LIMIT OF DEBT

Gisborne Herald, Volume LXVII, Issue 20136, 4 January 1940, Page 7

LIMIT OF DEBT

BUDGET BURDEN HUGE U S. DEFICIT OUTLAY ON DEFENCE ROOSEVELT EXPLAINS FIERY DEBATE LIKELY (Elec. Tel. Copyright—United Press Assn.) (Reed. Jan. 4, 10.30 a.m.)WASHINGTON, Jan. 3. Addressing Congress at the opening of the session, President Roosevelt said that the United States must be a potent and active factor in seeking the re-establishment of peace. He added: "But we must likewise be prepared to take care of ourselves if the world cannot attain peace. Accordingly I am asking for increases for

the army and navy, which are based on common-sense and not on panic.”

President Roosevelt’s annual message to Congress was . expected to give Americans not only an interesting account of the internal affairs of the nation, but also to chart America's position in the world at war.

Mr. Roosevelt’s Budget was expected to total . £2,375,000,000. predicting a 1940-41 fiscal year deficit of approximately £750,000,000, bringing the national debt to the statutory limit of £11,250,000,000. Heavy Taxation The contemplated expenditures, moreover, £500,000,000 on national defence, involving new taxes amounting to £125,000,000, will certainly offer inflammable material for the Congres-. sional debates. The President was confidently expected to propose no further experimental legislation* but the New Deal continues to be a live issue and will remain so until the Presidential election in November.

The prominent mention of the name of the Secretary of State, Mr. Cordell Hull, is expected to produce confusion in the Democrat Party ranks. Mr. Hull incidentally will face the greatest political test of his career, since the reciprocal trade programme which he sponsored will undergo an extreme attack.