Where the Money Goes

In his annual budget message, the President proposed a record peacetime high in spending: $41.9 billion. (Estimated expenditures this year: $40.2 billion.) He asked for a $5.9 billion tax boost,* even though, at current tax rates, estimated revenues for fiscal 1950 are only $873 million shy of what he proposes to spend. The trouble is, the President explained, there is always a lag in collections.

Arms and foreign aid together, said the President, would take 50-c- of every tax dollar next year. The items:

Foreign Aid. $6.7 billion, chiefly for ECA and to support the Army's relief program in occupied areas. China aid was cut from $350 million to $49 million. The President warned that additional funds would be required under the proposed North Atlantic Alliance.

National Defense. $14.3 billion to provide for a 48-group Air Force of 412,000 men, an Army of 677,000 men, a Navy of 731 ships and 527,000 men, and a $600 million universal military training program. The President, well aware of the fact that the 80th Congress authorized a 70-group Air Force, warned: "Expenditures for national defense can be expected to rise substantially [in 1951] above the level estimated for 1950."

Domestic Affairs. $6.2 billion for old-line Government agencies (agriculture, labor, etc.), $2.4 billion for social welfare, $5.5 billion for veterans, $5.4 billion interest on the $252 billion debt.

*Including $1.7 billion more in payroll deductions for increased social security.

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