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4525776
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Michigan Congressional Dinner, May 1, 1962
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4525776
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document
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Michigan Congressional Dinner, May 1, 1962
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Gerald R. Ford Congressional Papers
Speeches
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Budget deficits
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Taxation
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1962-05-31
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5
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1962
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1962-05-01
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5
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1962
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The original documents are located in Box D16, folder "Michigan Congressional Dinner,
May 1, 1962" of the Ford Congressional Papers: Press Secretary and Speech File at the
Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. The Council donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
speech
Remarks of
Rep. Gerald R. Ford, Jr.
MICHIGAN CONGRESSIONAL DINNER
May 1, 1962
The Treasury Department informs me that it anticipates a federal
deficit for the current fiscal year of $7.0 billion. The Joint Committee on
Internal Revenue taxation estimates a deficit of $3.8 billion next year if the
Kennedy tax proposals as passed by the House do not become law. If this
legislation does become law the deficit will be $5 billion.
We are not operating under a balanced budget this year, and we will have
another deficit next year. It will be greater by $1 billion if the Kennedy tax
proposals are adopted. To me this is prima facie evidence that the Administration's
tax and expenditure proposals do not provide a sound basis for a developing
economy.
Interest charges next year on the $300 billion national debt will be
$9.4 billion. This is $123 a year in taxes for every person over 14 years of age
in the labor force. This is the practical application of the theoretical
doctrine of deficit financing. In these interest charges, the economic theories
of the spenders reach into the pocketbooks of all of us, More taxes to pay
more interest retards rather than expands the economy.
The increases in the cost of the federal government in recent years came
not from defense spending but rather from non-defense expenditures.
The Korean conflist ended in mid-1953. Using fiscal year 1954 which
began July 1, 1953 as a point of reference and taking the President's 1963 budget
and projecting expenditures through next year, we find that defense expenditures
are up only 12 percent above 1954 while non-defense spending will have increased
by 94 percent.
LIBRARY RD
Digitized from Box D16 of the Ford Congressional Papers: Press Secretary and Speech File at the Gerald R. Ford Presidential Library
-2-
Defense spending for our national security is not responsible for
continued deficit financing and the increasing federal debt.
Now to the Administration's tax bill as passed by the House. In spite
of all the propaganda build-up which accompanied this bill, I see more harm
than benefit in these proposals insofar as the domestic economy is concerned.
The sovealled investment credit incentive is nothing more than a short
term subsidy for capital investment. If we have the proper environment for
business, no incentive is needed. The investment credit lacks the elements of
true incentive in that a taxpayer is being subsidised to do something which he
will do in any event if business conditions justify his action.
This windfall, on the basis of the most favorable estimates of the
Treasury, will cost the Treasury in revenue loss about $1.5 billion the first
year.
Other provisions of the Act will supply additional revenue, but the
net loss to the Treasury will be $1.1 billion according to the Joint Committee
estimates.
The answer to the question presented to me is a simple and direct "Mo."
The answer could be "yes." Reduce non-essential, non-defense spending.
Balance the budget. Cut down the debt. Reduce interest charges. Adopt a
responsible fiscal policy for the Government, and I will have no fear for the
future expansion and development of our country.