76

WAR  BORROWING

graph  showing  the  course  of  the  daily  “  net  balance ­
  ”  of  the  Treasury  during  the  period  under
review. 1 ,

I
The  three  months  that  preceded  our  entry  into
the  war  were  marked  by  a  steady  excess  of  disbursements ­
  over  receipts.  Starting  with  a  net  balance ­
  of  $113,597,985  on  January  2,  1917,  the  available ­
  funds  of  the  Treasury  declined  practically  without ­
  arrest.  On  February  23,  1917,  there  was  for
the  first  time  an  actual  deficiency  as  compared  with
the  authorized  but  undrawn  amount  to  the  credit  of
disbursing  officers,  and  a  week  earlier  the  “  daily
statement  ”  had  begun  to  note  that  “  the  income
tax,  constituting  a  large  part  of  the  Government’s
revenue,  is  not  collected  until  June,”  and  to  present
the  estimated  amount  payable  at  that  time.
The  Treasury  balance  touched  its  low  point  on
March  15,  1917,  at  $52,951,594.  For  the  next  two
weeks  some  restraint  was  apparently  put  upon  disbursements ­
  ;  but  on  March  30  the  nominal  deficiency
as  against  disbursing  officers’  credits  was  nearly
$10,000,000,  with  a  further  immediate  requirement
of  $25,000,000  in  settlement  of  the  Danish  West
Indies  purchase.  The  provision  of  additional
funds  could  not  be  delayed,  and  on  March  31,  1917,
the  Treasury,  in  anticipation  of  the  income  taxes
payable  in  June,  borrowed  $50,000,000  from  the
1  See  frontispiece.  I  am  indebted  to  Mr.  Leopold  Olceowski
of  Washington,  D.  C.,  for  the  transformation  of  my  own
rough  graph  into  the  finished  chart.