members of the Federal Family, you are all one with
us, in achieving our 1969 campaign goals. Let me tell you
what we ask of you:
We want to sign up at least 80 percent of
all employees in each Defense Agency.
We hope to encourage present Bond buyers
to purchase higher denomination Bonds.
Most important, we seek to establish a
strong sustaining program, so that employee
participation will not diminish between
yearly campaigns.
NOW, as you well know, the purchase of Savings Bonds and
Freedom Shares is a voluntary action. But the act of purchasing
bonds goes far beyond purely personal interests -- it is in
our national interest.
To help safeguard our economic stability, it is desirable
that the bulk of the Federal debt be placed in the hands of
long-term savers.
- 3 -
The best way to increase the amount of the debt in the
hands of real savers is through the sale of Savings Bonds and
Freedom Shares to those persons who buy them from money saved
out of current earnings.
The widespread payroll participation by you and your
fellow employees -- and, in fact, by Americans everywhere, in
every walk of life - ... is 'ample testimony to the continuing
worth of U.S. Savings Bonds in personal as well as Federal
financial planning.
Such personal participation, which is unmatched by the
citizens of any other nation, reflects the great confidence
of the people in the integrity of our currency and in our
financial policies.
It is unique testimony to our national solidarity and
strength.
Perhaps many of you are not aware of the impressive
record of participation in the Savings Bonds program
achieved in the Department of Defense. Let me cite a few
figures:
Last year, total Federal purchases amounted
to more than one billion, seventy-five million
dollars. The Defense Establishment accounted
for more than half of that amount, or six
hundred, ninety-million dollars. Members of
the Armed Forces bought more than three
hundred, forty-six million dollars, while
civilian employees of the Department bought
more than three hundred, forty-three million
dollars.
In 1968, more than three million, six hundred
forty-one thousand Federal employees were
enrolled in the Payroll Savings plan. The
Defense Department accounted for more than
two million, five hundred ninety-five
thousand: more than one million, eight
hundred forty-two thousand Servicemen;
more than seven hundred, fifty-two thousand
civilian employees.
The 1968 tally shows more than 71 percent of
Department employees -- both civilian and
Servicemen -- enrolled for Payroll Savings.
- 4 I am sure you are aware that at the request of the
president the Treasury is prepar~ng a study of the interest
rates the Government pays on its debt obligations. The 4-1/4
percent return that E Bonds pay offe~ sound protection
for home and family and an opportunity for individual
citizens to contribute to a sound dollar. At the same time,
we believe strongly that E Bonds should be fully competitive
with similar savings instruments. We will ask Congress to
review the current interest rate ceiling at an early date.
It has been a personal pleasure to be with you. Let us
move forward together to defend the dollar -- to defeat the
forces of inflation -- and to help achieve greater personal
and national security through Federal Payroll Savings
0
000
!
UNITED STATES SAVINGS BONDS ISSUED AND REDEEMED THROUGH April 30, 1969
I
C
,
(Dollar amounts in millions - rounded and will not necessarily add to totals)
DESCRIPTION
---.
rURED
jrries A-1935 thru D-1941
jpries F' and G-1941 thru 1952
;pries J and K-1952 thru 1957
AMOUNT ISSUEDY
AMOUNT
REDEEMEDY
AMOUNT
OUTSTANDING1I
70 OUTSTANDING
OF AMOUNT ISSUED
5,003
29,521
3,754
4,996
29,481
3,709
7
40
45
.14
.14
1020
1,880
8,301
13,360
15,580
12,242
5,553
5,268
5,448
5,377
4,700
4,067
4,262
4,866
4,960
5,167
4,990
4,697
4,576
4,290
4,296
4,344
4,183
4,664
4,547
4,446
4,784
4,735
4,448
295
1,661
7,343
11,847
13,730
10,614
4,633
4,239
4,292
4,151
3,578
3,097
3,219
3,587
3,582
3,671
3,497
3,224
3,004
2,738
2,630
2,489
2,334
2,421
2,368
2,269
2,240
2,043
1,362
-
219
958
1,513
1,850
1,628
920
1,028
1,156
1,227
1,123
469
1,043
1,279
1,377
1,496
1,492
1,474
1,572
1,552
1,665
1,856
1,850
2,244
2,179
2,176
2,544
2,692
3,066
295
11.65
11.54
11.32
11.87
13.30
16.57
19.51
21.22
22.82
23.89
23.83
24.47
26.28
27.76
28.95
29.90
31.38
34.35
36.18
38.76
42.73
44.23
48.11
47.92
48.94
53.18
56.85
69.38
100.00
719
1,004
-285
161,045
116,866
44,179
27.43
5,485
7,014
3,323
1,607
2,161
5,407
39.40
77.09
12,499
4,931
7,568
60.55
173,544
121,797
51,747
29.82
38,277
173,544
211,821
38,186
121,797
159,983
92
51,747
51,839
.24
29.82
24.47
MATURED
,('Ties E.1I :
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
Unclassified
Total Series E
Series H (1952 thru May, 1959) JJ
H (June, 1959 thru 1969)
Total Series H
Total Series E and H
{Total matu,.d
All Series
Total unmatured
Grand Total
'eludes accrued discount.
I"rent redemption value.
r option of owner bonds may be held and will earn interest for additional periods BIter
ori~;nlll
~,
-
maturity date3.
F .... m PD 3812 (Rev. Apr. 1969) - TREASURY DEPARTMENT - Bureau of the Public
D.llt
.J
\;
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 8, 1969
FOR RELEASE AT NOON
THURSDAY, MAY 8, 1969
DOROTHY ANDREWS ELSTON TAKES OATH OF OFFICE
AS THIRTY-THIRD TREASURER OF THE UNITED STATES
Mrs. Dorothy Andrews Elston of Middletown, Delaware, took
the oath of office today as 33rd Treasurer of the United
States. It was administered by Secretary of the Treasury
David M. Kennedy in a noon ceremony at the Treasury Department.
A native of Wilkes-Barre, Pennsylvania, and a long-time
resident of Delaware, Mrs. Elston is a former President of
the National Federation of Republican Women. Her mother,
Mrso Mabel Aston Andrews of Wilmington, Delaware, took part in the
ceremony by holding the century-old Welsh family Bible used
in the oath-taking. Also present were a number of Senators
and Representatives in addition to friends and relatives
from several states.
Besides her long association with Republican Party
organs in numerous national, state and local capacities,
Mrs. Elston has been actively affiliated with the Grange,
the Daughters of the American Revolution, and the General
Federation of Women's Clubs. She has served a three-year
term as a trustee of Kruse School, a state correctional
institution in Delaware, and was for an equal period a state
advisor to the Farmers Home Administration. In 1964-65 she
was on the Advisory Board of the New York World's Fair and in
1965 was a delegate to the White House Conference on
International Cooperation.
For 22 years Mrs. Elston has owned and operated a l83-acre
nursery farm in McDonough, Delaware. She is a member of
St. Paul's Methodist Church in Odessa, Delaware, and has
served it in both pastoral and administrative capacities. In
1964 the League of Women Voters of the United States cited
Mrs. Elston as one of 12 outstanding political women in the
country.
(OVER)
K-85
- 2 -
As Treasurer of the United States, whose office is
within the Treasury's Fiscal Service, Mrso Elston is
responsible for receipt, custody and disbursing of public
funds and for maintaining records as to their source,
location and disposition. New issues of paper currency will
bear her signature in addition to that of Secretary Kennedy.
000
TREASURY DEPARTMENT
IJ
!
WASHINGTON, D.C.
l'OR :IMMEDIATE RELEASE
May 9, 1969
PRELIMINARY RESULTS OF CURRENT EXCHANGE OFFERING
Preliminary figures show that about $5,107 million, or 74.9~ of the $6,818
lillion notes and bonds maturing May 15 and June 15 have been exchanged for the
~wo notes included in the current offering.
Subscriptions total $2,401 million for the 6-3/8~ notes of Series D-1970 and
~2,706 million for the 6-1/2'/0 notes of Series B-JQ76, of which $2,140 million for
~he 6-3/8~ notes and $2,233 million for the 6-1/2~ notes were received from the
public.
Of the eligible securities held outside the Federal Reserve Banks and Government
~ccounts $3,197 million, or 84.5~ of an aggregate of $3,784 million, of May 15
11aturities and $1,176 millior', or 54.9~ of an aggregate of $2,144 million of Jll;le
15 maturities were exchanged.
Following is a breakdown of securities to be exchanged (amounts in millions):
ELIGIBLE FOR EXCHANGE
Securities
5-5/8'/0 notes, B-1969
2-1/2~ bonds, 1964-69
Total
Date
Due
5/15/69
6/15/69
SECURITIES TO BE ISSUED
6-3/810
6-1/'i{o
Amount
Notes
D-1970
Notes
B-1976
$ 4,277
2,541
$ 6,818
$ 1,753
648
$ 2,401
$ 1,786 $3,539 $ 738
$
Total
920 1.568
2,706 $5,107
UNEXCHANGED
Amount
J?
973
$1,711
17.3
38.3
25.1
-
Details by Federal Reserve Districts as to subscriptions will be announced later.
K86
((
TREASURY DEPARTlY1ENT
WASHINGTON. D.C.
Hay 9, 1969
FOR A.M. RELEASE,
SUNDAY, HAY 11, 1969
TREASURY EXPLAINS ITS TAX PROPOSALS DO NOT BAR
VOTER REGISTRATIO~ DRIVES BY PUBLICLY-SUPPORTED,
TAX-EXE~WT ORGA~IZATIONS
The Treasury Department explained today that its recent
recomQendations to Congress regarding tax-exe~pt private
foundations ~ould not prohibit them froD making grants to
publicly-supported tax-exempt charitable or educational
organizations which among their functions carryon voter
registration drives or other permitted political activity.
The recoru.:7l2ncations ,vould, however, prohibit private
foundations from the~selves engaging in voter registration
drives or ocher activity affecting ?olicical cacpaig~s.
Under present law, all organizations exempt froQ t~x
under % 501 (c)(3) of the Internal Revenue Code as charitable,
educational, religious or similar insticutions, includin~
private foundations, are subject to two prohibitions on
politically-related activities.
First, no substantial part
of the activities of the organizacion may consist of carrying
on propaganda or other~ise attempting to influence legislation.
Second, the organization may not intervene in 2:1y political
campaign or. cenalf of any candidace for public office.
The Treasury Department has reco~~ended to Congress that
with respect to privace foundations, the second prohibition
be broadened. T..'1US, a private foundation ,vould be prohibited
from engagir.3 in any activity intended to affect a Dolitical
campaign.
This -would include sponsori_ng voter registratio:1
drives, educational campaigns as to the issues in the policical
campaign, or panel discilssions b2tween the candidates.
K-87
- 2 The Treasury Department recommendation would not
prohibit or affect voter registration drives or other such
political activities by charitable or educational organizations
other than private foundations.
Moreover, under the Treasury Department recommendation,
private foundations would be permitted, as at present, to make
grants to publicly-supported tax-exempt charitable or
educational organizations which as a part of their permitted
functions carryon voter registration drives or other such
political activities.
In summary, the Treasury Department has recommended
provisions to insure proper activities by private foundations,
~"hich are not subj ect to the discipline of public support,
without in any way impeding legitimate social action conducted
by organizations which are substantially supported by, and
thus in some measure responsible to, the general public.
000
TREASURY DEPARTMENT
WASHINGTON, D.C.
May 12, 1969
FOR IMMEDIATE RELEASE
TREASURY LIFTS COIN MELTING BAN AND REVISES
WEEKLY SILVER SALES PROGlffiM
The Treasury Department announced today that it will reduce
the amount of silver offered at its weekly auction from
2 million ounces to 1-1/2 million ounces, and lift the ban on
melting silver coins.
Silver sales will be open to all bidders.
The announcement followed a meeting of the Joint Commission
on the_Coinage, chaired by Secretary of the Treasury David
Kennedy.
The Treasury will present and urge prompt enactment of
legislation to authorize the minting of a non-silver, half
dollar -- the minting of a non-silver dollar coin -- and, under
a plan recommended by the Joint Commission, sale of the
2.9 million rare silver dollars still held by the Treasury. The
recommendation was made by the Commission on December 5~ 1968.
The Treasury will also reduce the weekly amount of silver
offered for sale through the General Services Administration
from the present 2 million ounces to 1-1/2 million ounces, and
maintain this level until the present surplus of about 150 million
ounces is exhausted. A set-aside for small businesses will be
continued.
The GSA weekly silver sale will be open to all competitive
bidders without restriction on the use of the silver purchased and
the existing administrative ban on the melting and export of
silver coins will end.
Changes in the amount of GSA weekly sales and the bidding
procedure will be effective as of the May 27 offering. Details
of this change will be announced by the GSA shortly.
The end to the ban on the melting and export of silver coins
will take effect immediately.
A copy of Secretary Kennedy's statement to the Commission is
attached.
Attachment
K-88
?-\
OPENING STATEMENT OF THE SECRETARY BEFORE
THE MEETING OF THE JOINT COINAGE COMMISSION
MAY 12, 1969, 9:30 A. M.
This is the first meeting of the Joint Commission on the Coinage
under the new Administration and I want to express my appreciation
and that of President Nixon for your taking the time from busy schedules
to give us the benefit of your thinking on some hard decisions that must
be made on our remaining silver and coinage issues.
Under authority of the Coinage Act of 1965, this bipartisan
Commission has the responsibility of giving advice on silver and coinage
problems to the President, the Secretary of the Treasury, and the
Congress.
When it was first activated I think few envisaged the key
role the Coinage Commission would play in the actual policy decision
making process.
In addition to making available to the Treasury a broad
range of expertise on complex monetary problems, the Commission
meetings have served as a useful forum for a frank exchange of views
between the Administration and key members of Congress which has
clearly been in the best public interest.
At this time we again seek
your advice.
For a number of weeks a Task Force within the Treasury headed
by General Counsel Paul Eggers and including Assistant Secretary Rossides,
- 2 -
Deputy Under Secretary MacLaury, and other officials has been taking
a hard look at the entire range of silver and coinage policy issues.
The
basic objective of this broad review was not simply to reach judgments
on each of these issues in isolation but rather to develop a balanced
over-all program, fair to the public as consumers and taxpayers as
well as to silver producers and industrial users.
The Treasury group
has completed its work and a copy of their report has been sent to each
of you.
r have
carefully reviewed the report of the Treasury Task Force
on Silver and Coinage Policy and strongly endorse the recommendations
therein as being fully in the public interest.
The proposed legislative
and administrative actions will be discussed in the course of our meeting,
but let me briefly review the highlights and give you some of the reasons
why
r consider this
to be a sound program.
The first recommendation, for the minting of a non-silver clad
half dollar, is consistent with the conclusions reached by the Commission at its meeting last December.
r think the convincing argument
here is that despite the minting of some 760 million 40 percent silver
half dollars over the past three years, very few of these coins are
actually circulating.
Even if we were to continue pouring all of our
remaining 150 million ounces of surplus silver into the silver half
- 3 quantity.
Moreover, this use of our remaining silver would require
a halting of surplus silver sales which would very probably drive the
price up excessively and further stimulate the hoarding of these coins.
In short, the 40 percent half dollar on our past experience is simply
a losing proposition.
If we are authorized to mint a non-silver half dollar, I am
confident that within a reasonable period of time this coin will circulate
in adequate quantity for all commercial needs.
The second major recommendation in the Treasury Report, and
one to which we gave a great deal of careful attention, is that the current
administrative ban on the melting and export of silver coins be discontinued.
I am aware that at your meeting last December the Coinage
Commission reached a different conclusion, but I think the basic
situation has substantially changed and a review of this issue is in order.
In contrast to the situation in the past, the melting ban no longer either
keeps silver coins in circulation or contributes to the Treasury's supply
of silver coins.
inventory.
Since July 1968 we have added very few coins to our
And I rather doubt that a determination by the Congress
affirming the ban would cause any appreciable amount of these coins
to circulate.
In short, I think there is no longer a really constructive
reason for maintaining the ban on the melting of coins which was first
established in 1967 for purposes which no longer apply.
- 4 -
The Treasury Report next covers sale of surplus silver through
the GSA and recommends that the weekly amount offered be reduced
from 2 to 1-1/2 million ounces.
At the same time the Report urges
that it be made clear, as nearly as possible, how long these silver sales
will be maintained.
The purpose of the latter point is to reduce the
element of uncertainty which has disrupted the market in the past.
If,
as recommended, the minting of a non-silver half dollar is authorized
then all of the Treasury's current supply of silver becomes surplus to
its needs.
As you know. a separate 165 million ounce strategic stockpile
of silver has already been established by law.
In the judgment of the
Office of Emergency Preparedness this stockpile is fully adequate for
emergency needs.
I would point out that the GSA sale of silver not only adds to the
Treasury's revenue but makes a solid contribution to our balance of
payments by reducing the need for commercial silver imports.
judgment these sales should be continued.
In my
However, we must recognize
that at some point the Government will cease to be a silver supplier.
It is clearly in the public interest that the market adjustment to this
fact be as smooth as possible.
I think a reduction in the weekly amount
of silver offered and the maintenance of sales at that level will tend
to ease this adjustment.
If we set a firm sales figure and indicate the
- 5 -
pool of surplus silver to be made available, both silver producers and
consumers will be on notice as to when, within reasonable limits, the
Treasury supply will end and can base their planning on this awareness.
The Treasury Report also recommends that the GSA silver sales
be open to all bidders with no restrictions on the silver purchased.
When
these sales were begun in August 1967 the Treasury, mainly because of
the prevailing refinery strike, required that the silver purchased be
used in domestic industry.
However, it was also announced at that time
that this restriction would be removed as soon as feasible.
I think this
change should be made now.
The final two recommendations of the Treasury Report are in
accord with the decisions reached by this Commission at its
December meeting.
The first is that the Congress authorize the
minting of a non-silver dollar coin.
and fully endorse it.
I think this is an excellent idea
Such a coin should be increasingly useful in
the future, particularly in view of the steady expansion of the
vending machine industry.
The final recommendation in the Treasury Report is an
endorsement of the plan sponsored by the Coinage Commission to
dispose of the Treasury's 2. 9 million rare silver dollars.
While
- 6 any plan for this purpose will
ha\'(:~
shortcomings - and this one is no
exception - I think the plan is the best I have seen and deserves serious
consideration by the Congress.
This then is a brief summary of the highlights of a program which,
in my judgment, constitutes a reasonable and balanced approach to
resolving the silver and coinage issues this Commission has been
concerned with since its inception.
000
- 5 -
pool of surplus silver to be made available. both silver producers and
consumers will be on notice as to when. within reasonable limits. the
Treasury supply will end and can base their planning on this awareness.
The Treasury Report also recommends that the GSA silver sales
be open to all bidders with no restrictions on the silver purchased.
When
these sales were begun in August 1967 the Treasury. mainly because of
the prevailing refinery strike. required that the silver purchased be
used in domestic industry.
However. it was also announced at that time
that this restriction would be removed as soon as feasible.
I think this
change should be made now.
The final two recommendations of the Treasury Report are in
accord with the decisions reached by this Commission at its
December meeting.
The first is that the Congress authorize the
minting of a non-silver dollar coin.
and fully endorse it.
I think this is an excellent idea
Such a coin should be increasingly useful in
the future. particularly in view of the steady expansion of the
vending machine industry.
The final recommendation in the Treasury Report is an
endorsement of the plan sponsored by the Coinage Commission to
dispose of the Treasury's 2. 9 million rare silver dollars.
While
- 6 any plan for this purpose will ha,.T<' shortcomings - and this one is no
exception - I think the plan is the best I have seen and deserves serious
consideration by the Congress.
This then is a brief summary of the highlights of a program which,
in my judgment, constitutes a reasonable and balanced approach to
resolving the silver and coinage issues this Commission has been
concerned with since its inception.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 13, 1969
FOR IMMEDIATE RELEASE.
TREASURY MARKET TRANSACTIONS IN APRIL
During April 1969, market transactions
in Federal Securities of Government accounts
resulted in net sales by the Treasury
Department of $28,527,000.00.
000
K-89
TREASURY DEPARTMENT
WASHINGTON, D.C.
)R RELEASE 6:30 P.M.,
)nday, May 12, 1969.
RESULTS OF TREASURY S WEEKLY BILL OFFERING
I
'!be Treasury Department announced that the tenders for two series of Treasury
llls, one series to be an additional issue of the bills dated February 13, 1969, and the
~her series to be dated May 15, 1969, which were offered on May 7, 1969, were
;>ened at the Federal Reserve Banks today. Tenders were invited for $1,700,000,000,
~ thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 182-day
llls. The details of the two series are as follows:
UiGE OF ACCEPmD
)MPETITIVE BIDS:
High
Low
Average
~/
91-day Treasury bills
maturi~ Au~st 14 z 1969
Approx. Equiv •
Annual Rate
Price
98.480 !I
6.013~
98.451
6.128~
98.462
6.084~ 1/
182-day Treasury bills
maturi~ November 13 z 1969
Approx. Equiv.
Price
Annual Rate
96.891
6.15~
p/
96.852
6.227~
96.870
6.191~
1/
Excepting 1 tender of $150,000; ~Excepting 2 tenders totaling $357 000
10~ of the amount of 91-day bills bid for at the low price was accepted
34~
of the amount of 182-day bills bid for at the low price was accepted
)TAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
roTALS
Acce;Eted
AI!;E1ied For
$ 29,609,000 $ 19,609,000
1,890,152,000 1,182,152,000
24,796,000
39,796,000
37,567,000
37,567,000
14,986,000
15,486,000
47,159,000
50,159,000
133,898,000
158,898,000
42,972,000
44,972,000
28,535,000
28,535,000
36,645,000
36,646,000
20,388,000
28,388,000
111,893 z 000
151 z893, 000
AI!;E1ied For
$
7,596,000
1,789,555,000
17,485,000
27,788,000
8,768,000
31,096,000
131,858,000
32,358,000
22,672,000
13,071,000
19,252,000
115,961,000
Acce;Eted
$
7,596, 000
988,635,000
7,485,000
27,788,000
7,368,000
17,653,000
106,558,000
29,858,000
22,672,000
13,071,000
9,252,000
62,161,000
$2,512,101,000 $1,700,600,000 ~/
$2,217,460,000
$1,300,097,000
~/
Includes $327,685,000 noncompetitive tenders accepted at the average price of 98.462
Includes $150,169,000 noncompetitive tenders accepted at the average price of 96.870
These rates are on a bank discount basis. '!be equivalent coupon issue yields are
6.27~ for the 91-day bills, and 6.4~ for the 182-day bills.
27
TREASURY DEPARTMENT
CONSOLIDATED LAW ENFORCEMENT TRAINING CENTER
Introductory Statement of Eugene T. Rossides
Assistant Secretary of the Treasury
For Presentation to the Subcommittee on
Public Buildings and Grounds of the
House Public Works Committee
10~OO
A.M., Tuesday, May 13, 1969
Mr. Chairman and Members of the Committee:
I welcome the opportunity to appear before you
today to discuss the authorization requested by the
Treasury Department for the Consolidated Law Enforcement
Training Center.
My statement covers the following five points:
1.
The proposed facility is a major part of the
President's overall effort to improve law enforcement
in the drive against crime.
2.
The urgent need for this facility by the
Treasury Department, the second largest law enforcement
department in the Government, as well as the need of
some twenty other Federal law enforcement agencies.
3.
The Warren Commission Report stressing the
need for the Secret Service to have adequate manpower
and facilities.
K-90
-2-
4.
There is no duplication between the FBI facilities
and the proposed training center, as the FBI facilities-both existing and the proposed enlargement at Quantico,
Virginia--are and will be utilized to full capacity and
cannot be used by the Treasury enforcement agencies and
some twenty other Federal enforcement agencies.
5.
The difference in facilities and training
methods between the specialized enforcement agencies
of the Treasury Department, as well as many of the
other agencies scheduled to use the proposed new Center,
and those of the FBI facility.
-
1.
3 -
The proposed facility is a major part of the
President's overall effort to improve law enforcement
in the drive against crime.
In the review of President Johnson's budget, the
Consolidated Law Enforcement Training Center was carefully
considered by the new Administration and fully endorsed.
It will be an important part of the overall effort to
improve and strengthen law enforcement ability and
capability in the fight against crime which is of such
national concern.
The Center will be a major asset in
the war on crime.
We must support our law enforcement
effort and give these dedicated men the facilities and
equipment they so urgently need.
One of the great areas that has been neglected in
our national life is the proper training in proper
facilities of our law enforcement officials on a
national, state and local basis.
We must elevate the
30
- 4 -
status of law enforcement as a profession.
at the Treasury are pledged to do.
This we
We seek your
necessary support.
On the national level, the proposed Consolidated
Law Enforcement Training Center facility is urgently
needed and long overdue.
3/
- 5 -
2.
The urgent need for this facility by the
Treasury Department, the second largest law enforcement
department in the Government as well as the need of
some twenty other Federal law enforcement agencies.
The Treasury Department, the second largest
enforcement department in the Government, is in dire
need of the proposed facility.
The current facilities
utilized by the Treasury Agents of the Secret Service,
the Customs Agency Service, and the enforcement arms
of the IRS, are grossly inadequate.
Mr. Chairman, we at Treasury are greatly concerned
that the Secret Service does not have adequate facilities
in being today.
They are operating at a distinct
handicap.
To obtain efficient, highly trained agents, we must
have the necessary facilities and equipment.
- 6 -
The Bureau of the Budget concurred in the urgent
need of the Secret Service for proper facilities and
then reviewed the facilities of other law enforcement
agencies of the Federal Government and found them
wanting.
The Bureau of the Budget then chaired an
inter-agency committee which recommended the proposed
Consolidated Law Enforcement Training Center.
)5
- 7 -
3.
The Warren Commission Report stressing the
need for the Secret Service to have adequate manpower
and facilities.
The Warren Commission, of which Senator Cooper was
a distinguished member, concluded that the Secret Service
did not have adequate resources of personnel and facilities;
that the situation "should be promptly remedied"; and
recommended that the Secret Service "be provided with
the personnel and resources which the Service and the
Department of the Treasury may be able to demonstrate are
needed to fulfill its important mission."
The Commission Report stated in Part l2(a) of its
Conclusions, as follows:
"(a)
The complexities of the Presidency
have increased so rapidly in recent years that
the Secret Service has not been able to develop
or to secure adequate resources of personnel
- 8 -
and facilities to fulfill its important assignment.
This situation should be promptly remedied."
Recommendation 7 of the Warren Commission reads in
part as follows:
"The Commission recommends that the Secret Service
be provided with the personnel and resources which
the Service and the Department of the Treasury
may be able to demonstrate are needed to fulfill
its important mission."
The Commission noted that the Secretary of the
Treasury had prepared a planning document dated August
27, 1964, which recommended additional personnel and
facilities to enable the Secret Service to expand its
protection capabilities.
That planning document was
submitted on August 31, 1964, to the Bureau of the
Budget for review and has been made a part of the Warren
Commission's published record.
With your permission,
- 9 -
Mr. Chairman, a copy of that document is submitted for
the record.
The underlying staff and consultants' reports
examined by the Commission had not been made a part of
the public record, since the disclosure of such detailed
information relating to protective methods might undermine present methods of protecting the President.
Mr. Chairman and members of the Committee, unless
this prospectus is approved, it is clear that the Secret
Service will not have the facilities it needs and which
the Warren
Com~nission
recommended thi;lt it obtain.
- 10 4.
There
1S
no duplication between the FBI
facilities and the proposed training center, as the FBI
facilities--both existing and the proposed enlargement
at Quantico, Virginia--are and will be utilized to full
capacity and cannot be used by the Treasury enforcement
agencies and some twenty other Federal enforcement
agencies.
The Department of Justice testified at the hearing
before the House Public Works Subcommittee on Buildings
and Grounds in support of the proposed Training Center,
pointing out the full utilization by the FBI and State
and local police employees throughout the nation of
existing FBI facilities and of the proposed enlargement
of those facilities.
A representative of the Department
of Justice is here today and will elaborate on that point.
~]
- 11 -
I
5.
The difference in facilities and training
methods between the specialized enforcement agencies
of the Treasury Department, and many of the other
agencies scheduled to use the proposed new Center,
and those of the FBI facility.
The Consolidated Training Center includes the
provision of a number of outdoor training facilities
that require large acreages.
There is no FBI
requirement and no physical space at Quantico for
these facilities which include:
a.
The vehicular range, which the Secret Service
will use for motorcade training and other protective
training.
This range also provides an area of false
front buildings for training in the firing of
weapons from a vehicle.
The course contains an
overpass, various types of curves and uphill and
downhill driving.
- 12 -
b.
Raid and crowd demonstration areas which include
mock-ups of residential, commercial and rural
settings for both day and night exercises.
This
includes such special facilities as outdoor stills,
border tracking areas, model recreation areas, and
industrial buildings.
The Consolidated Center is designed to handle small
classes from many different kinds of organizations, in a
wide variety of training programs.
The basic unit is a
24-man classroom, fully equipped and supplemented by a
large proportion of breakout rooms for very small groups
for individual student participation and performance.
- 13 -
Mr. Chairman, that concludes my statement.
As I
mentioned earlier, the proposed Consolidated Law
Enforcement Training Center is urgently needed and long
overdue.
We seek your necessary support.
has his statement for the Committee.
Director Rowley
I shall be pleased
to answer any questions that you or members of the
Committee may have.
EXPANDED AND IMPROVED TRAINING FACILITIES
Expanded and improved training facilities will
be required for the training of all Service personnel
and also for the proposed Headquarters Detail.
The limitations of the present facility have long
been recognized, and in 1961 definite plans were laid
and an active program started to develop a new training
facility to meet the particular needs of the Service.
The present facility is inadequate in that it does not
provide necessary class room accommodations and is too
small to be expanded for new and vitally needed training.
In addition, its operations constitute a hazard to
visitors to the National Arboretum where it is located.
A site was found at the Agricultural Research
Center at Beltsville, Md.
Through cooperation of the
Department of Agriculture, the site will be available
ATTACHMENT
il
when needed.
The General Services Administration has been most
cooperative in assisting in the development of the
new facility and is now completing a detailed prospectus.
It has included a request for funds in its budget.
This new training center will provide not only for
all phases of Secret Service operations but for White
House Police Force and Treasury Guard Force.
It will be
particularly helpful in new programs for expanded training
in connection with our protective responsibilities.
These
i
include training in the use of many types of weapons where
safety is a factor.
They also include specialized
training regarding techniques to be used with the
Presidential automobile and follow-up vehicles.
Adequate
space will be available at the new center for simulated
conditions using vehicles and other items under favorable conditions for training.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
May 14, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY
The Treasury Department, by
for two series of Treasury bills
$3,000,000,000, or thereabouts,
Treasury bills maturing May 22,
$3,005,486,000,
as follows:
BILL OFFERING
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
1969,
in the amount of
9~day
bills (to maturity date) to be issued
May 22, 1969,
in the amount of $ 1, 700,000,000,
or thereabouts, representing an
additional amount of bills dated February 20, 1969,
and to
mature August 21, 1969,
originally issued in the amount of
$1,104,142,000,
the additional and original bills to be
freely interchangeable.
182...day bills, for $ 1,300,000,000,
dated
May 22, 1969,
and to mature
or thereabouts, to be
November 20, 1969.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing lrour, one-thirty p.m., Eastern Daylight Saving
time,
Monday, MdV 19, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-9l
- L responsible and recognized deal.ecs in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on May 22, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing May 22, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Seccions 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as ·capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
T'REASURY DEPARTMENT
,
WASHINGTON, D.C.
FOR RELEASE A.M. 's
FRIDAY, MAY 16, 1969
May 15, 1969
TREASURY GENERAL COUNSEL URGES
CITIZEN SUPPORT IN CRIME FIGHT
(Note to Editors.
There is no text available of Mr. Eggers' speech)
Treasury General Counsel Paul W. Eggers told a Houston audience
. tonight that "crime is turning America into a mole society. Our
: people are becoming fearful of venturing out of doors -- some: thing not even the threat of nuclear destruction has been able to
. do to our way of living."
He said a massive national educational program is needed to
". enlist public support at the local level in the president's
recently announced campaign against organized crime.
Mr. Eggers said that along with solving the Vietnam War,
curbing inflation is the key to sound economic growth and will
permit more effective government action in solving our other
domestic problemso
He said that the president's decision to proceed with
deployment of the Safeguard anti-ballistic missile defense
system (ABM) "shmvs a firm determination that this nation will
not have to negotiate from an inferior position." He said
that debate on the ABM is "a healthy sign in our democracy,"
and expressed confidence that Congress would approve its
deployment.
"No one, regardless of social status," Mr. Eggers told
a joint annual meeting of the Houston Business and Estate
Council and Houston Estate and Financial Forum, "is safe from
crime's onslaught, which rolls forward like some medieval
plague from the Middle Ages -- engulfing everything and
everybody."
He said: "Fleeing the cities is not an answero The enemy
is pursuing us to the suburbs and even the countryside.
K-92
- 2 -
Wherever we go, fear remains with us. As citizens we wonder if
anyone -- including our government -- really cares."
He said that president Nixon's recent message to Congress
on fighting organized crime signifies that the government does
care and is now embarked on a national campaign. "We will use
all the weapons at our disposal to bring domestic tranquility to
the nation," he said o
"One of our greatest weapons is to enlist the aid of the
public, particularly at the local level," he said, "but much
more needs to be done in educating the public to the dangers
of organized crime."
Mr. Eggers said that it is at the local level that the
organized crime syndicate exercises its corrupting power, and
the President is determined that the cities and states shall
plaY,a significant part in wagering the battle against crimeo
'~ile the Federal government stands ready to provide the
leadership, funding support, and to coordinate the efforts and
available resources in cooperation with our cities and states,
the main effort must come from the local level."
"The Federal government just can not manage community
affairs since the basic responsibility for the welfare of our
citizens lies with the states and their subdivisions."
Mr. Eggers said that the Treasury Department with its more
than 5,000 enforcement agents -- the second largest law
enforcement department of the Federal government -- is in the
vanguard of the expanded war against crime.
"Treasury is participating in this effort on a full
partnership basis with the Department of Justice and other
Federal departments and agencies," he said.
- 3 -
The complete resources of the Department -- including each
of its investigative and enforcement arms -- are being strengthened
in pressing this war, he said. The Department is asking Congress
for $9.4 million for 680 additional enforcement personnel. In
addition, the Department, is requesting $1.2 million to design a
proposed Law Enforcement Training Facility to be constructed near
Beltsville, Maryland, just outside of Washington, D. C.
The school would function as a new activity of the Treasury
Department, providing training for law enforcement agencies of
the Federal government, other than the Federal Bureau of
Investigation. The planned $18 million facility would consist
of a campus-like training center with modern classrooms, firing
ranges, specialized training areas and equipment, dormitories,
support facilities, and services to accommodate 750 resident
students from 20 federal law enforcement agencies, Mr. Eggers
said.
He pointed out that the status of Treasury's law enforcement
effort has been upgraded by putting it under the direct
supervision of an Assistant Secretary who is in the process of
enlarging and reorganizing his staff and upgrading Treasury's
law enforcement in keeping with Treasury's expanded efforts.
The General Counsel's office, for the first time, has hired
an attorney with a background in criminal law in order to better
support Treasury's law enforcement efforts, Mr. Eggers said.
000
TREASURY DEPARTMENT
WASHINGTON, D.C.
i'QR IMMEDIATE RELEASE
MAY 14, 1969
SUBSCRIPTION FIGURES FOR CURRENT EXCHANGE OFFERING
The results of the Treasury's current
exchan~
offering of
6-3/8~ notes dated May 15, 1969, maturing August 15, 1970, and
6-1/2~ notes dated May 15, 1969, maturing May 15, 1976,
"re summarized in the following tables.
For Cash Redemption
~ of
~ of
Total
Public
Total
OutHoldAmount
standing
ings
Amount
Exchanged For
Eligible
6-378~ 6-1/2~
for Exchange Notes
Notes Total
{Amounts in mil1~i~o~n~s~)~------~--~----~~--
Issues Eligible
for Exchange
5-5/~ Notes, B-1969 $ 4.277
2-1/2~ Bands, 1964-69
2,541
Total
$ 6,818
$1,767
665
$1,783 $3,550
930 1. 595
$ 728
9'6
17.0
37.2
4:).8
$2,431
$2,713 $5,144
$1674
24.6
25.6
---
Exchan~es for 6-3L~ Notes of Series D-1970
Federal Reserve
District
5-5/8~ Notes
Series B-1969
2-1/2~ Bonds
of 1964-69
Boston
New York
Phi lede lphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
$
41,214,000
877,109,000
45,752,000
85,691,000
30,893,000
113,955,000
178,120,000
107,829,000
24,382,000
62,168,000
70,096,000
125,371,000
3 z 948 z000
$
5,562,000 $
66,776,000
392,274:,000
1,269,383,000
9,069,000
54.,821,000
9,811,000
95,502,000
10,430,000
4:1,323,000
40,341,000
154:,296,000
51,922,000
230,042,000
29,273,000
137,102,000
29,765,000
5,383,000
10,741,000
72,909,000
79,097,000
9,001,000
212,74.3,1')00
87,372,000
3 z4:15 z000
7z36:5~OOa
$1,766,528,000
$
664,594.,000 $ 2,4:31,122,000
'roTAL
K-93
Total
J5.2
- 2 ExchanBe s f::;r 6-1!..2~ Notes of Series B-1976
r
)8-1jJ
;)-..)
Federal Reserve
District
Ibtes
Series B-1969
2-1/2~~ Bonds
of 1964-69
Boskm
New Yor:-<.
Philadelphia
Cleveland
Richr.'tond
Atlanta
Chicago
S-c.. L::mis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
$
76,887,000
1,096,011,000
33,469,000
63,140,000
26,463,000
44,359,000
146,082,000
55,069,000
22,768,000
46,761,000
26,549,000
14:3,980,000
1,523,000
$ 5,152,000
570,812,000
16,613,000
21,255,000
17,734,000
11,497,000
94,132,000
19,973,000
16,186,000
22,606,000
15,137,000
117,673,000
1,202,000
4>
$1,783,061,000
$929,972,000
$ 2 , 713 ,033 ,000
TOTAL
Total
82,039,000
1,666,823,000
50,082,000
84,395,000
44,197,000
55,856,000
240,214,000
75,042,000
38,954,000
69,367,000
41,686,000
261,653,000
2,725,000
FOR RELE1.SE I.T 3:30 P.M.
THURSDAY, MAY 15, 1969
STP,TEMENT OF THE HONORABLE JOHN R. PETTY
ASSISTANT SECRETARY OF THE TREASURY
BEFORE THE
SENATE COMMITTEE ON fPPROPRIATIONS
SUBCOMMITTEE ON DEFICIENcES AND SUPPLEMENTALS
ON THE
APPROPRD\TION OF THE FIRST INSTALLMENT OF THE
U. S. CONTRIBUTION TO THE SECOND REPLENISHMENT
OF THE RESOURCES OF THE
INTERNlTIONi~L DEVELOPMENT ASSOCIATION
W.Y 15, 1969
Mr. Chairman and members of the Committee: I appreciate
this opportunity to appear in behalf of the Administration in
support of
~n
appropriation of $160 million for the first of
three equal annual contributions by the United States of its
share in the second replenishment of the International Development lssociation (IDP.) an 8ffiliate of the International
Bank for Reconstruction and Development.
The Senate yesterday passed without amendment H.R. 33,
which authorizes the U. S. Governor of IDA to agree on behalf
of the Uaited States to contribute $160 million as our share
in each of these years.
The bill was passed by the House
of Representatives on March 12.
Under this replenishment, the 18 economically advanced
member countries of IDl plus Switzerland would provide IDl
with $400 million of additional resources in each of the
fiscal years 1969, 1970, and 1971.
K-94
- 2 There is an urgent need for the replenishment to take
effect if IDA is to continue its lending operations.
Without
the replenishment, IDA's resources available for new credit
commitments will soon be exhausted.
The replenishment agreement, however, cannot take
effect until twelve countries with aggregate contributions
of at least $950 million have formally committed their
pledges, and this requirement cannot be met until the
agrees to participate.
u.s.
A sufficient number of other countries
have completed legislative action to enable the agreement
to take effect as soon as the U.S. takes this step.
Under the terms of the agreement our contribution for the
first year will have to be paid - in the form of a letter of
credit - within thirty days after the agreement takes effect.
It is therefore necessary for us to be in a position to make
a prompt first
paym~nt
on our pledge.
Consequently, the
need for action on this appropriation request is particularly
urgent.
The
U.s.
contribution to the replenishment represents
40 percent of the $1.2 billion total, reflecting a continued
decrease in our share in comparison to the initial subscriptions
to IDA of the economically advanced countries in 1960, and their
contributions to the first replenishment in 1964.
~r
I
- 3 -
In addition, an integral feature of the agreement is an
assurance that if the u.s. so requires, there will be no
adverse effect of the u.s. contribution on our balance of payments through at least the end of fiscal year 1971.
Under the agreement, if our current payments imbalance
persists, we will provide in cash until fiscal 1972 only that
part of our contribution which is expended for IDA-financed
purchasing in the United States.
Furthermore, this arrangement
would continue after that until other contributors' shares in
this replenishment are exhausted.
In other words, the agreement
provides that cash payments by the United States -- to the extent
required for purchasing in other countries -- will be postponed.
Instead, other countries will accelerate their contributions
during this period.
This arrangement would not affect IDA and
the World Bank's traditional system of international competitive
bidding.
Expenditures resulting from the replenishment will be substantially less than the appropriated amount of $160 million per
year over the three year contribution period, since the annual
u.S. contribution will be made in the form of a letter of credit
which will be drawn upon only as IDA needs cash to meet its
disbursements.
Cash calls on the u.S. contribution will not
exceed our pro rata share of total calls, and while the u.S.
balance of payments situation requires continuation of the
agreed safeguards, will not exceed amounts needed to pay for
U.S. procurement.
- 4 -
Calls for cash during the period FY 69-FY 71 will therefore be only a fraction of the amounts appropriated in these
years.
The budgetary aspects of our contribution are fully
consistent with our current efforts to exercise maximum
restraint with regard to total federal expenditures.
IDA stemmed from an American idea and has received bipartisan support of four Presidents, members of Congress and
many other leaders in American national life.
primarily at Congressional initiative.
IDA was created
Senate Resolution 264
of 1958 originally suggested establishment of the Association
as an affiliate of the World Bank.
President Eisenhower strongly recommended the formation
of IDA -- pointing out that, "The well-being of the free world
is vitally affected by the progress of the nations in the less
developed areas."
Presidents Kennedy and Johnson encouraged
and approved the subsequent expansion of IDA's operations.
This replenishment now has the full support of President Nixon.
The establishment of IDA in 1960, and the agreement to
provide it with additional and larger resources in 1964, were,
- 5 -
in effect, commitments by other nations to a more equitable
sharing of the burden.
The proposed second replenishment
represents additional progress in that direction.
In the eight years since IDA began operations, several of
the developing countries have made truly impressive progress.
Yet many other countries are advancing only slowly.
The lives
of their people are blighted by hunger, sickness and ignorance.
These nations -- the poorest of the developing world -- urgently
require the assistance that IDA provides.
If they are to pro-
gress, they must have access to credit on terms they can meet -specifically, to credits that can be repaid on easier terms over
a longer period of time.
Development financing on harder
terms would be self-defeating, because mounting debt-servicing
costs would drain away the funds provided, and required, for
economic growth.
As a multilateral agency, IDA offers important advantages:
the objectivity of an international institution
the broad and collective experience of its members
nations
the opportunity to exercise leadership in the development
effort.
IDA is also strengthened by its direct affiliation with
the World Bank.
Because it is directed by the same President,
guided by the same Board of Directors and Governors, and utilizes
- 6 -
the same expert management and staff, we can be certain that its
funds will be expended prudently.
Applications for IDA credits
must meet the same strict standards set for requests for World
Bank loans, and are given the same careful appraisal.
Moreover,
IDA credits, like the Bank's loans, must be amortized in hard
currency.
The only essential difference is that IDA provides
funds in cases where the borrowers need more favorable foreign
currency repayment terms than the Bank can provide.
IDA made its firs t deve lopmen t credit in May 1961.
Through
December 31, 1968 it had extended credits amounting to $1.8
billion in 43 countries and territories.
Large amounts have
gone to India and Pakistan within the framework of the World
Bank consortia organized for those countries.
Under the second
replenishment it is intended to achieve wider geographic
diversification.
Up to now most of IDA's funds have gone into transportation
and other basic economic infrastructure.
Recently,
~owever,
increasing emphasis has been given to agricultural and educatioMl
projects in the realization that improved agricultural productivity and trained manpower are also essential prerequisites of
economic development.
It is essential in my judgment that the vital work of
IDA be continued.
that purpose.
The appropriation we seek today will serve
May 15, 1969
FOR IMMEDIATE RELEASE
STATEMENT BY
SECRETARY OF THE TREASURY DAVID M. KENNEDY
ON FIRST QUARTER 1969
BALANCE OF PAYMENTS RESULTS
The first quarter balance of payments results, announced
today by the Department of Commerce, show sharply divergent
movements in the two principal indicators of our overall
balance.
While the "liquidity" measure was in deficit by
$1. 8 billion, the "offic ial settlements" bas is shows a surplus
of $1.1 billion.
Taken by itself, each of these measures
would be misleading in termS of our present position and
problems.
Each must be considered in light of special
factors affecting it during this period.
1.
The persistent strength of the dollar in the exchange
markets during the first quarter was reflected in the surplus
on the official settlements basis.
K-95
That surplus -- which measures
- 2 -
the improvement in our official net reserve position -- was
accompanied by a decline of the liquid dollar holdings of
several leading European central banks toward minimal working
levels during the quarter.
Essentially, the surplus on official settlements was
dependent on the borrowing of short-term funds abroad by
American banks faced with heavy demands for credit in the
United States and limited domestic sources.
Over time, a
limited increase in foreign private holdings of dollars can
be anticipated, reflecting the use of the dollar as an international currency, and short-term inflows of dollars have
contributed importantly to achieving a surplus on the official
settlements basis in two of the past three years.
However, inflows -- mainly from the Euro-dollar market -of the $3 billion magnitude experienced during the first
- 3 -
quarter are unprecedented.
We could not expect them to be
maintained after our money markets ease appreciably, but as
we gain full control over domestic prices and interest rates
decline, our reliance on this source of funds to balance our
accounts should also be reduced.
2.
The large swing in the liquidity deficit has been
heavily influenced by temporary factors.
Most importantly,
present indications are that the large amount of money
repatriated late last year by U.S. corporations,main1y to
assure compliance with the ceilings on direct investments,
was matched by equally large outflows in the first quarter.
Furthermore, inflows of official medium-term capital,
which served to reduce previous deficits and which were
particularly large in the fourth quarter of 1968, declined
significantly in the first quarter of this year.
- 4 Given the special circumstances of the last two quarters,
the basic trend in our payments can best be analyzed by
averaging the two periods, as follows:
BALANCE OF PAYMENTS RESULTS BY SIX-MONTH PERIODS
(In millions of dollars, seasonally adjusted)
Liguidit~
Including
Special
Transactions
..Balance
Excluding
Special
:Transactions
Official
Settlements
Balance
Six months ending:
March, 1969
926
Sept. , 1968
94
March, 1968
Sept., 1967
Note:
-
2,344
1,324
-
1,911
+ 1,431
- 1,375
+ 1,757
-
2,221
- 1,505
2,233
559
"Special transactions" include, basically,
various governmental transactions of a nonrecurring nature, although some are related to
military neutralization agreements or other
continuing policies.
As the table shows, the combined results of the last two
quarters are well within the recent range.
At the same time, the
data illustrate that the structure of our balance of payments
')3
- 5 remains unsatisfactory.
The salient factors shaping our
recent performance are:
-- More than three years of inflation and excess
demand have eliminated our formerly strong
trade surplus.
-- The extra "first year" impact of the mandatory
direct investment program, when many companies
fell far short of their targets and thus "carried
over" a large portion of their permissible investments, is now behind us.
-- Large private capital inflows have helped offset
the balance of payments costs of our military and
foreign assistance responsibilities, as well as our
outward investment flows.
- 6 -
-- While long-term foreign investment in the U.S.
has been acceleratLng -- as evidenced by
continuing heavy purchases of U.S. stocks by
foreign investors in the first quarter -- we
must recognize that these flows are potentially
more volatile than current payments.
The policy implications of these comments are plain.
As
President Nixon pointed out in his statement of April 4,
" ... the problem of regaining equilibrium in the U.S. balance
of payments cannot be solved with expedients that postpone the
problem to another year."
Only by persisting firmly in our
efforts to restore stable and non-inflationary growth can we
build the base for a sustained trade surplus, while at the
same time maintaining a favorable climate for foreign investment
~
(
- 7 -
The basic fiscal and monetary policies designed to achieve
this aim are now in place.
However, after years of deficit,
a quick and dramatic change in the structure of our payments is
not to be expected.
Fortunately, monetary restraints, related short-term
capital inflows, and the favorable investment climate in the
United States help to protect our position.
They provide the
time needed for the fundamental cures to work.
What we must
do is to use that time effectively to deal with the root causes
of our problems, and thus restore the basis for a sizeable
trade surplus and sustainable equilibrium.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
FOR RELEASE 6: 30 P.M.,
Monday, May 19, 1969.
RESULTS OF 'mEASURY t S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated February 20, 1969, and
the other series to be dated May 22, 1969, which were offered on May 14, 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $1,700,000,000,
or thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 182-day
bills. The details of the two series are as follows:
RANGE OF ACCEPJE)
CCIoD?ETITlVE BIDS:
High
Low
Average
34~
~
182-day Treasury bills
maturing November 20, 1969
Approx. Equi v .
Price
Annual Rate
96.864
6.203i
96.836
6.258i
96.850
6.231i!/
91-day Treasury bills
maturing August 21, 1969
Approx. Equiv.
Price
Annual Rate
98.458
6.10Oi
98.436
6.187~
98.446
6.148~ 1/
of the amount of 91-day bills bid for at the low price was accepted
of the amount of 182-day bills bid for at the low price was accepted
'roTAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Phllade lphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
1UTALS
A~lied
For
Acceyted
27,239,000 $7,239,000
1,284,412,000
2,042,312,000
18,729,000
33,729,000
30,462,000
32,320,000
17,884,000
18,214,000
34,895,000
41,715,000
114,362,000
140,662,000
41,001,000
44,001,000
20,722,000
22,722,000
26,372,000
26,373,000
15,452,000
24,452,000
78,710,000
134,170,000
$
$2,587,909,000
$1,700,240,000
!I
AE,Elied For
$ 10,389,000
1,979,956,000
17,352,000
23,786,000
10,838,000
35,825,000
108,909,000
20,804,000
16,652,000
19,244,000
21,050,000
149,616,000
Acce12ted
10,389,000
$
1,088,756,000
7,352,000
23,686,.000
8,883,000
30,257,000
28,259,000
18,149,000
9,697,000
19,244,000
12,050,000
43,500,000
$2,414,421,000
$1,300,222,000
~
!/Includes $309,607,000 noncompetitive tenders accepted at the average price of 98.446
§jIncludes $146,229,000 noncompetitive tenders accepted at the average price of 96.850
I!Tbese rates are on a bank discount basis. The equivalent coupon issue yields are
6.33~ for the 91-day bills, and 6.52~ for the 182-day bills.
STATEMENT OF THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
BEFORE THE
HOUSE COMMITTEE ON WAYS AND MEANS
TUESDAY, MAY 20, 1969, 10 A.M.
Mr. Cha irma n, I appear today with Dr. Pau I W. McCracken,
Chairman of the President's Counci I of Economic Advisers,
and Mr. Robert P. Mayo, Director of the Bureau of the Budget,
in support of three of the President's tax recommendations.
First, to extend the income tax surcharge at the
fu II 10-percent rate throughout 1969 and at
5 percent unti I mid-1970;
Second, to postpone the scheduled reductions in excise
taxes on automobi les and telephone services;
and
Third, to repeal the 7-percent investment credit.
The case for these proposals is compel I ing. More than three
years of inflation have distorted our economy, robbed the thrifty
of part of their savings, and el iminated our favorable trade balance.
A continuation of the inflationary boom ultimately is likely to
lead to a sharp contraction in economic activity, accompanied
by a painful level of unemployment. Inflation must be stopped -and it can only be stopped by continued fiscal and monetary restraint.
Federal spending for the coming fiscal year has been cut
back sharply from the levels proposed in January by the preceeding
Administration. Further cuts would imperi I programs vital to
meeting our national needs. In these circumstances, the needed
budgetary surplus requires that we not permit the surcharge to
expire.
An extension of the surcharge would, according to current
estimates, result in Federal budget receipts of $199.2 bi II ion
in fiscal 1970. With spending reduced to $192.9 bi" ion, the
result would be a surplus of $6.3 bi II ion. Given the size of
the inflation problem, that surplus would be none too large. But
fai lure to extend the surcharge and excises would convert the
surplus to a deficit.
Mr. Chairman, I would now like to turn to Mr. Mayo, who
wi I I discuss the budget s i tuat i on, and then to Dr. McCracken,
who wi I I present the economic case for the President's
K-96
- 2 -
tax proposals. Fol lowing these statements I would like to discuss
the proposed repeal of the 7-percent investment credit and to make
some concluding remarks .
... ... ........ . . . .. . . . ...... .. .. . . .. . .. . ... . .. . .. . . .. . . . .. . . . . ...
Mr. Chairman, the President is committed to removal of the
surtax just as soon as economic and mi litary conditions permit.
However, it is possible at this time to recommend a halving of
the surtax as of January I, 1970.
Such a reduction in the surtax, bringing some measure of
re lief to a I I income taxpayers, wou Id be poss i b Ie on Iy because
of the proposed elimination of the 7-percent investment tax credit.
The revenue lost from reduction of the surcharge would almost
exactly offset the revenue gained from repeal of the credit.
Although el imination of the credit would help curtai I the
demand for business equipment -- and thus rei ieve inflationary
pressures -- that is not the only reason for suggesting its removal.
This subsidy to business investment ranks below other pressing
national needs.
The revenues released by repeal of the credit can be used -beginning in fiscal year 1971 -- to help fund the Administration's
forthcoming programs, including revenue-sharing with State and
local governments, and tax credits to encourage investment in
poverty areas and hiring and training of the hardcore unemployed.
Stated simply, the case for removal of the investment credit
rests primari Iy upon the fact that the social needs and economic
conditions of the 1970's wi II be greatly different from those
of a decade ago. Stimulation of a sluggish rate of business investment
was a high priority goal in the early 1960's. Since that time,
business has put close to $400 bi I I ion into new plant and equipment.
Even without the credit, a high rate of investment is expected
to continue because the fundamental incentive to invest -- good
prospective markets for industry's products -- is likely to remain
strong. Instead of inducing sti I I more business investment, additional
resou rces wi I I be ava i Iab Ie to meet press i ng needs for hous i ng,
to aid State and local governments, and to improve the lot of
the poor.
- 3 -
Mr. Chairman, let me conclude by discussing briefly
three of the arguments that have been advanced against extension
of the surcharge.
First, there are a few who argue that the degree of fiscal
and monetary restraint is now too great, and that extension of
the surcharge risks economic overki". The data now avai lable
refute this view. The sl ight abatement in the pace of advance,
although gratifying, is surely not sufficient to justify relaxation
of our efforts at this time. What we are seeking in this legislation
is not to turn the anti-inflation screw another notch, but to
retain approximately the budget position we have now achieved.
Indeed, as Dr. McCracken pointed out, fai lure to extend the surcharge
would significantly boost the inflationary expectations that
now pervade the economy.
Second, there are those who argue that enactment of the
surcharge fai led to cool the economy last year and wi I I fai I
again this year. Dr. McCracken has also met this argument.
Our tax program must be viewed as part of a co-ordinated approach,
and with this legislation fiscal and monetary pol icies wi I I remain
properly synchronized. Fai lure to extend the surcharge would
shift too much of the burden to monetary pol icy, with the unhappy
prospect of even higher interest rates and tighter credit conditions
than now prevai I.
Finally, there are those who argue that extension of the
surcharge shou I d be postponed unti I a conprehens i ve tax reform
bi I I has been reported out of this Committee.
The Administration is fully committed to achieving significant
tax reform at the earl iest possible date. We made a substantial
down payment on this commitment by presenting to the Committee,
after only three months in office, a comprehensive set of tax
reform proposals of major substantive significance. They are
not simply proposals of the Treasury or of its staff. They were
studied carefully in the White House. They enjoy the ful I support
of the President.
We recognize that additional tax reform proposals are needed.
Further recommendations are now being prepared by the Treasury.
The initial package, however, should be a convincing demonstration
of the depth and strength of this Administration's commitment
to far-reaching and meaningful reform.
Whatever package of tax reforms Congress enacts this year
can be balanced so as to be consistent with the budget position
establ ished by the measures under consideration today. The Administration
reform proposa lis ba Ianced in that way.
- 4 Linking tax reform with the problem of restoring economic
stab iii ty through f i sca I respons i b iii ty and restra i nt can on Iy
jeopardize both goals.
I therefore urge the Committee to formally act upon the
President's proposals promptly to extend the surcharge and excises
and to repeal the investment credit. Any protracted period of
uncerta i nty about the f i sca I p"1 an of the government wi I I strengthen
the inflationary expectations with which we now contend and complicate
seriously the problem of monetary management, and undermine confidence
at home and abroad in our wi I I and abi I ity to maintain a stable dollar.
In acting promptly on the President's recommendation, we
shal I demonstrate that we can face up to our fiscal responsibi I ities
and mount an effective program to halt inflation.
At this point, I am submitting a supplementary statement,
which includes a general explanation of the provisions relating
to the surcharge, investment credit repeal, and the excise taxes,
a technical explanation of those proposed tax changes, and a
proposed Bi I I.
000
SUPPLEMENTARY STATEMENT OF
THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
PRESENTED TO THE
HOUSE COMMITTEE ON WAYS AND MEANS
TUESDAY, MAY 20, 1969, 10 A.M.
The attached material, submitted at hearings before the House
Ways and Means Committee by Secretary of the Treasury David M. Kennedy,
includes the fol lowing items:
A general explanation of the provisions relating to the
surcharge extension, the repeal of the investment tax credit,
and the postponement of reductions in excise tax rates on
automobiles and telephone service.
Tables are included showing:
(1)
the revenue consequences of the surcharge extension
and investment credit repeal;
(2)
the changes in tax 1 iabil ity for individuals and
famil ies resulting from the proposed surcharge extension
for 1969 and 1970.
A technical explanation of the provisions relating to the
surcharge extension and the investment credit repeal;
A copy of a draft bill to extend the surcharge and the excise
taxes on automobi les and telephone service, and to repeal the
investment tax credit.
Attachments
K-96
GENERAL EXPLANATION
I.
I n Gene ra I .
The President's proposal would amend provisions relating
to the surcharge, the investment
credi~
and the excise taxes on
automobiles and telephone service.
The surcharge would be extended at the rate of 10 percent for
1969.
Under present law the surcharge rate for 1969 is 5 percent,
representing a surcharge of 10 percent for half the year from
January I, 1969, to June 30, 1969.
Under the proposed extension
most taxpayers wil I pay this surcharge through withholding rates about
10 percent above the regular rates until December 31, 1969.
The surcharge would be enacted at a rate of 2-1/2 percent for
1970, to be paid by most taxpayers through withholding at rates
5 percent above the regular rates until June 30, 1970.
This wil I
represent a reduction in the withholding rate from 10 percent to
5 percent in January.
Under the proposal the surcharge would expire after June 30, 1970,
and withholding rates would be restored to their basic levels at that
time.
In addition, the investment credit would be repealed with respect
to property constructed or acquired after Apri I 20, 1969, except for
property on which construction had begun or which had been contracted
for by that date.
- 2 -
The present schedule of reductions in the excise tax rates on
automobiles and on telephone service beginning January 1, 1970, would
be extended for an additional year.
On this basis the automobile tax
would drop from 7 percent to 5 percent on January 1, 1971, and the
telephone tax would drop from 10 percent to 5 percent on January 1, 1971.
The other reductions now scheduled will each take place one year later.
This program wi 1 1 produce approximately the same revenue through
fiscal year 1970 as would have been provided by the extension of the
surcharge at 10 percent through June 1970 as proposed by the previous
Administration.
Since repeal of the investment credit would be permanent,
the revenue after June 1970 will be substantially higher under this
program than it would be under present law.
The revenue details are
set out in Table 1.
11.
The Proposal in Detai 1.
A.
The Surcharge.
The President's proposal contemplates
continuation of present withholding rates, as recommended by the previous
Administration, until December 31, 1969.
The extra withholding would
then be reduced in half from January 1, 1970, through June 30, 1970,
when the surcharge would expire.
In all other respects the surcharge
would be continued as it has been in operation for the past year.
B.
Excise Tax on Automobiles and Telephone Service.
The
continuation of the excise rates on automobiles and telephones at
present levels also is required by the budget situation.
At the current
(j
- 3 time the demand for automobiles as well as telephone service is
strong, and continuation of the present excise will not be burdensome
on either industry.
Under the proposal, the reductions in these excise
tax rates will be deferred for one year.
In the case of both the surcharge and the excise extension, prompt
passage is important.
If the rates are permitted to lapse temporarily
due to fai lure of the bill to be enacted before July 1, there will be
difficult conditions facing employers, particularly in having to change
their withholding schedules on July 1, and again when the surcharge is
enacted.
Moreover, if there were a time gap between July 1 and the
date of enactment, either withholding would have to be set at a higher
rate for the balance of 1969 or additional tax would have to be paid
by employees on filing their final 1969 returns in April 1970.
C.
The Investment Credit.
The terms of repeal of the
investment credit should include a rule that assets acquired pursuant to
a binding contract executed on or before April 20, 1969 -- that is,
before the President's announcement -- would qual ify for the credit.
Contracts entered into after that date would not qual ify for the credit.
For these purposes a contract would be considered binding if, under the
appl icable local law, the taxpayer is legally bound to perform.
In
addition, specific property on which construction began prior to April 21
would qual ify for the credit.
- 4These rules will achieve the most equitable results
in that
those who commenced construction of property or legally bound themselves to
acquire property in reI iance on the credit wil I receive the benefit of the
credit for such property.
On the other hand, those who committed themselves
after the President's Message on April 21, 1969, will not receive a
benefit at the expense of other taxpayers.
We emphasize that any
change in the proposed cut-off date or transition rules could not
only seriously affect the revenue impact of repeal, requiring
reconsideration of the extent of the surcharge reduction, but could
also discriminate unfairly between those who did and those who did
not act with regard to the President's Message.
The situation with respect to the present proposal for repeal
of the credit differs from that involved in the temporary suspension
that was enacted in 1966.
In the case of the temporary suspension
a special equity problem existed because construction going on during
the suspension would in the future compete with projects built after
the suspension that would qual ift for the credit.
credit, future investors wil I not have the credit.
In a repeal of the
Thus fairness requires
that the lawaI low no credit to particular future investments unless
they were acquired pursuant to contracts that were binding on
April 20, 1969.
- 5 Fair provisions should also be made with respect to existing
unused investment credit carryovers.
Under present law taxpayers are
allowed to carry forward for seven years any amount of investment
credit in excess of the statutory limitation of $25,000 plus 50 percent
of their tax 1 iabil ity above $25,000 for the year.
By the end of
1968 taxpayers held an estimated $2 bill ion of such unused credits and
some equitable disposition of these credits is necessary when the
investment credit is repealed.
It is proposed that taxpayers be allowed
to carry forward and take as credits against their income tax liabilities
for years ending after April 20, 1969, as much of their unexpired
unused credits from prior years as they would have been able to claim
in the event the investment credit had not been repealed.
Under this provision, taxpayers would compute for each year ending
after April 20, 1969, a simulated tentative investment tax credit based
upon the cost of all property put in service during that year that would
have qual ified for the credit but for repeal.
This simulated credit
plus the credit available for property acquired pursuant to a binding
contract entered into prior to April 21, 1969, or property the construction
of which was commenced before that date (both of which may be referred
to as pre-repeal property) would then be compared to the taxpayer1s
limitation on the credit ($25,000 plus 50 percent of the tax in excess
of $25,000).
If the total were less than the limitation, the full credit
for pre-repeal property would be al lowed, and any unused investment credit
carryover would be al lowed to the extent of the difference between the 1 imitation,
- 6 reduced by the credit allowed for pre-repeal property, and the
simulated credit.
If the total were more than the 1 imitation, the
credit for pre-repeal property would be allowed on a pro rata basis,
and any remaining unused credit on the pre-repeal property would be
added to the taxpayer's unused carryovers to be carried over to
subsequent years.
Of course, if there were no credit for pre-repeal property, the
carryover would be al lowed to the full extent of the excess of the
limitation over the simulated credit.
This system provides a fair allowance for both unused credit
carryovers and credits for pre-repeal property.
As stated, this system
results in allowance of the credit for both pre-repeal property and
for unused carryovers to the same extent as would have been al lowed
if the credit had not been repealed.
It is considerably fairer than
the 1966 suspension period rules which first reduced the limitation by
the full amount of the simulated credit, resulting in many cases of
complete denial of the credit for property acquired pursuant to binding
contracts entered into prior to the suspension.
Our proposed simulated
credit approach el iminates this inequity.
This method has the added advantage of providing an incentive to
taxpayers to defer expenditures on qual ified property and thus generally
to strengthen the Administration's anti-inflation program.
By deferring
- 7 such expenditures, there will be a smaller simulated credit, and
unused carryovers can be util ized to a greater extent.
In addition, the proposal contains a rule to protect property
which is purchased after repeal as a replacement for property on
which the credit has previously been claimed but which is destroyed
by casualty or is stolen.
To the extent the property is replaced,
there would be no reduction of benefit from the credit through either
recapture or the simulated credit.
A final topic related to the investment credit repeal is the issue
of exceptions.
The situation regarding repeal is different from that
involved in 1966 under temporary suspension.
Under a temporary suspension
there was reason to allow small business to have the credit on assets
acquired during the suspension period because they would be competing
in the future with large companies that would get the credit on investment
after the suspension.
To provide permanently that small business should
get the credit would introduce a discrimination that may be unwise.
A
decision to favor small business by some minimum credit would, for example,
need to be compared with other techniques for deal ing with small business,
such as the additional first-year depreciation allowance in Section 179
of the Code; and it would have to be allowed under I imitations so that it
could not be enjoyed on a mUltiple basis by chains of corporations.
- 8 Further, continuation of an investment credit with a dollar
I imitation would not be an efficient way to help smal I business.
The large bulk of small business is in the retail and wholesale
trade I ines where much of their investment must be in inventories
and receivables.
Where a smal I business does involve a heavy
investment in assets that would be covered by the investment credit,
this typically occurs early in the business life when the credit is
apt to be very large relative to the tax and is thus apt to be largely
wasted.
An investment credit I imited in dollar amount is I ikely to be
a far less viable assistance to new business than government efforts
to make loans available to new and small firms.
Other recommendations have been made to preserve the investment
credit for particular kinds of assets, such as airplanes or railroad
freight cars.
This would be a very unwise decision to make in the
context of the present repeal legislation.
This would be a complete chang,
in the character of the investment credit from an across-the-board
encouragement to equipment investment in general to a special ized
subsidy to certain investments in certain industries.
The Congress
should not decide to preserve a discriminatory credit for, say,
airplanes without studying this as a specific problem in transportation
pol icy.
Whether an airplane investment should get a special
assistance not available to other assets would need to be studied in
terms of more detailed investigation of the national interest involved
and the total relationship of the Federal Government to the industry.
- 9 We have argued for several years that there should be additional
charges on airway users for the free services government already
provides.
Further, it does not appear desirable for the Congress to provide
a credit permanently for special categories of investment, such as
investment in anti-pollution equipment, by simply excluding them from
the proposed repeal.
Legislation regarding such equipment should be
separately considered on its own merits, and if tax credits are to be
used in some degree to achieve these objectives, they should be specially
designed to achieve their intended purpose without undue revenue loss.
In many situations the appropriate business response may not be in new
investment.
It may, for example, be in the form of incurring extra costs
for a desulfurized fuel.
It may not be advisable to introduce a
Federal subsidy for anti-pollution investments but not for other
anti-pollution costs.
These are matters to which the present Administration
is giving careful attention at the present time.
If the Congress sees fit to modify this proposal as to repeal
of the investment credit by creating exceptions or 1 iberal izing the
terms of the repeal, so as to significantly reduce the revenue expected
in the fiscal year 1970, a smaller reduction of the surcharge in 1970
would be necessary.
Attachments
000
Increase in Revenue from ExtensionafSurcharge atJO Percent to December 3~, ~969
and at 5 Percent to June 30, 1970 Combined with Repeal of Investment Credit
Compared with Increase from Extension of Surcharge at 10 Percent to June 30,. 1970
.
-------------- _
~ _________ ($ billions)
Fiscal Year 1970
Fiscal Year 1971
: Individual: Corporation: Total : Individual: Corporation: Total
A. Extend surcharge at 10 percent to December 31, 1969 and at 5 percent to
June 30, 1970; repeal investment credit effective April 20, 1969
......
5.6
2.0
7.6
0.4
0.8
1.2
credit.~
0.4
1.1
1.5
0.6
~
........................
2.3
.-
6.0
3.1
9.1
1.0
3.1
4.1"
Increase from extension of surcharge
Increase from repeal of investment
Total increase
B. Extend surcharge at 10 percent to June 30, 1970
Increase from extension of surcharge ••••••
Increase
(+),
decrease (-),
A over
Of'f ice of the Secretary oi~ the Treasury
Office of Tax Analysis
B •••
B
2.3
~
Q:.2.
hl
2.4
-1.2
+0.8
-0.4
+0.1
+1.6
+1.7
=
=
~.ay 20~969-
~
~
1/
Table 2
Comparison of Tax Liabilities Under
Proposed Surcharge Change
y
Single Individual
Wage
income
$ 1,000
1968
tax
$
g/
1969
tax
16 $
l/
Change
from 1968
16
$ 0
$
16
Change
from 1969
$
0
1,900
147
147
0
147
0
2,000
166
167
1
164
-3
3,000
358
366
8
341
-25
5,000
721
738
17
688
-50
7,500
1,256
1,285
29
1,197
-88
10,000
1,873
1,916
43
1,786
-130
12,500
2,578
2,638
60
2,458
-180
15,000
3,391
3,469
78
3,233
-236
20,000
5,287
5,410
123
5,041
-369
25,000
7,506
7,680
174
7,157
-523
35,000
12,499
12,790
291
11,918
-872
Office of the Secretary of the Treasury
Office of Tax Analysis
Note:
1970
tax 4/
May 20, 1969
There is no surcharge for a single person whose regular tax
is less than $145.
Tax liabilities aSSllme minimum standard deduction or deductions
equal to 10 percent of income whichever is greater. Tax liabilities
from optional tax table where income is under $5,000.
gj Includes 10 percent tax surcharge effective from April 1, 1968 to
December 31, 1968 (i.e., 7-1/2 percent for calendar year). Surcharge
liability from tables contained in the Revenue and Expenditure Control
Act of 1968.
1/ Includes 10 percent tax surcharge proposed for full year. Surcharge
liability computed as 10 percent of adjusted tax, but not to exceed
20 percent of adjusted tax in excess of $145 for single returns and
$290 for joint returns.
~ Includes 5 percent surcharge proposed for one-half year, effective
from January 1, 1970 to June 30, 1970 (i.e., 2-1/2 percent for
calendar year). Surcharge liability from proposed surcharge tables
for 1970.
Y
1
L-
Table 3
Comparison of Tax Liabilities Under
Proposed Surcharge Change
!I
Married Couple, No Dependents
Wage
income
$ 2,000
1968
tax gj
$
58
1969
tax 1/
$
Change
from 1968
58
0
$
58
Change
from 1)69
$
0
3,000
204
204
0
204
0
3,600
295
295
°
294
-1
5,000
533
543
10
512
-31
7,500
983
1,005
22
937
-68
10,000
1,443
1,476
33
1,376
-100
12,500
1,968
2,014
46
1,877
-137
15,000
2,510
2,,)09
58
2,393
-175
20,000
3,745
3,832
87
3,571
-261
25,000
5,156
5,276
120
4,916
-360
35,000
8,597
8,797
200
8,197
-600
Office of the Secretary of the Treasury
Office of Tax Analysis
Note:
$
1970
tax ~
May 20, 1969
There is no surcharge for a married COUV]c whose regular tax
is less tnan ~290.
Tax liabilities aSSLUne minimum standard deduction or deductions
equal to 10 percent of income whichever is greater. Tax liabilities
from optional tax table where income is under $5,000.
~/ Includes 10 percent tax surcharge effective from April 1, 1968 to
December 31, 1968 (i.e., 7-1/2 percent for calendar year). Surcharge
liability from tables contained in the Revenue and Expenditure Control
Act of 1968.
1/ Includes 10 percent
tax surcharge proposed for full year. Surcharge
liability computed as 10 percent of adjusted tax, but not to exceed
20 percent of adjusted tax in excess of $145 for single returns and
$290 for joint returns.
~/ Includes 5 percent surcharge proposed for one-half year, effective
from January 1, 1970 to June 30, 1970 (i.e., 2-1/2 percent for
calendar yearl Surcharge liability from proposed surcharge tables
for 1970.
Y
Table it
Comparison of Tax Liabilities Under
Proposed Surcharge Change
!I
Married Couple, Two Dependents
Wage
income
$ 3,000
1968
tax
$
?J
1969
tax ]/
4
$
4
Change
from 1968
$
11
~
4
0
290
290
0
290
0
7,500
737
755
18
703
-52
10,000
1,198
1,225
27
1,142
-83
12,500
1,685
1,724
39
1,606
-118
15,000
2,217
2,268
51
2,114
-154
20,000
3,397
3,476
79
3,239
-237
25,000
4,743
4,853
110
4,522
-331
35,000
8,094
8,282
188
7,717
-565
Note:
gj
$
Change
from 1969
5,000
Office of the Secretary of the Treasury
Office of Tax Analysis
!I
0
1970
tax 4/
May 20,1969
There is no surcharge for a married couple whose regular tax
is less than $2~0.
Tax liabilities assume minimum standard ded'lction or deductions
equal to 10 percent of income whichever is greater. Tax liabilities
from optional tax table where income is under $5,000.
Includes 10 percent tax surcharge effective from April 1, 1968 to
December 31, 1968 (i.e., 7-1/2 percent for calendar year). Surcharge
liability from tables contained in the Revenue and Expenditure Control
Act of 1968.
Includes 10 percent tax surcharge proposed for full year. Surcharge
liabili ty computed as 10 percent of adjusted tax, but not to exceed
20 percent of adjusted tax in excess of $145 for
single returns and
$290 for joint returns.
Includes 5 percent surcharge proposed for one-half year, effective
from January 1, 1970 to June 30, 1970 (i.e., 2-1/2 percent for
calendar year). Surcharge liability from proposed surcharge tables
for 1970.
Technical Explanation
Revenue Act of 1969
Section 1.
Short Title, Etc.
Section l(a) of the bill provides that the bill, when enacted
may be cited as the "Revenue Act of 1969".
Section
l(b) of the bill provides that, except as otherwise expressly provided, whenever an amendment or repeal is expressed in terms of an
amendment to, or repeal of, a section or other provision, the reference is to be considered to be made to a section or other provision of the Internal Revenue Code of 1954.
Section 2.
(a)
Extension of Tax Surcharge.
Surcharge extension.--Section 2(a) of the bill provides for
the extension of the tax surcharge until June 30, 1970.
charge is currently scheduled to expire to June 30, 1969.
The tax surUnder the
bill, che surcharge rate on an annual basis for the period beginning
July 1, 1969, and ending December 31, 1969, would be the present rate
of 10 percent.
The surcharge rate on an annual basis for the period
beginning January 1, 1970, and ending June 30, 1970, would be 2 1/2
percent.
Subsection (a)(l) amends section 51(a)(1)(A) of the Code by
deleting the existing tax tables applicable to individuals whose
- 2 -
taxable year is the calendar year 1969 (which tables are based upon
an annual rate of 5 percent) and inserting new tax tables for calendar
year 1969 (based upon an annual rate of 10 percent) and for calendar
year 1970 (based upon an annual rate of 2.5 percent).
Subsection (a)(2) amends section 51(a)(1)(B) of the Code
by revising the annual surcharge rate schedule for calendar year
taxpayers other than individuals (i.e., estates, trusts, and corporations).
As revised, the schedule would provide an annuaI rate
of 10 percent for 1969 and 2.5 percent for 1970.
Paragraphs (3) and (4) of section 2(a) amend section 51~,a)
(2)(A) of the Code to modify the method of computing the amount of
tax surcharge for fiscal year taxpayers.
Under existing law, a 10
percent surcharge is multiplied by a fraction, the numerator of which
is the number of days in the taxable year which are within the surcharge period, and the denominator of which is the total number of
days within the taxable year.
Paragraph (3) of section 2(a) of the bill would amend section 51
(a)(2)(A) of the Code to extend its application to taxable years beginning before July 1, 1970, in accordance with the extension of the
tax surcharge.
Paragraph
(4)
would amend section 51(a)(2)(A)(ii) to
provide that, in computing the numerator of the fraction described in
- 3 -
the preceding paragraph, only one-half of the number of the days in the
taxable year occurring in the first six
are to be taken into account.
months of calendar year 1970
This adjustment corresponds to the
reduction of the annual surcharge rate from 10 percent to 2.5 percent.
This computation may be illustrated by the following example:
Example.
An individual's adjusted tax is $10,000 for his tax-
able year beginning September 1, 1969, and ending August 31, 1970.
The amount of surcharge is $582.19, computed as follows:
Step 1.
10 percent of adjusted tax
Step 2.
Computation of fraction
$ 1,000
Number of days in taxable year before
January 1, 1970
122
One-half times number of days in taxable year after December 31, 1969 and
before July 1, 1970 (1/2 x 181)
Total (numerator of fraction)
212.5
Denominator of fraction
Fraction
Step 3.
Amount of surcharge (10 percent of
adjusted tax times fraction)
$
582.19
- 4 (b) Estimated tax.--Section 2(b) of the bill provides special
rules for the payment of additional amounts of estimated income tax
occasioned by the extension of the tax surcharge.
In general, any
amount by which the taxpayer's estimated income tax (taking into account the extension of the tax surcharge) exceeds the estimated tax
originally determined is to be paid ratably on each of the installment
dates remaining in the taxable year beginning with the first installment date on or after the 30th
day after enactment of the bill.
The full amount of the increase of estimated tax must be reflected
ratably in the taxpayer's remaining installment payments.
Thus, for
example, assume that a calendar-year corporation initially determined an
estimated tax of $10,500 and made payments of $2,625 on April 15 and
June 15.
If the taxpayer determines that, because of the extension of
the tax surcharge, the estimated tax is $11,000, the $500 difference
should be paid in two installments of $250 each on September 15 and
December 15, along with the payments of $2,625 due on those dates.
(c)
Conforming amendments.--Section 2(c) of the bill amends
section 963(b) of the Code to provide that, for the purposes of that
section, the termflsurcharge periodflmeans the period beginning January 1, 1968, and ending June 30, 1910.
7~
,r
- 5-
Section 2(d) of the bill makes conforming amendments to the
withholding provisions of the Code.
Paragraph (1) amends section
3402(a) of the Code to extend until December 31, 1969, the applicability of the tables based on an annual surcharge rate of 10 percent for the percentage method of withholding on wages and to add
tables based on an annual surcharge rate of 5 percent, which would
apply for the first six months of 1970.
Paragraph (2) amends sec-
tion 3402(c)(6) of the Code to extend for an additional year the
authority granted therein to the Secretary or his delegate to prescribe wage-bracket withholding tables to be used while the tax
surcharge is in effect.
The tables applicable during calendar year
1969 would.be based on an annual surcharge rate of 10 percent and
tables applicable during the first six months of calendar year 1970
would be based on an annual surcharge rate of 5 percent.
(d)
Effective date.--Section 2(e) of the bill provides that the
amendments made by section 2 shall be effective July 1, 1969.
Section 3.
(a)
Continuation of Excise Taxes on Communications Services
and on Automobiles.
In general.--Section 3 of the bill delays the scheduled
reduction of the excise tax on communication services and automobiles
for one year.
It makes no amendments to these provisions other than
- 6 those necessary to delay such scheduled reduction.
(b)
Passenger automobiles.--The excise tax on passenger auto-
mobiles (imposed on the manufacturer's price) is 7 percent prior to
January 1, 1970.
Under existing law on that date the rate is to begin
a gradual reduction, to
5 percent during 1970, to 3 percent during
1971, to 1 percent during 1972 respectively, and a repeal of the remaining 1 percent tax for 1973.
Section 3(a) of the bill amends sec-
tion 4061(a)(2)(A) (relating to tax on passenger automobiles) and
makes other necessary conforming amendments to delay such scheduled
reduction of excise tax on passenger automobiles for one year.
Under
this amendment the new schedule is as follows:
If the article is sold--
The tax rate is--
........................
During 1971 ·...............................
During 1972 ·...............................
During 1973 ·...............................
Before Jan. 1, 1971
(c)
7 percent
5 percent
3 percent
1 percent
Communication services.--The excise tax on amounts paid for
local and toll telephone and teletypewriter exchange service is 10
percent prior to January 1, 1970.
On that date the rate, under exist-
ing law, is to begin a gradual reduction
to 5 percent during 1970, to
3 percent during 1971, to 1 percent during 1972, and repeal of the remaining 1 percent for 1973.
Section 3(b) of the bill amends section
425l(a)(2) (relating to tax on certain communications) and makes other
necessary conforming amendments to delay the scheduled reduction for
77
- 7 one year.
Under this amendment the new schedule is as follows:
Amounts paid pursuant to
bills first rendered--
Percent
Before Jan. 1, 1971 ............................ .
10
·................................... .
During 1972 ·................................... .
3
During 1973
1
During 1971
Section
(a)
•
••••••••••••••••• 0
••••••••••••••••••
5
4. Repeal of Investment Credit.
In general.--Section 38 of the Internal Revenue Code of 1954
provides a 7 percent tax credit with respect to "qualified investment"
in section 38 property.
However, in the case of section 38 property
which is public utility property, the credit is limited to 3 percent
of the qualified investment.
Section 38 property includes, in general, tangible personal property, certain other tangible property (not including a building and
its structural components), and elevators and escalators.
The term
includes only property with respect to which depreciation (or amortization in lieu of depreciation) is allowable and which has a useful
life of four years or more.
Qualified investment is investment in either new or, to a limited
extent ($50,000 for each taxable year), used section 38 property.
If
such property has an estimated useful life of from four to six years,
the qualified investment is one-third of the investment in such property.
If the estimated useful life is six to eight years, the qualified investment is two-thirds of such investment; and if the estimated useful life
- 8 is eight years or more, the entire investment in such property
qualifies.
The amount of the investment credit allowed for a taxable year
may not exceed the first $25,000 of liability for tax plus 50 percent
of the excess thereof.
Credits which are unused as a result of this
limitation may be carried back to the three prior taxable years and
then carried forward to the succeeding seven taxable years.
(b)
Repeal of Investment Credit.
(1)
In general.--Section
4 (a) of the bill would add a new
subsection (k) to section 48 (relating to definitions; special rules).
Paragraph (1) of the new subsection would provide that section 38
property does not include property the physical construction, reconstruction, or erection of which is begun after April 20, 1969, or
which is acquired by the taxpayer after that date.
The determination
of when physical construction, reconstruction, or erection of property
is begun would be made under the same rules employed when the investment credit was suspended by Public Law 89-800.
(2)
Binding contracts.--Paragraph (2) of the new subsection
provides that paragraph (1) does not apply to any property to the
extent that it is constructed, reconstructed, erected, or acquired
pursuant to a contract which was on April 20, 1969, and at all times
thereafter, binding on the taxpayer.
The investment credit suspension
rules under section 48 (h) (~), relating to binding contracts, would
7S
- 9 be applied to determine what constitutes a contract binding on the
taxpayer.
(3)
Taxable years ending after April 20, 1969.--Under section
46 (a) (2), relating to the limitation based on amount of tax, the
amount of investment credit allowed by section 38 for any taxable
year may not exceed the first $25,000 of liability for tax plus 50
percent of the excess thereof.
Section 4 (b) (1) would amend sec-
tion 46 (a) by adding a new paragraph (6) to provide that the amount
otherwise determined under section 46 (a) (2) for any taxable year
ending after April 20, 1969, must be reduced by an amount equal to
the lesser of:
(i) the credit which would have been allowable under
section 46 (a) (1) for such taxable year with respect to any property
but for the application of section 48 (k) (1), or (ii) an amount
which bears the same ratio to the amount otherwise determined under
section 46 (a) (2) as the amount described in (i) bears to the sum
of such amount so described plus the credit which is allowable for
such taxable year under section 46 (a) (1).
The manner of computing the limitation based on amount of the
tax under the above rule is illustrated by the following examples:
Example (1).
Corporation X, a calendar year taxpayer, has a
liability for tax for 1970 of $25,000.
During 1970, X places in
service a lathe which is section 38 property because it was acquired
pursuant to a binding contract which was on April 20, 1969, and at
all times thereafter binding on the taxpayer and a machine press
which is not section 38 property because of the application of
- 10 section 48 (k) (1).
X's credit earned with respect to the lathe
is $10,000 and its credit earned with respect to the machine press
would have been $40,000.
Under the rule described above, X's credit
allowed for 1970 is limited to $5,000 since the limitation otherwise
determined under section 46 (a) (2), $25,000, is reduced by $20,000
to $5,000.
The reduction is the lesser of:
(i) $40,000 (the credit
X would have earned with respect to the machine press), or (ii) $20,000
($25,000 multiplied by
$40,000
).
$40,000 plus $10,000
Under section 46 (b)
(1),
X's unused credit for 1970 is $5,000, that is $10,000 (X's credit
earned for 1970) less $5,000 (the portion of the $10,000 credit allowed
for 1970).
Exampl~.
Assume the same facts as in example (1), except
that the credit earned with respect to the machine press would have
been $2,500 but for the application of section 48 (k) (1).
Under the
new rule, X's entire $10,000 credit earned in 1970 would be allowed
for 1970 since the limitation of $25,000 would only be reduced to
$22,500.
The amount of the reduction is the lesser of:
(i) $2,500,
or (ii) $5,000 ($25,000 multiplied by
$2,500
). Under
$2,500 plus $10,000
section 46 (b), the amount of any of XiS unused credits from other
taxable years which are allowable in 1970 is $12,500, that is,
$22,500 (X's recomputed limitation based on amount of tax for 1970)
less $10,000 (X's credit earned in 1970).
Section 4 (b) (2) of the bill would amend section 48 (d) to provide that in the case of property which would be section 38 property
7,
- 11 but for the application of section 48 (k) (1) and which is leased
and is property of a kind which the lessor ordinarily leases to one
lessee for a substantial portion of the useful life of the property,
the lessor of the property shall be deemed to have elected to treat
the first such lessee as having acquired such property for purposes
of applying section
46 (a) (6).
The proposal also provides that in
the case of section 38 property which (i) is leased after April 20,
1969 (other than pursuant to a binding contract to lease entered
into before April 21, 1969), (ii) is not property to which section
48 (k) (1) applies with respect to the lessor but is property to
which section 48 (k) (1) would apply if acquired by the lessee, and
(iii) is property of the same kind which the lessor ordinarily sold
to customers before April 21, 1969, or ordinarily leased before such
date and made an election under section 48 (d), the lessor of such
property shall be deemed to have made an election under section 48 (d)
with respect to such property.
- 12 -
(4)
Replacement of Eroperty destroyed by casualty.--The pro-
posal would amend section
47 (a) (4), relating to investment credit
recapture in the case of property destroyed by casualty, etc., to
provide that, in general, if property ("replacement property")
which would be section 38 property but for repeal of the investment
credit is placed in service by the taxpayer to replace the property
so destroyed ("casualty property"), then such casualty property shall
be treated as ceasing to be section 38 property only to the extent
that the basis (or cost) which had been taken into account in computing its Qualified investment exceeds the cost of construction,
reconstruction, erection, or aCQuisition of such replacement property.
To the extent that the casualty property is not treated as having
ceased to be section 38 property with respect to the taxpayer, such
replacement property shall be treated for purposes of recapture under
section
47 as if it were the casualty property and it had not been
destroyed; thus, there will be no recapture on such casualty property
to the extent replaced, but the replacement property will be subject
to recapture if later disposed of.
Furthermore, for purposes of
applying section 46 (a) (6), the replacement property will be
treated as not being section 38 property to the extent that the
Qualified investment in the casualty property has been replaced;
thus, to such extent, the replacement property will generate no
simulated credit.
- 13 The application of the new rules may be illustrated by the
following example:
Example (i).
Corporation X, a calendar year taxpayer, acquires
and places in service on January 1, 1968, a machine with a basis of
$300 and an estimated useful life of 8 years.
For 1968 X is allowed
a $21.00 investment credit under section 38 with respect to the
machine.
On January 1, 1970, the machine is destroyed by fire.
On
such date, X acquires a new machine for $200 and places it in service
to replace the machine destroyed.
Under the proposal, the destroyed
machine, only to the extent of $100 ($300 less $200) of its original
basis, would be treated as ceasing to be section 38 property and
of the investment credit allowed would be recaptured.
$7
The new
machine would be treated, to the extent of the remaining $200 of
original basis of the destroyed machine, as if it were the destroyed
machine for the purpose of making any future recapture determination.
(ii)
For purposes of applying section 46 (a) (6), the $200
new machine would not be treated as section 38 property.
Thus, the
purchase of the new machine will not generate any simulated credit
for purposes of section
(iii)
46 (a) (6).
If X had acquired the new machine in (i) for $400 instead
of $200, no portion of the $21.00 investment credit allowed to X
would have been recaptured, and for purposes of applying section
46 (a) (6), the new machine to the extent of $100 of its basis
- 14 ($400 cost less $300 original basis of destroyed machine) would be
treated as property which would be section 38 property but for the
application of section 48 (k) (1).
Thus, $100 will have to be
taken into account in determining the simulated credit under section
46 (a) (6).
(c)
Effective date.--The amendments made by the proposal will
apply to taxable years ending after April 20, 1969.
A BILL
To extend the tax surcharge and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1.
SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the "Revenue Act
of 1969".
(b) Amendment of Existing Law.--Except as otherwise expressly
provided, whenever in this Act an amendment is expressed in terms of
an amendment to a section or other provision, the reference shall be
considered to be made to a section or other provision of the Internal
Revenue Code of 1954.
SEC
0
2.
EXTENSION OF TAX SURCHARGE.
(a) Surcharge Extension.--Section 51 (a) (relating to imposition
of tax surcharge) is amended-(1)
by striking out so much of paragraph (l)(A) as follows
the table heading "CALENDAR YEAR 1969" and inserting in lieu
thereof the following:
- 2 -
TABLE
l.--Single person (other than head of household) and married
persons filing separate return
If the adjusted tax is:
If the adjusted tax is:
At least
But less
than
The tax
is--
0
$ 148
153
158
163
168
173
178
183
188
193
198
203
208
213
218
223
228
233
238
243
248
253
258
263
268
273
278
283
288
295
305
315
325
335
345
355
$ 148
153
158
163
168
173
178
183
188
193
198
203
208
213
218
223
228
233
238
243
248
253
258
263
268
273
278
283
288
295
305
315
325
335
345
355
365
0
$ 1
2
3
4
5
6
7
8
365
375
37
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
At least
$ 375
385
395
405
415
425
435
~h5
455
465
4~5
4 5
495
505
515
525
535
545
555
565
575
585
595
605
615
625
635
645
655
665
675
685
695
705
715
725
735
But less
than
The tax
is--
$ 38
$ 385
395
39
40
405
41
415
42
425
43
435
44
445
455
45
46
465
47
475
48
485
49
495
50
505
51
515
52
525
53
535
54
545
55
555
56
565
575
57
58
585
595
59
60
605
61
615
62
625
63
635
64
645
65
655
66
665
67
675
68
685
69
695
70
705
71
715
725
72
735
73
and over, 10% of the adjusted
tax
- 3 -
TABLE 2.--Head of household
If the adjusted tax is:
At least
But less
than
If the adjusted tax is:
The tax
is--
0
$ 223
228
233
238
243
248
253
258
263
268
273
278
283
288
293
298
303
308
313
318
323
328
333
338
343
348
353
358
363
368
373
378
383
388
393
398
$ 223
228
233
238
243
253
258
263
268
273
278
283
288
293
298
303
308
313
318
323
328
333
338
343
348
353
358
363
368
373
378
383
388
393
398
403
0
$ 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
403
408
37
2~~8
At least
But less
than
The tax
is--
$ 408
$ 413
$ 38
418
413
39
418
40
423
428
41
423
428
42
433
438
43
433
44
438
445
445
45
455
46
465
455
47
465
475
48
485
475
485
49
495
50
495
505
51
515
505
52
525
515
525
53
535
54
535
545
545
555
55
56
565
555
565
57
575
58
585
575
585
59
595
60
605
595
61
615
605
62
615
625
63
625
635
64
645
635
65
645
655
66
665
655
67
665
675
68
685
675
69
685
695
70
705
695
71
715
705
72
725
715
73
725
735
735 and over, 10% of the adjusted
tax
- 4-
TABLE
3.--Married persons or surviving spouse filing joint return
If the adjusted tax is:
If the adjusted tax is:
At least
0
$ 293
293
303
308
313
318
323
323
333
333
343
348
353
358
363
363
373
378
383
388
393
393
1+03
1~<),3
413
418
,'+23
428
33
438
1;-1+ 3
41-1-8
}-I-53
45i3
463
468
473
But less
than
$ 293
298
3')3
308
313
318
323
3.23
333
338
3)+3
348
353
358
363
363
373
373
383
388
393
393
40~
40
/.;.13
1+l8
423
11-28
\
'~'"')
Lj j - '
1;-38
443
It-I!
1
653
458
i-l-h3
)+-68
473
478
The tax
At least
is-0
$ 1
2
3
4
5
6
7
8
9
10
11
12
13
14
~5
16
17
18
19
20
21
'J?
23
24
25
26
27
28
29
30
31
32
33
34
") ::~
J/
36
37
$ 478
483
488
49~
493
5:)3
508
513
518
523
528
533
533
543
548
553
558
563
563
5'(3
5i8
585
595
605
But less
than
$ 483
488
1+93
498
503
508
513
518
523
528
533
538
51~ 3
548
553
558
563
563
573
S (3
65')
585
595
(;05
615
625
635
645
655
" ..
665
675
675
685
~~5
625
635
645
635
695
705
715
725
735
':),
The tax
is--
$ 33
39
4J
41
42
43
44
45
46
47
48
49
50
5l
52
53
5)+
55
56
57
5,8
59
60
61
62
63
64
65
'
))
,.). I
67
68
0)5
69
705
70
715
71
'(2
'{25
735
73
and over, 10% of the adjusted
tax
- 5 CALENDAR YEAR 1970
TABLE
1.--Single person (other than head of household) and married
persons filing separate return
If the adjusted tax is:
If the adjusted tax is:
At least
But less
than
The tax
is--
0
$ 155
175
195
215
235
255
275
300
340
$ 155
175
195
;:15
235
255
275
300
340
380
0
$ 1
2
3
4
5
6
7
8
9
At least
But less
than
The tax
is- ..
$ 10
$ 380
$ 420
420
11
460
460
12
500
540
500
13
14
540
580
620
580
15
660
16
620
660
700
17
18
740
700
740 and over 2.5% of the adjusted
tax
- 6 -
TABLE
2.--Head of household
If the adjusted tax is:
If the adjusted tax is:
At least
0
$ 230
250
270
290
310
330
350
37'0
390
But less
that
$ 230
250
270
290
310
330
350
370
390
410
The tax
is-0
1
$
2
3
4
5
6
7
8
9
At least
$ 410
430
460
500
540
580
620
660
700
740
But less
than
The tax
is--
$ 10
460
11
12
500
540
13
14
580
620
15
660
16
700
17
18
740
and over, 2.5% of the adjusted
tax
$ 430
- 7 -
TABLE
3.--Married persons or surviving spouse filing joint return
If the adjusted tax is:
If the adjusted tax is:
At least
0
$ 300
320
340
360
380
400
420
440
460
But less
than
The tax
is--
$ 300
320
340
3?)0
380
400
420
440
460
480
0
$1
2
3
4
5
6
7
8
9
At least
But less
than
The tax
is--
$ 480
$ 500
$ 10
11
500
520
12
540
520
540
560
13
14
560
580
620
15
580
16
660
620
660
17
700
18
740
700
over,
2.5%
of
the
adjusted
740 and
tax
- 8(2) oy striking out the tao1e in paragraph (1)
(B) and
inserting in lieu thereof the following tao1e:
Percent
IICa1endar Year
1968
1969
1970
Estates and Trusts
·.................
·.................
·.................
Corporations
7·5
10.0
10.0
.10.0
2.5
2.5
(3) oy striking out IIJuly 1, 1969" the first time it appears
in paragraph (2) (A) and inserting in lieu thereof "July 1, 1970",
and
(4) oy striking out paragraph (2) (A) (ii) and inserting in
lieu thereof the following:
II (ii) a fraction, the numerator of which is the sum of
the numoer of days in the taxaole year occuring on
and after the effective date of the surcharge and Defore
January 1, 1970, plus one-half times the numoer of days in
the taxaole year occurring after December 31, 1969, and before July 1, 1970, and the denominator of which is the numoer of days in the entire taxable year. 1I
(b)
Estimated Tax.--If any taxpayer is required to make a de-
claration or amended declaration of estimated tax, or to pay any amount
or additional amount of estimated tax by reason of the amendments made
by this section, such amount or additional amount shall be paid ratably
on each of the remaining installment dates for the taxable year
beginni~
- 9 with the first installment date on or after the 30th day after the date
of enactment of this Act.
For purposes of this subsection, the term
ninstallment daten means any date on which, under section 6153 or 6154
(whichever is applicable), an installment payment of estimated tax is
required to be made by the taxpayer.
(c) Technical Amendment.--Section 963 (b) (relating to receipt of
minimum distributions by domestic corporations) is amended by striking
out "June 30, 1969", and inserting in lieu thereof nJune 30, 1970".
(d) Withholding on Wages.-(1) Percentage method of withholding.--Section 3402 (a) (relating to requirements of withholding) is amended-(A) by striking out "June 30, 1969" in paragraph (1)
and inserting in lieu thereof "June 30, 1970";
(B) by striking out "July 1, 1969" in paragraph (2)
and inserting in lieu thereof "January 1, 1970"; and
(C) by adding at the end thereof the following:
"(3) In the case of wages paid after December 31, 1969, and
before July 1, 1970:
- 9a [Set forth below are proposed withholding tables for an annual payroll period.
Withholding tables for other payroll periods are being prepared, and will be
made public when complete.]
'Table 7--If the payroll period with respect to an employee is
ANNUAL
n(a) Single Person--Including Head of Household:
If the amount of wages is:
Not over $200 •••••••••••••••••••
Over $200 but not over $700 ••••••
Over $700 but not over $1200 •••••
Over $1200 but not over $4400 ••••
Over $4400 but not over $8800 ••••
Over $8800 but not over $11000 •••
Over $11000 ••••••••••••••••••••••
l1(b)
The amount of income tax to be withheld
shall be:
o
14% of excess over $200
$70 plus 15% of excess over $700
$145 plus 18% of excess over $1200
$721 plus 21% of excess over $4400
$1645 plus 26% of excess over $8800
$2217 plus 31% of excess over $11000
Married Person:
If the amount of wages is:
Not over $200 ••••••••••••••••••••
Over $200 but not over $1200 •••••
Over $1200 but not over $3000 ••••
Over $3000 but not over $8800 ••••
Over $8800 but not over $17700 •••
Over $17700 but not over $22000 ••
Over $22000 •••.••••.•••••••••••••
The amount of income tax to be withheld
shall be:
o
14% of excess over $200
$140 plus 15% of excess over $1200
$410 plus 18% of excess over $3000
$1454 plus 21% of excess over $8800
$3323 plus 26% of excess over $17700
$4441 plus 31% of excess over $22000
- 10 -
(2)
Wage bracket withholding -- Section 3402(c)(6) is amended-(A)
by striking out "July 1, 1969", and inserting in
lieu thereof "July 1, 1970", and
(B)
by striking out "subsection (a)(2)." and inserting
in lieu thereof "subsection (a)(2) in the case of wages paid
before January 1, 1970, and on the basis of table 7 contained
in sl).bsection (a)(3) in the case of wages paid after December 31,
1969." .
(e)
Effective Date.--The amendments made by this section shall apply
as of July 1, 1969.
SEC. 3.
CONTDruATION OF EXCISE TAXES ON COMMUNICATION SERVICES AND ON
AUTOMOBILES.
(a)
Passenger Automobiles.-(1)
In general.--Section 4061 (a)(2)(A)(relating to tax on
passenger automobiles, etc.) is amended to read as follows:
"(A)
Articles enumerated in subparagraph (B) are taxable
at whichever of the following rates is applicable:
If the article
is sold - -
The tax rate is--
Before Jan. 1, 1971 ••••••••••••••.••••
7 percent
During 1971 ••••••.•••••••••••••••••••
5 percent
Thlring 1972 ••••••••••••••••••••••••••
3 percent
Thlring 1973 ••••••••••••••••••••••••••
1 percent
The tax imposed by this subsection shall not apply with respect
to articles enumerated in subparagraph (B) which are sold by the
- 11 -
manufacturer, producer, or importer after December 31, 1973.
(2)
11
Conforming amendment.--Section 6412 (a)(l)(relating to floor
stocks refunds on passenger automobiles, etc.) is amended by striking
out "January 1, 1970, January 1, 1971, January 1, 1972, or January
1, 1973", and inserting in lIeu thereof "January 1, 1971, January
1, 1972, January 1, 1973, or January 1, 1974".
(b)
Communications Services.-(1)
Continuation of tax.--Section 4251(a)(2)(relating to tax
on certain communications services) is amended by deleting the
table and inserting in lieu thereof the following table:
"Amuunts paid pursuant to
bills first rendered--
Percent--
Before Jan. 1, 1971 ••••••••••••••••
10
·...................... .
During 1972 ·...................... .
During 1973 ·...................... .
During 1971
(2)
5
3
1",
Conforming amendment.--Section 4251(b)(relating to termi-
nation of tax) is amended by striking out "January 1, 1973", and
inserting in lieu thereof "January 1, 1974".
(3)
Repeal of subchapter B of chapter 33.--
Section 105(b)(3) of the Revenue and Expenditure Control Act of
1968 (82 Stat. 266) is amended to read as follows:
"(3)
Repeal of Subchapter B of Chapter 33.--
Effective with respect to amounts paid pursuant to bills first
rendered on or after January 1, 1974, subchapter B of chapter 33
(relating to the tax on communications) is repealed.
For purposes
- 12 -
of the preceding sentence, in the case of communications services
rendered before November 1, 1973, for which a bill has not been
rendered before January 1, 1974, a bill shall be treated as having
been first rendered on December 31, 1973.
Effective January 1,
1974, the table of subchapters for chapter 33 is amended by striking
out the item relating tv such subchapter B
(c)
Effective Date.--The amendments made by this section shall take
effect as of the date of enactment of this Act.
SEC. 4.
(a)
REPEAL OF INVESTMENT CREDIT.
Termination.--Section
48 is amended by redesignating subsec-
tion (k) as subsection (1) and by inserting before such subsection the
following new subsection:
n(k)
Termination of Investment Credit.-n(l)
General rule.--For purposes of this subpart,
the term 'section 38 property' does not include property-"(A)
the physical construction, reconstruction,
or erection of which is begun after April 20, 1969, or
nCB)
which is acquired by the taxpayer after
April 20, 1969.
n(2)
Binding contracts.--Paragraph (1) shall not
apply to any property to the extent that such property is
constructed, reconstructed, erected, or acquired pursuant
to a contract which was, on April 20, 1969, and at all times
thereafter, binding on the taxpayer."
-13 (b)
Transition Rules.-(1)
Determination of amount of credit.--Section 46(a) (relating
to determination of amount of credit) is amended by adding at the
end thereof the following new paragraph:
"(6)
Taxable years ending after April 20, 1969. --The
amount otherwise determined under paragraph (2) for any
taxable year ending after April 20, 1969, shall be reduced
by
al~
amount equal to the lesser of-"(A)
the credit which would have been allowable
under paragraph (1) for such taxable year with
respect to any property but for the application of
section 48 (k) (1), or
"(B)
an amount which bears the same ratio to
the amount otherwise determined under paragraph (2)
as the amount described in subparagraph (A) bears
to the sum of such amount so described plus the credit
which is allowable under paragraph (1) for such taxable
year."
(2)
Leased propertY.--Section 48 (d) (relating to certain
leased property) is amended by adding at the end thereof the
following new sentences:
"In the case of property which would be
section 38 property but for the application of subsection (k) (1)
and which is leased and is property of a kind which the lessor
ordinarily leases to one lessee for a substantial portion of the
- 14 useful life of the property, the lessor of the property shall be
deemed to have elected to treat the first such lessee as having
acquired such property for purposes of applying section 46 (a) (6).
In the case of section 38 property which is leased after April 20,
1969 (other than pursuant to a binding contract to lease entered
into before April 21, 1969), which is not property to which
subsection (k) (1) applies with respect to the lessor but is
property to which subsection (k) (1) would apply if acquired by the
lessee, and which is property of the same kind which the lessor
ordinarily sold to customers before April 21, 1969, or ordinarily
leased before such date and made an election under this subsection,
the lessor of such property shall be deemed to have made an election
under this subsection with respect to such property."
(3)
Property destroyed by casualty, etc.--Section 47 (a) (4)
(relating to property destroyed by casualty, etc.) is amended by
adding at the end thereof the following sentences:
"If property
(hereinafter in this paragraph referred to as 'replacement
property') which would be section 38 property but for the application of section 48 (k) (1) is placed in service by the taxpayer
to replace property described in subparagraph (A) (hereinafter
in this paragraph referred to as 'casualty property'), then
for purposes of paragraphs (1) and (3) such casualty property
shall be treated as ceasing to be section 38 property only to the
extent that the basis (or cost) taken into account in computing
- 15 its qualified investment exceeds the cost of construction, reconstruction, erection, or acquisition of such replacement property.
To the extent that the casualty property is not treated as having
ceased to be section 38 property with respect to the taxpayer,
such replacement property shall be treated (i) for purposes of
this section as if it were the casualty property and the event
described in subparagraph (A) had not occurred, and (ii) for
purposes of applying section 46 (a) (6) as if it were not section
38 property."
(c)
Effective Date.--The amendments made by this section shall
apply to taxable years ending after April 20, 1969.
T REASURY DEPARTMENT
WASHINGTON. D.C.
May 21, 1969
:FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasur-y Department, by
for- two series of Treasury bills
$3,000,000,000, or thereabouts,
Tr-easur-y bills matur-ing May 29,
$3,002,261,000,
as follows:
this public notice, invites tenders
to the aggl-egate amollnt uf
for- cash and in exchange for1969,
in the amount of
91-day bills (to matur-ity date) to be issued May 29, 1969,
in the amount of $1,700,000,000,
or- ther-eabouts, r-epr-esenting an
:ldditional amount of bills dated Fehruary 27, 1969,
and to
natur-e
August 28, 1969, or-iginally issued in the amount of
'?1.100,827,000,
the additional and original bills to be
freely inter-changeable.
183-day bills, for $1,300,000,000,
iated
May 29, 1969,
and to matur-e
or ther-eabouts, to be
November 28, 1969.
The bills of both ser-ies will be issued on a discount basis unoer
'ompetitive and noncompetive bidding as her-einafter- provided, and at
latur-ity their- face amount will be rayable without inter-est. They
lill be issuerl in bear-er- for-m only, and in denominations of $1,000,
;5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
:matur-i ty value).
Tender-s will be r-eceived at Feder-al Reserve Banks and Br-anches
tp to the closing hour-, one-thir-ty p.m., Eastern Daylight Saving
inc,
Monday, May 26, 1969.
Tenders will not be
eccived at the Treasur-y Department, Washington. Each tender must
c for- an even mUltiple of $1,000, and in the case of competitive
enders the price offer-ed must be expressed on the basis of 100,
ith not more than three decimals, e. g., 99.925. Fractions may not
e used. It is urged that tenders be made on the printed forms and
or-warded in the special envelopes which will be supplied by Federal
eserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for- account of
ustomers provided the names of the customers are set for-th in such
enders. Others than banking institutions will not be permitted to
ubmit tender-s except for their own account. Tenders will be r-eceived
ithout deposit from incorporated banks and trust companies and fr-om
K-97
- 'L -
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announce.
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on May 29, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
May 29, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or. interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For. purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
fo
TREASURY DEPARTMENT
'.~~~~~~~~~~~~~~~
WASHINGTON. D.C.
May 21, 1969
FOR IMMEDIATE RELEASE
TREASURY'S MONTHLY BILL OFFERING
The Treasury Department, by
for two series of Treasury bills
$1,500,000,000, or thereabouts,
Treasury bills maturing May 31,
$1,703,200,000,
as follows:
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
1969,
in the amount of
27l-day bills (to maturity date) to be issued
June 2, 1969,
in the amount of $500,000,000,
or thereabouts, representing an
additional amount of bills dated February 28, 1969,
and to
mature February 28, 1970, originally issued in the amount of
$1,000,376,000,
the additional and original bills to be
freely interchangeable.
365-day bills, for $1,000,000,000,
dated May 31, 1969,
and to mature
or thereabouts, to be
May 31, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Tuesday, May 27, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925.
Fractions may not
be used.
(Notwithstanding the fact that the one-year bills will run
for 365 days, the discount rate will be computed on a bank discount
basis of 360 days, as is currently the practice on all issues of
Treasury bills.)
It is urged that tenders be made on the printed
forms and forwarded tn the special envelopes which will be supplied
by Federal Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
K-98
- 2 -
submit tendeLs except fOL theiL own account. TendeLs will be received
without deposit fLom incorporated banks and tLUSt companies and from
Lesponsible and Lecognized dealers in investment secuLities. Tenders
fLom otheLs must be accompanied by pa.yment of '2 peLcent of the face
amount of TLeasuLY bills applied fOL, unless tLe tendeLs are
accompanied by an expLess guaLanty of payment by an incoLpoLated bank
OL tLUSt company.
Immediately afteL the closing houL, tendeLs will be opened at
the FedeLal ReseLve Banks and BLanches, following which public announce.
ment will be made by the TLeasuLY DepaLtment of the amount and price
Lange of accepted bids. Those submitting tendeLs will be advised
of the acceptance OL Lej ection theLeof. The Secre taLY of the
TLeasury expLessly LeseLves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on June 2, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
May 31, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
TREASURY DEPARTMENT
~
. I
Washington
FOR IMMEDIATE RELEASE
EXCERPTS OF REMARKS OF EUGENE T. ROSSIDES
ASSISTANT SECRETARY OF THE TREASURY
BEFORE THE MEMBERS OF
ROTARY CLUB OF WASHINGTON, D. C.
WASHINGTON HOTEL
May 21, 1969
12:00 NOON
It is a privilege and pleasure for me to be
here today, representing the new Administration, to
join with you in honoring the men and women of the
Treasury Department's Bureau of Customs on its
180th Anniversary.
On behalf of the 9,000 persons
in the oldest of the Treasury's component bureaus,
I thank you for this public-spirited dedication.
I bring you the personal greetings of the
Secretary of the Treasury, The Honorable David M.
Kennedy, who has asked me to express his appreciation
for this tribute by the business community of
Washington to one of the great Bureaus of the Government.
In the early days of his Administration, President
Nixon visited each of the Departments of Government.
his visit to the Treasury, the President stated that
K-99
In
2
what makes the Treasury Department. distinctive is:
"that it really serves the whole Government."
" ... without leadership at the Treasury, nothing
else is going to work.
I think that is one of
the reasons why there has always been a special
spirit in the Treasury."
The President could just as well have been talking
solely about the Bureau of Customs.
Customs serves
the whole Government, carries out missions for many
other Departments.
It has unique functions with
wide responsibilities--and I should add that it returns
$30 for each dollar it spends.
In celebrating the l80th Anniversary of the
Customs Service, we should reflect for a moment on
its history.
The Customs Service is one of the oldest agencies
of Government, actually predating the Treasury Department,
and has frequently been described as "a child that is
older than its parent."
Customs mirrors the Treasury Department in two of
its most important functions:
and law enforcement.
collection of revenues
3
customs collections of duties bring in the second
highest total of revenues to the Federal Government,
second only to the collections of the Internal
Revenue Service.
Customs collections in its early years averaged
two to three million dollars annually.
Despite gradual
reductions in overall duty rates during the past
35 years, Customs revenue today is over three billion
dollars.
This reflects the phenomenal growth of
international trade.
How many persons realize that for a century and
a quarter--from 1789 to 1913, when the Internal Revenue
Code was enacted--this Government was run primarily
on the revenues collected by the Customs Service.
The income tax, of course, is the major source
now of revenues which permit the government to perform
the necessary functions for the people.
And our tax
structure, which has become a hodge-podge of regulations
and rules, is in need of reform.
Realizing the need, the Treasury, at the
direction of the President, is proposing immediate
4
substantial tax reforms.
These proposals are now before the House Ways
and Means Committee.
The objective is to provide
an equalization of the tax impact without endangering
collections of revenues.
Among our proposals is a
low income allowance program which would exempt
five million people below the poverty level from
payment of any income taxes and a limit on tax
preferences which would assure payment of taxes by
many wealthy people who now escape taxation through
provisions of existing law.
In addition, we
propose substantive reforms in more than a dozen
other areas.
Treasury policy makers realize, as does most
everyone, that more comprehensive reforms are needed.
At the direction of the President, the Treasury tax
division is already in the midst of a thorough-going
study of an overall reform and plans to announce
further recommendations later.
Taxes have such an impact on the economy and
affect so many people that we feel that it would be
less than fair to the American people if this
5
Administration did not take the time necessary to
thoroughly study the implications of each reform
proposal.
The Administration also is asking the Congress
to repeal the 7 percent investment tax credit for plant
and equipment expansion and to phase out the income
tax surcharge.
We propose that the 10 percent rate
be extended only until the end of this calendar year
and that the rate be reduced next January 1 to
5 percent until mid-year.
A reduction in the surtax will bring a measure
of relief to all tax payers and elimination of the
investment tax credit will have a salutary effect
on our efforts to get inflation under control by
reducing capital spending.
As Treasury Secretary Kennedy said:
"In acting
promptly on the President's recommendation, we shall
demonstrate that we can face up to our fiscal
responsibilities and mount an effective program to
halt inflation."
My responsibilities at the Treasury include
supervision of the Bureau of Customs and all law
enforcement activities.
6
Treasury 1S the second largest-law enforcement
Department in the Federal Government, and the
Customs Bureau carries a major share of the Treasury's
law enforcement responsibilities.
The Customs enforcement effort is to protect the
revenue and the health and welfare of the nation.
It
has the responsibility to prevent the smuggling of
goods into the United states.
This is a huge
responsibility and one which the Customs Service has,
even with its limited manpower, performed commendably.
This Administration is reviewing each of the
operations of Government to see where and how they can
be improved.
This is one of the major functions of a
change in Administration in our political system.
President Nixon is taking a particular interest in
this and has directed each of his Cabinet officers to
review the operations of his Department.
He has also
established a high-level Committee to review the
overall operations of Government.
One of the areas that the President has asked
be given particular attention is law enforcement.
Secretary Kennedy has directed me to give the highest
7
priority to our support of the various law enforcement
arms of the Treasury Department.
Particular stress
is to be placed on the anti-smuggling drive against
narcotics, marihuana and other dangerous drugs.
Following the Presidential directive, we at the
Treasury have formed a special narcotics section in
the Customs Agency Service, the investigative arm of
the Customs Bureau.
We have iniUated a special
training program for the Customs inspectors, the men
who inspect travelers' baggage coming into the
country.
This training program gives them the
benefit of techniques that are particularly useful
in spotting narcotics, marihuana and other contraband
goods.
A staff assistant in my office is specializing
in the area of anti-smuggling activities.
This anti-smuggling effort is the first line of
defense in preventing the invasion of contraband drugs.
There is an urgent need for an expanded antismuggling effort.
Practically all of the illicit
narcotics and high potency marihuana consumed within
the United States originate abroad and are smuggled
into the United States.
The techniques and mechanics
8
for the suppression of smuggling are well known.
There is no magic formula we have to discover.
The keys are an adequate number of trained men
and proper facilities and equipment.
The President
stressed this point in his speech at Anaheim,
California, on September 16, 1968, when he called for
a substantial increase in Treasury Customs Agents
for an expanded effort to prevent smuggling of
narcotics, marihuana and other dangerous drugs.
The matter of additional Customs enforcement
manpower is under active review in the Treasury, and
we will be making recommendations shortly to the
White House.
Let me give you an example of the type of
effort
that is necessary in this work.
It demonstrates
the dedication and perseverance of our Customs Agents.
You may recall in early March of this year that
Treasury Customs Agents seized over 115 pounds of
heroin in two related seizures.
This was one of the
three or four largest hauls in the history of smuggling.
The two Treasury Customs Agents responsible for this
investigation were Edward T. Coyne and Albert W. Seeley.
9
This case was a year and a half in the making.
During
this period, approximately twenty couriers were arrested.
Treasury Agents Coyne and Seeley developed a
reliable informant and through the normal techniques
of criminal investigation over a period of several
months, they patiently collected the facts with skill
and intelligence.
They traced this huge shipment of
heroin in paella fish cans from France and Spain to
the docks of New York and from there to a transfer
point in a private home in Whitestone, Queens.
During the operation in early March, 1969, I
personally visited the command site in Queens, New
York, where the field operations were being coordinated.
President Nixon has emphasized his personal
interest in the work and efforts of the career staff
of the Federal Government.
During his visits to
the various departments of government, he stressed
his conviction that his Administration will rise or
fall not just on his leadership and that of his
Cabinet officers, but on the leadership and dedication
of the career staff up and down the line.
The
efforts of Treasury Customs Agents Coyne and Seeley
10
are outstanding examples of superior and distinguished
achievement by the career service.
The partnership within Government--between the
national administration and the career personnel-is essential for a successful national administration.
The key word, in my judgment, is partnership.
It is
a question of working together to accomplish the
enormous tasks of government.
It is not an understatement to say that the
efforts and dedication of the 9,000 men and women
of the Customs Service are essential to the success
of this Administration.
~ ~ -~TREASURY DEPAR"flv1E:I\JT
0Y':-c
i ::':,z!l
!
,~=""''''~== ""'~~="""'~'-'""~:.:c.~2=~:::'==,C:2 \
~
"' j'---' -.~)
WASHINGTON, D.C.
l·Il~Y
'OR ]j.ll·12DIATE REI.E.ASE
The
Tre~suTy &nn~u~ced
today
cert~in
21, 1%::-)
tabul~tion
revisions in the
------------------------.-..
of
s~)scription~
-~-----------------------~-----.-
,J :) f
----------.~-----".---- ~
P.:~: 0 'J.il t
Eli~i:.,~~
,-; /8 , ~ II[:rtes, 3-1969
~I
, -/..1
.-1 2,)
Bonds,
K-IOO
A
Y
t-.. ,277
6-3/c~~)
6-.2../::,)
Sl
, ....
70~":'
v
A.....
;)1,7(9 'J':"
, 4,.:J
- -9t~c;
-
~,
196~-69
_~1~=
-".1
c:.?-r
~ .. I
Total
$ 6,818
$2,330
?
------
---~--------.
; -:: f
-
On:~-
~'")
.
...~- -_.-
$ 825
l.~.~
17
--=::-,~....::::..
C'," 0:,
9GG
33.0
4 /" .3
$2,627 05 ,027
$2.,791
2E.3
27 .6
1
G
"'0
7..
Cl
.-J
TREASURY DEPARTMENT
Washington
FOR A.M. RELEASE
SATURDAY, MAY 24, 1969
REMARKS OF THE HONORABLE CHARLS E. WALKER
UNDER SECRETARY OF THE TREASURY
BEFORE THE
RHODE ISLAND COUNCIL ON ECONOMIC EDUCATION
BROWN UNIVERSITY, PROVIDENCE, RHODE ISLAND
FRIDAY, MAY 23, 1969, 8 P.M., EDT
It is indeed an honor to join you here this evening in
the first of, what I hope, will be a long and successful series
of discussions of major economic issues. The Rhode Island
Council on Economic Education and Brown University are to be
congratulated for this effort to bring pressing economic
problems into a public forum for scrutiny and debateo
I believe it would be appropriate here to make a few
remarks about the Rhode Island Council, one of the most
recently established in the country. I know the academic
community here has been a tremendous source of support of the
Rhode Island Council's efforts. Every college and university
in the state is represented on the Council.
Many
of the state's high schools are also cooperating.
One important task to which your Council is now giving
serious thought is an economic education program for
disadvantaged adults. This is the kind of educational
activity which could reap significant rewards for the people
of Rhode Island. It would also set an example for so many of
the other state Councils.
No discussion about the Rhode Island Council would be
complete without talking about the Warwick school system.
As you know, it has been designated the first cooperating
school system in the state to participate in the
Development Economic Education Project, DEEP. As the first
element of this program, thirty elementary and secondary
teachers are enrolled in an economic edqcation course. The
Rhode Island College Center for Economic Education is
K-lOl
- 2 presenting the course.
Dr. Kenneth Lundberg and
Professor Peter Moore are sharing the teaching responsibilities.
Rhode Island College will grant three hours of graduate credit
to the teachers who successfully complete the course. Three
fourths of the tuition charges for those enrolled was paid by
the Rhode Island Council on Economic Education.
The course has been divided into two main portions. The
first deals with basic economic concepts with emphasis on
explanation, illustration, and classroom application. The
second portion will emphasize the development of grade level
guides for teachers prepared by the course participants. All
reports indicate that the teachers are finding this a most
stimulating and worthwhile experience. Additional plans
include more in-service courses and summer workshops for
teachers as funds become available.
These are just initial steps of what promises to be an
extremely activist State Council. I am heartened by the
progress in such a short period of time, and feel assured that
the Rhode Island Council on Economic Education will be among
the leaders of this most worthy endeavor.
This nation is confronted with a vast array of problems.
At the top of the list are the search for peace abroad and
the control of inflation at homeo
Courageous decisions, carefully arrived at, are
necessary if each of these problems is to be solved. The
President's speech last week concerning Vietnam
told the entire world that we are determined to help bring
a just and lasting peace to Southeast Asia. Earlier, the
President presented another courageous decision to the
American people when he announced the substitution of the
Safeguard ABM system for the Sentinel system. This
decision, yet to be ratified by the Congress, is a wise
choice
in the interest of peace, and it deserves the support
of the American people.
Courageous decisions have also been taken in the fight
against inflation.
Spending has been cut back some $4
billion below the adjusted January budget. Extension
of the surtax has been requested. And the Federal
Reserve authorities have pursued a restrictive monetary
policyo
- 3 Cutting spending, raising taxes, and making money scarce
and expensive are never popular policies. But control of
inflation is an absolute must if we are to be successful in
meeting our other pressing national needs.
Our efforts to
increase the supply of low-income housing are crimped by
spiralling construction costs. Adequate living standards
for the elderly and people on welfare cannot be maintained
if the purchasing power of their limited dollars continues
to shrink. Defense needs are increasingly difficult to
meet -- and the defense budget becomes that much more
difficult to control -- as the prices of materials continue
to rise.
In short, rapid rises in prices are putting tough
obstacles in front of every worthy Government program.
But inflation, once set in motion is extremely difficult
to contain without severe disruptions to the economy. This
is because the inflationary expectations which are bred by
long periods of price increases in themselves sow the seeds
of further price increases.
Let me explain what I mean by the impact of "inflationary
expectations":
Businessmen step up their purchases of plant and
equipment in order to "beat" the price rise.
Workers strive for money wage increases that
are large enough to offset rising consumer
prices as well as match productivity gains.
Speculators tend to justify their own expectations
by pushing up prices as they scramble to acquire
commodities and equities.
Economic forecasting is an extremely hazardous occupation
and, although my record has been reasonably good, it has not
been without erroro
Perhaps I am once again wrong in assessing the
current situation and outlook, but I feel that the degree of
fiscal and monetary restraint now being exerted is
appropriate to the state of the economyo
We should soon see
- 4 -
/1(/
some convincing signs of cooling. This would be a significant
indication that we would be well on our way toward gaining
control over inflation.
This will happen provided -- and this is a big proviso
that the Congress acts promptly to extend the income tax
surcharge as requested by the President.
It would indeed be a sad commentary on the application
of sound economic policies in our democracy if, after
waging so long and so hard a battle to gain initial enactment
of the surcharge a year ago, the Congress were now to
let it lapse just when we may be gaining the upper hand in the fight
against inflation. Raising taxes -- or, in this instance,
maintaining the existing level -- is never popular. But
it is necessary if we are not to lose what I believe to be
the fruitful gains of our effortso
Simply stated, rejection of the surcharge extension
would go a long way toward distorting Our carefully
balanced program of restraint o If inflationary pressures
continue at their recent levels, the only alternative would
be a further turn of the screw of monetary restraint. With
interest rates at their highest levels since the Civil War,
such an eventuality is not happy to contemplate.
It is somewhat paradoxical to note Congressional
reluctance to extend the surcharge in the face of continued
skepticism in business and financial circles that our policy
of gradually bringing inflation under control will work.
In part, this so-called "credibility gap" may result from
a misunderstanding of our goals.
Our goal is to eliminate inflationary expectations and
ultimately to halt inflation. But inflation cannot be
stopped in its tracks in 1969 without risking a serious
business slump and a sharp spurt in unemployment.
Consequently, our intermediate goal is to slow inflation
this year, with stability our ultimate goal. This is
a logical policy and there is no reason why it should not
work -- provided, again, that we have the patience to see
it out, and provided that we do not undermine it by
prematurely relaxing fiscal restraint.
- 5 -
If) I
The so-called "credibility gap" may also result in part
from our candor in admitting that absolute stability of the
consumer price index is not a realistic goal. Economists
recognize that this index fails to reflect adequately
increases in the quality of the durable goods that consumers
purchase. Even more important is the fact that rising
consumer affluence and changing tastes can result in a rise
in the index.
For example, as incomes rise, consumers spend more for
such things as recreation, hospital and medical care, and
other services. As such spending shifts, the prices
of services may rise rapidly.
No balanced anti-inflationary
policy could be expected to counter the effects of these
shifts on the consumer price index.
But a well-conceived anti-inflationary program -- such
as the one now in effect -- can be expected to restore
essential balance in the economy and reasonable stability
of less biased price indexes, such as the wholesale price
index. In this respect, it should be recalled that between
1959 and 1965, when consumer prices rose at a rate of 1.3
percent per year, the wholesale price index was relatively stable.
This goal is well within our reach, provided we
maintain the courage to make decisions which, however
unpopular they may be ~n the short run, work for the ultimate
good of the economy and of the people.
Obviously the more understanding of basic economic
concepts the individual has, the better prepared he will be
to make wise and rational choices, either directly or through
his 7epresentatives in Government. That is why I have long
been a strong supporter of the Joint Council on Economic
Education and its growing number of affiliated councils.
About 150 years ago Thomas Jefferson said, "I know of
no safe depository of the ultimate powers of society but the
people themselves; and if we think them not enlightened
enough to exercise their control with a wholesome discretion
the remedy is not to take it from them but to inform their
discretion."
- 6 -
This is what the economic education movement is all
about. Economic problems, along with all other problems
in our society, will be resolved through the normal
democratic process. If we are to expect sound decisions
there is no better way than to make sure the public has some
grasp of the fundamentals of econorr.ics.
So, I therefore . .commend the leadership community of
Rhode Island in their present
ld future -- efforts in
this most vital task of enlisting public support in
understanding economics and in ou-- mutual fight against
inflation.
--j
000
FOR RELEASE ON DELIVERY
(SCHEDULED AT 1:00 P.M.
MONDAY, MAY 26, 1969)
STf.TE}JENT OF THE HONORl.BLE JOHN R. PETTY
t,SSIST1~NT SECRET1.RY OF THE TREI SURY
BEFORE THE
HOUSE COl1MITTEE ON 1 PPROPRI!~TIONS
SUBCOH}UTTEE ON FOHEIGN OPERP.TIONS & REU'TED AGENCIES
ON THE
{PPROPRIi TION OF THE SECOND INSTl.LLMENT OF THE
U. S. CONTRIBUTION TO THE SECOND REPLENISHMENT
OF THE RE SOURCE S OF THE
INTE~Nl.TION1,L DEVELOPMENT fSSOCU.TION
111 Y 26, 19 69
l
t! r
'--(, I \ J (
\
(>
'>
I D
~,
)
-.---~~==--
Mr. Chairman end members of the Committee: I appreciate
this opportunity to appeC1r in bcha If of the f-dministrCltion in
supt)ort of a fisc.?l year 1970 C1ppropriation of $l60 million
for the second of three equCll annual contributions by the United
States of its shere in the second replenishment of the International Development 1-ssociation (IDl), an affiliate of the
Horld Bank.
H.R. 33, which authorizes the U. S. Governor of In! to
Egree on behalf of the United StCltes to contribute $160 million
.?s
our shClre in ench of the yeClrs 1969, 1970, and 1971 was
passed by the House of Representatives on M2rch 12 and by the
Senate on Hay 14.
(Request to Congress - May 20,1969. H.Doc. Sl-117)
Under this replenishment, the 18 economically advanced
member countries of IDi. ..olus Switzerl;;md
~'lill
.Drovide
IDI
with $1.2 billion of additional resources over a three year
period.
Under the terms of the agreement the U. S. contribut ion
for the first yea~ will have to be paid -- in the form o£
K-I02
fl
- 2 -
letter of credit -- within thirty days
effect.
('l
fter the agreement t8.kes
It is therefore necessary for us to be in a positiOLl to
make a prompt first payment on our pledge.
1 request for a
supplemental fiscal 1969 appropriat ion of $160 mill ion vJhich
~vould
enable us to make this first DClyment is presently Dending
before the Congress.
(Senflte Doc. 91-19)
Originally the first installment
WetS
scheduled to be pClid
on November 8, 1968; therefore the need for it is particularly
urgent.
Hithout the replenishment, IDi' s resource s avn ilable
for ne';V credit commitments would soon be exhausted, and the
institution would be forced to suspend its lending operations.
The second installment of the U. S. contribution -- for
~vhich
I [1m testifying today
will have to be paid -- again
in the form of a letter of credit -- on or before November 8
of this year.
The U. S. contribution to the replenishment represents 40
percent of the $1.2 billion total, reflecting a continued decrease
in our share in comparison to the initial subscriptions to IDlof the economically advanced countries in 1960, and their
contributions to the first replenishment in 1964.
In addition, an integral feature of the agreement is an
assurance that if the U. S. so requires, there will be no
- 3 ['c1verse effect of the U. S. contribution on our balance of pClymcnts throu2;h at lenst the end of fiscal yeor 1971.
Under the agreement, if our current pClyments imbalance
persists, ",ve Fill provide in cash until fisc[ll 1972 only that
p:'rL: of our con::.:ribution
~lhich
is
purcbcSsing in tile United States.
e~:pended
for ID] -financed
Furthermore, this Clrrangement
Vlould continue (][ter that until other contributors' shares in
t
his replenishment 2re exhausted.
In other words, the agreement
provides thot c2sh poyments by the United States -- to the extent
required for purchnsin3 in other countries -- will be postponed.
Instead, other countries ""rill accelerate their contributions
durinG this period.
This arrangement would not affect IDf. and
the Horld Bank's traditional system of international competitive
bidding.
The budgetary aspects of our contributions are fully consis tent "'lith the i dministra tion 's efforts to exercise maximum
restraint on total federal expenditures.
Expenditures resulting
from the replenishment vlill be substantially less than the
appropriated
Amolli~t
of $160 million per year over the three year
contribution period, since the annunl U. S. contribution will
be made in the form of a letter of credit which will be
dra~m
upon only as ID: needs cash to meet its disbursements.
CC'lsh
calls on the U. S. contribution will not exceed our pro rata
- 4 share of total calls, and while the U. S. balance of payments
situation requires continuation of the agreed safeguards,
be even less.
~vill
Actual budgetary expenditures during the period
FY 69-FY 71 will therefore be only a fraction of the amolli1ts
appropriated in these years.
Participation in IDA effectively serves the U. S. national
interest.
ID~
stemmed from an American idea and has received
bipartisan support of four Presidents, members of Congress and
many other leaders in 1,merican national life.
primarily at Congressional initiative.
IDA was created
Senate Resolution 264
of 1958 originally suggested its establishment.
President Eisenhower then strongly recommended the formation
of IDI. -- pointing out that, "The well-being of the free world
is vitally affected by the progress of the nations in the less
developed areas.:I
Presidents Kennedy and Johnson encouraged
and approved the subsequent expansion of IDI.' s opera tions.
Now
this replenishment has the full support of President Nixon.
The establishment of Int. in 1960, and the agreement to
provide it with additional and larger resources in 1964, were,
in effect, corrnnitments by other nat ions to a more equitable
sharing of the burden.
The proposed second replenishment
represents additional progress in that direction.
For every
$2 contributed by the U. S. other nations will contribute $3.
- 5 In the eight yenrs since IDl, begun operCltions, several of
the developing countries have made truly impressive
All have advanced.
pro~ress.
Yet ffiClny have advanced only slowly.
The
lives of the ir people re f1ect hunger, s ickne ss and lack of
education.
These nations -- the poorest of the
deve10~ing
world -- urgently require the assistance that ID£ provides.
If
they are to progress, they must hClve access to credit on terms
they can meet -- specificn11y, to credits that can be repaid
on easier terms over a longer period of time.
For these countries
not to have access to IDf credits vlOu1d be self-defeating, because
mounting debt-servicing costs would dr8in away the funds provided,
and required, for economic growth.
I~-
credits are made for a term of 50 years, with repayment
commencing after a 10 year period of grace.
Thereafter one
percent per annum of the principal is repaid for 10 years, and
three percent per annum for the remaining 30 years.
No interest
is charged on the credit but a service charge of 3/4 of one
percent annually is made on amounts disbursed and outstanding
in order to provide IDA with funds to meet its administrative
costs.
ID.t,-contributing countries all share in providing this
concessionary assistance to the developing countries since their
contributions to the institution are made on the same basis.
- 6 is a multilClteral agency, IDi offers imoortant
advClntaoes'
•
b
•
the shClring of financia 1 costs with other industria 1 izecl
countrie s
the objectivity of em international institution
tl.1e or080 and collective experience of its member
nCltions
the Op?o:;:-tunity to exercise leadership in the development
effort.
Iill
is also strengthened by its direct affiliation with
the Horld Bc:mk.
Because it is directed by the same President,
guided by the SClme Board of Directors and Governors, and utilizes
the same expert management and staff, we can be certain that its
funds '\'7ill be expended prudently.
IDi applies the same strict
stcC1nd[1rds of project appraisal and end-use supervision as in the
C2se o~ projects fin~nced by the Bank.
In addition, like the
Bcmk, ID! Hill not lend to countries which are not taking adequ8te
self-help measures and pursuing economic policies conducive to
sound develooment.
Moreover, ID! credits, like the Bank's 10ems,
mus t be repa id in hard currency.
The only fundamenta 1 difference
is that ID! provides funds in cases where the borrowers need more
favorable fore ign currency repayment terms than the Bank can
provide.
- 7 Int. made its first development credit in May 1961.
Through
March 31, 1969 it had extended credits amounting to just over
$2 billion in 47 countries and territories.
billion has been disbursed to date.
I.pproximately $1.5
The two largest borrowers
have been India and Pakistan which have received IDA credits
within the framework of the World Bank consortia organized for
these countries.
Under the second
rep1enish~nt IDf'-
intends,
consistently with its strict performance standards, to achieve
wider geographic diversification in its lending activities.
Up to now most of IDh's funds have gone into transportation
and other basic economic infrastructure.
Recently, however,
increasing emphasis has been given to agricultural and
educ~tional
projects in the
p~oduc
re~lization
that improved agricultural
tivity and trained manpOl'ler are also essential prerequisites of
economic development.
Through ID/- the U.
s.
joins with other nations in a conunon
effort to solve a problem which threatens the peace and well-being
of the \vorld.
This replenishment is an essential step fOr\·mrd
tal-lards greater emphasis on multilateralism and equitable burden
sharing in the field of foreign aid.
Under legislation just
enClcted by the Congress the U. S. Governor has been Cluthorized
to cownit the Uo S. to carry out its share of the agreement.
The
{(O
- 8 a~~~opri~tion
we seek
tod~y,
and the pendin8 supplcmentel fo=
the :-:>resent fiscC'l yenr, will r>ermit the
,
L
u.
S. to :'1.eet that
TREASURY DEPARTMENT
WASHINGTON, D.C.
May 24, 1969
FOR IMMEDIATE RELEASE
K. MARTIN WORTHY TO BE NOMINATED AS
CHIEF COUNSEL FOR INTERNAL REVENUE SERVICE
Secretary of the Treasury David M. Kennedy todav announce~ the
selection of K. Martin Worthy of Bethesda, Md., to be Chief Counsel
for the Internal Revenue Service and Associate General Counsel of
the Treasury.
Mr. Worthy has practiced law and specialized in Federal tax
matters for more than 20 years with the Washington firm of Hamel,
Morgan, Park, and Saunders, of which he is a partner.
He is vicechairman of the Taxation Section of the American Bar Association
and has served as a Council director and chairman of the Bar
Association's committee responsible for government relations.
He
was also a member of the Tax Advisory Group of the American Law
Institute from 1963 to 1968 and in 1957-58.
He will replacR Lester R.
Uretz, who has resigned.
Mr. Worthy, who is 48, is a native of Dawson, Ga.
After attending high schooi in Columbus, ~a., and The Citadel in Charleston, S.C.,
he was graduated from Emorv University, Atlanta, Ga., and the university la~ school.
He then attended the Harvard Universitv Graduate
School of Business, where he was a George F. Baker scholar and received the Master of Business Administration degree cum laude.
He is a co-author of BASIC ESTATE PLANNING, published by BobbsCompany in 1957, and author of articles published in TAXES,
the GEORGIA BAR JOURNAL, INSURANCE LAW JOURNAL, and the proceedings
)f the New York Universitv and Tulane University Tax Institutes.
He
las lectured before the Tax Institutes of the Universitv of Chicago,
~merican University, George Washington University, the University of
fexas, as well as N.Y.U. and Tulane.
~errill
Mr. Worthy was a delegate of the Montgomery County, Md., Civic
from 1951 to 1961 and a member of the District of
~ederation
K-103
/
ATY"T\ '\.
-2Columbia Area Health and Welfare Council in 1960-61. He is a lay
member of the Finance Department of the Episcopal Diocese of
Washington and a director of the National Association of Citadel Me n.
He served in the U.S. Army from 1943 to 1946, rising from
Second Lieutenant to Captain, and a~aln in 1951-52 as a Captain In
the Army Judge Advocate Corps.
Mr. Worthy is married to the former Eleanor Vreeland Blewett
of Newport News, Va.
They have a son and a daughter.
Their home
address is 5305 Portsmouth Road, Bethesda.
000
(
,
i-/
'REASURY DEPARTMENT
WASHINGTON, D.C.
R RELEASE 6: 30 P.M.,
~Y, MAY 26, 1969.
RESULTS OF '1REASURY I S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
l1s, one series to be an additional issue of the bills dated February 27, 1969, and
e other series to be dated May 29, 1969, which were offered on May 21, 1969, were
ened at the Federal Reserve Banks today. Tenders were invited for $1,700,000,000,
'thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 183-day
11s. The details of the "two series are as follows:
.NGE OF ACCEPrED
IMPETITIVE BIDS:
High
Low
Average
91-day Treasury bills
maturing August 28, 1969
Approx. Equiv.
Price
Annual Rate
98.464
6.076~
98.448
6.14Oi
98.452
6.124~
183-day Treasury bills
maturing November 28, 1969
Approx. Equiv.
Annual Rate
Price
96.862 ij
6.173~
96.831
6.234~
96.839
6.218~
];./
Y
a/ Excepting one tender of $' ,450,000
9~
4~
of the amount of 91-day bills bid for at the low price was accepted
of the amount of 183-day bills bid for at the low price was accepted
lTAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Phllade 1phia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
TOTAIS
,'Includes
Includes
Acce;Eted
A;I?E1ied For
$ 15,546,000 $ 15,546,000
1,298,374,000
1,989,864,000
22,491,000
37,491,000
48,063,000
51,176,000
12,130,000
14,185,000
26,031,000
41,553,000
94,089,000
149,613,000
37,400,000
52,455,000
27,219,000
32,374,000
30,977,000
30,978,000
13,372,000
23,377,000
74,978,000
151,621,000
$2,590,233,000
$1,700,670,000
EI
AEE1ied For
$ 3,251,000
1,631,163,000
17,141,000
25,541,000
11,597,000
28,664,000
174,515,000
36,132,000
28,789,000
14,122,000
17,760,000
130,880,000
Acce;Eted
$
3,251,000
1,008,163,000
7,141,000
(;5,541,000
8,797,000
18,314,000
99,315,000
30,432,000
28,289,000
14;122,000
7,760,000
48,880,000
$2,119,555,000
$1,300,005,000
5:./
$297 , 958 , 000 noncompetitive tenders accepted at the average price of 98.452
$143,474,000 noncompetitive tenders accepted at the average price of 96.839
These rates are on a bank discount basis. The equivalent coupon issue yields are
6.3l~ for the 91-day bills, and 6.51~ for the l83-day bills.
FOR IHHEDIATE RELEASE
May 27, 1969
In response to inquiries, the Treasury released
the following statement:
"The Treasury has noted \vith interest the
announcement by the Hays and Neans Committee of
tentative decisions on the subject of tax reform.
These decisions, while preliminary, reflect a
general disposition on the part of the Congress
that the tax system must be made more equitable
and just.
"The Administration Ivholeheartedly sh3res
in this determination.
"The Treasury will continue to work \vith the
Ways and Heans Committee, and the Congress, in
every way possible, to achieve meaningful tax
reform.
Toward this goal, we are hard at work on
a program of more comprehensive reform to be
completed and presented to the Congress at the
earliest: possible
ti~Ee,"
000
EASURY DEPARTMENT
4
Iff
_
WASHINGTON. D.C.
REIEA3E 6: 30 P.M.,
sday, May 27, 1969.
RESULTS OF
TRF~SURYts
MONTHLY BILL
OFF1~ING
'l'he Treasury Department announced that the tenders for t'W,) series of Treasury
1s, ~ne series to be an additional issue of the bills dated February 28, 1969, and
other series to be da"tPd May 31, 1969, whlch 'Were offered on May 21, 1969, were
ned at the Federal Reserve Bunks today. 'l\;nders were invited for $500,00'J,000, or
reabouts, of 271-da,y bills and f:)r $1,008,000,000, or thereabouts, ,)f 365-day bills.
detyils of the two series are as follows:
Gl:; OF ACCEPTED
PETITIV:2; BIDS:
High
Low
Averaf!,e
271-day Treasury bills
maturing February 28, 1970
Approx. Equiv.
Price
Annual Rate
6.25~
6.347~
95. 295
95.222
95.252
6.307cfo
365-day Treasury bills
maturing May 31, 1970
Approx. Equiv.
Price
Annual Rate
6.195~
93.719 ~I
93.597
6.315~
93.643
6.270i
Y
Y
Excepting one tender of $1,878,000
43% of the amount of 271-day bills bid for at the low price was accepted
6'3% of the amount of 365-dny bE Is bid for at the low price was accepted
~L
TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
listrict
laston
:ew York
'hilade lphia
leve1and
iehmond
tlanta
hieago
,to Louis
[inneapolis
aDsas City
lfillas
.aD Francisco
'roTALS
AE121ied For
122,000
<$
1,249,325,000
5,935,000
992,000
286,000
10,515,000
61,503,000
5,010,000
10,330,000
1,990,000
11, 214, oor)
80 l 907,00':)
AcceEted
$
122,000
392,925,000
935,000
992,000
286,000
6,515,000
41,508,000
4,440,000
6,330,000
1,990,000
3,214,000
40Z 907, 000
$1,438,134,000
$
500,164,000
AEl~lied
For
10,415,000
1,556,411,000
12,705,000
2,937,000
1,184,000
16,399,000
88,437,000
7,878,000
20,540,000
4,027,000
11,771,000
81,341,000
$
E/
$1,814,045,000
AcceEted
$
415,000
819,111,000
2,705,000
2,937,000
1,184,000
13,399,000
71,817.000
7,87S,000
20,540,000
4,027,000
4,771,000
51,341,000
$1,000,125,000 ~/
Deludes $14,356,000 noncompetitive tenders accepted at the average price of 95.252
Deludes $39,150,000 noncompetitive tenders accepted at the average price of 93.643
!hese rates are on a bank discount basis. The equivalent coupon issue yields are
,.64~ for the 271-day bills, and 6.68~ for the 365-day bills.
K-104
rREASURY DEPARTMENT
//
WASHINGTON. D.C.
May 28, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$3,000,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing
June 5, 1969,
in the amount of
$3,001,056,000,
as follows:
91-day bills (to maturity date) to be issued June 5, 1969,
in the amount of $1,700,000,000,
or thereabouts, representing an
additional amount of bills dated March 6, 1969,
and to
nature September 4, 1969, originally issued in the amount of
$1,101,060,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $1,300,000,000,
jated
June 5, 1969,
and to mature
or thereabouts, to be
December 4, 1969.
The bills of both series will be issued on a discount basis under
~ompetitive and noncompetive bidding as hereinafter provided, and at
naturity their face amount will be payable without interest. They
vill be issued in bearer form only, and in denominations of $1,000,
?5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturi ty '7a1ue).
Tenders will be received at Federal Reserve Banks and Branches
Ip to the closing hour, one-thirty p.m., Eastern Daylight Saving
:ime,
Monday, June 2, 1969.
Tenders will not be
~eceived at the Treasury Department, Washington.
Each tender must
)e for an even mul tip1e of $1,000, and in the case of competitive
:enders the price offered must be expressed on the basis of 100,
7ith not more than three dec"ima1s, e. g., 99.925. Fractions may not
)e used. It is urged that tenders be made on the printed forms and
:orwarded in the special envelopes which will be supplied by Federal
leserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
ustomers provided the names of the customers are set forth in such
enders. Others than banking institutions will not be permitted to
ubmit tenders except for their own account. Tenders will be received
ithout deposit from incorporated banks and trust companies and from
:-105
-
L.
-
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announce.
ment will be made by the TLeasury Department of the amount and price
range of accepted bids. T-nose submitting tenders will be advised
of the acceptance or rejec _ion thereof. The Secretary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in pa:t, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on June 5, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
June 5, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0bO~ranch.
TRE ..\SURY DEPARTMENT
WASHINGTON. D.C.
May 29, 1969
FOR IMMEDIATE RELEASE
SECRETARY KENNEDY AND MINISTER SCHILLER
TO HOLD INFORMAL DISCUSSIONS ON ECONOMIC MATTERS
Economics Minister Karl Schiller of the Federal
Republic of Germany will arrive in Washington Saturday
and will have informal discussions with Treasury
Secretary David M. Kennedy.
Minister Schiller's visit, planned some time ago,
will be his first meeting with Mr. Kennedy.
Since their
talks will take place on Sunday, Secretary Kennedy will
welcome Minister Schiller at Camp David.
return to Washington Monday.
They will
Their discussions are
expected to cover economic matters of mutual interest
to the United States and Germany.
Minister Schiller will be accompanied by Johan
Schoe11horn, State Secretary of the Ministry of Economics.
000
K-106
TREASURY DEPARTMENT
I17
WASHINGTON. D.C.
May 29, 1969
FOR IMMEDIATE RELEASE
HOWARD A. TURNER, DEPUTY COMMISSIONER OF
BUREAU OF ACCOUNTS,DIES AFTER LONG ILLNESS
Howard A. Turner, Deputy Commissioner in the Bureau of
Accounts, Treasury Department, died at home Wednesday after a
long illness. He was 59.
Mr. Turner, a native of Gardner, Kansas, was graduated in
1934 from Kansas University with summa cum laude and Beta
Gamma Sigma honors. His career in the Federal service began in
July 1935 and was entirely in the Treasury except for four years
of military service during World War II, when he served as
Lt. Commander, U. S. Navy.
Mr. Turner was a leader in the continuing development and
improvement of the Treasury's accounts and financial reports.
During his career, Mr. Turner received many special awards,
including the Treasury Department Meritorious Service Award.
He is survived by his wife, Edna V. Turner. Also
surviving are two brothers, Marvin of Gardner, Kansas,and
Orville of Olathe, Kansas, and two sisters, Mrs. LucilLe
Cordell of Gardner, Kansas, and Mrs. Marguerite Rogers of
Paola, Kansas.
000
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
June 2, 1969
FOR IMMEDIATE RELEASE
JOINT U.S.-GERMAN STATEMENT FOLLOWING MEETING
BETWEEN TREASURY SECRETARY DAVID KENNEDY AND
MINISTER OF ECONOMICS KARL SCHILLER
Secretary of the Treasury David Kennedy and the
Minister of Economics of the Federal Republic of Germany,
Mr. Karl Schiller, concluded their talk at Camp David
today.
Minister Schiller and Secretary Kennedy discussed
economic and financial developments in their two countries
and the progress each natipn is making toward its
principal economic objectives. Secretary Kennedy stressed
in particular the determination of the U.S. Government to
curb inflation and return the economy to a more sustainable
rate of growth.
They also exchanged views on various aspects of the
international monetary system. In particular, they
agreed that the establishment of the Special Drawing Rights
Facility in the International Monetary Fund will be one
important step in the orderly evolution of that system o
Minister Schiller and Secretary Kennedy also agreed
on the importance of continued close cooperation on
international economic and monetary matters.
The Minister's visit was originally scheduled to take
place May 16-17 but was postponed at his request. The
visit was his first opportunity to meet with Secretary
Kennedy and other members of the new Administration.
000
K-107
TREASURY DEPARTMEr~T
\\ ~
JI!'lBI"T$ilf'~-~~~)~..::r;~~~~~~~~
WASHINGTON. D.C.
June 2, 1969
FOR INNED lATE RELEASE
Treasury Secretary David M. Kennedy today
sent the following letter to the Honorable
Wright Patman, Chairman of the House Banking
and Currency Committee:
Attachment
K-108
Dcar Hr. Chairm..'ln:
I shars
ovsr
th~ conc~~n
,...,·,'">1
hi...... .....,;..nh...... 1 '-~\!'--
t~"j,'!>.
. . .....
~
C}.;r;...
c:{pressed in ycnu' tclcgrdL::.1c
p'.,
-i
t. L.!..<..
~l 1 ~rl
. . .0 .....
C <...._
1 i'"__
,-,
r, """f- ........,"' .'~\~
,_. i'l;
v_ ... ,-,
L..1
t-:-'--~"";}
ii.,VL
~-:~
~:"".~.: .... ,,",!,
..... C ..... ,;
l.~r
:, ~.~',~ ;-; ""01. '::!
.,-,
"'\'1.........;"l,... C'~!
L-""";
..- __
~-~,...:'"'
t .. oJ
"
•• _.,
__
C,,, '>\:71.r
"1
L."'~"'.,1
~.
L
-
>'-0
\..,.
~_
r~''''''4r'~
d,.,.,,_·_,
'l)
....
(,J:
.;.1..
-1-," -,7
....., ",:
i"'~''''''
_) .. :,
. "1 "'. ...)
-, t
1.-...
-: ,L..I...
~
~'11""""~'- '").
·..J_,./.':_',~it
O·~:
.;.
'D.'""
..,.
1"'1
.... r<:.
~.I....
1".:.;
0~·'4-'''-··r..
.I .._.::",4c • ..Li!"':'
inf l~l t i(:-rl. :C t~ "-7 i S :.:~ ;)r t:: -~:~. t :C . .~.:- --~ : ,:. ~-l tl~ ,': t: t:.~~ ~~ ;.\(:.'.~l:~"Cl i D t.r -2 ti.(, ,.1
.,.., ....
1·~;7ij
r:::'~;,-,ft.r'--·::-I'\f'"
r........... -.,.-...."·";i··q,,...-~·;1 .. ·,y';·-',.,":,-.
"'!7··~_ ......
....-~ur'
.... _,.l -~.:":l.~~"'·"'·f"·~f·YP';'~
.;;..." . . ____
........... " ....
u,",1'1,1,
........
G._!_"'
P ~""""r\T'·"':-:'I.;J
for r<~:) :~:L 1. 0 ~~: t ,"" ~3 :~-'"-~·<f':J~ :~'. ;~j t ...... 1;; C:: :.~' ,. . .l ~.. i: c:.. -', d. ::" C;~.. .~::: l: (:i):; i . \.: [1 of tl; J.
ta ~J' r't,",~,·1-''''"t'\1·~ r'l'·d· c·c·, .a...·t . . . ·L·l~ ".-:,,-..; ,~ . ..,
~"'Vi.~-...I·
.....
U
-l-<J_ . ..,_~ .• J
.. _ ..... _ ...
~.-"'~}'.-..4
~
"
... _~t..
(1. . . . . .
....
"'::. __ ._'~"_.L"""
".:)"--.J":
,_.--.:..,-_ ...J
""
..
~:.l,) •.. ,... " ..\.,-~l-- ..... -....,.)
~J.
the
;\3
I
iJ .::.:Z J :L" 3 s- T. (2 ~_: -_~ -~; t: J. I::, ~1. ': ,;:: ;. t :·,.-=:-c a j~ 1_!::<:~.-· ': -:c~ ir: ~~: ~'. J.~ ~~
r~~.~:-~ c:!.t t:::LJ \:i.~ =~ ~:,:.~"!.I(l i~-l :i.t;":: ~:1:= c::~E :-.c.-tI.\-- .::~.)i
l~ ~ --.~ ~:-l ~~-. J.: C> J:'-- C .~ "; .~~~ ~~.. t •
:_~ _' ,~~,,,, ::; .-'. :._~ ~~ 1-. ~~ [l:' ..: ~~_ ~;- ~'; -:))., ~ (! t r'~ ~~)-:
t:-:-~iJ I:! ~::~ ilj
i11 tl~'J r)==i:-":'~
1" .:: J
tot c: :~~~l.
t: >-:-~
I
~t': .. t ..L.,:.·. . ~
u·...,;,;.;_o, "'-;,)
I --"..-":"'Io~-"
"r
to
~·,;-r:·-~... ~.~'.l... -:-0
,_ •. J
t\:-~··l··-1f("t"-"'I
... ...,~·I.".
.. -iC~"\lt-.
• .., "''''4_
.• v
~"o.~,J_.:.L·
~:
fJ·-:--:·l
"'1""-f.:',,,4-·1 ,,-,-I.
"C;-1 J.·
l.. .... ~.l. _;.~ ....... v ••
•
_
..L<-_-::1._,
.~<~ i"-''''lc)1
t·O ,.,.·, ~. ,-)",,..,·t
t-·,-,:-~.... ·D~l··'.·
l.·"C-l.·'''''~''·:l~''rl·'l
...
_d~.,.;. ~0"-..,
..... ,....
..... 1"J1,1
1.:.,- ..... '-!'..,
.'.. -... _-.~
~
·\n~
(...(.1 ... ",
n '-']·;'
·ntL"\r''':·~
-r"1'-~.~
"·]~ll
DO
C'('''~''''
'("''''''-·'-I."l-i
I
},,..,~...,
",,';"'1
or,'·l."
";'/''''
l.
...... ~-,;J"" "~.10(...~_,J '\.J..
v
"_,,.1.1.
,L,,_v;..,J'· ~-J,.,.u -""
~ ..... ~ ... - I .I-I... .J 11
_ .. b~
~
,·OU·
....
0....... 1.-,
-.c,.,..r-r>d
to t-~',r'
'\"''':'I''ln~
ct·,...;,
/-.;.. ~V)".
r· ..... J"
"nd
:I
..t. "'.-"'-'''-J·l
~.~ .....
J. ...............
.c.'""' ....~
0~1'C)'~O:~t
...... ;.: ._.,
_
-..1 ... ·__
._'--4~
...
.!.~-;;;;
. . ,C.¥
-> b,~C1n-,.,.t}.~1''''''os;
CoL
J .. '-'...:,"' ......
-
_....
""
" - ...
..
... -.- ...
...
J_
ta"{ pol:Lci:.;~ l::; tl}.~~ Sl:j::~:]t j.:"'Gl"':.·~:~~ to
prCGSUr23 on int2r23t r~t~3.
~
:r·:;]~5.:;''f'lir!3 t:!1rl::-~~r!ssar;l
-"
."....
:-.r~._
'J:be 1!;)r1ol"201,;}
v. . 1.· cl'
'0:\
J.:.... ~·V".?Cj
'"'"' ~~ _'_? ", ...
J-
...;.~ \._ ._
"J..
.... . . .
C ~..,
~
1"1
C,- ........ "~
;A..,
,!"",_A-..,..-,
.•
i...l...:-._~~~
I1,..\-<:.,{""'tO
r,·'=
~1.,~'-.J
vJ.
...
_
f~.
__
~,
.j- i-:-.
-It
&"... ... ~__
• ...;. .......
l.. ____ _____;.
0;->
"'J',')?~~-~-:" .i_~··.:_~
'-"-'~""'\·"~"""!~:"n-""'·-j~·!""';-.}-\~
1.l..>,.-;;,i.) ~ " __ 30." ":.• _,,, b<-'1... -,_ 'y ,...-oJ
1'.')'3/-.''\",....-:- .._ _ .
. ".••:;1 ..... 1 • .::, .... CiJ,
n v.
n
.oJ.
2'"---1.U.J _..)
-~
#"')
~,'"
'-,
~ . • ,,..
•
--::>
-~..
",
~
# ....
-
.i '-,./ .......
....... -""\
w","
-)")
TREASURY DEPARTMENT
WASHINGTON, D.C.
FOR RELEASE 6: 30 P.M.,
Monday, Jure 2, 1969.
RESULTS OF TREASURY I S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated March 6, 1969, and the
other series to be dated June 5, 1969, which were offered on May 28, 1969, were
opened at the Federal Reserve Banks "today. Tenders were invited for $1,700,000,000,
or thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 182-day
bills. '!be details of the two series are as follows:
RANGE OF ACCEPTED
COMPETITIVE BIDS:
High
Low
Average
91-day Treasury bills
Se}2tember 4 z 1969
Approx. Equiv •
Price
Annual Rate
98.452
6.124~
98.427
6.223i
98.435
.6.191i 1/
maturin~
182-day Treasury bills
maturi!?;S December 4z 1969
Approx. Equiv.
Annual Rate
Price
6.397~
96.766
96.722
6.484i
96.737
6.454i
1.1
51~
of the amount of 91-day bills bid for at the low price was accepted
41i of the amount of 182-day bills bid for at the low price was accepted
roTAL TENDERS APPLIED FOR AND ACCEPl'ED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
'roTALS
Acce}2ted
AEE1ied For
$ 32,985,000 $ 22,985,000
1,255,736,000
2,053,986,000
16,957,000
31,957,000
32,235,000
::53,235,000
18,222,000
19,222,000
33,985,000
40,230,000
125,090,000
170,955,000
35,189,000
42,189,000
16,384,000
22,629,000
27,817,000
27,817,000
15,968,000
25,468,000
99,597,000
134,057,000
$2,634,730,000
ApE lied For
$ 4,418,000
1,783,468,000
15,690,000
22,766,000
8,708,000
25,477,000
139,114,000
25,730,000
15,619,000
12,538,000
19,117,000
149,623,000
$1,700,165,000 ~ $2,222,268,000
Acce}2ted
iii
4,418,000
1,046,538,000
5,690,000
22,766,000
6,508,000
18,769,000
82,064,000
19,612,000
7,119,000
12,538,000
10,117,000
64,078,000
$1,300,217,000
!I Includes $308,185,000 noncompetitive tenders accepted at the average price of
§I Includes $137,937,000 noncompetitive tenders accepted at tre average price of
II These rates are on a bank discount basis. The equivalent coupon issue yields
6.38~
for the 91-day bills, and 6.76i for the 182-day bills.
~/
98.435
96.737
are
/l-'
'REASURY DEPARTMENT
WASHINGTON. D.C.
June 4, 1969
'OR
IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
:or two series of Treasury bills to the aggregate amount of
;3,000,000,000, or thereabouts, for cash and in exchange for
Creasury bills maturing June 12, 1969,
in the amount of
;3,001,704,000,
as follows:
91-day bills (to maturity date) to be issued June 12, 1969,
.n the amount of $1,700,000,000,
or thereabouts, representing an
idditiona1 amount of bills dated March 13, 1969,
and to
lature September 11,1969, originally issued in the amount of
;1,100,151,000,
the additional and original bills to be
:ree1y interchangeable.
182-day bills, for $1,300,000,000,
lated
June 12, 1969,
and to mature
or thereabouts, to be
December 11, 1969.
The bills of both series will be issued on a discount basis under
:ompetitive and noncompetive bidding as hereinafter provided, and at
laturity their face amount will be payable without interest. They
7i11 be issued in bearer form only, and in denominations of $1,000,
;5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
:maturity value).
Tenders will be received at Federal Reserve Banks and Branches
Ip to the closing hour, one-thirty p.m., Eastern Daylight Saving
:ime,
Monday, June 9, 1969.
Tenders will not be
~eceived at the Treasury Department, Washington.
Each tender must
Ie for an even multiple of $1,000, and in the case of competitive
:enders the price offered must be expressed on the basis of 100,
7ith not more than three dec"ima1s, e. g., 99.925. Fractions may not
Ie used. It is urged that tenders be made on the printed forms and
:orwarded in the special envelopes which will be supplied by Federal
teserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
:ustomers provided the names of the customers are set forth in such
:enders. Others than banking institutions will not be permitted to
:ubmit tenders except for their own account. Tenders will be received
'ithout deposit from incorporated banks and trust companies and from
:-109
- 2 -
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announr
ment will be made by the Treasury Department of the amount and prier
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The Secre tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tender!
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on June 12, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
June 12, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be ma~
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
TREASURY DEPARTMENT
t
WASHINGTON, D.C.
June 4, 1969
FOR RELEASE AFTER 11:00 A.M.
WEDNESDAY, JUNE 4, 1969
TREASURY SECRETARY KENNEDY AND TREASURER OF
THE U. S. ELSTON WITNESS NUMBERING OF NEW CURRENCY
Treasury Secretary David M. Kennedy and Treasurer of
the United States Dorothy Andrews Elston today witnessed
the numbering of the first one dollar Federal Reserve
Notes bearing their signatures in ceremonies at the
Bureau of Engraving and printing.
It was the first time that an issue of currency notes
bearing signatures of both the new Secretary and the
Treasurer had been prepared since 1961, when those of
Secretary C. Douglas Dillon and Treasurer Elizabeth Rudel
Smith appeared on the Series 1957A notes.
The new Kennedy-Elston notes will be designated
Series 1969, replacing the present Series 1963B notes
The major Series-year change is based on the first use of
the new Department of the Treasury Seal -- adopted last
year -- on Federal Reserve Notes in addition to the change
in signatures of the Secretary and the Treasurero
o
The new series notes will be produced for each of the
12 Federal Reserve Banks
Because of the major Series-year
change, the serial numbers for each of the 12 banks will
revert to 00 000 OOlA preceded by the prefix letter
associated with each of the banks o
0
Shipments to each of the Federal Reserve Banks will
be made in the near future as total conversion to the new
notes is completed in the Bureau of Engraving and printing.
All denominations of United States currency will be
converted to the Kennedy 1969 Series.
000
K-110
TREASBRY DEPARTMENT
Washington
FOR RELEASE ON DELIVERY
SCHEDULED AT 10 A.M.
WEDNESDAY, JUNE 4, 1969
STATEMENT OF EUGENE T. ROSSIDES
ASSISTANT SECRETARY OF THE TREASURY
BEFORE THE
SUBCOMMITTEE ON CRIMINAL LAWS AND PROCEDURES
COMMITTEE ON THE JUDICIARY
UNITED STATES SENATE
June 4, 1969, 10 a.m.
Mr. Chairman and Members of the Committee:
I welcome the opportunity to appear before you
today on behalf of the Treasury Department to
discuss Treasury's law enforcement effort. Our
emphasis is on its role in the drive against organized
crime and its role in the drive against smuggling
into the United States of narcotics, marihuana, and
other contraband drugs. We also want to set forth
our views on S. 1624, Senator Hruska's proposal to
amend the Federal wagering tax statutes.
PresidentrNixon has given effective law enforcement
high priority and has directed the Executive Branch of
the Government to give full support to the war against
crime.
This Committee has, of course, been in the forefront of the fight against organized crime. Your
speech, Mr. Chairman, deliver~d from the Floor of the
Senate on March 11, 1969, and the remarks of Senator
Hruska, following your statement, give a detailed
K-lll
2
picture of the great danger of organized crime and
the problems we face in combatting it.
The Secretary of the Treasury, David M. Kennedy,
stated earlier this year that the full resources of
the Treasury Department--including each of its
investigative and enforcement arms--will be used as
needed in pressing the war on organized crime and
against the smuggling int0 the United States of
narcotics, marihuana, and other contraband drugs.
Secretary Kennedy has upgraded the status of
Treasury law enforcement by putting it under the
supervision of an Assistant Secretary. My responsibilities as Assistant Secretary (Enforcement and
Operations) include, among others, direct supervision
of the Secret Service, the Bureau of Customs, the
Treasury Law Enforcement School, and providing
policy guidance for all Treasury law enforcement
activities, including those of the Internal Revenue
Service.
.
In discussing these responsibilities with me,
Secretary Kennedy stressed the importance of the
Treasury's law enforcement role; that it is the
second largest law enforcement department in the
Federal government; that, in the past, law enforcement at the Treasury has not had the attention it
deserved from the Office of the Secretary and that
it is my responsibility to see to it that the old
situation is changed.
He has directed that a particular effort be
made to convey to the several thousand Treasury
Agents the full support of this Administration for
a maximum law enforcement effort.
The Secretary stressed that, in addition to the
overriding protective mission of the Secret Service,
two programs we:r:2 to be given priority:
3
1.
Organized Crime
2.
Smuggling of narcotics, marihuana,
and other contraband drugs into
the United States.
Organized Crime
The Treasury Department is making a major effort
support of the Administrationts drive against
organized crime as set down in the President's message
to Congress on April 23, 1969.
in
secretary Kennedy's instructions to me were brief
and explicit--full cooperation on a full partnership
basis with the Justice Department and other agencies
of the Federal Government in the drive against
organized crime.
Treasury Agents of the Internal Revenue Service,
the Secret Service and the Bureau of Customs will
continue to work and cooperate with other agencies
in the detection of wrong-doing and the development
of evidence leading to the prosecution of those who
have violated the law.
The Treasury Department, the second largest law
enforcement department in the Federal Government, will
provide a major part of the manpower in the expanded
effort against organized crime. Of the $25 million
in additional appropriations in the Administration
request of $61 million for organized crime efforts,
Treasury is requesting an increase of $9.4 million
over the previous Administration's budget. This
includes 680 more agents and supporting forces.
Of
the nearly $61 million being requested this year for
the onslaught against organized crime, Treasury
efforts will require $18,500,000.
4
The new request, with the Johnson Administration
request in parentheses, is as follows:
Customs, $900,000 ($400,000); Internal Revenue
Service, $16,800,000 ($8,400,000}; Secret Service,
$800,000 ($300, OOO) .
S. 1624
Wagering Tax Amendments
President Nixon,in his message to the Congress
on organized crime,referred specifically to S. 1624
and stated as follows in connection with the wagering
tax amendments legislation:
"We shall ask for swift enactment of
S. 1624 or its companion bill H.R. 322,
sponsored by Senator Roman Hruska of
Nebraska and Congressman Richard Poff of
Virginia respectively.
These measures
would amend the wagering tax laws and
enable the Internal Revenue Service to
playa more active and effective role
in collecting the revenues owed on wagers;
the bills would also increase the Federal
operator's tax on gamblers from $50
annually to $1,000."
The Treasury Department endorses S. 1624 and the
technical changes in S. 1624 suggested by the Department
of Justice by letter,from Deputy Attorney General
Kleindienst, dated May 16, 1969, to the Honorable
Wilbur D. Mills, Chairman of the Committee on Ways and
Means, in connection with H.R. 322, the companion bill
to S. 1624.
S. 1624 is a matter of major importance in the
Government's drive on organized crime.
Gambling is
the bread and butter activity of syndicated crime
because it is highly profitable and relatively safe.
5
The wagering, occupational and excise tax laws
were conceived and approved by the House Ways and
Means Committee in 1951. Prior to enactment of the
Revenue Act of 1951, commercialized gambling held
the unique position of being a multi-billion dollar
nationwide business that remained comparatively free
from special taxation by either the State or Federal
Government. During the consideration of the Revenue
Act of 1951, Congress became convinced that the
continuance of that immunity was inconsistent with
the need at that time for increased revenue,
especially since consumer items of a semi-necessity
nature were bearing new or additional tax burdens.
Generally, the acceptance of wagers on sporting
events and the conduct of a lottery are violations of
local ordinances.
Because of the disclosure provisions
of the 1951 wagering tax law and the close cooperation
by the Federal Government with State and local
enforcement agencies, persons liable for the payment
of wagering taxes attempt to conceal their activities
from both the local authorities and the Internal Revenue
Service.
The Intelligence Division of the Internal Revenue
Service is responsible for criminal enforcement of the
wagering tax law. To obtain evidence against wagering
tax violators, who are adept at subterfuge and
concealment, Treasury agents of the Intelligence
Division have concentrated their efforts largely on the
identification and investigation of significant violators.
In an attempt to crea~the broadest possible deterrent
effect with the limited manpower available, surveillances
have been conducted and wagers placed by undercover
Treasury agents, followed by local and nationwide raids
which resulted in seizures of valuable property,
particularly automobiles and substantial amounts of
currency.
The wagering tax law provides not only a source of
tax revenue, but also an important tool for criminal
6
enforcement against gambling syndicates. The
Intelligence Division, in enforcing the wagering tax
laws, has been able to bring more direct criminal
enforcement over a wider spectrum than would have
been possible through the enforcement of the income
tax laws against these same individuals. This is
because the only fact to be proven in a criminal
wagering occupational tax case is that the individual
accepted taxable wagers without having first purchased
a wagering occupational tax stamp, whereas in an
income tax case, it is necessary to prove a willful
attempt to defeat and evade income taxes or willful
failure to file a return.
This proposed legislation is urgently needed at
this time because of the intolerable situation which
exists with respect to the wagering tax law now on
the statute books. As you know, the Marchetti and
Grosso Supreme Court decisions of January 29, 1968,
served effectively to bar prosecution for wagering
tax non-compliance under existing statutes, but the
taxing authority of the Internal Revenue Service in
the wagering field was not iltered in any way by these
decisions. This placed the Internal Revenue Service
in an unenviable position--the responsibility to
enforce the wagering tax laws remained,but the most
important enforcement tool--criminal prosecution-was snatched away.
This would not have been such a serious blow if
the taxpayers involved were not gamblers. Individuals
making their livelihood from gambling will willingly
risk the possibility of a monetary penalty, if caught,
when the gain from such a gamble amounts to ten percent
of gross receipts.
The importance of an effective wagering tax
program to the government's drive against organized
crime can best be demonstrated through the statistical
data, attached as Exhibit A, covering a representative
period prior and subsequent to the Marchetti and Grosso
decisions.
7
The figures in Exhibit A are tabulated on a
fiscal year basis and, therefore, the 1968 figures
reflect activity for a seven;month period prior to
the Marchetti and Grosso decisions and a five-month
period subsequent to the decisions.
The wagering excise tax collections decreased in
Fiscal Year 1968 by approximately one million dollars.
This would indicate that collections decreased
approximately $200,000 per month during the post
Marchetti-Grosso period. Projected on an annual basis,
this represents a revenue loss in excess of two
million dollars.
The tabulation also discloses that more than
700 convictions were obtained each year during the
1964-1966 period. The decline in the number of
convictions for 1967 is attributed to the fact that
the Marchetti-Grosso cases were then under consideration by the Supreme Court and prosecutive action in
many pending wagering cases was held in abeyance.
The enactment of S. 1624 will revitalize the
wagering tax law.
It eliminates the disclosure
provisions, whereby wagering tax information could be
furnished to State and local governments, and this
should result in improved voluntary compliance.
Another provision of this bill having an important
bearing on increasing the revenue is the increase from
$50 to $1,000 per year in the rate of the occupational
tax for principals and agents who accept wagers on
their behalf, and the increase from $50 to $100 per
year for punchboard operators. Also under the proposed
legislation, pickup men and other employees engaged in
the wagering business who are now exempt from wagering
taxes, will become subject to the $100 wagering
occupational tax. The increased occupational tax
rate should also have a bearing on the type of sentences
which violators receive in Federal courts.
While we expect that a substantial increase in
8
revenue will result from enactment of this legislation,
we believe that this will come about gradually as
gambling operators gain confidence in the non-disclosure
feature of the law and realize that intensive enforcement action will continue.
Past experience does not offer a valid criterion
for anticipating the level of future compliance. The
existing law was designed to penalize compliance, for
the professional gambler discharging his wagering tax
law obligations opened himself to threat of local
];:.-osecution. The proposed bill eliminates this reason
for non-compliance. It is reasonable to expect that
intensive enforcement of this law will cause those
subject to the wagering tax law to recognize the value
of overt compliance, and thereby remove themselves
from the threat of Federal tax prosecution without
increasing other risks.
To achieve intensified enforcement in the
wagering tax area will require an increase in the
Intelligence Division special agent force and supporting
personnel. I believe that this increase in manpower
is highly desirable.
Assuming passage of this legislation, the Treasury
Department will move promptly to obtain the necessary
appropriation for additional manpower to carry out the
legislation.
I reiterate that this legislation is important,
not only to the Treasury Department, but also to the
entire Federal Government. It will permit the
Treasury Department to participate more fully in the
Government's fight against organized crime.
Broadening the base of those subject to the
occupational tax to include all persons in any way
associated with F?,;?ring activities and providing use
restriction powe~ under appropriate circumstances and
under carefully controlled Conditions will materially
9
assist the Government in obtaining information from
employees and other witnesses to identify absentee
owners and operators of gambling establishments
subject to the wagering tax statute.
This legislation should also help in obtaining
information needed to trace profits from gambling
activities in order to ascertain, to a greater degree,
which of such funds are being channeled from organized
crime into legitimate businesses. This is a subject
about which this Committee is deeply concerned.
Mr. William H. Smith, Deputy Commissioner of
the Internal Revenue Service, is also here today and
will make further comment on S. 1624. Mr. William A.
Kolar, Director of the Intelligence Division of the
IRS, is also present and is available for any questions
the Committee may have in connection with this
particular bill.
Smuggling of Narcotics, Marihuana,
and Other Contraband Drugs .
The second area of priority for Treasury law
enforcement is the effort against the smuggling into
the United States of narcotics, marihuana, and other
contraband drugs.
There is no greater concern in the
American household today than the problem of the use
of narcotics, marihuana, and other dangerous drugs by
our youth. These drugs cut into the entire fabric
of American life.
It is common knowledge that practically all of
the heroin and high-potency marihuana that is used
in the United States is grown and refined abroad and
smuggled into the United States. An increasing
amount of the low-potency marihuana is being grown
and consumed in the United States.
President Nixon, in a statement in Anaheim,
California on September 16, 1968, stressed the
10
great danger from these drugs.
He referred to Customs'
responsibilities for preventing smuggling and
recommended a substantial increase in Treasury Agents
for Customs and noted that this was also urged by the
President's Crime Commission.
Secretary Kennedy has put great stress on the
Treasury's responsibility in this area. Following the
directive from Secretary Kennedy, and in consultation
with the Commissioner of Customs, we have organized
a Contraband Drug Section in the Enforcement Division
of the Bureau of Customs.
We have started a special training course for
Customs inspectors so that they will be up to date on
the newest methods and techniques for detecting
contraband drugs being smuggled into the United States.
Frankly, we believe that the Customs operation
has been understaffed in this area. We are presently
drawing up at the Treasury for recommendation to the
White House ~n intensified program to prevent the
smuggling of narcotics, marihuana, and other contraband drugs.
Organized crime is involved in narcotics smuggling
and our efforts in this area will be coordinated with
the overall Federal effort against organized crime.
Mr. Chairman, that concludes my statement. It is
a pleasure to appear before this Committee which has
done so much to alert the American people to the
dangers of organized crime and which has been
responsible for so much effective legislation to combat
organized crime. I shall be pleased to answer any
questions that you or members of the Committee may have.
~
A
~
Wagering Taxes--Statistical Data
FY 1964
FY 1965
FY 1966
FY 1967
FY 1968
7,465
7,284
6,155
5,917
5,089
Revenue Collections
(a) Occupational Tax
(b) Excise Tax
$ 617,000
$5,439,000
$ 603,000
$6,071,000
$ 705,000
$5,689,000
$ 572,000
$5,624,000
$ 416,000
$4,695,000
Value of Property Seized
(a) Automobiles, Other
(b) Currency
Total
$ 356,608
$ 665,020
$1,021,628
$ 326,359
$ 860,923
$1,187,282
$
$
$
Wagering Tax Stamps Sold
275,957
463,185
739,142
$
$
$
294,830
451,596
746,426
$
$
$
217,811
468,132
685,943
~
~I
Persons Convicted
874
806
723
491
192
Special Agent Man-Years
290
274
263
259
159
~
.~
~
~I
TREASURY DEPARTMENT
t
WASHINGTON. D.C.
June 4, 1969
FOR IMMEDIATE RELEASE
UNITED STATES FOREIGN GOLD TRANSACTIONS
FIRST QUARTER 1969
The Treasury announced today that during the first
quarter of 1969 there were net sales of about $56 million
of monetary gold to foreign countries.
Major transactions
were purchases of $50 million from France, and sales of $76
million to Italy and $25 million to Switzerland.
(See Table 1,
attached.)
As shown in Table 2, there were two small sales to
enable other countries to pay the gold portion of their
quota increases in the International Monetary Fund, against
which deposits of like amounts of gold were made by the IMF.
At the end of the quarter such deposits totaled $231 million.
K-112
,~
0
UNITED STATES NET MONETARY GOLD TRANSACTIONS WITH
FOREIGN COUNTRIES AND INTERNATIONAL INSTITUTIONS
January 1 - March 31, 1969
(In millions of dollars at $35 per fine troy ounce)
First
Area and Country
Quarter
Western Europe
France
+50.0
Iceland
*
Italy
-76.0
Switzerland
-25.0
Yugoslavia
-1.0
Total
-52.0
Latin America
Bolivia
-0.1
Chile
-0.6
Costa Rica
-0.1
Dominican Republic
-0.1
Ecuador
+4.0
El Salvador
-0.1
Guatemala
-0.1
H~;ti
-0.1
Honduras
*
Nicaragua
-0.1
Panama
-4.2
Peru
-5 9 1
Total
-6 6
0
Asi.g
Afghanistan
Burma
Ceylon
Indonesia
Pakistan
Philippines
Southern Yemen
Syria
Total
New Zealand
-0 1
0
*
-0.2
-0
0
4
-0 2
+6.8
-1.2
0
-0,1
+4 6
0
-1.1
Africa
Burundi
*
Liberia
-0.1
Morocco
-0.1
Rwanda
*
Somalia
*
Sudan
-0.3
Tunisia
-0 9 2
Total
-0.8
Total
-55.9
Domestic Transactions
+D.8
-55.1
Total Gold Outflow
*Under $50,000.
Figures may not add to totals because of rounding o
TABLE 1
TABLE 2
UNITED STATES MONETARY GOLD TRANSACTIONS
WITH FOREIGN COUNTRIES
MITIGATED THROUGH SPECIAL DEPOSITS BY THE IMF
(Millions of U.So$)
January 1 - March 31, 1969
Area and Country
Latin America
Dominican Rep
Africa
Ivory Coast
0
F~rst
Quarter
-0.7
-0.2
Total
IMF Deposit
+0.9
UNITED STATES SAVINGS BONDS ISSUED AND REDEEMED THROUGH
13/
May 31, 1969
(Dollar amounts in millions - rounded and will not necessarily add to totals)
DESCRIPTION
rUREO
;pries A-1935 thru D-1941
;eries F and G-1941 thru 1952
;eries .J and K-1952 thru 1957
AMOUNT
REDEEMEDY
AMOUNT
OUTSTANDINGY
5,003
29,521
3,754
4,996
29,481
3,714
7
39
40
.14
.13
1.07
1,881
8,304
13,364
15,584
12,251
5,556,
5,271
5,451
5,381
4,704
4,070
4,263
4,870
4,964
5,171
4,994
4,703
4,581
4,292
4,301
4,353
4,190
4,672
4,554
4,453
4,792
4,747
4,482
713
1,663
7,352
11,861
13,747
10,629
4,ch1
4,303
4,162
3,587
3,105
3,228
3,598
3,595
3,685
3,512
3,239
3,022
2,756
2,648
2,509
2,348
2,441
2,387
2,296
2,270
2,08.5
1,504
42
218
953
1,503
1,838
1,622
915
1,022
1,148
1,219
1,117
964
1,035
1,272
1,369
1,487
1,482
1,464
1,560
1,536
1,653
1,843
1,841
2,2Jl
2,168
2,157
2,522
2,663
2,978
671
11.59
11.48
11.25
11.79
13.24
16.47
19.39
21.06
22.65
23.75
23.69
24.28
26.12
27.58
28.76
29.68
31.13
.34.05
35.79
38.43
42 •.34
43.94
47.75
41.61
48.44
52.63
56.10
644
811
-227
-
161,.556
117,331
44,22.5
27.37
.5,48.5
7,039
3,3.57
1,629
2,128
.5,410
38.80
76.86
12,523
4,986
7,.537
60.19
174,079
122,317
.51,762
29.73
38,277
174,079
212,3.57
38,191
122,317
160,508
86
.51,762
51,848
.22
29.73
24.42
AMOUNT ISSUEDY
~ATUREO
;eries Ell :
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
Unclassified
Total Series E
Series H (1952 thru May, 1959)}j
H (June, 1959 thru 1969)
Total Series H
Total Series E and H
rota1 matured
All Series
Total unmatured
Grand Total
4,~!l.i8
tudes accrued discount.
"ent redemption value.
Option 01 owner bonds may be held and will earn interest for additional per/ods after ori~inal maturity dates.
Fnrm pn 3812 (RAv. Anr. 1969) - TREASURY DEPARTMENT - Bureau of the Public Debt
'70 OUTSTANDING
OF AMOUNT ISSUED
66.44
94.11
TREASURY DEPARTMENT
Washington
FOR RELEASE ON DELIVERY
SCHEDULED AT 10 A.M.
(MOUNTAIN ffiYLIGHT TIME)
SATURDAY, JUNE 7, 1969
ADDRESS OF THE HONORABLE ffiVID M. KENNEDY,
SECRETARY OF THE TREASURY,
TO THE 1969 GRADUATING CLASS,
WEBER STATE COLLEGE, OGDEN, UTAH,
SATURDAY, JUNE 7, 1969
Dr. Miller, Members of the Board of Trustees, Members of the
Faculty, Members of the Graduating Class of 1969, and friends •...
Thank you for inviting me to be with you today. I hope you
will permit a Weber alumnus of long standing to share vicariously
with the men and women of the Class of 1969 the very real sense of
achievement they must feel at this IIDIIlent. I shall try to reciprocate
by being mercifully brief -- so that you can ITDve on to celebrating
with your family and friends.
Ever since man formalized the Three R's, Commencement Week has
been a time of high and happy celebration. I suspect that this June
will be recorded as one of the ITDst gratifying of them all -- at
least to those millions of parents across the land who will sleep
better knowing their sons and daughters are safely home from cOllege.
I also suspect that we may be witnessing the start of a truly
revolutionary movement, led by the Weber students who recently
presented Dr. Miller with a school sweater and awarded him the title
of "Our President." I suspect there are quite a few college presidents
around the country who would like to be in his shoes today or, -- in
this case, in his sweater!
By time-honored custom, a Corrrrnencement Speaker feels impelled to
send the graduates home with a challenging message -- usually because
he hopes they can somehow solve some of the problems that were too
much for his generation.
K-113
- 2 Most certainly we have rrore than enough challenges to go
around, coupled with a very real shortage of genuinely concerned,
educated young people to help us meet those challenges.
Just to mention one that concerns me as Secretary of the
Treasury, let me point out that each member of the Class of 1969
is in debt to the tune of $1,427, exclusive of anything you may
ONe your parents or the Alumni Association. That $1,427 is your
per capita share of the national debt, and unless we bring inflation
under control in pretty short order, it may be considerably higher
by the time you cash your first pay check.
Let us hope that 20 or 25 years hence, when ¥our sons and
daughters graduate, the cost of citizenship in this country will
have been reduced and its rewards enhanced. Hope alone will not
do it, but personal involvement will -- and I mean personal involvement in every aspect of our troubled, but still resilient society.
Therein, I believe, lies real hope that something of great
value will emerge from the unrest that disturbs so many of our colleges
and universities today. This generation of yours is involved -- not
always, it is true, in ways that people my age admlre -- but certainly
your generation is taking a hand and raising its voice in the life
of our society. """And I, for one, am confident that all that energy and
enthusiasm and intelligence will have a lasting effect on the quality
of life in America -- a good effect.
Much has been said and written about a wide and growing
disaffection among many students on the American campus today:
-- They sense hypocrisy in many of their elders who preach the
Golden Rule, but tolerate racial discrimination, needless poverty, and
JIDral rot.
ffi3.n
-- They suspect that the by-products of technology are poisoning
and his environment.
-- They feel that our system has somehow failed and, instead of
uplifting man, we are polluting roth mi,nd and matter.
Perhaps worst of all is their growing conviction that they have
lost contact with their elders -- that no one is listening on the
other side of the generation gap.
The best among them register their feeling in honest dissent.
- 3 The worst seek to cure American society by burning it to the
ground.
I must admit there are times when I, too, share the uneasiness
of the honest dissenters.
Certainly there is roam for improvement in the quality of
American education -- particularly in the giant multi-university
where the student all. too often is shut off by the sheer weight of
numbers from the personal faculty-student relationship you have
enjoyed in your years at Weber.
Certainly the resources exist to do something about racial
discrimination -- about poverty -- about slum housing -- and about
the vast conspiracy of organized crime that thrives on official
corruption and public apathy.
The big question is:
Do
we have the will?
I say that as a nation, and as a people, we rrost certainly do!
It is in the nature of youth to look for instant solutions and
to suspect a fatal flaw in a system that cannot produce instant
solutions. However, problems that have been building up for generations can not be resolved overnight -- no matter how high our intentions, how genuine our concern, nor how willing we are to face up
to the task.
But I can tell you this: President Nixon and the people he has
brought into his Administration are moving with thoughtful purpose
to correct the injustice and imbalance that still exist in the freest
and most affluent society on earth.
We are determined to reduce the racial tensions that disturb all
men of good conscience.
We are actively seeking to improve the quality of life for the
disadvantaged in our urban and rural slums.
We are bending every effort to restore peace.
We shall, I promise you, strive mightily to build a better world.
Such a W01..Ld may not be the perfect world youth demands. I'm
afraid that assignment must be left to you and your children -- and
I sincerely hope that the generation gap will have narrowed substantially by the time your turn comes to lead.
- 4 -
Since man first appeared on Earth, he has encoW1tered a
bewildering and W1ending series of problems. He has usually resolved
them. But the solutions have often created new problems which man,
being imperfect, did not foresee. Many are paradoxical.
For example, why is our air polluted? Because man discovered
that he could produce energy fran coal and oil in order to keep
warm and to power the machines that manufacture an endless variety of
goods for utility and comfort and service. And because gasoline
engines that power the family car give off noxious fumes.
Why is our water polluted? Largely because man, with his
inability to anticipate all consequences, dumped the untreated wastes
from desirable industrial growth into rivers and streams.
Even our most positive achievements may have built-in problems.
For example, sanitation and medical discoveries have cut down the
infant mortality rate, extended the human life span, and made life
a more enjoyable experience. Yet those same discoveries contribute
to the world-wide population explosion that threatens to engulf mankind.
Truly, the challenges before you are enormous. Fortunately, in
addition to youth, native talent, drive, and idealism, you have
another asset to help you meet them: namely, education.
Many years ago, an acute observer, H. G. Wells, conunented that
"human history becomes more and more a race between education and
catastrophe." And he suggested rather gloanily that we were losing
the race. Well, I disagree. I believe we are going to win that race,
so long as our colleges and universities continue to strive for
excellence.
Isn't that what all of us, yOW1g and old, really want to achieve
for our schools and universitites? I believe that all but the bookburning Nihilists would agree that we seek the highest attainable
quality of education, plus opportW1ities for every young man and
mman to obtain such an education. And I subnit that those opportunities are denied when university authorities surrender to violence or
the threat of violence.
In recent months, there has been a rlsmg clamor for repressive
legislation -- Federal, state, and local -- to deal with campus
disorder. Much of the outcry stems from emotion, rather than reason.
We want law and order on the campus.
But the law that best serves
- 5 -
our national purpose is the law of reason, and the order we seek is
one in which students can participate in the life of the university,
share in its decisions, and respect the authority of the university.
A national policy for dealing with college unrest that fails
to distinguish between legitimate student dissent and anarchistic
disorder would be as futile as it would be destructive of our
freedoms. And it would only serve to alienate some of the very
same young men and women who should soon assume our national leadership.
Laws already exist to deal with rioters and revolutionaries.
They can and should be enforced. But I believe our need is not for
more laws, but for fewer lawbreakers. We IIUlst find ways to rekindle
respect for law and the democratic process in our student population.
Meanwhile, let me suggest to campus radicals and moderates alike
that we will all get on with the job of improving the American
society a lot faster and more effectively if we stop shouting at
each other and start talking to each other. The process of soCIal
and economic advance is a contInuing one -- not something that comes
to a dead halt with the passing of one generation, then begins all
over again with the next.
Here, let me say that I cannot leave this platform without
discussing an issue that is not only contributing to campus unrest,
but is tearing at the fabric of our society. I refer, of course, to
the overriding problem of Vietnam.
Reasonable men and women -- both those who believe firmly in our
original commitment in Vietnam and those who honestly do not -- want
to see the war ended. They want to bring our servicemen home. And
without abdicating our world responsibilities, without weakening our
national security, they want to devote more of our resources to the
problems of our home front.
No one is more concerned, no one is working harder, and no one
feels a greater sense of urgency and responsibility to end the war
than President Nixon.
The President has said -- and it is useful to repeat it here
today, since some of you will soon enter military service -- that we
are engaged in this conflict, "not for glory, not for conquest, not
for an inch of territory, nor for any concession, but for the preservation of peace and freedom."
- 6 -
There is no other issue on which there is a more crying need for
us to be united. Ho Chi Minh's basic strategy since the beginning
of the Viet Cong rebellion against France after World War II has
counted heavily on a divided public opinion among his adversaries.
That strategy was successful against the French, it divided the
Vietnamese people, and it is prolonging the killing and standing
in the way of a just and honorable settlement for both sides today.
Let us hope and pray and VoX)rk united toward that just and
honorable settlement, so that we may all get on with our pressing
tasks at home.
President Nixon reminded us, in his Inaugural Address last
January, that time and the march of events confront each oncoming
generation with problems and decisions totally different from the
experiences of the past.
Mr. Nixon recalled how Franklin Delano Roosevelt, in his
Inaugural Address a third of a century before, had surveyed the
troubles of a nation ravaged by depression and gripped in fear.
America's troubles, President Roosevelt said, "concern, thank God,
only material things."
"Our crisis today is
American people.
1I1
reverse," President Nixon told the
"We find ourselves rich in goods, but ragged in spirit; reaching
with magnificent precision for the moon, but falling into raucous
discord on earth.
"We are caught in war, wanting peace. We are torn by division,
wanting unity. We see around us empty lives, wanting fulfillment.
We see tasks that need doing, waiting for hands to do them.
"To the crisis of the spirit, we need an answer of the spirit."
And then President Nixon said:
"To find tl,a-: '1J1swer, we need only to look within
ourselve~."
We live in an age of science and technology, a time of almost
unbelievable breakthrough in all fields of human knowledge, when
it sometimes seems that the computer may replace man. But it has
been said -- and truly, I believe -- that in the long span of Time,
Science will prove to be only a footnote to human history. In the
end, it is the spirit of man that will shape }-'is destinyc And it is
that hwnan spirit, ennobled and enriched by your years her'e at Weber
- 7 College, that will sustain you as you begin your great new adventure.
What a challenge is yours!
What an opportunity to serve mankind!
Truly ...... I envy you!
Thank you.
000
WASHINGTON, D.C.
June 7, 1969
MEMORANDUM TO THE PRESS
The following is an insert to the speech of Secretary
of the Treasury David M. Kennedy, to the 1969 Graduating
class, Weber State College, Ogden, Utah, scheduled for
delivery at noon, EDT, this date.
Insert follows second paragraph, page 2 of Kennedy
teJ\;t :
At this point, I am going to depart from my prepared
remarks to tell you regretfully that I am going to have to
cut short my long-anticipated visit to Utah in order to
return to Washington tomorrow to testify before an influential
committee of the United States Congress on a proposal by
President Nixon that is crucially important if we are to lick
inflation.
Years of inflation have distorted our economy.
I need
hardly remind you graduates and faculty members that we
cannot achieve our country's goals -- the goal of national
security, the goals of growth at home, influence and prestige
abroad, the goal of a better life for all of our citizens,
the goal of order in our cities -- unless we have a strong,
healthy, growing economy.
The measure on which I am to testify Monday will contribute
to such an economy.
It calls for extension of the present
10 percent income tax surcharge, which is now scheduled to
expire at the end of this month.
Now, I recognize that all of us would dearly like to
see lower taxes.
However, a reduction in taxes -- which is
precisely what would come about if the surcharge were not
extended -- would add to already very strong inflationary
pressures and further erode the value of the dollar, both at
home and abroad.
If we are to get on top of inflation, we must keep tax
levels high enough to have a surplus in the federal budget.
And even though we are cutting back government spending, we
cannot realize that surplus unless we extend the income tax
surcharge beyond the end of this month.
-
2 -
Therefore, responsible economic planning and financial
management by your government call for u~ to maintain taxes
at their present levels for this year. We would then reduce
the surcharge rate to 5 percent on next J~nuary 1, and let it
expire entirely on June 30, 1970.
That 1S what I hope to persuade the House Ways and Means
Committee to do when I appear before it Monday.
Wish me luck!
END INSERT.
000
"REASURY DEPARTMENT
leff
!
WASHINGTON. D.C.
June 9, 1969
OR IMMEDIATE RELEASE
TREASURY TRANSMITS REQUEST TO CONGRESS
TO EXTEND INTEREST EQUALIZATION TAX
Treasury Secretary David M. Kennedy today is sending to
he Congress a bill to extend the Interest Equalization Tax
or 18 months, to January 31, 1971. The present legislation
xpires July 31, 1969.
The proposed new legislation would continue in force this
ssential part of the United States balance-of-payments program.
The Interest Equalization Tax applies to acquisitions by
nited States residents or citizens of foreign stocks and
ebt obligations from foreigners, and reduces the outflow of
ollars from the United States by increasing the annual cost
o foreigners of raising capital in the United States market.
Under discretionary authority granted by Congress in 1967,
he President can vary the effective annual rate of the tax
rom zero to 1-1/2 percent as the balance-of-payments position
ermits. The present effective rate of 3/4 percent was
stablished in an Executive Order signed by the President on
pril 3, 1969.
The proposed legislation includes several technical
mendments, and makes the existing authority of the President
o vary the rate of tax within the limits set by Congress more
lexible by authorizing the President to adjust the tax rate
n new issues downward without an equivalent reduction of the
ate applicable to outstanding securities. This amendment
ould be used to reduce reliance upon the Interest Equalization
ax, in line with the President's announcement of April 4, 1969,
hat:
'~e shall stop treating symptoms and
start treating causes, and we shall
find our solutions in the framework
of freer trade and payments."
A Treasury explanation of the bill is attached.
-114
TREASURY DEPARTMENT
PROPOSED INTEREST EQUALIZATION TAX
EXTENSION BILL OF 1969
EXPLANATION
The proposed "Interest Equalization Tax Extension Act
of 1969", which amends the Internal Revenue Code of 1954,
extends the tax for 18 months so that it would expire
January 31, 1971.
Furthermore, by
su~plementing
existing
Presidential authority to vary the rates of tax within the
range already prescribed by Congress with authority to set
lower rates for original or new issues, the bill could be
used to reduce our reliance upon the tax in line with
the President's announcement of April 4, 1969, that
"We shall stop treating symptoms and start
treating causes, and we shall find our solutions
in the framework of freer trade and payments."
In addition, the bill makes several technical, clarifying, and conforming changes to facilitate administration of
the tax or eliminate unintended hardship.
A description of
the provisions of the proposed bill follows:
(1)
Extension of Tax:
Section 2 of the bill
amends section 4911(d) to extend the termination
date of the tax by 18 months, to January 31, 1971.
- 2 (2)
Lower Rates
0.1
Original or New Issues:
Section 3 of the bill amends section 4911(b) (2) (A)
to grant the President authority to make the rate
applicable to stock or debt obligations which are part
of an original or new issue (or a specific classification
of original or new issues)
lower than the rates appli-
cable to outstanding stock or debt obligations.
Under
existing law the President may vary the effective
annual rate between zero and 1 1/2 percent, but the
rate must be the same for new and outstanding issues.
By refining existing authority so as to permit a
lower rate to be applied to original or new issues,
the bill could be used to reduce our reliance upon the
interest equalization tax without the adverse effect
on our balance-of-payments which might result if such
lower rate were also applicable to outstanding issues,
including issues sold to foreigners by domestic corporations for the purpose of financing foreign affiliates.
For the purposes of the interest equalization tax, such
issues are treated as debt obligations of foreign
obligors.
-
3 -
The bill provi::k:, -that
~~l::2
t.C·,:'r.l
"original or
new issue" shall ha-)c 'c_he sane meaning as in section
4917 which contains the exclusion for international
monetary stability, and that the President may in the
Executive Order limit the amount and classification
of such original or new issues to which the lower rates
are applicable.
It is intended that the President have
authority under this section to limit an Executive Order
at least to the extent he can (or is required to)
limit an Executive Order under section 4917.
An
Executive Order could also require a "notice of
acquisition," or provide other implE.menting procedures.
Also, under this authority the President could deny
"original or new issue" treatment where the proceeds
are to be used for the purpose of avoiding a higher
rate applicable to outstanding issues or otherwise
avoiding the limitations applicable to any preferential rate for new issues.
(3)
Certain transfers to foreign trusts:
Sub-
section (a) of section 4 of the bill amends paragraph
(1) of section 4912(b) by redesignating the present
text as subparagraph (A) and adding new subparagraph (B).
Paragraph (1) of section 4912(b)
(redesignated
subparagraph (A)) presently provides that any transfer
- 4 (other than in a sale or exchange for full and
adequate consideration) of money or other property
to a foreign trust is deemed an acquisition by the
transferor of stock of a foreign issuer, but only
to the extent that such trust acquires stock or
debt obligations (of one or more foreign issuers or
obligors) which would, if acquired directly by the
transferor, be subject to the interest equalization
tax.
The new subparagraph (B) of paragraph (1) provides a rebuttable presumption that, subsequent to
such transfer, the foreign trust acquired stock or
debt obligations which would, if acquired directly
by the transferor, be subject to the interest
equalization tax.
The presumption may be rebutted
if the transferor submits proof satisfactory to the
secretary or his delegate that, during the calendar
quarter in which the transfer took place and each
succeeding calendar quarter, liability for the
interest equalization tax has either not been incurred
or has been paid.
Such proof must be submitted on
or before the 30th day following the close of each
such quarter.
.... 5 .,...
The amendatory provisions are designed to give
the Internal Revenue Service a more effective means of
determining whether a transferor has incurred interest
equalization tax liability ..
(4)
Certain domestic financihSJ companies:
Sub-
section (b) of section 4 of the bill amends paragraph
(3B) of section 4920(a) which provides that a domestic
corporation engaged in the business of financing the
sales of products manufactured by affiliated companies
in the United States or abroad may elect to be treated
as a foreign issuer or obligor.
Section 4920(a) (3B) was enacted in 1967 to permit
such sales financing activities free of tax if the
prescribed conditions were satisfied.
Such conditions
have been found to be too restrictive and i t has been
determined that some of the conditions can be removed
without substantial balance of payments risk.
The
bill replaces existing section 4920(a) (3B) with a
new provision in section 4920(d)
(existing section
4920(d) is redesignated as section 4920(e»
to permit
the everyday operations of "captive" sales financing
companies without undue operating burdens, while at
the same time retaining the foreign borrowing and
certain other requirements to protect our balanceof-payments position.
- 6 New section 4920(d) provides that in order for
a domestic corporation to qualify as a "foreign
issuer or obligor" it must be exclusively engaged
in the trade ·or business of acquiring and servicing
debt obligations arising out of sales of tangible
personal property or otherwise described in section
4920(d) (1).
Also, at least 90 percent of the face
value of the debt obligations {with two exceptions)
owned by such corporation at all times during the
taxable year must consist of debt obligations
described in paragraph (1) of section 4920(d).
The permissible types of debt obligations are
those arising in connection with sales of products
produced, manufactured, assembled, or extracted by
affiliated companies in the United States or abroad,
trade-ins; trade-ins on trade-ins, exports from the
United States not less than 85 percent of the purchase
price of which is attributable to property manufactured, produced, grown, or extracted in the united
States, or services performed by United States persons,
and loans to certain dealers or distributors.
A 10
percent "cushion" is provided permitting the ownership
of debt obligations arising out of other
- 7 sales of tangible personal property.
In applying
the 90-10 rule, bank deposits with a maturity of less
than one year and debt obligations of affiliated corporations which were received as payment for stock or as
a contribution to capital are not taken into account.
Acquisitions of foreign or domestic stocks are not
allowed except those of affiliated corporations received as a payment for stock or as a contribution
to capital.
All debt obligations must be acquired out of
the prodeeds of certain foreign borrowings, equity
capital attributable to foreign borrowings by affiliates,
retained earnings and reserves.
This limitation is
designed to assure that there will be no adverse
effect on our balance-of-payments position as a result
of such financing activities.
In addition to the above requirements, the
corporation must maintain prescribed records and elect
to be treated as a foreign issuer or obligor.
If the
corporation fails to meet any of the statutory
conditions all debt obligations held by it at the time
of revocation, which except for the election would be
taxable, are subject to tax.
- 8 Paragraph 3 of section 4(b) of the bill makes
minor conforming amendments to section 49l5(c) (3) under
which foreign subsidiaries, 50 percent or more owned by
affiliated corporations, will not be considered formed
or availed of for the principal purpose of tax avoidance if they satisfy the conditions imposed on domestic
sales financing companies under section 4920(d) and
give timely notice to the Secretary or his delegate.
(5) Reporting requirements'of nonparticipating
firms:
Subsection (c) of section 4 of the bill amends
paragraph (3) of section 6011(d) to conform its provisions with the provisions of section 4918 which were
revised at the time of the enactment of the Interest
Equalization Tax Extension Act of 1967.
In its present
form, this paragraph, which was not amended in 1967,
refers to procedures made obsolete by the 1967 Extension
Act.
In order to correct this legislative oversight,
paragraph (3) of section 6011(d) is amended to provide
that suitable reporting and recordkeeping may be required of a member or member organization of a national
securities exchange or association registered with the
Securities and Exchange Commission which is not a
participating firm referred to in section 4918(c}.
Such
- 9 reporting and recordkeeping requirements are necessary
to assure proper administration of the interest
equalization tax.
The amendment requires that such member or member
organization keep such records and file such information as the Secretary or his delegate may by forms or
regulations prescribe in connection with certain
acquisitions and sales effected by such member or member
organization, whether for his own account or as a broker.
These recordkeeping and information reporting requirements could be made applicable to acquisitions and sales
with respect to which:
(1) validation certificates
issued by the Internal Revenue Service (described in
section 4918(b) (1) (A)) are received from the Service
or any other source, or (2) an acquiring United States
person is subject to the interest equalization tax.
The latter includes acquisitions and sales with respect
to which a written confirmation is furnished to a
United States person (or should have been furnished)
indicating that the particular acquisition is or may
be subject to the interest equalization tax.
As amended, section 6011(d) (3) would not be applicable to a member or member organization if it is
a participating firm within the meaning of section
4918(c).
Section 4918(c) already provides that
- 10 -
participating firms must comply with the documentation,
recordkeeping, reporting and auditing requirements
prescribed by the Secretary or his delegate.
The effect of the amendment is to remove any
doubt as to the obligation of nonparticipating firms
to file the Broker's Quarterly Information Return
(Form 3845) and to maintain the records necessary
to enable the firms to do this and to maintain records
or file returns which might subs"equently be prescribed.
Participating firms are also required to file Form 3845.
(6)
Failure of Nonparticipating Firms to File
Information Returns:
In order to implement the above
amendment relating to reporting requirements for nonparticipating firms, subsection (d) of section 4 of the
bill amends section 6680 by redesignating the existing
provisions as subsection (a) and by adding a new
subsection (b) which imposes a penalty upon a member
or member organization of a national securities exchange
or association registered with the Securities and Exchange
Commission who fails to file any ii1formation return
prescribed by the Secretary or his delegate pursuant
to the amended provisions of section 6011(d) (3), unless
the failure to file is due to reasonable cause.
The
141
- 11 -
amount of the penalty is $1,000 for each failure
to file the required return.
Since the present
quarterly information return (Form 3845) is an
important tool in interest equalization tax enforcement
efforts, it is necessary that a penalty be imposed for
noncompliance by nonparticipating firms.
Participating
firms are already subject to other sanctions.
rREASURY DEPARTMENT
WASHINGTON. D.C.
FOR RELEASE 6: 3() P.M.,
Monday, June 9, 1969.
RESULTS OF TREASURY I S WEEKLY BILL OFFERnm
The Treasury Department announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated March 13, 1969, and
the other series to be dated June 12, 1969, which were offered on June 4. 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $1,700,000,000,
or thereabouts, of 91-day bills and for $1,300,000,000, or thereabouts, of 182-day
bills. The details of the twa series are as follows:
91-day Treasury bills
maturing September 11, 1969
Approx. Equiv.
Price
Annual Rate
RANGE OF ACCEP'lED
COMPETITIVE BIDS:
98.372
High
Low
Avera.ge
a'
~'
;;;;
a,'
-J
98.309
98.334
6. 44CJ.'
6.69Oi
6.591~
182-day Treasury bills
maturing December 11, 1969
Approx. Equiv •
Price
Annual Rate
b'
96.544
6.836J
96.463
6.996~
96.498
6.927~
. ..c...J
Y
l~'(Cept -in;:; lyf :/\,00:)
Excepting 4 tenders totaling $1,510,000
14~ of the amount of 91-day bills bid for at the low price was accepted
3~ of the amount of 182-day bills bid for at the low price was accepted
'roTAL 'lENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
IDTALS
(I
1,931,080,000
34,053,000
47,595,000
19,665,000
40,545,000
158,912,000
47,373,000
28,054,000
31,253,000
27,028,000
138,235,000
1,121,780,000
19,053,000
47,595,000
19,665,000
39,545,000
158,912,000
46,373,000
28,054,000
31,252,000
19,028,000
136,515,000
Applied For
$ 5,078,000
. 1,620,763,000
20,614,000
30,611,000
20,030,000
27,093,000
136,347,000
30,084,000
19,886,000
18,293,000
19,456,000
124,101,000
$2,546,081,000
$1,700,060,000
Y $2,072,356,000
Applied For
$
Acce~ted
42,288,000 $2,288,000
Accepted
$>
5,078,000
957,763,000
10,614,000
30,611,000
13,530,000
24,093,000
117,347,000
27,584,000
13,886,000
18,293,000
11,456,000
70,101,000
$1,300,356,000 ~I
S'I Includes $339,802,000 noncompetitive tenders accepted at the average price of 98.334
~ Includes $172,437,000 noncompetitive tenders accepted at the average price of 96.498
1,/ 'lbese rates are on a bank discount basiS. 1b;e equivalent coupon issue yields are
6.8~ for the 91-day bills, and 7.2~ for the 182-day bills.
/tff
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
June 11, 1969
FOR IMMEDIATE RELEASE
GENE A. KNORR APPOINTED DEPUTY SPECIAL ASSISTANT
FOR CONGRESSIONAL RELATIONS TO SECRETARY OF TREASURY
The appointment of Gene A. Knorr as Deputy Special
Assistant to the Secretary of the Treasury (Congressional
Relations) was announced today by Secretary of the
Treasury David M. Kenn"edy.
Mr. Knorr, 28, comes to the Treasury Department
with two years service on Capitol Hill as Legislative
Assistant to Representative Tom Kleppe (R.-N.D.).
Prior to joining Mr. Kleppe's staff, he was associated
with the Chicago law firm of Peterson, Lowry, RaIl,
Barber, and Ross.
A native of Sawyer, North Dakota, Mr. Knorr
graduated from St. Olaf College in Northfield, Minnesota,
in 1962. He received a Juris Doctor degree from
Northwestern University School of Law in 1965.
Mr. Knorr and his wife, the former Lorelei Olsen
of Billings, Montana, live at 7333 New Hampshire Avenue,
Hyattsville, Maryland. They have one son, Richard Dale.
000
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
June 11, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing June 19, 1969,
in the amount of
$2,702,233,000,
as follows:
91-day bills (to maturity date) to be issued June 19, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated March 20, 1969,
and tc
mature September 18,1969, originally issued in the amount of
$1,100,321,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $1,100,000,000,
dated
June 19, 1969,
and to mature
or thereabouts, to be
December 18, 1969.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Monday, June 16, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec'imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-115
responsible and recognized dealers in.~nvestment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announce.
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The Secre tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank an June 19, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
June 19, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
rS--J
TREASURY DEPARTMENT
WASHINGTON, D.C.
June 11, 1969
FOR IMMEDIATE RELEASE
EXTENSION OF INCOME TAX SURCHARGE URGED
BY SIX FORMER TREASURY SECRETARIES
Six former Secretaries of the Treasury today urged "prompt
action by the Congress to extend the income tax surcharge."
The six -- John W. Snyder, George M. Humphrey, Robert B.
Anderson, Douglas Dillon, Henry H•. Fowler, and Joseph W. Barr,
today released the following statement:
"We are joining together to express our firm
conviction that the financial health of the nation
demands prompt action by the Congress to extend the
income tax surcharge for one year. Combined
with control of expenditures, this is essential to
produce the budgetary surplus so urgently needed to
dampen inflation and maintain orderly financial markets.
"If inflation continues unabated, we will put
into jeopardy the economic prosperity we have all
worked so hard to achieve.
"The risks of inaction are great:
"
At home, rising prices -- and the
expectation of further rises -will create new distortions and
inequities that will unbalance our
economy.
"
Businessmen will continue to see their
goods priced out of foreign markets as
our exports become more expensive
At
the same time, they will see this
inflation produce a strong demand for
imports.
0
K-116
- 2 The burden of fighting inflation cannot be left to
monetary policy alone. Recent developments carrying
interest rates to the highest levels in a century make
plain the severe pressures already operating in
financial markets.
'~e
recognize that important questions of tax
reform remain to be settled at a later date, and we
pronounce no judgment on the structural tax changes
proposed by the Administration.
"But we are united in the conviction that -- in the
interests of the nation's economic stability and its
future prosperity -- extension of the surcharge for one
year must not be delayed."
000
10
TREASURY DEPARTMENT
,
WASHINGTON, D.C.
June 12, 1969
FOR IMMEDIATE RELEASE
TREASURY MARKET TRANSACTIONS IN MAY
During May 1969, market transactions
in Federal Securities of Government accounts
resuited in net purchases by the Treasury
Department of $200,447,000.00.
000
K-117
."<:
_.•...•..
OFFICE OF THE SECRETARY OF THE TREASURY
/)--i
I
WASHINGTON. D.C. 20220
June 11, 1969
MEMORANDUM TO FINANCIAL EDITORS
You no doubt are aware of Secretary Kennedy's
recent remarks concerning inflation and the surcharge.
Those statements were made at "a news conference, in
Washington, June 10.
Since this subject is of continuing interest to
many of your readers, I thought it would be useful
for you to have that portion of the news conference
dealing with that subject.
Sincerely,
~~})
Dixon Donnelley
Special Assistant to the Secretary
(Public Affairs)
Attachment
EXCERPTS FROM REMARKS OF SECRETARY OF THE TREASURY
DAVID M. KENNEDY
AT A NEWS CONFERENCE HELD JUNE 10,1969,
WASHINGTON, D. C.
Opening Statement:
"Since taking office in January, our principal preoccupation, at least at the Treasury, has been ••• the
question of inflation as it relates to fiscal policy •••• "
" ••• the calendar has been running and the June 30
expiration of the surcharge highlights the fact that the
Congress must act and act promptly.
There is a technical
question of the withholding and the schedules, but more
important is the overall inflation problem.
"And we were able to, in our discussions in this
Committee, I think, to isolate and to bring out the issues
and hopefully now the Committee will be able to resolve the
issues and come out with the bill.
And hopefully it will
be the bill recommended by the Administration which would
be the extension of the surcharge to January I next year at
10 percent, and then 5 percent from January to June, with
elimination of the investment tax credit and extension of
the excise taxes.
- 2 "There are various feelings on the part of Congressmen.
Some of them want reform before the extension.
That is
impossible as the calendar lies and as the practical problem
of coming out with a meaningful bill is concerned.
"I think others would wonder whether the surcharge,
when it passed and as it has operated, has effectively
done the job.
But whether those arguments prevail or
whether they don't, it seems to me that from the standpoint
of the economics; and the financial responsibility there is
no question but what we need a full extension as recommended
and also we need assurance on the part of the Administration
and the Congress that we are going to meet head-on the inflation
problem.
"Now that assurance is, I am sure, in the minds and
hearts of the men here, and I believe it is true with
Congressmen and Senators I have talked to.
So ouc problem
is to get the votes now to get this extension. I think as
we look at what has happened, and looking ahead, that the
economy with three and a half years of inflationary
pressures building up has moved so that the problem is
much more difficult than I contemplated.
- 3 -
I~
"The pressures are greater, and I think that it means
that our actions have to be very strong and consistent, and
since January the program of the Administration and of the
monetary policy as handled by the Fed have been working hand
in glove.
And I think that will do the job that we hope to
accomplish in the period ahead.
"It is not the time to reduce taxes, which will take
place if the surcharge is not extended, when our country is
in a period of strong inflationary pressures.
And I think
when that message gets to the Congressmen that they will
give the support that we need to get it through.
And so
much is depending on it, not only in this country, but •••
the eyes of the world are upon us, and the program that we
have been talking to with them is based on our following
sound policies here at home; because if the dollar is not
sound, I don't know what currency on earth can carry the
international monetary mechanism."
QUESTION:
"Mr. Kennedy, are we on the threshhold
of a credit crunch comparable to 1966?
SECRETARY KENNEDY:
"No, I don't think that we
a~e.
We are in a credit stringency, and markets are not good,
but they are not completely disorderly as they were in 1966.
- 4 And I think that the actions that I see on the part of the
banks and upon the financial community that we will not
experience that kind of crunch.
It means, however, that
the lending institutions have got to allocate their funds.
They have got to ration their funds, and I think it means
to say 'No' to credit demands."
QUESTION:
Does this mean you are endorsing the
increase in the prime rate that occurred yesterday?
SECRETARY KENNEDY:
condemning it.
"No, I am not either endorsing or
. •. it seems to me that interest rates
have not been as effective in reducing credit demand or
restricting credit as we have seen in the past, and part
of that is the inflation psychology which the borrower
puts into his decision ... for his request for credit."
QUESTION:
"Sir, if you don't get the surtax extended,
will that mean that using the same fiscal policy you would
have to retrench on your spending?
SECRETARY KENNEDY:
'~ell,
we have done about as much
in the period of time that can be done on the budget.
I
think an excellent job has been done by the Director of
the Budget and his group in getting the departments to cut
I-I
/5 /
- 5 -
back.
Now further cuts should and will be made.
got stops.
They have
They are working now on the '71 budget.
'70 that they can reduce should be reduced.
And any
But the figures
that we have indicated, that they have done about as much as
they can at this time.
QUESTION:
'~at
is your own assessment of chances of
extending the surtax, how close?"
SECRETARY KENNEDY:
that the votes are there.
"I think it will be done.
I think
But it is going to be tight.
is going to be difficult surely.
It
No tax bill goes through
very easily, and I am saying that this is not a question of
increasing taxes.
It is a question of reducing taxes
unless we extend it, because taxes drop down.
fuel in the furnace.
QUESTION:
You get more
So I think that they will do it."
"Mr. Secretary, if there is no extension of
the surcharge, is there a possibility of wage and price
control? "
SECRETARY KENNEDY:
lot of things.
take place.
you don't.
"Well, there is a possibility of a
I am not saying they will, that they will
But you have only two or three avenues if
One would be further budget cuts, one would be
budgetary policies or restrictions in controlling society.
don't want to buy a controlled society."
I
- 6 QUESTION:
"Did you mean that wage and price controls
would be seriously considered if the surtax is not
extended?"
SECRETARY KENNEDY:
QUESTION:
"No, I don't say that.
"Can you clarify what you do mean?"
SECRETARY KENNEDY:
'~ell,
I mean you take a look at
the situation as it goes, to see how strong inflationary
pressures come.
We can't let these escalate and have
runaway inflation in this country.
And we could be very
close to that now."
QUESTION:
"Mr. Secretary, are you leaving open that
question of wage-price control?"
SECRETARY KENNEDY:
"The pol ic y of the Government is not
to have wage and price controls, and at the present time I
see no need for it."
QUESTION:
"Secretary Kennedy, you said that you can't
have runaway inflation, and you mentioned some wage-price
controls as one of the things if you don't get the surcharge.
NOW, does this mean that you would trigger wage-price
controls before you would tolerate runaway inflation?"
- 7 SECRETARY KENNEDY:
/r-T
"As I indicated before, you take
all these things into account, and I have notadvocated and
have not here advocated for you any wage-price controls.
I want that clear.
I said if we have acceleration, and
•
d on ' t reverse -- pr1ces
start to zoom and you have runaway
inflation, you have only the alternatives of going to some
controls or else you have to have monetary policy try to do
the whole job.
QUESTION:
frustrated.
And it would be a question of where you go."
"Mr. Secretary, some Congressmen are
They say they keep voting to increase taxes,
inflation continues, the bankers are getting rich.
How do
you respond to an argument like this?"
SECRETARY KENNEDY:
try to answer them.
"Well, I respond in various ways 1D
But there is no question about the fact
that many people were disappointed -- many in Congress with
the action of the surcharge.
they expected it to do.
It didn't seem to do what
And the question of whether monetary
policy was reversed far too much in the period after the
surcharge was passed, as has been discussed, is one possibility.
But there is the time element.
And it seems to me in the hst
six to eight months is really the test period, when monetary
and fiscal policy have been going hand-in-hand; that the
actions that have taken place since then, I believe, are
bringing the economy into control, and the danger of course
- 8 now is that we reduce taxes and go back in the other
direction.
That is what I am trying to convince the
Congress that they should not do."
rREASURY DEPARTMENT
WASHINGTON. D.C.
IR RELEASE 6:30 P.M.,
nday, June 16, 1969.
RESULTS OF TREASURY S WEEIa..Y BILL OFFERmG
I
Tbe Treasury Department announced that the tenders for two series of Treasury
11s, one series to be an additional issue of bills dated March 20, 1969, and the
her series to be dated June 19, 1969, which were offered on June 11, 1969, were
ened at the Federal Reserve Banks today. Tenders were invited for $1,600,000,OJO,
thereabouts, of 91-day bills and for $1,100,000,000, or ther~abouts, of 182-day
lIs. The details of the two series are as follows:
NGE OF ACCEPTED
MPETITIVE BIDS:
High
Low
Average
80%
91-day Treasury bills
SeEtember 18 z 1969
Approx. Equiv.
Price
Annual Rate
98.321
6.642~
98.311
6.682%
98.315
6.666%
ma.turin~
Y
182-day Treasury bills
December 18 z 1969
Appr:>x. Equiv.
Price
Annual Rate
--.-96.643
6~640%
96.623
6.680%
96.636
6.654%
~/
maturin~
of the amount of 91-day bills bid for at the low price was accepted
of the amount of 182-day bills bid for at the low price was accepted
98~
rAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Soston
~ew York
?hilade 1phia
;leve1and
Uchmond
~tlanta
~hicago
't. Louis
otlnneapolis
lansas City
lallas
>an Francisco
IDTALS
AEElied For
AcceEted
$ 32,154,000 $ 17,374,000
2,163,835,000
1,298,119,000
17,873,000
35,035,000
69,184,000
31,038,000
45,948,000
25,538,000
22,090,000
55,202,000
50,552,000
130,331,000
39,482,000
66,304,000
6,286,000
24,136,000
22,402,000
29,853,000
13,326,000
23,826,000
56,149,000
164, 634".Q22
$2,840,442,000
AEE1ied For
4,983,000
$
1,866,651,000
19,192,000
42,239,000
31,597,000
37,001,000
120,501,000
47,920,000
23,549,000
23,650,000
28,378,000
128 z 712 z 000
AcceEted
4,574,000
$
928,487,000
8,206,000
23,344,000
13,596,000
13,840,000
34,931,000
18,420,000
6,749,000
19,400,000
11,078,000
18,087,000
$1,600,229,000 ~I $2,374,373,000
$1,100,712,000
E(
Includes $322 839 000 noncompetitive tenders accepted at the average price of 98.315
Includes $191'591' 000 noncompetitive tenders accepted at the average price of 96.636
~se rates ~ o~ a bank discount basis. The equivalent coupon issue yields are
6.8~ for the 91-day bills, and 6.98 % for the 182-day bills.
TREASURY DEPARTMENT
WASHINGTON, D.C.
June 18, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing June 26, 1969,
in the amount of
$2,705,288,000,
as follows:
9l-day bills (to maturity date) to be issued June 26, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated March 27, 1969,
and to
mature September 25, 1969, originally issued in the amount of
$1,100,689,000,
the additional and original bills to be
freely interchangeable.
183-day bills, for $1,100,000,000,
dated June 26, 1969,
and to mature
or thereabouts, to be
December 26, 1969.
The bills of both series will be issued on a discount basis under
competitive and -noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $JOO,OOO and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, June 23, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"ima1s, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-118
-
L -
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public ann ounc I
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The Secre tary of the
Treasucy expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on June 26, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing June 26, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are ex~mpt from all taxation now or hereafte~ imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0bo~ranch.
, ~o
rREASURY DEPARTMENT
WASHINGTON, D.C.
June 18, 1969
. FOR IMMEDIATE RELEASE
TREASURY'S MONTHLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$1,700,000,000, or thereabouts, for cash and in exchange for
:Treasury bills maturing
June 30, 1969,
in the amount of
:$ 1,702,711,000,
as follows:
274-day bills (to maturity date) to be issued June 30, 1969,
.in the amount of $500,000,000,
or thereabouts, representing an
additional amount of bills dated March 31, 1969,
and to
mature March 31, 1970,
originally issued in the amount of
$1,000,536,000,
the additional and original bills to be
freely interchangeable.
365-day bills, for $1,200,000,000,
or thereabouts, to be
iated June 30, 1969,
and to mature June 30, 1970.
The bills of both series will be issued on a discount basis under
and noncompetive bidding as hereinafter provided, and at
naturity their face amount will be payable without interest. They
~ill be issued in bearer form only, and in denominations of $1,000,
~5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
~ompetitive
Tenders will be received at Federal Reserve Banks and Branches
Ip to the closing hour one-thirty p.m., Eastern Daylight Saving
:ime, Tttesday, June 24, 1969.
Tenders will not be
'eceived at the Treasury Department, Washington. Each tender must
Ie for an even multiple of $1,000, and in the case of competitive
:enders the price offered must be expressed on the basis of 100,
'ith not more than three dec"ima1s, e. g., 99.925. Fractions may not
)e used. (Notwithstanding the fact that the one-year bills will run
:or 365 days, the discount rate will be computed on a bank discount
lasis of 360 days, as is currently the practice on all issues of
'reasury billso) It is urged that tenders be made on the printed
·orms and forwarded in the special enbelopes which will be supplied
Y Federal Reserve Banks or Branches on application tre refor.
Banking institutions generally may sub~it tenders for account of
lstomers provided the names of the customers are set forth in such
~nders.
Others than banking institutions will not be permitted to
K-IIQ
submit tenders except for their own account. Tenders will be recei~d
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers ~n investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announCI
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The Secre tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on June 30, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
June 30, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and thiS
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0ho~ranch. ,
TREASURY
WASHINGTON, D.C.
June 19, 1969
NOTICE TO THE PRESS
Governor Guido Carli of the Bank of Italy
will meet with Secretary Kennedy at Treasury
at 11:30 A.M., Monday, June 23.
Governor Carli plans to visit the United
States to confer with officials of a number of
major New York banks, and will take the
opportunity to meet with Mro Kennedy for the
first time since Mr. Kennedy became Secretary
of the Treasuryo
Their informal discussions
are expected to cover financial matters of
mutual interest to the United States and Italy.
000
FOR RELEASE ON DELIVERY
It L--
STATEMENT BY THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
BEFORE THE
HOUSE COMMITTEE ON BANKING AND CURRENCY ON
INTEREST RATES
THURSDAY, JUNE 19, 1969, 2:00 P. M.
Mr. Chairman and Members of the Committee:
I understand the purpose of today's hearing is to seek
answers to two important questions:
(1) What were the reasons behind the recent increase
in the bank prime lending rate of 8-1/2 percent?
(2) What policies should the Federal government follow
to create conditions that will result in a lower
level of interest rates?
It is essential that we consider these questions, and
I welcome this opportunity to offer some observations on
them.
The high level of interest rates which exists today
is largely the result of three major influences.
First, the overall demand for credit remains strong.
This large demand is stimulated by continued economic
expansion in a broad range of economic activities,
especially for the financing of capital investment
K-120
0
The
- 2 demand is reinforced by the expectation of continued
inflation.
Second, the behavior of interest rates is peculiarly
distorted by the impact of inflation, both actual and
expected.,
Interest is the price paid by a borrower for
the advantage of using a fixed sum of money now and repaying
the same fixed sum at a future date.
When there is an
expectation of stable prices, the interest rate reflects
a normal return on capital and a risk adjustment based on
the borrower's credit-worthiness.
But when the expectation
of unabated inflation is widespread, the unprotected
lender must charge -- and the borrower is willing to pay -a premium to compensate for the decline in purchasing power
of the funds to be repaid.
The incorporation of this
inflation-adjustment charge into credit contracts is a major
factor in today's high level of rates.
Third, the large role played by monetary policy in the
effort to control inflation has put substantial upward
pressure on interest rates.
Monetary policy influences
real economic activity through changes in bank credit and
money supply.
A program of economic restraint which relies
- 3 -
heavily on monetary policy, thereby restricting the supply
of money and credit, is likely to lead to higher interest
rates in the short run.
Of course, as inflation is brought
under control, interest rates can logically be expected to
decline.
I believe these three influences -- strong demand for
credit, excessive inflation, and heavy reliance on monetary
policy -- basically explain the general level of interest
rates.
My primary concern, Mr. Chairman, is with the second
question under consideration today -- what policies should
the government follow to create conditions that will
result in a lower level of interest rates?
I assure you
thai no one in this hearing room is more anxious to see
lower interest rates than the Secretary of the Treasury.
This Administration is determined, therefore, to pursue
anti-inflationary policies which offer the most promise
for achieving effective relief from the current rates
o
- 4 The appropriate policy prescription for achieving the
desired reduction in the level of interest rates is clearly
dependent upon the real nature of the current problem.
If,
for example, today's rates were the result of concerted
discretionary action by large banks with the power to
escape normal market tests, which I do not believe is the
case, then a possible course of policy would be to seek
legal remedies.
If, on the other hand, these high rates
are fundamentally the result of the three major influences
I have outlined, then the proper policy is one of strong
fiscal restraint, expenditure reduction, and surtax
extension -- such as this Administration has proposed.
I have a deep appreciation for the widespread concern
expressed over the recent prime rate increase.
Indeed, I
have previously made clear my serious doubts as to the
ability of interest rate increases to effectively ration
credit at this time, and I would today urge all lenders
to use other methods to make those difficult credit
allocation decisions which the present situation clearly
demands.
We are entitled to expect such responsible
behavior from our financial institutions o
They, in return
are entitled to expect the government to take the actions
that are necessary to restrain inflation o
/
- 5 -
/#
!
I do not, however, favor reliance upon a strategy of
selective application of administrative pressures to force
particular firms in competitive industries to reduce prices.
This approach merely treats symptoms, not basic causes, and
provides no effective or lasting relief from the problem of
inflatio~.
A policy of selective government intervention to roll-back
price increases knows no limits in actual application.
does one draw the line?
Where
The Administration has been urged
not only to roll-back the prime rate, but also to take
direct action against increases in certain commodity prices
and in construction industry wages.
This arbitrary approach
is ineffective, without legal sanction, and devoid of clear
guidelines or effective remedies for the firms involved.
Moreover, such action in the case of interest rates can
increase demand and inflationary pressures and adversely
affect certain sectors of the economy, such as housing.
All of this emphasizes the pressing need for full
extension of the surcharge, as reported by the House Ways
and Means Committee, and enactment of the other fiscal
measures proposed by this Administration.
Inflation
and inflationary expectations have taken a very strong hold
on the economy.
The prime rate increase is the latest
- 6 -
dramatic evidence of that fact.
Any backing away now from
our policy of restraint -- any reduction in tax rates while
prices are climbing at a rate of six percent a year -- is
simply an invitation to more and more inflation and,
ultimately, a severe and painful economic adjustment.
000
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE
EXCERPTS OF REMARKS OF EUGENE T. ROSSIDES
ASSISTANT SECRETARY OF THE TREASURY
BEFORE THE MEMBERS OF THE
ASSOCIATION OF FEDERAL INVESTIGATORS
PRESIDENTIAL ARMS HOTEL, WASHINGTON, D. C.
JUNE 19, 1969
12:00 NOON
Introduction
I welcome the opportunity to visit with the
Association of Federal Investigators.
Your motto--"To be faithful in the pursuit of
truth;" your purpose--to promote the professional
status of the investigator; and your objective--to
establish ethical professional standards of work and
conduct--are a testament to your goal of enhancing
investigation as a profession.
You can be justly proud of the expanding role
of your association in fostering better law enforcement. The Treasury Department's role and efforts in
law enforcement are also expanding as a result of the
high priority President Nixon has given to effective
law enforcement.
Treasury's Role in Law Enforcement
The Secretary of the Treasury, David M. Kennedy,
stated earlier this year that the full resources of
the Treasury Department--including each of its
investigative and enforcement arms--will be used as
needed in pressing the war against crime.
Secretary Kennedy has upgraded the status of
Treasury law enforcement by putting it under the
supervision of an Assistant Secretary. My responsibilities
as Assistant Secretary for Enforcement and Operations
include, among others, serving as "principal advisor to
the Secretary on all law enforcement matters;" direct
-2supervision of the Secret Service, the Bureau of Customs
and the Treasury Law Enforcement School; and providing
policy guidance for all Treasury law enforcement activities,
including those of the Internal Revenue Service.
In discussing these responsibilities with me,
Secretary Kennedy stressed the importance of the Treasury's
law enforcement role; that it is the second largest law
enforcement department in the Federal Government; that, in
the past, law enforcement at the Treasury has not had the
attention it deserved from the Office of the Secretary and
that it is my responsibility to see to it that the old
situation is changed.
The Secretary has instructed the General Counsel,
Paul Eggers, to take an active role in the Treasury's
law enforcement effort. This is another example of the
Secretary's determination to strengthen law enforcement
at the Treasury.
The Secretary has directed that a particular effort
be made to convey to the several thousand Treasury Agents
the full support of this Administration for a maximum law
enforcement effort.
The Secretary stressed that, in addition to the
overriding protective mission of the Secret Service, two
programs were to be given priority:
1.
Prevention of the smuggling of narcotics,
marihuana, and other contraband drugs into
the United States; and
2.
The fight against organized crime.
Smuggling of Narcotics, Marihuana,
and Other Contraband Drugs
There is no greater concern in the American household
today than the problem of the use of narcotics, marihuana,
and other dangerous drugs by our youth. These drugs slash
across the entire fabric of family life.
It is common knowledge that practically all of the
heroin and high-potency marihuana that is used in the
United States is grown and refined abroad and smuggled into
the United States. On the other hand, an increasing amount
of the low-potency marihuana is being grown here for
domestic consumption.
-3President Nixon, in a statement in Anaheim, California,
on September 16, 1968, stressed the danger from these drugs.
He referred to the Treasury's Bureau of Customs responsibilities
for preventing smuggling and recommended a substantial increase
in Treasury Agents for Customs and noted that this was also
urged by the President's Crime Commission.
Secretary Kennedy has put great stress on the Treasury's
responsibility in this area. Following the directive from
Secretary Kennedy, and in consultation with the Commissioner
of Customs, we have organized a Contraband Drug Section in
the Enforcement Division of the Bureau of Customs.
We have started a special training course for Customs
Inspectors so that they will be up to date on the newest
methods and techniques for detecting contraband drugs
being smuggled into the United States.
Treasury Efforts Against Organized Crime
The Treasury Department is making a major effort in
support of the Administration's drive against organized
crime as set down in the President's message to Congress
on April 23, 1969.
Secretary Kennedy's instructions were brief and
explicit--full cooperation on a full-partnership basis
with the Justice Department and other agencies of the
Federal Government in the drive against organized crime.
Treasury Agents of the Internal Revenue Service,
the Secret Service, and the Bureau of Customs will
continue to work and cooperate with other agencies in
the detection of wrong-doing and the development of
evidence leading to the prosecution of those who have
violated the law.
The Treasury Department will provide a major part
of the manpower in the expanded effort against organized
crime.
As President Nixon has said:
"The time has come
to fight organized crime with a will to win the battle."
-4Partnership with Department of Justice
Those of us in the Administration take great pride
in the leadership of Attorney General John Mitchell,
Deputy Attorney General Richard Kleindienst, and Assistant
Attorney General Will Wilson, who is in charge of the
Criminal Division.
We at Treasury are pledged to full cooperation with
the Department of Justice. General Counsel Eggers and
I have conferred with the Attorney General, with the
Deputy Attorney General, and with Assistant Attorney
General Will Wilson on numerous occasions.
I will venture
a prediction that one of the hallmarks of this Administration will be the closest cooperation possible between
these two great departments.
The Profession of the Investigator
Law enforcement is a profession.
Its work involves
the safety of all of us.
It requires education and
training, judgment and dedication.
The proper investigation of a ca.se is the foundation
for every successful prosecution or plea.
In my judgment,
the difficult, exacting, and important role of the investigator is neither fully appreciated nor fully rewarded
by the general public or attorneys.
In effective enforcement of our criminal laws, there
are two essential roles--the role of the investigator of
the violation of the laws, and the role of the prosecutor
of violations.
If the investigator does his job properly,
the prosecutor usually has no difficulty in obtaining a
plea or conviction.
The best prosecutor is the one who understands that
law enforcement is a joint effort between investigator
and prosecutor and who treats the investigator as a
professional man and on an equal footing.
Much greater recognition must be given to the role
of the investigator and the crucial importance of his
work.
In assisting in the enforcement of our criminal
laws, he is in the forefront of the fight for individual
freedom in this country. Just as the armed forces are
the protectors of the freedom of the nation, the
investigator's work protects the freedom of the individual
and enables the average citizen to enjoy his freedom--to
enjoy his rights--and to respect the freedom and rights
of his fellow men.
(~1
-5-
As I review the events of the past year, it seems
to me that perhaps the general public is beginning to
appreciate the role of the law enforcement officer.
Cooperation and Teamwork
Today no profession, no organization, has escaped
the modern trend of industrial society toward complexity
and interdependence. Our modern, industrial society
places a premium on teamwork, experience, and specialization in law enforcement as it does in other professions.
This teamwork, this cooperation, is on many levels.
It is between investigators and prosecutors as well as
among investigators. There is no better example of the
teamwork required in law enforcement than in the strike
force concept which Attorney General Mitchell and
Assistant Attorney General Wilson have done so much to
strengthen and give direction to.
In the strike force
there is need for cooperation among investigators and
for cooperation between the investigators and the
prosecutors.
The President of the United states submits his
program to the Congress; the Congress enacts the
legislation; and the judiciary decides cases arising
under th~ legislation.
Headlines result from each o£
these activities.
In the final analysis, however, it
is the men in the field, in this case, the investigators,
the quiet men throughout the nation, who have to enforce
the laws.
Your diligence and your dedication are
essential to the proper functioning of our government.
Your role is accepted, although it has not been
given enough recognition. There is a presumption of
your ability and diligence and integrity.
It is a
tribute that the law enforcement officer is not asked
if he can do the job.
It is presumed that he can.
You have met the challenge in the past, but the challenge
of the future is even greater as we move on organized
crime and the effort to stop the smuggling of narcotics,
marihuana, and other dangerous drugs.
President Nixon visited each of the Departments of
Government. These were important visits as they dramatized
the President's conviction that the success of his programs
and of his Administration "depends not just on a few leaders
at the top, but it depends also on the dedication and the
sense of mission of every individual up and down the line."
-6-
The partnership within Government--between the
national Administration and the career personnel-is essential for a successful national administration.
The key word, in my judgment, is partnership--working
together to accomplish the enormous tasks of government.
In closing, I would stress that it is not an
overstatement to say that the cooperative efforts and
dedication of the thousands of men and women in Federal
law enforcement activities are essential to the success
of this Administration.
* * * *
TREASURY DEPARTMENT
WASHINGTON, D.C.
June 23, 1969
FOR IMMEDIATE RELEASE
MURRAY L. WEIDENBAUM SWORN IN AS ASSISTANT
SECRETARY OF THE TREASURY FOR ECONOMIC POLICY
Murray L. Weidenbaum, former Professor and Chairman of the
Department of Economics of Washington University, St. Louis,
Missouri, was sworn in today as Assistant Secretary of the
Treasury for Economic Policy by David M. Kennedy, Secretary of
the Treasury.
Mr. Weidenbaum, 42, holds a Doctor's Degree from Princeton
University, a Master's Degree from Columbia University and a
Bachelor's Degree from City College of New York. He has been a
member of the Washington University faculty since 1964.
As Assistant Secretary for Economic Policy, Mr. Weidenbaum
will have special responsibilities for economic and financial
analysis in the areas affecting Treasury Department activities
and policies
0
Secretary Kennedy noted that Mr. Weidenbaum "has been an
economist in three worlds -- government, private industry, and
academic life," and that he brings to the Treasury "a wealth
of experience."
From 1958 to 1963, Mr. Weidenbaum was Corporate Economist
for the Boeing Company in Seattle, Washington. During his
careet, Mro Weidenbaum has concentrated on government and public
finance. From 1949 to 1957 he was an economist in the Bureau
of the Budget, specializing in fiscal policy. His experience
in government and industry includes a wide range of assignments
as an economic consultant on task forces and study groups.
Assistant Secretary Weidenbaum is a member of the Board
of Governors of the National Economists Club and has served
on advisory committees of several professional associations,
including the American Economic Association and the American
Statistical Association. He is a Charter Member of the
National Association of Business Economists.
(OVER)
K-121
- 2 •
Mr. Weidenbaum has written extensively about public finance,
defense and disarmament economics, and industrial economics. His
by-line has appeared on scores of articles, chapters of books,
anthologies, magazine articles, and scholarly studies in finance
and economics.
Mr. Weidenbaum is married to the former Phyllis Green.
They have three children and will make their home in Chevy Chase,
Maryland.
000
-REASURY DEPARTMENT
WASHINGTON. D.C.
RELEASE 6: ~'SO P.M.,
day, June (:;3, 1969.
RESULTS OF 'rnEASPRY' S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
Is, one series to be an additional issue of the bills dated March 27, IJE9. and the
er series t:) be dated June 26, 1969, which were offered on June 18, 1969, were
ned at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
thereabouts, of 91-day bi l1s and for $1,100,000,000, or thereabouts, of 183-day
Is. The detaj 1::; of the tw:) series are as follows:
GE OF ACCEPTED
PETITIVE BIDS:
High
Low
Average
91-day Treasury bi Us
SeEtember 25 z 1969
Approx. Equiv.
Price
Annual Rate
6.476~
98.363
98.344
6.551%
6.524%
98.351
ma.turin~
1/
183-day Treasury bi 11s
December 26 z 1969
Approx. Equiv.
Pri.ce
Annual Rate
6.803%
96.542 f!.!
6.93r:if,
96.477
6.866~
96.510
maturin~
!/
al
F.xceDt 1 tender of ~1, 000
ot'the amount of 91-day bills bid for at the low price was accepted
5% of the amount of 183-day bills bid for at the low price was accepted
3C/fo
AL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
trict
ton
York
ladelphia
veland
hmond
anta
cago
Louis
neapolis
Gas City
las
Francisco
'roTAI.S
AEElied For
AcceEted
23,215,000
7,404,000
$
$
1,404,950,000
1,053,921,000
21,231,000
22,831,000
32,142,000
64,091,000
12,591,000
20,946,000
36,096,00')
30,664,000
189,354,000
198,577,000
36,805,000
42,397,000
4~,907,OOO
19,188,000
23,032,000
26,432,000
28,651,000
42,278,000
48,521,000
25,629,000
17,077,000
27,()77,000
82
61 z318,000 : ,
z115 z 000
121 z 2,18 z O()O
$2,623,102,000 $1,600,347,000 EI $1,896,156,000
ApElied For
$ 33,215,000
1,870,589,000
38,426,000
75,270,000
23,446,000
46,464,000
262,537,000
AcceEted
7,404,000
:$
746,450,000
11,231,000
32,142,000
10,091,000
24,296,000
155,454,000
28,305,000
10,688,000
21,816,000
16,629,000
35,534 z 000
$1.100,040,000
:=./
Includes $387,414,000 noncompetitive tenders accepted at the average price~f 98.351
Includes $198,383,000 noncompetitive tenders accepted at the average price of 96.51C
These rates are on a bank discount basis. The equivalent coupon issue yields are
6.73% for the 91-day bi 11s, and 7.21% for the 183-day bills.
~EASURY
DEPARTMENT
4
RELEASE 6: 30 P.M.,
day, June 24, 1969.
WASHINGTON. D.C.
RESULTS OF TREASURY'S MONTHLY BILL OFFERING
'!be Treasury Department announced that the tenders for two series of TreasUl")'
s, one series to be an additional issue of the bills dated March 31, 1969, and
other series to be dated June 30, 1969, which were offered on June 18, 1969, were
ed at the Federal Reserve Banks today. ~nders were invited for $SOO, 000, 000,
hereabouts, of 274-day bills and for $1,200,000,000, or thereabouts, of 365-4&y
s. '!be details of the two series are as follows:
274-day Treasury bills
March 31 z 1970
Approx. Equiv.
Price
Annual Rate
94.459 Y
1.280%
94.299
7.49~
94.378
7.387~
E OF ACCEPrED
ETITIVE BIDS:
maturi~
High
Low
Average
Y
365-day Treasury bills
maturing June 30, 1970
Approx. Equiv .
Price
Annual Rate
92.654 '§}
7. 245~
92.528
7.37~
92.556
7.342~
11
~ Excepting 4 tenders totaling $5,275,000; ~ Excepting 2 tenders totaling
$5,ooo,ooc
27% of the amount of 274-day bills bid for at the low price was accepted
17% of the amount of 365-day bills bid for at the low price was accepted
L TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
strict
ston
'" York
lladelphia
eve land
chmond
lanta
1cago
. Louis
nne apolis
nsas City
llas
n franCisco
'roTALS
Acce12ted
For
601,000
601,000 $
396,884,000
990,134,000
2,434,000
8,434,000
1,056,000
1,056,000
778,000
778,000
16,373,000
20,873,000
16,061,000
52,361,000
16,440,000
17,305,000
1,050,000
11,050,000
2,044,000
2,044,000
1,201,000
11,201,000
45,293,000
60,673,000
A1212lied For
$ 11,554,000
2,030,647,000
25,699,000
13,014,000
4,592,000
13,792,000
128,956,000
24,440,000
10,695,000
6,875,000
12,267,000
132,864,000
$ 500,215,000
~/ $2,415,395,000
A~lied
$
$1,176,510,000
Acce12ted
$
1,054,000
1,082,254,000
3,699,000
3,864:,000
2,092,000
4,292,000
29,777,000
9,940,000
695,000
3,875,000
2,267,000
__56,364,000
$1,200,173,000 ~
Includes $17,306,000
noncompetitive tenders accepted at the average price at 94:.378
Includes $47,486,000
noncompetitive tenders accepted at the average price ot 92.556
7hese rates are on a bank discount basis. The equivalent coupon issue yields are
7.83~ for the 274-day bills, and 7.89 ~ for the 365-day bills.
K-122
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
June 25, 1969
FOR RELEASE P.M. NEWSPAPERS
WEDNESDAY, JUNE 25, 1969
K. MARTIN WORTHY SWORN IN AS
CHIEF COUNSEL FOR INTERNAL REVENUE SERVICE
K. Martin Worthy was sworn in at 2:00 p.m. Wednesday,
June 25, as Chief Counsel of the Internal Revenue Service and
Assistant General Counsel of the UoS. Treasury.
Treasury Secretary David M. Kennedy announced appointment
of Mr. Worthy on May 24 and the Senate confirmed the appointment last week.
Mr. Worthy has specialized in a tax law practice for
more than 20 years with the Washington firm of Hamel, Morgan,
Park and Saunderso He is vice-chairman of the Taxation
Section of the American Bar Association and has served as a
Council director and chairman of the Bar Association's
committee responsible for government relationso He was also
a member of the Tax Advisory Group of the American Law
Institute from 1963 to 1968 and in 1957-58.
Mr. Worthy, who is 48, is a native of Dawson, Georgia.
He was graduated from Emory University, Atlanta, Georgia, and the
university Law School. He then attended the Harvard University
Graduate School of Business, where he received the Master of
Business Administration degree cum laude o
Mr. Worthy is a lay member of the Finance Department of
the Episcopal Diocese of Washington and a director of the
National Association of Citadel Meno
He served in the U.S. Army from 1943 to 1946, rising from
Second Lieutenant to Captain~ and again in 1951-52 as a Captain
in the Army Judge Advocate Corpso
Mr. Worthy is married to the former Eleanor Vreeland
Blewett of Newport News, Virginia. They have a son and a
daughter. Their home address is 5305 portsmouth Road,
Bethesda.
000
K-123
TREASURY DEPARTMENT
(
WASHINGTON. D.C.
June 23, 1969
FOR IMMEDIATE RELEASE
UNITED STATES AND TURKEY TO DISCUSS
INCOME TAX TREATY
The Treasury Department announced today that
representatives of the United States and Turkey will
begin discussions in Ankara in mid-September on a
proposed bilateral income income tax treaty.
Currently, there is no income tax treaty existing
between the two countries.
The proposed treaty is intended to avoid double
taxation and otherwise facilitate trade and investment
between the two countries.
It will be concerned with the
tax treatment of income of individuals and companies from
business, investment, and personal services.
The "model" income tax treaty developed by the
Organization for Economic Cooperation and Development
will be taken into account along with recent United States
treaties with other OECD member countries, such as the treaty
with France which went into force in August, 1968.
Persons wishing to comment or submit information
concerning the proposed treaty are requested to do so in
writing by September 1, 1969. Material should be submitted
to Edwin S. Cohen, Assistant Secretary of the Treasury,
Treasury Department, Washington, D. C. 20220
000
K-124
TREASURY DEPARTMENT
/l 3
WASHINGTON. D.C.
June 25, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by
for two series of Treasury bills
$2,700,000,000, or thereabouts,
Treasury bills maturing July 3,
$2,704,845,000,
as follows:
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
1969,
in the amount of
91-day bills (to maturity date) to be issued July 3, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated April 3, 1969,
and to
mature
October 2, 1969, originally issued in the amount of
$1,100,404,000,
the additional and original bills to be
freely interchangeable.
183-day bills, for $1,100,000,000,
dated
July 3, 1969,
and to mature
or thereabouts, to be
January 2, 1970.
The bills of both series will be issued on a discoun~ basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Daylight Saving
time, Monday, June 30, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec-imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-125
- zresponsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announc
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 3, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
July 3, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority,
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of.
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
June 25, 1969
FOR IMMEDIATE RELEASE
COSTANZO TO BE NOMINATED FOR
MINT'S NEW YORK ASSAY POST
Secretary of the Treasury David M. Kennedy announced
today that President Nixon plans to nominate Nicholas
Costanzo, Middletown, New York, real estate and insurance
broker as Superintendent of the United States Assay Office
in New York City.
The Assay Office, charged with the
custody and processing of gold and silver bullion, is
part of the Treasury's Bureau of the Mint.
Mr. Costanzo, 52, has been active in city and county
civic affairs in Orange County, New York.
He attended
Drake University and served in the U.S. Army during
World War I I.
000
K-126
TREASURY DEPARTMENT
WASHINGTON. D.C.
June 26, 1969
FOR IMMEDIATE RELEASE
TREASURY DEBT MANAGEMENT OFFICIAL R. DUANE SAUNDERS,
RESIGNS TO ENTER PRIVATE INDUSTRY
Secretary of the Treasury David M. Kennedy today
announced the resignation effective July 19 of
R. Duane Saunders, his Special Assistant for
Debt Management.
Mr. Saunders, who lives in Alexandria, Virginia,
has been with the Treasury Department since 1941
and who has held his present post since 1966,
plans to enter private industry.
Secretary Kennedy commended Mr. Saunders for
his many years of valued service to the Department, and
expressed his particular pleasure for the assistance
"you have so willingly provided me during this difficult
period of transition."
In 1964, Mr. Saunders was awarded the Department's
Exceptional Service Award for his work in formulating
department policies and decisions in the management
of the public debt and broadening understanding of
debt management.
000
TREASURY DEPARTMENT
,
11 c,
WASHINGTON, D.C.
June 25, 1969
FOR RELEASE A.M. NEWSPAPERS
THURSDAY, JUNE 26, 1969
MYLES J. AMBROSE NAMED
COMMISSIONER OF CUSTOMS BUREAU
Secretary David M. Kennedy announced today the appointment of Myles J. Ambrose, New York attorney, as Commissioner
of Customs.
Mr. Ambrose will assume his duties on August 4. He
succeeds Lester D. Johnson, who is retiring. Mr. Ambrose
will direct the operations of the 9,000-person bureau under
the supervision of Assistant Secretary Eugene T. Rossides.
In making the announcement, Secretary Kennedy said,
"Mr. Ambrose's demonstrated administrative ability and
his wide enforcement experience make him ideally suited
to assume this major responsibility.
"As the Treasury strengthens its campaigns against
the smuggling of narcotics, marihuana, and contraband
drugs, and against organized crime, we are fortunate to have
a person of Mr. Ambrose's experience at the head of the
Customs Bureau."
Mr. Ambrose, 42, served as Administrative Assistant
U.S. Attorney for the Southern District of New York during
1954-57. In 1957 he became the Assistant to the Secretary
for Law Enforcement at Treasury, serving as coordinator of
its national and international enforcement activities until
1960
From 1960-63, Mr. Ambrose served as Executive
Director of the Waterfront Commission of New York Harbor.
He has been in the private practice of law since that time.
From 1963 to 1965 he also served as Chief Counsel of the
New York State Joint Legislative Committee for the Study
of the Alcoholic Beverage Control Law.
0
K-127
(OVER)
- 2 He was chairman of the U.S. Delegation to the 27th
and 28th General Assemblies of the International Criminal
Police Organization (INTERPOL) in London and Paris, and
U.S. observer in Geneva in 1958, at meetings of the
United Nations Economic and Social Council Commission on
Narcotics.
In 1960 he served as chairman of the U.S. Delegation
in the Joint Mexican-United States Conference on Narcotics.
He attended similar meetings in Mexico City held this
June 9-11, 1969, as a consultant.
From 1955-57 he was an instructor at Manhattan College
in the Economics of Labor and Industrial Relations.
Mr. Ambrose is a member of the New York and
Westchester County Bar Associations and the Association'
of the Bar of the City of New York; International
Association of Chiefs of Police; Guild of Catholic Lawyers;
and the Friendly Sons of St. Patrick, New York. He is a
trustee of the New Hampton School.
Born in New York City on July 21, 1926, Mr. Ambrose
was graduated from New Hampton School, New Hampshire;
Manhattan College (B.B.A., 1948); and the New York Law
School (J.D. 1952). He is married to the former
Elaine Miller, and they have three boys and three girls.
000
)11
rREASURY DEPARTMENT
,
WASHINGTON, D.C.
'OR RELEASE 6: 30 P.M.,
:Ionday, June 30, 1969.
RESULTS OF TREASURY I S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
dlls, one series to be an additional issue of the bills dated April 3, 1969, and the
)ther series to be dated July S, 1969, which were offered on June 25, 1969, were
1p€ned at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
lr thereabouts, of 91-day bills and for $1,100,000,000, or thereabouts, of 183-day
.' Jills. The details of the two series are as follows:
~GE OF ACCEPTED
:OMPETITIVE BIDS:
High
L~'W
Average
91-day Treasury bills
maturinei October 2 z 1969
Approx. Equiv.
Price
Annual Rate
98.400
6.33OJ
98.328
6.615~
98.368
6.456~ !/
183-day Treasury bills
maturin€i January 2 z ) 970
Approx. Bquiv.
Price
Annual Rate
96.512 !!
6.862~
96.422
7.03~
96.470
6.944i
Y
~/ Excepting 4 tenders totaling $707,000
56% of the amount of 91-day bills bid for at the low price was accepted
69% of the amount of 183-day bills bid for at the low price was accepted
)TAL TENDERS APPLIED nR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New Y0rk
Phi lade lphia
C:eveland
Richmcmd
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Delles
San FranCisco
roTALS
Acce}2ted
A1212lied For
$ 42,813,000 $ 32,813,000
1,048,201,000
1,815,401,000
27,208,000
42,208,000
34,489,000
34,489,000
22,189,000
22,190,000
49,307,000
49,307,000
152,583,000
152,593,000
51,206,000
51,206,000
24,187,000
24,187,000
32,015,000
32,015,000
20,434,000
27,434,000
105,552,000
110,552,000
$2,404,395,000
$1,600,184,000~
A1212lied For
4,997,000
$
1,531,833,000
19,048,000
27,547,000
11,636,000
35,237,000
12l.,860,:100
28,955,000
18,253,000
23,059,000
27,068,000
88,828,000
Acce}2ted
4,997,000
$
743,633,000
9,04'3,000
27,547,000
11,636,000
35,237,000
116,860,000
28,455,000
18,253,000
23,059,000
18,068,000
63,328,000
$1,938,321,000
$1,100,121,000~/
Includes $371,817,000 noncompetitive tenders accepted at the average price of 98.368
Includes $205,693,000 noncompetitive tenders accepted at the average price of 96.470
These rates are on a bank discount basis. The equivalent coupon issue yields are
6.65~ for the 91-day bills, and 7.3~ for the 183-day bills.
TREASURY DEPARTMENT
=
FOR RELEASE AFTER 5:30 P. M.
TUESDAY, JULY 1, 1969
NICHOLAS G. THEODORE TAKES OATH AS SUPERINTENDENT
OF THE UNITED STATES MINT AT PHILADELPHIA
Nicholas G. Theodore, a Delaware County lawyer and accountant, was
sworn in today as the 15th Superintendent of the Philadelphia Mint. The oath
was administered by U. S. District Judge John B. Hannum, at a ceremony
held in the new mint building on Independence Mall.
Mr. Theodore, 31 years old, was nominated by President Richard Nixon
for this post on May 5, and confirmed by the Senate on May 20, 1969. He
will be responsible for the planning and coordination of all activities of the
Philadelphia Mint.
The new Mint, to be officially opened at a ceremony on August 14, 1969,
will be in full operation early in 1970. It will be capable of producing
8 billion coins annually. The present Mint produced 2. 4 billion domestic
coins, and 144 million foreign coins, during calendar year 1968. The
domestic coins had a face value of more than 114 million dollars.
Mr. Theodore is a member of the Delaware County Bar, the Delaware
County Bar Association, the Supreme and Superior Court of Pennsylvania,
and the Federal District Court for the Eastern District. In 1964 he became
associated with the law firm of Mowatt, McErlean, Pinto, Theodore and
Rubin, in the general practice of law. Prior to appointment to his present
post, Mr. Theodore was the First Assistant Public Defender for Delaware
County.
Born on September 23, 1937, Mr. Theodore received his early education
at the Canterbury School, New Milford, Connecticut. He received his
Doctor of Law Degree from Villanova School of Law and a Bachelor1s Degree
from the University of Notre Dame.
He is married to the former Patricia Ann Kilmon. They reside in
Middletown Township, Delaware County, Pennsylvania.
000
K-128
TREASURY DEPARTMENT
,
WASHINGTON, D.C.
July 2, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing
July 10, 1969,
in the amount of
$ 2,703,920,000,
as follows:
9l-day bills (to maturity date) to be issued July 10, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated April 10, 1969,
and to
mature
October 9, 1969, originally issued in the amount of
$1,101,261,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $ 1,100,000,000,
dated
July 10, 1969,
and to mature
or thereabouts, to be
January 8, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Monday, July 7, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-129
- L -
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announce~
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The SeClE tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 10, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing July 10, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
TREASURY DEPARTMENT
t
WASHINGTON, D.C.
? IMMEDIATE RELEASE
TREASURY OFFERS $1-3/4 BILLION IN DECi~l'Tl~9BILLS
The Treasury Der:artment, by this public notice, invites tenders for $1,750,000, "=:0,
: thereabouts, of 1::;7-day Treasury bills, to be issued on a discount basis under
,npeti tive and noncompeti ti ve bidding as hereinafter provided. The bills of this
'des will be dated July F'" 1969, and will mature Dece~ber 22, 1969. They will be
pepted at face value in payment of income taxes due on Dece~oer 15, 1969, and to the
tent they axe not presented for this purpose the face amount of these bills will be
y-a.ble without interest at maturity. Taxpayers desiring to apply these bills in
yment of Jec2L'.ber 15, 19G9, income taxes may submit the bills to a Federal Reserve
nk or Branch or to the Office of the Treasurer of the United States, Washington, not
re than fifteen days before that date. In the case of bills submitted in payment
: income taxes of a corporation they shall be accompanied by a duly completed Form
3 a.nd the office receiving these items will effect the deposit on December 15, 1969.
'the case of bills submitted in payment of income taxes of all other taxpayers, the
fice receiving the bills will issue receipts therefor, the original of which the
lCpayer shall submit on or before Decenber 15, 1969, to the District Director of
ternal Revenue for the District in which such taxes are payable. The bills will be
sued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $50,000,
00,000, $500,000 and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the closing
ur, one-thirty p.m., Eastern daylight saving time, \1 ednesday, July 9, 1969.
nders will not be received at the Treasury Department, Washington. Each tender must
for an even multiple of $1,000, and in the case of competitive tenders the price
fered must be expressed on the basis of 100, with not more than three decimals,
g., 99.925. Fractions may not be used. It is urged that tenders be made on the
inted forms and forwarded in the special envelopes which will be supplied by Federal
serve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of customers proded the names of the customers are set forth in such tenders. Others than banking
sti tutions will not be permitted to submit tenders except for their own account.
tlders will be received without deposit from incorporated banks and trust companies
:1 from responsible and recognized dealers in investment securities. Tenders from
hers must be accompanied by payment of 2 percent of the face amount of Treasury bills
plied for, unless the tenders are accompanied by an express guaranty of payment by an
::orporated bank or trust company.
All bidders are required to agree not to purchase or to sell, or to make any
reements with respect to the purchase or sale or other disposition of any bills. of
ls issue at a specific rate or price, until after one-thirty p.m., Eastern dayllght
ring time, Wednesday, July 9, 1969.
K-130
-2Immediately after the closing hour, tenders will be opened at the Federal Resel'!
Banks and Branches, following which public announcement will be made by the Treasury
Department of the amount and price range of accepted bids. Those submitting tenders
will be advised of the acceptance or rejection thereof. The Secretary of the Treuw
expressly reserves the right to accept or reject any or all tenders, in whole or ~
part, and his action in any such respect shall be final. Subject to these reservatic
noncompeti ti ve tenders for $300,000 or less without stated price from aJJy one bidder
will be accepted in full at the average price (in three decimals) of accepted ccmpetj
ti ve bids. Payment of accepted tenders at the prices offered must be made or complet
at the Federal Reserve Bank in cash or other immediately available funds on July 18
1969. Arry qualified depositary will be penni tted to make settlement by credit in
Treasury tax and loan account for Treasury bills allotted to it for itself and its
customers.
it
The income derived from Treasury bills, whether interest or gain from the sale c
other disposition of the bills, does not have any exemption, as such, and loss fr~
the sale or other disposition of Treasury bills does not have any special trea'bnent,
as such, under the Internal Revenue Code of 1954. The bills are subject to estate,
inheritance, gift or other excise taxes, whether Federal or State, but are ex~t ~
all taxation now or hereafter imposed on the principal or interest thereof by ~
State, or any of the possessions of the United States, or by any local taxing autoon
For purposes of taxation the amount of discount at which Treasury bills are originaU
sold by the United States is considered to be interest. Under Sections 454 (b) ~
1221 (5) of the Internal Revenue Code of 1954 the amount of discount at which bills
issued hereunder are sold is not considered to accrue until such bills are sold,
redeemed or otherwise disposed of, and such bills are excluded from consideration as
capital assets. Accordingly, the owner of Treasury bills (other than life insurance
companies) issued hereunder need include in his income tax return only the differe~.
between the price paid for such bills, whether on original issue or on subsequent I
purchase, and the amount actually received either upon sale or redemption at mat~i~
during the taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this notice, pres~:
the terms of the Treasury bills and govern the conditions of their issue. Copies of
the circular may be obtained from any Federal Reserve Bank or Branch.
4.
K-130
rREASURY DEPARTMENT
-
WASHINGTON. D.C.
Jl.1MEDIATE RELEASE
July 2, 1969
TREASURY OFFERS $1 3/4 BILLION IN MARCH TAX BILLS
The Treasury Department, by this public notice, invites tenders for $1,750,000,000,
:thereabouts , of 24&day Treasury bills, to be issued on a discount basis under
lpetitive and noncompeti ti ve bidding as hereinafter provided. The bills of this
'ies will be dated July 18, 1969, and will mature March 23, 19700
They will be
~epted at face value in payment of income taxes due on March 15, 1970,
and to the
;ent they are not presented for this purpose the face amount of these bills will be
'able without interest at maturity. Taxpayers desiring to apply these bills in
'Illent of March 15, 1970,
income taxes may submit the bills to a Federal Reserve
lk or Bra.nch or to the Office of the Treasurer of the United States, Washington, not
'e than fifteen days before that date. In the case of bill~ ?ubcitted in payY:lent
:income taxes of a corporation they shall be accompanieg..;9y a duly completed Form
i and the office receiving these items 'tlill effect the deposit on March 15, 1970.
the case of bills submitted in payment of income taxes of all other taxpayers, the
'ice receiving the bills will issue receipts therefor, the origiml of which the
:payer shall submit on or before March 15, 1970,
to the District Director of
;ernal Revenue for the District in which such taxes are paya,ble. The bills '\ViII be
,ued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $50,000,
)0,000, $500,000 and $1,000,000 (maturity value).
.
Tenders will be received at Federal Reserve Banks and Branches up to the closing
~, one-thirty p.m., Eastern daylight saving time, Friday, July 11, 1969.
lders will not be received at the Treasury Department, Washington. Each tender must
for an even multiple of $1,000, and in the case of competitive tenders the price
'ered must be expressed on the bas is of 100 , with not more than three decimals,
g., 99.925. Fractions may not be used. It is urged that tenders be made on the
nted forms and forwarded in the special envelopes which will be supplied by Federal
erve B~~s or Branches on application therefor.
Banking institutions generally may submit tenders for account of customers p1.'Oed the names of the customers are set forth in such tenders. Others than banking
titutions will not be penni tted to submit tenders except for their ovm account.
ders will be received 'without deposit from incorporated banks and trust companies
from responsible and recognized dealers in investment securities. Tenders from
ers must be accompg,nied by payment of 2 percent of the face amount of Treasury bills
lied for, unless the tenders are accompanied by an express guaranty of payment by an
Orporated bank or trust company.
All bidders are required to agree not to purchase or to sell, or to make ar~
~ements with respect to the purchase or sale or other disposition of any bills.of
:; issue at a specific rate or price, until after one-thirty p.m., Eastern dayllght
Lng time, Friday, July 11, 1969.
K-131
-2,t-(i
,'t,l, cd',.,"
i-,rr' cl,(),d:n-t:< hou.r, tenders ivill be opened at the Federal ResQ"'.~
<_·clc lJl)'.:)Lic alUw'Jncement '.'lill be made by the Tree.s~~·'·
Those submitting tende:~
will be 0clvisl:,1,)~> s:,c acceptance or rejection thereof. The Secretary of the Trease
C;:D[e:",:-:, 'c.:" ",; l,Lc ri£;ht to accept or reject any or all tenders, in whole or b .
f'ee, (,I,d hi ,,; ,'l:.i;h.!IL in allY such respect shall be final. Subject to these reserva'v:c::.3
Ilc:ll'.':'
1(, '-'
r.,:'nd2:L'3 for $ 300,000 or less without stated price from any one bidd~:
'" illhc:'d'f' U in 1'1.1.11 at the average price (in three decimals) of accepted CC!.1p~t:..
t!.'/:' hi_Cl,.
c;llt of accepted tenders at the prices offered must be made or co!:mle::::;
-: 1~ P l ; .t c>: '
_I,:se:cve B:ink in cash or other immediately availa.ble funds on July is, ,lSC"J"
AT1;I q,
;fied depositary '.':ill be permitted to make settlement by credit in its
'i"l'JSUej L,~X f;,nd loan account for Treasury bills allotted to it for itself and its
c
Dc.',I}:-Jec;lll'
,
.
(·["tk: i:(J1U~::~j price range of accepted bids.
'l'he" llccme deli ved from Treasury bills, ,.,hether interest or gain from the sa.l~ ~:'
c' i 1",_' eli_spes i tion of the bills, does not have any exemption, as such, and loss £'rc::
t fl::: s'd c:: ox other disposition of Treasury bills does not ha.ve a.ny special treat::~r::",
i:L~ sLcL, w-lder the Inte!'ml Revenue Code of 1954.
The bills are subject to estate,
i:lhc'ri L1.p.'f.::, gift or other excise taxes, whether Federal or State, but are exe::?t ::::
8L~ t3,·Z-t ti on um! or h:::reafter irnposed on the principal or interest thereof by a::;
~~t::te, or :111,)" of the possessions of the United States, or by any local taxing a'..;:'chc::::For puqJOc,'_.s of' tEL'<.ation the amount of discolh'1t at which Treasury bills are Orlgl~_:'
sc~d
. til'" United St3,tes is considered to be interest. Under Sections 454 (b) ane
J ??l (5) () [ the Intern2l Re'v-em1e Code of 1954 the amount of discount at which bills
; ::;'oucd i:c:rc"l.cide.c are sold is not considered to accrue until such bills are sold,
!~':dP.J·HJI elr other,rise di3posed of, and such bills are excluded from consideratic:J. &.3
("H:i t .ll
. ~;e;-;s , Accordingly, the o'vmer of Treasury bills (other than life insurgno::e
(·C·'fJ,lr'ir-;-;) l"sl.led hereu!'":5.er need include in his income tax return only the diffe:e:-.:e
h ',', C(,l' cev' III Lee j.1id for such bills, 'whether on original issue or on subseque::;:;
jJ1U'c'r'83e ,l:-:d t(le 2IJGi.1Ilt actu311y received either upon sale or redemption at maturi~:,:
''\:ll'L:1g ttln t."z::lole year for 'which the return is made, as ordiYl...ary gain or loss.
~rn?8'; '1:7 Der,art::-l'2TIJ Circular No. 418 (current revision) and this notice, p:esc:::::
i :1'" TX'l?3.:3U':") bills and govern the conditions of their issue.
Copies c:'
, 'i'-
1,11,_
( ; r'l~l;'l:'
i't;'.,/
b·,:: ob;,8ined from any Federal Reserve Bank or Branch.
TREASURY DEPARTMENT
,
WASHINGTON, D.C.
July 2, 1969
FOR IMMEDIATE RELEASE
SALE OF DECEMBER AND MARCH TAX ANTICIPATION BILLS
The Treasury Department announced today that it will
raise $3.5 billion through the sale of tax anticipation
bills maturing in December 1969 and March 1970.
The bills
will mature on December 22, 1969, and March 23, 1970, but
may be used at face value in payment of Federal income taxes
due December 15, 1969, and March 15, 1970, respectively.
Bills to mature December 22, 1969, in the amount of
$1,750 million will be auctioned Wednesday, July 9.
Bills
to mature March 23, 1970, in the amount of $1,750 million
will be auctioned Friday, July 11.
Delivery of all of
the bills will be Friday, July 18.
Commercial banks will
be able to pay for the bills by crediting Treasury tax
and loan accounts.
K-132
TREASURY DEPARTMENT
WASHINGTON, D.C.
July 3, 1969
FOR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY INVITES HEADS
OF 25 LARGEST BANKS TO MEETING IN WASHINGTON ON INFLATION
The Treasury announced today that Secretary
David M. Kennedy has invited representatives of 25 of the
Nation's largest banks to meet with him in Washington
on Monday, July 7.
In a telegram sent to the banks' chief executive
officers this afternoon, he said:
"I hope you can meet with me and representatives
of 25 of the Nation's largest banks this coming
Monday, July 7, in Washington, to discuss ways in
which the public and private sectors can work
harmoniously together to bring inflation under
control. The meeting, which will be held in Room
4121, Main Treasury Building, at 3:00 p.m., should
provide a timely opportunity to discuss the
Federal Budget, extension of the income tax surcharge,
today's strong demand for credit, and the current high
level of interest rates."
The telegrams went to the following
K-133
banks~
- 2
Chief Executive Officer
Bank of America NT&SA
San Francisco, California
Executive Officer
Chase Manhattan Bank NA
New York, New York
C~ief
Chief Executive Offic~r
First National City Bank
New York, New York
Chief Executive Officer
Manufacturers Hanover Trust Co.
New York, New York
Chief Executive Officer
Morgan Guaranty Trust Co.
New York, New York
Chief Executive Officer
Chemical Bank New York Trust Co.
New York, New York
Chief Executive Officer
Bankers Trust Co.
New York, New York
Chief Executive Officer
Continental Illinois NB&T
Company
Chicago, Illinois
Chief Executive Officer
First National Bank
Chicago, Ill.
Chief Executive Officer
~ecurity Pacific National Bank
Los Angeles, . California
- 3 -
Chief Executive Officer
Wells Fargo Bank NA
San Francisco, California
Chief Executive Officer
Irving Trust Co.
New York, New York
Chief Executive Officer
Crocker-Citizens National Bank
San Francisco, California
Chief Executive Officer
United California Bank
Los Angeles, California
Chief Executive Officer
Mellon National Bank & Trust Co.
Pittsburgh, Pennsylvania
Chief Executive Officer
First National Bank
Boston, Mass.
Chief Executive Officer
Franklin National Bank
Mineola, New York
Chief Executive Officer
Marine Midland Grace Trust Co.
New York, New York
Chief Executive Officer
First Pennsylvania Banking & Tr. Coo
Philadelphia, Pennsylvania
Chief Executive Officer
Cleveland Trust Company
Cleveland, Ohio
Chief Executive Officer
Detroit Bank & Trust Co.
Detroit, Hichigan
,
,.)
\
~.
,
- 4 -
Chief Executive Officer
Philadelphia National Bank
Philadelphia, Pennsylvania
Chief Executive Officer
Seattle-First National Bank
Seattle, Washington.
Chief Executive Officer
National Bank of Detroit
Detroit, Michigan
Chief Executive Officer
Manufacturers National Bank
Detroit, Michigan
TREASURY DEPARTMENT
WASHINGTON, D.C.
July 7, 1969
FOR IMMEDIATE RELEASE
BANKERS MEET WITH SECRETARY KENNEDY, FEDERAL
RESERVE BOARD CHAIRMAN MARTIN AND OTHERS TO DISCUSS
ECONOMI C, MONETARY MATTERS
Secretary of the Treasury David M. Kennedy met with a group
of representatives from the Nation's largest banks today to
discuss inflation, the Federal budget, the income tax surcharge,
and the high level of interest rates.
Federal officials attending the meeting were William McC.
Martin, Chairman of the Federal Reserve Board; J.L. Robertson,
Vice Chairman, Federal Reserve Board; Robert Mayo, Director of
the Bureau of the Budget; Herbert Stein, Member, Council of
Economic Advisers; Under Secretary of the Treasury Charls E. Walker,
Under Secretary of the Treasury for Monetary Affairs Paul A. Volcker,
and William Camp, Comptroller of the Currency.
C-13~
Those attending the meeting included:
Rudolph A. Peterson,
Bank of America, San Francisco; Walter B.Wri6ton,
First
National City Bank, New York; David Rockefeller, The Chase
Manhattan Bank, N.A., New York; William S. Renchard, Chemical
Bank, New York; George A. Murphy, Irving Trust Co., New York;
Eugene S. Northrop, Manufacturers Hanover
Trust, New York;
John Meyer, Morgan Guaranty Trust Co., New York; Tilden Cummings,
Continental Ill. NoB. & Trust Co., Chicago; Gaylord S. Freeman, Jr.,
First National Bank of Chicago, Chicago; Roger C. Damon,
First National Bank, Boston; John R. Bunting, First Penn. Bank,
Philadelphia; G. Morris Darrance, The Philadelphia National
Bank, Philadelphia; John A. Mayer, Mellon Bank & Trust Co.,
Pittsburgh; George F. Karch, Cleveland Trust Co., Cleveland;
Ellis B. Merry, National Bank of Detroit, Detroit;
Roland A. Mewhort, Manufacturers National Bank, Detroit;
Raymond T. Perring, Detroit Bank & Trust Co., Detroit;
William H. Moore, Bankers Trust Co., New York; Carl E. Hartnack,
Security Pacific National Bank, Los Angeles; Richard P. Cooley,
Wells Fargo Bank, NoAo, San Francisco; Emmett G. Solomon,
Crocker-Citizens National Bank, San Francisco; H.V. Grice,
United California Bank, Los Angeles; Harold V. Gleason,
Franklin National Bank, Mineola; RoC. MacDonald, SeattleFirst National Bank, Seattle.
/
\
:\
)
"
,;'
;;
\'VASHH\iGTON, D.C.
1 REIEA3E 6 :30 P.;.I.,
lday, July", 1969.
RESULTS OF 'l'RRA.SURY'S HEEKLY BILL OFFERING
The Treasury Department annou,'1cec1 that the tenders for bro series of Treasury
LIs, one series to be an ac1di tional issue of th2 bills dated AJ2ril lQ., _~ and the
ler series to be dated JlJ,J.:y 10 ,_),~_~~<.J. i>Thich ,,'rere offered on July 2, 1969, ,~ere
med at the Federal Reserve Banks tod2.y. Tenders were invited. for $1,600,000,000,
thereabouts, of 91-day bills and for $1,100,000,000, or thereabouts, of lS2-day
lIs. The details of the b·lO series are as fo1101'Js:
91-day TreasUl~ bills
maturing October ~969
Approx. Equi v •
Annual Rate
Price
::-::----6. 9-59~~
98.241 y
98.202
7.113%
98.213
7.069%
mE OF ACCEPrED
;lPETITlVE BIDS:
High
10'1'1
Average
182-day Treasury bills
maturin~ January 8, 1970
Approx. Equiv.
Annual Rate
Price
96.352
W
96.289
96.305
16(r---/J
7 • 2 .._
,",-\....I,'J
7 • 3 ,;nr:!
7 • 309~~
~ Excepting 2 tenders totaling $2,882,000; ~ Excepting 6 tenders totaling $1,154pa
39% of the amount of 91-day bills bid for at the Imr price vias accepted
55% of the amount of 182-day bills bid for at the 1mV' price ioTaS accepted
rAt TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESBRVE DISTRICTS:
)istrict
3oston
~ei" York
rhilade1phia
$PPlied
For
31,186,000
<
hlcago
it. Louis
1inneapolis
CB.nsas City
)alJ.as
3an Francisco
1,789,818,000
35,251,000
37,622,000
19,924,000
43,072,000
203,233,000
43,791,000
21,061,000
34,906,000
28,959,000
135 2 749 2°°0
TOTALs
$2,424,572,000
~Ieveland
'lichmond
~tlanta
Applied For
Accepted
$-21,186,000
1,104,068,000
20,251,000
37,622,000
17,924,000
35,072,000
173,233,000
38,891,000
8,311,000
34,906,000
19,959,000
88 2 749 2°°0
6,075,000
$
1,686,320,000
20,172,000
42,279,000
15,142,000
27,072 ,000
124,746,000
30,023,000
18,173,000
26,681,000
32,042,000
162 2 486,000
$1,600,172,000 ~ $2,191,711,000
Acceyted.
6,005,000
;$
792,486,000
10,172,000
36,529,000
11,642,000
21,077,000
88,947,000
25,023,000
6,283,000
26,581,000
22,542,000
54 2°76,000
$1,101,363,000 ~
Includes $374,178,000 noncon:petitive tenders accepted at the average price of 98.213
InclUdes $252,737,000 noncompetitive tenders accepted at the average price of 96.3C5
These rates are on a bank diSCOlli~t basis. The equivalent coupon issue yields are
., • -,-.,:"
~(. _. . . :.,
- , . . - ~-..,• ."
- ,. .
<',fl_-_ r"'Il
-- _.c..'
..,
'-'
,'';;
'.J.. ....... __ ~I'
;.'R._
,'~
~
c,,",,~/,
I'
--.'"
-.... ""'\~_ ....
__ '_'
---~
J..
l
-.".,-'
_
- _("'~_f
-....,
~~
- ........
~ ~ 1
.-:4.!
l:";. ___
~-
'-...,
"4
J
•
UNITED STATES SAVINGS BONDS ISSUED AND REDEEMED THROUGH
JUt. ~ ' 1969
(Dollar amounts in millions - rounded and will not necessarily add to totals) ,
DESCRIPTION
AMOUNT ISSUEDY
- - -----------------+-----rURED
prip~
A-1935 thru D-1941 ____ ~ ___ _
f'rtf'S
F' und G-1 941 t hru 195 2 _ _ ~~~ _ _
.!'fips.J and K-1952 lhru 1957 _ _ _~
AMOUNT
REDEEMEDIJ
AMOUNT
OUTSTANDING..?!
-------t---- - - - - - - -
5,003
29,521
3,754
4,996
29,482
3,717
1,883
8,308
13,368
15,595
12,260
5,559
5,274
5,456
5,387
4,708
4,073
4,265
4,874
4,968
5,176
4,999
4,705
4,588
4,297
4,306
4,361
Lf ,197
1942 - - - - - - - - - - - - 1
1943 ~ _ _ _ _ _ _ _ _ _ _ ___I
1,664
7,358
11 ,871
13,760
10,640
4,647
4,255
4,311
4,172
3,595
3,112
3,235
3,607
3,605
3,696
3,523
3,251
3,036
2,770
2,663
2,528
2,361
2,456
2,402
2,315
2,293
2,118
1,594
1944 - - - - - - - - - - - - - - 1
1945 _ _ _ _ _ _ _ _ _ _ _--1
1946 - - - - - - - - - - - - - 1
1947 - - - - - - - - - - - - - 1
1948 _ _ _ _ _ _ _ _ _ _--:
1949 - - - - - - - - - - - - 1
1950 _ _ _ _ _ _ _ _ _ _---j
1951 ____________---1
1952 - - - - - - - ---1953
1954
1955
1956
1957
1958
1959
I!lOO
1961
1CJ62
--------1
------------1
- - - - - _________---1
_ _ _ _ _ _ _ _ _ _---j
_ _ _ _ _ _ _ _ _ _---j
_ _ _ _ _ _ _ _ _ _---j
-------------1
_ _ _ _ _ _ _ _ _ _---j
_ _ _ _ _ _ _ _ _ _---j
_ _ _ _ _ _ _ _ _ _ _--j
_ _ _ _ _ _ _ _ _ __
1963 - - - - - - - - - - - - - - - 1
1964 - - - - - - - - - - - - - 1
1965 _ _ _ _ _ _ _ _ _ _---j
19G6
1967
19fi8
1%9
---------------1
---------------1
--------------1
_ _ _ _ _ _ _ _ _ _---j
1.,679
4,562
4,461
4,801
4,7Sb
4,493
1,029
109
--
016
013
.99
8
39
37
~ATURED
,pries E JJ :
1941 _ _ _ _ _ _ _ _ _ _---j
'.
OUTSTANDING
OF AMOUNT ISSUED
I
219
950
1,496
1,835
1,620
912
1,019
1,145
1,215
1,113
961
1,030
1,267
1,363
1,480
1,475
1,455
1,552
1,527
1,643
1,834
1,836
2,223
2,161
2,1/.. 6
2,508
2,639
2,899
920
JW/es Rc('(u~d discount.
fPllt redt>nJl'(Jnn vBlue.
option of owner bonds may be held and will E'ern interest for addi!JooBI periods Riter ori~HJ81 m8tl1ritr dRr,~S.
Form PO 3812 (Rev. Apr. 1969) - TREASURY DEPARTMENT - Bureau 01 tloe Public Debt
11.63
11.43
11.19
11.77
13.21
16.41
19.32
20.99
22055
23.64
23.59
24.15
26 00
27.44
28.59
29.51
30.92
33.83
35.54
38.16
42 05
43075
47.51
47 37
48.11
52.24
55.49
64.52
89.41
0
0
0
STATEMENT OF THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
BEFORE THE
SENATE FINANCE COMMITTEE
TUESDAY, JULY 8, 1969, 9 AM
Mr. Chairman and members of the Committee, I am grateful
for this opportunity to testify in behalf of H.R. 12290 -- a
bill which contains the anti-inflation measures proposed by
the President.
Specifically, H.R. 12290 would
1. extend the surcharge at 10 percent to December 31,
1969, and at 5 percent thereafter to June 30, 1970,
producing a revenue yield of $7.6 billion in fiscal
year 1970.
2. defer for one year the reduction in the excise taxes
on automobiles and on telephone and teletypewriter
exchange services, producing a revenue increase of
$540 million in fiscal year 1970.
3. repeal the investment credit, producing a revenue
increase of $1.35 billion in fiscal year 1970 and
more than $3 billion in annual revenue in later years.
The House bill incorporates certain transition rules
for repeal of the credit, similar generally to those
used in the 1966 suspension of the credit, reducing
the revenue yield in fiscal year 1970 from the
President's recommendation by about $150 million.
In addition, the President had recommended as a part
of his initial reform proposals the adoption of the Low
Income Allowance to remove the burden of the income tax
K-134
- 2 from persons with incomes below the poverty level and
to reduce the tax burden on persons with incomes just
above this level.
The Low Income Allowance was incorporated by the
House in H.R. 12290 with minor changes, effective
January 1, 1970.
It involves a revenue reduction of
$270 million for fiscal year 1970 and of $625 million
for a full year.
Since it had been recommended by the
President as a reform measure and had been taken into
account in revised budget estimates for fiscal year
1970, its insertion in the bill did not affect the
revenue estimates.
Mr. Chairman, I submit that the economic case for speedy
action on these tax proposals is overwhelming.
During 1969
consumer prices -- the significant shopping basket indicator
have risen at an annual rate of 6.1 percent and wholesale prices
at a rate of 6.3 percent.
It is not necessary to point out to this panel the very
real dangers our country faces if inflation is allowed to continue unchecked.
Inflation of this magnitude could lead to a
serious economic readjustment accompanied by a painfully high
level of unemployment.
- 3 -
Failure to extend the surcharge would amount to a cut in
taxes at a time of accelerating inflation.
The consequences
of failing to pass this legislation are unthinkable.
Even delay poses serious risks.
Delay contributes to a loss of confidence by our people
in the determination of government to bring an orderly halt
to inflation.
Delay feeds inflationary expectations and thus makes
inflation even more difficult to control.
Delay weakens our balance of payments and foreign confidence in the integrity of the dollar and contributes to unsettled conditions in the international monetary markets.
In view of the clear need to continue the fight against
inflation, we must not contemplate delay.
Let me turn to an argument that many raise for opposing
this bill.
These people feel that passage of the tax surcharge
must be linked with tax reform in order to insure enactment
of significant reform.
I understand the sense of frustration of those who hold
this position.
However, we must remember that essentially
there are two separate and distinct problems before us.
the control of inflation, is immediate and urgent.
One,
The other,
- 4 -
tax reform, is vitally important, highly complex, and requires
careful action both by the Congress and the Executive branch.
Linking these two problems may mean that we fail in both
of our objectives.
I agree with those who believe the wait for meaningful
tax reform has been "too long."
But I would point out that
the Ways and Means Committee has met in lengthy public hearings
and executive sessions to consider tax reforms. On May 27, the
Committee announced tentative decisions on tax reform subjects,
and the Chairman of the Committee has announced that reform
would be before the House prior to the August recess.
Moreover, President Nixon fully supports these efforts and
is determined to bring equity to our Federal tax system.
On April 21 the President submitted to the Congress a major
tax reform package, including the low income allowance which
has become a part of the bill before you.
In addition, it
contained these broad proposals:
A limit on tax preferences, which puts a limit of 50 percent on that portion of a person's income which could enjoy a
preferred status, and an allocation of deductions proposal
preventing double benefits from tax preferences.
In addition
to these proposals, the President's initial proposals include
- 5 meaningful reforms dealing with mineral production payments,
private foundations, charitable contribution deductions,
business income of tax-exempt organizations, tax treatment
of corporate securities frequently used by conglomerates,
multiple corporate surtax exemptions, stock dividends, dividents out of accelerated depreciation reserves, restricted
stock plans, farm losses, multiple trusts, moving expenses,
and a number of other important items.
(With the consent of the Committee, I would like to ask
that a summary of the Administration's interim tax reform
proposals of April 22, 1969 be inserted in the record of the
hearings at the conclusion of my statement.)
In that April 21 message, President Nixon said:
"Fairness
calls for tax reform now; beyond that, the American people need
and deserve a simplified Federal tax system, and one that is
attuned to the 1970' s."
He has repeatedly pledged
and in a letter to the House
of Representatives just last week stated again
that he
supports and is determined that there shall be significant,
meaningful, and fair tax reform.
In addition , House and Senate leaders on both sides of
the aisle have pledged to themselves and to their constituents
that there will be tax reform this year.
- 6 -
Gentlemen, there is no need to hold up the extension
of the tax surcharge pending enactment of tax reform.
The
commitment to tax reform has been made to the American people,
and I pledge to you that this Administration will honor that
commitment.
I feel confident that the Congress will respond
in like spirit.
I know that the American people will accept
nothing less.
Before concluding, I would like to mention several areas
where the House-passed bill differs from the President's
recommendations.
Then I would be happy to answer any questions
you may have about those changes or any other aspect of the
legislation.
First, as I noted earlier, the Low Income Allowance
recommended by the President as a part of his interim tax
reform proposals, has been included in this bill.
Action on
this measure should be recognized as a commitment to tax
reform, and we endorse adding it to this bill on the assumption that reform will.be enacted.
Secondly, the transition rules adopted by the House in
connection with the repeal of the investment credit will reduce
the revenue yield from repeal of the credit by about $150 million in fiscal year 1970 as compared with the rules initially
/~
- 7 recommended by the Treasury.
The transition rules in the
bill would allow the credit for certain expenditures after
April 18, 1969, even though there was no binding contract on
that date.
They are, however, generally the same rules adopted
in 1966 on suspension of the investment credit to deal with
cases in which there is an economic commitment evidenced by
expenditures constituting more than half the cost of a facility
prior to the cut-off date.
There are some extensions of the
1966 rules to cases of generally similar nature.
However,
any further extension beyond these rules would be a mistake.
The binding contract rule and these additional rules provide
equitable treatment in the most deserving cases, and they
represent the most reasonable cut-off point.
Finally, the House bill provides that certain capital
facilities acquired to reduce air or water pollution may be
amortized over five years instead of their normal useful lives.
This acceleration of cost recovery will provide an incentive
for installation of anti-pollution facilities.
While we did
not recommend it, it is reasonable if the Committee agrees
that such an incentive is justified.
However, we have serious
reservations about the scope of the House provision, as I will
indicate.
The provision as contained in the House bill will
- 8 result in no substantial short-term revenue loss but will
result in a long-term revenue loss which will reach $300 to
$400 million annually by 1975.
A revenue loss of this magnitude deserves careful scrutiny.
We have concluded on further study of the House provision that
the five-year amortization provision need not be made available to new plants constructed in the future which install
anti-pollution control facilities.
Technological advances
which are occurring in the control of pollution will greatly
reduce the burden on industry in designing new plants to meet
anti-pollution standards.
In these cases, a major tax con-
cession to provide incentive and achieve cost-sharing is not
nearly so important as in the case of existing plants where
the burden is much clearer.
It is also our conclusion on further study of the provision as passed by the House that it provides too great a
benefit to property which has a long useful life.
Thus , ant i-
pollution property qualifying under the bill which has a useful
life of 50 years would receive a tax concession equivalent to
an investment credit of approximately 20 percent.
The rapid
amortization provision is intended to replace the investment
credit for anti-pollution facilities, but an increased benefit
- 9 of this magnitude is not warranted.
The Treasury therefore
proposes that a limitation be placed on the rapid writeoff
so that its benefits would be available only for the first
15 years of the life of any property.
Thus, property with a
50-year useful life could obtain the benefit of the rapid
writeoff for 30 percent of the cost of the facility and use
regular depreciation methods for the remaining cost of the
property.
Such a provision has precedent in the rapid amortiza-
tion permitted for emergency facilities constructed during
World War II.
Finally, the definition of a pollution control facility
needs to be tightened so that the rapid amortization provisions will apply only to treatment facilities which are
clearly identifiable as serving only anti-pollution purposes.
Under the present broad definition, a smokestack or sewer
pipe might qualify for the rapid writeoff, even though these
facilities would be installed in any event and perform functions
other than pollution abatement of the type this tax concession
is designed to give special encouragement.
I urge this Committee to take prompt action on this bill.
The existing 3l-day temporary extension of current withholding
rates will expire on July 31.
As you know, business payrolls
- 10 are a complicated matter.
An enormous burden would be imposed
upon American business -- not to speak of the administrative
nightmare for the Internal Revenue Service -- if they were
required to re-program their payroll systems to withhold at
tax rates without a surcharge and then were required in a
month or so to re-program again to include the surcharge.
xxxx
IY5~
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
July 9, 1969
FOR IMMEDIATE RELEASE
TREASURY AND JUSTICE ASKING LEGISLATION
TO MODERNIZE BUREAU OF CUSTOMS AND CUSTOMS COURT
Treasury Secretary David M. Kennedy and Attorney General
John N. Mitchell announced that legislation to modernize
procedures in the United States Customs Court and in Treasury's
Bureau of Customs is being sent to Congress today. The
legislation, jointly prepared by the two departments, will
help the Court and the Bureau to keep up with sharply
increasing workloads.
New cases coming before the Customs Court have increased
from about 35,000 in fiscal year 1963 to over 108,000 in
fiscal year 1968. However, while the Court has been disposing
of 43,000 cases annually -- an increase of 11,000 yearly -new cases have created a backlog of 439,278 cases as of
March 31 this year. This compares to 186,452 cases in 1963.
The departments said the Court's difficulties result
from outmoded laws, some dating back to 1890, which impose
inefficient, unnecessary and time-consuming practices upon it
and the Bureau of Customs. The legislation calls for
abolishment of such outmoded procedures as:
Using two separate proceedings for
appraisement and classification cases.
Invoking the Court's jurisdiction to
correct errors in appraised values.
Giving importers insufficient time to
file an appeal for reappraisement or
protest.
K-136
- 2 Automatically referring appeals and
protests to the Court without an independent
decision by the importer to invoke the
Court's jurisdiction.
Using three-judges to try protest cases.
Referring judges to prepare written
opinions in all cases.
To deal with the rising volume of customs matters more
effectively, the legislation proposes:
A single, continuous procedure for
deciding all issues in any entry of
merchandise, including appraisement and
classification.
Fuller authority in the Bureau to correct
errors administratively.
Increasing the time to file appeals for
administrative and judicial reviews.
Single-judge decisions and elimination
of written opinions in all cases and
automatic referrals to the Customs Court.
The Departments of the Treasury and Justice held
extensive consultations with the United States Customs Court
and the Court of Customs and Patent Appeals, with
representatives of the Federal Judicial Center, various importer
groups, the Association of the Customs Bar, the Customs
Committee of the Section on Administrative Law of the American
Bar Association, and with many individuals and agencies concerned
with customs procedures.
The departments said former U.S. Supreme Court Justice
Tom C. Clark, Director of the Federal Judicial Center, and
Chief Judge Paul P. Rao of the United States Customs Court
contributed to preparation of the legislative proposal. They alsO
helped by promoting discussions among many interested groups
which led to acceptance of a set of general principles of
procedural reforms. The Justice and Treasury Departments
developed these principles into a working draft which formed
the basis of the legislation.
- 3 -
TECHNICAL ASPECTS OF CUSTOMS COURT AND CUSTOMS
BUREAU PROCEDURES REFORM LEGISLATION
In more specific detail, the major defects in the
present laws governing customs determinations in the
Bureau of Customs and Customs Court include the following:
1.
The Bureau of Customs must automatically
refer appeals for reappraisement and denials
of protests to the Customs Court for disposition
without regard to whether or not the importer
intends to litigate the case.
2.
When a single entry of merchandise presents
both appraisement and classification questions,
neither the Bureau nor the Court can review both
issues in a single proceeding. The appraisement
issue must first be pursued through the Bureau
and then through the Court, and only after this has
been finally determined can the classification
issue be disposed of.
3.
The Bureau lacks authority to correct
administratively any errors of appraisement. The
filing of an appeal for reappraisement by the
Lmporter automatically divests the Bureau of
jurisdiction and pla~es the matter before the Customs
Court; thereafter, any modification of appraised
values can only be remedied in a judicial proceeding
before the Court.
4.
The importer has unrealistically short periods
of thirty and sixty days in which to decide
whecher to litigate the Bureau's decision by
filing an appeal to an appraisement or a protest
to a classification. This causes importers in
many cases to file protective appeals or protests.
5.
The Court lacks statutory authority to charge a
filing fee for commencing an action, and thus, can
place no pecuniary restraint on importers to deter
them from bringing unnecessary and unwarranted
cases into Court.
- 4 6.
Protest cases, which constitute about 60% of
all customs cases, must be decided by a threejudge division of the Court even though these
cases present no greater difficulties than
appraisement cases, which are decided by a
single judge.
7.
Single-judge decisions in appraisement cases
are subject to review by a three-judge division
of the Court.
8.
All decisions in the Court must be in writing
and must contain a statement of the reasons for
the decision and the facts on which it is based.
The key features of the proposed legislation to
modernize procedures in the Bureau of Customs and the Customs
Court include the following:
1.
The Bureau, in liquidating an entry, will decide
at one time all issues relating to the entry,
including appraisement and classification, and will
give the importer mailed notice of the liquidation.
2.
The importer will have 90 days in which to decide
whether he wishes to protest the Bureau's decision
and get further administrative review. The longer
limit will give the importer enough time to
review the case and decide whether any useful
purpose would be served by seeking administrative
review. It should reduce the number of protests
made by the importer as a protective measure.
3.
The Bureau will have 90 days from the date of
liquidation to reliquidate the entry on its own
initiative. This power, to correct administrative
errors or otherwise to conform administrative
actions to decisions reached in cases subsequently
decided by the Court will, in many cases, obviate
the need to an importer to litigate for these
purposes.
4.
If the Bureau denies the protest in whole or in
part, the importer will have 180 days in which to
decide whether or not to have the administrative
decision reviewed by the Court. This should be
- 5 suffic~ent
time for the importer to reach a
fully considered decision on whether to litigate.
It should eliminate many cases that now go on
the Court's docket as protective appeals or
protests because the present 60 day prOVlSlon
is. too short to permit the importer to make an
informed decision.
5.
The importer will be able to obtain speedy
disposition of his protest by filing a written
request with the Bureau at any time after 90 days
have elapsed from the date of filing the protest.
If the Bureau does not allow or deny his protest
in whole or in part within 30 days thereafter, it
will be deemed denied on the thirtieth day
following receipt of the request. The importer
will .then have the right to commence an action in
the Court.
6.
Any protest which has not been allowed or denied
by the Bureau or which has not been deemed
denied after a request has been received for
accelerated disposition will be deemed denied after
two years have elapsed from the date the protest
was filed. The importer will then have a right
to commence an action in Court.
7.
Automatic referral of all appeals for reappraisement
and all denials of protest to the Customs Court
will be eliminated.
8.
If an importer wishes to obtain judicial review
of decisions of the Bureau he will be required
to file a summons in the Customs Court.
9.
Th~re will be a single judicial proceeding in
the Court in which all issues, including both
appraisement and classification, will be taken
up . . The importer will be able to include in one
cause of action all his entries of merchandise which
present common issues. The Court, however, will have
authority to order actions consolidated or severed,
as circumstances warrant.
- 6 -
10.
The Court will have authority to fix a filing
fee for commencing an action but the amount
fixed may not exceed the filing fee for
commencing an action in the United States district
court. Whether a fee is to be charged and the
amount thereof, will lie in the Court's discretion.
The imposition of a fee, however, could induce
potential litigants to consider carefully whether
they wished to bring suit. Minimizing the fee
could also be a factor in persuading litigants to
consolidate numerous importations involving the
same issues into one cause of action. The effect
of a fee, therefore, would be to reduce substantially
the number of cases brought in the Customs Court
each year.
11.
All cases in the Customs Court will normally be
tried by a single judge, thereby increasing
the judicial manpower available for hearing and
deciding cases.
12.
The chief judge will have the authority, on
application or on his own initiative, to designate
three-judge trials when there is a cause of action
that either (1) raises a constitutional question or
(2) has broad or significant implications in the
administration or interpretation of the customs laws.
The use of a three-judge trial will provide a means
for obtaining carefully considered decisions in
landmark or other important cases.
13.
In contested cases, the judge will be able to
support his decision by either a statement of findings
of fact and conclusions of law or by an opinion
stating the reasons and the facts upon which his
decision is based. This option will modify the present
requirement that in every case the judge must write
a decision with a statement of the reasons therefor
and the facts on which the decision is based.
14.
Cases in ports outside of New York will be tried in
the same manner as cases in New York and the trial
judge will have full authority to hear and decide the
case.
/,~
- 7 15.
Appeals from all cases will go directly
to the Court of Customs and Patent Appeals.
This will relieve the Customs Court of its
present burden of having to set up three-judge
divisions to hear appeals from single-judge
decisions in appraisement cases.
000
Ir~
REASURY DEPARTMENT
WASHINGTON. D.C.
July 9, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing
July 17, 1969,
in the amount of
$2,701,700,000,
as follows:
91-day bills (to maturity date) to be issued July 17, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated April 17, 1969,
and to
mature Ocotober 16, 1969, originally issued in the amount of
$1,100,975,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $1,100,000,000,
dated
July 17, 1969,
and to mature
or thereabouts, to be
January 15, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturi ty value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, July 14, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-137
- 2 responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public ann~
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Secretary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 17, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing July 17, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasu
conditions of their issue. Copies of th
from any Federal Reserve Bank 0oO~ranch.
;J
(j
0
rREASURY DEPARTMENT
WASHINGTON. D.C.
RELEASE 6:30 P.M.,
lesday, July 9, 1969.
RESULTS OF TREASURY'S OFFER OF $1-3/4 BILLION OF DECEMBER ~X BILLS
Tbe Treasury Department announced that the tenders for $1,750,000,000, or
eabouts, of 157-day Treasury Tax Anticipation bills to be dated July lS, 1969,
to mature December 22, 1969, which were :::>ffered on July 2, 1969, were opened at
Federal Reserve Banks today.
The details of this issue are as follows:
TOtal applied for - $3,377,S91,000
TOtal accepted
- $1,750,691,000
(includes $145,091,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted c:::>mpeti tive bids!
High
Low
Average
- 97.144
- 96.996
97.045
-
Equivalent rate of discount approx. 6.54~ per annum
"
6.S88~ "
"
"
"
"
"
6. 776~ "
"
"
"
"
"
"
(64% of the amount bid for at the low price was accepted)
LOUis
1eapolis
3as City
Las
Francisco
Total
Applied For
$ 87,315,000
1,700,817,000
197,641,000
128,590,000
81,665,000
109,043,000
356,240,000
82,973,000
173,125,000
61,053,000
68,3 7 0,000
331,059,000
Total
AcceEted
$ 54,315,000
563,517,000
62,641,000
118,590,000
6S,665,000
89,043,000
296,140,000
59,973,000
165,125,000
56,053,000
47,370,000
169,259,000
IDTAL
$3,377,891, 000
$1,750,691,000
!ra1 Reserve
~rict
~on
York
ladelphia
leland
lmond
inta
:ago
This is on a bank discount basis.
8
The equivalent coupon issue yield is 7.08%.
!/
~o(
TRE:.ASURY DEPARTMENT
4
WASHINGTON. D.C.
)R RELEASE 6: 30 P. ~~. ,
~~_ July_ ,~).~9_?~~
"RES JLTS 0:-' TqEASlTRY'S OFER O? $1-3/4 BILLIC;\ OF ?>'lARCH TAX BIlLS
'I'he Treas~r"'J Department announced that toe tenders for $1,750,000,000, or
hereabouts, of 24A-day Treasury Tax Anticipation bills to be dated July 18, 1969,
nd. to mature :irrrch 23: 197C, which were offered on July 2, 1969, were opened at
he Federal Reserve Banks today.
The details of this issue are as follows:
Total applied for - $3,383,935,COC
- ~l, 7 50 ,030, (iOC'
Total accepted
(includes
~1?7.130,OOG
entered on a
basis and accepted in
full at tr:e :.ye:::age price shown below)
~or,com;etitive
~ange
of accepted competitive bids:
Eich
Low
Average
9~.143
(Excepti!1G
~('~-..:i valc:1t
?S.COC
95.830
ratr~
o~
"
I'
"
"
"
'i
C:'1€
tender totaling $200,000)
discount approx. 7.050%
7.258%
"
II
7.201%
II
'j
per annum
"
"
II
"
Y
3l~ of the nnount bid for at the low price was accepted)
Federal Reserve
District
8oston-----Ne,,; York
Philadelphi 11
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Franci see
TOTAL
Y
This is en a bank discount basis.
Applied For
:)) 131,633,000
1,751,538,0(,0
1 7 6,401,000
1Cl7,417,OOO
63,435,000
65,792,COO
358,185,000
106,310,000
55,527,000
51,069,000
54,220,000
462,408,000
Total
Accepted
$ 48,233,000
708,088,000
113,401,000
78,967,000
24,535,000
42,292,000
157,635,000
68,310,000
39,522,OCO
42,869,000
18,770,000
407,408,000
$3,383,935,000
$1,750,030,000
~otal
The equivalent coupon issue yield is 7.61%>.
-REASURY DEPARTMENT
;
;;
WASHINGTON, D.C.
FOR IMMEDIATE RELEASE
July 14, 1969
lIS IS A SIMULTANEOUS RELEASE BY TREASURY AND FEDERAL RESERVE SYSTEM)
LARGE DENOMINATIONS OF CURRENCY
TO BE DISCONTINUED
The Treasury Department and the Federal Reserve System
announced today that the issuance of currency in denominations
of $500, $1,000, $5,000 and $10,000 will be discontinued
immediately. Use of these large denominations has declined
sharply over the last two decades and the need for them
appears insufficient to warrant the added cost of production
and custody of new supplies.
The large denomination notes were first authorized
primarily for interbank transactions by an amendment to the
Federal Reserve Act in 1918. With demand for them shrinking,
printings of new notes of these denominations were discontinued
in 1946, and .the supply that was on hand at that time has now
diminished to the point where continued issuance of such notes
would require additional printings. Surveys have indicated
that transa,-tions for which the large denomination notes have
been used could be met by other means, such as checks or $100
notes.
Under the decision announced today all existing supplies
of large denomination b~l. 1.3 at the Federal Reserve Banks will
be turned over to the Treasury for destruction as will
circulating notes that find their way back to the Federal Banks
in the normal course of business.
The Federal Reserve will c ont::~LU.e to is sue notes in
denominations of $1, $5, $10, $20, $50 and $100. Currency
comprises only about 25 percent of the nationfs money supply,
the vast bulk of which is made up of demand deposits (checking
accounts) •
K-l40
- 2 -
The sharp decline since World War II in the number of
large denomination notes in circulation is shown in the
following end-of-year figures:
$500
. . .0. . . .
0
0
•
•
•
•
•
•
•
•
•
•
•
•
•
$1,000 ..•............••.•....
$5 ,000 ...................•...
$1°,°00.
0
•••••••••••••••••••••
1945
1968
903,404
797,852
1,405
2,327
488,295
291,894
634
383
000
REASURY53 DfPARTMENT
;
WASHINGTON. D.C.
July 11, 1969
~OR
IMMEDIATE RELEASE
TREASURY SECRETARY'KENNEDY PROPOSES
5 PERCENT RATE ON SAVINGS BONDS
secretary of the Treasury David M. Kennedy today disclosed
ietai1s of the Nixon Administration's request to Congress for
legislation to permit the payment of a 5 percent rate of interest
to investors in United States Savings Bonds
He said that in the
same proposal the Administration would seek removal of the
4-1/4 percent interest ceiling on all Treasury bonds.
0
The maximum rate that may be paid on any Treasury bond,
including Savings Bonds, is now 4-1/4 percent, a statutory
limitation which has been unchanged since 1918.
Mr. Kennedy disclosed the intention to ask for this
legislation during his testimony earlier this week before the
Senate Finance Committee.
In submitting the proposal, the Secretary emphasized
his hope that the House Ways and Means Committee consideration of
the legislation would await the completion of work on tax reform.
He said that Committee enactment of a meaningful tax reform
proposal on-the earliest practicable date is a matter of highest
priority.
About $52 billion of Series E and H Savings Bonds are
outstanding. Approximately 11 million people are now buying bonds
through a payroll savings plan. The proposed 5 percent rate would
apply to Savings Bonds purchased after June 1, 1969 and held to
maturity. Holders of outstanding Savings Bonds would also receive
a 5 percent rate for the remaining period to maturity after
June l, 1969.
Treasury is recommending the increase in rate because the current
4-1/4 percent return is not competitive with other investment and
savings opportunities. Redemptions have been running ahead of sales
for seven successive months. In June, redemptions were $483 million
and sales were $383 milliouo The last time savings bond rates were
raised was in June, 1968 when they went to the permitted ceiling of
4-1/4 percent from 4.15 percent.
K-l41
- 2 The 4-1/4 percent interest rate ceiling applies to all
rreasury bonds, including longer term marketable securities with
~aturities of more than 7 years.
In the past, such bonds played
an important role in providing the flexibility for orderly
management of the Federal debt.
Treasury has been unable to sell any marketable bonds since
May of 1965 because longer term interest rates have been above
the 4-1/4 percent ceiling. Instead it has had to rely on short
term instruments -- bills and notes -- on which there is no
interest rate ceiling. As a result, the average maturity of
the privately held marketable debt has dropped about 30 percent
since mid-1965.
Treasury is seeking the removal of the ceiling in order
to permit the orderly restructuring of the public debt in
accordance with national objectives.
Subject to enabling legislation, the proposals effect
Series E and H bonds and the Freedom Share as follows:
E and H Bonds:
The new rate of 5 percent to maturity
will apply to all bonds sold on or
after June 1, 1969. As in the past,
bonds redeemed prior to maturity will
earn a lesser yield but these interim
rates have been improved over the
current schedule. For example, in the
case of E Bonds at 6 months the new rate
will be 3.20 compared to the current
2.24. At 1 year the new rate will be
4.01 compared to the current 3.02 and
at 3 years 4.44 compared to 3.75 percent.
The lower rate of return for short term
holdings reflects the desire of the
Treasury not to compete unduly with
private saving institutions and to retain
an incentive for purchasers to hold their
bonds to maturity.
Beginning with the first semiannual interest period starting on or
after June 1, 1969, rates on outstanding
E and H Bonds will be increased to yield
5 percent when held to maturity or extended
- 3 -
maturity. These outstanding bonds will
also benefit by an improved interim
schedule in the case of earlier
redemptions. Holders are assured there
will be no advantage in redeeming
currently outstanding bonds to
purchase new bonds o
The dollar limit on annual
purchases of E Bonds by an individual
will be reduced to $5,000 purchase
price from the $20,000 face amount
limit currently in force. The
annual limit on H Bonds will be
reduced to $5,000 face amount from
the current $30,000 (on H Bonds the
issue price is the same as the face
amount). Nontaxable exchanges of
Series E Bonds for Series H Bonds
will not be counted against these
new annual purchase limitso
The original maturity of the
Series E Bond will be shortened to
5 years 10 months from the current
7 years. The maturity of the Series H
Bonds will continue to 10 yearso Both
bonds will be extendible at the
discretion of the Secretary of the Treasury.
Freedom Share:
The Freedom Share will continue on
sale for 6 months following Congressional
approval of the proposed legislation.
This continuation period will provide
a reasonable time for subscribers to
convert to the purchase of savings bonds
and will also facilitate payroll and
accounting changes. Legislation is being
requested to provide authority for an
extension of Freedom Shares similar to
those available on savings bonds.
000
FACT SHEET
REMOVAL OF 4-1/4% INTEREST RATE CEILING
I.
The Present Situation
1. Congress placed a 4-1/4% ceiling on U.S. Government
bonds in 1918, and the ceiling has been unchanged
since that date.
2. Throughout most of the intervening fifty years, the
ceiling posed no serious problems for effective
debt management because
1) long-term interest rates generally held
below the ceiling level; and
2) during brief periods of higher rates, the
Treasury could issue shorter-term
securities, such as Treasury bills or
notes, to which the ceiling does not apply.
3. Since 1965, interest rates on longer term
Government securities have continuously been
above 4-1/4%. As a result the Treasury has
been unable to sell any longer-term securities
for the last four years. Instead, it has been
forced to confine its issues to maturities of
seven years or less.*
4. Because the interest ceiling precluded longer-term
issues, the average maturity of the Government's
marketable debt in private hands has dropped from
5-3/4 years in mid-1965 to about 4 years today.
5. In operational
meant that the
$21 billion of
1969, compared
fiscal 1966, a
terms, this shortening of the debt
Treasury had to refinance some
maturing notes and bonds in fiscal
with less than $14 billion in
jump of more than 50%.
Five years or less prior to June 30, 1967.
- 2 II.
Adverse Effects of the 4-1/4% Ceiling
1. Since the 4-1/4% ceiling applies to Savings Bonds
as well as to marketable Government bonds, the
Treasury has been prevented from paying an equitable
and fully competitive rate of return to holders of
Savings Bonds.
2. By forcing the Government to do all its financing
in the short- and medium-term areas, the ceiling
has put upward pressure on shorter term rates,
thus complicating the problems of thrift
institutions in competing for savings.
3. The pile-up of maturing notes and bonds added to
the difficulties of orderly financing the
Government's needs for new funds during periods
of deficit.
4. The shortening of the Government's debt contributes
to the inflationary potential of the economy by
1) complicating the task of the monetary
authorities in pursuing a policy of
credit restraint; and
2) providing investors with liquid assets
that increasingly resembled cash-in-hand.
5. During the past four years, a period of generally
rising interest rates, the ceiling has probably
added to the costs of carrying the public debt
by
1) concentrating Treasury financings in
the shorter end of the market where
rates have generally been higher than
on longer-term securities; and
2) preventing issues of longer-term
securities during temporary periods
of lower interest rates.
- 3 -
III.
Advantages from Removal of Ceiling
1. Removal of the ceiling would mitigate each of
the adverse effects cited above.
2. Specifically, the Treasury would
1) be free to pay a 5% rate of return to
holders of Savings Bonds, as proposed
by the Administration;
2) be able to plan for orderly restructuring
of the Government's debt when conditions
permitted.
3. In general, removal of the ceiling will enable
the Treasury to conduct the nation's financial
housekeeping in a way that supports national
economic objectives rather than conflicting
with them.
IV.
Use of Longer-term Borrowing
1. Removal of the 4-1/4% ceiling would not cause
the Treasury automatically to push large
amounts of debt out to the long-term area.
Rather, it would permit the Treasury to take
advantage of market opportunities gradually to
extend the maturity of the debt through longerterm issues in amounts that would not disrupt
either the Government securities market or
other segments of the capital market.
2. The experience of the first half of the 1960's
is illustrative of what can be accomplished
through flexible debt management. Mainly.
through the use of so-called advance refundings
offering of longer-term securities to holders of
issues in advance of their maturity -- the
Treasury was able to increase the average
maturity of the debt by more than 25% without
adverse effects on the financing of local
governments, house construction, or other
activities.
- 4 3. Given the anticipated demands on capital markets
to finance the high employment economy of the
1970's, there is little likelihood that longerterm interest rates will fall below the 4-1/4%
level in the foreseeable future. There is no
reason, therefore, to delay the removal of a
ceiling that serves no purpose, but only stands
in the way of the orderly planning of debt
management.
000
7-11-69
QUESTIONS AND ANSWERS ABOUT
UNITED STATES SAVINGS BONDS
Q:
What is the Treasury proposing regarding the statutory
interest ceiling on United States Savings Bonds?
A:
Treasury is asking Congress to lift the ceiling and
provide legislation whereby the rate on Savings Bonds
could be set by Treasury at a rate consistent with
marketing conditions, fairness to the investors and
not unduly competitive with thrift institutions.
Q:
What rate does Treasury propose to set currently on
savings bonds?
A:
Treasury proposes that the rate on new bonds be set
at 5 percent, effective from June 1, 1969, and that
the rate paid on existing bonds be adjusted, so that
they will also earn at the rate of 5 percent to
maturity for interest periods beginning after June 1.
Q:
What is the current rate?
A:
Savings bonds now receive the statutory limit of
4-1/4 percent per annum.
Q:
When was this rate set?
A'
The general statutory ceiling for bonds was set in
1918. The current rate on savings bonds was raised
to the legal limit of 4.25% in June 1968 from
4.15%.
Q:
Why raise the rate on savings bonds?
A'
Rates paid by many savings institutions are higher, and
have been higher for several years. Market rates have
also risen substantially. The 4-1/4 percent rate paid
on savings bonds has failed to attract new savers and
new purchasers. As a matter of fact, redemptions of
savings bonds have exceeded sales for the last seven
months. In June, redemptions of $483 million exceeded
sales by $100 million.
- 2 -
JI(
Q:
To what savings bonds would the new rate apply?
A:
All savings bonds, both Series E and Series H, new
issues and outstanding issues.
Q:
What are the characteristics of these bonds?
A:
Series E bonds are sold at 75% of face value. Interest
is paid by the gradual increase in redemption value,
reaching approximately face amount at the end of their
stated original maturity. The currently proposed bond
will reach original maturity in 5 years 10 months.
Older bonds had various original maturity lengths up
to 10 years. They are non-negotiable and may only be
redeemed by the Treasury or an authorized redemption
agency. In practice, most banks and other financial
institutions redeem Series E bonds. Series H bonds are
10 year bonds sold at par on which interest is paid by
semiannual checks issued by the Treasury. They are
also non-negotiable.
Q:
Will there be any change in denominations in which
bonds are sold?
A:
Yes. Series E bonds will be sold in denominations of
$25, "$50, $75, $100, $200, $500, $1~00 maturity value.
They will no longer be sold in denominations of
$10,000 except for employees savings plans. SAries H
bonds will be sold in denominations of $500, $1~00, and
$5,000. They will no longer be sold in denominations of
$10,000. The $10,000 denominations will also be
available for exchanges.
Q:
Is there any limit on the amount of savings bonds one
may buy?
A:
Yes. The annual limit on Series E bonds will be set at
$5,000 issue price -- a reduction from $20,000 face amount;
and the yearly limit on Series H bonds will be set at
$5,000 issue price -- a reduction from $30,000 (issue price
and face amount are the same for Series H bonds).
- 3 -
~/L
Q:
Why the smaller annual limit?
A:
This is largely a technical matter involving other
savings and thrift institutions, such as savings and
loan associations which finance much of the nation's
housing.
Treasury has no desire to cause a shift
from these institutions into savings bonds. Its
primary objective is to promote new savings.
Q:
Will present holders of savings bonds benefit from
the new rates?
A:
Yes. The new rates will apply to all savings bonds
effective the first interest crediting pe~iod beginning
on or after June 1. The rate on bonds currently
outstanding will be adjusted so that they will receive
5 percent to maturity or extended maturity.
Q:
What will happen to Freedom Shares?
A:
Freedom Shares, first offered in 1967, will continue on
sale for six months after the proposed legislation is
passed.
Q:
Is there any reason for present holders of savings bonds to
cash them in for the new issues?
A:
No. Rates of return on all outstanding issues are being
improved so that there is no incentive for such conversions.
Q:
If savings bonds are redeemed prior to maturity does the
holder receive a lower rate of interest?
A:
Yes, but the interim yields have been substantially
. improved. For example holders of both E and H Bonds will
receive 4 percent or more after the first year.
000
7-11-69
2/3
summary of Terms and Conditions of Savings Bonds
(Subject to enabling legislation)
Series E
Series H
!ctive date
All bonds sold on or
after June 1, 1969.
All bonds sold on or
after June 1, 1969.
Le
price
75% of face amount.
100% of face amount.
le
date
First day of month
in which payment is
received by an
authorized issuing
agent.
First day of month
in which payment is
received by a Federal
Reserve Bank or
branch, or by
U.S. Treasury.
5 years 10 months from
issue date.
10 years from
issue date.
:!w bonds
Accrues to approximately
face amount to provide
an investment yield of
approximately 5% if held
to maturity, lesser
yields if redeemed
earlier.
Paid semi-annually
by check. Provides
investment yield of
approximately 5% if
held to maturity,
lesser yields if
redeemed earlier.
utstanding bonds
Increased to provide
5% for remaining time to
maturity or extended
maturity.
Increased to provide
5% for remaining
time to maturity or
extended maturity.
lrity
:!rest:
Series E
Series H
leemability prior
:0 maturity:
~y
Treasury
Not callable
Not callable
~y
Owner
At any time not less
than 2 months from issue
date at any qualified
paying agent.
At any time not less
than 6 months from
issue date at any
Federal Reserve Bank
or branch, or at the
U.S. Treasury except
during the month
preceding an interest
payment date.
~otiabi1ity
None
None
igibility as
liatera1 for loans
None
None
igib1e subscribers
Natural persons and public
and private organizations,
but not commercial banks.
Natural persons and
public and private
organizations, but
not commercial banks.
[lual limit on new
purchases
Annual limit of $5,000,
issue price ($2,000 face
amount per participant
in employee savings plans).
Annual limit of
$5,000, issue price
($200,000 for certain
organizations when
received as gifts).
[lominat ions
$25, $50, $75, $100, $200,
$500, and $1,000 (maturity
value). Also $10,000 and
$100,000 for certain
employee savings plans.
$500, $1,000, and
$5,000 ($10,000 for
use in certain
exchanges) .
arer or
registered
Registered only, natural
persons may have co-owner
or beneficiary
registration.
Registered only,
natural persons may
have co-owner or
beneficiary
registration.
tension privilege
Extendable for 10 years
at rate in effect at time
of extension.
Extendable for 10 years
at rate in effect at
time of extension.
7-11-69
TREASURY DEPARTMENT
WASHINGTON, D.C.
July 14, 1969
FOR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY INVITES 25
ADDITIONAL BANKERS TO WASHINGTON CONFERENCE ON INFLATION
The Treasury announced today that Secretary David M.
Kennedy has invited representatives of 25 leading banks to
meet with him in Washington on Wednesday, July 16, at
10:00 A.M.
The meeting, called to discuss "inflation and related
problems, including the current high level of interest
rates," is' the second such conference. The chief
executives of some 25 of the nation's largest banks
conferred with Treasury and Federal Reserve officials in
Washington July 7.
In a telegram inviting the second group of bankers
to meet with him, Secretary Kennedy said:
"You undoubtedly are aware that I met
this past week with some 25 of the nation's
leading bankers to discuss inflation and
related problems, including the current
high level of interest rates. Since we
believe these informative two-way
conversations are genuinely useful, I hope
you can join us with 25 other leading bankers
at the next meeting, which will be held in
Room 4121, Main Treasury, Washington, D.C.,
10:00 A.M., Wednesday, July 16. The meeting
should adjourn before lunch."
K-142
- 2 -
The telegrams went to the following banks:
Chief Executive Officer
First National Bank of Oregon
Portland, Oregon
Chief Executive Officer
Bank of California NA .
San Francisco, California
Chief Executive Officer
Republic National Bank
Dallas, Texas
Chief Executive Officer
Harris Trust & Savings Bank
Chicago, Illinois
Chief Executive Officer
Bank of New York
New York City, New York
Chief Executive Officer
United States National Bank of Oregon
Portland, Oregon
Chief Executive Officer
Girard Trust Bank
Philadelphia, Pennsylvania
Chief Executive Officer
Pittsburgh National Bank
Pittsburgh, Pennsylvania
Chief Executive Officer
Union Bank
Los Angeles, California
Chief Executive Officer
National Bank of North America
Jamaica, New York
Chief Executive Officer
First National Bank
Dallas, Texas
Chief Executive Officer
Citizens & Southern National Bank of Georgia
Atlanta, Georgia
- 3 -
Chief Executive Officer
Northern Trust Company
Chicago, Illinois
Chief Executive Officer
Wachovia Bank & Trust Company
Winston-Salem, North Carolina
Chief Executive Officer
Marine Midland Trust Company
of Western New York
Buffalo, New York
Chief Executive Officer
National City Bank
Cleveland, Ohio
Chief Executive Officer
Valley National Bank
Phoenix, Arizona
Chief Executive Officer
Bank of the Commonwealth
Detroit, Michigan
Chief Executive Officer
Fidelity Bank
Philadelphia, Pennsylvania
Chief'Executive Officer
Michigan National Bank
Lansing, Michigan
Chief Executive Officer
North Carolina National Bank
Charlotte, North Carolina
Chief Executive Officer
National Bank of Commerce
Seattle, Washington
Chief Executive Officer
Central National Bank
Cleveland, ohio
Chief Executive Officer
First Wisconsin National Bank
Milwaukee, Wisconsin
Chief Executive Officer
Mercantile Trust Company NA
St. Louis, Missouri
REASURY DEPARTMENT
WASHINGTON. D.C.
R RELEASE 6: 30 P.M.,
a~, July 14, 1969.
RESULTS OF TREASURY'S WEEKLY BILL OFn:RING
'!be Treasury Department announced that the tenders tor two series of Treasury
lls, one series to be an additional issue at the bills dated April 17, 1969, and the
tier series to be dated July 17, 1969, which were oftered on July 9, 1969, were
ened at the Federal Reserve Banks today. Tenders were invited tor $1,600,000,000,
thereabouts, of 91-day bills and for $1,100,000,000, or thereabouts, of 182-day
11s. '!be details of the two series are as tallows:
NGE OF ACCEPTED
MPETITIVE BIDS:
High
Low
Average
91-day Treasury bills
_turing October 16, 1969
Approx. Equiv •
Price
Annual Rate
98.223
7.03OJ
98.194
7 .145~
98.204
7.1OS~
g
11
182-day Treasury bills
_turing January 15, 1970
Approx. Equi v .
Price
Annual Rate
1.344
96.287 !V
7.425~
96.246
96.259
7.40~
Excepting 1 tender of $100,000; ~ Excepting 6 tenders totaling $1,479,000
22~ ot the amount of 91-day bills bid for at the low price was accepted
61~ of the amount of 182-day bills bid tor at the low price was accepted
rAt TENDERS APPLn:D FOR AlID ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
Nev York
Philade lphia
:aeveland
Richmond
Ule.nta
:'hicago
St. Louis
~nneapolis
Kansas City
IAillas
San Francisco
'roTALS
Accepted
Applied For
$ 32,859,000 $ 22,859,000
1,887,809,000 1,018,189,000
23,786,000
38,786,000
45,339,000
45,339,000
20,488,000
31,988,000
40,482,000
51,872,000
216,435,000
224,735,000
43,293,000
49,293,000
20,967,000
22,967,000
43,585,000
43,585,000
20,272,000
30,272,000
84,505,000
149,785,000
$2,609,290,000
Applied For
~ 9,180,000
1,815,483,000
24,002,000
50,952,000
24,687,000
44,002,000
178,538,000
32,591,000
20,003,000
32,377,000
31,887,000
217,860,000
$1,600,200,000 ~ $2,481,562,000
Accepted
$ 9,180,000
706, 113, 000
12,002,000
45,835,000
12,187,000
31, OOS, 000
132,238,000
27,806,000
12,503,000
31,877,000
21,887,000
57,860,000
$1,100,493,000 ~/
Includes $440,319,000 noncompetitive tenders accepted at the aver~ price of 98.204
Includes $284,865,000 noncompetitive tenders accepted at the ave~ price of 96.259
ib.ese rates are on a bank discount basis. 'ftle equivalent coupon issue yields are
7.34~tor the 91-day bills, and 7.79'{ofor the 182-day bills.
rREASURY DEPARTMENT
,
WASHINGTON. D.C.
July 16, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing July 24, 1969,
in the amount of
$2,698,432,000,
as follows:
91-day bills (to maturity date) to be issued July 24, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated April 24, 1969,
and to
mature October 23, 1969, originally issued in the amount of
$1,102,578,000,
the additional and original bills to be
freely interchangeable.
l82-day bills, for $1,100,000,000,
dated
July 24, 1969,
and to mature
or thereabouts, to be
January 22, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, July 21, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit· tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
s~bmit tenders except for their own account.
Tenders will be received
Without deposit from incorporated banks and trust companies and from
K-143
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announci
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 24, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing July 24, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 050~ranch.
THE ADMINISTRATOR OF NATIONAL BANKS
WASHINGTON, D. C. 20220
July 16, 1969
MEMORANDUM TO THE PRESS:
In keeping with President Nixon's
request, Comptroller of the Currency William B.
Camp, expressed the hope that the 4,700 National
Banks throughout the country will cooperate in
observance of the "National Day of participation."
United States Treasury
TREASURY DEPARTMENT
WASHINGTON. D.C.
July 16, 1969
FOR IMMEDIATE RELEASE
SECRETARY KENNEDY MEETS WITH GROUP OF BANKERS
TO DISCUSS INFLATION AND RELATED MATTERS
Treasury Secretary David M. Kennedy met today with 22 bankers
to discuss inflation, including the current high level of
interest rates, in the second such conference since July 7.
At the earlier meeting, 24 chief executives of the nation's
largest banks met the Secretary and other Federal officials.
Federal officials attending the meeting with Secretary
Kennedy included Federal Reserve Board Vice Chairman
J. L. Robertson, Under Secretary of the Treasury Charls E.
Walker, Under Secretary of the Treasury for Monetary Affairs
Paul A. Volcker, Budget Bureau Director Robert P. Mayo,
Chairman of the Federal Deposit Insurance Corporation
K. A. Randall, Comptroller of the Currency William B. Camp,
Deputy Assistant Attorney General Robert Hammond, Anti-Trust
Division of the Justice Department; and Hendrick S. Houthakker,
Council of Economic Advisors.
K- 144
drJl
- 2 -
Bankers attending the meeting included:
Lyman E. Seely,
Executive Vice President, First National Bank of Oregon,
Portland, Oregon; James Aston, Chairman, Republic National Bank,
Dallas, Texas; William F. Murray, President, Harris Trust &
Savings Bank, Chicago, Illinois; Elliott Averett, President,
Bank of New York, New York, New York; Stephen S. Gardner, President,
Girard Trust Bank, Philadelphia, Pennsylvania; Robert C. Milsom,
Executive Vice President, Pittsburgh National Bank, Pittsburgh,
Pennsylvania; George A. Thatcher, President, Union Bank, Los Angeles,
California; Sydney Friedman, Chairman of the Board, National
Bank of North America, Jamaica, New York; Robert H. Stewart III,
Chairman of the Board, First National Bank, Dallas, Texas;
Herbert Dickson, Executive Vice President, Citizens & Southern
National Bank of Georgia, Atlanta, Georgia; Robert E. Hunt,
Executive Vice President, Northern Trust Company, Chicago,
Illinois; James H. Styers, Executive Vice President, Wachovia
Bank & Trust Company, Winston-Salem,
Nort~ ~~rolina;
David J. Laub,
President and Chief Executive Officer, Marine Midland Trust
Company of Western New York, Buffalo, New York; Claude M. Blair,
PreSident, National City Bank, Cleveland, Ohio; George W. Miller,
PreSident, Bank of the Commonwealth, Detroit, Michigan;
Howard C. Petersen, Chairman, Fidelity Bank, Philadelphia,
Pennsylvania; Howard J. Stoddard, Chairman of the Board,
- 3 -
Michigan National Bank, Lansing, Michigan; Addison H. Reese,
Chairman of the Board, North Carolina National Bank, Charlotte,
North Carolina; Maxwell Carlson, President, National Bank of
Commerce, Seattle, Washington; Edward L. Carpenter, Chairman
and Chief Executive Officer, Central National Bank, Cleveland,
Ohio; George F. Kasten, Chairman of the Board, First Wisconsin
National Bank, Milwaukee, Wisconsin; John Fox, Chairman of the
Board, Mercantile Trust Company, St. Lpuis, Missouri.
000
REASURY DEPARTMENT
WASHINGTON. D.C.
July 17, 1969
FOR IMMEDIATE RELEASE
TREASURY'S MONTHLY BILL OFFERING
The Treasury Department, by
cor two series of Treasury bills
?1,700,000,000, or thereabouts,
rreasury bills maturing July 31,
?4,409,468,000,
as follows:
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
1969,
in the amount of
273 -day bills (to maturity date) to be issued July 31, 1969,
in the amount of $500,000,000,
or thereabouts, representing an
~dditional amount of bills dated
April 30, 1969,
and to
nature April 30, 1970,
originally issued in the amount of
$1,000,634,000,
the additional and original bills to be
freely interchangeable.
365-day bills, for $ 1,200,000,000,
:lated July 31, 1969,
and to mature
or thereabouts, to be
July 31, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
naturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Thursday, July 24, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even mUltiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec-imals, e. g., 99.925. Fractions may not
be used. (Notwithstanding the fact that the one-year bills will run
for 365 days, the discount rate will be computed on a bank disCount basis of 360 days, as is currently the practice on all issues
of Treasury bills.) It is urged that tenders be made on the printed
forms and forwarded in the special envelopes which will be supplied
by Federal Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
te~d~~~.
Others than banking institutions will not be permitted to
K-145
- 2 submit tender s except for their own account. Tenders will be received
without. depoE',it from i~corporated b!'ink~ and trust companies and from
responsl.ble and recognl.zed dealers l.n l.nvestment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of paJ~ent by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announce.
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The SeCD:! tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 31, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing July 31, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 050~ranch.
TREASURY DEPARTMENT
,
WASHINGTON, D.C.
July 17, 1969
FOR IMMEDIATE RELEASE
SECRETARY KENNEDY SUBMITS LEGISLATION FOR
5 PERCENT RATE ON SAVINGS BONDS
Secretary of the Treasury David M. Kennedy has
submitted to Congress proposed legislation which would
permit Treasury to pay a 5 percent rate of interest on
United States Savings Bonds, and would remove the
present 4-1/4 percent interest ceiling on all Treasury
bonds.
Mr. Kennedy disclosed last week the Nixon
Admirristration's intention to ask Congressional approval
of this legislation.
In letters of July 15 submitting a draft bill
to the President of the Senate, Spiro T. Agnew, and the
Speaker of the House of Representatives, John W. McCormack,
Secretary Kennedy said that "the proposed legislation
has two principal purposes. First, it would enable the
Secretary of the Treasury to pay a fair rate of return to
holders of United States Savings Bonds. Second, it would
provide the Secretary of the Treasury with authority to
plan for orderly restructuring of the public debt in
accordance with national objectives."
Treasury has recommended a higher rate on Savings
Bonds because the current 4-1/4 percent return is not
competitive with other investment and savings opportunities.
The proposed 5 percent rate would apply to Savings Bonds
purchased after June 1, 1969 and held to maturity. Holders
of outstanding Savings Bonds would also receive a 5 percent
rate for the remaining period to maturity after June 1, 19690
K-146
- 2 The 4-1/4 percent interest rate ceiling applies
to all Treasury bonds, including marketable securities
with maturities of more than 7 years. Treasury has been
unable to sell any marketable bonds since May of 1965
because longer term interest rates have been above the
4-1/4 percent ceiling. It therefore has had to rely
on short-term instruments -- bills and notes -- on which
there is no interest rate ceiling. Consequently, the
average maturity of the privately held marketable debt
has dropped about 30 percent since mid-l965.
000
=tEASURY DEPARTMENT
~
;
WASHINGTON, D.C.
July 18, 1969
JR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY APPOINTS
MEADE WHITAKER TAX LEGISLATIVE COUNSEL
Secretary of the Treasury David M. Kennedy today appointed
eade Whitaker, a Birmingham, Alabama, attorney as the Treasury's
ax Legislative Counsel.
Mr. Whitaker comes to the Treasury from the Birmingham law
irm of Cabaniss, Johnston, Gardner & Clark, of which he was a
artner. He replaces Jerome Kurtz, who held the position in the
revious Administration.
As the Treasury's Tax Legislative Counsel, Mr. Whitaker will
irect a staff of lawyers and accountants, dealing with tax policy
atters in the office of Edwin S. Cohen, Assistant Secretary of the
reasury for Tax Policy. The Office of Tax Legislative Counsel
180 reviews and assists in the development of tax regulations,
u1ings and other tax matters.
Mr. Whitaker received his B.A. from Yale University in 1940
nd LLB from the University of Virginia in 1948. While at
irginia, he served on the Board of Editors of the Virginia Law
eview and was elected a member of the Order of the Coif, the
ighest-standing national academic legal fraternity, and the
aven Society, an honor society at the University.
Born in 1919 in Washington, D.C., Mr. Whitaker moved to
ew York City at an early age. He attended the Choate School,
rr Wallingford, Connecticut, and after graduating from there in
936, he went to Yale University.
The appointee joined the U.S. Marine Corps in 1941 and
erved in the First Marine Division in the Pacific during
~rld War II.
He is a retired Lieutenant Colonel in the U.S.
arine Corps Reserve.
-147
- 2 -
J)
7
In addition to being a member of the Birmingham, Alabama,
and American Bar Associations, he has chaired numerous committees
of the Tax Section of the American Bar Association, and served
a three-year term on the Council of the Section of Taxation.
He is also a member of the American Law Institute, the
American Judicature Society and the Tax Institute of America.
Mr. Whitaker has lectured at various tax institutes throughout
the United States and has written nUmerous articles for legal
publications.
Mr. Whitaker is married to the former Frances Dunn Baldwin
of Birmingham. They have two sons and a daughter.
000
~EASURY
DEPARTMENT
WASHINGTON, D.C.
rmEDIA~
RELEASE,
lay, July 22, 1969.
RESULTS OF TREASURY t S WEEKLY BILL OFFERING
Tbe Treasury Department announced that the tenders for two series of Treasury
one series to be an additional issue of the bills dated April 24, 1969, and the
r series to be dated July 24, 1969, which were offered on July 16, 1969, were
~d at the Federal Reserve Banks today.
Tenders were invited for $1,6')0,000,000,
3ereabouts, of 91-day bills and for $1,100,000,000, or thereabouts, of l82-day
5.
TIle details of the two series are as follows!
5,
~
OF ACCEPTED
BIDS:
~TITIVE
High
Low
Average
9l-day Treasury bills
maturing Octobe~ 23 z 1969
Approx. Equiv.
Price
Annual Rate
7.160~
98.190 ~
98.170
7.24~
.};/
7.22,)~
98.175
182-day Treasury bjl1~
maturing January 22, 1970
Approx. Equiv.
Annual Rate
Price
7.422~
96.248
7.469~
96.224
7.459i
96.229
'£7
Y
£I Excepting 3 tenders totaling $143,000
of the amount of 91-day bills bid for at thp. low price was accepted
of the amount of 182-day bills bid for at the low price was accepted
~cepting 6 tenders totaling $930,000;
94~
7l~
~
TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
strict
ston
" York
iladelphia
~veland
~hmond
Lanta
lcago
LOUis
meapolis
lsas City
Llas
Francisco
'roTALS
Applied For
Acce12ted
$ 37,954,000 $ 27,483,000
1,061,294,000
1,863,729,000
24, 789,00()
41,479,000
41,339,000
41,435,000
25,373,000
35,873,000
42,469,000
56,469,000
171,394,000
234,724,000
37,993,000
48,171,000
10,586,000
24,496,000
4-2,336,000
42,336,000
l6,328,000
18,328,000
98,644,000
145,644,000
$2,590,638,000
Applied For
9,199,000
$
1,731,439,000
20,303,000
53,709,000
32,305,000
53,919,000
168,968,000
33,732,000
23,362,000
28,414,000
17,481,000
111,472,000
$1,600,028,0')0 c/ $2,284,303,000
AcceEtec.1
7,777,000
$
773,319,')(10
10,24'),000
43,680,000
13,605,000
37,016,00')
82,759,000
25,032,OOQ
11,570,00,)
26,358,000
17,181,00')
51,462,000
$1,100,299,000 ~/
[neludes $407 041 00(; noncompetitive tenders accepted at the average price of 98.175
[ncludes $273;628;000 noncompetitive te!1cers accepted at the average price ~f 96.22?
lbese rates are on a bank discount basis. The eq;.livalent coupon issue yields are
7.46 ~ for the 91-day billS, and 7.86~ for the l82-day bills.
lEASURY DEPARTMENT
,
:
WASHINGTON. D.C.
July 23, 1969
IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
r two series of Treasury bills to the aggregate amount of
,700,000,000, or thereabouts, for cash and in exchange for
easury bills maturing
July 31, 1969,
in the amount of
~,409 ,468,000,
as follows:
IR
91-day bills (to maturity date) to be issued July 31, 1969,
the amount of $1,600,000,000,
or thereabouts, representing an
ditional amount of bills dated
May 1, 1969,
and to
ture October 30, 1969, originally issued in the amount of
,099,921,000,
the additional and original bills to be
eely interchangeable.
182-day bills, for $1,100,000,000,
ted July 31, 1969,
and to mature
or thereabouts, to be
January 29, 1970.
The bills of both series will be issued on a discount basis under
'mpetitive and noncompetive bidding as hereinafter provided, and at
turity their face amount will be payable without interest. They
11 be issued in bearer form only, and in denominations of $1,000,
,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
laturity value).
Tenders will be received at Federal Reserve Banks and Branches
to the closing hour, one-thirty p.m., Eastern Daylight Saving
me,
Monday, July 28, 1969.
Tenders will not be
ceived at the Treasury Department, Washington. Each tender must
for an even mUltiple of $1,000, and in the case of competitive
nders the price offered must be expressed on the basis of 100,
th not more than three dec"imals, e. g., 99.925. Fractions may not
used. It is urged that tenders be made on the printed forms and
rwarded in the special envelopes which will be supplied by Federal
serve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
stomers provided the names of the customers are set forth in such
nders. Others than banking institutions will not be permitted to
bmit tenders except for their own account. Tenders will be received
thout deposit from incorporated banks and trust companies and from
·148
- 2 respl1l1S ible and recognized dealers in investment securities. Tenders
i'rom others must be accompanied by payment of 2 percent of the face
dtllOunt of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announcl
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rej ection thereof. The Secre tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on July 31, 1969J in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
July 31, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0c50~ranch.
Statement of
Eugene T. Rossides
Assistant Secretary
Department of the Treasury
Before the
Subcommittee to Investigate Juvenile Delinquency
of the
Committee on the Judiciary
of the
United States Senate
on
S. 100
S. 849
S. 977
S. 2433
July 24, 1969
---------------------------Mr. Chairman, I am Eugene T. Rossides, Assistant
Secretary for Enforcement and Operations, Treasury
2
Department.
I am here, in response to your request,
to give you the views of the Department on four legislative proposals affecting Federal controls over firearms
currently administered by the Internal Revenue Service.
Three of the bills under consideration would
introduce new dimensions in Federal controls by imposing
a system identifying ownership of all firearms, or by
limiting gun ownership to persons found to meet established
criteria, or both.
S. 100, introduced by Senator Brooke,
would establish a National registry of all firearms.
Senator Tydings' bill, S. 977, would provide for
Federal registration of all private firearms previously
owned or subsequently purchased unless registered under a
State or local government system meeting Federal standards.
Criteria includes age; freedom from any record as a felon,
mental patient, alcoholic or drug addict; and eligibility
under all applicable laws to possess firearms or ammunition.
Senator Dodd's bill utilizes a "certification'" system
which is a combination of firearms registration and
licensing of gun ownership.
Certificates of eligibility
3
would be Federally issued, except where States have
adopted a comparable, Federally approved, system, and
would be denied to felons, addicts, mental defectives,
juveniles, etc.
Senator Brooke's bill provides penalties for failure
to register.
The other two bills also punish possession
of unregistered firearms, or possession of registered
firearms by uncertified persons.
Under the Dodd and Brooke
bills, the Government would be authorized to buy voluntarily
relinquished firearms and required to buy firearms surrendered
by persons ineligible for licensing or certification.
S. 849, introduced by Senator Mansfield, would replace
an existing provision of law punishing the use, or unlawful
carrying, of a firearm in commission of a Federal felony.
The proposed amendment would make the firearm offense a
distinct crime with sentencing required to be in addition
to and not concurrent with punishment for the basic felony.
Since it involves basic principles of penal sanctions, we
believe the views of the Attorney General concerning its
merits would be of primary significance.
Consequently we
4
prefer not to comment on S. 849 but will defer to
the Department of Justice, accepting their evaluation
of the proposal.
From Treasury's viewpoint, the most significant
of the bills you are considering today are those which
would register guns, and license gun owners.
The registration and licensing bills represent a
distinct departure from previously held concepts of the
Federal role in firearms controls and would launch the
Federal Government into an area traditionally considered
the province of State and local governments.
We know there
are those who believe that the problems of present day
law enforcement demand such action.
However, we wonder if
the National picture has changed that much since adoption
of the Gun Control Act of 1968 last October.
At that time
the Congress considered and rejected bill amendments which
would have required National registration of firearms and
licensing of gun owners.
In adopting the Gun Control Act
in its present form, Congress elected to pursue a course of
assisting State and local governments to regulate firearms
5
within their jurisdictions.
In this regard, I would like to quote extracts
from Senator Dodd's report for the Committee on the
Judiciary, accompanying S. 3633, the Senate Counterpart
of H.R. 17735 which was enacted as Public Law 90-618,
the Gun Control Act of 1968:
"The existing Federal controls over
interstate and foreign commerce in firearms
are not sufficient to enable the States to
effectively cope with the firearms traffic
within their own borders through the exercise
of their police power.
Only through adequate
Federal control over interstate and foreign
commerce in firearms, and over all persons
engaging in the business of importing, manufacturing, or dealing in firearms, can this
problem be dealt with, and effective State and
local regulation of the firearms traffic be made
possible."
*
*
*
6
"The title would have the effect of
channeling interstate and foreign commerce in
firearms through federally licensed importers,
manufacturers, and dealers, thereby prohibiting
the commercial mailorder traffic in firearms
to unlicensed persons.
This will enable the
States to more effectively control firearms traffic
within their own jurisdictions under the police
power granted to them by the Constitution.
"The record reflects the concern of law
enforcement officials throughout the country over
the vast proliferation of mail-order firearms in
interstate commerce.
"This traffic affords circumvention and
contravention of State and local laws governing
the acquisition of firearms.
It is characterized
by ready availability, minimal cost and anonymity
of purchase.
The result has been an ever-increasing
abuse of this source of firearms by juveniles,
minors, and adult criminals.
We believe that the
7
controls on the mail-order traffic as contained
in this title are justified."
*
*
*
Commissioner Thrower will tell you what is being
done to administer the Gun Control Act of 1968.
We
sincerely believe that the above objectives are being
attained.
It is, as yet, however, too early to pass
judgment upon the Act.
Those jurisdictions which now have
such controls over firearms are finding them much more
effective since the Gun Control Act became effective last
December.
Federal regulation of interstate transactions
and of all commercial aspects of traffic in firearms is
assuring the States maximum effectiveness in enforcing
control measures within their borders.
Title I of the Gun Control Act of 1968 is captioned
"State Firearms Control Assistance."
is doing just that,
an~
We believe the Act
submit that it is too early to
consider repudiating the action taken by Congres$ last year.
There are other factors which influence our judgment
on So 100, S. 977, and
S~
2433.
As you know, the Supreme
8
Court in Haynes v. United States,
decided in January
1968 (390 u.S. 85) held a firearms registration provision
of the National Firearms Act to be unenforceable as
compelling self-incrimination contrary to the 5th Amendment of the Constitution.
In Title II of the Gun Control
Act of 1968 Congress endeavored to correct this fault by
granting a form of immunity with respect to registration
information furnished.
The validity of firearms registra-
tion and licensing requirements is not free from doubt
since there has been no judicial test of the registration
requirements under Title II.
Until this provision has been
judicially tested, further legislation of this type would
seem to be premature.
I would also point out that the National registration
of firearms and the Federal licensing of gun owners would
be an extremely costly undertaking.
I realize that the
Tydings and Dodd bills contemplate Federal action only
where acceptable State or local controls are not in effect.
However, only two or three state s would approach qualification
at this time and it is purely speculative as to how many
13~
9
would enact acceptable registration and licensing laws
by the time a Federal statute for this purpose was fully
operative.
The experience of the Internal Revenue Service
in registering some 60,000 National Firearms Act weapons,
during the amnesty period provided in Title II of the Gun
Control Act, clearly demonstrated the expense in manpower
and dollars involved in registration.
Registration of all
firearms would involve an undertaking many times as great.
The licensing of 40,000,000 gun owners would be even
more costly.
In addition to a vast amount of paper work,
licensing, which involves a determination of eligibility,
entails investigative effort.
Such an activity would
require an increase in personnel far exceeding that required
to administer and enforce the Gun Control Act of 1968.
I would also point out that the purchase of unwanted
firearms and of firearms surrendered by ineligible license
applicants could be extremely expensive.
In summation , it is the view of the Department that,
on the basis of 7 months experience, the Gun Control Act
of 1968 is working reasonably well and is providing the
10
needed support for State and local controls for which
it was designed.
We respectfully suggest that the
controls under the Gun Control Act of 1968 be given a
full opportunity to prove their worth.
We do not
believe that, at this time, Federal registration of
firearms and licensing of gun owners is justified.
TREASURY DEPAR'Th1ENT
Introductory statement of Eugene T. Rossides
Assistant Secretary of the Treasury
Before the Subcommittee on Public Buildings and Grounds
of the House Committee on Public Works
On H.R. 11526
Mr. Chairman and Members of the Committee:
As Assistant Secretary of the Treasury, one of my responsibilities
is supervision of the Treasury law enforcement bureaus, including the
secret Service and the White House Police force.
In this connection, I
am appearing before your Committee to urge favorable consideration of
H.R. 11526, which would remove the numerical limit on the White House
Police force and broaden Secret Service statutory authority to
autho~1ze
the Secret Service and the White House Police force under its direction
to perform such additional protective duties as the President may
prescribe •
It is the position of the Department that the President, Wlder his
general powers, may utilize the Secret Service and the other law
enforcement agencies of the Treasury to perform such protective functions
as he deems necessary in order to insure that the duties of his office
are properly and efficiently discharged, and the public interest protected.
The passage of the bill which is presently before this Committee
is considered essential by the Department in order to authorize the
needed personnel resources essential to the continued effective performance of the White House Police.
It will also provide a legislative
- 2 -
basis for the Secret Service, and the White House Police under its
direction, to assume an additional duty of national importance and
significance, the protection of embassies.
In recent years, members of the foreign diplomatic corps stationed
in the District of Columbia have constantly complained to the Department of state concerning disturbances, harassments and the high
incidence of crime involving foreign embassies and their employees.
Recently, these complaints came to the attention of the President and,
at his direction, a plan has been developed that will place in the
Secret Service and the White House Police the responsibility for
protection of foreign embassies in the District of Columbia.
Under international law and practice, it is the obligation of the
host government to take reasonable precautions to insure the safety of
foreign
diplom~tic
officials and the embassies of foreign countries
located in the receiving state.
OUr embassies overseas have been
receiving protection from the central government of the countries in
which they are located.
We must have the capability to carry out our
responsibility to the foreign governments.
At the present time, protection of foreign embassies is a
responsibility of the Petropolitan Police Department along with
the many other requirements placed upon it.
This protection has
been provided as we 11 as could be expected in the light of fast
growing demands on law enforcement in the District.
In addition, the
Federal City itself imposes many extra responsibilities on the Police
- 3Department.
Aside from the public attraction of the foreign diplomatic
community located in this City, visiting dignitaries from other countries,
parades, conventions and the Seat of GoveI'IlIrent itself generate public
action and reaction which create a heavy demand for police attention.
At the same time} the Police Department must carry out its city-wide
responsibility to the general public for law enforcement and protection
in the District of Columbia, including the protection of those who live
and work in the District and the many thousands of visitors and tourists
who corne to Washington each year.
As the Metropolitan Police Department
strength is increased toward its newly authorized level, protection for
special areas can be given greater emphasis.
However, the continuing
attention necessary to assure adequate control of disturbances, harassments and criminal activity that involve the embassies cannot be provided
by local police alone.
OVer the past four years incidents at embassies and crime involving
diplomatic personnel have shown a marked increase causing the diplomatic
corps to ask for increased police protection.
In view of the national government's responsibility to provide
adequate protection for the foreign diplomatic corps and foreign embassies,
the Administration is proposing the assignment of embassy protection to
the Secret Service and to the White House Police under its direction.
This will center protection responsibility in the Federal Government
where it more appropriately belongs.
At the same time, removal of the
4limitation on the number of WhiteHouse Police will provide the necessary
basis for seeking the additional resources necessary to assure an adequate level of protection.
As you know, the Department of state has been concerned with the
problem of protection for foreign diplomatic establishments for some
time.
Recently, former Chief John B. Layton of the District of Columbia
Metropolitan Police Department was appointed as Special Assistant to
Ambassador Emil Mosbacher, Jr., Chief of Protocol, to review and recommend
programs for providing such protection.
We intend to work closely with
the Department of state and with Chief Layton on this project.
Chief
Layton t s long experience, his knowledge of the Metropolitan Police Depart~ent,
and his familiarity with the problems involved in demonstrations
and protection of embassies will be most helpful to us.
While I believe, for reasons I have set out, that it is appropriate
to remove from the
~Ietropolitan
Police Department the burden of the
central responsibility for embassy protection in the City, the continued
assistance of the Metropolitan Police will be essential.
~Thite
Although the
House Police can carry out the day-to-day patrolling of embassy
locations that is essential to raising the level of protection and
assuring adequate security, I want to emphasize that the increased
protection provided by the Federal Government under the Administration's
proposal would be designed primarily as a preventive effort.
It cannot,
and is not intended to, assume the tv'etropoli tan Police Department's
responsibility to conduct criminal investigations involving embassy
personnel and to furnish police officers in adequate numbers to control
demonstrations and other disturbances occurring in close proximity to
- 5foreign diplomatic missions.
continue to
~rfonn
The Metropolitan Police Department would
these responsive functions.
However, it is hoped
that the level of this assistance will be appropriately enhanced as
the strength of the Metropolitan Police is increased.
In order
to recruit the personnel necessary, we are requesting
that the statutory ceiling on the number of' White House Policemen be
removed.
Of course, the appropriation process would continue to pro-
vide direct Congressional control on the number of White House Policemen authorized.
The enactment of this legislation would pennit the
Government to fulfill its responsibility to provide adequate security
for foreign diplomatic missions located in the District of Columbia.
While I have provided the broad outline of the need for the proposed legislation, Director Rowley, who has provided able leadership
of the Secret Service and the White House Police since 1961, will
amplify these and other areas in his remarks.
present to you Director James J. Rowley.
Therefore, may I now
23
r
REASURY DEPARTMENT
,
WASHINGTON, D.C.
RELEASE 6:30 P.M.,
rsciay, July 24, 1969.
RESULTS OF TREASURY'S M)NmLY BILL OFFERING
~ Treasury Department announced that the tenders for two series of Treasury
ls, one series to be an additional issue of the bills dated April 30, 1969, and the
er series to be dated July 31, 1969, which were offered on July 11, 1969, were
ned at the Federal Reserve Banks today. ~nders were invited for $500,000,000, or
reabouts, ot 273-day bills and for $1,200,000,000, or thereabouts, of 365-day bills.
details of the two series are as follows:
GE OF ACCEPTED
PE'l'ITIVE BIm:
High
Low
Average
213-day Treasury bills
AEril 30,2 1910
Approx. Equiv.
Annual Rate
Price
365-day Treasury bills
maturing July 31, 1970
Approx. Equiv.
Price
Annual Rate
maturi~
7.356~
7.422~
94.422
94.372
94.383
7.407~
!I
·
92.649
7. 25 OJ
92.559
92.585
7.33r:J1,
7.313~
52~ of the amount of 273-day bills bid for at the low price was accepted
73~ of the amount of 365-day bills bid for at the low price was accepted
I\L TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
1strict
,os ton
ew York
hi lade 1phia
leve1and
1chmond
tlanta
h1cago
t. Louis
inneapol1s
ansas City
allas
an Francisco
'roTALS
AEElied For
AcceEted
300,000
$
300,006 $
451,558,000
1,291,558,000
309,000
5,309,000
5,868,000
10,668,000
2,690,000
9,690,000
3,384,000
14,009,000
19,816,000
107,416,000
11,587,000
25,881,000
480,000 •
13,480,000
1,291,000
2,097,000
1,305,000
11,305,000
1,559,2 000 .:
111,859,000
·
·
··
·
$1,609,578,000
$
500,147,000
!I
AcceEted
Applied For
892,00:)
10,892,000 $
996,163,000
1,734,863,000
2,451,000
12,451,000
9,136,000
9,136,000
11,169,000
14,169,000
9,945,000
17,945,000
116,181,000
189,181,000
24,654,000
32,654,000
526,000
10,526,000
5,865,000
13,246,000
6,155,000
12,155,000
17,804,000
146,024,000
r
$2,203,242,000
$1,200,941,000
£I
Includes !14,039,000 noncompetitive tenders accepted at the average price of 94.383
Includes 43,284,000 noncompetitive tenders accepted at the average price of 92.585
ihese rates are on a bank discount basis. '!he equivalent coupon issue yields are
7. 85~ for the 213-day bills, and 1. 85~ for the 365-day bills.
-149
REASURY DEPARTMENT
WASHINGTON. D.C.
RELEASE 6: 30 P.M.,
day, July 28, 1969.
RESULTS OF TREASURY'S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
ls, one series to be an additional issue of the bills dated May 1, 1969, and the
.er series to be dated July 31, 1969, which were offered on July 23, 1969, were
ned at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
thereabouts, of 91-day bi.11s and for $1,100,000,000, or thereabouts, of 182-day
Is. The details of the two series are as follows:
rGE OF ACCEPTED
IPETITIVE BIDS:
High
Low
Average
91-day Treasury bills
maturing October 30, 1969
Approx. Equiv.
Price
Annual Rate
98.194 ~l
7.145~
98.182
7.192~
98.187
7.l72~!/;
182-day Treasury bills
maturing January 29, 1970
Approx. Equiv.
Price
Annual Rate
96.319
96.295
96.303
1.281~
7.329~
7.3l3~
j Excepting 1 tender of $900,000
'9~ ;'if
the amount of 91-day bills bid for at the low price was accepted
210 of the amount of 182-day bills bid for at the low price was accepted
~
TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
)istrict
los ton
lew York
lhilade 1phia
:1eveland
lichmond
It1anta
:hicago
it. Louis
linneapolis
~nsas City
>allas
ian FranCisco
'IDTALS
.
Applied For
Acce¥ted
Applied For
Acce12ted
$0,131,000
11,431,000
:$
$
22,187,000
32,792,000
$
729,292,000
1,592,762,000
1,022,178,000
1,898,166,000
22,571,000
32,571,000
41,842,000
57,242,000
37,707,000
39,335,000
39,665,000
40,975,000
11,090,000
13,090,000
17,632,000
19,711,000
31,625,000
43,585,000
30,857,000
49,214,000
92,975,000
139,521,000
201,901,000
228,986,000
27,987,000
40,627,000
40,803,000
58,192,000
18,174,000
22,674,000
19,088,000
23,718,000
26,200,000
26,465,000
43,390,000
45,207,000
16,872,000
27,072,000
14,869,000
24,869,000
75,100,000
157,193,000
105,931,000
163,497,000
$2,642,569,000
$1,600,343,000
£I
$2,146,326,000
$1,100,324,000
9..1
InCludes $391 634 000 noncompetitive tenders accepted at the average price of 98.187
Includes $262;941;000 noncompetitive tenders accepted at the average price of 96.303
These rates are on a bank discount basis. The equivalent coupon issue yields are
1.41~ for the 91-day bills, and 7.7~ for the 182-day bills.
FOR IMMEDIATE RELEASE
July 28, 1969
JOINT STATEMENT OF DAVID M. KENNEDY, SECRETARY OF THE
TREASURY, AND ROBERT P. MAYO, DIRECTOR OF THE BUREAU OF
THE BUDGET, ON BUDGET RESULTS FOR FISCAL YEAR 1969
SUNMARY
The June Monthly Statement of Receipts and Expenditures of the
United States Government released today provides preliminary budget totals
for fiscal year 1969. It shows receipts of $187.8 billion and outlays
of $184.8 billion for the fiscal year 1969, which ended on June 30. The
budget surplus was $3.1 billion.
Receipts were $1.8 billion above the estimate made by the President
on April 15, reflecting higher than expected levels of individual income
tax receipts.
Outlays were $.1 billion below the April 15 estimate.
The budget surplus was $1.9 billion higher than estimated in April,
primarily because of the increase in tax receipts.
FEDERAL FINANCES, FISCAL YEAR 1969
(billions of dollars)
Description
,udget Receipts. Expenditures, and Lending:
Expenditure account:
Receipts ................................ .
Expendi tures ............................ .
Expenditure surplus ••••••••••••••••••
Loan account:
Net lending ........•.....................
April 15
Estimate
Actual
186.1
183.5
2.6
187.8
4.6
+1.8
-0.2
+2.0
1.4
1.5
+0.1
186.1
184.9
1.2
187.8
184.8
3.1
+1.8
-0.1
+1.9
NA
-11.1
NA
NA
NA
-1.2
-1.8
9.8
-3.1
NA
NA
-1.9
1ts3.3
Total budget:
Receipts ....................•............
Outlays ................................. .
Budget surplus ...................... .
eans of Financing:
Borrow~ng
•
f rom the public ••••••••••••••••••
Reduction of cash and monetary
assets, increase (-) ••••••••••••••••••••••
Other means ••••••••••••••••••••••••••••••••
Total budget financing •••••••••••••••••
)te:
Detail will not necessarily add to totals because of rounding.
~ means not available because the data were not compiled on April 15.
-150
Change from
April 15
Estimate
2
RECEIPTS
Budget receipts in the fiscal year 1969 were $1,751 million greater
than the April 15 estimate (which was the same as the January budget
estimate). Revised estimates showing receipts to be about $400 million
above the April figures were issued on May 20, after the tax returns filed
in April had been analyzed.
Income tax receipts provided most of the excess of actual receipts
over the April estimate, but individual and corporate income tax receipts
showed contrasting results. Receipts from individual income taxes were
$2,826 million above the estimate, while corporation receipts were $1,404
million below.
Approximately $600 million of the higher individual income taxes
resulted from bookkeeping adjustments between the income tax account and
employment tax trust funds, and do not affect overall receipts totals.
Another $30U million reflected lower refunds than were anticipated. The
remaining $1,9UO million excess represented payments of final taxes on
calendar year 1968 liabilities and declaration payments on 1969 incomes
substantially above the amounts estimated.
About $400 million of the $1.4 billion decline from the April estimate
of corporation taxes was due to larger-than-expected refunds. The remaining
$1.0 billion reflected shortfalls in final payments of 1968 liabilities and
declaration payments of 1969 liabilities that were below the amounts estimated
earlier.
Employment taxes were almost $600 million less than estimated because
of the reallocation to the individual income tax account, mentioned above.
Excise taxes exceeded estimates by $413 million, reflecting high levels of
economic activity, Estate and gift tax receipts contributed $278 million
and miscellaneous receipts $207 million to the overall receipts excess.
OUTLAYS
Total outlays in fiscal year 1969 were $184.8 billion, $0.1 billion lower
than was estimated April 15, 1969. This change was the net result of a number
of increases and decreases.
The principal increases:
Department of Health, Education, and Welfare outlays were $333 million
above the April 15 estimate, due principally to unanticipated increMes
in the cost of the Medicare program.
Payments of interest on the public debt were $313 million above the
April budget estimate, accounting for most of the $358 million increMe
in Treasury Department outlays.
Net outlays of the Department of Agriculture, excluding the Commodity Credit Corporation, were $295 million higher than estimated,
primarily because tight money conditions prevented the planned sale
of some insured loans of the Farmers Home Administration.
Outlays for the Military functions of the Department of Defense and
Military Assistance exceeded the April estimate by $276 million.
Approximately two-thirds of this increase was in the military assistance program.
Net outlays of the Export-Import Bank were $81 million above the
April estimate, resulting from lower-than-anticipated sales of loans
from the Bank's portfolio.
The principal decreases:
Department of Housing and Urban Development outlays were $480 million
under the April estimate as conversion of urban renewal projects to
annual programs resulted in deferrals of progress payments, as lower
foreclosures of Federal Housing Administration insured mortgages resulted in fewer insurance claim payments, and as fewer than anticipated
project completions resulted in reduced disbursements in such programs
as college housing loans and Government National Mortgage Association
special assistance mortgage purchases.
Department of Agriculture Commodity Credit Corporation net outlays
were $273 million below the April estimate, reflecting in part lower
international food shipments under P.L. 480.
Net outlays of the Department of Transportation were $242 million
under the April 15 estimate, mainly because of reduced spending for
the Supersonic Transport program and the stretchout of several major
equipment acquisitions within the Federal Aviation Agency and the
Coast Guard.
Foreign economic assistance outlays were $130 million below the
April 15 estimate, reflecting a lower rate of spending for Vietnam,
Alliance for Progress loans, and development loans.
IMPACT OF REVENUE AND EXPENDITURE CONTROL ACT
IN FISCAL YEAR 1969
Section 202 of the Revenue and Expenditure Control Act of 1968 (P.L. 90-364)
stablished a ceiling on 1969 outlays which limited outlays to $6 billion below
he amounts recommended in the 1969 budget document (which was sent to the
;ongress in January 1968). However, in setting this limitation, the Congress
~cepted certain programs from the required reductions and subsequently added
)ther exceptions. These exceptions, which are shown in the following table,
~ount to over one-half of total 1969 outlays.
4
The preliminary 1969 year-end results show that total outlays were
$184.8 billion, $1.3 billion below the original January 1968 estimate.
This decrease is the net result of:
an increase of $6.9 billion in programs excepted from the
P.L. 90-364 limitation, and
a decrease of $8.2 billion in programs covered by the P.L. 90-364
limitation
$2.2 billion more than the reduction required by
the law.
BUDGET OUTLAYS IN FISCAL YEAR 1969 - RELATIONSHIP
TO PUBLIC LAW 90-364
(In billions)
Description
Programs excepted from Public Law 90-364
limitation:
Special support of Vietnam operations ••••••
Interes t •••••••••••••••••••••••••••••••••••
Veterans benefits and services •••••••••••••
Social Security Act trust funds ••••••••••••
Old-age and survivors insurance ••••••••••
Disability insurance •••••••••••••••••••••
Health insurance ............•...•.•.•••.•
Unemployment insurance •••••••••••••••••••
Tennessee Valley Authority (portion
financed from power proceeds and
borrowing) •••••••••••••••••••••••••••••••
Commodity Credit Corporation (price
support and related programs) ••••••••••••
Public assistance grants to States
(including Medicaid) •••••••••••••••••••••
Aid to schools in federally impacted areas
(special 1968 supplemental payments made
January
1968
estimate
$
26.3
14.4
7.3
36.0
(24.6)
(2.6)
(5.8)
(3.1)
Actual
$ 29.1
15.9
7.1
36.1
(24.1)
(2.6)
(6.6)
(2.8)
(-*)
(+0.
(-0.
0.1
+*
2.8
3.1
+OJ
5.1
6.2
+0.6
0.1
Subtotal, excepted programs •••••••••••
Remainder covered by Public Law 90-364
92.6
99.5
limi ta tion .•••••••••.•••••••••••••••.••••••
93.5
85.3
TOT~ •••••••••••••••••••••••••••••••••
186.1
184.8
Less than $500 million
Note:
+0.
+0.
(+0.
0.1
in 1969) .•..•..•••••••••.•••••••••••••••
*
$ +2.
+1.
Detail will not necessarily add to totals because of rounding.
-
..0.1
-+6.9
-
-8.2
-1.3
-
BUDGET RECEIPTS AND OUTLAYS
(Fiscal Years - $ In Millions)
1969
Description
1968
January
Actual ~ Budget
April 15
Estimate
Actual
Change from
April 15
Estimate
Receipts by source
ndividua1 income taxes ........... .
orporation income taxes .......... .
ocia1 insurance taxes and
contributions:
Employment taxes & contributions.
Unemployment insurance .......... .
Contributions for other insurance
& retirement .................. .
,xcise taxes ...................... .
state and gift taxes ............. .
ustoms ........................... .
isce 11aneous ..................... .
68,726
28,665
84,400
38,100
84,400
38,100
87,226
36,696
2,826
-1,404
29,224
3,346
34,842
3,300
34,842
3,300
34,245
3,325
-597
25
2,051
14,079
3,051
2,038
2,493
2,366
14,800
3,200
2,300
2,784
2,366
14,800
3,200
2,300
2,784
2,350
15,213
3,478
2,319
2,991
-16
Total receipts ................ 153,671
186,092
186,092
187,843
1,751
401
33
402
33
386
31
-16
-2
231
140
610
1,925
1,914
334
181
140
610
1,925
1,880
334
161
121
783
1,795
1,801
299
-20
-19
173
-130
-79
-35
4,809
2,841
872
5,492
2,917
872
5,219
3,212
854
-273
295
-18
77,790
1,247
46,259
2,017
541
516
3,688
77,790
1,247
46,259
2,017
889
517
3,503
929
77 ,893
1,268
46,592
1,537
834
520
3,475
987
103
21
333
-480
-55
413
278
19
207
Outlays by major agency
346
egis1ative Branch &the Judiciary.
xecutive Office of the President ..
28
unds Appropriated to the President:
Appalachian regional development
III
programs ...................... .
201
Internat'l financial institutions
654
Military assistance ............. .
Economic assistance ............. . 1,844
Office of Economic Opportunity .. . 1,888
Other ........................... .
214
gricu1 ture:
Commodity Credit Corporation .... . 4,509
Other ........................... . 2,799
807
Jmmerce .......................... .
~fense :
Military ........................ . 77 , 373
Civil ........................... . 1,300
la1 th, Education & We 1fare ....... . 40,576
)USing & Urban Development ....... . 4,140
lterior ......................... .
235
Istice ........................... .
430
tbor .............................. 3,271
1St Office ....................... . 1,080
929
3
-28
58
2
1969
1968
January
Actual 1/ Budget
State. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
424
Transportation ..................... 5,732
Treasury:
Interest on the public debt ....... 14,573
Other...................... ..... .
82
Atomic Energy Commission ........... 2,466
General Services Administration. ...
413
Nat'l Aeronautics &Space Admin .... 4,721
Veterans Administration ............ 6,858
Civil Service Commission ........... 2,704
Export-Import Bank.. ....... ........
790
Railroad Retirement Board .......... 1,333
Small Business Administration......
284
U. S. Information Agency. ..........
186
Other Independent Agencies ......... 1,032
Allowances, undistributed ......... .
Undistributed adjustments:
Federal employer contributions to
retirement funds ............... -1,896
Interest credited to certain
Government accounts ............ -2,674
April 15
Estimate
Changefj
Actual
434
6,011
434
6,211
435
5,969
16,000
272
2,451
453
4,247
7,719
1,724
165
1,489
66
191
387
100
16,300
303
2,451
413
4,247
7,719
1,705
165
1,489
100
190
342
16,613
348
2,450
430
4,247
7,670
1,754
246
1,491
-2,105
April IS
Estimate
-
1
-242
313
45
-1
17
-49
49
81
2
III
11
183
244
-7
-98
-2,105
-2,091
14
-3,000
-3,000
-3,099
-99
Total outlays .................. 178,834
183,701
184,901
184,769
-132
Budget surplus (+) or deficit (-) .. -25,162
+2,391
+3 , 074
+1, 883
Note:
1/
Detail will not necessarily add to totals because of rounding.
Amounts for 1968 differ slightly from those shown in the 1970 budget document
released January 15, 1969. The additional time since January has permitted
greater precision in making the accounting changes recommended by the President'
Commission on Budget Concepts.
Preliminary l Statement of
eceipts and Expenditures of the United States Government
for the period from July 1, 1968 through June 30, 1969
(In thousands, hundreds of dollars not printed, therefore details may not add to totals)
TABLE I--SUMMARY (In millions)
Means of Financing
Budget Receipts, Expenditures and Lending
The Expenditure Account
Fiscal Year
Expenditures
Receipts
2
........
$198,686
ated 1969 2 . . . . . . . .
186,092
ated 1970
i
Loan Account
Surplus (+J
or
Deficit(-)
Net
Lending
Budget
Surplus (+)
or
Deficit (-)
By Reduction
of Cash
and Monetary
Assets
Increase (-)
By
Borrowing
from the
Public
Total
Budget
Financing
By
Other
Means
$192,057
+$6,629
-$842
+$5,787
(n.a. )
(n.a. )
(n.a. )
-t5,787
183,525
+2,567
-1,376
+1,191
(n.a. )
(n.a. )
(n.a.)
-1,191
+4,554
-1,480
+3,074
-$11,139 :
-$1,751
$9,816
-3,074
-19,132
-6,030
-25,162
23,100 I
-1,331
3,394
25,162
11969 ........ · ....
lve months)
187,843
183,289
11968 .......... ·· .
153,671 .
172,803
TABLE" -SUMMARY OF BUDGET RECEIPTS, AND OUTLAYS (In thousands)
Current Fiscal Year to Date
The
The
Total
Expenditure
Loan
Budget
Account
Account
Classification
Budget
Estimates 2
RECElPTS
dual income taxes .....................•.••••••••.••.......... , •
lration income taxes .......•........•.•••.•.••.....•.•..•.•...•
I insurance taxes and contributions:
lployment taxes and contributions •....•••.•.•.•••....•...........
!mployment insurance .....•..•••.....•..•.•••••...••...........
Itributions for other insurance and retirement •••••...••...........
etaxes ...................................................... .
e and gift taxes ...•....•..•........•.••.........•.•••••••......
$87,225,565
36,695,990
..............
..............
$87,225,565
36,695,990
$84,400,000
38,100,000
34,842,000
34,244,544
34,244,544
..............
3,300,000
3,324,993
..............
3,324,993
2,366,000
2,349,649
2,349,649
..............
14,800,000
15,213,383
..............
15,213,383
3,200,000
3,477,596
3,477,596
..............
Ims •••••••••.....••.•...••••...••..•••••••••••••••••••...••.•
2,300,000
2,319,467
2,319,467
..............
!llaneous ..................................................... .
2,784,000
2,991,466
2,991,466
..............
r---~~~~~~~~~+---~~~~----~~~~
186,092,000
187,842,654
187,842,654
..............
aI ........................................................... .
0-
F===~~~======~==~==~=========
OUTLAYS
lative Branch ....•....•...........•......•.•••..•.......•.....
udiciary ....•...•...••...•••.....•.......•••••••••..•.•.•.....
ltive Office of the President •••••....•..•.•.•.•...•.•••••••..•...
; appropriated to the President:
Uitary' asSistance .........••..............••.•..•.••••••.•.....
:onomlC assIstance ••.•.••.•.••....•.....•.••.•••..••.••........
her .......................................................... .
ulture Department •.•..•••••.•••..........••••.••••••.•........
1erce Department ....•••.••.............•.•••••••.••••.••.••...
se Department:
~ua~:.:::::::::::::::::::::::::::::::: ::::::::::::::::::::::::
1, Education, and Welfare Department. ......•.•••••••••••.•..•••.
ng and Urban Development Department •••.•.•.•...•.•••••••.••••.
or gepartment .•..•••.•.•••••...••...•....•••••••••.•.•.•....•.
eDe~~~~~~ft ............................................... ..
)f'
................................................. .
flce Department .••.••••..•.•••••••...••.•.•••••.•••.•••.••.••
Department
portation Dep;;t~~~t: : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : :
ury Department:
~;t ~~. ~~~ ~~~~~~ ~~~~.
::::::::::::::::::::::::::::::::::::::::
c Snertr-r Commission ••.••••••••.....•...••••••••.•••••...••.••
aalI Aervlces Administration ••.•••••.•••....•.••••••.••••••.••••••
Ians Administratio
eronautics and Space Admm' 1'st rat'o
In •...••.. , .•••••••••••••••
277,317
108,527
30,756
..............
..............
..............
277,317
108,527
30,756
298,245
103,285
32,824
782,655
1,794,908
2,382,033
7,787,085
821,491
..............
782,655
1,794,908
2,381,151
8,430,872
853,625
610,000
1,925,409
2,536,140
8,409,000
871,875
77,892,659
1,267,528
46,591,720
1,536,766
833,963
519,514
3,474,877
3987,366
435,325
5,969,351
77,790,000
1,246,899
46,259,326
2,017,488
889,000
517,000
3,503,000
929,280
434,344
6,211,000
16,612,938
348,355
2,450,340
429,523
4,246,547
7,669,645
4,031,922
16,300,000
303,000
2,451,472
413,000
4,246,817
7,719,325
3,988,114
77,894,820
1,267,528
46,496,618
718,765
816,635
519,514
3,474,877
987,366
435,325
5,969,451
16,612,938
348,540
2,450,340
422,457
4,246,547
7,415,922
4,415,747
.. ...... '.:$882
643,787
32,134
-2,161
..............
95,103
818,001
17,328
...............
.............
..............
..............
-100
..............
-185
..............
7,067
..............
253,723
n ........................................... .
-383,825
ependent agencies .••••.•••••••••••••..•.•.••••••••••••••••••
.............
.............
..............
............
~n~est' dundistributed .••••••••••••.••.........••••••••••••••••••
n u e Intrabudgetary transactions:
-2,105,165
-2,090,635
deral employer contributions to retirement funds •••.•••••••••••••
-2,090,635
-2,999,678
-3,098,850
..............
-3,098,850
erest credited to certain Government accounts •••••••••.•••••••••• '~--~~~~~~~~~~----~~--~----~~--'d
In
•••••••••
0- • • • •
184,901,000
184,768,666
1,479,989
183,288,677
Total ••.••.•••••.••••••••.•••••••••.••.....•.••••••••••••• 'I~=~;;;;;~~==~;;;;,~F==~~==F===~~=
+1,191,000
+3,073,988
-1,479,989
+4,553,977
IS (+) or deficit (-) and net lending .............................. .
lotnotes on page 3.
t-.)
TABLE III--BUDGET RECEIPTS AND OUTLAYS (In thousands)
SECTION A-- THE EXPENDITURE ACCOUNT
This Month
Classification of
RECEIPTS
Gross
Receipts
Individual income taxes:
Withheld ........................ ···· .. ···· .. • .. • .. •
Other..............................................
Refunds
(Deduct)
I
Current Fiscal Year to Date
Net
Receipts
4
.... .
®6,205,455.,......f;.•.·:..
44 177 899 ::>::.:.~.::::,:...::,.,..:. , .:..
Gross
Receipts
. ....:'.
.
4
6
$70,143,83
427,264,950
Refunds
(Deduct)
' .. ,,'
'.'
t,.
:.,~,<.". ".',..
f.. ·.\.:.::~::-::.-:·::··.·':,:: .
Net
Receipts
".
C.":' •.
.:.....
.
Comparable Period Prior Fiscal Year
Gross
Receipts
$57 300,546
:W' 951 499
'
,
Refunds
(Deduct)
Net
Receipts
:" .... .
' ...•.
.,
.:::::' '.' : ' . ' . , .
c.
.
•..•. ,
•
..:.
Total--Individual income taxes.....................
10,383,354
$283,309
$10,100,045
97,408,786
$10,183,220
$87,225,565
78,252,045
$9,526,532
$68,725,513
Corporation income taxes..............................
8,710,521
104,026
8,606,495
38,356,083
1,660,092
36,695,990
29,896,520
1,231,846
28,664,673
42,128,052
5237,425
453,858............
-29,847............
1,890,627
53,858
-29,847
422,326,452
473,183
41,370,350
............
2,260,066........ ....
21,853,270
1,370,350
2,260,066
19,113,026
1,335,588
2,035,561
218,745
. ....... ....
............
18 894 281
l' 335' 588
2' 03 ' 6
, 5,5 1
473,183
25,483,686
22,484,175
218,745
22,265,430
3,001,577
56,270
4186,730............
337,398
........ ....
2,945,307
186,730
337,398
2,341,909
21,920
128,386............
202,994
... ..... ....
2,319,989
128,386
202,994
3,525,704
56,270
3,469,434
2,673,288
21,920
2,651,368
43,836,363
75,500
4157,471............
53,776............
425,902............
3,760,863
157,471
53,776
425,902
3,111,862
22,050
79,878............
43,613............
279,360............
3,089,812
79,878
43,613
279,360
75,500
4,398,012
3,514,712
22,050
3,492,662
Social insurance taxes and contributions:
Employment taxes and contributions:
Federal old-age and survivors ins. trust fund:
Federal Insurance Contributions Act taxes.... .....
Self-Employment Contribution Act taxes •..•..•..••
DepOSits by States...............................
Total--FOASI trust fund.......................
Federal disability insurance trust fund:
Federal Insurance Contributions Act taxes •.•.•.•.•
Self-Employment Contributions Act taxes..........
Deposits by States...............................
Total--FDI trust fund.........................
Federal hospital insurance trust fund:
Federal Insurance Contributions Act taxes.........
Self-Employment Contributions Act taxes..........
Receipts from Railroad retirement account........
DepOSits by States...............................
2,152,064
237,425
1,914,639
4273,086
532,975
44,495............
17,140.... ... .....
240,111
4,495
17,140
294,721
32,975
261,746
4351,584
542,000
45,201....... .....
•.............
............
21,589............
309,584
5,201
............
21,589
25,956,868
4
Total--FID trust fund..........................
378,374
42,000
336,374
4,473,512
Railroad retirement accounts:
Railroad Retirement Tax Act taxes................
82,592
3
82,589
893,560
148
893,412
814,835
508
814,327
Total--Employment taxes and contributions......
2,907,751
312,403
2,595,348
34,849,645
605,101
34,244,544
29,487,010
263,223
29,223,788
29,382............
2,794
790
25,676............
29,382
2,004
25,676
2,556,374............
641 070
6,852
134;400............
2,556,374
634 218
134;400
2,605,057
606 802
139;595
............
5 829
........ :...
2,605,057
600 972
139;595
57,852
3,331,845
6,852
3,324,993
3,351,454
5,829
3,345,624
Unemployment insurance:
Unemployment trust fund:
State taxes deposited in Treasury.................
Federal Unemployment Tax Act taxes..............
Railroad Unemployment Ins. Act contributions.....
790
57,062
Contributions for other insurance and retirement:
Federal supplementary medical ins. trust fund:
Premiums deducted from benefit payments.........
Premiums collected by Social Security Admin......
Premiums deposited by states....................
Total--Unemployment trust fund........ •.••..•.
62,429............
8,967............
3,206 ............
62,429
8,987
3,206
750,755............
75,664............
75,833............
750,755
75,664
75,833
583,919............
61,520............
53,026............
583,919
61,520
53,026
fund........................
74,602............
74,602
902,251............
902,251
698,465............
698,465
96,164
514
53
96,164
514
53
Total--FSMI trust
Federal employees retirement contributions:
CivU service retirement and disability fund.........
Foreign service reUreuumt and disability
=her ••••••••••••••••••••••••••••••••••••••••••
fund......
Tot.al- -Fede .. ""
.~&'loy._
con.t.rl.t:.u:
OIDIa
..eUreEnent.
...............................
..........••
............
•. . •. . . . . . ••
1,416,877
5,652
579
•.......•..•
............
•. .•. . ... •.•
1,416,877
5,652
579
1,327,138
4,582
:I...,
..............
1,4:18,107
1,.aa2,:100
___ .
...,....
..............
1,327 138
••..•...•...
...... ......
4'582
' fI1fI
~. . . • . • • • • • • •
.~:-_~_~.~.:..._. . . _:_':.-
1
2,".,,,,
ClassifIcation of
RECEIPTS--Continued
Social insurance taxes and contributions- -Continued
Contributions for other insurance and retirement- -Continued
Other retirement contributions:
Civil service retirement and disability fund.........
Gross
Receipts
This Month
Refunds
(Deduct)
Net
Receipts
$24,291
•••••••••••••
•••••••••••
Total--Contributions for other insurance and
retirement...................... ......... . ...
172,472
...... •.•••
172,472
Total--Social insurance taxes and contributions....
3,138,074
$313,193
2,824,882
40,531,139
$611,953
Excise taxes:
Internal Revenue Code: Subtitle D:
Miscellaneous excise taxes..........................
Highway Revenue Act of 1956, as amended:
Highway trust fund..................................
986,821
-24,570
1,011,391
10,672,300
96,093
10,576,207
388,600
14,000
374,600
4,860,931
223,755
4,637,176
4,493,273
114,387
4,378,886
Total--Excise taxes................ ...... ...... ..
1,375,421
-10,570
1,385,991
15,533,231
319,848
15,213,383
14,320,396
241,352
14,079,045
Estate and gift taxes.....................................
30B,117
2,520
305,597
3,516,807
39,211
3,477,596
3,081,979
31,283
3,050,696
Customs duties.........................................
215,428
5,223
210,205
2,387,677
68,209
2,319,467
2,113,475
75,237
2,038,238
Miscellaneous receipts:
Deposits of earnings by Federal Reserve Banks .........
All other ............................................
248,524
173,943
...........
331
248,524
173,613
2,661,524
330,325
.............
383
2,661,524
329,942
2,090,948
402,428
............
63
2,090,948
402,365
2,349,649.. •••••• ••.•.
$24,291
Comparable Period Prior Fiscal Year
Gross
Refunds
Net
Receipts
(Deduct)
Receipts
$1,138
6
tl,138
Current Fiscal Year to Date
Gross
Refunds
Net
Receipts
(Deduct)
Receipts
$19,867
.••.••••••••
t19,867
2,349,649
2,050,532
............
2,050,532
39,919,186
34,888,996
$269,052
34,619,944
9,827,123
126,964
9,700,159
Total--Miscellaneous receipts. ... ... .. .... .. .. . .....
422,467
331
422,136
2,991,849
383
2,991,466
2,493,376
63
2,493,313
Total--Budget receipts..............................
24,553,382
698,032
23,855,350
200,725,571
12,882,917
187,642,654
165,046,787
11,375,365
153,671,422
FOOTNOTES
'This statement is preliminary and is based on reports from disbursing, collecting and administrative agencies of the Government.
Final reports of Government disbursing, collecting and administrative
agencies, including certain overseas transactions for the year ended
June 30, 1969, which it has not been possible to include in this statement
will be incorporated in the final statement for fiscal year 1969 to be
pUblished at a later date.
2 Based on "Review of the 1970 Budget" released April 15, 1969.
3 Transactions cover the period July 1, 1968, through June 30, 1969
and are partially estimated.
4 In accordance with the provisions of the Social Security Act, as
amended, "Individual income Taxes withheld" have been increased and
"Federal Insurance Contributions Act" taxes have been decreased in
the amount of $70,277,208 to correct estimates for quarter ended
September 30, 1968 and prior. "Individual income taxes other" have
been increased and "Self-Employment Contributions Act" taxes have
been decreased in the amount of $40,445,688 to correct estimates for
the calendar year 1967 and prior.
• Represents an acceleration of the timing in charging these trust
funds for refunds and does not affect the total budget surplus.
• Represents adjustment of prior month's distribution of refunds.
7 Includes $697 million auction of certificates of interest.
8 Includes recovery of $120 million of reserve.
* Less than $500.00.
** Less than $500,000.00.
n.a. Not available.
Co)
~
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
EXPENDITURES
This Month
I
I
Expenditures
(Disbursements)
Applicable
Receipts
I Expenditures
Net
Current Fiscal Year to Date
I Comparable Period Prior Fiscal Year
I
Net
Net
) Expendltures)1 APPlicable]
II(DisDursements)
EXpenditUres)) APPlicable)
Receipts
Expenditures
Receipts
Expenditures (Disbursements)
1---- ----
Legislative Branch:
Senate .......... , ..................... , ..........
House of Representatives •.........................
Joint items for Senate and House .......... , ........
Architect of the Capitol ...........................
Botanic Garden ...................................
Library of Congress ..............................
Government Printing Office:
General fund aPfrrorriatiOnS •....................
Revolving fund net .............................
General Accounting Office .........................
Proprietary receipts from the public ... , ...........
Intrabudgetary transactions .........•.............
Total- - Legislative Branch .....................
$48,005
90,562
11,748
18,395
610
42,675
$42,441
81,833
10,871
20,654
554
35,484
30,381
-11,917
58,997
-11,585
-554
31,266
-7,482
53,112
-554
. ..........
...........
...........
...........
...........
...........
...........
. ..........
. ..........
$11,585
...........
19,123
288,902
11,585
248
53
145
130
2,867
507
1,719
1,643
...........
...........
...........
...........
103,036
162
649
. ............
. ..........
. ..........
. ..........
28
8,840
48
63
-28
2,055
103,036
162
649
-2,055
2,055
108,527
93,991
195
3,077
1,305
904
9,674
1,020
470
150
2,821
801
605
9,024
854
503
1,549
668
9,754
1,492
55
505
88
1,114
639
9,601
1,212
931
527
-363
30,756
28,420
954
160,322
19,002
118
168,206
575
111,016
31,761
122
82,327
10.000
7,893
314
1,509
43
4,491
.............
.............
.............
.............
.............
.............
$4,389
7,893
314
1,509
43
4,491
$48,005
90,562
11,748
18,395
610
42,675
3,035
-6,016
4,668
3,035
-6,016
4,668
-1,126
-76
30,381
-11,917
58,997
-76
.............
.............
.............
$1,126
.............
20,249
1,126
248
53
145
130
.............
.............
.............
.............
.............
.............
.............
~4,389
..............
.............
The Judiciary:
Supreme Court of the United States ...............•.
Court of Customs and Patent Appeals •..............
Customs Court ...................................
Court of Claims ..................................
Courts of appeals, district courts, and other judicial
services .... " ..........•......•.......•.......
Federal Judicial' Center •..•.......................
Judicial survivors annuity fund •....................
Proprietary receipts from the public ..•..•..•..•...
..............
Total--The Judiciary ..... " ...................
9,526
28
9,498
110,582
45
289
168
63
708
2
38
.............
.............
.............
.............
.............
.............
.............
.............
.............
.............
.............
.............
.............
45
289
168
63
708
2
38
195
3,077
1,305
904
9,674
1,020
470
47
58
804
Executive Office of the President:
Compensation of the President .....................
The White House Office ...........................
Special projects ..................................
Executive mansion ...............................
Bureau of the Budget ..............................
Council of Economic Advisers .....................
National Aeronautics and Space Council •............
National Council and Commission on Marine Science
Engineering, and Resources ................... :.
National Security Council•.........................
Office of Emergency Preparedness •••.•.........•.
Office 01 Science and Technology ...................
President's CommiSSion on Postal Organization .....
Special representative for trade negotiations ........
Misce llaneous ....................................
Total--Executive Office of the President •.......
Funds appropriated to the President:
Appalachian regional development programs:
Public enterprise funds .................•.. " ...
Other •••••• '" •••••••••...•..•..•.....•.......
Disaster relief •.........•.......................
~mergency fund for the President .•................
xpanslon of defense productlon . . .................
~~~=~::,~l~~~~T~!~f~~::~ent •.•...•....•••
A_tan Development Bank . . . . . . . . . . . . . . . . . . . .
lDveat:rnent In Inter-AlDerlcan D.v.lo~Ulent aa.i..ic.' ••
o:e:~;ll:~l~~=~l neve OpUlent A.;'~:
8,840
48
63
47
58
804
206
1
35
367
2,829
43
16,333
4,028
114
24,755
113
•.••.. "ii;-i50
18.000
.............
1
35
367
1,549
668
9,754
1,492
55
505
88
.............
2,829
30,756
43
16,333
4,028
114
16,698
113
963
160,322
19,002
118
222,762
575
. ............
10,000
.............
.............
.............
.............
8,057
..............
..............
.............
.............
206
11.460
12.,000
74.300
• • 300
...........
...........
. ..........
. ..........
. ..........
. ..........
. ..........
...........
. ..........
...........
...........
...........
...........
...........
...........
10
...........
............
..........
54,556
............
...........
...........
............
............
$42,441
81.833
10,871
20,654
554
35,464
. ............
. ............
. ...........
. ...........
. ...........
. ...........
............
............
............
............
$13,250
............
. .............
277,317
268,711
13,250
255,461
2,867
2,645
427
1,365
1,453
............
. ...........
............
............
2,645
427
1,365
1,453
507
1,719
1,643
74.300
..300
. ...........
31,266
-7,482
53,112
-13,250
87,588
87,588
. ...........
.............
512 ............
.............
3,431
..............
3,431
90,559
............
. ...........
. ...........
. ...........
............
............
150
2,821
801
605
9,024
854
503
............
............
............
............
............
1,114
639
9,601
1,212
931
527
-363
............
............
512
-3,431
............
............
28,420
223
•.......•...
••......•...
•.....••..••
29,737
~I············
••••••••••••
32
111,016
31,761
122
52,1180
10.000
............
10,GIID
===: : : : =: : : =
1_.1GD
1::=
UI
81,..,
Classification of
EXPENDrrURES - -Continued
This Month
Expenditures
(Disbursements)
I Applicable
Receipts
I
Current Fiscal Year to Date
Net
Expenditures
Expenditures (Disbursements)
Applicable
Receipts
Comparable Period Prior Fiscal Year
I
Net
Expenditures
Expenditures (Disbursements
Funds appropriated to the Presldent--Continued
~~alce Corpsct' ••
P ~1~pPlne
uca fn p[.ogram ••••••••••••• •••••••• •••
SU ~clwf~~eiacceeralOn •• ~.~~......................
pecla
~ curre.ncy activIties.. ••• •• • •• • ••••• ••• •
Southeast hurricane disaster..... ................ .....
Military assistance:
Defense Department ...............................
Allotheragencies.................................
Foreign military credit sales. •..•...••..••.......•
Foreignmilitarysalesfund... .....................
Military assistance advances ••••••• ................
Proprietary receipts from the public:
Military assistance advances.....................
Other .........................................•
••••••••. •••.•
• •• • •• • • • • •• • •
133,873
243
-133,873
-243
...............
• •. •• • • • •. •• • • •
94i,509
243
-941,509
-243
Total- -Military assistance ........•............
327,731
198,117
129,613
2,002,095
1,219,440
782,655
:a H········· ... ·......................
$8,681
..............
119
10
41
Applicable
Receipts
Net
Expenditures
$4
............
............
.•• • • . . . . •. •
............
$8,677
............
119
10
41
$103,676
$124
6,531............
2,048 ............
16
••••••••••••
528
............
$103,552
6,531
2,048
16
528
$111,195
15,364
4,957
201
634
$166
.............
.............
..... • •. . . .•.
.............
$111;029
1~,~~
'20
102,840
...•.••..•..
-1,934
............
17,500 ............
72,712
64,001
136,612... .... .....
102,840
-1,934
17,500
8,711
136,612
613,161
............
-3,114
............
17,500 ............
315,221
277,688
1,059,328... .........
613,161
-3,114
17,500
37,533
1,059,328
618,704
-32
.............
............ .
618,~
1,014,571
.............
1,014,571
63
l
I .............
.
173,914 . ..... i9i;659 [......... :i7;746
961,071
I
-961,071
1.807,156
1,152,730
654,426
198,332
81,833
61,300
471,346
181,461
28,311
'15 , 674
219,195
93,105
45,489
432,570
130,541
43,310
74 , 925
•••••••••••••
.............
.............
.............
.............
•• •••• .......
.............
219,195
93,105
45,489
432,570
130,541
43,310
74,925
299-,388
540,374
-9;382
-133,728
388,412
670,355
1,674
..............
76,102
71,903
15,973
91,718
312,310
598,452
-14,299
-91,718
1
Economic assistance:
Technical cooperation and development grants:
General ••••••••••••••••••••••••••••••••••••••••
Alliance for Progress ............ ...............
Social progress fund, Inter-American Dev. Bank .....
Supporting assistance ..............................
International organizations and programs ••••••••••••
Contingencies.....................................
Other
Public ••••••••••••••••••••••••••••••••••••••••••••
enterprise funds:
Alliance for progress development loans ....... '"
Development loan funds...........................
Foreign Investment guarantee fund.. ..... ..........
Proprietary receipts from the public ................
16838
5;209
7,530
31,589
35,897
5,780
8 ' 237
43,551
52,084
3,314
..............
••••••••••••
............
............
............
............
... .........
........ _....
8,673
4,672
3,738
-6,058
16,838
5,209
7,530
31,589
35,897
5,780
8, 237
34,878
47,412
-425
6,058
198,332
••••••••••••
81,833
............
61,300
............
471,346 ............
181,461 ............
28,311............
75 , 674
............
381,491
82,103
613,878
73',504
12,605
21,987
...............
133,728
Total--Economic assistance......................
210,028
11,026
199,002
2,106,230
311,322
1,794,908
2,099,576
255,696
1,843,880
Proprietat'y receipts from the public ................
..............
19
-19
...............
371
-371
..............
585
-585
Total--Funds appropriated to the PreSident ........
855,624
217,391
638,232
6,548,203
1,588,607
4,959,596
6,338,953
1,440,947
4,898,005
22,402
4,647
7,539
122
............
............
............
............
22,402
4,647
7,539
122
251,984
............
59,812
...... ......
97,215........ .••.
1,412
.. ..........
251,984
59,812
97,215
1,412
238,270
58,971
90,052
1,386
.............
........ .....
.............
.............
238,270
58,971
90,052
1,386
9,737
9,669
1,681
1,121
1,690
............
............
............
............
............
9,737
9,669
1,681
1,121
1,690
125,738
100,588
15,952
13,103
14,919
............
............
............
............
............
125,738
100,588
15,952
13,103
14,919
120,517
99,625
15,835
13,269
14,712
.............
.............
.............
.............
.............
120,517
99,625
15,835
13,269
14,712
8,868
104
10,236
17,276
23,176
33,322
2,655
............
............
............
............
............
... ...... •••
............
8,868
10,236
17,276
23,176
33,322
2,655
112,890 ............
1,599 ............
101,909 ............
237,191
............
247,564
............
414,635............
30,468
............
112,890
1,599
101,909
237,191
247,564
414,635
30,46E
93,022 .............
1,750 .............
103,730 .............
216,860 .............
184,727 .............
174,732 .............
31,400 .............
93,022
1,750
103,730
216,860
184,727
174,732
31,400
95,638
............
95,638
806,220
806,220
Agriculture Department:
Agricultural Research Service........................
Cooperative state Research Service....... .... .........
Extension Service...... ................... ...........
Farmer Cooperative Service..........................
Soil Conservation Service:
Conservation operations............................
Flood prevention, watershed protection and other ••••.
Great Plains conservation program............... •••
Economic Research Service ........ ....... •••••• •••••
Statistical Reporting Service .........................
Consumer and Marketing ServIce:
Consumer protectlve, marketlng and regulatory
programs.. •••••••••••••••••••••••••••••••• •••••
Payments to States and possessIons .................
SpecIal milk program..............................
School lunch program ••• •••••• .....................
Food stamp program ..................... ,........
Removal of surplus agricultural commodIties.........
Other............................... .............
Total--Consumer and Marketing Service...........
104
1,146,257
............
1,146,25"
.............
VI
0-
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT --Continued
Classification of
EXPENDITURES - -Continued
Expenditures
(Disbursements)
Agriculture Department--Continued
Foreign Agricultural Service.........................
International Agricultural Development Service........
Commodity Exchange Authority. • ••• • • • • • •• •• • • • •• . ...
Agricultural Stabilization and Conservation Service:
Expenses ........................................
Sug~r act program .......... ......................
P.gncultural conservation program................
Cropland conversion program......................
Cropland adjustment program . . . . • . . . . • • • • • • • • • • • • •
Emergency conservation measures .................
Conservation reserve program (soll bank)...........
Indemnity payments to dairy farmers •••••••••••••••
I
This Month
Applicable
Receipts
I
I
Current Fiscal Year to Date
Net
Expenditures
Expenditures (Disbursements
23 669
$,
Applicable
Receipts
I
I
$23 6691
, 209
1-732
$3,357
-127
138
51'3528
...........
, 94
...........
11,707...........
17
...........
42
•• • . • • •• . • •
275
...........
20...........
2
•. .•.. .. . .•
51'394
528
1'707
1 ,
17
42
275
20
2
,
....... '.~.'
4- 314
147 314
187'052
7
"
........... I
87,052
198'570
.:::::::::: 1
198570
2' 5 2 '
I
2'952
9.
. .........
,
79 , 509
79 , 509
• •• • • • . • • ••
7 " 128
7,128
...........
106'720 I
106,720...........
, 130 i
130.. . .• .•. .• •
Total--Agrlcultural Stab. and Conservation Service
18,984
...........
18,984
629,373.. .... .....
Commodity
Credit Corporation:
Publlc enterprise
funds:
Price support and related programs ..............
Special activities ...............................
Foreign assistance and special export programs .......
588,563
558
215,302
$1,315,470
242
840
-726,907
316
214,463
I
1-~~~· .. ······.. .
S24 783
~
I'
10,838,777
99,558
1,345,767
629,373
$7,080,718
40,633
29,756
3,758,058
58,726
1,316,010
1-
804,423
1,316,551
-512,128
-848...........
3,529
527
1,042
...........
12,284,102
1 ::::::
::::: u::
.=_~~- _
I'...........
.. .. .... ..
1 516
,
139 755 '
83,829
219,363 I
3 127
83 , 744
5 , 403
121'802
' 264
...........
657,286
...........
-
4,429,102
5,132,794
10,021,769
-848
3,002
1,042
11,270...... .....
46,459
38,821
13,333
...........
11,270
7,638
13,333
10,310 i ...........
48,655
33,400
12,664 , ...........
30,769 I . . . . . . . . . . .
57,819 ' .... .......
...........
...........
31,207
61,839
5,574
11,383
3
16,218
6,450
691
2,605
114,917
179
11,817
3,202
5
2,970
-103,533
-176
4,401
3,249
686
57,632
144,204
6,198
208,949
25,327
2,653
60,025
183,977
2,849
120,237
26,326
1,116
-2,394
-39,773
3,349
88,711
-999
1,538
35,482!
44,646
8,594
107,047
20,652 i
2,622
47,680
58,635
2,249
112,962
24,966
1,325
Total--Farmers Home Administration ............
47,516
132,724
-85,208
538,008
394,531
143,478
307,631
247,817
28...........
230...........
1,069
...........
390
...........
119...........
372
...........
49
...........
28
230
1,069
390
119
372
49
426...........
2 744
12;956
:::::::::::
4,788
...........
2,053. •
• ........
4,429
...........
2,823
...........
1 1 7 . .. • .. .. • ..
83
...........
-417
383
554.. .. .. .. • ..
4,507
...........
426
2 744
12;956
4,788
2 053
,
4,429
2 823
'
554
4,507
••• ••• .....
...........
...........
134,506
-&Y1
35,140
-134,506
1,453...........
473,131
...........
•• ..........
512,836
1 453
473'131
-512;836
1,069,015
1,aM 308
-615 alii
3.
~-
I
i-I
31,207
61,839
Tota.l--Aa;rlc:ulture Department.............................. ....
657,286
5,592,667
7,151,308
1,977
5,219
. . . 100000ote. on Pac-
i
'
------j-- -
...........
...........
Intragovernmental funds (net) .••••.•••••••••.••••••
Other .................. .........................
Proprietary receipts from the pubUc..................
Intrabudgetary transactions...... ....................
I
3,115,758
-165,248
1,478,592
1,977
5,219
Forest Service:
,
,,5,285,422 I
269,728 '
37,517
Federal Crop Insurance Corporation:
Administrative expenses..........................
Federal Crop Insurance Corporation fund.... ........
Rural Electrification Administration..................
Farmers Home Administration:
Community development programs..................
Salaries and expenses .................... .........
Public enterprise funds:
,
Direct loan account .............................
Rural housing insurance fund.....................
Emergency credit revolving fund .................
Agricultural credit insurance fund ................
Rural housing direct loan account.................
Other........ .................... ................
Rural Community Development Service •••••••••••••••
Packers and Stockyards Administration. • • • • • • • • • • • •• •
Office of the Inspector General.............. .........
Office of General Counsel... .......... ...... .........
Office of Information................................
.Na 11onal Agr i cu ltur al Library........................
Office of Management Services.......................
General administration:
Intragovernmental funds (net) •••••••••••••••.••••••
Salaries and expenses.............................
-=~
I
~
I
S24,783
-444
1,516
139 755
83,829
219,363
3 127
83 , 744
5 , 403
121'802
264
...........
• • • ••• •• • • .
........... ,
...........
. •...•....•
8,401,180
104,480
1,516,109
-
Total--Commodity Credit Corporation and foreign
assistance and special export programs ••••••••.
Net
Expenditures
Applicable
Receipts
Net
Expenditures
Expenditures (Disbursements
$3,357...........
-127...........
138
........... _
7
...........
I
Comparable Period Prior Fiscal Year
I
10,310
15,255
12,664
I
30,769
57,819
I
-607
35,140
(*)
...........
..
(*)
..
16 . .
"..
( .. )
...........
a.,
8 0fI7 4815
....
I
( .. )
., 7",
....
oas
I
I
i
390 , ........... I
2 600 I
I
12;077
4,412
.........
1 638
• •
,
.
.
.
.
.
......
6,786...........
2 609
, . . . . • ••••••
_~. .. • .. • .. ..
4 335
I ::::::::::: '
'
•.••...••••
-1 566
488'950
...........
' · · ..
-12,198
-13,990
6,345
-5,914
-4,314
1,297
59,814
390
2 600
12'077
4' 412
1'638
,
6,786
2 609
,
_~
4 335
I
1 5
48s/~
............
395·385
,
~9II/385
............
.... .•..••.
• •.•••..••
__ I::'.~~~~ ___ '-_.e~_~.~ d
I
8,785,7"
SECTION A-- THE EXPENDITURE ACCOUNT --Continued
Classification of
EXPENDITURES - -Continued
ExpendItures
(Disbursements)
Commerce Department:
General administration •.•••.•..•.••••................
Business Economics and Statistics:
Office of Business Economics •..••• , •••..•••.•.••.••
Bureau of the Census .•••.••••...••..••.............
Economic Development Assistance:
Public enterprise funds •.....••••..•.....••.•...•••.
Other •••.••.•....•...••••..................••.....
Promotion of Industry and Commerce:
Business and Defense Services Administration •.•••••.
International Activities •.•......•.••.•.••••.•••••.•. '
Office of Field Services ••••••••.•••.•.•....••..••••
Participation in U. S. Expositions .••••••••.••.••••••••
Foreign Direct Inyestment Control, ..............••.... ,
U. S. Travel ServIce •••••••••••••.•..•.•..•..•.•.... !
Total--Promotton of Industry and Commerce •••••••.
............
............
$414
21
9,141
19
21,187
i
Science and Technology:
Environmental Science Services Administration ••••••• 1
Patent Office ••••.••.•••......••••••••••••....•...• :
,
National Bureau of Standards:
Intragovernmental funds (net) •••.•••••••••••••••••• !
Other ••.•..•...•.••.•••..••••••••.•••.••••••.••. ,
Office of State Technical Services .•..•••.•.•.....•.. '
22,087
Total--Sclence and Technology •.•.••.•••••.••.•..•
I
$6,179
-1,260
143,142
...........
6,541
19,348
4,554
5,120
2,698
48,135
3,667
38,058
$11,766
_7,892
177,712
4,919
143,142
...........
...........
6,086
21,213
5,132
1,361
2,009
3,739
6,541
19,348
4,554
5,120
...........
...........
...........
2,005
............
..............
2,698
48,135
$1,519
-1,499
21,187
3,875
177,712
...........
349
1,000
419
60
362
305
6,086
21,213
5,132
1,361
2,009
3,739
-538
4,101
736
3,667
38,058
...........
21
9,141
14,253
3,536
...........
$4,327
............
3,295
349
1,000
419
60
362
305
$4,327
$5,593
$5,593
............
............
............
............
.............
............
............
.............
...........
...........
...........
...........
$414
...........
...........
...........
...........
...........
3,295
40,340
...................
40,340
.............
............
14,253
3,536
178,595
42,619
............
178,595
42,619
............
............
............
-538
4,101
736
-3,316
41,583
4,838
...........
...........
...........
...........
............
22,087
264,320
..............
21,265
-6,404
8,292
7,127
161,741
194,703
126,582
21,265
2,406
483,026
.............
38,368
174,257 !
38,346
••• e . . . . . . . .
..............
2,005
38,368
...........
...........
174,257
38,346
-3,316
41,583
4,838
1,821
40,137
4,100
...........
...........
...........
1,821
40,137
4,100
............
264,320
258,741
...........
258,741
............
..........
161,604
137
194,703
126,582
183,702
200,130
134,931
...........
............
203,740
-20,038
200,130
134,931
161,604
23,335
518,783
...........
······ .. :4;720
203,740
26,273
-7,503
321,422
-23,335
-7,503
. ..........
315,023
-26,273
-4,720
I
Ocean ShIPPIn~:
Maritime A ministration:
Publlc enterprise funds ••.••..•...•...•••.•...•••.
Operating differential subsidies .••....•..••........
Other •••••••••••••••••••..•..••.•..•.•..•••.....
14,861
8,292
7,127
,
I
.............
30,200
Total- -Ocean Shipping •••...............•........
Proprietary receipts from tne pUOlIC .......•........•..
Intrabudgetary transactions ................ : ..........
. ...... ~i; !lis
............
9,015
-2,406
-1,915
Total--Commerce Department .•...•••..••.•....•...
84,531
25,189
59,341
1,018,197
196,706
821,491
1,005,265
236,191
769,074
............
............
.............
900,095
549,210
505,327
215,572
8,929,896
6,139,001
6,187,439
2,444,341
............
..........
..............
.............
8,929,896
6,139,001
6,187,439
2,444,341
8,332,122
5,720,862
5,006,060
2,094,746
............
.............
. ...........
8,332,122
5,720,862
5,006,060
2,094,746
23,701,478
...........
23,701,478
21,953,789
. ..........
...........
............
..........
...........
8,215,873
5,781,553
7,061,527
1,096,662
8,204,779
5,164,016
6,211,171
997,860
22,155,615
Defense Department:
Military:
Military personnel:
Department of the Army .•.• , •••••.•.•• , ••.•..•..
Department of the Navy •••••••••••.••••••..•.•...
Department of the Air Force •••••••••••••••••....
Defense agencies •••••••••••••••••••••••••••...•
900,095 II
549,210
505,327
215,572
•••••• a •••••
••• 6 •••••• ••••
Total--Military personnel •••••••••••••••••..•.
2,170,204
............
2,170,204
Operation and maintenance:
Department of the Army ••••••••••••••• , •••••.••.
Department of the Navy •••••••••••••••••••.•...••
Department of the Air Force··················· ..
Defeilse agencies •••••••.••••••.• , ••••••••• " .•••
911,302
679,965
679,497
98,541
.............
! ............
911,302
679,965
679,497
98,541
8,215,873
5,781,553
7,061,527
1,096,662
2,369,304
22,155,615
477,479
914,048
817,260
8,460
6,183,986
8,516,224
9,314,661
53,979
...........
...........
2,217,247
24,048,850
Total--Operatlon and maintenance •••••••••••...
I
2,369,304
Procurement:
Department of the Army ••••.••••••••••••••••...•
Department of the Navy .••••••••••••••••••••.•••
Department of the Air Force •••••••••••••••• •••••
Defense agencies ••••••••••••••••••••••••••.•...
477,479
914,048
817,260
8,460
Total- -Procurement ••••••• , •••••••••••••• " ••.
2,217,247
I
............
............
............
............
. ...........
............
............
............
. ..........
. ..........
21,953,789
20,577,826
. ..........
. ..........
. ..........
...........
. ..........
20,577,826
. ..........
6,163,986
8,516,224
9,314,661
53,979
5,841,011
7,991,665
9,407,689
42,354
.. ..........
..........
............
..........
5,841,011
7,991,665
9,407,689
42,354
.. ..........
24,048,850
23,282,719
...........
23,282,719
. ..........
8,204,779
5,164,016
6,211,171
997,860
......
00
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT --Continued
Defense Department--Contlnued
Military- -Continued
Research, development, test and evaluation:
Department of the Army .........................
Department of the Navy .........................
Department of the Air Force .....................
Defense agencies ...............................
Expenditures
(Disbursements)
Applicable
Receipts
Net
Expenditures
Expenditures (Disbursements)
7,462,459
7,462,459
7,747,380
7,747,380
49,246
49,508
42,990
257
474,776
405,850
491,338
10,066
474,776
405,850
491,338
10,066
677,986
92,967
492,064
18,322
677,986
92,967
492,064
18,322
142,001
1,382,031
1,382,031
1,281,339
1,281,339
-$2,519
2,113
62,194
15,724
562,638
$155
15,569
562,638
367
494,678
367
494,678
-2,519
64,307
578,363
155
578,208
495,045
495,045
5,316
111
86,078
1,258
86,078
1,258
107,637
1,724
107,637
1,724
133
2
-2
-21
2,153
1
(*)
5
-20
941
-37
622
2,511
-161,728
-156,390
-32,039
-67,025
-203,470
-369,952
-502,276
-320,447
-203,470
-369,952
-502,276
-320,447
804,269
1,138,244
76,835
76,894
135
-417,205
-1,393,985
1,277
-1,395,261
2,099,382
1,207
2,098,175
3,294
37,537
7,509
35,149
33,885
127,756
157,877
-8,035
2,388
7,509
-127,756
-8,035
26,404
7,849
6,319
-1,557
1,251
-6,319
-2,898
-7,161
-7,481
7,849
-157,877
-7,161
7,229
7,278,359
78,059,156
164,336
77,894,820
77,573,933
192,969
77,380,963
137,325
-10,934
1,250,261
-5,846
1,250,261
-5,846
1,287,613
-3,533
6,899
43,386
163,070
43,386
-7,770
42,393
158,283
41,m
736,597
Military construction:
Department of the Army ............ _............ .
Department of the Navy ••••....••...............•
Department of the Air Force ..................... .
Defense agencies ............................... .
49,246
49,508
42,990
257
Total--Military construction ................... .
142,001
Family housing:
Homeowners assistance fund ..•..••..............•
Other .......•.......•.........•.......•.••..•...
-406
62,194
Total--Famlly housing ........................ .
61,787
Civil Defense ....•..•...........•..................
Special foreign currency program •...........••..•...
Revolving and management funds:
Public enterprise funds:
Department of the Army ..•..•...••...•••.......
Department of the Navy .•...........•.•.•••..•.
Department of the Air Force .........•••..•..•..
Defense agencies ......................•.......
Intragovernment funds (net):
Department of the Army ••••••.•..•.••...•......
Department of the Navy .•••••••.•...••.......••.
Department of the Air Force ••..•••....•••......
Defense agencies .....•.••..........•....•.....
5,316
111
-161,726
-156,390
-32,039
-67,025
Total--Revolvlng and management funds ....•.•.•...
-417,069
Trust revol vlng funds ••••••••••••••••••••••••••••••
Other •••••••••••••••••••••••••••••••••••••••••••••
Proprietary receipts from the public •••••••••••••••••
Intrabudgetary transactions .............••••••••••••
1,737
1,251
-2,898
Total- - Military ••••••••••••••••••••••••••••••••••
7,285,587
(*)
111
(*)
Net
Expenditures
tl,434,096
2,002,627
3,800,444
510,212
736,597
Total--Research, development, test and
evaluation. . . . . . . . . . . . . . . . . . . . . . . . . . . .. . ....
IExpenditures
Net
I(Disbursements)
Expenditures I Applicable
Receipts
$1,434,096
2,002,627
3,800,444
510,212
$1,520,626
2,045,904
3,390,727
505,202
$162,458
182,423
342,308
49,408
Applicable
Receipts
$1,520,626
2,045,904
3,390,727
505,202
$162,458
182,423
342,308
49.408
.
.
.
.
Comparable Period Prior Fiscal Year
Current Fiscal Year to Date
This Month
Classification of
EXPENDITURES - -Continued
I
3
.......... ..
........... .
.......... ..
.......... ..
22
1,213
42
5
1
$30
994
181
2
-25
-373
2,330
-1
804,269
1,138,244
76,835
76,894
bvtl:
Department of the Army:
Corps of Englneers:
Rivers and harbors and flood control •••.....•..•.
Intragovernmental funds (net) ••..••.••••••.....•
The Panama Canal:
Canal Zone Government ••.••.• _.••...••..•.•.••
Panama Canal Company ••..••••....•..••••••.••
Other •...•...•..•......• _....... _••..••..•••• _ .
137,325
-10,934
6,899
22,321
3,249
21,138
1,183
3,249
38,301
170,840
36,301
...........
172,423
1,287,613
-3,533
42,393
-14,140
41,m
SECTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
EXPENDITURES--Continued
This Month
Expenditures
(Disbursements)
Defense Department--Continued
Civil--Continued
Navy--Wildlife conservation, etc. . ......•.....•.....
Air Force - -Wildlife conservation, etc ••.....•.....•..
Soldiers' Home:
U. S. Soldiers' Home revolving fund ••......••••....
Other •••.•.•...••••..•..••..•...••.•..........•.
Proprietary receipts from the public •.......•....•...
Intrabudgetary transactions ...•....•.•..............
-3,051
Total--Civil .................................... .
156,580
Total- -Defense Department ••..••••......•.••...
Applicable
Receipts
(*)
17
747
Appltcable
Receipts
Applicable
Receipts
Net
Expenditures
$13
$13
7
10,297
-44,571
-14,589
145
9,967
...... ~i2:302
215,570
1,267,528
1,524,394
224,808
1,299,586
79,098,327
417,777
78,680,549
545
62,267
88,310
$5
46
$14
2
4,730
747
-4,730
-3,051
167
10,297
...............
44,571
130,698
1,483,098
25,882
IExpenditures
Net
I(Disbursements]
Expenditures I
$5
46
$7
(*)
$7
Comparable Perio:! Prior FIScal Year
Current Fiscal Year to Date
I
Net
Expenditures I
Expenditures (Disbursements)
$159
-14,589
43
43
$141
............
52,244
4
9,967
-52,244
-12,302
7,442,167
33,111
7,409,056
79,542,254
379,906
79,162,348
333
7,150
11,062
343
-10
7,150
11,062
3,135
61,305
111,635
3,893
-758
61,305
111,635
3,509
62,267
88,310
2,964
18
41,709
37,023
21,281
21,048
8,110
13
6
41,709
37,023
21,281
21,048
8,110
179
285,558
248,273
264,059
171,710
116,047
183
-4
285,558
248,273
264,059
171,710
116,047
204
233,089
188,181
258,520
157,238
126,264
206
Total--Health Services and Mental Health
Administration ...•.•.•.•.........•..........•.
129,188
13
129,175
1,085,827
183
1,085,644
963,496
206
963,290
National Institutes of Health:
Public enterprise funds .................•...........
Institute research and training activities ...••.........
Health manpower and dental health ..•.......•..•.....
Construction grants ........•...•...................
Other ...•...............•.•.••..............••...•
203
37,143
2,280
26,517
-6,437
10
193
37,143
2,280
26,517
-6,437
18,604
950,648
115,798
138,979
103,978
131
18,473
950,648
115,798
138,979
103,978
18,152
977,683
82,175
107,130
106,566
7,083
11,069
977,683
82,175
107,130
106,566
10
59,696
1,328,008
131
1,327,877
1,291,706
7,083
1,264,623
213
35,649
49,610
202,898
111,323
2,886
57,968
-144
-115
13,431
259,875
389,913
1,433,049
916,916
19,747
340,637
612
8,392
-727
5,039
259,875
389,913
1,433,049
916,916
19,747
340,637
11
6,198
265,107
506,373
1,417,002
895,421
144,066
288,386
56
5,680
-45
518
265,107
506,373
1,417,002
895,421
144,066
288,386
460,603
3,373,452
9,004
3,364,449
3,522,564
5,736
3,516,828
116,765
136,776
116,765
136,776
3,168,449
2,161,341
3,168,449
2,161,341
173,854
281
53,154
38,873
31,024
316,993
53,154
38,873
31,024
316,993
610,094
350,910
250,467
547,455
610,094
350,910
250,467
547,455
571
571
280,713
218,308
5,293,023
280,713
218,308
5,293,023
693,586
693,586
7,088,716
7,088,716
5,966,751
5,966,751
Health, Education, and Welfare Department:
Consumer Protection and Environmental Health Service:
Public enterprise funds .....................•.......
Food ana drug control .•........•...•...............
Ail' pollution and other •...........•.•.....•...•....
Health Services and Mental Health Administration:
Public enterprise funds •........•..•........•...•...
Mental health ........••.•.......••....••...•.......
Health planning and regional programs ••.....•..•....
Hospital construction ...........•.....•.............
Direct care programs .....•••....••...•............
Other.......•...•.....•...•.•......•.•........•....
Total--National Institutes of Health .......•..••.....
59,706
Office of Education:
Public enterprise funds:
Student loan insurance fund ...............••.••.••.
Higher education facilities loan fund ••..•.•......••.
Assistance for vocational education..••.••.•.••.......
School assistance in federally affected areas .....•..•.
Elementary and secondary educational activities •..•.•.
Higher educational activities .•............•.........
Defense educational activities .••.•.........•........
Other .........••.•.•.......••..........•..........
738
35,849
49,610
202,898
111,323
2,886
57,968
Total- -Office of Education ......•..•......•.••....
461,273
Social and Rehabilitation Service:
Grants to States for maintenance payments ..•.....••..
Grants to States for medical assistance •.•.•.......•.•
SOCial service, administration, training, and
demonstration projects .•...•.•.......••........•.
Grants for rehabilitation services and facilities
Grants for maternal and child welfare ...••••.••......
Other .......•.........•......•..........•.•...... ,
Total--Social and Rehabilitation Service .......... .
144
526
670
-2
233,089
188,181
258,520
157,238
126,264
173,854
281
-0
o
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT--Continued
I
Current Fiscal Year to Date
This Month
ClassUication of
EXPENDITURES--Continued
Expenditures
(Disbursements)
Applicable
Receipts
Expenditures
Net
Expenditures Disbursements)
Applicable
Receipts
Comparable Period Prior Fiscal Year
Expenditures
Net
Expenditures Disbursements
Appllcable
Receipts
$6,216
$6,081
Net
Expend Itures
I
Health, Education, and Welfare Dept. --Cont'd.
Social Security Administration:
Operating fund, Bureau of Federal Credit Unions ••.•.•
Payment to trust funds for health insurance for
the aged. •. • . . . . . . . . . . . • • . . . • . ••• • . • • • •• . • • ••• ••
Payment for military service credits........... . • •• .
Payment for special benefits for the aged ••••••••••••
Federal old -age and survivors ins. trust fund:
Administrative expenses and construction..........
Benefit payments................................
Vocational rehabilitation services ••••••• , •••••••••
Payment to railroad retirement account ••••.•••••••
$649
$240
$6,411
............. .............
71,487
............. .............
.............
1,737,168
210,000
225,545
$409
S6,166
491,482
2,030,319
..............
............. .............
491,482
...................... ..
466,100
23,732,309
725
491,482
.............
.............
.............
.............
.............
.............
.............
Total--Federal old-age and survivors insurance
trust fund ••.•••••••••••••••••••••••••.••••••
2,545,116
.............
2,545,116
24,690,616
.............
Federal disability insurance trust fund:
Administrative expenses and construction •••••••.••
Benefit payments •••.•.•••••••••••••••••••••••••••
Vocational rehabilitation services ..•••••••••••••••
Payment to railroad retirement account .•.•••••••••
8,129
215,592
1,969
21,328
132,433
2,443,262
15,972
21,328
Total--Federal disability ins. trust fund •••••••••
247,018
.............
..............
.............
8,129
215,592
1,969
21,328
247,018
2,612,995
.............
.............
.............
.............
.............
Federal hospital insurance trust fund:
Administrative expenses and construction •••••••••.
Benefit payments .••.••••••••••••••••••••••••••••
8,148
397,592
.............
.............
8,148
397,592
104,196
4,653,976
Total--Federal hospital ins. trust fund •••••••••••
405,740
.............
405,740
4,758,172
I
71,487
• .••.••••..•..••
. •.•..•.•.••..••
23,315
2,030,319
I ................
..............
.............
.............
Federal supplementary medical ins. trust fund:
Administrative expenses and construction ..•.••••••
Benefit payments .•.•••.••••••••••••••••.••••••••
24,432
140,428
Total--Federal sUf,Plementary medical
insurance trust und •••••••••••••••••••••••••
164,861
.............
.............
.............
Other ••....••••••••••.•••••.••••••••••••••••••••••
9
Total--Social Security Administration ••••••••••••••
3,434,879
Special institutions:
American Printing House for the Blind ••••••••••••••
National Technical Institute for the Deaf
Model Secondary School for the Deaf ••• : : : : : : : : : : : : : :
Gallaudet College •••..••••••..•••••••••.•••••••••••
Howard University and Freedmen's Hospital ••••••••••
Departmental management:
Intragovernmental funds (net) ••••••••••••••••••••••••
Other ............................................
Proprietary receipts from the public •••••••••••••••••••
Intrabudgetary transactions:
Payments for health insurance for the aged:
Federal hospital insurance trust fund
Federal supplementary medical insur~'c"e' b;i~t .....
fund •••••••••••••••••.••••••••••••••••••••••••
Payments for military service credits and special
benefits for the aged:
Federal Old-age and survivors insurance trust
F~~ai ·d~;'bi.UiY 'b.;ru;"~;';" i';';"'t' fund .••..••••••••
Federal hospital insurance trust fWld •••••••••••••
Receipts transferred to railroad ret1rem~;"t ·~';';~t·
Total--Health. Educat1on, and Welfare
: ::
23,315
............
21,622,188
132,433
2,443,262
15,972
21,328
112, 367 1 . . . . . . . . . . . .
2,088,412 i ............
15,393 ••••••••••••
20,410' ••••••••••••
112,367
2,088,412
15,393
20,410
2,612,995
2,236,583
............
2,236,583
............
..............
104,196
4,653,976
78,672
3,736,322
:::::::::::: I
78,672
3,736,322
.............
4,758,172
3,814,994
.............
.............
164,861
1,839,528
.............
9
-28
.............
.............
409
3,434,470
36,080,407
240
65
8
15
2,701
1,340
1,783
143
4,206
30,358
-381
2,606
-2,769
................. .............. ................
-71,487
437,634 : ••••••••••.•
194,687
1,644,841
.............
..............
............
.............
.............
-361 .............
2,606 .............
................
2,769
...............
-71,487
.....................
.................. .............
............... ................
................ .
.....
··· .. ···:ⅈilio . .............
..... .... ·····:5i2;ilio
1,737,168
210,000
225,545
466,100
23,732,309
725
491,482
447,408 : ••••••••••••
20,736,868 I .••••••••••.
24,690,616
21,622,188
277 I ••••••••••••
,
i ••••••••••••
194,687
1,644,641
142,645[ ............
1,389,622 ••••••••••••
1,839,528
1,532,267 i ............
1,532,267
............
2
6,081
30,217,798
6,166
36,074,241
30,223,880
.............
.............
.............
.............
.............
1,340
1,783
143
4,206
30,358
1,225
345
17
3,039
25,755
43,066
............... .............
12,685
8lM
43,066
-12,885
-748,968
-988,2AlO
..............
..............
-~~88Ii ..............
.••.......•..
-22,000
-1112,810
.............
...............
142,645
1,389,622
'I
2
.............
3,814,994
1
-28
824
$135
906,631
906,631 ............
105,000
105,000 I ...•.......•
.............. ............ ................
447,408
20,736,868
277
437,634
24,432
140,428
240
65
8
15
2,701
$245
I
............
............
............
............
............
............
.............. ............
11,417
1,314
21,142
-748,968
-272,631
-968,2AlO
-634,000
............
............
-381,545
-32,000
-22,000
-512,810
-78,000
-18,000
-11,000
-tIWJ,OM
............
............
.............
............
,
1,225
345
17
3,039
25,755
1,314
21,142
-11,417
-272,631
-634,000
-78,000
-18,0lI0
-U,OID
....,.,..
SECTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
EXPENDITURES - -Continued
Comparable Period Prior Fiscal Year
CUrrent Fiscal Year to Date
This Month
Expenditures
J (Disbursements)
Expenditures
(Disbursements)
Expenditures
(Disbursements
Net
Expenditures
Housing and Urban Development Department:
Renewal and housing assistance:
Public enterprise funds:
College housing loan fund ••••••••••••••••••••••••
Urban renewal programs •••••••••••••••••••••••••
Low-rent public housing •••••.•••••••••••••••••••
Housing for the elderly or handicapped ••.••.•••••••
Other ••••••••••••••••••••••••••••••••••••••••••
Other •••••.•••••••••••••••••.•••••••••••••••••••
$6,451
44,628
34,526
574
23
2,285
Total--Renewal and hOUSing assistance •••••• , • • . • •
88,487
Metropolitan development:
Public enterprise funds:
Urban mass transportation fund •••••••••••••••••
Other •••••••••••••••.••••••••••••••••••••••••••
Open space land programs •••••••••••••••••••••••••.
Water and sewer facilities ••••••••••••••••••.•••••••
Other •••••••••.••••••••••••••••••••••••••••••••••
174
1,122
4,975
7,690
4,573
•...... i;800
174
-738
4,975
7,690
4,573
7,860
24,493
43,278
80,189
40,750
5,852 .
20,448
2,009
4,045
43,278
80,189
40,750
66,100
24,233
33,339
44,444
31,889
202
18,623
65,898
5,611
33,339
44,444
31,869
Total--Metropolitan development .•••••••••••••••.
18,534
1,860
16,674
196,571
26,300
170,271
199,986
18,825
181,161
15,284
1,339
8,654
4,211
1,856
4,057
Demonstrations and intergovernmental relations:
Model Cities programs •••.•••••••••••••••••••••••.
Other............................................
Urban technology and research.......................
Mortgage credit:
Federal Housing Administration:
Public enterprise funds;
Federal Housing Administration fund •••••••••••
Other •••••••••••.••••••••••••••••••••••••••••
Other ••.••...•••••••••••••••••••••••••••••••••.
Government National Mortgage Association:
Management and liquidating functions ••.••••••••••.
Special assistance functions ••••••••.•••••••••••••
Participation sales fund ••••••••••••••••••••••••••
Secondary market operations ••..•••••.•...••.••..
Proceeds from sale of Federal National Mortgage
ASSOCiation (net) •.....•••..•.•..••••......•.
Total- -Mortgage credit .....•.....••.•••...•.•.
L
-72
2,285
$150,215
547,528
351,057
7,303
271
46,181
$97,358
17,600
11,767
11,053
935
............
$52,857
529,928
339,291
-3,750
-664
46,181
665
.............
407
$104,742
492,561
288,367
2,275
151
37,113
15,284
............
1,339
............
8,654............
1
64,335
140
-18,015
28
1,086
427,611
-1,568
6,414
573,876
3,597
-146,265
-5,165
6,414
311,196
-357
2,124
8,944
5,850
-5,182
12,500
12,500
-3,556
-6,850
-5,182
140,129
132,227
-54,517
37,143
147,924
142,036
............
67,180
-7,795
-9,809
-54,517
-30,037
114,324
92,298
-30,682
289,685
I· ...... · ......
165,744
-32,288
687,437
1,100,356
-412,919
-1,924
2
-1,924
28,178
5,622
•.... · .. 5;622
-5,452
554
2,000
11,449
-33,630
554
2,000
11,449
-253
-7,825
I~
~-~~I~
57,187
Total- -Housing and Urban Development Department •••
168,981
89,475
2
-1
..............
-7,825
98,514
8,760
70,467
-38,144
20,301
17,970
7,674
............
............
............
............
8,760
-317
-38,144
20,301
17,970
7,674
16,561
317
16,244
3~'"
$91,323
15,830
8,583
7,966
206
............
925,210
46,320
168
1,086
...............
Total--Public Land Management..•...•.•••..••.••
$2,629
43,770
33,098
-402
1,102,556
665
61
...............
407
Federal Insurance Administration:
Public enterprise funds ........................... .
Other ........................................... .
Fair housing and equal opportunity ••....•..•.....••...
Departmental management .•...•••..•......•••...•...
Proprietary receipts from the public ••••••.•......•...
Intrabudgetary transactions .....•...••......•..•..••.
Interior Department:
Public Land Management;
Bureau of Land Management .....•........•..•....•
Bureau of Indian Affairs:
Public enterprise funds .•.•...•........•...•.••..
Indian tribal funds ...•••...•.......•...•....•.•.
Other ....•..•....•.....•.•...•.......••........
Bureau of Outdoor Recreation •........•••..••..•..•
Office of Territories ..•..••...•.....•.•...•.••....
$3,822
858
1,429
975
95
............
........... .
253
;j. . l
801,302
4,211
1,856
4,057
•
484,432
1,654
-173,236
-2,010
2,124
128,332
116,784
-14,008
-24,487
-30,682
-40,720
•••••••••• a
330,405
-165,744.... .........
778,588
$13,420
476,731
279,784
-5,691
-55
37,113
.. .......... .
1,061,607
.. ..... 'Ii;iiji
-283,019
........ 9;isi
.............
43
-43
-12,449
1,910,619
1,204,382
706,236
-12,449
1,293,801
718,765
167,391
.... ·:;
..
.............
743
120,585 ............
270,421............
129,449
............
00,619
............
167,391
-743
120,585
270,421
129,449
60,619
021
150,
1,558
440
87,333
............
238,079............
103,336... .........
45,791
............
150,021
1,118
87,333
238,079
103,336
45,791
747,720
626,118
625,678
2,012,566
748,464
743
1...........
440
.........
to.)
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT --Continued
Interior Department--Continued
Mineral
Resources:
Geological
Survey..................................
Bureau of Mines:
Public enterprise funds ••.••••••••••.•••••••••••••
Other...........................................
OfficeofCoaIResearch.............................
Office of Oil and Gas...............................
Total--Mineral Resources........................
Fish and Wildlife, Parks, and Marine Resources:
Bureau of Commercial Fisheries:
Public enterprise funds...........................
Other...........................................
Bureau of Sport Fisheries and Wildlife .... ...........
National Park Service ..............................
Total--Fish and Wildlife, Parks, and
Marine Resources .............................
Water and Power Development:
Bureau of Reclamation:
Public enterprise funds:
Continuing fund for emergency expenses,
Fort Peck project, Montana •••••••••••••••••••
Upper Colorado River Basin fund •.•••••.••••••••
Other •.••••••••••••.•••••••••••.••••.•••••••••••
Alaska Power Administration •••••••••••••••••••••••
Bonneville Power Administration •.••••••••••••••••••
Southeastern Power Administration ••••••••••••••••••
Southwestern Power Administration ••••••••••••••••••
Total--Water and Power Development
Expenditures
(Disbursements)
AQpllcable
Receipts
Net
Expenditures
Expenditures (Disbursements)
Applicable
Receipts
ItExpenditures
Net
••••••••••••
$6,831
1,272
4,588
1,508
-7
$1,166
••••••••••••
••••••••••••
•• ...... ....
106
4-,588
1,508
-7
33,989
56,341
8,684
874
14,192
1,166
13,026
192,034
594
79
4,920
............
12,796 ............
10,715............
515
4,920
12,796
10,715
29 026
'
28 947
,
I
Applicable
Receipts
Net
Expenditures
$92,146
$88,088
16,133
56,341
8,684
874
51,749
52,897
11,862
722
.......... .
17,856
174,178
205,318
21,911
183,407
925
51,537
109,327
131,701
661
............
............
............
264
51,537
109,327
131,701
1,152
150
50,099
...........
101,912
...........
125,578...........
1,002
50,099
101,912
125,578
?!R490
---
661
292,829
278,741
150
278,591
117,856
•••••••••••••
•••••••••••••
.............
29,838
52,897
11,862
722
121,911
I
-3,515
17,908
254,978
913
130,514
874
7,648
1,515
70,004
244,572
805
163,559
602
7,647
...........
..
.........
.......... .
-3,235
37,903
244,572
805
163,559
602
7,647
409,321
488,704
36,852
451,852
36,151
214,940
28,591
184,083
...........
...........
28,591
184,083
............
............
............
............
1,049,527
............
5,526
8,209
10,842
-1,022
-1,049,527
-32,531
5,193
7,387
8,962
229
..............
-38,947
...........
...........
...........
• ..........
1,518,144
...........
5,193
7,387
8,962
229
-1,518,144
-38,947
1,577,497
216,883
78,747.. .........
192,850
...........
82,084
...........
78,747
192,850
82,084
117
1,383
23,564
70
8,514
53
515
1,500
53,154
254,978
913
130,514
874
7,648
5,014
35,247
3,307
34,215
449,582
40,261
2,673
23,627
36,151
214,940
............
............
617
5,526
1,085
8,209
363
10,842
-770
-1,022
-90,835 ...............
.............
-32,531
214
4,592
23,564
70
8,514
53
515
97
3,210
37,523
Water Quality and Research:
Office of Saline Water..............................
Federal Water Pollution Control Administration......
Secretarial Offices:
Office of the Solicitor. ..............................
Office of the Secretary..............................
Office of water Resources Research.................
Virgin Islands Corporation............................
Proprietary receipts from the public •••• •••• ••••••••••
Intrabudgetary transactions...........................
2,673
23,627
............
............
617
1,085
363
-770
..............
..............
............
............
............
............
90,835
............
Total--Interior Department ...................... ,
124,896
95,703
29,193
1,925,684
1,109,048
816,635
5,950
18,182
7,156
............
............
............
5,950
18,182
7,156
86,602
217,560
90,015
• ...... .....
............
............
86,602
217,560
90,015
4,325
323
6,385
3,103
1,226
..............
foe,8li1
............
319
..... .......
............
............
261
4,325
-3,118
4
3,638
6,385
79,250
3,103
33,563
1,226
17,350
-261 .. .............
............
3,700
... .........
............
.............
I,M7
5,847
-3,118
-62
79,250
33,563
17,350
-1,M7
Justice Department:
Legal activities and general administration.............
Federal Bureau of Investigation.. ................... •••
Immigration and Naturalization Service •••• ••• .........
Federal Prison System:
Federal Prison Industries, Inc. (net).................
Federal Prison commissary funds....................
Other....................... .......................
Law Enforcement Assistance Admimstration............
Bureau of Narcotics and Dangerous Drugs..............
Proprietary receipts from the public...................
Total--JusUce Department........................
Expenditures
(Disbursements)
$88,088
$92,146 I •••••• •••• •••
$6,831
79
Comparable Period Prior Fiscal Year
Current Fiscal Year to Date
This Month
Classification of
EXPENDITURES - -C ontinued
IiIII
46,0'11
531,.1
1
518,51.
1,794,379·
-4,747
3,126
73,865
8,301
3,375
..............
0637,801
4,750
32,101
...........
3,182
...........
...........
...........
4,380
7,582
-4,747
-56
73 885
8'301
S'S7D
"';'80
oUO,OI8
SECTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
EXPENDITURES- -Continued
Labor Department:
Manpower Administration:
Manpower development and training activities .•••.•••
Office of Manpower Administrator ••••••••••••••••••.
Bureau of Apprenticeship and Training ••••••••••••••
Bureau of Employment Security:
Advances to employment security administration
account, unemployment trust fund •••.••••••••••
Unemployment compensation for Federal
employees and ex-servicemen •••••••••••••••..
Salaries, expenses and other •••••••••••••••••••••
Unemployment trust fund:
Employment security administration account:
Salaries and expenses •.•.•••••••••.•••..••••.•
Grants to States for unemployment compo and
employment service adm ••••••••••••.•••••••.
Payments to general fund:
Reimbursements and recoveries ••••••••••••••
Interest on refunds to taxes ••••••••••••••••••
Interest on advances from general
(revolving) fund...........................
Railroad unemployment insurance account:
Benefit payments..............................
Interest on advances from railroad retirement
account....................................
Railroad unemployment insurance adm. fund .......
State accounts: Withdrawals by States.............
Federal extended compensation accounts...........
Comparable Period prior Flecal Year
Current F1scal Year to Date
This Month
Net
Expenditures
Applicable
Net
Expenditures
Applicable
Net
Applicable
ExpendItures (Disbursements)
Receipts Expendltures (Dlsbursements) Receipts
Expenditures
Receipts
I
Expenditures
(Disbursements)
$42,192
2,385
635
$42,192
2,385
635
I
I
I
I
$377,344
29,243
9,193
$377,344
29,243
9,193
$356,937
33,903
8,203
$356,937
33,903
8,203
-3,832
-3,832
-3,271
-3,271
9,689
-2,461
9,689
-2,461
125,749
5,014
125,749
5,014
107,029
2,746
107,029
2,746
3,532
3,532
17,929
17,929
17,869
17,869
92,023
92,023
588,693
588,693
551,589
551,589
137
27
137
27
9,555
248
9,555
248
9,362
251
9,362
251
...............
............
..... .......
3,832
..........
3,832
3,271
...........
3,271
6,625
............
6,625
96,589
..........
96,589
75,724
...........
75,724
4,639
353
135,867
.......... .....
............
............
............
............
4,639
353
135,867
............
5,730
6,191
2,061,135
..........
..........
..........
5,730
6,191
2,061,135
7,130
6,514
2,074,137
...........
...........
...........
7,130
6,514
2,074,137
(*)
.... ......
(*)
(*)
••• ........
(*)
243,204
............
243,204
2,789,901
..........
2,789,901
2,745,849
...........
2,745,849
Other .' .. . . .. .. .. .. .. .. .. .. .. .. .. • .. .. .. .. .. .. .. •
113
.... .. .. .. ..
113
370
........ ..
370
-33
.. .........
-33
Total--Manpower Administration •....••..•••••...
295,757
295;757
3,332,982
••••••••••
3,332,982
3,251,362
•••••••••••
3,251,362
Labor-Management Relations •.•••••••••••••••••••••••
Wage and Labor Standards:
Wage and Labor Standards Administration ••••••••••.
Bureau of Employees' Compensation:
Employees' compensation claims and expenses ••••.
Other ••.••••••••••••••••••••••••••••••••••••••
Wage and Hour Division •••••••••••••••••••••••••••
551
1,170
............
1,170
11,956
..........
11,956
10,118
...........
10,118
11,884
12
1,952
............
............
............
11,884
12
1,952
67,264
382
25,595
..........
..........
..........
67,264
382
25,595
61,804
478
23,499
...........
...........
•••••••••••
61,804
478
23,499
Total--Wage and Labor Standards ••••..•••••••••••
15,019
............
15,019
105,197
..........
105,197
95,899
...........
95,899
Bureau of Labor statistics ••••••••••••.••••••••••••••
Bureau of International Labor Affairs •••••••••••••••••
Office of the Solicitor •..••.••••••••••••••••••••••••••
Office of the Secretary:
Federal contract compliance and civil rights
programs ••.•••••••••••••.••••••••••••••••••...
Other ••••••••••.••••••••.•••••••••••••••••••••••.
Proprietary receipts from the public •••••••••••••••••.
1,341
298
523
21, 955 1 . . . . . . . . . .
1,660 ..........
6,185
..........
21,955
1,660
6,185
20, 659
1,118
5,693
...........
...........
...........
20,659
1,118
5,693
.......... .
Total--Labor Department .••••••••••••........••..•
313,759
Post Office Department: Postal Fund •••••••••••••••••••
538,542
Total--Unemployment trustfund .... ............
211
59
5511
I
.... · .. · .... 1
............
............
1, 341 1
298
523
8,9661
.......... 1
8,966 1
8,568 1 ........... 1
1
8,568
856
4,454
..........
$7,378
856
4,454
-7,378
1,115
4,028
$1,264
211
59
-1,264
$3,164
1,115
4,028
-3,164
1,264
312,495
3,482,254
7,378
3,474,877
3,388,441
3,164
3,385,278
441,730
96,813
7,272,769
6,285,403
987,366
6;793,911
5,714,395
1,079,516
3
See footnotes on page 3.
-
Co)
~
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT --Continued
This Month
Classification of
EXPENDITURES - -c ontinued
Expenditures
(Disbursements)
State Department:
Administration
of foreign affairs:
Salaries and expenses..............................
Acquisition,
operation and maintenance of buildings
abroad..........................................
Intragovernmental funds (net) .......................
service retirement and disability fund........
er . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International organizations and conferences:
Contributions to international organizations ......... .
Other ............................................ .
International commissions ........................... .
Educational exchange ................................ .
other •••••••••.•••••• , ., •••••••••••••• " •••••••••••
Proprietary receipts from the public ••••••••••••••••••
Intrabudgetary transactions:
Foreign service retirement and dtsab1lity fund:
Receipts transferred to Civil Service retirement
and disability fund .......................... .
Other ........................................... .
Total--State Department •••••••••••••••••••••••
I
3,571
-124
1,272
350
26,478
321
38,713
Total--Transportation Department ••••••••••••
538,177
~~-:!:r :!~!Xf:'':~ .r.~~ .. ~,i~id':H~ h~~· ~ ~ ~ .....
$377
377
981
5
780
$:&1,410
I Applicable
I Net I Expenditures IApplicable
I Expenditures
Net
Receipts Expenditures (Disbursements)
Receipts
8
18,659
167
14,144
3,129
243,649
321
118,526
5,693
14,776
46,342
11,515
1,261
4,908
4,930
-377
.............
.............
.. ...........
..........•..
.............
.............
$4,728
. .......... .
-72
-17
-430
38,336
440,054
981
15,843
-3
34
-3,912
551,305
38
19
780
57,583
57,583
$207,549 .............
3,571
-124
1,272
350
26,478
886
-72
Transportation Department:
Office of the Secretary .............................. .
Coast Guard:
Trust revolving funds ............................. .
Intragovernmental funds (net) ..................... .
other •••••••••••................................
Federal Aviation Administration:
Public enterprise funds ........................... .
Grants-in-aid for airports ........................ .
Other ••••••••••••••••••••••••••••••••••••••••••••
Federal Highway Admtntstratlon:
Highway beautification ............................ .
State and community highway safety programs ....... .
Highway trust fund:
Federal-aid highways ........................... .
Interest on advances •••••••••••••••••••••••••••••
Other ••••••••••••••••••••••••••••••••••••••••••••
Federal Railroad Administration:
Alaska Railroad .................................. .
other ........................................... .
Urban Mass Transportation Administration:
Urban mass transportation fund •••••••••••••••• " •••
other ........................................... .
Saint Lawrence Seaway Development Corporation •••••••
National Transportation Safety Board ••••••••••••••••••
Proprietary receipts from the publlc ••••••••••••••••••
Intrabudgetary transactions:
Highway trust fund ............................... .
Treasury Department:
Office of the Secretary:
.............
.............
.............
.............
.............
886
1,261
4,908
4,930
Comparable Period Prior Fiscal Year
Net
Expenditures
Expenditures (Disbursements)
Applicable
Receipts
$21,410 .............
~~~elgn
Total--Adminlstratlon of foreign affairs .......... .
I
Current Fiscal Year to Date
$207,549
$199,997
..... .......
$199,997
18,659
167
14,144
3,129
243,649
17,252
17
11,969
4,519
233,753
............
............
............
.....•......
............
17,252
17
11,969
4,519
233,753
118,526
5,693
14,776
46,342
11,515
-4,728
109,341
5,459
25,118
50,772
9,401
............
$9,356
..............
-466
..4~b I . .. • ........ A66
4,728
109,341
5,459
25,118
50,772
9,401
-9,356
9,356
424,023
435,325
433,379
15,843
9,393
-4
-3,912
551,305
42
5,040
540,310
41
1
5,040
540,310
-1
25
74,701
821,075
12
103,671
894,371
13
74,701
821,075
9,393
3
20,170
81,668
20,170
81,668
17
103,671
894,371
1,183
4,421
1,183
4,421
21,329
39,970
21,329
39,970
40,006
19,198
40,006
19,198
352,378
352,378
4,150,994
4,150,994
4,171,110
4,171, llO
5,135
5,135
50,385
50,385
63,277
63,277
23,913
15,522
24,004
9,917
3,636
........... .
3
1,969
1,456
2,059
-90
1,456
24,586
16,722
25,087
-501
16,722
9,354
73
679
337
133
9,221
73
54
337
-1,555
139,710
714
11,256
4,695
452
139,258
714
625
1,555
6,371
............ .
20,274
4,885
4,695
-20,274
6,395
19,656
..........15,088
'IO'l
4,380
533,797
'IO'l
6,021,693
T • ..,_J~
52,:M2
5,969,451
5,782,067
........... .
7.~
e.88!'
-91
15,522
3,522
3,636
-19,656
-15.0118
50,108
5,731",l1li
.,.,
SECTION A--THE EXPENDITURE ACCOUNT--Continued
C lasslficaUon of
EXPENDITURE!'! - -C ontinup.d
Treasury Department--Continued
Bureau of Accounts:
Salaries and expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Claims, judgments and relief acts.. ... .... ..... . .. ..
Interest on uninvested funds. . . . . . . . . . . . . . . . . • . . . . . . .
Government losses in shipment. . • . . . . . . . . . . • . . . . . . . .
Other ..................... '" . ...•. ....•....•.... .
Bureau of Customs:
Salaries and expenses ..............................
Intragovernmental funds (net) ...........•...........
Other ......................... " ... .. . ....... .. . ..
Bureau of Engraving and Printing:
Intragovernmental funds (net) .......................
Other ........................................... , .
Bureau of the Mint:
Salaries and expenses ....... " . .. .•... ... ..... .•...
Other.............................................
Bureau of Narcotics..................................
Bureau of the Public Debt.............................
Internal Revenue Service:
Salaries and expenses... . ..................... .. ...
Revenue accounting and processing..................
Compliance ..............................••.......
Interest on refunds of taxes.. .. .. . ... . .. . .. .... .•. ..
Payments to Puerto Rico for taxes collected..... .. ...
Federal tax Uen revolving fund.. .. .. .. . .. . .. . .. .. .. .
Office of the Comptroller of the Currency...............
Office of the Treasurer:
Salaries and expenses..............................
Check forgery insurance fund.......................
U.S. Secret Service..................................
This Month
Expenditures
(Disbursements)
CUrrent Fiscal Year to Date
AppUcable
Receipts
Comparable Period Prior Flscal Ysar
Expenditures Applicable \
Net
(Disbursements) Receipts Expenditures
Expenditures
(Disbursements)
Net
Expenditures
$3,065
620
137
131
383
$3,065
620
137
131
383
$45,243
62,275
7,254
330
393
$45,243
62,275
7,254
330
393
$37,647
58,490
9,633
155
21
137,647
58,490
9,633
155
21
7,446
313
4,360
98,630
98,630
92,590
92,590
-629...........
72
...........
7,446
313
4.: 160
'
-629
72
1,142... ........
473
...........
..............
...........
4,012
...........
1,862
...........
15,359
...........
42,964...........
8,876...........
10,212...... .....
..............
...........
2,141
$263
707
40
1,909
Interest on the public debt (accrual basis):
Public issues.. .. ..... .. ... ... ..... ......... ..... ..
Special issues .................................... ,
...........
...........
...........
-7
403
1,261...........
800...........
1,261
800
1,142
473
...........
4,012
14,216... ........
7,006 ...........
.............
...........
57,406 ...........
14,216
7,006
............
57,406
16,182...........
13,067
...........
5,132
...........
57,574
...........
16,182
13,067
5,132
57,574
1,862
15,359
42,964
8,876
10,212
...........
1,878
21,239...........
187,330 ...........
537,239...........
119,726.... .......
80,238 ...........
14
$15
25,785
27,684
21,239
187,330
537,239
119,726
80,238
-1
-1,899
20,280..... ......
178,174
...........
497,326...........
120,288...........
66,160...........
9
S6
22,161
25,039
20,280
178,174
497 ,326
120,288
66,160
3
-2,877
...........
42
...........
707
-1
1,909
1,203,539...........
289,563
...........
1,493,103.. .........
-7
403
7,065
447
23,704
...........
450
...........
7,065
-3
23,704
1,203,539
289,563
13,985,920.... .......
2,627,018 ...........
1,493,103
16,612,938.... .......
6,566
772
18,459
...........
771
...........
6,566
18,459
13,985,920
2,627,018
12,263,245...........
2,309,763
...........
12,263,245
2,309,763
16,612,938
14,573,008...........
14,573,008
-269.391..............
439,291
-702,795
-719,807.. .........
-439,291
-719,607
(*)
~-
Total--Interest on the public debt.................
Proprietary receipts from the public..................
Intrabudgetary transactions............... ............
......... .....
-66,517
19,072
...........
Total--Treasury Department. . . . . .. . . . . . .. . .. .. . . .
1,532,890
19,377
1,513,513
17,259,0.18
297,540
16,961,47.8
II.tomic Energy Commission ....... ,.....................
248,343
(*)
248,343
2,451,100
760
2,450,340
2,467,045
General Services Administration:
Real property actiVities:
Construction, public buildings projects .............•
Repair and improvement of public buildings .......... .
Intragovernmental funds (net) .......•••.............
Other .........................•............•......
Personal property activities:
Intragovernmental funds (net) ...................... .
Other ............................................ .
Records activities:
National Archives trust fund ...............•.......
Other ........................................•.•.
Transportation and communications activities .......... .
Property management and disposal activities:
Public enterprise funds .•....•.....•••••....•....•
Intragovernmental funds (net) •.......•••••.•.....•.•
Other .......................................•.•..
5,805
-19,072..............
-66,517
-702,795
269,391
...........
15,119,707.465,108
1,194
14,654,600
2,465,851
4,309
39,795
5,232
4,309
39,795
5,232
5,805
68,158
73,208
-10,785
314,900
68,158
73,208
-10,785
314,900
115,872
74,164
4,981
296,476
115,872
74,164
4,981
296,476
48,061
4,187
48,061
4,187
35,395
76,202
35,395
76,202
-10,666
68,790
-10,666
68,790
-74
1,507
7,455
1,605
20,714
5,681
1,325
480
20,714
5,681
912
18,441
11,617
15
-15
302
27,103
-2
-423
29,179
143
1,507
7,455
216
(*)
271
2,000
(*)
271
2,000
302
27,103
1,004
-92
18,441
11,617
-2
-423
29,179
en
0-
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (II, thousands)
SECTION A--THE EXPENDITURE ACCOUNT··Contil·ued
Current Fiscal 'ear to Date
This Month
Classification of
EXPENDITURES - -Continued
Expenditures
(Disbursements)
Applicable
Receipts
Expenditures
Net
Expenditures (Disbursements)
Comparable Period Prior Fiscal Year
I
Applinble
Net
Receil'ts Expenditures
Expenditures
(Disbursements)
Applicable
Receipts
Net
Expenditures
_.
General Services Admimstration--Continued
General activities:
Surplus real property credit sales ................ .
Public enterprise funds .......................... .
Intragovernmental funds (net) .................... .
Other ••••••••••••••••••••••••••••••••••••••••••
Proprietary receipts from the public ••••••••••••••••
I
902
287
............
............
............
............
..........
$19,802·
902
287
-19,802
Total--General Services Administration
112,240
20,018
National Aeronautics and Space Administration
326,611
513,657
117,296
Veterans Administration:
Compensation, pensions, and benefit programs ...... .
Medical care ..................................... .
Public enterprise funds:
Direct loan revolving fund ....................... .
Loan guaranty revolving fund .................... .
Other .......................................... .
Benefits, refunds and dividends:
Government life Insurance fWld •••••••••••••••••••
National service life Insurance fWld ••••••••••••••••
Other ••••••••••••••••••••••••••••••••••••••••••••••
Proprietary receipts from the public:
Government life Insurance fWld ••••••••••••••••••..
National service life Insurance fund ••••••••••••••••
Other ••••••••••••••••••••••••••••••••••••••••••••
Intrabudgetary transactions:
Payments to veterans life Insurance fWlds:
Government life Insurance fWld ••••••••••••••••••
National service life Insurance fWld ••••••••••••••
Total--Vetprans Administration ............ .
Other independent agencies:
Administrative Conference of the United States ........ .
American Battle Monuments Commission ............. .
Arms Control and Disarmament Agency .............. .
Central Intelligence Agency--construction ............ .
Civil Aeronautics Board:
Payments to air carriers ......................... .
Salaries and expenses •••••••••••••••••••••••••••••
Proprietary receipt from the public ••••••••••••••••
Civil Service Commission:
Payment to civil service retirement and disability
fund .......................................... .
Government payment for annuitants, employees
health benefits .........•.•••.•..•.•.....••......
Civil service retirement and disability fund ...•......
Employees health benefits fund .................... .
Employees life Insurance fund .......•..............
Retired employees health benefits fund ............. .
Other ........................................... .
Proprietary receipts from the publ\c •......•........
Intrabudgetary transactions:
Civil Service retirement and disability fund:
Receipts transferred from Foreign service
retirement and disability fund ........... .
Total- -Clv\l Service Commisslon . . . . . . . . . .
I
-$7,714
-$7,714
-$30,418
...........
119
...........
...........
175,037
-$22,579
-19
-693
1,897
-175,037
176,061
411,907
3,105
4,7:11,678
...........
...........
5,077,907
1,360,796
93,238
95,097
299,757
104,091
119,282
364,698
-10,852
-24,165
-64,942
71,857
500,351
299,295
...........
...........
...........
71,857
500,351
299,295
...........
15,739
476,472
1,771
-15,739
-476,472
-1,771
-50
-5,840
-77
-5,287
............
..........
-77
-5,287
7,415,922
7,792,933
1,082,033
6,710,900
19
2,182
10,739
41
...........
..........
238
2,348
9,597
58
131
43,924
9,839
-131
54,999
9,074
..........
72,000
71,000
40,748
2,405,960
-17,789
-151,569
1,223
39,476
-31,253
40,748
2,138,767
659,323
239,043
16,521
38,334
..........
-$30,418
-$22,579
...........
-339
2,748
..........
..........
..........
$160,877
-339
2,748
-160,877
...........
92,222
584,674
162,217
422,457
587,968
94
326,517
4,252,653
6,106
4,246,547
4,723,783
............
............
513,657
117,296
5,593,777
1,450,056
..........
5,593,777
1,450,056
5,077,907
1,360,796
10,493
4,774
32,143
9,608
12,068
51,374
886
-7,294
-19,231
108,601
114,639
301,128
131,598
374,903
-7,895
-16,959
-73,775
5,579
38,917
24,615
............
............
............
5,579
38,917
24,615
77,848
567,933
321,650
............
.........
.........
77,848
567,933
321,650
..........
..........
..........
1,103
40,964
170
-1,103
-40,964
-170
...........
...........
...........
10,967
477,990
1,865
-10,967
-477 ,990
-1,865
-20
-602
............
............
-602
-50
-5,840
.........
...........
746,852
115,287
631,565
8,529,741
1,113,818
..........
..........
24
............
-:II
24
346
758
...........
...........
758
.........
............
..........
238
2,350
9,598
58
3,274
751
............
3,274
751
-8
...........
............
............
72,000
............
............
..........
206,763
346
.........
..........
.........
206,763
53,915
-29,381
1,262
3,754
....•.•..
(*)
(*)
............
8
62,866
28,657
426
...............
7,405
-636
.............
23&,8Tl
ee,. .
-8,951
-58,038
837
3,754
-7,405
-838
:us._
43,924
9,839
40,748
2,405,960
746,618
241,889
15,030
39,476
...••..•.•.
-10,2Ot
1 ••1 ....
... ~~~:~~~ I
..........
2
1
...........
.........
..........
..........
784,406
8393,458
13,807
..........
31,253
...••.....
1._."
. ..........
-693
1,897
I
I
............
..........
I
•••••••••••
..•...•...•
13
(*)
I
...........
............
.•........
82
...........
..........•
..........•
685,823
272,617
17,769
...........
3,1180
19
2,169
10,739
41
54,999
9,074
-82
71,000
40,748
2,138,767
-28,501
-33,575
-I,at8
38,334
-3,_
-10,201
-'108
.........•.
-'IDe
1 ..... 1181
1.101.010
1mt.1I8O
2.2D.S.
SECTION A--THE EXPENDITURE ACCOUNT--Continued
This Month
Classification of
EXPENDITURES - -Continued
267
••••••.•••.•••
• .••. .•.••..•.
•••. ..........
•••••••••••..•
.•••••••• ..••.
•••.•••••••••.
Total--Farm Credit Administration...............
267
Total--Railroad Retirement Board............
Comparable Period Prior Fmc&! Year
Net
Expenditures
Other independent agencies - -Continued
District of Columbia federal payment..................
Equal Employment Opportunity Commission............
Export-Import Bank of The United States...............
Farm Credit Administration:
Revolving fund for administrative expenses...........
Short-term credit investment fund. ••• •. .••• • • •• ••. ••
Banks for Cooperatives investment fund..............
Banks for Cooperatives fund........................
Federal Intermediate Credit Banks fund .....••. ~....
Proprietary receipts from the public................
Intrabudgetary transactions .......................
Federal Coal Mine Safety Board of Review •..••••.••••.
Federal Communicat.ions Commission;
International telecommunications settlements.........
Other.. .•.•.•.•••..•.•••...•.•.••••••••••.•••••..•
Federal Deposit Insurance Corporation....... •••.• •••••
Federal Field Committee for Development
Planning in Alaska. • • . • . • • • • • . • • • • • • • . • • . . • . . • • . . . •
Federal Home Loan Bank Board:
Federal Savings and Loan Insurance Corp. fund.......
Other. . . ••• . . . . . • .• . . •.. . . . •. • . . ••.•• . ••••. . . •••••
Federal Maritime Commission. • . • . . . . • • . • . . . • • . . • . • • •
Federal Mediation and Conciliation Service. • . . . . • . • . . . •
Federal Power Commission...........................
Federal Radiation Council. . • • • . . . • . • • • • . • • . • • . . . . • • • •
Federal Trade Commission. . . • . . . . . . . . . . . . . . . . . . . . . . .
Foreign Claims Settlement Commission. . • . • • • • . . . . • • • •
Historical and Memorial Commissions ....•..•.•...•.•
Indian Claims Commission ....••.....................
Interagency Committee on Mexican-American Affairs... .
Intergovernmental agencies:
Advisory Commission on Intergovernmental Relations.
Appalachian Regional Commission;
Salaries expenses, and other ..••••..•••••...•••••
Intrabudgetary transactions
.••••••••••• " ••••••
Commission On status of Puerto Rico •.......••.•..•.
Delaware River Basin Commission ................. .
Interstate Commission on the Potomac River Basin •••
Washington Metropolitan Area Transit Authority .•••..
Interstate Commerce Commission .••••••••••••••••••••
National Capital Planning Commission ...•••••••.•.••••
National Capital Transportation Agency ...•••••••••....
National Council on Indian Opportunity .........•.......
National Foundation on Arts and Humanities ........... .
National Labor Relations Board ...................... .
National Mediation Board .•.•••..•••••.•••.•••••.••••
National Science Foundation .............•............
President's Committee on Consumer Interests ....... , ..
President's Council on Youth Opportunity ......•..•....
Hallroad Retirement Board:
Payment for military service credits •.....•..•.•....
Railroad retirement accounts:
Administrative expenses ..•..............••.••..•
Benefit payments, etc ...•••......•.......•.....•.
Interest on refunds of taxes ............•.•........
Payment to railroad unemployment ins. account •••.•
Proprietary receipts from the public •...•••.•...•••..
Intrabudgetary transactions:
Railroad retirement accounts:
Payments for military service credits .........•..
Receipts transferred to railroad unemployment
insura.n.ce aCcoWlt ............ .................. .
Current Fiscal Year to Date
$275............
759
•••••..•••••
18,279
$88,968
,.t
$768'~i
$281,369
-117,489
3,251
200
3,000
-12,973
-32,696
•.•. .•• .•• ...•
-4,814
3,217
••••••••• •••
10,254
••••••••••••
••••••••••••
2
••••••••••••
34
7 ~
12' 973
::S2' 696
,
1~
-4,8
-44,032
13,473
-57,504
$275
759
-70,689
$89,178
8,616
212,710
•••.••••••••
$1
323,528
$89,178
8,616
-110,818
$78,853
6,202
163,880
940
-673
••.•.•.•••••.•••••••••••
.•.••... •••• ... •••••. •••
••••••..•••. ••••••••••••
•••.•••••••• ••••••••••••
. ••••.• .•.•• • .•..• ..•.•.
•••••••••••• ••••••••••••
3,529
..............
•.•.•. .•..•...
-2,285
-53,868
•••••.•••• .•..
-5,995
3,671
64,388
28,324
............
••••••••••••
43,840
••••••••••••
-142
-64,388
_28,324
-2,285
-53,868
-43,840
-5,995
-673
-58,619
140,222
-198,841
940
•••••••••
\*)
,
8
• • • • • •• • • • ••
105
• • •• •• •• • •• •
105
97
• •• • • • • • • •• •
97
••••••••••••••
1,740
3484
"
-8
••••••• •••••
1
1373
••••••••••••
1,739
2,110
••••••• •••••••
20,278
18,163
.•••••••••••
17
332,528
•••• •••••••••
20,261
-314,366
797
18,653
37,799
517
83
297,458
281
18,569
-259,859
• • ••• •• • ••. •
-8
187
••• • • • • . • • . •
187
242
• • •• • • • • . •• .
242
-1,279
1,444
279
608
1,241
38
1,258
56
46
51
3
108,216
1,953
26
-109,495
-509
253
608
3,601
38
1,258
56
46
51
3
-9,967
18,841
3,700
8,022
15,680
136
16,402
831
96
628
-69
295,669
19,643
71
-305,836
-602
3,629
8,022
15,666
136
16,398
831
96
628
-69
126,325
23,177
3,576
7,336
14,576
97
15,221
1,308
29
446
-37
386,964
17,738
10
-260,640
5,439
3,585
7,336
14,563
97
15,215
1,307
-18
245
-18
245
471
2,225
471
1,730
503
2,154
..................
···········2
-1,101
-1,101
-662
(*)
(*)
191
191
179
5
5
5
179
5
1,626
23,611
760
1,871
-62
12,603
31,842
2,014
445,086
355
-162
H
-2,560
............
(*)
(*)
2
···········835
1,951
97
.............
1,160
2,756
179
48,099
1
19
7
835
1,945
97
·········i:i ...........
1,160
2
-16
2,754
179
48,115
1
19
946
129,089
946
129,089
(*)
(*)
1
-1
.. ·····2;8201
1
-2,820
-1
H
13
··········4
(*)
········i:;
495
H
6,105
24,594
1,163
7
-4
11,520
34,312
2,187
490,192
16
154
H
...........
6,105
24,532
1,070
........... .
7
62
92
3
26
.. ····2;is2
-4
11,517
34,286
2,187
488,010
16
154
1,626
23,690
872
1,871
-62
12,608
31,863
2,014
448,593
355
-162
<*)
13
. ........ '·6
1
29
446
-37
502
1,492
(*)
662
-662
79
111
5
20
(*)
3,506
18,446
18,446
17,839
17,839
14,695
1,532,790
6
14,695
1,532,79~i
13,800
1,387,711
13
13,800
1,387,711
13
1
...........
6,791
1
-6,791
-18,446
-18,446
-1
-Ii
.......... .
4,050
-17,839
1,401,525
. .......
~4;050
-17,839
1,397,475
....
.....
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
E XPE NDITURES- - Continued
t239
1,481
5,302
17,003
-46
Applicable
Receipts
("l
(oo
$1
8,569
Comparable Pericd Prior Fiscal Year
Current Fiscal Year to Date
This Month
E xpenditur es
(Disbursements)
00
Net
EXPenditures:)1
Expenditures (Disbursements)
t239
1,480
5,301
$2,983
18,550
64,801
8,434
-46
230,654
9,447
Expenditures
Net
Applicable
Receipts Expenditures (Disbursements)
'*1
!t3
10
110,326
............
AppUcable
Receipts
Net
Expenditures
~2 983
18,546
64,791
~2,640
(.) I
17,642
56,767
2
120,328
9,447
228,118
10,084
-21
l~:~!
. ...........
98,530
10,084
-21
-3
129,591 i
108,589
.. 2'mli
41,470
248
3,694
2,304
8,654
~3
............
....... ....
............
.............
............
(oo)
.............
. ..........
(oo)
13
-13
..............
8,569
8,388
240,101
110,339
129,762
238,181
3
54,048
270
3,847
2,534
8,345
2,569
............
............
............
4,288
26
308
220
1,162
. ..........
. ..........
. ..........
51,479
270
3,847
2,534
8,345
43,774
248
3,694
2,304
8,655
..............
67,820
36,462
5
31,358
-5
. ............
591,635
404,548
85
187,086
-85
. .............
537,315
400, 491
87
67,820
36,467
31,353
591,635
404,634
187,001
537,315
400,578
..............
..............
16,957
4,291
26
308
220
1,162
(oo)
(oo)
3
(iI)
~2,640
17,639
56,765
1
136,824
-87
i
136,737
I
..............
15,819
1,339
883
............
............
.............
............
. ...........
37
170,988
7,776
4,578
. ..........
...........
...........
614
4
170,988
7,776
4,578
-614
. .............
183,379
648
182,732
55
-51
...........
55
15,819
1,339
883
-55
.............
18,040
55
17,985
55
............
.............
223
(*)
33
791
166,038
16,362
4,949
1,064 I
............
. ...........
............
759
-273
166,038
16,362
4,949
-759
188,140
1,823
186,317
-51
-91
. ...........
-91
.............
. ...........
............
223
4,035
-252
...........
530
3,505
-252
2,916
-329
. ...........
316
2,600
-329
571,068
346,190
224,878
7,258,887
2,843,140
4,415,747
6,766,119
2,520,671
4,245,448
-52
............
............
............
............
............
-52
-502
-502
-451
-469,000
-63,000
-79,000
-469,000
-63,000
-79,000
-397,000
-48,000
-65,000
-472
-5,379
-5,379
-4,449
............
............
............
............
............
-451
-46,000
-7,000
-9,000
...........
...........
...........
...........
...........
-97,803
-1,473,734
-1,473,734
-1,380,715
...........
-2D
-2D
-2D
-160,326
............
.............
-2,090,635
-2,090,635
-1,895,635
.............
U
-46,000
-7,000
-9,000
-472
-97,803
.............
-160 326
............
. ...........
............
...........
...........
...........
-397,000
-48,000
-65,000
-4,449
-1,380,715
-20
-1,885.881
SI!CTION A--THE EXPENDITURE ACCOUNT--Continued
Classification of
Expenditures
(Disbursements)
EXPENDITURES-- Continued
Undistributed intrabudgetary transactions __
Continued
Interest credited to certain Government accounts:
The Judiciary:
Judicial survivors annuity fund ••..••..••••••••••••
Defense Department:
Civil:
Soldiers' Home permanent fund •••••••••••••••••
Health, Education, and Welfare Department:
Federal old-age and survivors insurance trust fund ..
Federal disability insurance trust fund ••••••••••••.
Federal hospital insurance trust fund ••••••••••••••
Federal supplementary medical insurance trust fund.
Interior Department:
Indian Tribal Funds ..............................
Labor Department:
Unemployment trust fund .........................
State Department:
Foreign service retirement and disability fund ••••••
Transportation Department:
Highway trust fund ...............................
Veterans Administration:
Government life insurance fund ••••••••••••••••••••
National service life insurance fund ••••••••••••••••
Civil Service Commission:
Civil service retirement and disability fund .........
Railroad Retirement Board:
Railroad retirement accounts •..••••••••••••••••••
Other ............................................
Current Fiscal Year to Date
This Month
Applicable
Net
Applicable
Net
Expenditures
Expenditures (Disbursements) , Receipts Expenditures
Receipts
-$4
............
-$4
.............
............
-403, BOO
-57,177
-38,204
-7,029
............
............
............
............
-$171
. .........
. ..........
-3,233
..........
-403,806
-57,177
-38,204
-7,029
-1,008,949
-139,587
-93,581
-23,466
..........
..........
. .........
-S143
-$143
..........
-3,233
-3,195
. .........
-3,195
-1,008,949
-139,587
-93,581
-23,466
-894,436
-83,015
-60,659
-20,677
. .........
..........
-B94,436
-83,015
-60,659
-20,677
-$171
..........
Comparable Period Prior Fiscal Year
Expenditures
Applicable
Net
(Disbursements)
Receipts
Expenditures
. .........
..........
-56
-5,393
. .........
-5,393
-6,921
..........
-6,921
-200,102
-516,637
. .........
-516,637
-439,305
..........
-439,305
-321
............
............
............
-321
-1,765
. .........
-1,765
-1,674
..........
-1,674
-18,481
............
-18,481
-52,654
. .........
-52,654
-33,503
..........
-33,503
-30,933
-197,590
............
............
-30,933
-197,590
-31,902
-224,539
. .........
-31,902
-224,539
-32,347
-210,752
..........
..........
-32,347
-210,752
-650,682
............
-650,682
-805,292
-805,292
-705,788
-131,106
-113
-191,168
-511
-181,351
-568
-1,735,602
-3,098,850
..........
. .........
-191,168
-511
..........
..........
. .........
-705,788
-131,106
-113
-3,098,850
-2,674,334
..........
-2,674,334
-1,B95,929
-5,189,465
..........
-5,189,465
-4,569,970
. .........
-4,569,970
14,104,990
206,778, 620
$23,489,943
183,288,677
194,032,346
$21, 228,989
-56
-200,102
Subtotal ......................................
-1,735,602
............
............
............
Total- -Undistributed intrabudgetary transactions ..
-1,895,929
............
Total expenditures (excluding net lending)•••••••••
17,113,872
$3,008,882
The expenditure account surplus (+) or deficit (-)
+9,750,360
" - - -
--
--
. .........
. .........
..........
---
+4,553,977
-181,351
-568
172,803,357
-19,131,935
-"
MEMORANDUM
Receipts offset against expenditures (In thousands)
Current
Fiscal Year
to Date
Comparable Period
Prior Fiscal Year
Proprietary receipts •.•••....••••..•..• , .•• " •••••••
Intrabudgetary transactions ...•...••..........•.•...•
$3,910,613
8,691,177
M,396,330
6,8BU,30B
Total receipts offset against expenditures •••••••••••
12,601,789
11,276,638
..0
~
o
TABLE III--BUDGET RECEIPTS AND OUTLAYS--Continued (In thousands)
SECTION B--THE LOAN ACCOUNT
Classification
Funds appropriated to the President:
Economic opportunity loans .......................... .
Defense production act .............................. .
Total- - Funds appropriated to the President
Agriculture Department:
Commodity Credit Corporation:
Storage facility and short-term export sales credits ...
Farmers Home Administration:
Agriculture credit Insurance ....................... .
Direct loans ..................................... .
Emergency credit ................................. .
Rural housing direct loans ........................ .
Rural housing insurance ........................... .
State rural rehabilitation .......................... .
Rural Electrification Administration .................. .
Total--Agriculture Department .................... .
Loan
Dlsbursements
~
1
I Repayments
Loan
Comparable Period Prior Fiscal Year
Current Fiscal Year to Date
This Month
Net
Lending
Loan
Disbursements
Loan
Repayments
Loan
Disbursements
Net
Lending
Net
Lending
Loan
Repayments
r
~1,45O
2
$613
2
!l837
...........
!t12,132
2
UO,755
2,261
tl,377
-2,259
$27,038
15
1,453
616
837
12,135
13,016
-882
27,053
12,341
13,125
-784
220,067
133,611
86,456
194,755
114,868
79,887
47,661 i
18,692!
4, 99°1
1,017
67,885
123 1
40,433
45,011
16,171
3,146
7,140
70,042
151
15,204
2,650
2,521
1,844
-6,123
-2,158
-28
25,230
520,395
353,896
113,891
11,603
584,695
979
472,959
406,706
285,214
99,717
43,697
491,791
1,768
172,193
113,689
68,682
14,174
-32,094
92,904
-789
300,766
488,878
376,183
105,149
14,151
589,796
-630
495,000
473,958'
291,190
89,883,
48,132
527,179,
1,550'
204,335,
14,920
84,993
15,267
-33,981
62,616
-2,180
290,665
169,989
23,153
2,278,484
1,634,698
643,787
2,263,282
i
193,142
~10,232
1,684
!16,806
-1,669
11,916.
-
15,136
__ :-=-..:.......=:----::.-=----=:t=::::--------::-:-::---
1,751,095
512,187
1
Commerce Department:
Economic Development Administration:
Economic development ...........................•.
Maritime Administration:
Federal ship mortgage insurance .........••.•••.....
Other ........................................... .
4,814
Total--Commerce Department ..........•.........
4,814
47,986
8,375
39,611
480
351
-480
-351
909
...............
1,944
6,442
-1,035
-6,442
4,814
831
3,983
48,896
16,762
')l·fense Department:
Military:
Defense production guarantees ..................... .
Homeowners assistance mortgages .................. .
Civil:
Construction of power systems, Ryukyu Islands ...... .
658
644
14
4,932
7,093
-2,161
Total- - Defense Department ..................... .
658
644
14
4,932
7,093
-2,161
Health, Education, and Welfare Department:
Office of Education:
Higher education activities ......................... .
Student loans ..................................... .
Other ............................................ .
Public Health Service ............................... .
Social Security Administration ....................... .
Other .............................................. .
9,591
43
30
171
9,420
(*)
105
43
-74
88,816
187
5,775
2,944
158
1,217
93
85,871
29
4,558
-93
485
126
360
5,162
425
Total--Health, Education, and Welfare Department •.
10,150
402
9,749
99,940
4,837
95,103
16,376
7,117
34,455
16,789
1,032
115
52,331
37,334
15,344
7,002
-17,876
-20,545
197,384
80,880
286,457
343,519
48,735
1,451
273,674
275,885
148,649
79,429
12,782
67,635
4,622
496
4,126
-26
......
Housing and Urban Development Department:
Renewal and housing assistance:
College housing loans ............................. .
Housing for the elderly ............................ .
Low-rent pubUc housing •••••••••••••••••••••••••••
~her
••••••••••••••••••••••••••••••••••••••••••••
Metropolitan development:
Urban mass transportation •••••••••••••••••••••••••
PubUc faclUty loans .............................. .
F~~~d~~~~O~~t;~o~;······················
ltaDdernlaatlon. improvement and Dlortgage insurance..
I
59,450
I
9, 383
1
50,067
1,467!
7,5691
-4,562
-7,569
18,419 i
37,936
14,158
-8,231
6,357
14,158
-7,801
104,784
3,583
101, :~11
-909
91
253,000
355
3,092
-91
-203,000
3,136
160,459
256,119
-95,660
310,480
82,108
181,218
298,510
35,221
854
170,943
322,563
275,259
81,254
10,275
-24,054
44,163
48,2'78
3,854
..061
l1li7 .1N1
-3,095
I ........... "._
32,1341
56,355
.........
~:~~
r
i
i
430
7,270
26
l.lIOO
5."'"
50,098
'1
5,935
424
2711 ....
I
. ..... 4;7371
2
2,183
..............
50,000
3,491 I
...........
-418
430
2
200
528.~
....
-200
.,424
118.148
SECTION B--THE LOAN ACCOUNT--Continued
Loan
Disbursements
I Repayments
Loan
Comparable Period Prior FlScal year
Current Fiscal Year to Date
This Month
Classification
Net
Lending
Net
Lending
Loan
Disbursements
I Repayments
Loan
Net
Lending
Loan
Disbursements
Loan
Repayments
$151,408
80,263
317,052
105,143
1,651,590
$114,354
441,550
-292,960
176,856
$500,003
634,667
284,530
2,216,899
!li136 ,080
62,976
170,742
279,083
$363,923
571,691
113,788
1,937,815
Housing and Urban Development Department--Continued
Government National Mortgage Association:
Management and liquidating functions .............. .
Special assistance functions ....................... .
Participation sales fund .......................... .
Secondary market functions ....................... .
Loans to Federal National Mortgage Association ....... .
$1,322
68,772
$14,417
10,465
70,722
-$13,096
58,306
-70,722
66,690
245,190
-178,500
$265,762
521,813
24,092
281,999
1,651,590
Total--Housing and Urban Development Department. ..
223,412
433,479
-210,067
4,004,508
3,186,507
818,001
5,146,586
1,712,712
3,433,875
Interior Department:
Bureau of Reclamation ............................ .
Other ............................................. .
609
1,826
110
345
499
1,481
5,435
16,479
1,261
3,325
4,174
13,154
14,688
7,579
1,253
3,239
13,435
4,341
2,435
455
1,979
21,913
4,586
17,328
22,267
4,492
17,776
50,000
164,000
-114,000
-100
-185
7,067
22,579
70
21,944
-70
635
Total--Interior Department ...................... .
Labor Department .................................. .
Transportation Department ........................... .
Treasury Department ................................ .
General Services Administration ...................... .
7,714
134
2,673
-134
5,041
30,418
100
185
23,351
Veterans Administration:
Direct loan program ...............................
Loan guaranty program ............................
Government life insurance fund ......................
National service life insurance ......................
Other .............................................
.
.
.
.
.
8,793
15,113
1,096
13,840
1,007
8,232
4,097
967
5,832
259
561
11,015
129
8,008
748
145,304
193,634
9,015
131,213
9,980
97,573
51,412
10,838
72,571
3,031
47,732
142,222
-1,822
58,642
6,949
147,961
239,814
8,675
165,611
7,579
95,284
35,018
94,385
195,035
2,387
52,678
204,795
-85,710
-29,424
5,192
Total--Veterans Administration ................... .
39,849
19,388
20,461
489,147
235,424
253,723
569,640
422,109
147,531
Other independent agencies:
Civil Service Commission .......................... .
Loans to District of Columbia ....................... .
Export-Import Bank of the United States ............. .
8,425
242,760
200,000
-2
226,597
-200,000
8,427
16,163
107,781
1,658,988
594,600
43,025
1,301,867
-594,600
64,756
357,121
594,600
60,231
1,646,465
114,000
38,789
739,203
480,600
21,442
907 ,262
Farm Credit Administration:
Banks for Cooperatives ........................... .
Federal Intermediate Credit Banks ................. .
999,678
2,929,862
879,112
3,209,302
120,566
-279,440
1,826,882
7,413,310
1,665,593
7,007,710
161,289
405,600
Total--Farm Credit Administration .............. .
3,929,540
4,088,414
-158,874
9,240,192
8,673,303
566,889
17,381
-1,001
-23
-50,000
-18,585
4,707
50,000
406,295
9,257
570
201
114,000
230,548
-4,550
-570
-201
-64,000
175,747
1,479,989
20,327,068
14,296,905
6,030,164
Federal Home Loan Bank Board:
Federal Savings and Loan Insurance Corporation ....
Interstate Commerce Commission ...................
National Capital Planning Commission ...............
Railroad Retirement Board .........................
Small Business Administration ......................
.
.
.
.
.
Total--Loan Account ............................. .
TOTAL BUDGET
-2,097
8
5,399
-8
29,072
17,048
50,000
21,149
-50,000
-4,101
215,061
11,691
1,001
23
50,000
233,646
755,162
1,124,266
-369,104
12,930,814
11,450,825
3,302
(Net Totals)
(Net Totals)
Receipts (+) (The expenditure account) •......•....•...•.
+23,855,350
+187,842,654
(Net Totals)
+153,671,422
Expenditures (-) (The expenditure account) •.............
-14,104,990
-183,288,677
-172,803,357
Net Lending (+) or (-) (The loan account) •••.•....•......
+369,104
-1,479,989
-6,030,164
Total outlays .................................. .
-13,735,886
-184,768,666
-178,833,521
Budget surplus (+) or deficit (-) ....................... .
+10,119,464
+3,073,988
-25,162,099
"-l
22
TABLE IV--MEANS OF FINANCING (In thousands)
Net Transactions
[( -) denotes net reduction of either
liability or asset accounts J
Classification
Account Balances
Current Fiscal Year
Beginning of
Fiscal Year to Date
(Assets and Liabilities
Directly Related to the Budget)
This Month
This Year
This Year
Prior Year
CI06e cI
This Month
This MOIl
-
LIABll..ITY ACCOUNTS
Borrowing from the public:
Federal securities:
Public debt securities ••••••••.•..•.............•..•
Agency securities:
Defense Department:
Family housing mortgages ......................
Homeowners assistance mortgages ..............
Housing and Urban Development Department:
Federal Housing Administration •................
Government National Mor~age Association:
ParticipatIOn sales fund.
Participation certificates .•...•.......•.•.••
Secondary market operations ................ .
Transportation Department:
Coast Guard:
Family housing mortgages ••...•..•...........
Treasury Department:
Federal Farm Mortgage Corp. liquidation fund •..
Other independent agencies:
Export-Import Bank of the United States:
Agency secur ities ............................
Participation certificates •.••••.•••••.••.•••.•
Farm Credit Administration:
Banks for Cooperatives fund •••...•.•..•••••••
Federal Intermediate Credit Banks fund •••••••
Federal Home Loan Bank Board:
Federal Home Loan Bank Board revolving fund ••
Home Owners' Loan Corporation fund •••••...••
Tennessee Valley Authority •••..•.••••••••.•....
I
I
I
I
-$6,344,584
~6,141,847
I
$21,357,469
$347,578,406
i
I
I
$360,064,837
1353,'11)
1,873,423
5,387
1,1IIM
578,459
5'11
7,900,000
5,887,062
8,670,000
8,a
2,961
I
-9,044
715
i
-87,062 !
6,090
-84,150
12 '
1,951,441
12 :
548,427
-1,563
28,469
56,404 :
-70,000
700,000
-5,887,062
3,070,000 :
1,807,959 '
I
I
..............
,
•
-126
-121
3,087
-2
-11
109
j
107
,I
387,465
2,183,068
787,525
1,858,953
-129,380
-45,000
270,680
-369,115
387,465
19,452
.............
-1,229,515
-3,778,580
157,888
416,005
592
5,433
-3
107,800
5,433
260
525,000
5,259
:148
655,000
m
.............
i
1,229,515
3,778,580
i
iii
1,813
.............. ............
.............. ............
72,655
418
-13
202,655
Total agency securities ••••••••.•...•....•••
-181,025
-10,143,163
5,944,133
24,399,459
14,437,322
14,251
Total Federal securities •••••....••.........
-6,525,609
-4,001,315
27,301,601
371,977,866
374,502,159
367,9'/8
79,137,448
85,605,140
87,858
2,209,000
825,000
825,
279,482,
(*1
Deduct:
Federal securities held as investments of
Government accounts (See Schedule B~ ...........
Non-interest bearing public debt securities
held by Inter national Monetary Fund .•..........•
Deposit funds
i
2,054,291
8,521,983
.............
-1,384,000
i
,
-8,579,900
,
.........................................
,
,
-78,516
I
I
139,772
I
I
-9,455,958
I
Total cash and monetary assets •..........
Miscellaneous asset accounts
..........................
I
-1,119,000 :
~-
---
330,669
,
I
I
---
23,100,476
290,631,418
288,072,019
295,307
1,735,048
2,715,654
1,778,
4,373,742
4,782,928
4,'/01,
833,982
!
I
ASSET ACCOUNTS (Deduct)
Cash and monetary assets:
Within general account of Treasurer, U.S. ............
With other Government officers .......................
With International Monetary Fund .....................
5,320,1251
,
-11,139,299
43,293
-937,314
I,
Miscellaneous liability accounts (includes checks
outstanding etc. ) ..................•..................
Total liability accounts ••.................
- --
:
Total borrowing from the public •..........
Accrued interest payable on public debt securities •........
-
5
-669,840
-11,435~17i
I
I
426,249
146,942
106,000
i
I
679,190
1,750,274
;
4,478,914
4,618,
302,028,734
300,049,515
290,593,
-1,064,932
1,858,361
538,000
6,694,062
3,662,581
965,750
6,677,289
4,212,188
1,504,000
7,103,
4,359,
1,610,
13,072,
-
--- --
--
I
409,476
696,549
644,250
,
37,189
t
5,288,526
26,294,943
2,065,178
!
!
I
-t
-
------
I
291,308
----
1,331,428
11,322,393
12,393,477
168,629
1,239,990
1,494,109
1,531,
I- ---
Total asset accounts .....................
716,379
2,041,582
1,500,058
12,562,383
13,887,586
14,603,
Excess of Liabilities (+) or Assets (-) ••••..•••.•••......
-10,172,337
-13,476,759
+24,794,885
+289,466,351
+286,161,929
.Z75,iI89,!
Add: Transactions not applied to current year' s
surplus or deficit •.•••••.••••..................
52,873
10,402,771
367,213
.............
10,349,898
10,402,
Total budget finanCing [Financing of deficit (+) or
disposition of surplus (-) J••••••••••••••••••••••••••••
-10,119,464
-3,073,988
+25,162,099
+289,466,351
.296,511,827
.286,392,
TABLE IV··SCHEDULE A··ANALYSIS OF' CHANGE IN EXCESS OF' LIABILITIES (In thousands)
Fiscal Year to Date
Classification
This Month
This Year
-
Prior Year
1
!Cess of liabilities beginninlf of per iod: .
.
.
)laSed on compositlOn of unified budget In preceding perIOd .•
Adjustments during ~urrent fiscal year for changes in
composition of unified budget:
Reclassified from deposit fund (liability) account to
budget account:
Proceeds of sales, personal property:
Agency for International Development •••...••••••.••
Defense Department ........•.....................
Other •••.•.•.•..•.•••••••••••••••••.••..•.....••.
Proceeds from sale of scrap, salvage or surplus
materials:
Defense Department •...........•.......••....•...
Reclassified from budget account to deposit fund
(liability) account:
State participation:
Appalachian Regional Commission ••..•.....••.....
Reclassified from budget transactIOns to cash and
monetary assets with other gover nment officer s:
Indian tribal funds· deposits with commercial
banKs ............. , .... , ......................... .
tess of liabilities beginning of period (current basis)
,
dget surplus (.) or deficit:
Based on composition of unified budget in pr ior fiscal year ••
Adjustments during current fiscal year for changes in
composition of unified budget:
Reclassified from depositfund transactions (non -budget)
to budget transactions:
Proceeds of sales, personal property:
Agency for International Development •.•............
Defense Department. ............................. .
Other ........................................... .
Proceeds from sale of scrap, salvage or surplus
materials:
Defense Department .•...•.................... , ....
Reclassified from budget transactions to deposit fund
transactions (non-budget):
State participation:
Appalachian Regional Commission •.................
Reclassified from budget transactions to cash and
monetary assets with other government officers:
Indian tribal funds - deposits with commercial
banks ............ " ............................. .
idget surplus (.) or deficit (Table ill)
lCeipts and expenditures not applied to surplus or deficit of
Ihe current year:
Seigniorage ..........................•...•.............
Conversion to private ownership of:
Banks for Cooperatives •...••...••.....•..............
Federal Intermediate Credit Banks •....................
Federal National Mortgage Association •..•....•........
$286,288,187 $289,643,973
$264,824,484
................
.........................
..............
-738
-10,256
-76
-394
362
-18, -55 1
...............
-40,378
-36,921
..............
84
77
-126 258
286,161,929
-126 258
289,466,351
-97 364
264,671,465
-10,078,728
-3,027,530
25,186,703
..............
-64
5,215
-910
5,087
-74
-344
8,106
-21
-7,107
-11,759
-3,457
-8
-30
7
-38,772
-38,772
-28,894
-10,119,464
-3,073,988
25,162,099
-10,413
-232,820
-367,213
..............
-42,460
.............
...........
..............
-1,278,571
-3,261,069
-5,630,311
Total. ...............•....•....•......•.•..........
-52,873
-10,402,771
-367,213
(cess of liabilities close of period •....•..................
275,989,592
275,989,592
289,466,351
.. ............
23
24
TABLE IV-SCHEDULE B--INVESTMENTS OF GOVERNMENT ACCOUNTS
IN FEDERAL SECURITIES (In thousands)
Net Purchases or Sales(-)
Classification
,~-
--
This Month :
The Judiciary:
Judicial survivors annuity fund. .••...................... ,
~
Beginning of
------~
This Year
, Prior Year
-$~
-$9
$52
152
246
593
549
4,132
-6,000
-200
-5,870
2,395
Agriculture Department
Public debt secur ities ................................. .
Agency securities ...•...........................•.....
Commerce Department •...•... '" ......•.....•...........
I!
Fiscal Year to Date
This Year
Legislative Branch:
Library of Congress •••••..............................
Securities Held as Investments
Current Fiscal Year
----,-______:~__;_::::--______:::-:--__It~~---:::--:--__:_____:_~____,-_
-2,086
Defense Department ...••.................................
163
4,479 1.
173
82,054
173
76,054
3,964
9,096
13,577
I
101
583
583
I
I
Clolie Q
This MOIl
This Month
-,
11,
I
1
Health, Education, and Welfare Department:
Federal old-age and survivors ins. trust fund:
Public debt securities ••••.•.••.•.•••.•••••••••••••••.
Agency securities ................................... I
Participation certificates •.•..•.••..•......•..........
Federal disability insurance trust fund:
'
Public debt secur ities •.••.......•...................
Agency securities ....•.........•.•.....•........•... '
PartiCipation certificates •....•....•..•......... , .....
Federal hospital insurance trust fund:
Public debt securities ................................ i
Agency securities ••••.............•.................
Participation certificates •••.••••...............•..•..
Federal supplementary medical ins. trust fund .......... .
Other ..........•.......•..••••.•...•.....•....•...•..
Housing and Urban Development Department:
Renewal and housing assistance:
Low-rent public housing program •..................... I
Metropolitan Development:
'
Agency securities ................................... .
Federal Housing Administration:
Federal Housing Administration fund:
Public debt securities ...•••••......................
Agency securities ...••...••........................
Participation certificates •..........................
Community disposal operations fund:
Public debt securities ...•..•.......•.•.......•..... I
Agency securities ...••..•........... . ..•.........
Government National Mortgage Association:
Participation sales fund:
Public debt securities .......•........•.•...........
Agency securities ......•........................... I
Management and liquidating functions fund:
Public debt secur ities ..................•••.........
Agency securities .•••••..................•.........
Special assistance functions fund:
Agency securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. ,
Federal Insurance Administration:
National Insurance Development fund ................. .
Interior Department:
Public debt securities •................................. :
Participation certificates ....•...........•.............. I
I
-80,724
105,766
1,380,784
-7,000
210,000
1,150,956
-30,000
515,855
10,000
85,000
!
I
67,117
631,176
-41,500
-4,953
~,ooo
22,743,265
96,500
410,000 '
25,588,842 '
2,206,433
30,000
115,000
3,251,623
1,258,764
41,500 ,
70,000 I
281,413
183
1,894,893
840,000
115,000
70,000
370,973
584
25,.,
.........
em,
3,_,
·....iii;
1,.,
.........'10,
3117,
76,558
388
-197,436
44
-3,000
-10,000
3,000
167,439
-3,049
115
137,229
-2,070
60
688,438
83,427
60
823,846
80,533
8
36
36
388
44
388
500,691
-35,880
421,644
48,460
508,109
99,175
883,462
89,250
1,008"
41
-1,921
-2,106
162
-5,258
-5,299 Ii
121,592
116,172
118,
27,089
32"
-13,002
-13
32,031
-155
I
125,338 ,
-25,955
4,935
10,283
Labor Department:
Unemployment trust fund:
i
Public debt securities ............................... !
Agency securities ...••.............................. I
PartiCipation certificates •............................
Other ...................•............................ ,
State Department
Foreign service retirement and disability fund ..•.••.....•
Other••....................................•.•........
2,764,853
-96,500
230,000
800
I
i
32,024
175
8511,
80,
83,
-4,519 '
1,000
17,383
25,096
10,294
1,000
Il,f
l,C
1,174,194
-146,500
-90,000 ,
-6
1,022,525
-57,000
180,000
-115
11,061,159
146,500
355,000
109
12,255,555
......;
-285
15
41,860
15
46,520
5,460
35
265,000
103
12,235,
47,
50
1
Transportation Department:
Coast Guard ......................................... .
Highway trust fund •....................................
Treasury Department:
Public debt secur ities ................................. .
Agency secur ities .................................... .
Participation certificates •............................ "
General Services Administration ......................... .
42,361
-4,000
...........
534,411 ,
10
256,614 ,
I
I
-722,167
-25,000
100
I
-540,852
_25,000 ''
-23,000
-140
1
10
978,324
759,838
25,000
2,000
1,667
1,512,7
41,671
37,6
.... · .. 2;000
...... ·2;0
1,767
1,7
TABLE IV-SCHEDULE B--INVESTMENTS OF GOVERNMENT ACCOUNTS
IN FEDERAL SECURITIES--Contlnued (In thousands)
Securities Held as Investments
Current fiscal Year
Net Purchases or Sales (-j
Classification
This Month
-
aus Admlnistr ation:
II'IIIS reopened insurance fund ..................... .
erlllS special term msurance fund ••••••••••••••••••
IItJllDent life insurance fund:
-.bIle debt securities ............................. .
~y securities ................................. .
:!iiPal service lil.. Insurance fund:
IPbliC debt securities ••••••••••••••••••••••••••••••
pncy securities ................................. .
'irticlpation certificates ••••••••••••••.••••••••...•
111'•••••
t
.t_.· . ················ ................................... .
independent agenci~s:
UService CommlSSlon:
Ivll service retirement and disability fund:
Public debt securities •••••••••••••••••••••••••••••
Agency securities ••••••••••••••••••••••••••••••••
participation certific~tes ••••••.••••••••••••••••••
I!nployees health benehts fund· ...................... .
mployees life insurance fund ••••••••••••••••••••••••
_ed employees health benefits fund •••••••••••.••••
part·Import Bank of the United States •.....•..•.••....
lIP Credit Administration:
lauks for Cooperatives:
Public debt securities •..•....•.•..•.•.••••.•......
Agency securities .............................. ..
llederal Intermediate Credit Banks:
Public debt securities ............................ .
Agency securities •••••••••••••••••••••••••••••• ;.
~al Deposit Insurance Corporation •••••••••••••••••
~al Savings and Loan Insurance Corporation:
ilublic debt securities ............................. .
\geney securities ................................. .
?articipation certificates ........................... .
lIroad Retirement Board:
ilublic debt seeur ities •••••••••••••••..•••••••••••••
I.gency securities ................................. .
Participation certificates ••••••••••••••...••••••••••.
Fiscal Year to Date
This Year
Beginning of
Prior Year
$7,645
9,246
134,609
28,471
$34,546
24,704
23,939
-34,569
62,373
180,535
-102,096
-67,500
175,000
686
1ll,442
-42,000
155,000
............. . ............ . ............
..............
"'
.....................
.. ...................
852,956
.............
.............
1,450
49,074
-1,800
.............
.............
.............
.............
.............
-3,539
118,335
.............
..............
645,458
..............
1,824,117
-96,500
100,000
6,764
143,045
-1,996
596,735
-7,000
210,000
24,758
45,753
2,382
-81,500
. .................
-56,781
10,739
-2,650
-137,009
-10,500
312,655
27,712
8,700
258,232
215,786
_4,000
70,950
171,976
4,000
88,600
. .............
130,755
-71,500
25
This Year
This Month
Close of
This Month
$87,099
214,086
$114,063
233,311
$121,708
242,557
876,400
817,892
841,831
5,573,118
5,753,653
1,756
1,756
. ............ .............. .. .........................
5,855,749
67,500
305,000
1,070
17,900,006
96,500
410,000
99,836
495,148
3,820
•...... 400;000 ......................
400,000
18,871,967
... t .................
510,000
105,150
589,119
3,624
19,724,923
...............
510,000
106,600
638,193
1,824
.............. . .............. . ..............
56,781 .............. ....................
............. . ............. .................
137,009 . ............. ...............
10,500 ' . ............. ...............
3,840,632
4,156,826
4,153,287
1,900,244
4,000
88,600
1,997,695
2,116,030
159,550
159,550
3,581,044
4,226,502
............... . ...............
..............
.............
1e1' .............................................. .
140
. .............
-35,469
10,000
160,000
509
24
4,095,747
71,500
210,000
148
517
657
Total. ....................................... .
2,054,291
8,521,983
5,320,125
79,137,448
85,605,140
87,659,432
...............
.............
. .............
-594,600
480,600
-114,000
-15,000
-74,000
594,600
200,000
................
-320,682
-932,205
213,388
937,560
326,037
5,355
.......... ...
.............
.............
..............
. ..............
.............
.............
.............
86,500
86,500
41,500
20,000
4,000
17,705
61,500
86,500
67,500
.............
.............
. .............
. ............
.............
..............
86,500
86,500
41,500
20,000
4,000
60,165
61,500
86,500
67,500
86,500
86,500
41,500
20,000
4,000
17,705
61,500
86,500
67,500
-42,460
471,705
.............
.............
514,165
471,705
MEMORANDUM
· ...... 2i6;ooo ................
210,000
F=====~======~====~======~====~=======
lIments in securities of privately owned
7ernment-sponsored enterprises:
~uded In
the Loan Account:
IlvU service retirement and disability fund •••••••••••
Federal old-age and survivors ins. trust fund •••••••••
Federal hospital insurance trust fund •••••••••••••••••
Pederal disability Insurance trust fund ••••••••••••••••
Indian tribal funds .••••••••••••....••.••.••.•.•.....
Puttclpation sale s fund ............................ .
retirement account ........................ .
nemployment trust fund ........................... .
Veterans life insurance trust funds •••••••••••••••••••
rllroad
Total ........................................ ..
tappUed to current year's surplus or defiCit:
~IVU service retirement and disability fund •••••••••••
Federal old-age and survivors ins. trust fund •••••••..
edera! hospital insurance trust fund ••••••••••..•••.•
~ederal dis~bility insurance trust fund •.••••••••••••••
ped~;ral Savll1gs and Loan Insurance Corporation .••••••
~Cipation sales fund ••••.•••••.•••...•.•••.......
~ oad retirement account •••.••......•...•.•.•..••
"nemployment trust fund •..•...•..•••.•...••.•....•.
,eterans life insurance trust funds ......•..•.......•.
_Total ........................................ .
-200,000
................
.............
.............
40
-70,722
-50,000
.............
.............
..............
............ '* ... +
-42,460
.............. . ............. ...............
............... ................. . .. ...............
............. .. · ......5;:ii5 .................
5,355 .............
. ............
5,355
70,722 . ...............
292,960
-292,960
113,788
50,000
50,000 . ..............
-64,000
-50,000
-114,000 ............. . .............. ................
...............
............. ............. .......... .... . ............. ............ ....
~
... "............
..............
.............
.............
.............
.............
...............
.................
.............
.............
TABLE V--COMPARATIVE STATEMENT OF BUDGET RECEIPTS AND OUTLAYS
26
BY MONTHS OF CURRENT FISCAL YEAR
(Figures are rounded in millions of dollars and may not add to totals)
Classification
July lAu g . Sept., Oct.
I'
Nov.
I
;
Dec.
Jan.
Feb. iMarch,April
May, June
I
Fiscal
Year
To
Date
Com.
parable
Est
Period i InaI
Prior ,CIIr:
187,226
168,'1211 / _
F4~
1
------------------------------~--+_--+_------T_--------------_.--~--~-----
~9'
RECEIPTS
individual income taxes ............... .
Corporation income taxes ............. .
Social insurance taxes and contributions:
Employment taxes and contributions ...
Unemployment insurance ..•...•......
Contributions for other insurance and
retirement .••....•......•.........
Excise taxes •..............•...•......
Estate and gift taxes .............•.....
Customs ..........................•..
Miscellaneous .........•.•....••..•..•
Total
, $5,013 i 6,360
19B $5,299'$6,483 :S6,397
I 2,175
538 5,000 1,278
559 5,159
1 2,093 3,664 2,383
114
618
55
1,944 3,126: 1,865
108
346
49
110' 22L7 ,287 S3, 999
1,so31
1,79
12,106
682 4,965 5,323
J 3,924
15~,
773
~4,
I'
760 $10,100
8,606
806
2,603 3,513 4,735
63
162
821
218!
183
198
206
1~~
1,254i1,152 1,156 1,160 1,272
277
230
308
631
310
1191
144
197
224
213
202<
216
238
271
237
172
1,386
306
210
422
'11,658 3,20818,741 10, 726~2, 712:15,828 15,853'14,589 13,728123,59613,346
23,855
,
204
167
213
, 1'234428 1,175 1,223
229
229
205
210
205
174
247
235
204
187 , 204
1,222 1,354 1,412
242' 229
256
212
1861 195
217
241
292
OUTLAYS
'
Legislative Branch.... ... ... ..........
21
37
19
23
171
28
The Judiciary.........................
8
9
9
8
9 1[
8
Executive Office of the President ......•
2
3
3
2
2
2
Funds appropriated to the President:
1
Military assistance. . . . . . . . . . . . . . . . . .
135
70
53
79
791
-23
Economic assistance ..•..•.•••......
141
169
150
193
1421
80
Other........ ... ...................
219
211
161
177
155
186
Agriculture Department:
Commodity Credit Corporation, foreign
I
assistance and special export
,
programs ........................ ! 380
946 1,419
841
470
393
Other ..............................
246
340
266
426
3101
282
Commerce Department ................
77
57
42
109
641
77
Defense Department:
Military:
I
Department of the Army ........... , 1,593 2,202 2,138 2,165 2,04512,307
Department of the Navy ............ [1,568 1,848 1,864 1,959 1,761,1,898
Department of Air Force .........•
2,023 2,055 2,098 2,227 2,180 2,092
Defense agencies. . . . . • . . . . . .• . . . •. i 254
288
295
341
325
360
Other. . . . . . . • . • . • . . . . • . . . . . • . . . ..!
22
47
13
76
28
46
.!
l
I
~
36,696
2 595
, 57
I
3,325
He~t~~~· Ed;'~~ii~n:: ~d"';ie'li~;~"'"'''' I
1
277
109
31
2551
9281
783
1,795
2,381
664 i
1,844 i
2,41511
76
1821
181 ,
7
99
181
83
129
183
44
181
192
51
129
224
130
199
310
504
106
80
16
177
81
-5131'
21
63
I
I
3,<Xil
2,038
2,493
5,219
3,212
854
t
I
I
I
i
I
4,509 I
I
[
I
H
I
191
9 1
3
10
-38
485
64
2,<Xil
I 153,671
i
2'799~
i
807
I
2,0?0 1,98~! 1,945 2,286 2,033
1,926 1,71211,961 1,846 1,~~
2,179 2,171 2,243 2,193 2,126
3~,
31~i
338
309
313
...,
49,
56,
48
49
2,339
2,219
2,355
305
60
25,102
22,520 I
25,943'
3,790
537
25,294 i
22,110
25,797,
3,740 :
432 '
31
6,568 6,227
7,278
77,893
77,373,
TI,
131
1,268
1,300
1,
694
7,089
5,967
7,
2,545
247
406
24,691
2,613
4,758
21,622
2,237
3,815
31,
2,
4,
165
167
1,840
5,602
5,404
-140
31
46
1,537
243
69
97
36
2,790
t---+--+--+--f_---"-'+---+---"-'f--+---+-~--f_--+_--
Total Military .................. 15,461 6,440 6,408 6,7686,336 6,702
i.
2,350
187,843
30
11
3
217
177
54i
31
I
3,346
i
i
21
9
3
4321
376
87
29,ZM
14,079
25
8
2
I
•
15,213
3,478
2,319
2,991
1
9
3
3
34,245
I
28,685
6,543 6,682 6,480
84 1
98
125
113
170
120,
114
87:
501
79
95
Department:
,
,
Social and Rehabilitation Service. . . . . . ' 497
556
569
492
638,
569
548
751
507
646
623
Federal old-age and survivors
insurance trust fund .............. . , 1,957 1,988 1,986 2,013 1,996 2,004 1,996 2,040, 2,055 2,069 2,042
Federal disability insurance trust fund. I 207
210
209
213
216
213
219
214
220
223
224
357
341
Federal hospital insurance trust fund .. , 378
393 1 368
393
421
393
427
450
432
Federal supplementary medical
insurance trust fund.. . • . • • • . . . . . . .. 1 146
151
137
155
1501' 146. 149
179
147
156
159
Other. . . . . . . . . . . . . . . • . • . . . . . . . • . . . .
342
509
521
529
466
448
492
499
549
505
574
Housing and Urban Development
35
Department •••..••................... ' 336
345
164
29
322
-70
275
-19
207
54
122
Inter ior Department. . . . . • . . . . . . . . . . . . .
-192
134
171
86
63
90
71
67
67
123
30
43
Justice Department ...•...............
33
45
42
47
51
51
42
50i 39
Labor Department:
1
175
179
Unemployment trust fund ..•...•......
182' 1751 229
206
292
323
209
311
266
46
54
58
Other .........•.............•......
53
65
49'
48
66
61
51
64
70
85
108
69
Post Office Department .....••.•.••....
-38
41
74
128
129
189
36
70
34
72
State Department ...........•..........
30
24
28
21
32
32
38
15
Transportation Department:
Highway trust fund ................. .
433
454
528
429
395
353
224
332
190
213
247
Other ........•.....................
118
131
165
182
142
158
160
157
135
134
156
Treasury Department:
Interest on the public debt ........... . 1,347 1,332 1,311 1,360 1,335 1,385 1,393 1,372 1,436 1,418 1,431
Interest on refunds, etc ....•.........
9
10
14
12
10
12
Other ....•.•.....................•.
-11
18
26 -118
96
18
-2~ 4~
~ ~~ 3g
'I
.. -- 1----
1,532
22
25
4
r
I
1,
5,
4,140
235
411
2,
2,746
525
2,
987
435
1,080
424
352
181
4,151
1,818
4,171
1,561
4,
2,
1,493
9
11
16,613
127
221
14,573
16,
834
520
685
III
-48
TABLE V--COMPARATIVE. STATEMENT OF' BUDGET RECEIPTS AND OUTLAYS
27
BY MONTHS OF' CURRENT F'ISCAL YEAR--Continued
(Figures are rounded in millions of dollars and may not add to totals)
Classification
II
I July
I
I
Aug.
I
I
I
I
Jan.
ComFiscal
Year parable
Period
To
Prior
Date
F. Y.
Oct.
Nov.
$200 $219
27
27
$187
33
$222
32
$230
42
$168
11
$178
54
$209
28
$185
44
$248
97
334
353
347
335
385
353
367
327
Sept.
Dec.
,
I
Feb. March April May
June
I
Estimates
Current
F. Y.
OUTLAYS -Continued
(IDle Energy Commission ••••••••••••
IIefiI Services Administration ••••••••
iUooal Aeronautics and Space Adminis-
eation , ••••
III'"
III • • • • • • • • • • • • • • • • • • • • •
$186 $216
1
32
277
434
342
393
llerans Administration:
Compensation, pensions, and benefit
:ograms ..........................
vernment life insurance fund ••..••.
National service life insurance fund .••.
Other ..............................
ller independent offices:
Civil Service Commission •••••.•••••.
Export-Import Bank of the
United States .••••..•.•.•••••.•••••
Small Business Administration .•••..•.
Tennessee Valley Authority ..•.••••.••
Other ....••..•.....•••.........•.•..
!distributed intrabudgetary
ransactions:
Federal employer contributions to
retirement funds ..•••••..•••....•..
Interest credited to certain
Government accounts .•............•
llowances, undistributed •..•....••..•.
...... ..... ..... ..... ..... . .... ..... ..... ....... . .... ......
Total. .....•.....•...............
14,217 16,355 6,235 16,839 5,124 14,394 15,761 14,734 15,639 15,972 15,764
II'Plus (+) or deficit (-) ................
I
$2,450
430
$2,466
413
$2,451
413
4,247
4,721
4,247
I
419
9
61
101
425
6
51
116
416
4
41
160
429
7
54
107
459
5
39
114
453
6
50
114
46~1
1~1
485
5
51
108
178
173
200
194
190
146
371
163
29
9
9
392
50
47
15
139
40
10
15
77
23
16
16
187
26
6
21
61
-140
13
23
-19
-51
4
10
156
102
-169 -181
-155
-207
-157
-170
-172
I,
497
7
60
148
509
7
62
114
524
8
55
97
514 i
6'
47 I
86
5, 594
76'
627
1,373
192
111
233
-64
1,754'
1
59
68
2
11
204
45
2
23
207
109
-2
13
189
-175
-177
-178
-189
(-)
I
1
078
5, -14
471 ,
1,323 i
5,433
78
626
1,582
2,704
i
1,705
790
284
137
2,413 '
165
100
177
1,844
1
1
-5~
I
31 :
83 !
246
111
187'
1'' '1
-2,091'
-1,896
-2,105
-2,674
-3,000
13,736 ! 184,769
178,834
184,901
+3,074
-25,162
+1,191
-160
I
-33 -100
-23
-58
-107
-2,559 .J, 147 2,506 -6,11 -2,412
-671
1,435
-32
+92
-127
-33
-76
-1,736
-103
-145 -1,911 +7,625 2,418
•
•••••••
+10,119
I
I
-3,099
•••••••
....... .........
....,
TABLE VI--SUMMARY OF RECEIPTS BY SOURCE AND OUTLAYS BY FUNCTION (In thousands)
Total
Budget
Current Fiscal Year to Date
The
Total
Loan
Expenditure
Account
Budget
Account
This Month
Source
The
Expenditure
Account
Loan
Account
I
I
I
i
co
Comparable Period Prior Fiscal Year
The
Expenditure
Account
Loan
Account
Total
Budget
NET RECEIPTS
Individual income taxes ..........••....................
Corporation income taxes ..........................•••.
Social insurance taxes and contributions:
Employment taxes and contributions ......•....•.......
Unemployment insurance ..............•••..•.•....••.
Contributions for other insurance and retirement .......
Excise taxes ..........................................
Estate and gift taxes ...................................
Customs .•........•...................................
Miscellaneous ........•.......•..........•••.....•.....
310,100,045
8,606,495
..............
..............
$10,100,045
8,606,495
$87,225,565
36,695,990
..............
$87,225,565
36,695,990
t68, 725, 513
28,664,673
.............................
.............
$68,725,513
28,664,673
2,595,348
57,062
172,472
1,385,991
305,597
210,205
422,136
..............
..............
..............
..............
..............
..............
..............
2,595,348
57,062
172,472
1,385,991
305,597
210,205
422,136
34,244,544
3,324,993
2,349,649
15,213,383
3,477,596
2,319,467
2,991,466
..............
34,244,544
3,324,993
2,349,649
15,213,383
3,477,596
2,319,467
2,991,466
29,223,788
3,345,624
2,050,532
14,079,045
3,050,696
2,038,238
2,493,313
..............
..............
..............
..............
..............
..............
..............
29,223,768
3,345,624
2,050,532
14,079,045
3,050,696
2,038,238
2,493,313
Total ....•.........•..........•..•......•.•.•....
23,855,350
..............
23,855,350
187,842,654
167,842,654
153,671 422
...............
153 671 422
68
16,163
81,255,267
3,770,217
4,246,550
5,591,928
2,112,982
7,994,851
363,465
7,351,963
49,642,598
7,449,672
15,850,074
2,848,595
-5,189,485
80,526,335
3,962,114
4,720,686
4,549,491
1,662,173
7,772,399
439,262
7,215,500
43,422,699
6,746,640
13,745,665
2,610,364
-4,569,970
-$9,944
907,262
1,076,351
17,076
212,624
3,202,483
379,554
102,645
147,531
. .............
81,250,801
4,127,338
4,246,550
6,076,080
2,118,873
8,013,260
1,115,050
7,591,070
49,002,643
7,703,395
15,850,074
2,863,018
-5,189,485
. .............
-5,418
. .............
80,516,391
4,869,376
4,720,686
5,625,842
1,679,248
7,985,023
3,641,745
7,595,053
43,525,344
6,894,171
13,745,665
2,604,946
-4,569,970
183,288,677
1,479,989
184,768,666
172,803,357
6,030,164
178,833,521
..............
..............
..............
..............
..............
..............
..............
..............
OUTLAYS
National defense ...•....................•.........•....
International affairs and finance ...•..............•......
Space research and technology •.....•.•..•.••.....••....
Agriculture and agricultural resources .....•..........•.
Natural resources ........•.•................•....•....
Commerce and transportation .........•........•..•.••..
Community development and housing .........•.•••..••.••
Education and manpower ....................•....•.....•
Health and weliare .••..••................•..•.•........
Veterans benefits and services .......•......•...•..•..•.
Interest •..........•...•...............•.•........•....
General government. ..•••.•................•.....•..•.•
Undistr ibuted intrabudgetary transactions •.....••.•..•.•.
7,663,423
429,171
326,517
-694,694
127,870
695,937
-37,957
940,873
4,216,051
635-,488
1,407,043
291,197
-1,895,929
..............
6,141
..............
7,663,432
445,334
326,517
-671,710
128,825
696,050
-248,980
965,606
3,966,411
655,949
1,407,043
297,338
-1,895,929
Total ......................................•••...
14,104,990
-369,104
13,735,686
..............
22,984
955
114 1
-211,023 '
24,733
-249,640
20,461
-$4,466
357,121
..............
484,152
5,891
18,408
751,585
239,107
-639,956
253,723
..............
14,423
~
...............
~c=t.==~~-·-~_~-==~~c~--~b-
.. _
..........
For sale by the Superintendent of Documents, U. S. Government Printing Office, Washington, D. C. 20402
Subscription price $6.00 per year (domestic), $11.00 per year additional (foreign mailing), Includes all issues of daily Treasury statements and
the Monthly Statement of Receipts and Expenditures of the U. S. Government. No single copies are SOld.
GPO 876-834
TREASURY DEPARTMENT
i
WASHINGTON. D.C.
July 28, 1969
FOR IMMEDIATE RELEASE
STATEMENT OF SECRETARY KENNEDY ON
RATIFICATION OF SDR AMENDMENT
The International Monetary Fund informed me today that
the Amendment to the Fund's Articles of Agreement, which
includes the provisions for the Special Drawing Rights facility, has been formally ratified and has now entered into force.
For the first time, the nations of the world can, by conscious
tnternat5. onal dec is ion, create internat ional reserve assets
to supplement supplies of gold and foreign exchange.
The Amendment is the first major change in the Articles
of the Fund since the original Bretton Woods Articles became
effective in December, 1945. It represents an enlightened
willingness of Fund members to work together in a spirit of
cooperation to adapt the Fund Agreement to meet the problems
of today and tomorrow.
I strongly support a decision to activate the Special
Drawing Rights Facility in substantial amounts at the time of
the Annual Meeting of the Fund later this year in Washington.
I anticipate that the Managing Director will be able to make
a formal proposal to that effect in ample time for a decision
by the Governors.
The consensus reached among the Deputies of the Group of
Ten at last week's meeting in Paris is a major step towards
that objective.
We can, therefore, look forward with confidence to a
reasonable rate of growth in world reserves in amounts adequate
to support future expansion of international trade and payments.
The quiquennial review of quotas in the Fund is also due
in 1970. The discussions among the Deputies point toward an
enlargement in those credit facilities which will further
strengthen the monetary system.
000
151
rREASURY DEPARTMENT
WASHINGTON. D.C.
July 30, 1969
FOR IMMEDIATE RELEASE
WEEKLY TREASURY'S BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,800,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing August 7, 1969,
in the amount of
$2,800,762,000,
as follows:
91-day bills (to maturity date) to be issued August 7, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated
May 8, 1969,
and to
mature
November 6, 1969, originally issued in the amount of
$1,300,282,000,
the additional and original bills to be
freely interchangeable.
182aay bills, for $1,200,000,000,
dated August 7, 1969,
and to mature
or thereabouts, to be
February 5, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time,
Monday, August 4, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"ima1s, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application the refor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
S~bmit tenders except for their own account.
Tenders will be received
wlthout deposit from incorporated banks and trust companies and from
K-152
-
t. -
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announ,
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Secretary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subj ect to these reservations, noncompetitive tender!
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on August 7, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
August 7, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revir.~on) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be nbtained
from any Federal Reserve Bank 0cO~ranch.
.REASURY DEPARTMENT
WASHINGTON. D.C.
July 30, 1969
TREASURY ANNOUNCES AUGUST 15 REFUNDmG TERMS
The Treasury today announced that it is offering holders of the $3,366
mllion of 6% Treasury Notes of Series C-1969, maturing August 15, 1969, the right
to exchange their holdings for a 7-3/4% 18-month Treasury note to be dated August 15,
1969, to mature February 15, 1971, at a price of 99.90 to yield about 7.82%.
Subscribers will receive a cash payment for the difference between the par
value of the maturing notes and the offering price of the new notes.
The public holds about $3.2 billion of the maturing notes.
Cash subscriptions for the new notes will not be received.
The books will be open for three days only, on August 4 through August 6, for
the receipt of subscriptions. Subscriptions addressed to a Federal Reserve Bank or
Branch, or to the Office of the Treasurer of the United States, and placed in the
mail before midnight August 6, will be considered as timely. The payment and
delivery date for the notes will be August 15, 1969. The notes will be available
in registered as well as bearer form. All subscribers requesting registered notes
will be required to furnish appropriate identifYing numbers as required on tax
returns and other documents submitted to the Internal Revenue Service.
Coupons dated August 15, 1969, on the maturing notes should be detached and
cashed when due. The August 15, 1969, interest due on registered notes will be
paid by issue of interest checks in regular course to holders of record on July 15,
1969, the date the transfer books closed.
Interest on the new notes will be payable on February 15 and August 15, 1970,
and February 15, 1971.
K-153
2V7
FOR RELEASE ON DELIVERY
STATEMENT OF EUGENE T. ROSSIDES
ASS.(STANT SECRETARY OP THE TREASURY
BEFORE THE
SUBC0M11IT'I'EE ON IMPROVEMEN'.rS IN JUDICIAL MACHINERY
OF THE
SENATE JUDICIARY COMMITTEE
ON S. 2624
August 4, 1969
Mr. Chairman and Members of the
Subco~~ittee:
I am Eugene T. Rossides, Assistant Secretary
of the Treasury for Enforcement and Operations.
My
responsibilities include supervision of the Bureau
of Customs.
I would like to introduce Mr. Lee
Ritger, Assistant General Counsel of the Treasury,
and Mr. Leonard Lehman, Deputy Chief Counsel of
the Bureau of Customs, who have participated, over
a period of years,in the drafting of the proposed
legislation.
I
ap~reciate
the opportunity to appear before
your Committee to present the Treasury's
unequivocal support for the enactment of S. 2624
K-154
2
"To improve the judicial machinery in customs courts
by amending the statutory provisions relating to
judicial actions and administrative proceedings in
customs matters, and for other purposes.
1I
This
bill has been prepared by the Treasury and Justice
Departments, working in the closest kind of joint
effort, and we are in complete accord with its
provisions.
But, in a larger sense, this bill is a monument
to Mr. Just£ce Clark and the Federal Judicial
Center and Judge Rao and the Customs Court.
support and efforts have been crucial.
Their
I would
also like to add that Judge Rao and his colleagues
on the Customs Court have done an outstanding job
with an archaic statute.
3
First, I wish to place this proposal in
perspective.
The bill's purpose is confined to
revising the administrative procedures under which
duty liabilities are determined and to modernizing
the judicial procedures in the United states
Customs Court and Court of Customs and Patent
Appeals.
It does not affect rates of duty nor
the substantive provisions of law relating to the
basis of duty assessments, such as the statute
governing the determination of value of imported
merchandise.
In other words, it is not intended to
have any commercial or financial impact on our
international trade, favorable or unfavorable.
It
has been deliberately drafted to be "trade neutral."
4
We believe that this bill will enable the
Treasury Departmentts Bureau of Customs, the Departrnent of Justice and the customs courts to deal with
the ever-escalating volume of import transactions
far more efficiently and effectively than they have
been able to
~n
the past.
To give your Committee an idea of how the volume
of customs collections and transactions has been
rising, even in the last five years--in fiscal year
1964, the Customs Service collected over $1.8
billion and processed 1.7 million formal entries; in
fiscal year 1969, however, Customs collected over
$3-lj4 billion and processed over 2-1/2 million
formal entries.
Each year, Customs handles hundreds
of millions of other types of transactions.
For
5
example, each of the more than 200 million persons
who arrived in the United States in 1968 had to
clear customs.
I presented figures only for the
formal entries because typically they cover
commercial importations and, therefore, are the
source of nearly all the litigation in the customs
courts.
Enactment of this bill would olimax efforts
begun a number of years ago to modernize procedures
in the Bureau of Customs relating to duty assessment.
Under Reorganization Plan No. I of 1965, the
Bureau of Customs took a giant step into the 20th
century by redesigning the Customs administrative
organization to meet the demands of expanding international trade and travel.
Major goals achieved
under that plan were the elimination of all
Presidentially-appointed customs officials at the
local level and the consolidation, primarily under
career district directors, of the separate
6
organizational units for which those former
Presidential appointees were responsible.
The primary
authority and responsibility for supervising the
administrative and operating field activities of
these district directors were placed in nine
regional commissioners of customs, who report directly
to the Commissioner of Customs.
The Treasury Department, the Bureau of Customs,
and the Justice Department now seek to complete the
procedural phase of the reorganization process begun
in 1965 by revising the outmoded statutory procedural
requirements.
We believe the bill does so in a way
which balances the interest of the Government, the
importing community and the domestic producers.
Before briefly describing the highlights of the
7
bill, an outline of the history of t~e procedures for
determining the value of imported goods is relevant
and would be of interest to your Committee.
In the earliest days, Customs valuations of
goods were not open to judicial review.
The first
Congress, in 1789, provided that collectors of
customs would accept value stated on original
invoices as the basis for assessment of duty.
If
original invoices were not produced, the collector
would
appoint a merchant appraiser familiar with
the goods, the importer would also appoint a merchant
and the two, under oath, would make the appraisement.
In 1823, the President was authorized to appoint
United States Appraisers for certain ports and at
8
other ports, Collectors appointed "responsible
resident merchants" to be appraisers.
If an importer
was dissatisfied with the Government's appraisal, he
could employ, at his own expense, two "responsible
resident merchants" who, together with the government
appraisers, would determine the value.
Appeals
could be taken to the Secretary of the Treasury but
his decision was final.
During this period, an
importer could obtain judicial review of duty
assessments by bringing an action in federal court for
a refund of duty paid and the court would decide
whether the collector of customs had assessed the
proper rate of duty.
However, the court could not
inquire into the merits of the value on which the
duty was assessed.
~
JJ5
Various changes were made in this system during
the 19th century, but it was not until 1890, when
the Board of General Appraisers wag created to review
decisions of the Bureau of Customs, that a system of
quasi-judicial review of value determinations was
established.
Nine general appraisers, three of whom
sat as a Board, were appointed by the President with
the consent of the Senate.
The Board's decisions
relating to duty assessments, including classification
as well as value, were reviewable by the circuit
courts of appeal.
The specialized Court of Customs Appeals was
created in 1909 to have exclusive jurisdiction over
decisions of the Board of General Appraisers.
The
9
10
court became the Court of Customs and-Patent Appeals
in 1929.
In 1926, tne United States Customs Court was
established replacing the Board of General Appraisers.
However, the change was largely one of name.
The
limitations and restrictions imposed on the Board
by the statute were retained for the Court.
Thus, it is almost 80 years since the existing
system of administrative determinations of duty
liability coupled with judicial review saw its
beginnings.
We believe the time has corne to revamp
and modernize the system.
Before turning to a description of the changes
we propose to bring the present procedures in the
11
Bureau of Customs up to date, let me describe briefly
the present procedures leading to judicial review .
.
Under Reorganization Plan No.1 of 1965, the
appraisement and classification functions were
consolidated under the supervision of local district
directors.
Essentially, the purpose of appraisement
is to determine the value of merchandise against which
the statutory rate of duty is to be applied.
The
purpose of classification is to determine the dutiable
category under the law into which the merchandise
falls.
Notwithstanding this administrative amalgamation
of the two functions, the applicable statute still
requires separate procedures for the appraisement and
classification of imported merchandise.
The importer
12
is entitled to separate judicial review of the
appraisement determination and if this is undertaken,
other processes relating to the assessing of duties
must be halted while the appeal is pending in court.
The classification of the merchandise and completion
of other administrative processing necessary to
"liquidate" the entry (procedures involving the
fixing of the duties due, the assessment of any
additional duties due or the refunding of any overpayments of duty tentatively estimated and paid when
the merchandise is initially landed) must a\vait the
final court decision on the appeal for reappraisement.
When the process is resumed, after the judicial
review of the
appraiS&len~
determination has been
completed, and the entry is liquidated, the importer
13
is entitled to administrative as well as a new judicial
review of the liquidation.
Thus, the final
determination of the duty actually· owed to the Government,
or refund due the importer, may be delayed for years.
Moreover, under present law, which, as we have
seen, was enacted substantially in the 19th century,
appeals from initial Customs
administrative appraise-
ments are automatically referred to the Customs Court
without opportunity for any administrative review of
the appraisement.
On the other hand, the present law
provides that when an entry is liquidated and the
importer files a "protest" against the liquidation,
Customs shall review all aspects of the liquidation
which are challenged in the protest.
If the protest
is denied, however, the matter is automatically
14
referrred to the Customs Court.
No further or separate
action is needed to invoke the Court's jurisdiction.
These automatic referrals
dem~an
the dignity and
status of the Customs Court as a constitutional
court.
In addition, the procedures do not permit the
importer the conscious choice normally exercised by
allegedly aggrieved parties of deciding, after
administrative review, whether or not to litigate.
In some cases, the importer might be quite content to
accept the Customs position after the original
decision has been reviewed and affirmed at the
administrative level.
This automatic and indiscriminate judicial
review procedure, at a time when the volume of
international trade is rising, has resulted in a
15
tremendous increase in court workload.
It has also
caused manpower and storage facilities at the Customs
administrative level to be wastefuily utilized in
transmitting records to the court and maintaining
open files on numerous cases which experience has
demonstrated will be abandoned by the importer or
settled through stipulated agreement between the
Government and the importer.
s.
2624 provides for a single customs adminis-
trative procedure for the determination of the duty
liability of imported merchandise.
All decisions,
including appraisement and classification, which are
necessary to the final duty determination and entry
"liquidation", will be combined in a consolidated
administrative process and subject to administrative
16
review in a single proceeding.
In addition, the
bill authorizes administrative reconsideration of
the appraisement decision, thereby eliminating the
archaic situation under existing law which compels
a district director to appeal his own appraisement
decision to the Customs Court to correct an admitted
appraisement error discovered after the entry has
been officially appraised!
The bill gives to importers a gO-day period
from the date of liquidation in which to protest
any administrative determination, and permits the
importer and Customs to take up to 2 years to
resolve their differences at the review leve.l before
the importer must resort to judicial review.
The
extended time periods in which the importer may
17
file his protest and the Government may review it
will help to eliminate the protest filed merely as
a protective measure and will insure that each protest
receives the administrative consideration it deserves.
Finally, l.he hi.ll provides that administrative
review decisions become conclusive unless the
protesting party affirmatively initiates an action
in the Customs Court within six months following a
denial of a protest.
The Treasury Department believes that these
changes, meshed with the proposed modification in
Customs Court procedures set forth -in title I of the
bill, will provide significant benefits to importers
and all other segments of the public, and will permit
the Bureau of Customs to perform its important role
more effectively and efficiently in the future at
our gateways of international trade.
TREASURY DEPARTMENT
,
WASHINGTON. D.C.
July 31, 1969
FOR IMMEDIATE RELEASE
TREASURY REQUESTS SECURITIES ASSOCIATION, EXCHANGES
TO CONTINUE INTEREST EQUALIZATION TAX PROCEDURES
The Treasury Department today requested the National
Association of Securities Dealers, Inc., and national
securities exchanges to request its member firms to
continue existing procedures on securities transactions
which are subject to the Interest Equalization Tax. The
tax is due to expire at midnight tonight.
Treasury said that it expected that the Association
and the exchanges would soon announce rules in accordance
with this request. Technical details will be announced
by Treasury later today.
The text of Under Secretary for Monetary Affairs
Paul A. Volcker's letters follows:
"Under current law. the Interest Equalization
Tax will not be applicable to any acquisition of
stock of a foreign issuer or debt obligation of
a foreign obligor made after July 31, 1969.
H.R. 13079 passed by the House of Representatives on July 28, 1969, would extend the tax to
August 31, 1969, and H.R. 12829 reported favorably by the Committee on Ways and Means without
amendment would extend the tax to March 31, 1971.
"The Department of the Treasury will propose that, if the legislative process to extend
the tax is not completed before August 1, 1969, that the
proposed renewal legislation be amended to make clear
that, regardless of when the legislation is
K-155
- 2 enacted, the tax will apply to acquisitions on
or after August 1, 1969. Such an amendment would
assure the uninterrupted applicability of the
lET beyond July 31, 1969, at the same rate and
on the same terms in effect on July 31, 1969.
"Consultations with representatives of
the securities industry indicate that it is
both feasible and desirable to continue beyo~~
July 31 1969, procedures previously adopted tor
dealing in stocks ~f foreign issuers
and debt obligations of foreign obligors, especially
those applicable to the identification of foreign
securities owned by U.S. persons which may be
traded free 9f tax among U. S. persons. Such continuation will aSSGre the maintenance of orderly markets
in these securiLies pending action on the proposed
legislation, and such continuation will be confirmed in the proposed amendment.
"The Department of the Treasury, therefore,
reqLests that you arlopt the necessary rules callint; upon your members and member firms to continue beyond July 3], 1969, procedures existing
on that date for transactions and securities then
subject to t:l.e lET."
000
TREASURY DEPARTMENT
WASHINGTON, D.C.
July 31, 1969
FOR IMMEDIATE RELEASE
TECHNICAL DETAILS RELEASED ON
CONTINUING lET PROCEDURES
NOTE TO CORRESPONDENTS:
Attached are technical details on continuation of current interest equalization tax rates,
rules and procedures, as announced earlier
today in Treasury release No. K-155.
Banks and trust companies which are participating
custodians will continue as such through the
period August 1 to August 8, 1969, but thereafter
will continue only if certain procedures for
continuation of their status are followed.
Broker-
dealers now qualified as participating firms will
continue as such unless their status is terminated under
current procedures.
000
K-155A
~C7
July 31, 1969
Treasury Department Announcement
INTEREST EQUALIZATION TAX
CONTINUATION OF CURRENT PROCEDURES
AND RETROACTIVE EFFECT
The Treasury Department will propose that, if the
interest equalization tax is not extended before August I,
1969, the pending legislation be amended to (1) make it
clear that, regardless of when the legislation is enacted,
the tax will apply to acquisitions on or after August I,
1969, so as to assure uninterrupted applicability of the
interest equalization tax, and (2) confirm that the rates,
rules and procedures in effect on July 31, 1969, will
continue in effect during the period August I, 1969, and
extending until the legislation is enacted, in all respects
as if the tax had been extended prior to August I, 1969,
with the sole exception that the banks and trust companies
which are participating custodians will not continue as
such after August 8, 1969, unless the procedures described
below are followed.
The status of participating firms will
continue as such unless terminated under current procedures.
Under current law, the interest equalization tax is
not applicable to any acquisition of stock of a foreign
issuer or debt obligation of a foreign obligor made after
July 31, 1969.
H. R. 13079 passed by the House of
- 2 Representatives on July 28, 1969, would extend the tax to
August 31, 1969, and H. R. 12829 reported favorably by
the Committee on Ways and Means without amendment would.
extend the tax to March 31, 1971.
Some of the rules and procedures in effect on July 31,
1969, and which will continue in effect, are set forth
below along with the special procedures for participating
custodians.
1.
Participating Firms and Participating Custodians.
Those broker-dealers having status as participating
firms on July 31, 1969, will retain their status as such
with respect to acquisitions after such date, unless their
status is terminated and the termination announced under
existing procedures.
If any broker-dealer does not want
to continue its status as a participating firm, it must
follow such termination procedures.
Those banks (or trust companies) having status as
participating custodians on July 31, 1969, will retain
their status as such during the period August 1, 1969,
through August 8, 1969.
The status of each bank which is
a participating custodian will be terminated as of the
close of business Friday, August 8, 1969, unless the bank
-
3 -
files with the Commissioner of Internal Revenue,
washington, D. C., 20224
(Attn: CP:A:O-JW), a letter
indicating that such custodian agrees to comply, and is
currently complying with the statutory requirements in
effect on July 31, 1969, and the documentation, recordkeeping, reporting, and auditing requirements of the
Internal Revenue Service in effect on such date,or subsequently established.
To avoid termination of such status,
the letter must be received not later than 5 p.m.,
Wednesday, August 6, 1969.
A telegram stating that such
a letter has been mailed will be accepted for seven days
in lieu of such letter.
A list of those banks retaining
their status as participating custodians will be published
by the Internal Revenue Service on Thursday, August 7, 1969.
2.
Issuance of Validation Certificates.
Validation Certificates will continue to be issued
by the Internal Revenue Service after July 31, 1969.
The
Internal Revenue Service will follow those procedures
currently in force dealing with the issuance of Validation
Certificates, and will require such proof of status as
a United States person and compliance with the tax (on
the assumption that the proposed legislation will be
enacted) as is currently required.
- 4 3.
Payments in Respect of Tax.
During the interim period, the Internal Revenue Service
will continue to receive returns and payments in respect of
tax (on the assumption that the proposed legislation will be
enacted) and make appropriate refunds.
In the event that
the tax is not extended, all payments in respect of tax on
acquisitions made subsequent to the expiration date of the
current law will be refunded on an expedited basis upon submission of an appropriate claim to the Internal Revenue
Service.
4.
Participating Firms Purchasing and Selling Taxable
Securities for Own Account.
TIR 945 provides that a participating firm making a
sale of taxable securities for its own account must pay the
tax on or before the effective date of the sale (generally
the settlement date) if i t has issued a written comparison
or broker-dealer confirmation indicating that the exemption
for prior American ownership and compliance applies.
In
such cases the acquisition is currently reported on
Form 3780A which accompanies the payment of tax.
This
procedure, including payments in respect of the tax, will
remain in effect after July 31, 1969.
-
5.
5 -
Withholding Procedures.
The withholding procedures currently provided under
section 49l8(e) (7) and Temporary Regulation §147.5-2 will
continue to apply.
6.
Information Returns.
Reporting on information returns currently prescribed
in connection with the interest equalization tax will
continue in effect.
')70
TREASURY DEPARTMENT
WASHINGTON. D.C.
July 31, 1969
FOR IMMEDIATE RELEASE
STATEMENT OF TREASURY SECRETARY DAVID M. KENNEDY
ON THE SENATE AND HOUSE ACTION TODAY ON TAXES
Today's tax actions in both the House and Senate
moved President Nixon's anti-inflation tax program and
the proposals for comprehensive tax reform much closer
to final adoption.
The tax reform legislation announced by the House
Ways and Means Committee builds upon the tax reform
proposals made by the Administration last April 21.
While not agreeing with all aspects of the reform
bill as reported by the Ways and Means Committee,
Treasury believes that on balance it represents a highly
constructive step toward an equitable tax code.
Senate action in extending the income tax surcharge
at the full 10 per cent rate through December 31, 1969
underscores the general consensus on the importance of
action to rl1Tb inflation. Although the extension is
six months short of the full year extension requested by
the President, Senate Democratic leaders gave assurance
of early consideration of H.R. 12290, which includes a
full-year extension plus the repeal of the investment
tax credit and the other Administration measures.
Double assurance of positive action is indicated
by the vote in the House Ways and Means Committee which
adds to the bill an extension of the surcharge at a
phasing out rate of 5 per cent through June of next year,
the repeal of the investment tax credit, enactment of the
low income allowance, and postponement of reduction in
excises.
000
K-156
TREASURY DEPARTMENT
=
(
WASHINGTON, D.C.
FOR RELEASE 6: 30 P.M.,
Monday, August 4, 1969 •
.
RESULTS OF TREASURY r S WEEKLY BILL OFFERING
'!be Treasury DepartllEnt announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated May 8, 1969, and the
other series to be dated August 7, 1969, which were offered on July 30, 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
or thereabouts, of 91-day bills and for $1,200,000,000, or thereabouts, of 1'32-day
bills. '!be details of tbe two series are as fClllows:
PANGE OF ACCEPTED
COMPETITIVE BIDS:
High
Low
Average
91 -day Treasury bills
November 6 z 1969
Approx. Equiv.
Price
Annual Rate
98.247 ij
6.935~
98.226
7.018~
98.232
6.994';
182 -day Treasury bills
February 5 z 1970
Approx. Equiv.
Price
Annual Rate
96.444
7.034~
96.411
7.099';
96.418
7.085';
1/
maturin~
maturin~
Y
.y
Excepting one tender of $700,000
100% of the amount of 91-day bills bid for at the low price was accepted
95% of the amount of 182-day bills bid for at the low price was accepted
!roTAL TENDERS APPLTt:D FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philade lpbia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
lfJ.nneapolis
Kansas City
~llas
San Francisco
'lD'mLS
ApElied For
$ 38,443,000
2,044,744,000
40,893,000
50,440,000
36,749,000
46,951,000
160,141,000
51,800,000
27,059,000
33,762,000
33,310,000
139.587,000
AcceEted
$ 27,343,000
1,069,335,000
25,713,000
48,140,000
35,749,000
36,751,000
133,512,000
36,200,000
22,309,000
33,762,000
22,310,000
109,887.000
$2,703,879,000
$1,601,011,000
EI
APl2lied For
$
9,116,000
1,909,395,000
20,691,000
36,059,000
27,896,000
37,185,000
177,920,000
35,905,000
17,645,000
22,220,000
24,498,000
123.393.000
AcceEted
$
8,816,000
821,510,000
9,691,000
34,784,000
19,2g1,000
27,128,000
145, 95:>,000
26,905,000
8,145,000
21,420,000
14,198,000
62.393.000
$2,441,923,000
$1,200,231,000
£/
Includes $390 039 000 noncompetitive tenders accepted at the average price of 98.232
Includes $229' 415' 000 noncompetitive tenders accepted at the average price of 96.418
'l'oese rates a,;e o~ a bank discount basis. The equivalent coupon issue yields are
7.22~ for the 91-day bills, and 7.45'; for the 182-day bills.
TREASURY DEPARTMENT
t
WASHINGTON, D.C.
August 4, 1969
FOR IMMEDIATE RELEASE
TREASURY SECRETARY KENNEDY TERMS TAX BILL
A "MILESTONE" IN LETTERS TO MILLS AND BYRNES
The texts of letters, delivered this
morning, from Treasury Secretary David M. Kennedy
to Wilbur Mills, chairman of the House Ways and
Means Committee, and to John W. Byrnes, ranking
Republican member of the committee, follow:
K-157
I
I
~
~i'
"".c
..
....,~
· "i
n!"
~11e:r;
f~J!1
· 'iJl
:fr~i
~
~
~
.;
~
~
·~.
=.
:1) fi1i
r-r"
1··~~.
i~ifi!
ii·~l!
It
~,~
1=ira
"~f
rl~a
r 1
=i ri
~~~
~! i~;
M
I
I_ .f.;·
. i fil
lS~I! ~i fil
Iii r f ~
1-··
.:a.
-llit
I rt
li- ,If
il~
.. : if~l
-
R
C
if ! Ii I
l~lf t=i
,
~·l E
fif:!; i I~ li Ii
: iil if ~~·~111
~i f~ri~.f
rit:1l=
• r ::. 1
5~ f ;al1i
Ii ~!g
~~I~ "~ • • ~
~
8I f
a
i .... f r I
~.i"f! !ifrl
: a-lSi-" · .. ert
I~11 i&1
~.ii{ ~·~~~i
· ~i.i rI,.f; '.a;
:!
I
••• JI_~
1 s
"~
~ .~g&. ":1(1:
if
f"ffl·si~
eir
1t.(~1
w
en
w
--
~
Cj)
c=
J:::I
l,J
~
~
AUG 4 1969
I vrlta to .sprees tbe dHp appreciattea .t -eM Treuury
for ywr w1H pidaaee aad ,.our eoutaat dnot1oa to t;lae t.aak
.f tax refant thAt U8 oubdutacl to tM ftl1OrtJ.. of tt.
fn: llefoaa Act of 1969. w. are . .t arctte6al bJ JOG for the
help tlut , . . .... giftll to the A.dId.a1.trAt:1oa 1a .... loplD&
it. pr....tatloDa to the CGPdttn . . . . thnuah you ve wou1d
lUte to .suad our .iDeere tIwtk. N . .11 h tile ether
a.&*b11c• • • • ers ef tile ca 'ttH.
While we hne __ n""~t'leu . . .e eerbth ..,..1.1oM
1D tile -'111, . . flndy '-IteM tb«t . . . . . . . .1e. It "P".nt•• _.lor aile.toM 1D ux 1eabLttt.l o1I'lDd ....... it.
pro.pt $l$••sle. We kMw tlMtt , . hFM ........... taz nfora for _ay ,ean ad we are puce'" to 8M tlaat ,.... ea11
hl-I .., ..... boded.
Ass1.t.aat t~tary CeMa aM
... ..un .taff ,iola witb _ t. thtttald... ,... fft the ...,
courte8ies tut ,... .at tbe otlMr lepultllcma ...tlien ef
Ca 1tt•• twve utaade4 c. .. .t:.ri.as the ...,. _ b ill wId.el\
we bnte appure4 .feft tt. c. itt...
Utlder
~eeret~.ry ii~lkeTt
!be -':_18
JeIaa til. .rne8
.... of. lepreMDt.ttl...
w~. U. c. 20'15
t_
TREASURY DEPARTMENT
:
WASHINGTON. D.C.
August 5, 1969
FOR P.M. RELEASE
AUGUST 5, 1969
DEBT MANAGER LOOKS AT SAVINGS BONDS
Edward P. Snyder, Director of the Treasury Department's
Office of Debt Analysis, today told the Minnesota Bankers
Association Savings BondsCommittee that the savings bonds
program is a key element in the sound management of the
public debt.
Mr. Snyder pointed out that the Treasury Department
has been unable to issue new long-term marketable securities
since May 1965 and that, consequently, the average length
of the privately-held marketable debt has now fallen below
4 years. Since savings bonds, on the average, stay
outstanding for 7 years, the savings bonds program, in
effect, has resulted in the long-term funding of $52 billion
of Treasury obligations, a large part of which would
otherwise have had to be financed through short-term
marketable securities.
Mr. Snyder also told the Minnesota Bankers Association
Savings Bonds Committee that, year in and year out, investors
in savings bonds have received a fair return. The proposed
increase in the maximum rate to 5 percent, however, will help
bring the savings bonds program more in line with current market
rates without leading to any substantial disintermediation.
He added that the reduction in the maximum annual purchase
limits to $5,000 for both E and H bonds will also help to
prevent any disintermediation from developing.
Mr. Snyder congratulated the Minnesota Bankers Association
Savings BondsCornrnittee, and, especially, Mr. S. J. Kryszko,
President of Winona National and Savings Bank, who is Chairman
of the ABA Savings BondS Ummittee, on their effective support
of the program.
000
K-158
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 5, 1969
FOR IMMEDIATE RELEASE
MYLES J. AMBROSE SWORN IN AS
NEW COMMISSIONER OF CUSTOMS
Myles J. Ambrose, New York attorney, was sworn in
today as United States Commissioner of Customs by
Treasury Secretary David M. Kennedy. He succeeds
Lester D. Johnson, retired.
Ambrose, 43, assumes command of the 9,600 man Bureau
at a time when it is facing what Secretary Kennedy
described as "one of the greatest chal1 enges in Customs'
180 year history."
Noting that the Bureau of Customs is charged with
enforcing the Nation's smuggling laws, Secretary Kennedy
said, "President Nixon directed me early in the
Administration to regard the prevention of the smuggling
of narcotics, marihuana, and dangerous drugs into the
United States as an item of high priority."
"I instructed Assistant Secretary Eugene Rossides when he
took office as head of Treasury's enforcement efforts to make as
his first important item of business a major new effort to gUard
our nation's borders, ports, and airports against the illegal
importation of such drugs.
"President Nixon, in his message to the Congress on the
control of narcotics and dangerous drugs, pointed out that
most of the illicit narcotics and high-potency marihuana
consumed in the United States is produced abroad and
clandestinely imported.
K-159
(MORE)
- 2 "At the request of the President, " the Secretary
continued, "I have submitted a substantial program for
increased manpower and facilities in the Bureau of Customs to
more effectively shut off this illegal traffic.
"My first official directive to you, Mr. Ambrose, is
to make this program the first order of business in the
Bureau of Customs," Secretary Kennedy said.
Commissioner Ambrose has an extensive law enforcement
background. He served as Executive Director of the
Waterfront Commission of New York Harbor after leaving the
Treasury Department in 1960, where he was coordinator of its
national and international enforcement activities for several
years. He held the position of Administrative Assistant to the
United States Attorney for the Southern District of New York
in the 1950's and, in 1957, was appointed Assistant to the
Secretary of the Treasury for Law Enforcement.
The new Commissioner received his law degree at the
New York Law School after graduating from Manhattan College.
He is a member of the New York and Westchester County Bar
Associations and the Association of the Bar of the City of
New York; International Association of Chiefs of Police;
Guild of Catholic Lawyers; and the Friendly Sons of
St. Patrick. He is a trustee of the New Hampton School.
Mr. Ambrose is married to the former Elaine Miller.
They have three boys and three girls: Chris, Nora, Elise,
Kevin, Kathleen, and Myles Jr.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 5, 1969
FOR IMMEDIATE RELEASE
PAUL R. BEACH APPOINTED
DEPUTY ASSISTANT TO THE SECRETARY
Treasury Secretary David M. Kennedy today announced
the appointment of Paul R. Beach as Deputy Assistant to
the Secretary and Director of the Executive Secretariat,
succeeding Robert L. Joss.
Mr. Beach, a former legislative assistant to
Senator James B. Pearson of Kansas, resigned his position
as Assistant Professor of Economics at Arizona State University
to accept the Treasury post. A native of Kansas City, Kansas,
he received his education through high school in that city.
He attended Cornell University and Kansas State
University, receiving a B. A. degree from Kansas State. He
also attended the Justus Liebig Universitaet, Giessen,
West Germany, as an exchange student. He received his
M. A degre<' from Johns Hopkins University and has completed
all requirements for his Ph.D from Brown University in
Providence, Rhode Island.
Mr. Joss, who has been Director of the Executive
Secretariat since March of this year, has been appointed
Assistant to Assistant Secretary Murray Weidenbaum.
000
K-160
STATEMENT BY THE HONORABLE PAUL A. VOLCKER
UNDER SECRETARY OF THE TREASURY FOR MONETARY AFFAIRS
BEFORE THE SUBCOMMITTEE ON INTERNATIONAL FINANCE
OF THE HOUSE COMMITTEE ON BANKING AND CURRENCY
ON WEDNESDAY, AUGUST 6, 1969, AT 10:00 AM
I welcome this opportunity to appear before your Subcommittee to review recent international financial and
monetary developments in the months since this Administration
took office.
This has, indeed, been an active period.
I believe we can rightly point to some highly constructive
work toward strengthening the basic framework of the monetary
system, building on the efforts of the past.
At the same time,
events have been an ever present reminder of the unfinished
business before us -- of the need to reduce the sources of
strain and uncertainty that have given rise to a series of
speCUlative crises and, more insidiously, have worked to
jeopardize ?rogress toward freer trade and payments.
Finally
and not least important -- under the spur of these developments,
I also believe that these months have provided a useful and
needed time for the discussion and intellectual gestation of
new ideas and initiatives on both sides of the Atlantic.
- 2 -
Sources of Strain
The pressures on the international monetary system that
have become so visible in recent years grow out of a complex
combination of circumstances.
In part, the difficulties may
be traced to inadequacies and unnecessary rigidities in the
monetary mechanism itself.
To that extent, we must seek
change in the system.
However, we should also recognize that the underlying
problem may stem not so much from the nature of our international monetary arrangements, but rather from conflicts and
inconsistencies among national policies, priorities, or
circumstances external to the international financial system.
Hence, it would be an illusion to believe that any monetary
arrangements could alone eliminate the strains and tensions.
The pr(valence of inflationary tendencies in many countries
is the leading case in point.
If these are prolonged indefinitely,
confidence in national currencies will be undermined, and the
eventual result would be to call into question the basic presumptions that must underlie any stable monetary arrangements.
27r
- 3 -
The United States itself bears a particularly heavy
responsibility in this respect, because of our economic weight
and power and because our national currency is both a major
component of official international reserves and the vehicle
for conducting the bulk of the world's trade and international investment.
International banking and financial
arrangements are today inextricably tied to the dollar.
This
is reflected in the vast pool of so-called Euro-dollars traded
outside of this country -- now estimated at some $30 billion.
Foreign banks and businesses hold some $23.5 billion of
dollars within this country, and foreign governments and
central banks have over a quarter of their reserves in that
form.
In these circumstances, we simply do not have the option,
even if we desired, of starting from scratch and recasting the
monetary system in a manner in which the world escapes dependence on a stable dollar.
I can state this relationship between the health of the
monetary system and a stable dollar in another
positive -- way.
and more
Restoration of reasonable price stability
in the United States will provide a solid base from which to
deal with the other problems of the system in an orderly and
- 4 constructive way.
That is why the urgency we attach to con-
taining inflation is not solely a matter of domestic priority
but a basic ingredient in our approach toward international
monetary questions.
I do not want to suggest that the visible problems have
arisen solely from the fact that the United States, for a
period of more than three years, permitted inflation to gain
the upper hand.
Certainly, inflationary pressures in other
important countries -- in a number of cases more prolonged and
serious than in the United States -- have contributed to
currency uncertainties.
In other instances, important countries with large and
continuing trade surpluses have been slow to liberalize barriers
to imports, to eliminate special inducements to exports, or to
reach their full capabilities in terms of domestic expansion.
These actions by surplus countries -- or failure to take
appropriate action -- have impeded the process of orderly
adjustment upon which stable financial arrangements depend.
Moreover, we must recognize the problems of adjustment
and, thus, the pressures on the monetary system that arise from
essentially noneconomic factors, including the continuing heavy
- 5 -
overseas defense burden of the United States.
There are also
structural impediments to more balanced trade beyond the reach
of purely monetary adjustment, such as the border tax arrangements sanctified for many years under GATT and the discrimination implied by the growth of such customs areas as the
European Communities.
In citing these "nonmonetary" aspects of the problem, my
intent is not to suggest that we can find a fully adequate
solution apart from changes in the monetary system itself.
Indeed, it is the difficulty in achieving certain
adjustmen~s
and reconciling goals that make it imperative that we provide
a degree of elasticity and resiliency in our monetary arrangements that permits and facilitates orderly adjustment.
In the
process of seeking -- quite correctly, in my judgment -- to
remove
sour~es
of strain external to the monetary system, we
are also moving to strengthen the monetary system.
Provision for Adequate Liquidity
For several years, it has been recognized that inadequate
growth of world reserves could impair the prospects for growth
of trade and undermine financial stability.
I am glad to report
that the major nations are now prepared to move ahead in dealing
- 6 with that contingency through the conscious, multilateral
creation of a new international reserve asset -- Special
Drawing Rights.
Specifically, I anticipate that the industrial
countries making up the Group of Ten will support a proposal
of the Managing Director of the International Monetary Fund
to create a substantial amount of this new asset over the next
few years.
With this support, there is every reason to believe
the formal "activation" decision will be taken at the Annual
Meeting of the Fund in Washington at the end of next month.
"The way to this important decision has been cleared not
only by the consensus within the Group of Ten on timing and
amount, but also by the completion, late last month, of the
ratification process for the basic Amendment to the IMF Articles
establishing the SDR facility.
This required approval by three-
fifths of the membership of the Fund with 80 percent of the
voting power.
You will recall that your Committee initiated
that ratification procedure for the United States more than a
year ago and authorized United States participation in the
Special Drawing Account.
The only technical step remaining
before the Managing Director can make his proposal for activation
~y--/
- 7 is the formal deposit of instruments of participation accounting for 75 percent of Fund quotas, a stage anticipated shortly.
This activation decision seems to me important and timely
because some of the evident strains and uncertainties in the
monetary system are symptoms of a developing or incipient
shortage of international reserves.
Arithmetically, for the
world as a whole, reserve growth -- at a rate averaging only
about 2-1/2 percent a year for two decades -- has lagged far
behind the growth of international trade and investment.
This
proved tolerable in part because the United States was in a
position to withstand a sizeable loss in its own reserves,
while in the rest of the world reserves were rising at a rate
of over 5 percent a year.
Moreover, the growth in reserves was accompanied by a
rapid expansion of international credit facilities, through a
network of short-term credit lines among monetary authorities,
as well as larger medium-term conditional credit facilities in
the Fund.
This latter so-called "conditional liquidity" in
some ways supplemented "unconditional liquidity" in the form
of reserves, and the combination of the two provided resources
to finance adequately most imbalances in international payments.
- 8 However, there are limits to this process of economizing
on reserves.
Just as a superstructure of credit domestically
does not dispense with a need for growth in the internal money
supply, official credit facilities internationally -- with
their clear obligation to repay -- are not a full substitute
for acceptable international cash resources with no "strings"
attached.
There comes a point when, without a reasonable
provision for additional reserves at hand, lenders will be
increasingly reluctant to lend and borrowers to borrow.
In addition, the redistribution of reserves entailed by
the losses of the United States and the creation of new dollar
reserves through U. S. deficits could not be continued indefinitely without jeopardizing the existing arrangements.
Actually, for the past year and a half, no net additional dollars
have been provided the system through U. S. deficits, reflecting a
sustained balance or surplus in our official settlement accounts.
But, until SDR's are activated, and with new gold no longer
entering the system in significant amounts, this has left the
world with no fully acceptable means of providing reserve
growth.
In fact, nearly all recent reserve creation has been
a by-product of emergency short-term credits, mainly to the
- 9 United Kingdom and France.
In a sense, we have been creating
reserves out of crises, which hardly provides a satisfactory
basis for the longer-term evolution of the monetary system.
There is no doubt in my mind that the creation of a new
reserve asset in the form of SDR's will be a landmark in the
evolution of the international monetary system.
For the first
time, countries, acting together within the IMF, will have
taken a conscious decision to anticipate foreseeable needs by
creating reserves through collective action.
The Special Drawing Rights will be a final asset, in the
sense that there is an international commitment by participating countries to accept them, up to specified limits, as
final settlement of their international accounts.
They will
be permanent in the sense that, once created, they will remain
in existence indefinitely, unless cancelled by a specific new
decision.
In these respects, they are fully comparable to gold
and will take their place in the system side by side with gold.
The significant operational difference is that the supply of
SDR's is governed by international agreement and not by the
vagaries of gold production and competing market demands.
- 10 Obviously, there were some differences of opinion within
the Group of Ten as to the precise timing and size of the
activation of SDR's.
We are far from the stage where these
matters of judgment can be reduced to precise formula.
But
these shadings of opinion should not obscure the overriding
fact that these nations have shown themselves fully prepared
to use this new instrument decisively and forthrightly in
amounts reasonably commensurate with foreseeable needs.
At the same time, these leading countries were able to
reach full agreement to support an increase in IMF quotas in
an appropriate over-all magnitude, anticipating the regular
quinquennial review scheduled for 1970.
This review will have
to deal with many problems beyond the total amount, such as the
relationship between a general increase for all members and
selective ii1creases for countries whose relative eoonomic strength
has increased.
At a later stage, an increase in the United S'
quota may be recommended for legislative approval.
basic point is clear:
But the
we are moving in concert to assure both
the added reserves and enlarged conditional credit facilitie,
necessary to support growth in trade and other international
transactions in the years ahead.
- 11 -
This seems to me the best possible answer to those
skeptics who have felt that the world would in some way be
paralyzed in dealing effectively with the world liquidity problem
in an orderly way.
More broadly, the consensus on SDR's and
the early agreement on the general magnitude of IMF quotas
reflects the vitality of international cooperation in monetary
matters and seems to me to augur well for our capacity to move
ahead to deal with other aspects of the monetary problem.
Liquidity and the Adjustment Process
The problems of the monetary system do not fall into nice,
tight analytic compartments.
For instance, an adequate supply
of world reserves, supplemented by credit facilities that bring
resources to bear at the point of need, seems to me an essential
part of the effort to achieve a smoother adjustment process,
without resorting to a straightjacket of controls that work at
cross-purposes to the objective of a closely integrated,
c~m
petitive world economy.
Most countries, I am convinced, for fully understandable
reasons, want over time
to see an increase in their basic
- 12 international reserves, and they certainly feel more comfortable running a surplus than a deficit.
Over a period of
years, policies will tend to be biased in that direction.
But, of course, these policies will be mutually inconsistent
unless provision is made for increasing the supply of global
reserves.
In this way, the creation of SDR's should assist in
making balance of payments and reserve objectives compatible
and, therefore, contribute to a sustainable equilibrium.
To take a specific example, I suspect the task of the United
Kingdom and France in ending their deficits and in maintaining
a surplus over a period of time to repay debts and rebuild
their reserve positions would be doubly difficult if those aims
could be achieved only at the expense of the reserves of other
countries.
In that event, the countries losing reserves are likely
to react by protecting the balance or surplus in their own external
payments, forcing the deficit back on the countries least able
to sustain them.
For much the same reason, adequate reserve creation seems
to me essential if the United States is, itself, to sustain
- 13 equilibrium in its own payments.
the world economy
Because of our importance in
and because of the role of the dollar, our
freedom of action in adjusting our payments is, in important
ways, more limited than other countries.
Should we, for
instance, succeed in greatly improving our trade accounts or
in attracting capital from the rest of the world, the effects
are widely felt.
Other countries -- especially those already
in deficit or tending in that direction -- will feel compelled
to adjust their own policies to offset the consequences of our
steps.
In this process of action and reaction, our own
objectives and policies could be frustrated.
One aspect of this general problem seems to have contributed
at least marginally to the spread of high interest rates about
the world in recent months.
The strong initial impulse came
from the UnIted States, as money tightened in response to strong
inflationary pressures.
The heavy domestic credit demands
spilled over into foreign markets, mainly in the form of borrowing by U. S. banks on a short-term basis in the Euro-dollar
market.
The result was an inflow of dollars to the United
States sufficient to produce a surplus on our official
- 14 settlement accounts, but this surplus entailed a reduction in
the reserves of some European central banks.
Some of those countries, in turn, felt it necessary to
resist losses of reserves.
Consequently, they may have
tightened money in their own countries more than might have
been appropriate for domestic reasons alone or otherwise
limited flows of capital abroad.
The net result has been to
add to the pressures on the structure of international interest
rates.
Given the prevalence of inflationary pressures, it would
be difficult to maintain that this process has reached a stage
entirely out of keeping with domestic policy requirements of
most countries, but it is, nonetheless, illustrative of the
dange~
and frustrations in the adjustment process that would
be posed by a shortage of liquidity.
U. S. Balance of Payments
As I have indicated, the tightness of money in the United
States has attracted so large a volume of short-term funds as
to produce a sizeable net surplus on our official settlement
accounts; that surplus appears to amount to more than $2
billion for the first half of the year.
Over this period of
- 15 six months, Euro-dollar borrowings by our banks for use in
the United States rose by some $7-1/2 billion to a total of
more than $13 billion.
In the alternative "liquidity" measure of our balance
of payments, these short-term capital movements are counted
"below the line" as an element financing a deficit, rather til,},:
as a capital inflow.
Consequently, by that method of calculu
tion, we have recorded a very large deficit.
While we do not have all the data at hand for analyzing
the first half of the year, it is plain that neither the "liqui
dity" nor the "official settlements" measure of the balance of
payments reflects in a fully meaningful way our basic extern;,]
position.
For instance, a
l~rge
but not readily identifiaLil
portion of the liquidity deficit undoubtedly represents a divLrsion of fund3 of foreign investors, foreign subsidiaries of
!(
companies, or even U. S. residents, into high-yielding Eurodollar deposits -- funds that might otherwise have been direct}
lodged in this country.
With European branches of our own
banks actively bidding for these funds and e:l!ploying them in
the United States, part of
t-l-.
;
_ ,!
~
c
~":'t
loss is
mor~
but the "liquidity" calculation Ls distorted,
apparent than re"
Somewhat
- 16 similarly, large amounts of money shifted into Germany in May
as a hedge or speculation against the possibility of a mark
revaluation found their way back into the Euro-dollar market
and eventually to the United States -- with the same statistical
result.
While the liquidity deficit exaggerates the extent of the
problem, neither should we take too much comfort from the
surplus on official settlements.
The simple fact of the matter
is that the United States has become uncomfortably dependent
on short-term capital inflows
as a by-product of tight
money -- in maintaining external equilibrium.
The other side
of the coin -- and the measure of our problem -- is the virtual
disappearance of our traditional large trade surplus.
For the
first five years of this decade, that surplus averaged nearly
$5-1/2 billion, reaching a peak of more than $6-3/4 billion
in 1964.
By the end of 1968, the surplus had vanished, and
we have barely held our own in the months since that time.
This is one cost of the overheating and inflation of our
economy.
Imports have been sucked in from the rest of the
world at an unparalleled rate.
We look toward restoration of
- 17 a trade surplus as we regain a better balance in our domestic
economy.
But there should be no illusion that this will be
an easy task.
It is the work of years rather than months
years in which our own competitive performance must be
superior to that of our major trading partners.
Problems in the Adjustment Process
Adjustment is necessarily a two-sided process.
While we --
and the United Kingdom and France -- face a need to strengthen
our trade position, certain other countries have developed
large and chronic surpluses.
Those surpluses must be whittled
down, just as ours must be increased, to restore a sustainable
balance.
And these goals must be achieved without forcing any
country into extremes of inflation or recession that they
properly reject on domestic grounds.
Discussiuns of international monetary problems in recent
months have demonstrated a growing awareness of both the need
and the difficulties of achieving and maintaining a reasonable
equilibrium in the balance of payments of individual countries,
permitting each some latitude in pursuing their own domestic
priorities and taking account of gradual structural shifts in
- 18 competitive positions and the development of capital markets.
The essence of the problem, of course, is to achieve this
objective while preserving essential elements of stability
and continuity in the international financial system as a
whole.
It is considerations like these that have aroused
increasing interest both in this country and abroad in the
potential for various techniques for achieving changes in
exchange rates in a controlled and limited manner, within a
framework of internationally sanctioned criteria.
This is a
large and complex subject -- too large for me to attempt to
deal with today in a substantive and detailed way.
I would
only say that careful and inevitably time consuming study by
appropriate authorities would be essential to appraise the
proposals fully.
In closing, I would only re-emphasize the point with
which I started.
Changes in international monetary arrangements
are not a substitute for appropriate internal policies.
For the present, the principal contribution that the
United States itself can make to the stability of the internation
- 19 monetary system is perfectly plain -- to bring our inflation
to an end and to do so without sending shock waves of recession
to every corner of the world.
That is the main path we have
set for ourselves, and none of us should be misled into thinking that some new monetary arrangement can dispense with that
fundamental need.
--000--
rREASURY DEPARTMENT
WASHINGTON, D.C.
August 6, 1969
~R
IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by
fur two series of Treasury bills
~2,800,000,000,
or thereabouts,
Treasury bill s rna turing
Augus t
~2,802,095)000,
as follows:
this public notice, invites tenders
to the aggregate amount of
for cash and in exchange for
14, 1969,
in the amoun t 0 f
9l-day bills (to maturity date) to be issued August 14, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated
May 15, 1969,
and to
mature November 13, 1969, originally issued in the amount of
~1,300,474,000,
the additional and original bills to be
freely interchangeable.
183-day bills, for $1,200,000,000,
dated August 14, 1969,
and to mature
or thereabouts, to be
February 13, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
~S,OOO, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, August 11, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application the refor.
~
Banking institutions generally may submit tenders for account of
CUstomers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
Submit tenders except for their own account. Tenders will be received
\~ithout deposit from incorporated banks and trust companies and from
K-162
I'L'~\',)n~ibll'
and rec,)::;nizto'u ,k~llL'r..; in investment secul-ities. Tenders
!'I',)\'\ l'tlWl'S must be accumral1ied l,\' ravment of 2 percent of the face
~li~\ln.ll1t of Tn:3sury bills applied fCll-, unless the tenders are
.1l'C l'ml'anied bv an exp res s gU31- an t v l) f payment bv an incorpo loa ted bank
or trust company.
Il1Ul1C'diatel~'
after the closin~ houl-, tenders ~vill be opened at
thL' Fedel-al I{L~sel-ve Banks and Bl-anches, follmving which public announceI11l~nt \\,ill be made by the Treasul-Y Department of the amount and price
ran~e of accepted bids.
Those submitting tenders will be advised
,'[ the acceptance 01- rejection thel-eof. The Secrt'tary of the
Tt-e;1SU1-V expressl~r resel-ves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final.
Subject to these reservations, noncompetitive tenders
[or each issue for $200,000 or less without stated price from anyone
hidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance \vith the bids must be
made or completed at the Federal Reserve Bank on August l~, 1969, in
cash l"l- other immediatelv available funds or in a like face amount
l)f Tn:'asurv bills maturing August l~, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
L':--;.change and the issue pl-ice of the ne~oJ bills.
The income del-ived from Treasury bills, \-,7hether intel-est or
gail1 from the sale or other disposition of the bills, does not have
any e:--;.emption, as such, and loss from the sale or other disposition
of Treasurv bills does not have any special treatment, as such,
undet- the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise Faxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thet-eof b~r anv State, or any of the
})05sessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
\,i1l5 are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hCl-L'lll1der are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Tl'e;)SU1-\' bills (other than life insurance companies) issued hereunder
nced include in his income tax retut-n only the difference bet\-,7een
the pt-ice paid for such bills, h'hether on original issue or on
~ubsequent put-chase, and the ar.10unt actually received either upon
s;)le or redemption at maturitv during the taxable year for which the
rcturn is made, as ordinary gain or loss.
Treasurv Department Circular No. 418 (current revision) and this
Ih,tice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
! t'l"[11 any Federal Reserve Bank 050§ranch.
TREASURY DEPARTMENT
WASHINGTON, D.C.
FOR RELEASE UPON DELIVERY
Expected at 1 :30 p.m. EDT
Saturday, August 9, 1969
REMARKS BY THE HONORABLE EDWIN S. COHEN
ASSISTANT SECR~TARY FOR TAX POLICY
AT THE SECTION OF TAXATION LUNCHEON
AMERICAN BAR ASSOCIATION ANNUAL MEETING
SHERATON-DALLAS HOTEL, DALLAS, TEXAS
SATURDAY, AUGUST 9, 1969, 12:30 PM., COT
It gives me great pleasure to appear before the Section
of Taxation today to report to you about the activities of the
Treasury Department for the past few months in the development
of the Tax Reform Act of 1969, which passed the House of
Representatives two days ago.
I do so with a nostalgic recollection that a dozen years
ago in this city I appeared before this Section for the first
time as a committee chairman to urge adoption of legislative
recommendations for changes in the corporate income tax field.
I hope that by the time we meet again next August I can report
to you that at least some of thos~ recommendations, and others
that you have develoDed and adopted for the improvement of the
law,have either become law, or are well on their way to enactment.
I took offi ce on March 11. John Nolan 'joi ned us as my
Deputy on April 1 and Meade Whitaker as Tax Legislative Counsel
on July 1. As you well know from their years of work in this
Section, they are most able and dedicated men, and their
intelligence and devotion to the task made it possible for
the Treasury to respond when the long awaited,hour of tax
reform was finally at hand.
We presented the Administration's initial, or interim,
proposals for tax reform to the Committee on Ways and Means
in public session on April 22-24. We stated then that we would
formulate additional proposals in specific areas as soon as time
permitted. We have been engaged ever since in the development
of additional proposals while appearing in almost daily executive
sessions of the Committee.
K-163
- 2 -
These additional views have been presented to the Committee
informally as it took up for consideration the many topics that
were dealt with in the public hearings earlier this year, but
they have not yet taken shape as official Administration positions.
We do hope that in our public appearance on the bill before the
Senate Finance Committee we shall be able to express the Treasury's
position on each of the significant areas dealt with in the bill.
As you know, the staff of the Treasury and the Joint Committee
on Internal Revenue Taxation both appear before the Committee on
Ways and Means in its executive sessions. Dr. Laurence N. Woodworth,
the distinguished Chief of Staff of the Joint Committee, and I,
together with our colleagues on both staffs, spent many long hours
together in reviewing the many problem areas under consideration
by the Committee and endeavoring to produce a recommendation to
the Committee on which we could jointly agree. The opportunity
to work with Dr. Woodworth in these matters was one of the most
enjoyable and pleasant experiences of my career at the Bar. I
am confident that those of you who know Dr. Woodworth will appreciate
why this was so. I am happy to report that time after time we were
able, after discussion, to reconcile our views so as to colloborate
in a final recommendation to the Committee.
The almost daily sessions before the Committee were always
interesting, and the questions asked by the Committee members were
penetrating and significant. Both the chairman, Mr. [11i11s, and the
ranking Republican member, ~~r. Byrnes, constantly displayed a mastery
of the intricacies of the tax law. Their wealth of experience in
the field is a major source of strength to the Committee -- and
even more important -- to the country. The debates were vigorous,
and it was particularly gratifying to see that the subject of tax
reform was approached in an essentially nonpartisan atmosphere. I
cannot recall a single vote which was taken on party lines. While
there was necessarily division of opinion on many specific important
issues, the effort to achieve tax reform was clearly a bi-partisan
one, and I believe it will continue to be so in the Senate.
I think the Tax Reform Bill provides major improvements in the
tax structure. The Low Income Allowance, which we proposed in
April, will at a cost of only $625 million -- less than one percent
of the individual income tax revenue -- remove from the tax rolls
virtually all persons who are below the poverty level standards set
- 3 -
by the Department of Health, Education and Welfare. This means
that some five million income tax returns, which would presently
require payment of a tax,will be made wholly untaxable, and
some 7 million additional returns in the low income group will
bear a reduced rate.
There is one aspect of this proposal which may not have
received adequate public attention. In raising to $1,700 the
amount of income which a single person must have before he is
subject to federal income tax, we will have given a particularly
significant aid to students working their way through college,
for they now bear a tax of $117 at that level. Since their parents
may also retain the $600 personal exemption for the student, a total
of $2,300 of income for a working student can be freed of taxation.
Under the bill as passed a further liberalization of the low
income allowance in 1971 will enlarge its benefits further up the
scale in the low income groups.
The enlargement of the standard deduction in three stages to
raise it from 10 percent to 15 percent and to raise the standard
deduction ceiling from $1,000 to $2,000 will provide a major
simplification for some 12 million tax returns that now itemize
personal deductions. Henceforth dll those returns can be filed on
the simplified form. At present almost 32 million of the 76
million returns itemize deductions. Thus we are reducing by more
than one-third the number of returns that itemize personal deductions.
The bill gives head of household treatment to all single persons
over 35 and to widows and widowers of any age. While the principal
complaints of single persons under existing law have been with
those of individuals who maintain their own household, the difficulty
of identifying a household in the case of single persons resulted in
the decision to give this benefit to all single persons over 35,
particularly since the additional revenue difference was relatively
small. Moreover, widows and widowers maintaining households with
minor children or with children in college will be allowed to use
the joint return rates of tax without regard to the two-year limitation in existing law.
Another innovation in the bill is the topping off of the rates
on earned income at the 50 percent level. Many of the devices for
conversion of ordinary income into capital gain, and for deferment
of income, have been nurtured out of the natural desire of persons
- 4who have reached high earned income levels to avoid the burden of
very high rates. This they have attempted through participation
in ventures that produce current deductions and subsequent
capital gains, or in artificial transactions that defer the
receipt of income. For example, a man whose earnings reach the
70 percent level is in essence risking only 30 percent of his own
money and 70 percent in tax money when he enters into these ventures. By reducing the maximum rate on earned income to 50 percent,
such a person will be risking his own money to the same extent
that he is risking the tax money, thus significantly reducing
the present tendency toward artifical transactions. The successful
executive or professional man will be more inclined to concentrate
his efforts in the fields in which he is qualified and devote less
of his attention to intricate means of minimizing the effect of
high tax rates. We think the 50 percent top marginal rate on
earned income represents a substantial improvement in the law,
particularly when coupled with the many provisions which e1iminate
or curb existing tax avoidance techniques.
Since the effect of the low income a110wance and the increased
standard deduction will reduce taxes in the low and middle income
brackets, the bill as reported by the Committee provided rate
reduction in the brackets starting at $4,000 for sing1e persons and
$8,000 for married persons, topping off at a rate of 65 percent
instead of the present 70 percent.
The bi11 removes the 25 percent ceiling rate on long-term
capital gains, thus permitting the tax on capita1 gains to rise
to a maximum of 32-1/2 percent (one-half of 65 percent), since
one-half of such gains will be taken into income, as under present
law. However, under the new rate schedule the effective tax rate
on long-term capital gains will not exceed the present 25 percent
for a married person until taxable income exceeds $76,000.
It is interesting to note the difference that the tax rate
structure in the new bill would have on stock option plans or
other programs for producing capital gains rather than earned
income. At present an executive can pay tax at a rate up to
70 percent on compensation, but pays only 25 percent on capital
gains under some of the stock option plans or restricted stock p1ans.
That represents a spread of 45 points between 25 percent and 70
percent. Under the bill he would pay up to 32-1/2 percent on capital
gains but no more than 50 percent on earned income, a spread of only
17-1/2 points. Such changes might have a material impact on executive
compensation arrangements.
1 71
- 5 -
By Committee amendment after the bill was reported, a further
rate reduction in the lower and middle income brackets was given
in order to provide a minimum of 5 percent reduction to all taxpayers in the lower and middle income brackets, v/hether the taxpayer itemizes his deduction or uses the standard deduction. The
result is to give a reduction of more than 5 percent to those
using the standard deduction and to produce a $2.4 billion loss
in revenue in what was, broadly speaking, a reasonably balanced
package from a revenue standpoint when the bill was first reported.
This revenue loss will have to be considered carefully in the
light of the budgetary needs for 1971 and subsequent years.
Another factor that deserves some consideration is the
reallocation of the tax burden between corporations and individuals.
The largest revenue increase comes from the repeal of the investment
credit and other changes which bear more heavily upon corporations.
More than $5 billion of the additional revenue raised by the
bill will come from corporations and only about $1.3 billion
from individuals, almost entirely in the high income brackets.
All of the tax reductions are being given in the individual sector
and no rate reduction is provided for corporations. Many economists
may feel this involves too great an allocation of benefits to
consumption and not enough to investment in productive equipment
and capacity. Some corporate rate reduction might be useful
in the long run, particularly in permitting our American businesses
to compete overseas through export operations.
In our public presentation in April, we recommended that
the ability of some high bracket individuals to escape completely
the sharing of the burden of government be restricted by imposing a
Umit on Tax Preferences and by requiring allocations of their
nonbusiness deductions between their taxable income and their
nontaxable income. The Limit on Tax Preferences (or LTP) recognized
the fact that the income tax contains preferences designed to
stimulate investment in particular fields deemed especially important
as a matter of national policy; but at the same time it recognized
that once these preferences are written into the law, they may
be used separately or in combination by some individuals so as
to avoid completely year after year any obligation to share the
tax burden of maintaining the operations of the Federal Government.
The Limit on Tax Preferences seeks to overcome this dilemma,
without destroying the preferences, by limiting the use of these
provisions in any year to one-half of the taxpayers' income
calculated without regard to the preferences. A reasonable balance
- 6 thus is struck between the advantages to the nation in stimulating
investments of certain types and the need for insuring a fair
distribution of the Federal tax burden.
The Bill adopts this approach, but in a decision near the
end of its deliberations the Committee deleted from the list of
preferences percentage depletion in excess of cost and intangible
drilling expenses. Certainly one of the important reasons for
this deletion was the fact that the Committee had previously voted
to reduce percentage depletion on oil and gas from 27-1/2 percent
to 20 percent, as well as certain other changes with respect to
minerals, and thought it best not to take further restrictive
action at this time. Whatever the merit of the other actions taken
with respect to minerals, the deletion of percentage depletion
and intangible drilling expense from the list of preferences will
make it possible for certain individuals engaging in extensive
oil operations to continue to eliminate all income tax, despite
the continuing receipt of net economic income, through the
incentives given in the law to the mineral industry. Even if the
Bill as finally enacted reduces the percentage depletion below
27-1/2 percent, these persons will still be able to eliminate income
tax entirely if they increase somewhat their expenditures on
drilling, whether on discovery wells or development wells, and
even though the drilling produces successful wells.
I listened patiently to the complaints of many that the
Limit on Tax Preferences, if it encompassed depletion and intangibles,
would substantially mark the end of drilling operations by independent oil operators. I have asked each of these persons to suggest
some reasonable alternative that would not seriously affect the
industry, but would give to other taxpayers a reasonable assurance
that everyone who is prospering from his business shares in the
Federal income tax burden to some reasonable extent. We would
welcome any suggestions or thoughts that would provide a reasonable
solution to the problem. We are not necessarily wedded to any
particular formula, but we remain inclined to believe that the Limit
on Tax Preferences, with percentage depletion and intangible drilling
cost included among the list of preferences, is a reasonable approach.
Aside from the Limit on Tax Preferences and the allocation
of production proposals, we have been searching in these last few
months for a logical national policy related to taxation of income
from natural resources. The natural resources income tax problem
is as complex as any in the Internal Revenue Code, and it is not
solved, in my judgment at least, by slicing 27-1/2 percent to
some lower number.
- 7 -
One of the principal arguments in favor of percentage depletion
after the cost of investment has been fully recovered is that it is
needed as an incentive in development of our natural resources. If
this is true, and I am inclined to think it is true, then we might
perhaps insist that the incentive be given only to the extent that
the untaxed depletion amounts are plowed back into the development
of our natural resources -- by further exploration and development
of oil and gas wells or of any other natural resources (including
timber) or research or development of methods of discovery, recovery
or utilization of natural resources from their unprocessed form.
Under this concept, qualifying plow-back expenditures would be
limited to domestic resources except, under certain conditions, with
respect to minerals that are scarce or nonexistent in the United
States.
As part of this suggestion intangible drilling costs of
successful wells would be deductible with respect to exploration
wells but would be required to be capitalized with respect to
development wells and amortized as deductions over some specific
period no longer than ten year's, in addition to the allowance for
percentage depletion. Moreover, -geological and geophysical
expenditures, now required to be capitalized and in effect now lost
as deductions, would be allowed.
I emphasize that this is merely one possibility which \I.;e have
under consideration. In our considerations we would like to insure
that that nation gets its money's worth from the tax incentives
given, here as well as elsewhere in the tax law.
The Treasury also has put much effort in the past few months
in the development of an appropriate tax policy with respect to
real estate, beyond the inclusion of excess accelerated depreciation
in our Limit on Tax Preferences and allocations of deductions. The
Bill passed by the House embodies, in general, most of the conclusions
to which we came.
Our study of the real estate problem convinced us that double
declining balance depreciation produces an excessive allowance for
real estate construction generally, and that the allowance should
be no greater than 150 percent declining balance. Nevertheless,
with respect to housing, the goal of 26 million housing units within
the next decade, set by the Housing Act of 1968, requires some
incentives to fill this national need. Important provisions in the
- 8 -
Housing Act of 1968 relating to the construction of low and middle
income multi-family housing, per annum, were built upon the
existing income tax incentives, including double declining balance
depreciation.
We concluded, therefore, that the double declining balance
depreciation should be allowed to remain in the present tax
structure with respect to new housing construction, at least until
Congress has an opportunity to review the housing program at some
future date.
With respect to real estate in the hands of second and subsequent owners, the Bill confines depreciation to straight line.
At the same time in order to stimulate the rehabilitation of used
housing, it allows five-year amortization of expenditures for the
rehabilitation of low-cost rental housing. We believe that these
provisions in combination make it less attractive to acquire and
hold old housing for the depreciation benefits and more attractive
to rehabilitate them into modern desirable housing units.
While further changes in the real estate provisions may still
be in order, we believe that the present provisions of the Bill
in this regard move in the direction of sound policy.
There has been much interest in the changes that are proposed
with respect to contributions to charitable and educational
organizations, particularly with respect to contributions of
appreciated property. The fact that charitable contributions are
deductible on income tax returns has provided a major incentive for
private support of public charities and educational organizations
in the United States. The Treasury Department earnestly supports
the continuation of that policy. At the same time it is clear
that some abuses and excesses in the charitable contribution
field have developed in which the loss in revenue to the Treasury
and the inequity resulting in the tax structure outweigh, in our
judgment, the advantages derived by the recipient organizations.
We felt, for example, that the time had come to cut down on
the unlimited charitable contribution deduction which relieved a
number of wealthy individuals from all income tax obligations.
We thought that the privilege of deducting the full market value of
property which has appreciated in value but which, if sold, would
produce ordinary income, was excessive; but we were inclined to
- 9 -
retain the rule with respect to property that, if sold, would
produce capital gains. Excessive use of contributions of
appreciated property as a means of tax minimization is controlled
adequately through inclusion of such transactions in the Limit
on Tax Preferences and the Allocation of Deductions. I am
pleased that the Committee has, in general, followed this course
of action with respect to contributions to public organizations
and also to private foundations which funnel the amounts to
public use.
At the same time that the bill moves to close off some abuses
in the contribution area, the bill adopts the Treasury recommendation to increase the allowable charitable contribution from 30
percent to 50 percent of the donor's adjusted gross income,
although it does not permit this additional 20 percent to be given
in the form of appreciated property.
Taking all of the changes into account, we estimate that there
will be a revenue increase to the Treasury in the contribution area,
including the effect of the Limit on Tax Preferences and the
Allocation of Deductions, in the neighborhood of $100 million. On
the other hand, we estimate that because of adoption of a rule we
recommended to require private foundations to distribute to public
charity not less than five percent per annum of the value of their
assets, there will be an increase in funds flowing out of private
foundations into public charitable and educational organizations
.on the order of $200 million. Accordingly, we believe that there
will be a net increase in funds flowing into public charitable and
educational organizations.
It is interesting to note that, according to our best estimates,
some $15 billion a year flows by contributions of various kinds
into public charitable and educational organizations, including
transfers from corporations and from bequests, as well as from lifetime giving. Our statistical data taken from 1966 income tax returns
show that some $9 billion of contributions were deducted on individual
income tax returns. Of that amount about $8.3 billion, or about
92 percent, was contributed in cash. Only about 8 percent, or some
$760 million, was contributed in the form of appreciated property.
By permitting the continuation of deductions of the full value of
appreciated capital assets given to public charitable and educational
organizations, we believe there will be no significant reductions
in contributions from individuals; and the pressure applied to private
- 10 -
foundations to cause a reasonable return on their investments to
flow into public channels will actually increase the funds available
to our public charitable and educational institutions.
There are, of course, many other provisions in this 36B-page
bill. I have touched only on a few significant areas. As
Secretary Kennedy wrote to Chairman Mills, "We believe that the
bill is a milestone in tax legislation and will be long remembered
as a major advance in achieving an equitable tax structure."
Of course, the bill will have substantial analysis and
consideration before the Senate Finance Committee. Again let
me say that we earnestly solicit your comments, criticisms and
suggestions for improvement of the bill. The Section of Taxation
has been a great help in the past in assisting the Treasury and
the Congressional staffs, and I look forward to hearing the
views of the members on the Reform Bill.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 8, 1969
FOR ALL NEWS MEDIA
A preview briefing and tour of the new United States Mint.
Independence Mall. Philadelphia, Pelllsyl vania, will be conductpd
by the Bureau of the Mint, on Wednesday. August 13, 1969, at 3:00 p. m.
(The Mint will open officially Thursday, August 14th, with a
ceremony at 3:00 p. m.
Treasury Secretary David Kennedy will be
among the speakers. )
Background material and advance releases. for use in afternoon
newspapers Thursday, August 14, 1969, will be available.
The briefing
tour will include the new coin l'olling machine developed by the General
Motors Corporation for the T rCclsury Department, Bureau of the Mint.
Press credentials will admit you to the building, located on the
Mall at 5th and A rch Streets, Philadelphia.
For further information please call: Roy C. Cahoon. Bureau of
the Mint, AC 202, WO 4-5011 or EX 3-6400 through Sunday, August 10.
and AC 215-597-7350 August 11-16.
-000-
K-164
TREASURY DEPARTMENT
WASHINGTON. D.C.
August
8, 1969
FOR RELEASE IN SUNDAY NEWSPAPERS
AUGUST 10, 1969
TREASURY SECRETARY KENNEDY TO OPEN NEW UNITED STATES MINT
AT PHILADELPHIA
Secretary of the Treas ury David
, M. Kennedy will officially open the
new United States Mint in Philadelphia at a public ceremony at 3:00 p.m.
on Thursday, August 14, 1969.
Other speakers at the Independence Mall ceremony, 5th and Arch
Streets, will be Assistant Treasury Secretary Eugene T. Rossides, Mint
Director Eva B. Adams, and the Mayor of Philadelphia, James H. J. Tate.
The new Mint will be opened to the public following the ceremony.
A bronze medal commemorating the occasion will go on sale at the Mint.
The new Mint, expected to be in full operation during early 1970, is
equipped with the world s mo s t modern coin prod uction equi pment, including a
coin roller with a production capacity uf 10,000 coins per minute, as opposed to
a maximum capacity of 600 coins per minute for current equipment.
I
For the first time in history, the mint eqUipment is arranged to provide for
mechanized continuous flow through the coinage processes from virgin metals
to finished coins. This entire operation can be viewed from a glass-enclosed
elevated gallery designed to accom;~:odate 2,500 visitors an hour. A numismatic
museum containing Mint mementoes, historic coins and medals, and a sales
counter, is also available to the public.
I
Ground for the new Mint was broken on September 17 1965, and the
cornerstone was laid at a public ceremony on September 18, 1968. Total cost of
the facility will amount to approximately $39.4 million, including $1.9 million
for the land, $18.6 million for the building, architect and engineering services,
and $18.9 million for the purchase and installation of equipment developed
especially for the highly sophisticated manufacture of coins.
I
The Official Opening Medal, which will be added to the lis t of meda Is
available for purchase from the Bureau of the Mint, will be sold in two sizes:
3 inch at $3.00 and 1-5/16 inch, specially packaged for opening day, will be
$1. 50. Both will be in bronze.
K-165
- 2 -
The obverse, or front, of the medal shows the main entrance of the
Philadelphia Mint building - the lettering "United States Mint - Philadelphia August 14, 1969 - Department of the Treasury."
The reverse side has a map of the United States with 17 stars denoting
the location of mint institutions, past and present, superimposed over our
national emblem, the eagle.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
FOR DYlMEDIATE RELEASE
August 0, 1969
PRELIMINARY RESULTS OF CURHENT EXC!WIGE OFFER1JIG
Prelimina.ry figures show thnt about :$2,899 million, or 86 .l~ of the
$3,366 million Treasury notes maturing A0"ust 15 have been exchar.ged for
the new 7-3/4% Trea.sury notes.
Of the maturing notes held by the public
$2,774 million were exchanged, leaving $444 million, or 13. 8:i fc·r cas h
redemption.
Details by Federal Reserve Districts will be announced later.
K-166
2r7
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 8, 1969
FOR IMMEDIATE RELEASE
STATEMENT OF THE UNITED STATES TREASURY CONCERNTNG
THE DEVALUATION OF THE FRENCH FRANC
The action of the Government of France
in reducing the external value of the franc
represents an adjustment to economic developments
in France during the past year. The amount of
devaluation -- 11.1 percent -- is the amount
discussed when finance ministers of the group
of 10 countries met in Bonn last November. This
adjustment can be accommodated within the fram(:w(rk
of existing exchange rates.
This action will not affect the value of
the United States dollar.
000
K-167
FOR RELEASE UPON DELIVERY
STATEMENT BY THE HONORABLE PAUL A. VOLCKER
UNDER SECRETARY OF THE TREASURY FOR MONETARY AFFAIRS
BEFORE THE HOUSE COMMITTEE ON POST OFFICE AND CIVIL
SERVICE ON VARIOUS BILLS RELATING TO POSTAL REFORM
MONDAY, AUGUST 11, 1969, 10:00 A.M.
Mr. Chairman and members of the Committee, I appreciate this
opportunity to appear before you in connection with your con .
sideration of various bills regarding postal reform, including
H.R. 11750 which incorporates the President's recommendations.
While the Treasury does not have specialized knmvledge of the
personnel, rate and ratemaking, mail transportation, and other
matters covered by these bills
I expect that other witnesses
are providing expert testimony on these aspects -- we strongly
endorse the objective of creating an independent postal establishment which will be capable of conducting its activities on
a business-like basis.
The Treasury's primary interest is in the financing provisions contained in Chapter 10 of H.R. 11750, the proposed
"Postal Service Act of 1969".
These provisions were drafted
after consultation with the Treasury Department. To achieve a
truly business-like character, the proposed Postal Service will
need a degree of financial independence not now available to
the Post Office Department.
Chapter 10 would provide this
- 2 -
independence subject to continued Congressional oversight, and
would provide for advice and assistance by the Treasury
Department in the issuance of debt obligations by
the Postal
Service.
New section 1005 of title 39, United States Code, would
authorize the proposed Postal Service to borrow money and to
issue and sell such obligations as it determines necessary to
carry out the purposes of
t~
bill.
The aggregage amount of
Postal Service obligations outstanding at anyone time could not
exceed $10 billion, and the annual net increase in obligations
outstanding issued for the purpose of capital improvements would
be limited to $1.5 billion.
The legislation would require the
preparation, submission, and Congressional consideration of an
annual
business~type
budget.
As provided under new section 1006, at least fifteen days
before selling any issue, the Postal Service would be required to
advise the Secretary of the Treasury as to the amount, proposed
date of sale, maturities, terms and conditions and expected
maximum rates of interest of the proposed issue, and to consult
with the Secretary or his designee thereon.
The Secretary could
elect to purchase such obligations under such terms, including rat
of interest, as he and the Postal Service may agree, but at a yiel
no less than the prevailing yield on outstanding marketable Treasl
securities of comparable maturity.
If the Secretary does not
purchase the obligations, the Postal Service could sell
~he
obligations in
~he
market upon
- 3 consultation with the Secretary as to the date of issue, maximwn
interest rates) and other terms and conditions.
In addition to the provision for optional purchases of
Postal Service obligations by the Secretary, new section 1006
would permit the Service at its discretion to sell to the
Treasury Postal Service obligations up to $2 billion.
New
section 1007 would authorize the Secretary to use the proceeds
from the sale of public debt securities
to
purchase Postal
Service obligations.
We believe that these financing provisions are appropriate
for the proposed postal establishment, and are mindful of the
fact that similar provisions could well be adapted to other
business-like activities of the Government.
These provisions are consistent with the intent that the
debt obligations of the Postal Service meet the test of the
market.
The language prescribing the minimum rate of interest
on Treasury purchases of Postal Service obligations is designed
to preclude indirect subsidies by assuring that any borrowings
from the Treasury will be at rates not less than the current
estimated cost of money to the Government.
The Secretary's
right of first refusal to purchase Postal Service obligations
will provide the Secretary the opportunity to coordinate Postal
Service borrmvings \vith the financing of other Government activities
without interfering with the financing of essential Postal Service
- 4 activities.
The proposed authority for the Postal Service
to require the Secretary to
pur~e
a limited amount of its
obligations will help to assure timely payment of principal and
interest on Postal Service issues held by private investors and
will thus help to minimize the rate of interest required by
investors until the Postal Service is firmly established on
a businesslike basis.
H.R. 4 and H.R. 13124 would establish a Postal
Modernization Authority as an instnnnentality cf the United
States for the purposes of financing, acquiring, improving,
replacing, modernizing, and holding title to property, facilities, systems, and equipment of the Post Office Department.
The Authority would be authorized to borrow money in an aggregate amount not exceeding $20 billion outstanding at anyone
time.
The Authority would be required to obtain the approval
of the Secretary of the Treasury of the time of issuance and
the maximum rates of interest on its obligations.
The financing
provisions, however, would not authorize the Secretary of the
Treasury to purchase obligations issued by the Authority except
for interim obligations.
Thus the financing provisions would
- 5 be less flexible than under the Administration proposal,
could add needlessly to the cost of the postal system through
the payment of higher interest charges, and would not assure
proper coordination with the overall financiai program-of the
Governmen t •
The other two bills on the Committee's list, H.R. 1133
and H.R. 1134, deal only with the terms of offie e of the
Postmaster General and other top officers of che Department,
and the appointment and promotion of
pos~masters
and rural
carriers.
The Treasury Department strongly supports the President's
reccmmendations for a new Postal Service, and urges prompt
enactment of H.R. 11750.
000
TREASURY DEPARTMENT
4
WASHINGTON. D.C.
FOR RELEASE 6:30 P.M.,
Monday, August 11, 1969.
RESULTS OF TREASURY r S WEEKLY BILL OFFERWG
The Treasury Department announced that the tenders f:)r tw'-! series of' Tr~asury
bills, one series to be an additional issue 8f the bills dated May 15, 1969, and the
other series to be dated August 14, 1969, which were offered Of! Al1guSt 6, 1969, were
opened at the Federal Reserve Banks today. Tenders were i.nvited f:)r $1,61')0,0:)0,000,
or thereabouts, of 91-day bills and for $1,200,01)0,000, :Jr thereabouts, 8f 183 day
bills. The details of the two series are as fC'llaws:
RANGE OF ACCEPTED
COMPETITIVE BIDS:
High
Low
Average
91-day Treasury bills
maturing November ) 3, 1969
Approx. Equiv.
Price
Annual Rate
98.220 ~7
7.042%
98.206
7.097%
98.210
7.08li
!/
183-day Treasury bills
February 13 z 1970
Approx. Equiv.
Pric('>
Annual Rate
bl
96.3~6
7.247%
J6.290
7.298%
:~6. 3')1
7.277%
l/
maturin~
'E./ Excepting 3 tenders totaling $112,"100)
93% of the amount of 91-day bills bid for at the low price was accepted
8~ of the amount of 183-day bills bid for at the low price was accepted
~ Excepting 3 tenders totaling $215,000;
roTAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New Y'Jrk
Philadelphia
Cleveland
Richm::md
Atlanta
St. Louis
Minneapolis
Kansas City
De.llas
San Francisco
Applied For
$ 35,591,JOO
1,959,967,000
41,358,000
42,882,00:)
36,297,000
51,551,000
216,276,000
56,785,000
27,816,000
36,815,000
26,002,000
168.341,000
Acce,Eted
$" 25,126,ClOO
1,092,488,000
25, 76~3, 000
37,192,000
28,727,000
35,139,000
139,312,000
36,164,000
18, 716,000
:35,809,000
16,002,000
109,665,000
'roTALS
$2,699,682,000
$1,600,109,000
Chicago
EI
11
App lied For
$
9,142,000
1,583,349,000
22,005,000
42,570, 0')0
12,741,000
43,101,O'JO
148,211,000
37,935,000
16,770,000
21,904,000
25,321,000
165.247.000
£1
$2,128,296,000
Accepted
~
9,142,000
81 9,349,000
12,004,00~
42,170,000
12,141,000
30,5'1g,OOCl
97,Of)i),00Cl
25,5:S5,000
12,270,000
21,904,000
15,321,000
102,617,000
$1,200,038,000 ~/
Includes $395,473,000 noncompetitive tenders accepted at the average price Df 98.21
~ Includes $217,009,000 noncompetitive tenders accepted at the average price of 96.30
These rates are on a bank discount basis. The equiyalent c~~pon issue yields are
7.31~ for the 91-day bills, and 7.66~ for the 183-day bills.
3-0 1...-UNITED STATES SAVINGS BONDS ISSUED AND REDEEMED THROUGH July 31, 1969
{Dollar amounts in mi lIions - rounded and will not necessarily add to totals}
DESCRIPTION
--
AMOUNT ISSUEDlI
---.----
---
-----
MATURED
s!'ri('~
AMOUNT
REDEEMEDlI
A- U135 thrll D-19-11 _ _ _ _ _ _
Fund G- 1()4 I t hfll 1952
51'ries J and K-1952 thru 1957 ___
S"flPS
AMOUNT
OUTSTANDINGlI
-------
" ' OUTSTANDING
OF AMOUNT ISSUE.D
----
-------
5,00)
29,521
3,754
4,996
29,482
3,719
7
38
35
.13
.93
1,883
8,312
13,372
15,604
12,264
5,563
5,279
5,461
5,392
4,714
4,077
4,271
4,878
4,972
5,180
5,003
4,710
4,593
4,303
4,312
4,366
4,205
4,690
4,572
4,470
4,811
4,766
4,503
1,448
1,666
7,366
11,884
13,774
10,653
4,655
4,263
4,319
4,182
3,603
3,119
3,243
3,617
3,615
3,708
3,536
3,264
3,051
2,786
2,679
2,547
2,374
2,473
2,418
2,335
2,319
2,153
1,678
206
218
946
1,488
1,830
1,611
909
1,016
1,141
1,211
1,111
958
1,028
1,261
1,356
1,472
1,468
1,446
1,$42
1,516
1,633
1,819
1,8)1
2,217
2,154
2,135
2,492
2,613
2,825
1,242
11.58
11.38
11.13
11. 73
13.14
16.34
19.25
20,89
22.46
23.57
23.50
24.07
25.85
27.27
28.42
29.34
30.70
33.57
35.23
37.87
41.66
43.54
47.27
47.11
47.76
51.80
54.83
62.74
85.77
653
971
-318
-
162,627
118,457
44,170
27.16
5,485
7,101
3,404
1,718
2,080
5,383
37.92
75.81
12,586
5,123
7,463
.14
UNMATURED
SI'rirs E JJ :
19-11_
HH2
1943
19H ______
I(H5
1946
1947
1948
I ~)40
1950
1951
1952
1953
1954
1955
1956
1957
1958
1;'5D
1%0
1%1
1%2
I
I
,
I
-- -
\%1
1964
1965
1966
1%7
1%8
1%9
[fnc lassifi ed
Total SHies E
Sl'rir<; H (1952 thru May, 1959) J/
H !.Jime, 1959 thru 1969)
T"tal Series H
--
/---------- ---
-
Tl)tal Series E and H
f
Inrtllrl!-s
Total unmatured
Grand Total
....
01',
123,580
-
51,633
29.47
38,277
175,213
213,491
38,198
123,580
161,778
80
51,633
51,713
rUf'd dlf.1counf.
(.I"r"flt rf'dpnll'( I -.n
59.30
--
Total matu"d
All Sl'rips
175,213
--
value.
Atf)Pflcm of otA:ner bond,,:; may be held Bnd will earn interest for additional periods RIter oriRitJal maturity dBtpS.
Form PO 3812 (Rev. Apr. 1969) - TREASURY DEPARTMENT - Bureau of the Public Debt
.21
29.47
24.22
---
TREASURY DEPARTMENT
WASHINGTON. D.C.
/~
,,9-/7)
August 13, 1969
FOR RELEASE AT·"! ;,.H.
WEDNESDAY, AUGUST 13, 1969
PRESIDENT NIXON'S REVENUE SHARING PROPOSAL
FACT SHEET
The Revenue Sharing Plan
These are the major characteristics of the Administration's
revenue sharing proposal:
1. It is simple o It is set up to work without the need
for any new Federal agency or- bur-eau. The oper-ation
is spelled out clearly and specifically in the law
(the ~ill will be sent up shor-tly); the money is
distributed on the basis of census data and otherr-eadily available objective statistics.
2. It has no strings. The state and local gover-nments
are free to exercise their own discretion over- the
use of the funds. There are no Feder-al "str-ings"
tied to the money.
3. It is automatic. The states and localities can
count on the r-evenue sharing in their- own fiscal
planning. The money for revenue sharing is
automatically available each year. The annual amount
is geared to the growing personal income tax base of
the nation.
4. It is fair-. The funds go to ever-y State, every city,
and every county in the Nation. All areas are
included -- urban and rural, large and small, r-ich
and poor, industrialized and agr-icultur~.
K-l68
- 2 -
5. It is neutral. The state-by-state distribution is
based primarily on where people reside. The
allocation among the governments within a state is
based on the existing distribution of financial
responsibilities among the various units of
government, as decided in each area.
6. It is basic to the New Federalism. Decision-making
power over the funds as well as the money itself is
returned to state and local governments.
Summary of the Revenue Sharing plan
The revenue sharing plan has four major features.
1. The size of the fund to be shared is a stated
percentage of personal taxable income -- the base
on which Federal individual income taxes are
levied. To ease the budget impact, the fiscal year
1971 percentage is only 1/6 of one percent
($500 million); in subsequent fiscal yea~ there are
phased increases to a permanent one percent in the
fiscal year 1976 ($5 billion estimated yield).
20 The distribution among states is made on the basis
of each state's share of national population,
adjusted for the state's revenue efforto Thus, a
state which taxes its citizens more than the
national average will receive a proportional bonus.
3. The distribution within states to the general units
of local governments is established by prescribed
formula. The portion a state must share with its
political subdivisions corresponds to the ratio of
total local general revenues to the sum of state
and total local general revenues in the state.
The amount which an individual unit of general local
government receives corresponds to its share of all
local general revenues raised in the state.
4. The only requirements imposed on the states (in
addition to the local sharing) are (a) quarterly
reporting and accounting and (b) maintenance of
existing state aid to localities.
- 3 -
Questions and Answers on
The Administration's Revenue Sharing Proposal
1.
Q. What is the purpose of this proposed legislation?
A. The ultimate purposes are many:
to restore to the states their proper rights
and roles in the Federal system with a new
emphasis on local discretion;
to provide both the encouragement and the
necessary resources for local and state
officials to exercise leadership in solving
their own problems;
to narrow the distance between people and
the government agencies dealing with their
problems;
to restore strength and vigor to local and
state governments;
to achieve a better allocation of total
public resources.
In short, our purpose is to build a streamlined
Federal system with a return to the states, cities,
and communities of the decision-making power
rightfully theirs.
2.
Qo How much money is to be shared?
A. The size of the total fund to be shared will be
a stated percentage of personal taxable income -the base on which Federal individual income taxes
are levied. To provide for an orderly phase-in
of this program, the FY 1971 percentage will
be 1/6 of one percent, or about $500 million; with
subsequent fiscal year percentages being increased
annually up to a permanent one percent for fiscal
year 1976 and thereafter. On this basis, we
estimate an appropriation for fiscal 1976 of about
$5 billion.
- 4 3.
Q. Can the states and localities depend on this flow
of funds to be regularly appropriated?
A. In order to provide for the assured flow of Federal
funds, a permanent and indefinite appropriation will
be authorized and established for the Treasury
Department, from which will be automatically disbursed
each fiscal year an amount corresponding to the
stipulated percentage.
4.
Q. How will the funds be distributed?
A. The funds will be distributed from the Federal
Treasury to the 50 states and the District of
Columbia. Each state will receive an amount
based on its share of national population, adjusted
for the state's revenue efforto The revenue effort
adjustment is designed to provide the states with
some incentive to maintain (and even expand) their
efforts to use their own tax resources to meet
their needs. Revenue effort is defined as the
ratio of total general revenues collected by
state and local governments in a given fiscal year
to the total personal income of that state. A
simple adjustment along these lines would provide
a state whose revenue effort is above the national
average with a bonus above its basic per capita
portion of revenue sharing.
5.
Q. Will the states be required to share some of this
distribution with their local governments?
A. The allocation of a state's share among its general
units of local government will be established by
prescribed formula. First, the proportion which
a state will share with its local governments will
be determined. This will correspond to the ratio
of total local general revenues to combined state
and local general revenues, in the state. Second,
the distribution of this local share among the
various units of local government within the state
will then be determined o The proportion which an
individual unit of general local government will receive
will correspond to the ratio of its own revenues to
total local government revenues in the stq.teo
- 5 -
6.
Q. Why are these particular distribution formulas used?
A. Distributions based on revenues raised have several
important advantages:
they make allowance for state-by-state
variations;
they tend to be neutral with respect to the
current relative fiscal importance of state
and local governments in each state;
they provide a method for allocating among
government units with overlapping
j urisdic tions.
7.
Q. Does a state have any opportunity to use some other
distribution procedures than those just outlined?
A. Yes. In order to provide local flexibility, each
state -- working with its local governments -- is
authorized to develop an alternative distribution
plan.
8.
Q. What restrictions or qualifications will be imposed
on the use of these funds?
A. There will be no program or project restrictions
on the use of these funds. One purpose of revenue
sharing is to p~rmit local authorities the
programming flexibility to make their own budget
allocation decisions. Each state will be required
to meet minimum reporting and accounting requirements.
9.
Q. How do the various state, county, city and other
local officials view this revenue-sharing proposal?
A. We have had numerous discussions with governors,
mayors, and county officials about the essentials
of this proposal. There has developed a remarkable
degree of approval on its key measures. At our
July 8 White House conference on revenue sharing,
for example, the various representatives of state
and local governments reached broad agreement on
all the program's major features
0
- 6 10.
Q. How much of a new administrative apparatus will be
required to administer revenue sharing?
A. None. The plan has been designed to operate almost
automatically, avoiding any requirement for the
establishment of any new Federal bureau or agency.
The whole purpose is to avoid Federal controls and
to increase the fiscal discretion available to
state and local governments.
- 7 ESTIMATED FUNDING FOR REVENUE SHARING, 1971-76
Fiscal
Year
Taxable 1/
Income Base
(In billions)
Percentage for
Revenue Sharing
'l:../
Funds for Revenue
Sharing
(In billions)
1971
$315
2/12 of 1%
1972
346
5/12 of 1%
1.5
1973
381
7/12 of 1%
202
1974
419
9/12 of 1%
3.2
1975
461
11/12 of 1%
4.2
1976
507
1%
5.1
l/
$0.5
The 1971 base is taken as calendar year 1967 taxable
individual income
0
The base is assumed to grow at the rate of 10 percent a year.
~/
The full-year amount will be paid out over the last two
quarters for fiscai year 1971.
TREASURY DEPARTMENT
Washington
FOR RELEASE P.M. NEWSPAPERS
THURSDAY, AUGUST 14, 1969
REMARKS OF THE HONORABLE DAVID M. KENNEDY
SECRETARY OF THE TREASURY
AT THE DEDICATION OF THE PHILADELPHIA MINT
PHILADELPHIA, PENNSYLVANIA
THURSDAY, AUGUST 14, 1969 AT 3 P.M.,EDT
One of the pleasant privileges of membership in
President Nixon's Cabinet is that every so often I have an
opportunity to be a part of history in the making -- and this
time and place are historic for many reasons.
We are here to open the fourth United States Mint to be
built in Philadelphia, the first seat of our Nation's
government. And this amphitheater is just a few hundred feet
from the site of the first United States Mint, where
President George Washington, on a similar occasion in 1792,
handed over some of his wife's household silver for a test run
of the new facility.
I am told that President Washington gave Martha the first
experimental coins as a souvenir, but I still wonder whether
she really believed she got the best of the bargain. For, you
see, that the first Mint made nothing but one-cent and halfcent coins. And even at 1792 prices, you couldn't buy many
table settings for pennies.
Two other distinguished American women are closely and
warmly connected with this occasion. They are both with us
today, and despite tradition, we are NOT asking them to
donate the family silver. They are, of course, Miss Eva Adams,
the present Director of the Mint, under whose direction this
Mint was designed and built, and Miss Mary Brooks,
Director-Designate of the Minto
K-169
- 2 -
3//
We have come a long way since Martha Washington sacrificed
her silver to history. One year after the first United States
Mint was dedicated here in Philadelphia, it had managed to
turn out only 144,126 coins. That was quite a record for
18th Century coin-making, but it represents about 8-1/2
minutes' production for this marvelous new facility we have
here today.
The new Philadelphia Mint is the largest, the most
modern, and undoubtedly the most efficient plant of its kind
in the world. It can produce 1 million coins an hour, or
300 every second -- and we need it to meet efficiently and
economically the coinage needs of our expanding society.
This facility exists in good part thanks to the legislative
efforts of Congressmen Tom Steed and Sylvio Conte.
Whe;l the fit'st Hint was established in 1792, the population
of the entire United States was only four million. Today, we
number nearly 200 million, and the Census Bureau tells me that
at the present rate of growth we will have a population of
close to 365 million by the beginning of the 21st Century.
Thus, in a little over 200 years, the American nation will
have increased its population almost a hundred-fold, with a
national wealth estimated in trillions, rather than billions,
or millions of dollars.
I am sure that the distinguished mint masters from other
countries who are our guests here today will agree that a
tremendous and cons tant flov7 of coinage, such as this new
Mint will provide, is vital and basic to commerce, and, in
addition, an adequate supply of coin is essential to feed the
machines of trade which are multiplying in this advanced
technological society.
There is something stimulating, to me at least, about a
bright, newly-minted coin. I suppose it's because I sometimes
wish we could mint national policy as readily as we mint new
coinso We might then call in all our old thoughts, our old
programs, our old ways of action, run them through the smelter
and re-issue them, sparkling, fresh, and new.
Unfortunately the problems of national security, economic
stability, the promotion of human welfare and the enhancement
of our environment, do not lend themselves to mintage
solutions
0
- 3 Lacking a solution machine, we must turn to our own
all-too-human talents and resources. We have to evaluate
the Nation's past commitments, which are demanding larger
shares of our resources, and, at the same time, try to find
answers to new problems that arise inexorably. Oe cannot
simply cast aside our old problems and commitments and turn
all our attention to the new, and even with all of our
bountiful resources, we cannot perform in one grand sweep
all the desirable tasks that wait to be done.
Today, this Nation and a new national administration
are deeply immersed in forming public policies which will
affect the lives of all our citizens for many years to come.
My prime concern as Secretary of Treasury is the economic
health of the Nation, and I have observed over the years that
Secretaries of the Treasury win very few popularity contests,
because very few people associate economic health with taxes.
President Nixon said recently that "we shall never make
taxation popular," and, for one, do not intend to try, but
I would count it a major victory if even a bare majority of
Congress and the public were to accept the hard fact that
taxation and economic stability are two sides of the same coin.
You just can't have one without the other.
But we are making progress. Only yesterday, Congress
recessed after enacting important legislation which clearly
demonstrates the relationship between taxes and stability.
The Congress has taken an essential and timely step j_n
extending the 10 percent income tax surcharge. Had that tax
been allowed to die -- and there were some who thought that
would be a popular move -- nearly $10 billion would have been
pumped into our overheated economy and the inflationary fire
would have gotten that much hotte~.
The people's elected representatives in Washington are
to be strongly commended for refusing to let the surtax die.
A majority of the Congress set aside political considerations
and voted squarely in favor of the long-term interest of all
Americans.
Now, while the Senate extended the surtax for only
six months because some of its leaders felt that further
extension should await meaningful tax reforms, I believe the
Senate will ultimately join with the House in extending the
surtax for the full period requested by the President.
- 4 I say this because meaningful tax reform is now in sight.
Just last week, building upon recommendations of the
Administration, the House overwhelmingly approved a reform bill that
is the most far-reaching since our system of income tax was
established more than a half-century ago. And I believe that
when the whole bill is acted upon by the entire Congress, full
extension of the surtax will accompany the reforms.
The reform measure is proof positive that an administration
of one party can work effectively with members of the other
party in the Congress in meeting pressing national needs. The
16 substantive tax reform proposals which President Nixon
transmitted to the Congress last April provided the basis for the
bill. The President's proposal for a limitation on tax
preferences -- that's our version of the so-called "minimum
income tax" -- was adopted with some modifications. Mr. Nixon's
Low Income Allowance proposal, which in 1970 will remove more
than 5 million poverty-level citizens from the tax rolls, and
reduce taxes on 7 million others, was also adopted.
Recently, there has been speculation that the Tax Reform
Act of 1969, when it emerges from the Congress, will be
labeled a "Democratic" or a "Republican" bill. Neither label
would be correct. This is the people's tax bill -- drafted
and enacted by a strong bipartisan majority, with the full
cooperation of the Administration. Where fairness and tax
equity are concerned, there can be no party lines.
The Administration is going to suggest that certain changes
be made in the Tax Reform Bill in the Senate. In some areas,
it does not go far enough. Certain changes made by the House
in President Nixon's tax preference proposal would permit many
millionaires to go right on paying little or no federal income
taxes. Furthermore, on balance, the bill as it now stands
may go too far in reducing needed revenues.
Everyone welcomes lower taxes. But there is a point
at which too deep a slash in federal revenues could perhaps force
retrenchment in important domestic programs and even increase
the already severe inflationary pressures -- which, in the
long run, would cost all of us much more than any temporary
gain we might get through tax reductions.
In the first half of this year, the consumer price index
rose at an annual rate of nearly 6-1/2 percent. This is an
intolerable inflation. If allowed to continue, it would halve
the value of the dollar in a little more than 11 years. Nothing
- 5 -
even remotely resembling that can be allowed to happen.
Instead, the economy must gradually be brought onto a noninflationary course and held there. This means there must be
a tight rein on federal spending in the immediate future, and
a suitable degree of monetary restraint.
President Nixon on July 22 ordered a $3.5 billion
rollback in federal spending to help cool off the overheated
economy. He said at that time that no federal program is beyond
scrutiny, that some highly desirable programs will have to be
stretched out and others reduced. And a policy of monetary
restraint by the Federal Reserve System has been in effect since
late last year. There are indications that these policies are
beginning to pay dividends.
But the fact remains that we must guard against the
potentially dangerous impact in later years of the tax cuts
that have now been enacted.
Even if the surtax is extended through June of next year,
as the President has recommended, there will still be
substantial revenue losses showing up in the 1971 fiscal year
and thereafter.
To say that we are concerned over some of the long-term
fiscal effects of this bill and that we will ask for changes
in the Senate version, is not to detract from the fact that this
reform measure is a milestone in tax legislation. The
bipartisan House Ways and Means Committee, under the able
leadership of Chairman Wilbur Mills and ranking Republican
John Byrnes, with key assistance from Hale Boggs, added a
number of constructive measures to those proposed by the
President in April. The proposals for tax relief which will
benefit so many Americans were worked out by Treasury
officials and the Committee staff and were accepted by the full
Ways and Means Committee. Finally, they received overwhelming
approval by the House.
Now it is up to the Senate. I cannot urgetoo strongly that
our Senators, Republicans and Democrats alike, proceed with the
same determination the House has shown. Enactment of this bill,
with the modifications this Administration will recommend, will
be a giant step toward making taxation, if not popular, at least
fair for all our citizens.
- 6 -
Finally, I should like to congratulate all of you who
have had a part in the building of this great city's fourth
United States Mint, and to thank those of you who have joined
fuemin making the occasion a memorable one. The artisans and
craftsmen of Philadelphia, as they have for nearly 200 years,
will continue to provide us with the coin of commerce and
trade, and all of us, with the help of the Lord and an assist
from the Senate, will work together to keep it sound.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 13, 1969
FOR IMMEDIATE RELEASE
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,800,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing August 21, 1969,
in the amount of
$2,804,614,000,
as follows:
91-day bills (to maturity date) to
in the amount of $1,600,000,000,
or
additional amount of bills dated May
mature
November 20,1969, originally
$1,300,740,000,
the additional and
freely interchangeable.
be issued August 21, 1969,
thereabouts, representing an
22, 1969,
and to
issued in the amount of
original bills to be
182-day bills, for $1,200,000,000,
dated August 21, 1969,
and to mature
or thereabouts, to be
February 19, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, August 18, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec'imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-l70
- 2 responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announc~
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on August 21, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing
August 21, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
TREASURY DEPARTMENT
!
WASHINGTON. D.C.
August 14, 1969
FOR RELEASE A.M. NEWSPAPERS
FRIDAY, AUGUST 15, 1969
TREASURY DEPARTMENT STATEMENT ON
SECOND QUARTER BALANCE OF PAYMENTS
The Department of Commerce release on the balance of payments
for the second quarter reveals a deficit of $3,792 million on a
liquidity basis, and a surplus of $1,249 million on an official
settlements basis, both seasonally adjusted. The difference
between these two measures of the deficit thus widened to
.$5,041 mill ion.
As the Commerce data show, the major factors which
statistically explain this large discrepancy between the two
measures of the deficit are:
(a) the very large volume of short-term borrowing
by u.S. banks from the Euro-dollar market;
this is counted as a capital inflow under the
official settlements concept but not the
liquidity measurements; and
(b) a substantial run-off of "special" financial
transactions -- involving a reduction of over
$500 million in medium-term investments by
foreign monetary authorities, which affects the
liquidity balance but not the official settlements
measurement.
In testimony last week before the Subcommittee on
International Finance of the House Committee on Banking and
Currency, Paul A. Volcker, Under Secretary for Monetary Affairs,
commented on the balance of payments:
"The tightness of money in the United States
has attracted so large a volume of short-term
funds as to produce a sizeable net surplus on our
official settlement accounts; that surplus
appears to amount to more than $2 billion for the
first half of the year. Over this period of
K-171
- 2 six months, Euro-dollar borrowings by our banks
for use in the United States rose by some $7-1/2
billion to a total of more than $13 billion.
"In the alternative 'liquidity' measure of
our balance of payments, these short-term capital
movements are counted 'below the line' as an
element financing a deficit, rather than as a
capital inflow. Consequently, by that method of
calculation, we have recorded a very large
defic it.
"While we do not have all the data at hand
for analyzing the first half of the year, it is
plain that neither the 'liquidity' nor the
'official settlements' measure of the balance of
payments reflects in a fully meaningful way our
basic external position. For instance, a large
but not readily identifiable portion of the
liquidity deficit undoubtedly represents a
diversion of funds of foreign investors, foreign
subsidiaries of U.S. companies, or even U.S.
residents, into high-yielding Euro-dollar
deposits -- funds that might otherwise have been
directly lodged in this country. With European
branches of our own banks actively bidding for
these funds and employing them in the United
States, part of this loss is more apparent than
real, but the 'liquidity' calculation is
distorted. Somewhat similarly, large amounts of
money shifted into Germany in Mayas a hedge or
speculation against the possibility of a mark
revaluation found their way back into the Eurodollar market -- and eventually to the United
States -- with the same statistical result.
"While the liquidity deficit exaggerates the
extent of the problem, neither should we take too
much comfort from the surplus on official
settlements. The simple fact of the matter is
that the United States has become uncomfortably
dependent on short-term capital inflows -- as a
by-product of tight money -- in maintaining
external equilibrium. The other side of the
- 3 -
coin -- and the measure of our problem -- is the
virtual disappearance of our traditional large
trade surplus. For the first five years of this
decade, that surplus averaged nearly $5-1/2 billion,
reaching a peak of more than $6-3/4 billion in 1964.
By the end of 1968, the surplus had vanished, and
we have barely held our own in the months since
that time.
"This is one cost of the overheating and
inflation of our economy. Imports have been
sucked in from the rest of the world at an
unparalleled rate. We look toward restoration of
our trade surplus as we regain a better balance
in our domestic economy. But there should be no
illusion that this will be an easy task. It is
the work of years rather than months -- years in
which our own competitive performance must be
superior to that of our major trading partners.
"Adjustment is necessarily a two-sided
process. While we -- and the United Kingdom and
France -- face a need to strengthen our trade
position, certain other countries have developed
large and chronic surpluses. Those surpluses
must be whittled down, just as ours must be
increased, to restore a sustainable balance. And
these goals must be achieved without forcing any
country into extremes of inflation or recession
that they properly reject on domestic grounds.
"Discussions of international monetary
problems in recent months have demonstrated a
growing awareness of both the need and the
difficulties of achieving and maintaining a
reasonable equilibrium in the balance of payments
of individual countries, permitting each some
latitude in pursuing their own domestic priorities
and taking account of gradual structural shifts in
competitive positions and the development of
capital markets. The essence of the problem, of
course, is to achieve this objective while
preserving essential elements of stability and
continuity in the international financial system
as a whole.
320
- 4 "It is considerations like these that have
aroused increasing interest both in this country
and abroad in the potential for various
techniques for achieving changes in exchange rates
in a controlled and limited manner, within a
framework of internationally sanctioned criteria.
This is a large and complex subject -- too large for
me to attempt to deal with today in a substantive
and detailed way. I would only say that careful
and inevitably time consuming study by appropriate
authorities would be essential to appraise the
proposals fully.
"In closing, I would only re-emphasize the
point with which I started. Changes in
international monetary arrangements are not a
substitute for appropriate internal policies.
"For the present, the principal contribution
that the United States itself can make to the
stability of the international monetary system is
perfectly plain -- to bring our inflation to an
end and do so without sending shock waves of
recession to every corner of the world. That is
the main path we have set for ourselves, and none
of us should be misled into thinking that some
new monetary arrangement can dispense with that
fundamental need."
000
4;L1
TREAS Ll F~ Y 0 E P 1\ R "r rv'i E r\! l~
--.--
..
__
~~=~(£. ~~.F.M!'.~""r""1'~!:r:~~~4~~~E~..:.~~~..:r.~r.:.".·$'.~p:
.
..... ,~.;~';'f,..{t~-f.:~;.:)r;-;:::-::~·7,:'~···=A;:-::·~;~,"t:~~:,:-:·:,,;~,:~·::::~r'":n;~
:::
....
-"_.-._--....
..
-----~- .... .........,-" ...~--'"---.-.--- ........
..."'.
-
-
FOR n.rr1EDIATE RELEASE
AUgl~st
14, 1969
TREASURY BILL OFFERING OF $2.1 BILIJION
The Treasury announced today that a total of $2.1 billion vdll be added
to seven outstanding weekly series of Treasury bills.
mature September 18 to October 30, 1969, inclusive.
'll'nese aTe the series which
They will be reopened in
the amount of $300 million each -- a total of $2.1 billion.
The auction vrill be on Wednesday, August 20 "with payment on Monday, August 22
In this "stripll offering, subscribers "rill put in for equal cUllounts of each of thE
seven series of bills being reopened.
Commercia~
banks may make payment of their
o\om and their customers' accepted tenders by credit to 'l'reasur.f tax a..n.d 10a..n.
accounts.
K-172
--.-...l'.k·.::
...
..-r=.~"i"·.~
'.~".
:. :'I'.
..., .. "'~ ...
-.--~"
-.--------.,---........
",.,..
.
•
-~
.......
-..
-,....
..........,....,-.....
"
._
".,,'
.~-,.~
......
~':_\: _~._' _ •
-.. ..,. ... ~',
''"'''.~.,.
..... .....
'
_.........
....'." ';
--.
. , ......, .....
"
.,
'''Jr. c' I;' 1\f(:T()~'IIJ,I
'V
, ...~. I I I '. ~I
FOR IMi.ffiDIATE RELEASE
..
'.
-.-,....~.,.-
.
.,~
r~) iF>
~"
/,
;'.-)
...
• '1,."
:.
•
'"
,J
'
August 14, 1969
TREASURY GFFERS $2.1 BILLIGn S'I'}UP GF HEEKLY BILLS
The T'l'easury Department, by this public notice, invites tenders for addi tionaJ,
amounts of seven series of Treasury bills to an, ag,e;regate aUlouIlt of $2,10.0.,0.0.0.,0.00,
or thereabouts, for cash. Tne addi tioDEl,l bills 'liill be issued l'.ugust 25, 1969, vTill
be in the amounts, and ,'Jill be in addition t.o the bills originally issued and
maturing, as follO'.'rs:
,Amount of
Mditional
Issues
$
300,000,000
300,000. , GO.O
3()0 ,000 ,000
300!000,000
300,000 ,000
300,000 ,000
300,000,00.0.
l2,100 ,000,000
Griginal
Issue Dates
1969
lilarch
l':arch
April
A:9 ri1
April
Anril
Nay
20
27
3
10
17
24
1
Maturity
Dates
1969
Se:9terr..ber
Se:9teL'lber
October
October
Gctober
Gctober
October
Days from
August 25, 1969
to 1·1aturi t~l
18
?r'
~,:)
2
9
16
23
30
Average
-
24
31
38
45
52
59
66
·15
Amcmnt
Currently
OutstE'vndinz
(in milliol'ls
$2,701
2,701
2,70.1
2,701
2,70.3
2,70.3
2, "10.1
The additional and original bills '..rill be freely interchangeable.
Each tender submitted mus t be in the aTIount of 107,000, or an even mill tj'-Dle
thereof, 8:O.cl or.e-S8-.rentt. of -:~e ClT'J.0 1_LYJ.-S tendered ~G.l.l De a~.ie·i to eacD 0: ~l~e 3.80-I-e
series of bills.
The bills offered hereunder "trill be issued on a discolLTlt basis uIlder coy:rpeti ti
and non~om]eti tive bidding as hereinaf"cer procrided, EL"ld at v.a:t'..:ri ty their face ?J)1.:r"t
will be payable 'tTi thcut interes t. :::':'1e:/ ,;dll be issued in oearer form o[l~=r, and in
denominations of :31,000, $5,0.00, $10,000, $-50,00.0, ,3100,000, 25GO.!000 ani ,~1,OOO!O~2
(maturi ty value).
Tenders -frill Qe Y~2ei.\red 9..t ?-::'ieI'al .2ese::-,~{e 3a:-J.:s- 2..~i ~r2.!l2hes u~ ~o t~e ~los2.
hour, cne-~l::~yt~/- i?:1., ~as'~ern ='a:.-lig:_~ Sa:r=-~~g ~~=s, ~'[ecL~~Sc.8..~/ ;-'''':3:~S~ 2<:1,2..9=9.
Tenders ~{ill not be rece.~ "':led at t~.:.e ~~2. . sl1:r:,r Je~·a!"-:::-.:::.e::~ ~ ~\i-2..SI:~~S-:·o::~
In. -::-~e S2..32 ~... ..:'
competitive -:en.ders -;:,he ~r2.ce oi'feTe~5_ :~u3t"be e}~-.;;:ressecL on the basis of lCG~ ~·:-=-t~1 :::Jt
more thaIl three dec::Lr.tals, e.g., 99.925. F'ractions I:'lay not be used. A single :;Jri~e
must be submitted for each UIlit of $7,0.00, or eyen multi:9le theTeof. A lJ.Ylit re:9rese-r:
$1,000 face a'!'. .ount of ea~h issue of bills offered hereundsr, as ?reviously descri'8ecl.
It is urged that tendeTs be made on the :9rinted £":JrC!'.s and fonn::ried in t:ce speci8,J_
envelopes \{hich "rill be sUfplied by Federal ?eser-re 3an..'-:.s ar~d 3ra::lcnes en e,:;::;;l:;,c2otior
therefor.
Banking institutions generally may suomit tenders for account of custor:lers :9::'0vided the n2:c.es of the ~ustomers are set forth in such tenders. Others th3.n ba:(1~in6
insti tutions will not, be :g ermi tte,i to submit ter:ders except for their O';i:1 accou...n.t.
lenders will he. rec~eiveci without deposit from incorporated ban~s and tr"J.st cor.:'callies
2
(1f p:<,-
-',I
llillt; c' '.
c'
('
'j-,
. .'- - -- "
~.
J:
•. ~
I
f •••
CJ_l~''-~ 5_ !"1..-=.~
,'"ie
I" ',~1: c':
v"i,:l1 L,.c
(."
~":::LCJ~OCl'J
'\1111 1:1:::
'.
:.1_,
-','
C' ",
'-I.~
C'1.'
.,'
~"~'_~v~C~'l
::..r~
,
C
~.
-:..
__ '0
i
I
i~ ~.
,
.=-':LC> !..-'c~2·..:.-)('~~:-v
0:.'
IJ
..-, "
,
:;~~'_)]J_
}J:::;~: (:i,n e-')-'~~:'l :.'uJ,tillJes
(:CCC)G',:(I, j
~l :CLl.l
2G ttl2
O_,n ~"7 ,0(0) -,::i_thu:'G SG".tr=l 'pj':i,cc fn'Ll:r\;' (1:",: b:(]
c',";2:~o,::>:; 'c::ic,: (L'1 "C:~::';:<; 6c.c:>",12) o:i' 8(:C:2':;:,:c:,~ c,', '"
,
-;
0
'-"--"-' -; .,-' .....
\".! ..... "
T,"3.)e
~1
,
v:_'
-~<~(t"'L.a
.j
c
(~
c:.t
I I
~.{ '-' -
... '
0.-,1
C'<'::l C'l'
0),,-::.]1
:COl'
U!1J.2l~
.
t02
,
,
CG~;'0 '::.'~r~ ~ ~<~
::,f ~
......- • -.J __
-'
3 , .'-• r~l.
~- . ' \ - "
.JI__ ::"
"'
_. .' --\_'-:::.
-.-,.-::'
;
.-'
:--
,.
.~--
-
'..,)--"
-,.-".
-
,~-
.'''':'''
:.. ::.
---
::::~
~~.
0"
'.
--
.~)
.....
..-
:... I~~-:::~.~, no::..
.)
-'
-'
--,'.....- --------
c"_
~_
-. ".'-:....
.~
_'-' --.vc.. ,___-..... -' _,----.
:'
-.." j
\
,-
-~...:..
.:
.-.
.j
-- ....
..... _C'2":':" ,-~ ::-::::S",-:: -
....
= ___ '--.
-,-.
-
_./'-
,....., ,- - - ...... ___' _.'-.. --,"":::I
~
"vi',:
TREASURY
DEPARTMENT
*
302-3
*i.
LWiA6Q • •
==
WASHINGTON, D.C.
FOR IMMEDIATE RELEASE
August 15, 1969
SUBSCRIPTION FIGURES FOR CURRENT REFUNDING
In the Treasury's current exchange offering of 7-3/4% notes dated
August 15, 1969, maturing February 15, 1971, open to holders of $3,366
million of notes maturing August 15, 1969, subscriptions totaled $2,933
million, leaving $433 million, or 12.9%, for cash redemption.
Of public
holdings amounting to $3,218 million, a total of $410 million or 12.7%
was unexchanged.
Subscriptions by Federal Reserve Districts were as follows:
Federal Reserve District
Amount Exchanged
Boston
$ 118,605,000
New York
Philadelphia
1,369,921,000
86,286,000
Cleveland
190,604,000
Richmond
75,608,000
Atlanta
132,686,000
Chicago
385,174,000
St. Louis
128,213,000
Minneapolis
62,430,000
Kansas City
133,325,000
Dallas
San Francisco
Treasury
Total:
K.. 174
87,832,000
142,358,000
19,689,000
~2,932,731,000
3::2-,/
TREASURY DEPARTMENT
WASHINGTON. D.C.
FOR RELEASE 6: 30 P.M.,
Monday, August 18, 1969.
RESULTS OF TREASURY r S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated May 22, 1969, and the
other series to be dated August 21, 1969, which were offered on August 13, 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
or thereabouts, of 91-day bills and for $1,200,000,000, or thereab::mts, of 182-day
bills. ~e details of the two series are as follows:
OF ACCEPTED
COMPETITIVE BIDS:
~
High
Low
Average
!I
Y
182-day Treasury bills
maturi!!fj Februa!l: 19 z 1970
Approx. Equiv.
Annual Rate
Price
-7-:O91~
96.415
96.388
7 .145~
96.400
7.121~
1/
!I
Excepting one tender of $5,000
:J1, of the amount of 91-day bills bid for at the low price was accepted
85~
rom
91-day Treasury bills
November 20z 1969
Approx. Equiv.
Price
Annual Rate
98.280
6.804~
98.255
6.903~
98.267
6.856~
maturin~
of the amount of 182-day bills bid for at the low price was accepted
TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Phllade 1phia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
1811as
San Francisco
'roTALS
Acce12ted
AP12lied For
$ 28,958,000 $ 18,958,000
1,069,189,000
1,899,039,000
23,439,000
38,439,000
40,678,000
42,708,000
18,539,000
19,539,000
43,566,000
45,566,000
156, 872, 000
186,872,000
53,771,000
56,226,000
20,817,000
21,817,000
27,918,000
27,919,000
17,348,000
24,348,000
109.007,000
135,377,000
$2,526,808,000
$1,600,102,000~/
Applied For
$
7,508,000
1, 673, 272, 000
20,786,000
26,349,000
22,029,000
37,223,000
136,912,000
50,097,000
16,361,000
23,546,000
25,532,000
127.341,000
Acce12ted
$
7,208,000
873,515,000
10,436,000
26,199,000
15,229,000
28,523,000
75,520,000
46,597,000
8,986,000
22,076,000
15,432,000
70.741.000
$2,166,956,000
$1,200,462,000 ~
s!Includes $347,019,000 noncompetitive tenders accepted at the average price of 98.21
£IIncludes $207,908,000 noncompetitive tenders accepted at the average price of 96.4
!/Tbese rates are on a bank discount basis. The equivalent coupon issue yields are
7.07~ for the 91-day bills, and 7.4~ for the 182-day bills.
TREASURY DEPARTMENT
WASHINGTON. D.C.
PUR REIEASE 6::30 P.M.,
~esday, August 20, 1969.
RESULTS OF OFFERING OF $2.1 BILLION STRIP OF TREASURY BILLS
The Treasury Department announced that tenders tor additional amounts of seven
series of Treasury bills to an aggregate amount of $2,100,000,000, or thereabouts,
to be issued August 25, 1969, which were oftered on August 14" 1969, were opened at
the Federal Reserve Banks today. Tbe amount of accepted tenders will be equally
divided among the seven issues of outstanding Treasury bills maturing September 18,
September 25, October 2, October 9, October 16, October 2:3, and October :30, 1969. The
details of the offering are as follows:
Total app lied for - $:3, 727,:3:3 9, 000
Total accepted
2,100,000,000
RABGE OF ACCEP'IED
COMPETITIVE BIDS:
High
Low
Average
4~
row.
Price
99.346
99.284
99.:307
(includes $89,572,000
entered on a noncompetitive basis and accepted in full at
the average price shown below)
Approximate equivalent annual rate 8f disc8unt
based on 45 da s avera
number of da s to maturi t
5.2:32
5.728~
5.544~
11
of the amount bid for at the low price was accepted
TENDERS APPLIED FOR AJID ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New10rk
Phllade Iphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
I811as
San Francisco
TOTALS
Applied For
$ 1:39,895,000
1,886,871,000
229,971,000
271, 061, 000
74,956,000
95,921,000
:376,159,000
85,6:31,000
190,995,000
68,257,000
129,325,000
178,297.000
Accepted
$ 83,895,000
786,478,000
180,971,000
257,061,000
66,430,000
89,411,000
224,959,000
70,021,000
14,8, 995,000
66,157,000
45,:325,000
80.297.000
$:3,727,3:39,000
$2,100,000,000
~is rate is on a bank discount basis.
!(- 17~
The equivalent coupon issue yield is 5.66~.
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
WASHINGTON. D.C.
August 20, 1969
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,800,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing August 28,1969,
in the amount of
$2,802,134,000,
as follows:
92-day bills (to maturity date) to be issued August 28, 1969,
in the amount of $1,600,000,000,
or thereabouts, representing an
additional amount of bills dated May 29, 1969,
and to
mature November 28,1969,
originally issued in the amount of
$1,300,016,000,
the additional and original bills to be
freely interchangeable.
182-day bills, for $1,200,000,000,
or thereabouts, to be
and to mature February 26, 1970.
dated August 28, 1969,
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Ranks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Monday, August 25, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even mUltiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"ima1s, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
Customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-176
-
L
-
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unlesl the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, foll~ing which public announc
ment will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Sec~tary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without .tated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or comple.ted at the Federal Reserve Bank on August 28, 1969, in
cash or other immediately available funds or in a like face amount
of Treasury bills maturing August 28, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
WASHINGTON. D.C.
August 20, 1969
TREASURY'S MONTHLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$1,700,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing August 31, 1969,
in the amount of
$1,706,008,000,
as follows:
271.day bills (to maturity date) to
in the amount of $500,000,000,
or
additional amount of bills dated May
mature May 31, 1970,
originally
$1,000,225,000,
the additional and
freely interchangeable.
be issued September 2,1969,
thereabouts, representing an
31, 1969,
and to
issued in the amount of
original bills to be
365-day bills, for $ 1,200,000,000,
or thereabouts, to be
dated August 31, 1969,
and to mature August 31, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty p.m., Eastern Daylight Saving
time, Tuesday, August 26, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"imals, e. g., 99.925. Fractions may not
be used o (Notwithstanding the fact thit the one-year bills will run
for 365 days, the discount rate will be computed on a bank discount
basis of 360 days, as is currently the practice on all issues of
Treasury bills.) It is urged that tenders be made on the printed forms
and forwarded in the special envelopes which will be supplied by
Federal Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customer. provided the names of the customers are set forth in such
tenders. Otherg than bankin~ institutions will not be permitted to
K-177
- 2 s~bmit tenders except for their own account. Tenders will be receivel
w1thout. deposit from i~corporated b~nk~ and trust companies and from
Lespons1ble and recogn1zed dealeLs 1n 1nvestment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
OL trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announe
ment will be made by the Treasury Department of the amount and price
Lange of accepted bids. Those submitting tenders will be advised
of the acceptance or rejection thereof. The Secmtary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tenders
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on September 2 1969 in
cash or other immediately available funds or in a like face ~ount '
of Treasury bills maturing August 31, 1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 0oO~ranch.
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 20, 1969
FOR RELEASE A.M. NEWSPAPERS
THURSDAY, AUGUST 21, 1969
DECISION MADE ON JAPANESE DICHLOROBENZIDINE
DIHYDROCHLORIDE UNDER ANTIDUMPING ACT
The Treasury Department announced that a determination
has been made that Dichlorobenzidine Dihydrochloride (also
known as DCB) manufactured by Wakayama Seika Industry
Company, Ltd., Wakayama, Japan (Wakayama Seika Kogyo Co., Ltd.,
Wakayama, Japan) is not being, nor likely to be sold at less
than fair value within the meaning of the Antidumping Act
1921 as amended (19 U.S.C. 160 et
~.).
A tentative determination was published in the Federal
Register on June 28, 1969.
This notice allowed 30 days for
the submission of written views or requests for an opportunity
to present views orally.
No submissions or requests were
received.
During the period May 1, 1968 through June 30, 1969
dichlorobenzidine Dihydrochloride (also known as DCB) valued
at approximately $325,000 was imported from Japan.
000
K-178
TREASURY DEPARTMENT
WASHINGTON, D.C.
August 20, 1969
FOR RELEASE A.M. NEWSPAPERS
THURSDAY, AUGUST 21, 1969
DECISION ON POTASSIUM CHLORIDE
MADE UNDER ANTIDUMPING ACT
The Treasury Department announced today that potassium
chloride, otherwise known as muriate of potash, from Canada,
France, and West Germany, is being, and is likely to be, sold
at less than fair value within the meaning of the Antidumping
Act, 1921, as amended.
Notices of the determination and the case references to
the Tariff Commission will be published in the Federal
Register.
During the period August 1, 1967, through December 31,
1968, potassium chloride valued at approximately $35,000,000
was imported from Canada; during the period July 1, 1967, through
December 31, 1968, potassium chloride valued at approximately
$2,300,000 was imported from West Germany; and during the period
July 1, 1967, through August 31, 1968, potassium chloride
valued at approximately $1,450,000 was imported from France.
000
K-179
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
WASHINGTON. D.C.
August 25, 1969
TREASURY'S WEEKLY BILL OFFERING
The Treasury Department, by this public notice, invites tenders
for two series of Treasury bills to the aggregate amount of
$2,BOO,000,000, or thereabouts, for cash and in exchange for
Treasury bills maturing September 4,1969,
in the amount of
$2,B02,014,000,
as follows:
9l-day bills (to maturity date) to
in the amount of $1,600,000,000,
or
additional amount of bills dated June
mature December 4,1969,
originally
$1,301,356,000,
the additional and
freely interchangeable.
be issued September 4,1969,
thereabouts, representing an
5, 1969,
and to
issued in the amount of
original bills to be
1B2-day bills, for $1,200,000,000,
dated September 4, 1969,
or thereabouts, to be
and to mature March 5, 1970.
The bills of both series will be issued on a discount basis under
competitive and noncompetive bidding as hereinafter provided, and at
maturity their face amount will be payable without interest. They
will be issued in bearer form only, and in denominations of $1,000,
$5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour~ one-thirty p.m., Eastern Daylight Saving
time , Friday, August 2~, 1969.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three dec"imals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Banking institutions generally may submit tenders for account of
customers provided the names of the customers are set forth in such
tenders. Others than banking institutions will not be permitted to
submit tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
K-1BO
-
L -
~esponsible
and ~ecognized deale~s in investment securities. Tenders
f~om othe~s must be accompanied by payment of 2 pe~cent of the face
amount of T~easu~y bills applied for, unless the tenders are
accompanied by an express gua~anty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at
the Federal Reserve Banks and Branches, following which public announc
ment will be made by the Treasury Department of the amount and price
~ange of accepted bids.
Those submitting tenders will be advised
of the acceptance o~ rejection thereof. The Secretary of the
Treasury expressly reserves the right to accept or reject any or all
tenders, in whole or in part, and his action in any such respect
shall be final. Subject to these reservations, noncompetitive tender
for each issue for $200,000 or less without stated price from anyone
bidder will be accepted in full at the average price (in three
decimals) of accepted competitive bids for the respective issues.
Settlement for accepted tenders in accordance with the bids must be
made or completed at the Federal Reserve Bank on September 4, 1969, i
cash or other immediately available funds or in a like face amount
of Treasury bills maturing September 4,1969.
Cash and exchange
tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in
exchange and the issue price of the new bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject to
estate, inheritance, gift or other excise taxes, whether Federal or
State, but are exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to be
interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills are
sold, redeemed or otherwise disposed of, and such bills are excluded
from consideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between
the price paid for such bills, whether on original issue or on
subsequent purchase, and the amount actually received either upon
sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision) and this
notice prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank 060~ranch.
33/
TREASURY DEPARTMENT
WASHINGTON. D.C.
FOR RELEASE 6: 30 P.M.,
August 25, 1969.
~ay,
RESULTS OF TREASURY I S WEEKLY BILL OFFE RING
The Treasury Department announced that the tenders for two series of Treasury
bills, on: series to be an add1ti8nal issue ~f the bills dated May 29, 1969, and the
other serles t:) be dated August 28, 1969, WhlCh were :)ffered on August 20, ] 969, were
opened at the Federal Reserve Banks today. Tenders were invited f'Jr $1,600,000,0'::)],
or thereabouts, of 92-day bills and for $1,200,000,000, or thereab:ll:ts, oJf 182-day
bills. The details of the two series are as follaws:
RANGE OF ACCEPTED
COMPETITIVE BIDS:
High
:'ow
Average
92-day Treasury Bills
November 28 z 1969
Approx. Equiv.
Price
Annual Rate
7.012%
98.208 ~
98.176
7.137'"
98.186
]J
7.098'"
maturin~
182-day Treasury Bills
maturins February 26, 1970
Approx. Equ:iv.
Price
Annual Rate
96.328 'E.!
7.263~
96.298
7.323~
96.313
7.293~
~/
bl
~ Excepting 2 tenders t:ytaling $102, 000;
Excepting 2 tenders t:ytal1ng $10,000
93~ :)f the amaunt of 92-day bills bid f~r at the low price was accepted
5CYfo of the amount of 182-day bi 11s bid for at t.he low price was accepted
rroTAL TENDERS APPLIED FOR AND ACCEPTED BY FEDERAL RESERVE DISTRICTS:
District
B::st;)n
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Fran(:isco
'roTALS
rj
AcceEted
A12Elied For
$ 36,910,000 $ 26,910,000
1,149,874,000
1,817,974,000
24,5')8,000
39,608,000
43,590,000
43,590,000
J.3,618,000
1.:"1,618,000
4 A ,'330,OOO
49,770,000
11 () , 892, 000
153,092,000
38,:153,000
4:3, 953, 000
1::,,962, 000
18,712,000
33, 741,0C)0
33, 742,00a
15,766,000
25, 766,00a
82,134,00'J
130,5:"54,000
$2,413,269,000
AEElied For
8, 72 7 ,000
$
1,677,889,000
19,693,000
27,363,00 0
17, 034, (}]O
31,857,000
132, 166, O()O
23,649,00'J
18,755,000
29,239,000
20,435,000
AcceEted
$" 7,577,000
235,656,OaO
855, l3::1, 000
9, 6. l :3, 000
2 7 ,082,000
1.6,971,000
17, 747,0C)0
89,530,000
18, 54~?, 000
7,255,000
23,R01,000
10,435,000
115, 447, 000
$1, 6(lO, 078, 000 ~I $2,242,463,00J
$1,200,226,'J:]0
Includes $.336.725,000 n::mcompetitive tenders accepted at the average price :)f
'lp"
d/
I
r.r
~ Includes $181,848,000 noncompetitive tenders accepted at the average price of 96.313
II
These rates 3re on a bank diGcJunt basis. The equivalent cJup0r. issue yields are
., _~~<j, for the 92-day bills, and 1. 68~ for the 182-day bills.
TREASURY DEPARTMENT
WASHINGTON. D.C.
FOR RELEASE 6: 30 P.M.
Tuesday, August 26, 1969.
RESULTS OF TREASURY'S MONTHLY BILL OFFERING
The Treasury Department announced tha.t the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated May 31, 1969, and the
other series to be dated August 31, 1969, which were offered on August 20, 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $500,000,000,
or thereabouts, of 271-day bills and for $1,200,000,000, or thereabouts, of 365-day
bills. The details of the two series are J,S follows:
RANGE OF ACCEPI'ED
COMPETI TIVE BIDS:
High
Low
Average
271-day Treasury bills
maturing May 31, 1970
Approx. Equiv.
Price
Annual Rate
94.478
7.335%
94.414
7.421%
94.439
7.387%
!I
365-day Tre:j3Hry bills
maturing August 31, 1970
Approx. Equiv.
Price
Annual Rate
7.300~
92.599
92.531
7 . ~ 67 %
92.558
7.340%
92% of the amOlmt of 271-day bills bid for at the low price
3% of the amount of 365-day bills bid for at the low price
1,'18:::;
Wl.8
3.ccepted
accepted
TOTAL TENDERS APPLIED FOR MID ACCEPrED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
TOTALS
y
EI
U
Applied For
$ 10,961,000
1,421,929,000
12,272,000
8,598,000
8,107,000
18,317,000
259,516,000
20,452,000
9,984,000
5,356,000
12,009,000
194,239,000
AcceI2tcd
9Gl,000
$
775,9:::;,000
500,019,000 ~ $1,981,740,000
$1,200,Ou8~000
Ap}21ied For
787,000
$
1,022,022,000
8,916,000
1,707,000
5,799,000
10,541,000
103,146,000
5,547,000
9,385,000
1,672,000
11,171,000
131,494,000
Acce}2ted
787,000
$
315,502,000
3,916,000
1,707,000
1,799,000
2,393,000
73,146,000
5,047,000
1,385,000
1,672,000
1,171,000
91,494,000
$1,312,187,000
$
2,ZT ,000
7,098,000
3,100,000
5,032,000
223,516,000
13,51?,000
1,984,000
5,356,000
2,009,000
158,739 , (,GO
':2../
Includes $17,983,000
noncompetitive tenders accepted at the average price of 94.,1
Includes $56,912,000
noncompetitive tenders accepted at the average price of 92.5
These rates are on a bank discount basis. The equivalent coupon issue yields aTe
7.83% for the 271-day bills, and 7.89% for the 365-day bills.
K-181
TREASURY DEPARTMENT
WASHINGTON, D. C.
FOR RELEASE UPON DELIVERY
Expected at 3:00 p.m., EDT
Wednesday, August 27, 1969
REMARKS OF THE HONORABLE MURRAY L. WEIDENBAUM
ASSISTANT SECRETARY OF THE TREASURY FOR ECONOMIC POLICY
BEFORE THE NATIONAL CONFERENCE OF STATE LEGISLATIVE LEADERS
ST. LOUIS, MISSOURI
WEDNESDAY, AUGUST 27, 1969, 2:00 P.M., CDT
TOWARD A NEW FISCAL FEDERALISM
When President Nixon first outlined the principles of
his domestic program on April 14, he described one of this
country's more pressing needs:
"If there is one thing we know, it
is that the Federal Government cannot
solve all the Nation's problems by itself;
yet, there has been an over-shift of
jurisdiction and responsibility to the
Federal Government. We must kindle a
new partnership between government and
people, and among the various levels of
government."
The need for such a new partnership was never stronger
than it is today.
apparent.
The evidence of "over-shift tt
1S
readily
Just to catalog the current domestic programs of
the Federal Government now requires a book of more than
600 pages.
In retrospect, it is quite clear that this large flow
of power from the private sector and from the cities and
states to Washington did not just happen of its own accord.
K-182
- 2 It was induced initially by economic crises.
It was further
stimulated by mobilization for major war and the threat of
major war.
It has been accelerated by a variety of efforts
of the Federal Government to cure major domestic ills through
the power of Federal programs and Federal money.
Yet for all this emphasis on the assumed power and
influence of our national Government, the limits to its
effectiveness have become all too apparent.
Too often,
Federal funds have been wasted or used inefficiently.
Too
often, a bountiful promise has been followed by a lack of
performance.
Too often, the application of some centrally
formulated regulation has failed to accommodate the diversity
of local situations.
The result has been some erosion of
public confidence in the Federal Government's ability to
serve as a truly effective instrument of social progress.
State and local governments are, in some cases, better
able to deal with these problems.
experienced rapid growth.
These governments have also
Indeed, since World War II, their
expenditures, employment, and indebtedness have increased
significantly faster than those of the Federal Government.
Yet the services the public has expected them to provide
education, transportation, health, and many more -- have often
been beyond the capacity of local public resources to finance
and hence to deliver.
- 3 -
The Federal Government has not been oblivious to the
needs of state and local governments.
Federal grants-in-aid
to states and localities will pass the $25 billion mark this
fiscal year -- up from $7 billion in 1960.
This type of
program or categorical assistance has represented an
increasing portion of both total Federal outlays and state
and local revenues.
accompanied
But, too often, it has also been
by an ever growing maze of program restrictions,
formulas, matching provisions, project approval requirements,
and a host and variety of administrative burdens.
The result
has been the creation of a complicated network of intergovernmental assistance efforts with many inefficiencies and
unworkable features.
This Administration intends to correct the inefficiencies
and inflexibilities of the present system while assisting
the states and localities in a more substantial way than in
the past.
The need for such assistance can be clearly
demonstrated.
Public finance experts of all political
persuasions have noted that under the existing income tax
structure Federal revenues increase faster than the national
economy, while Federal expenditures for current programs
(except in wartime) are likely to rise more slowly.
reverse is true for states and localities.
The
Their revenues,
based heavily on sales and property taxes, do not keep pace
with the rate of national economic growth.
In contrast,
- 4 their expenditure requirements for existing programs tend
to rise far more rapidly.
The resulting "fiscal mismatch"
of potential Federal surpluses and state-local deficits is
the financial basis for Federal aid.
This is not a partisan point that I am making.
The
"fiscal mismatch" has been noted by analysts of all political
persuasions.
In preparing the Administration's revenue
sharing plan, we carefully reviewed the literature on the
subject.
I was personally struck by the widespread support
for introducing a new and broader type of Federal financial
aid to state and local governments -- support by Democrats
as well as Republicans, liberals as well as conservatives,
academic experts as well as political leaders, and big city
dwellers as well as smalltown residents.
The challenge, then, is to redesign our system of
intergovernmental assistance to achieve the results we
all desire:
a better allocation of total public resources,
more responsiveness in public institutions,
more control over local events by local
authorities,
greater program and budget flexibility
for locally-elected officials,
more efficient, less encumbered forms
of Federal assistance.
- 5 -
The President has accepted this challenge.
On August 13,
he proposed to the Congress fundamental revisions in both the
spirit of our intergovernmental relations and the substance
of our intergovernmental assistance system.
As he put it,
we are seeking to build a "New Federalism," with a return to
the states, cities, and counties of the decision-making
power rightfully theirs.
At the heart of this effort is the
proposal for sharing Federal revenues with the state and
local governments.
Revenue sharing can provide both the
encouragement and the resources for local and state officials
to exercise leadership in solving their own problems.
I want to take this opportunity to outline in some detail
the essential elements of our revenue sharing proposal.
I
find it most helpful to describe it within the framework of
four major questions.
First, how do we determine the total amount to be
shared?
We propose to establish a permanent appropriation,
automatically determined each fiscal year, which will
provide revenue sharing funds equal to a stated percentage
of personal taxable income -- the base on which Federal
individual income taxes are levied.
To provide for an
orderly phase-in of this program, the fiscal year 1971
percentage is one-sixth of one percent, or about $500 million.
- 6 -
Subsequent fiscal year percentages increase annually up
to a permanent one percent for the fiscal year 1976 and
thereafter.
On this basis, we estimate an appropriation
for the 1976 fiscal year of about $S billion.
We think
that it is important to make a start soon, rather than
waiting until the budget permitted a larger program.
A five-year transition is a desirable approach for a brand
new activity.
Like most revenue sharing proposals, our plan uses
aggregate personal taxable income as the base for computing
the shared amount.
This tax base has the advantages of
relative stability, steady growth, and independence from
tax rate changes.
Furthermore, it insures the taxpayer
that state and local officials will not become advocates
for higher Federal tax rates in order to gain revenue
sharing funds.
Second, how are the funds distributed among the states?
We propose a distribution based on each state's share of
national population, adjusted for the state's revenue effort.
The revenue effort adjustment is designed to provide the
states with some incentive to maintain, and even expand,
their efforts to use their own tax resources to meet their
needs.
Revenue effort is defined in the customary fashion
the ratio of total general revenues collected by a state and
all its local governmental units during a given fiscal year
- 7 -
to the total personal income of that state.
A simple
adjustment along these lines provides a state whose
revenue effort is 10 percent above the national average
with a 10 percent bonus above its basic per capita portion
of revenue sharing.
One important point about revenue effort should be
noted:
It is a relative and not an absolute measure, since
revenues collected are expressed as a percentage of personal
income for each state.
It does not, therefore, reward
"wealthy" states -- that is, those states with high average
income levels.
Indeed, some of the wealthier states on a
per capita income basis have relatively low revenue efforts,
and some of the poorer states have high revenue efforts.
In a direct way, the revenue effort provision rewards those
states that try harder to meet their own needs with their
own resources.
The state-by-state distribution is primarily determined,
then, on a per person basis, with revenue effort added as a
mi nor adj us tment .
(To compute a s ta te I s share
0
f
the revenue
sharing fund, the arithmetic is quite straightforward:
one
simply computes the product of that state's population times
its revenue effort and divides the result by the sum of the
products so computed for alISO states and the District of
Columbia. )
- 8 Our proposal does not contain a so-called "equalization"
provision, whereby low-income states receive more per person
than high-income states.
We have found, in the course of
many discussions with state and local officials, that
variations in state per capita income are simply not a good
measure of need.
In fact, many of our most urgent domestic
problems are found in the urban centers of the states with
high per capita income.
Therefore, we have chosen to keep
the distribution among states as neutral as possible, basing
it primarily on population.
Third, how are the funds distributed within each state?
Including local governments in Federal revenue sharing is a
relatively new idea.
We spent more time trying to perfect
the local "pass-through" than on any other part of the
revenue sharing plan.
You cannot use a simple per capita
distribution among local governments because of the
overlapping jurisdictions of cities and counties.
You cannot
use a measure of "need" because there are no adequate
statistics on income levels by city and county.
This is the approach that we did come up with:
We
propose that each state share a given proportion of these
funds with its local governments.
The allocation of a
state's payment among its local governments is carefully
prescribed by formula.
First, the total proportion which a
state shares with its local governments corresponds to the
ratio of general revenues raised by
t~ese
local governments
to the combined total of revenues raised by the state and
- 9 -
all its units of local government.
Second, the proportion
of this local share which an individual unit of general
government receives corresponds to the ratio of its own
general revenues to total general revenues raised by all
general-purpose local governments in the state.
There are some features of this local distribution which
deserve emphasis.
For one, we are proposing to share
revenues with all general-purpose local governments -- cities,
towns, and counties
governments.
and only general-purpose local
There is no minimum-size requirement for a
locality to participate, and no special or school districts
are eligible for direct sharing.
These features are fully
consistent with the spirit of the New Federalism and the
purposes of revenue sharing.
That is, all general governments
should be included, and no program or project restrictions
should be placed on the funds.
To have distributed dollars
directly to fire districts, or school districts, or drainage
districts would have amounted to widespread earmarking of
substantial funds for specific programs.
Our desire is to
avoid that and to leave such budget allocation decisions up
to the responsible state and local officials.
It may be useful to analyze how the local pass-through
would operate.
Limiting eligibility to general-purpose
local governments has an important impact on the other key
feature of the local distribution formula
allocation of
funds on the basis of general revenues raised.
A distribution
- 10 based on revenues raised has several important advantages:
it makes allowance for state-by-state variations; it tends
to be neutral with respect to the current relative fiscal
importance of state and local governments in each state;
and it provides a method for allocating among governmental
units with overlapping jurisdictions.
By sharing funds only
with municipalities, counties, and townships, the state
government portion of revenue sharing is enlarged by the
relative proportion of special and school district revenues
to total revenues.
This result has a direct effect on potential state and
local allocations of revenue sharing funds to particular
programs and projects.
In those areas where the functions
elsewhere performed by a special-purpose district or a
school district are carried on directly by a general-purpose
government, then that government's portion of revenue sharing
will be enlarged by the proportion of its revenues that it
raises for such functions.
Therefore, those officials
responsible for managing and administering the special
functions involved will look to the general-purpose local
government for any additional funds.
On the other hand, if
a special-purpose or school district exists independent of
the local government, then the state government's portion of
revenue sharing will be enlarged by the proportion of total
revenues that are raised by these districts.
In these cases,
- 11 the officials responsible for managing and administering
such districts will look to the state government for
additional assistance.
By this distribution procedure,
the Federal revenue sharing program avoids directing or
influencing the allocation of funds to particular governmental
functions.
Such allocation decisions will be made by state
and local officials in response to the needs of their
jurisdiction.
There is another important point which should be made
regarding the allocation of funds on the basis of revenues
raised.
Some observers have jumped to the conclusion that
such a distribution procedure rewards the wealthy suburb at
the expense of the central city.
generalization.
This is simply not a valid
Revenue sharing funds go to local governments
in proportion to their share of general revenues raised, not
in relation to the income level of their residents.
We are
unable to find evidence to support a contention that suburban
governments raise more revenues per capita than urban
governments.
instances.
In fact, the reverse is true in many specific
For example, New York City raised $404.81 per
capita in general revenues in 1967-68 (the latest figures
available), while New Rochelle raised $152.55 and Mount Vernon
$121.89.
For all cities of one million or more, the average
per capita revenues were $255.95, compared to $78.74 for cities
with population of less than 50,000.
- 12 One final point about our proposal for distribution
of funds within each state deserves mention.
In order
to provide local flexibility, we will permit a state
working with its local governments -- the option of
developing an alternative distribution plan.
Any alternative
plan, however, must receive sufficient support from both the
state and the local governments, large and small.
The fourth major question is:
What restrictions or
qualifications are imposed on the use of revenue sharing
funds?
I have already expressed our determination that
these funds should have no program or project "strings"
connected with their use.
A fundamental purpose of revenue
sharing is to permit local authorities the programming
flexibility to make their own budget allocation decisions.
This purpose is basic to the spirit of the New Federalism:
a return to the states and localities of their rightful
powers and responsibilities.
The requirements we propose are minimal:
(1) that the
states carry out the requirement to share funds with their
local governments; (2) that this local sharing be in
addition to current sharing efforts; and (3) that all
recipient governments provide a reasonable amount of
informational reporting to the Treasury Department for
the funds they receive.
- 13 -
We welcome the thoughts of state and local governments
on how best to implement these general concepts.
We have had
the benefit of numerous helpful suggestions from governors,
mayors, county executives, legislators, academic experts, and
other interested parties.
In preparing this specific proposal,
we have attempted both to draw on past efforts and to go beyond
them.
I believe that the Administration's revenue sharing plan
contains several important improvements over some of the
earlier proposals:
(1) it includes local as well as state
governments, and (2) it leaves to the state and local governments the decision as to how to allocate the funds among
programs and activities.
wisdom.
However, we claim no monopoly on
We welcome further suggestions and advice.
I would like to conclude by citing what I believe are
the most advantageous characteristics of the Administration's
revenue sharing plan.
It is simple.
No new Federal bureau or agency
is needed; the funds are distributed on the basis
of readily available objective statistics, as
clearly specified in the plan.
None of the
Federal revenue sharing money is to be used for
"overhead" or other expenses by the Federal
Government.
It is automatic.
State and local governments can
count on the funds in their own fiscal planning.
- 14
The money for revenue sharing is automatically
available each year and is geared to the growing
personal income tax base of the Nation.
It is fair.
The funds go to every state, every
city, and every county in the Nation.
All areas
are included -- urban and rural, large and small,
rich and poor, industrialized and agricultural.
It has no strings.
The state and local governments
are free to exercise their discretion over the use
of the funds.
Decision-making authority, as well
as money, is returned to state and local governments.
It is neutral.
The state-by-state distribution is
based primarily on where people reside.
The alloca-
tion among governments within a state is based on
the existing distribution of financial responsibilities among the various units of government, as
decided in each area.
President Nixon's call last April for a new partnership
among the various levels of government has received an enthusiasti
response from many quarters.
of such a partnership.
Revenue sharing is an integral part
It is a program which has long enjoyed
bipartisan professional and political support.
measure of its merit.
That is the
Its enactment will represent an important
step toward establishing a more effective and better working
Federal system of Government.
000
TREASURY DEPARTMENT
WASHINGTON, D.C.
FOR RELEASE UPON DELIVERY
Expected at 1:00 p.m. EDT
Thursday, August 28, 1969
REMARKS OF THE HONORABLE MURRAY L. WEIDENBAUM
ASSISTANT SECRETARY OF THE TREASURY FOR ECONOMIC POLICY
BEFORE THE JUNIOR BANKERS DIVISION OF THE
ARKANSAS BANKERS ASSOCIATION
LITTLE ROCK, ARKANSAS
THURSDAY, AUGUST 28, 1969, 12:00 NOON, CDT
FISCAL POLICY AND THE NATIONAL ECONOMY
I am very grateful for the opportunity to meet with
you today and to participate in your economic education
efforts.
My area of special responsibility at the Treasury
is economic policy, including the effects of taxes and
expenditures upon the economy.
As you know, this has been
a very active year for fiscal affairs.
steps remain to be taken.
Crucial legislative
But we have moved within sight
of both comprehensive tax reform and the orderly phase-out
of the income tax surcharge.
My remarks will not, however, be directed to the
important legislative issues of the day -- tax reform and
the extension of the surcharge.
Instead, I want to discuss
with you the more general problem of adapting the Federal
fiscal influence to the needs of the American economy.
While we are looking to the future, there are always
important lessons to be learned from the past.
A recent
lesson in fiscal affairs is that even a temporary loss of
K-183
- 2 economic stability can have lasting consequences.
In
three short years -- between fiscal 1965 and fiscal 1968
the Federal budget moved from a deficit of about $1-1/2
billion to a deficit of more than $25 billion when the
economy was already close to full employment.
Financial
markets came under heavy pressure and interest rates rose
sharply.
Cost-price stability was disrupted and a pervasive
inflationary psychology was allowed to develop.
Though the
budget is now in surplus, the after-effects of earlier
fiscal miscalculations are still very much with us.
The point where the wrong turn was taken is not hard
to find.
At the time of the Vietnam buildup, beginning in
mid-1965, there was a need for prompt fiscal action.
Taxes
should have been raised to pay for the war, or nondefense
spending cut back, or some combination of the two.
Instead,
there was fiscal escapism in the form of some minor adjustments
such as a speedup in tax collections.
The full burden of
restraining the economy was left up to the Federal Reserve
System.
The so-called "credit crunch" of 1966 with
a subsequent rise in the Federal budget deficit were only
part of the ill effects of inappropriate economic policy.
As the economy slowed down temporarily in early 1967,
fiscal action was postponed again.
When the executive
request for congressional action to raise taxes did come
- 3 -
in August 1967, it is hardly surprising that it met a great
deal of resistance.
Even the grudging acceptance by the
Administration of the principle of expenditure
co~trol
did
not clear the decks for prompt congressional action on the
tax increase.
Not until mid-1968 did tax and expenditure
control legislation finally become law.
By the latter half of 1968, the swing back toward
fiscal restraint was finally set in motion.
But the
combination of Federal expenditure reductions with the
income tax surcharge led policymakers to fear that economic
overkill might result.
As it turned out, the net effect
from the expenditure side was not as restrictive as might
have been expected; exemptions for various programs were
written into the law, and these categories substantially
overran the original budget estimates.
However, soon after
passage of the tax increase, the monetary authorities moved
in the direction of ease.
In the second half of 1968,
commercial bank credit grew at a 15 percent annual rate and
the money supply at more than 6 percent.
By the end of 1968,
unemployment had fallen below 3-1/2 percent, inflationary
pressures were intensifying, and a shift back to monetary
restraint was clearly in order.
While the monetary easing
at mid-1968 may have been premature, it has been reversed,
and restraint has since been the order of the day.
* * *
- 4 Both monetary and fiscal policies have to contend with
an uncertain future and they are bedeviled by an inability
to forecast accurately.
Indeed, the forecasting record of
the past few years leaves much to be desired.
As a result,
exaggerated claims for "fine tuning" and sensitive variation
in the "fiscal-monetary mix" have led to disillusionment,
particularly in the case of fiscal policy.
Certainly,
a healthy skepticism is in order as to what fiscal policy
can accomplish.
We need to recognize the practical limitations under
which fiscal policy operates.
There are serious barriers
to very frequent changes in fiscal policy for short-run
stabilization purposes.
A high degree of accuracy in
forecasting and in the confidence in these forecasts on
the part of policymakers is required.
And, fiscal policy
changes often require frequent and rapid congressional
action, perhaps more frequent and rapid at times than it
may be realistic to expect.
However, fiscal policy can be a very useful instrument
for stabilizing the economy and for promoting long-term
economic growth.
We need to improve our understanding of
the variety of ways in which governmental activities affect
the economy and to sharpen our tools of analysis and policy.
- 5 -
We can be encouraged by the demonstration that we do
learn from experience.
For example, during that unfortunate
miscalculation of economic policy in the period of the
Vietnam buildup, many, at the time, were urging improvements
in the Federal Government's statistical reports in order to
obtain better indications of changes in the military demand
for goods and services.
I am pleased to report that the
Census Bureau now issues each month a publication, "Defense
Indicators," which is a most useful compendium of information
for those of us concerned with evaluating the impacts of
Federal fiscal policy.
Although this type of factual
information should improve the caliber of economic analysis,
the implementation of the proper economic policy will at
times still require difficult political decisions.
* * *
Recent trends in Federal expenditure inevitably raise
some question regarding the longer-run fiscal position and
our ability to match rising expenditures with roughly comparable
increases in revenue.
Despite its enormous revenue-generating
powers, the economy has hardly been in a position to declare
any "fiscal dividends" recently.
The reason is clear enough.
Growth in Federal
expenditures has been extremely rapid.
For example, between
fiscal 1965 and fiscal 1969, total Federal budget outlays
- 6 -
rose from $118 billion to a1mostn85 billion.
This was
a rise of about $67 billion or 56 percent in four years.
Certainly the Vietnam effort accounts for a good part of
the rlse.
But, more than half of the $67 billion increase
$35 billion -- was outside of the national defense category.
Nondefense spending rose by about an average $8-1/2
billion annually from fiscal 1965 through 1969.
This compares
with an average rise of some $4.5 billion annually from fiscal
1961 through 1965.
Despite the more rapid advance of Federal
nondefense expenditures, there is little indication that
agency budgetary pressures, which arise from their own sense
of urgent priorities, are diminishing.
seems to be the case.
Quite the contrary
New programs uncover further needs
and demonstrate additional ways of meeting them.
Expenditure
ceilings are currently holding down growth in Federal spending
and are helping to contain inflation.
But, over the long run,
expenditures are sure to rise, if only because of rising
population and income and built-in cost increases in the
Federal Budget.
Rigorous control of less essential Federal expenditure
programs will be essential if pressing needs are to be met
over the longer run.
Already there are welcome signs that
Federal expenditures are being brought under better control.
Defense and controllable civilian expenditures are no longer
rising.
The increase in fiscal 1969 outlays of $6 billion
- 7 -
was more than accounted for by a $7+ billion rise in so-called
uncontrollable civilian programs (such as interest on the
public debt).
A similar pattern is anticipated for fiscal
1970 with controllable civilian outlays actually declining.
In this connection, we cannot count on a large so-called
"peace dividend" to loosen the Federal purse strings.
Some
observers look to the end of the war in Vietnam as somehow
permitting a massive increase in Federal expenditures.
The
"peace dividend" has sometimes naively been set close to
$30 billion, which is the total being spent on Vietnam.
Nothing like this sum will be available for Federal
spending.
First, the surcharge, now raising nearly $10 billion
a year, is being phased out.
Second, there is little reason
to believe that the end of the Vietnam War would quickly be
translated into a very sizable decline in the defense budget.
Simply to devote the same amount of real resources to defense
programs as before Vietnam would require a substantially
higher level of dollar expenditures than in 1965.
And, in
addition, there are other upward pressures on the defense
budget, including pay raises authorized under existing law,
the need to rebuild inventories, and to start some projects
postponed during the war.
The entire question of the Federal fiscal position
after peace comes in Vietnam has been under intensive study
within the Administration.
It is clear from these studies
- 8 that there will be a need for difficult choices among many
competing programs in the post-Vietnam period.
Alternative
claims on the Federal revenues are sure to be heavy.
Continuing efforts to cut down on less essential spending
programs will be necessary if the Federal fiscal position
is to be kept in reasonable balance.
* * *
There are periods when economic stability requires
a sizable Federal budget surplus.
a period now.
We are certainly in such
There are other times when temporary deficits
may be warranted.
Marginal adjustments will need to be made
in the Federal fiscal position in the future, but large and
frequent changes such as were experienced in some recent
years should be avoided.
We need a stabilizing fiscal policy,
not a disruptive one.
We also need a much better appreciation of the
monetary and credit market implications of the Federal
fiscal position.
Recent experience shows how harmful large
Federal deficits can be in overstrained credit markets.
Deficits at full employment mean that the Federal Government
is a net borrower at a time when total credit demands are
already likely to be too strong.
The extra Federal borrowing
may be fairly small relative to total output, but its full
weight impinges on credit markets whose short-run capacity
is limited.
- 9 -
The rise in the Federal deficit from less than
$2 billion to $25 billion between fiscal 1965 and 1968
"only" brought the deficit as a proportion of Gross National
Product to a little more than 3 percent.
But the increase
in the deficit caused the U. S. Government to borrow one-fourth
of all the funds raised in credit markets by both public and
private borrowers in fiscal 1968 compared to a modest amount
in earlier years.
This contributed substantially to higher
interest rates and reduced credit availability for many
private borrowers.
Federal budget deficits in an overheated economy are
expensive to finance.
Sometimes they may even tend to inhibit
the exercise of monetary restraint.
Large budget deficits
and frequent Treasury financings can make it at least temporarily
difficult for the monetary authorities to hold down the growth
in bank credit and the money supply.
Thus, inflationary
pressures get a double boost during these periods of so-called
"even keel."
Federal spending pumps more purchasing power
into the economy than taxes remove, and the financing of those
deficits itself tends to have inflationary monetary repercussions.
Fortunately, the Federal budget has now moved into
surplus -- $3 billion for the fiscal year just ended.
For
the current fiscal year and beyond, much depends upon upcoming
legislative actions.
The 10 percent surcharge has only been
- 10 extended through the end of this calendar year, although
the Administration urges that a 5 percent surcharge be
continued in the first half of calendar 1970.
The extra
six months of the surcharge and other elements of the
Administration's fiscal program were attached to the
comprehensive tax reform legislation recently approved
by the House of Representatives.
Next week Secretary Kennedy will appear before the
Senate Finance Committee when it begins consideration of
the tax package.
The Administration will be proposing
certain changes in the reform part of that package, both
to insure that tax burdens are shared as equitably as
possible and to prevent the loss of needed revenues.
There
is also a difficult economic question as to whether or not
the total impact of the legislation, however attractive on
equity grounds, might tend to favor consumption over investment
to an undesirable degree.
For the long run, continued high
rates of investment and productivity growth will be essential
to the achievement of most of our national goals.
If we
penalize investment unduly, we weaken our prospects for
future economic expansion.
The extension of the surcharge is essential to keep
the budget in an appropriate surplus position.
We had been
looking at an estimated Federal budget surplus of some
$6 billion in the corning fiscal year.
This seemed to be
about what the control of inflation would require.
If the
- 11 -
surcharge were not to be extended beyond the end of this
calendar year, the budget would move in a more stimulating
direction.
This could have undesirable consequences in
terms of inflationary pressures.
At present, fiscal policy is in a generally stabilizing
posture and it needs to stay that way.
The economy is still
expanding briskly and inflationary pressures are very strong.
Quarterly Gross National Product increments have averaged
close to $16 billion during the past year.
On the basis of
incomplete information, one might guess that in the third
quarter the economy has been moving at a roughly comparable
pace.
But far too much of the GNP increase has been coming
in the form of higher prices.
Indeed, on the GNP basis,
real growth is estimated to have slowed to about a 2 percent
annual rate in the April-June quarter of 1969, with prices
rising at about a 5 percent annual rate.
All of the key economic and financial statistics are
being examined closely for signs that restraint is becoming
increasingly effective, or even in danger of becoming too
effective.
Up to this point, I have not seen any significant
signs that restraint has been pushed too far.
Lags in the
effects of policies must obviously be taken into account in
determining whether restraint is in danger of overstaying
its time.
But restraint cannot be relaxed until it is clear
- 12 that inflationary pressures have been substantially reduced.
A retreat from gradualism would surely mean a strong
resurgence of inflationary expectations and would compound
the difficulties of dealing effectively with inflation in
the future.
* * *
Therefore, something like the current course seems to
be the most prudent one to follow.
A sizable budget surplus
and a restraining monetary policy should gradually reduce
the inflationary momentum.
Already there has been a gradual
slowing in the overall growth of the economy from the hectic
pace of a year or so ago.
But this cooling down process
needs to continue until it is clearly reflected in a much
slower rate of advance in costs and prices.
The money and financial markets are followed very
closely by many of you, I am sure.
picture
~s
As I see it, the general
one of considerable tautness, with monetary
restraint exerting its most noticeable effects in the housing
and municipal security areas.
Business loan growth has
slowed down a bit, and there has been some easing tendency
recently in selected short-term interest rates.
But there
do not seem yet to be unmistakable signs of reduced demand
for funds in the amounts and places that would signal
a general softening in economic activity.
- 13 Many of the conventional indicators of the degree of
monetary restraint have been more than usually difficult to
read in recent months.
supply series.
Revisions have affected the money
The significance of some other commercial
bank statistics has been affected as banks have tapped
nondeposit sources of funds and as borrowers have turned
from the banks to market sources.
But there is little
question of the pressure under which the banking system
has been placed, or that monetary policy is exerting
a steadily restraining effect.
In view of both the domestic
and balance of payments situations, that restraint has been
essential.
In appraising the current economic situation, I would
simply note that the short-run fiscal outlook is reasonably
satisfactory -- assuming favorable legislative action.
The
budget is now in surplus, though somewhat precariously.
Fiscal and monetary policies are geared together and are
exercising needed restraint.
Gradualism is working, but it
would be unrealistic to expect to be able to reverse strong
inflationary pressures both quickly and responsibly.
The
prudent course is to continue the cautious application
of restraint until there are clear signs that inflationary
pressures are receding.
Under our political system, there is considerable
continuity in broad elements of economic policy.
A new
Administration inherits problems and works at first within
- 14 an existing framework.
It then introduces its own new
approaches and gradually leaves its imprint on economic
events.
This Administration is now in this second stage
of introducing its own new approaches.
An example of a new initiative in the fiscal field
IS
the Administration's revenue sharing proposal.
We are
proposing that a stated percentage of personal taxable
income be turned back to the states and localities each
year to use as they see fit.
The fiscal year 1971 percentage
of one-sixth of one percent would amount to about $500 million.
The percentage would gradually rise to a permanent one percent
by fiscal year 1976, yielding an estimated annual total of
$5 billion to the states and localities.
The recent proposal to revamp the existing welfare
system is further evidence of the determination of this
Administration to break with the past and to undertake new
approaches where they are required.
Other innovations may
be desirable in the domestic economic area as time passes.
But the major domestic economic problem still is the current
inflation.
Lasting reduction of inflationary pressures must
continue to be the prime current objective of fiscal and
monetary policy.
000
TREASURY DEPARTMENT
August 26, 1969
FOR IMMEDIATE RELEASE
TREASURY MOVING QUICKLY
TO ASSIST HURRICANE CAMILLE VICTIMS
The Treasury announced today that, at the ,direction of
Secretary David M. Kennedy, the Department is moving quickly
to be of maximum assistance tc victims of Hurricane Camille.
At Treasury's request, a me~ting of the Coordinating
Committee on Bank Regulation has been called to devise and
implement ways of assuring a flow of bank credit to businessnen,
home-owners, and students.
Members of the Committee include representatives of
agencies that regulate banks and savings and loan institutions:
the Federal Reserve Board, Federal Deposit Insurance Corporation,
the Comptroller of the Currency, and the Federal Home Loan Bank
Board.
They will meet at 10:00 a.ln., Wednesday, at the FDIC.
Treasury offices, including the Internal Revenue Service,
the Bureau of the Public Debt, the Office of the Treasurer of
the United States, and the Comptroller of the Currency, have
taken special measures to assure the fullest possible service
to storm victims.
To help with the immediate financial needs of hurricane
victims in Mississippi, Louisiana, and Virginia, Treasury's
Acting Fiscal Assistant Secretary, Hampton A. Rabon, Jr., has
instructed the Department's paying agents in the disaster
areas to redeem U. S. Savings Bonds and Freedom Shares in
hardship cases even if they have not been held the required 60
days and one year, respectively.
Where Savings Bonds and Freedom Shares have been lost or
destroyed in the hurricane, Treasury will waive the normal
six-month waiting period for replacement and will speed the
issuance of duplicate securities.
The Department also will give preferential handling to
claims for relief because of loss, theft or destruction of
other registered Treasury securities, and to requests for
replacement of destroyed Treasury securities in bearer form.
K-184
(OVER)
- 2 The Office of the Treasurer of the United States,
Mrs. Dorothy Andrews Elston, has assigned priority to the
settlement of claims for the loss or destruction of Government
checks covering annuities, salaries, or other payments, and
to claims resulting from the damage or destruction of currency.
irs. Elston has directed that special attention be given to
cases involving hardship.
Comptroller of the Currency William B. Camp, as
administrator of national banks, has pledged "all possible
cooperation!! to banks affected by the hurricane damage.
?egulations governing bank operations will be interpreted
sympathetically to help banks maintain whatever services they
can offer, and to assist in restoration of full banking services
as quickly as possible.
Commissioner of Internal Revenue Randolph W. Thrower
reported actions by the Internal Revenue Service include:
Wide distribution of information on the deductibility
of casualty losses under Federal tax laws.
Special assistance and counseling for individual
taxpayers.
A ruling that contributions to the "We Care -- Hurricane
Camille Relief Fund" will be tax deductible for the
donors.
Notice to certain fiscal year taxpayers that they may
deduct their losses if the hurricane occurred after
the end of their tax year but before the due date of
their tax returns.
Arrangements for special attention in the 1970 filing
period to tax returns from the disaster areas, so
that refunds may be speeded up.
Advice to taxpayers who file declarations of estimated
tax that they may amend their declarations on or before
September 15, 1969, to reflect any decrease in estimated
tax as a result of casualty losses.
Treasury Under Secretary Charls E. Walker said that Treasury
will also cooperate fully in the Government-wide campaign for
contributions by Federal employees to the American Red Cross
disaster relief fund.
Mr. Walker has written to all Treasury
employees urging them to help meet the need for "additional
funds to assist victims in the widespread area affected by
Hurricane Camille."
000
TREASURY DEPARTMENT
•
4
WASHINGTON. D.C.
August 27,1969
FOR RELEASE A.M. NEWSPAPERS
FRIDAY, AUGUST 29, 1969
LOIS C. HOBSON APPOINTED TO
TREASURY'S EMPLOYMENT POLICY OFFICE
The Treasury Department today announced the appointment
of Lois Clark Hobson, effective September 8, as a staff
assistant in the Office of Employment Policy Program.
In this capacity Mrs. Hobson will assist in the
development of policies, programs and procedures relating
to equal employment opportunities within the Treasury
Department.
Before joining the Treasury Department Mrs. Hobson was
an Administrative Assistant in the Detroit Public School
System, Detroit, Michigan, where she was involved in the
development, implementation and coordination of federal
projects. From 1966 to 1967 she was a Community Services
Assistant, Mayor's Committee For Human Resources Development,
City of Detroit.
Mrs. Hobson, 31, is a native of St. Louis, Missouri
where she attended public schools. She received a bachelor
of arts degree from New Jersey State College, Union,
New Jersey in 1960. She later took graduate courses at the
University of Detroit and Wayne State University and in 1968
she received a master of arts degree from the University of
Michigan.
Mrs. Hobson has served on numerous C1V1C and educational
committees in the Detroit area. She has a daughter by a
former marriage, Donna Lynne Hobson,S.
000
TREASURY DEPARTMENT
WASHINGTON. D.C.
August 28, 1969
FOR IMMEDIATE RELEASE
TREASURY TO SPEED DISBURSEMENTS
FOR DAMAGED GULF COAST AREAS
The Treasury acted today to insure prompt delivery of
monthly Federal checks to retired persons, veterans and
other regular recipients in the areas of Mississippi and
Louisiana damaged by Hurricane Camille.
Sidney S. Sokol, Commissioner of the Bureau of Accounts,
said that Treasury will speed up processing of checks
scheduled for delivery in those areas the first week of
September. Mr. Sokol said Treasury will release the checks
to the postal service at least two days earlier than usual.
This should assure delivery of checks to the payees on the
regular payment dates by emergency Post Offices in the
disaster areas.
Treasury's action is designed to prevent any delay
in the receipt of checks by more than 17,000 persons located
in the hurricane-damaged areas of Mississippi and Louisiana
who receive monthly checks for such payments as social
security, veterans benefits, and civil service and railroad retirement.
000
K-185
TREASURY DEPARTMENT
d
WASHINGTON, D.C.
August 29, 1969
FOR IMMEDIATE RELEASE
TREASURY TO GIVE "ON THE SPOT" SERVICE
ON HURRICANE CAMILLE DISASTER LOANS
The Treasury announced today plans for "on the spot,"
immediate disbursement of Federal checks to Gulf Coast
victims of Hurricane Camille who obtain disaster loans from
the Small Business Administration.
Sidney S. Sokol, Commissioner of Accounts, said that
an emergency Treasury disbursing office will begin
operations in Gulfport, Mississippi, on Wednesday,
September 3. The office will be located in space pl-ovic1ccl
by the Small Business Administration in irs disaster lOCln
headquarters, Hancock Bank Building, 2500 14th Street.
Mr. Sokol said that Treasury's Chief Disbursing
Officer, Lester W. Plumly, developed the cooperative
arrangement with the Small Business Administration to
assure quick payment to hurricane victims obtaining SBA
home and business rehabilitation loans. Treasury personnel
will work side by side with SBA loan specialists, and \vill
issue checks to the storm victims within a few minutes
after SBA has approved their loan authorizations.
000
K-186
TREASURY DEPARTMENT
=
WASHINGTON. D.C.
FOR RELEASE 6: 30 P.M.,
Friday, August 29, 1969.
RESULTS OF TREASURY r S WEEKLY BILL OFFERING
The Treasury Department announced that the tenders for two series of Treasury
bills, one series to be an additional issue of the bills dated June 5, 1969, and the
other series to be dated September 4, 1969, which were offered on August 25, 1969, were
opened at the Federal Reserve Banks today. Tenders were invited for $1,600,000,000,
or thereabouts, of 91-day bills and for $1,200,000,000, or thereabouts, of 182-day
bills. The details of the two series are as follows:
RANGE OF ACCEPTED
COMPETITIVE BIDS:
High
Low
Average
~
9%
22%
91-day Treasury Bills
maturing December 4 z 1969
Approx. Equiv.
Price
Annual Rate
98.244 ij
6.947%
98.222
7.034%
98.227
7.014% V
182-day Treasury Bills
March 52 1970
Approx. Equiv.
Price
Annual Rate
96.405
7.1110/0
96.360
7.200%
96.377
7.166%
1/
U1aturi~
Excepting one tender of $100,000
of the amount of eX-day bills bid for at the low price was accepted
of the amount of 182-day bills bid for at the low price was accepted
TOTAL TENDERS APPLIED FOR AND ACCEPI'ED BY FEDERAL RESERVE DISTRICTS:
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Mirmeapolis
Kansas City
Dallas
San Francisco
Applied For
$ 29,754,000
1,964,124,000
35,638,000
29,223,000
25,163,000
41,835,000
267,474,000
43,947,000
26,569,000
26,632,000
27,167,000
164,195,000
Accefted
TOTALS
$2,681,721,000
$1,600,024,000
$
~,108,OOO
1,065,597,000
20,390,000
27,732,000
25,163,000
29,178,000
235,783,000
28,507,000
25,569,000
23,026,000
15,667,000
85,304,000
£I
AEElied For
8,825,000
$
1,645,717,000
19,879,000
30,985,000
17,710,000
30,432,000
129,793,000
26,697,000
18,741,000
22,545,000
22,029,000
130,192,000
AcceEted
$2,103,545,000
$1,200,091,000 ~/
$
8,825,000
872,212,000
9,879,000
30,408,000
17 ,710,000
23,432,000
94,535,000
19,107,000
17,241,000
22,091,000
12,639,000
72,012,000
~ Includes $314,854,000 noncompetitive tenders accepted at the average price of 98.227
ij Includes $176,110,000 noncompetitive tenders accepted at the average price of 96.377
"Y These rates are on a bank discount basis.
The equivalent coupon issue yields are
7.24% for the 91-day billS, and 7.54% for the 182-~ay bills.
@FedFRASER