LIBRARY 
^OOM  5025 

TREASURV    r,c-n 


MENT 


[0 

M 
C.3 


U.S.  |rea9.Qr^  r^p1:. 

Annual  Report  iqbi 

of  the 

Secretary  of  the  Treasury 

on  the 

State  of  the  Finances 

For  the  Fiscal  Year  Ended  June  30,  1961 


LIBRARY 
WOM  5025 

TREASURY  DEPARTMENT 


TREASURY  DEPARTMENT 

DOCUMENT  NO.  3222 
Secretary 


UNITED  STATES  GOVERNMENT  PRINTING  OFFICE,  WASHINGTON  :   1962 

For  sale  by  the  Superintendent  of  Documents,  U.S.  Government  Printing  Office 
Washington  25,  D.C.     -     Price  ?2.50  (paper  cover) 


LETTER  OF  TRANSMITTAL 

Treasury  DepartmexVT, 
Washington,  March  30,  1962. 

Sirs:  Pursuant  to  the  requirements  of  Section  262  of  Title  5  of  the 
United  States  Code,  I  have  the  honor  to  submit  to  you  herewith  my 
Annual  Report  on  the  State  of  the  Finances. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


To  THE  President  of  the  Senate. 

To  the  Speaker  of  the  House  of  Representatives. 


CONTENTS 

Page 
ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY  ON 

THE  STATE  OF  THE  FINANCES 1 

REVIEW   OF   OPERATIONS   AND   STATISTICS  FOR   THE  FISCAL 

YEAR  1961 5J 


Note. — Details  of  figures  may  not  add  to  the  totals  because  of  rounding. 

V 


ANNUAL  REPORT 

OF  THE 

SECRETARY  OF  THE  TREASURY 

ON  THE 

STATE  OF  THE  FINANCES 


SUMMARY 

When  the  present  administration  assumed  ofRce  in  January  1961, 
the  Nation  faced  two  serious  economic  problems :  A  recession  at  home, 
which  had  continued  for  eight  months;  and  a  persistent  deficit  in  this 
countr3^'s  international  balance  of  payments,  which  had  shaken  con- 
fidence in  the  stabihty  of  the  dollar.  Forthright  action  was  taken  to 
combat  both  problems.  While  their  ultimate  solution  lies  in  the 
future,  gratifying  progress  has  been  made. 

The  two  problems  are  intimately  related.  In  the  world  of  the 
1960's,  everything  the  Government  does  to  foster  recovery  and  eco- 
nomic growth  at  home  must  be  considered  in  the  light  of  its  impact 
upon  the  Nation's  economic  position  in  the  world.  And  every  move 
to  maintain  confidence  in  our  currency  abroad  must  be  weighed 
against  its  effect  upon  the  domestic  economy. 

Any  accounting  of  Treasury  actions  and  accomplishments  during 
1961  must,  therefore,  focus  on  efforts  to  reconcile  conflicts — both 
seeming  and  real — between  our  domestic  and  our  foreign  economic 
programs. 

In  fact,  there  is  no  conflict  between  our  national  and  international 
objectives.  If  this  Nation  fails  to  maintain  a  vigorous  economic 
system,  capable  of  utilizing  its  resources  fully  and  expanding  its 
productive  potential  adequately,  America's  political  and  military 
leadership  of  the  free  world  will  inevitably  deteriorate.  Similarly, 
if  we  fail  to  help  maintain  stable  currencies  and  vigorous  economies 
throughout  the  free  world,  there  can  be  no  prosperity  for  our  own 
people. 

While  our  international  and  domestic  goals  thus  automatically 
interlock  and  reinforce  each  other,  formulating  policies  that  will  serve 
both  objectives  can  involve  difficult  choices.  We  must  disavow  any 
philosophy  and  reject  all  programs  that  support  one  exclusively  at  the 
cost  of  the  other. 

This  we  have  done  in  1961  and  will  continue  to  do. 

Budgetary  policies  have  been  adopted  which  meet  urgent  national 
needs  and,  at  the  same  time,  have  clearly  demonstrated  to  the  world 
our  intention  to  manage  our  fiscal  affairs  wisely  and  prudently. 

Monetary  and  debt  management  policies  have  been  followed  that 
have  contributed  simultaneously  to  vigorous  economic  growth  at  home 
and  to  stability  in  world  financial  markets. 

3 


4     ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Tax  policies  have  been  developed  that  will  directly  promote  expan- 
sion of  business  and  emplo^aiient  at  home  and,  at  the  same  time, 
strengthen  the  Nation's  competitive  position  abroad. 

The  interrelationship  of  fiscal  and  monetary  policies  has  been 
recognized  and  designed  to  encourage  greater  investment  in  pro- 
ductive facilities — another  objective  that  serves  both  our  national  and 
international  needs. 

And  finally,  the  administration  has  moved  boldly  into  a  new  world 
of  close  and  confidential  financial  cooperation  with  our  friends  and 
allies,  thus  strengthening  the  economic  security  and  stabilit}^  of  all 
free  nations. 

Our  problems  are  far  from  solved  and  the  future  ma}^  bring  new 
ones  which  will  require  that  old  programs  be  modified  or  scrapped  and 
new  ones  developed  to  supplement  or  supplant  them.  Our  policies, 
however,  will  always  be  pointed  toward  both  objectives:  A  vigorous, 
expanding  domestic  economy  and  equilibrium  in  our  international 
financial  position. 


FISCAL  POLICY 

Fiscal  policy,  which  concerns  the  level  and  composition  of  Govern- 
ment expenditures,  the  level  and  sources  of  Government  receipts,  and 
the  balance  between  expenditures  and  receipts,  plays  a  key  role  in  the 
attainment  of  our  national  objectives. 

Federal  expenditures  for  goods  and  services,  or  in  the  form  of 
transfer  payments  to  State  and  local  governments  or  to  individuals, 
affect  the  trend  of  private  economic  activity  and  the  composition  of 
national  output. 

Moreover,  even  Government  programs  which  do  not  require 
significant  cash  outlays  may  strongly  influence  private  economic 
decisions.  For  example.  Government  insurance  and  guarantee 
programs,  such  as  those  covering  home  mortgages,  may  require  little 
direct  expenditure  but  can  have  widespread  economic  consequences. 

Similarly,  not  only  the  volume  of  tax  receipts  but  also  different 
levels  and  types  of  taxation  produce  far-reaching  economic  results. 

The  financial  plans  of  the  Federal  Government  must  fulfill  certain 
basic  requirements: 

National  security,  including  military,  other  defense,  and  foreign 
policy  requirements,  must  be  met  in  full. 

The  need  of  the  domestic  economy  for  stimulation  or  restraint,  or 
for  an  essentially  neutral  influence,  as  appropriate  to  economic  con- 
ditions, must  be  met. 

International  financial  consequences  of  domestic  economic  trends 
and  policies  must  be  taken  fully  into  account. 

Vital  nondefense  programs  must  be  provided  for. 

An  adequate  revenue  base  must  be  established  and  maintained. 

National  security  needs  come  fu'st.  While  the  Government  must 
fulfill  national  security  requirements  as  efficiently  as  possible — ever 
on  guard  against  waste  and  duplication — it  is  inappropriate  to  con- 
fine national  security  programs  within  arbitrary  expenditure  ceilings. 
Other  considerations  of  fiscal  policy  must  be  tailored  to  fit  national 
security  requirements,  if  necessary  through  tax  increases,  increased 
borrowing,  postponement  or  curtailment  of  less-essential  domestic 
programs,  or  some  combination  of  these. 

The  influence  of  Government  spending  trends  and  of  the  Govern- 
ment's surplus  or  deficit  position  on  the  health  and  vitality  of  the 
national  economy  is  a  continuous  consideration.  Few  dispute  the 
appropriateness   of  Federal  budget   deficits  in   a   time  of  declining 

5 


6     ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

or  depressed  economic  activity,  or  of  Federal  budget  surpluses  in  a 
time  of  rapid  expansion  and  inflationary  threat.  But  between  such 
periods  of  obvious  need  for  stimulation  or  restraint,  there  frequently 
exist  economic  conditions  which  call  for  fine  tuning  of  fiscal  policies  to 
more  complex  economic  needs.  With  the  emergence  of  international 
balance-of -payments  considerations  as  a  factor  in  domestic  economic 
policy  judgments,  additional  delicate  adjustments  of  fiscal  policy 
nowadays  are  frequently  required. 

Decisions  concerning  the  components  of  Government  outlays  also 
require  the  weighing  of  complex  considerations.  Since  Government 
resom'ces  are  limited,  spending  priorities  must  be  established  and 
essential  programs  distinguished  from  the  merely  worthwhile  or 
desirable.  How  many  in  the  latter  category  may  be  undertaken,  and 
to  what  extent,  will  depend  on  the  level  of  spending  required  by 
national  security  and  essential  domestic  programs  and  the  extent  to 
which  overall  economic  needs  dictate  a  tighter  or  less  restrictive 
fiscal  policy. 

Major  budget  concepts 

No  single  budgetary  system  is  wholly  adequate  for  complete  anal- 
ysis of  the  effect  of  Federal  fiscal  operations  on  the  level  and  compo- 
sition of  economic  activity.  For  this  reason,  other  accounting 
concepts,  in  addition  to  the  conventional  administrative  budget, 
have  been  developed.  The  most  familiar  is  the  cash  budget  which 
covers  all  cash  receipts  from  and  payments  to  the  public,  except 
borrowing  from  the  public.  More  recently,  the  record  of  the  activities 
of  the  Federal  Government  in  the  national  income  and  product 
accounts  has  been  increasingly  used. 

The  administrative  budget,  the  accounting  S3"stem  commonly  re- 
ferred to  as  "the  Budget,"  is  primarily  a  presentation  of  adminis- 
tration policies.  It  sets  forth  governmental  programs,  together  with 
their  estimated  costs  and  proposed  means  of  financing  them.  The 
administrative  budget  is,  however,  of  limited  use  in  appraismg  the 
effects  of  Federal  financial  transactions  on  the  economy.  In  part  this 
is  because  the  operations  of  the  Government  trust  fmids  and  of 
Government-sponsored  enterprises  are  largely  omitted  from  the 
administrative  budget  figures. 

The  cash  budget  includes  the  activities  of  the  Government's  various 
trust  funds,  the  largest  of  which  are  the  social  security  and  highway 
trust  funds,  but  also  the  transactions  of  Government-sponsored 
enterprises,  which  include  the  Federal  Deposit  Insurance  Corporation, 
Federal  intermediate  credit  banks,  Federal  land  banks,  Federal  home 
loan  banks,  and  banks  for  cooperatives. 


FISCAL    POLICY  7 

Unlike  either  the  administrative  or  cash  budgets,  the  timing  of 
Federal  receipts  and  expenditures  in  the  national  income  and  product 
accounts  is  designed  to  coincide  with  their  impact  upon  the  economy. 
Hence,  most  taxes  are  recorded  at  the  time  the  tax  liability  is  in- 
curred, and  purchases  reflect  the  time  of  acquisition  rather  than  of 
payment.  This  statement  also  includes  trust  funds  but  excludes 
certain  financial  transactions,  such  as  loans  or  the  purchase  or  sale 
of  existing  assets,  which  represent  neither  the  production  of  current 
output  nor  incomes  earned  in  production. 

It  is  also  clearly  important  in  analyzing  the  economic  significance  of 
the  Federal  budget  to  recognize  that  it  includes  substantial  outlays  for 
public  works  and  other  durable  assets  and  capital  items  that  will 
continue  to  yield  benefits  for  many  years  after  the  fiscal  year  in  which 
the  expenditures  are  recorded.  Many  loan  and  grant  programs,  as 
well  as  direct  expenditures  programs,  fall  in  this  category.  In  addition 
many  categories  of  Government  expenditures  are  "developmental" 
in  natiu-e,  such  as  outlays  for  education  and  training  and  for  research 
and  development.  The  importance  of  the  distinction  between  outlays 
for  current  and  capital  purposes,  in  fact,  has  caused  many  businesses 
and  State  and  local  governments,  as  well  as  foreign  governments,  to 
show  separate  budgets  for  current  and  capital  expenditures. 

Fiscal  year  1961 

When  this  administration  assumed  office,  the  Nation  was  in  its 
eighth  month  of  economic  decline.  The  gross  national  product, 
which  had  reached  a  peak  of  $506.4  billion,  seasonally  adjusted  annual 
rate,  in  the  fourth  quarter  of  fiscal  1960,  had  fallen  to  $504.5  billion  in 
the  second  quarter  of  fiscal  1961  and  fell  further  to  $500.8  billion  in  the 
January-March  quarter  of  1961.  The  industrial  production  index, 
seasonally  adjusted,  had  fallen,  by  December  1960,  to  103  percent  of 
its  1957  base  from  a  high  of  111  in  January  1960  and  continued  to  fall, 
reaching  a  low  of  102  in  February.  The  unemployment  rate, 
seasonally  adjusted,  which  had  remained  at  5  percent  or  more  in  every 
month  but  one  since  the  1957-58  recession,  had  reached  6.7  percent  in 
December  1960  and  continued  near  this  level  throughout  the  first  ten 
months  of  1961.  In  addition,  our  balance-of-payments  position,  which 
had  progressively  worsened  during  1960,  remained  a  serious 
consideration. 

In  those  circumstances,  a  fiscal  policy  directed  toward  arresting 
the  downturn  and  giving  upward  momentum  to  the  economy  was 
clearly  in  order. 

Extended  temporary  unemployment  benefits,  a  speedup  in  income 
tax  refunds,  early  payment  of  Veterans'  Administration  life  insurance 


8     ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

dividends,  and  a  special  VA  insurance  dividend,  added  directly  to 
disposable  personal  income  and  helped  sustain  pui'chasing  power. 
Accelerated  military  procurement  and  construction  and  highway  aid 
payments  directly  stimulated  production  and  employment.  Other, 
longer  term  programs  were  inaugurated,  including  a  higher  minimum 
wage  with  expanded  coverage,  assistance  to  areas  of  chronic  unem- 
plo>Tnent,  and  increased  Federal  aids  for  housing. 

These  changes  in  Federal  fiscal  programs,  with  other  measures 
employed  by  the  new  administration,  helped  spur  an  increase  in 
economic  activity.  By  the  end  of  fiscal  1961  much  more  ground 
had  been  regained  than  had  been  lost  during  the  recession  months, 
without  emergence  of  inflationary  pressures. 

The  administrative  budget. — Budget  (net)  receipts  in  fiscal  1961 
totaled  $77.7  billion  and  expenditures  were  $81.5  billion,  resulting  in 
a  $3.9  billion  deficit  for  the  fiscal  year.  In  the  previous  fiscal  year, 
expenditm-es  had  totaled  $76.5  billion  and  receipts  $77.8  billion,  re- 
sulting in  a  surplus  of  $1.2  billion. 

The  previous  administration  had  estimated  expenditures  in  fiscal 
1961  of  $78.9  billion,  receipts  of  $79.0  billion,  and  a  surplus  of  $79 
million.  Thus,  slightly  more  than  one-third  of  the  difference  betw^een 
the  projected  budget  surplus  and  the  actual  deficit  recorded  resulted 
from  failure  of  receipts  to  maintain  the  level  anticipated  by  the  out- 
going administration. 

By  far  the  largest  portion  of  the  increase  in  expenditures  over  fiscal 
1960  was  the  $2.8  billion  for  national  defense,  international  affairs  and 
finance,  and  space  research  and  technology.  An  additional  $600  mil- 
lion in  added  expenditures  was  incurred  for  necessary  antirecession 
programs.  Expenditures  for  all  other  purposes  were  $1.6  billion 
greater  than  in  fiscal  year  1960,  but  only  about  $200  million  more 
than  estimated  by  the  outgoing  administration.  About  one-fifth  of 
this  increase  was  for  interest  on  the  public  debt. 

Net  budget  receipts  for  fiscal  1961  included:  $41.3  billion  in  indi- 
vidual income  taxes,  which  accounted  for  more  than  half  of  total 
budget  receipts;  $21.0  billion  in  corporate  income  taxes;  $9.1  billion 
in  excise  tax  collections;  $1.9  billion  in  estate  and  gift  taxes;  $1.0 
billion  in  customs  collections;  and  $3.4  billion  in  miscellaneous 
receipts. 

Although  individual  income  tax  collections  showed  a  gain,  corporate 
and  excise  tax  and  customs  collections  were  down  from  those  of  fiscal 
1960  (after  deduction  of  interfund  transactions). 

Cash  budget. — In  fiscal  1961,  cash  payments  to  the  public  exceeded 
cash  receipts  by  $2.3  billion.  The  cash  deficit  was  less  than  the 
budget  deficit,  since  trust  funds  receipts  exceeded  expenditures  by 
$568  million,  Government-sponsored  enterprises  net  receipts  were  $236 


FISCAL   POLICY  9 

million,   and  net  interest  accruals  and  other  noncash  adjustments 
amounted  to  $821  million. 

National  income  and  'product  accounts. — In  the  national  income  and 
product  accounts,  Federal  expenditures  exceeded  receipts  by  $2.2 
billion  in  fiscal  1961.  A  moderate  surplus  in  the  first  quarter  of  the 
fiscal  year  changed  to  a  substantial  deficit  in  the  last  half  of  the  fiscal 
year,  reflecting  additional  expenditures  largely  for  defense  and  the 
effects  of  the  recession  on  tax  accruals. 

Fiscal  year  1962 

In  a  year  of  presidential  change,  the  budget  for  the  succeeding 
fiscal  year  is  presented  according  to  law  by  the  outgoing  administra- 
tion. Thus,  during  its  first  several  months  in  office  the  new  admin- 
istration was  simultaneously  planning  to  meet  immediate  needs  in 
the  remaining  months  of  fiscal  1961,  reviewing  the  fiscal  1962  pro- 
posals of  the  outgoing  administration,  and  formulating  its  own  pro- 
grams. Paramount  considerations  were  the  need  to  stimulate 
economic  recovery  and  to  alleviate  the  worsening  international 
situation  which  culminated  in  the  Berlin  crisis  in  July  1961. 

Although  by  the  last  quarter  of  fiscal  1961  it  was  clear  that  the 
economy  was  again  expanding,  it  was  also  clear  that  a  satisfactory 
decrease  in  unemployment  was  still  many  months  in  the  future.  It 
was  decided,  therefore,  that  necessary  increases  in  military  and  do- 
mestic spending  should  be  put  into  effect  without  any  compensating 
increase  in  taxes,  thus  continuing  the  economic  stimulus  of  a  Govern- 
ment deficit. 

The  administrative  budget. — In  the  January  1962  budget  message 
expenditures  in  fiscal  1962  were  estimated  at  $89.1  billion,  or  $7.6 
bilhon  more  than  in  fiscal  1961.  Receipts  were  estimated  at  $82.1 
bilhon,  compared  with  $77.7  biUion  in  fiscal  1961,  resulting  in  an 
estimated  deficit  of  $7.0  billion,  compared  with  a  deficit  of  $3.9 
billion  in  fiscal  1961. 

Since  budget  receipts  in  a  fiscal  year  are  primarily  associated  with 
income  and  profits  levels  in  the  calendar  year  which  ends  in  the 
fiscal  3^ear,  the  increase  in  estimated  receipts  for  fiscal  1962  over 
fiscal  1961  reflects  the  rise  in  economic  activity  in  1961.  However, 
since  the  low  point  of  the  1960-61  recession  was  reached  in  the  first 
quarter  of  calendar  1961,  fiscal  1962  receipts  still  reflect  the  impact 
of  that  recession. 

The  estimated  increase  in  budget  expenditures  from  fiscal  1961  to 
1962  is  $7.6  billion,  of  which  $4.7  billion,  or  more  than  60  percent,  is 
for  national  defense,  international  affairs  and  finance,  and  space 
research  and  technology.     Of  the  remaining  $2.9  billion  increase, 


10    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

$1.2  billion  is  for  agricultural  programs,  particularly^  farm  income 
stabilization  and  food  for  peace  programs. 

In  the  January  budget  document  the  estimates  for  fiscal  1962 
show  an  increase  in  expenditures  of  $8.2  billion,  compared  with  the 
estimates  submitted  by  the  previous  administration.  Of  this  amount, 
more  than  half,  $4.7  billion,  represents  the  increase  in  planned  outlays 
for  defense,  space  technology,  and  international  programs,  and  the 
larger  anticipated  cost  of  interest  on  the  public  debt.  Another 
$1.2  billion  is  accounted  for  by  the  rise  in  the  cost  of  agricultural 
programs. 

According  to  the  January  budget  document  budget  receipts  for 
1962  were  expected  to  run  about  $200  million  lower  than  estimated 
b}^  the  previous  administration. 

Individual  income  tax  collections  were  estimated  at  $45.0  billion  and 
corporate  tax  collections  at  $21.3  bilhon — the  former  a  significant 
increase  from  fiscal  1961,  the  latter  a  modest  one.  All  other  major 
categories  of  receipts  were  expected  to  show  some  rise,  with  the  excep- 
tion of  miscellaneous  receipts,  because  of  a  large  advance  loan  repay- 
ment by  the  Federal  Kepublic  of  Germany  in  1961.  Excise  tax 
collections  were  estimated  at  $9.6  billion;  estate  and  gift  taxes  at  $2.1 
billion;  customs  collections  at  $1.2  billion;  and  miscellaneous  receipts 
at  $2.9  billion. 

Cash  budget. — Cash  payments  to  the  public  were  estimated  to  exceed 
cash  receipts  from  the  public  by  $8.5  billion  in  fiscal  1962,  a  deficit 
larger  than  the  budget  deficit,  mainly  because  trust  fund  expenditures 
were  expected  to  exceed  receipts  by  $1.0  billion.  Expected  net 
expenditures  of  $514  million  from  the  operations  of  Government- 
sponsored  enterprises  account  for  nearly  all  the  remaining  difference 
between  the  administrative  and  cash  budget  deficits. 

National  income  and  -product  accounts. — It  was  estimated  that  the 
national  income  and  product  accounts  would  show  a  deficit  of  $0.5 
billion  in  fiscal  1962,  compared  with  a  deficit  of  $2.2  billion  in  fiscal 
1961.  The  Federal  Government  was  expected  to  shift  from  a  deficit 
position  to  a  surplus  position  in  the  latter  part  of  the  fiscal  year,  thus 
providing  a  moderate  restraining  influence  on  the  economy,  as  output 
increases,  in  place  of  the  net  stimulative  effect  exerted  throughout 
calendar  1961. 

Fiscal  year  1963 

The  economic  considerations  which  underlay  budget  policy  for 
the  fiscal  year  1963  were  somewhat  more  complex  than  those  which 
had  characterized  the  two  previous  years. 

The  fiscal  1963  budget  was  in  preparation  during  the  final  months 
of  calendar  1961,  when  the  economic  recoverv  was  well  established 


FISCAL    POLICY  11 

and  nearly  every  measure  of  economic  activity  had  reached  new 
records.  Although  unemployment  and  underutilization  of  productive 
capacity  remained  high,  continuous  expansion  and  fuller  utilization 
of  resources  were  expected.  Moreover,  balance-of-payments  prob- 
lems, which  the  recession,  with  its  accompanyuig  lower  demand  for 
imports,  had  helped  to  ease,  were  again  causing  concern. 

Although  strong  stimulation  of  the  economy  by  fiscal  means 
seemed  no  longer  necessary,  it  was  important  to  avoid  a  degree  of 
restraint  which  might  choke  off  the  expansion  needed  to  bring  down 
unemployment  and  set  the  economy  firmly  on  the  road  to  sustamed 
growth. 

While  the  existing  high  imemplo^mient  and  underutilization  of 
capacity  might,  in  other  circumstances,  have  made  continuation  of 
budgetary  deficits  desirable  as  a  stimulus  to  growth,  balance-of- 
payments  considerations  indicated  a  need  for  different  measures. 

Continued  strong  economic  expansion  without  upward  pressures 
on  prices  was  necessary.  The  clearly  evident  means  of  achieving 
this  was  a  higher  level  of  private  investment  in  productive  facilities, 
investment  which  would  not  only  directly  stimulate  expansion,  but 
would  also  substantially  increase  the  competitiveness  of  American 
products  in  markets  at  home  and  abroad,  thus  easing  the  balance-of- 
payments  situation. 

The  need  for  an  expanding  level  of  private  investment  emphasized 
the  desirability  of  a  situation  in  which  the  Federal  Government  would 
not  have  to  draw  savings  from  the  private  economy  to  finance  a 
Government  deficit.  It  also  required  that  credit  be  relatively  easily 
attainable  and  at  favorable  rates. 

Thus,  it  was  decided  to  present  a  balanced  budget  for  the  new 
fiscal  year  which  will  begin  in  July  1962.  Only  a  moderate  surplus 
of  $463  milhon  was  provided,  however,  in  the  conventional  or  adminis- 
trative budget.  It  was  considered  necessary  to  avoid  a  repetition  of 
the  pattern  of  the  previous  recovery  period,  when  the  Federal  budget 
moved  from  a  deficit,  on  an  administrative  budget  basis,  of  $12.4 
billion  in  fiscal  1959  to  a  surplus  of  $1.2  billion  in  fiscal  1960.  This 
movement,  totaling  more  than  $13K  billion,  contributed  to  the  pre- 
mature termination  of  the  expansion  phase  of  the  business  cycle  in 
calendar  1960.  In  contrast,  the  budgetary  swing  planned  between 
fiscal  1962  and  fiscal  1963  would  total  only  about  $7}^  billion. 

The  administrative  budget. — For  fiscal  1963  budget  expenditures 
were  estimated  at  $92.5  billion  and  receipts  at  $93.0  billion.  Budget 
expenditures  were  expected  to  be  $3.4  bilhon  greater  than  in  fiscal 
1962,  with  more  than  three-fourths  of  the  increase  accounted  for  by 
additional  expenditures  for  national  defense,  international  affairs  and 

614359—62 2 


12    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

finance,  and  space  programs.  In  addition,  the  interest  cost  on  the 
public  debt  was  expected  to  be  $400  milHon  greater  than  in  fiscal  1962. 

The  rise  in  all  other  domestic  programs  was  estimated  at  less  than 
$400  miUion.  Budget  receipts  were  expected  to  rise  b}-  $10.9  billion 
from  fiscal  1962  to  fiscal  1963,  mainly  as  a  result  of  the  anticipated 
higher  levels  of  personal  income  and  corporate  profits  in  calendar  1962. 

Individual  income  taxes  were  expected  to  account  for  $49.3  billion 
of  the  total  revenues,  an  increase  of  $4.3  billion  over  fiscal  1962  levels. 
Corporate  tax  collections  were  expected  to  reach  $26.6  billion,  a  gain 
of  $5.3  billion  from  fiscal  1962.  Excise  taxes  were  estimated  at  nearly 
$10.0  billion;  estate  and  gift  taxes  at  $2.3  billion;  customs  collections 
at  $1.3  billion;  and  miscellaneous  receipts  at  $4.2  billion.  All  were 
expected  to  show  increases  over  1962. 

Cash  budget. — In  comparison  with  the  excess  of  cash  payments  over 
receipts  of  $8.5  billion  in  fiscal  1962,  cash  receipts  will  exceed  cash 
payments  by  $1.8  bilhon  in  fiscal  1963. 

National  ''ncome  and  product  accounts. — It  was  estimated  that  the 
Federal  Government  will  show  a  surplus  of  $4.4  billion  in  the  national 
income  and  product  accounts  in  fiscal  1963,  in  comparison  with  a 
deficit  of  $0.5  billion  in  fiscal  1962.  Purchases  of  goods  and  services 
in  the  national  income  and  product  accounts  were  expected  to  rise  by 
$4.0  billion,  transfer  payments  by  $1.6  billion  and  grants-in-aid  by 
$0.7  billion.  Net  interest  and  other  expenditures  were  expected  to 
decline  by  $0.5  billion.  Total  expenditures  were  estimated  to  rise 
by  $5.8  billion,  but  receipts  on  an  accrual  basis  were  estimated  to  in- 
crease by  $10.7  billion,  accounting  for  the  change  in  the  Government's 
net  position. 


DEBT  MANAGEMENT 

The  management  of  the  piibHc  debt,  which  now  totals  nearly  $300 
biUion,  is  one  of  the  major  responsibilities  of  the  Treasury  Department. 
Each  year  more  than  one-fourth  of  the  securities  maldng  up  the  total 
debt  come  due  and  must  be  replaced  with  new  issues  or  paid  off  in 
cash.  During  periods  when  Federal  Government  expenditures  are 
larger  than  receipts,  the  Treasury  must  go  into  the  financial  markets 
to  borrow  new  money  as  well.  As  a  result  of  the  highly  seasonal  pat- 
tern of  revenue  collections,  such  periods  may  occur  even  when  the 
Federal  budget  is  in  balance. 

Debt  management  policies 

Federal  debt  management  has  become  increasingly  complex, 
requiring  a  high  degree  of  coordination  with  the  closely  related 
operations  of  the  Federal  Keserve  System.  Its  objectives,  as  well 
as  the  techniques  by  which  those  objectives  are  carried  out,  have 
changed  with  the  American  economy  and  the  world's  financial  markets. 
The  objectives  have  evolved  from  a  simple  raising  of  money  to  pay  the 
Government's  bills  to  recognition  of  the  importance  of  debt  manage- 
ment in  fostering  economic  stability  and  a  healthy  and  sustained 
economic  growth.  Most  recently,  a  whole  new  dimension  has  been 
added  to  debt  management  objectives  by  the  emergence  of  inter- 
national balance-of-payments  considerations. 

Techniques,  too,  have  changed,  requiring  that  the  Treasury  seek 
new  means  to  achieve  debt  management  objectives:  New  types  of 
securities,  new  methods  of  marketing,  and  adaptations  of  other 
techniques. 

Despite  continuous  shifts  in  the  economic  environment  both  at 
home  and  around  the  globe,  debt  management  decisions  must  be 
made  in  the  light  of  certain  fundamental,  and  sometimes  conflicting, 
objectives.    Among  these  are: 

First,  to  raise  the  money  required  to  meet  the  Government's 
obligations. 

Second,  to  borrow  as  cheaply  as  possible,  consistent  with  meeting 
other  debt  management  objectives. 

Third,  to  make  sure  that  the  Government  carries  out  its  borrowing 
in  a  way  that  fosters,  rather  than  inhibits,  economic  stability  and 
sustained  growth  of  the  economy. 

13 


14    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Fourth,  to  conduct  debt  operations  in  such  a  way  as  to  try  to  avoid 
significant  international  interest  rate  differentials,  which  can  lead  to 
large  and  disruptive  flows  of  short-term  funds. 

Fifth,  to  work  toward  a  balanced  debt  maturity  structure,  in  order 
to  facilitate  the  orderly  managing  of  the  debt  in  future  3'ears.  This 
requires  maintenance  of  both  a  reasonable  volume  of  long-term 
securities  and  a  sufficient  supply  of  short-term  securities  to  meet  the 
needs  of  the  economy. 

The  problems  of  reconciling  and  achieving  these  various  goals  of 
debt  management  policy  were  manifest  throughout  the  calendar 
year  1961. 

The  total  borrowing  need  was  large.  Government  expenditures 
exceeded  Government  receipts  during  the  year  with  $6  billion  in  net 
new  borrowing  required.  Treasury  offerings  to  the  public  to  raise  new 
money  and  to  refinance  existing  obligations  at  maturity,  or,  in  some 
cases  in  advance  of  maturity,  totaled  more  than  $65  billion,  excluding 
the  weekly  rollover  of  maturing  Treasury  bills  which  amounted  to  $85 
billion. 

The  total  outstanding  debt  at  the  end  of  the  calendar  j-ear  was 
$296^  billion,  of  which  about  two-thirds,  or  $196  billion,  w^as  in 
marketable  issues  and  the  remainder  largely  in  special  issues  to  Gov- 
ernment investment  accounts  and  in  U.S.  savings  bonds  held  by 
individuals  and  others. 

As  the  Nation  moved  out  of  recession  and  into  recovery,  economic 
conditions  at  home  required  a  strong  flow  of  funds  into  private  in- 
vestment at  reasonable  long-term  interest  rates,  thus  limiting  the 
deskability  of  long-term  Treasury  borrowing. 

International  balance-of-pajanents  considerations  made  it  man- 
datory to  deter  the  outflow  of  funds  from  the  United  States  which 
might  have  occurred  if  short-term  interest  rates  had  been  allowed  to 
fall  to  the  low  levels  reached  in  other  recent  recession  and  early  re- 
covery periods.  This  required  an  increase  in  the  supply  of  the 
shortest  term  securities,  91-day  and  182-day  Treasur}^  bills  in  par- 
ticular. 

The  combined  needs  of  the  domestic  economy  and  the  balance-of- 
payments  situation— and  the  ever-present  fact  that  smiple  passage 
of  time  alone  will  shorten  the  maturity  of  the  over  one-year  debt  by 
one  full  year  each  year — made  mere  maintenance  of  the  average 
maturity  of  the  debt  a  most  difficult  task. 

The  conflicts,  seeming  and  real,  among  the  five  major  objectives  of 
debt  management  polic}^  were,  however,  resolved  and  the  funds  needed 
to  finance  new  debt  and  refinance  old  were  raised. 

With  the  cooperation  of  the  Federal  Reserve  System,  which  ac- 
tively entered  the  market  for  intermediate-  and  long-term  Govern- 


DEBT   MANAGEMENT  15 

ment  securities  for  the  first  time  in  a  decade,  short-term  interest  rates 
were  kept  at  sufficiently  high  levels  to  deter  large  outflows  of  money 
from  this  country,  and  an  adequate  volume  of  long-term  investment 
funds  was  encouraged,  at  reasonably  low  long-term  rates. 

While  the  outstanding  volume  of  Government  securities  maturing 
in  one  year  or  less  increased  by  $10?^  billion,  the  average  maturity  of 
the  debt  at  the  end  of  calendar  1961  remained  unchanged  from  the 
55-month  average  at  the  end  of  1960. 

The  total  cost  of  interest  on  the  debt  was  $8.9  billion  in  calendar 
1961  compared  with  $9.3  billion  in  the  previous  year. 

Debt  management  operations  in  1961 

A  broad  array  of  debt  management  techniques  was  required  to 
meet  these  difficult  debt  management  objectives  diu^ing  the  course 
of  the  calendar  year. 

Two  techniques  which  had  been  reintroduced  in  1960,  so-called 
advance  refunding  and  cash  refunding,  were  continued  with  marked 
success.  In  addition,  one  wholly  new  device,  the  offering  of  "strips" 
of  Treasury  bills,  was  inaugurated.  Use  of  six-month  and  one-year 
Treasury  bills,  which  had  first  been  offered  in  1958  and  1959,  respec- 
tively, and  which  have  now  become  a  fundamental  part  of  the  debt 
structure,  was  also  continued. 

Several  steps  were  also  taken  to  encourage  continuing  and  expand- 
ing ownership  of  Series  E  and  H  savings  bonds  with  the  result  that  at 
the  year's  end  the  outstanding  volume  of  these  bonds,  including  ac- 
crued interest,  had  risen  by  more  than  $1)^  billion  to  a  total  of  $44^ 
billion,  or  15  percent  of  the  total  public  debt.  New  sales  of  E  and 
H  bonds  increased  by  4  percent  over  1960  levels  and  redemptions  de- 
clined 10  percent. 

In  its  management  of  the  marketable  debt,  which  includes  most  of 
the  Federal  debt  except  savings  bonds  and  special  securities  issued 
to  Government  investment  accounts,  the  Treasury  concentrated  new- 
cash  financings  in  short-term  issues.  These  were  mainly  Treasury 
bills,  which  were  increased  from  $39 K  billion  outstanding  at  the  end 
of  1960  to  $43 j^  billion  outstanding  on  December  31,  1961.  The 
weekly  bill  maturities  were  increased  by  $4  billion  and  one-year  bills 
maturing  quarterly  were  increased  by  $1  billion.  (In  January  1962 
another  $500  million  was  added  to  the  one-year  bills  maturmg  m  that 
month,  bringing  each  of  the  four  quarterly  one-year  bill  maturities  up 
to  $2  billion.)  In  contrast  with  increases  in  the  weekl}^  and  quarterly 
bill  maturities,  the  Treasury  during  1961  cut  back  its  tax  anticipa- 
tion series  by  $1  billion  in  order  to  bring  total  outstanding  issues  of 
tax  anticipation  bills  more  closely  in  line  with  the  level  of  corporation 
tax  payments. 


16    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Except  for  small  additional  amounts  raised  in  the  course  of  refunding 
operations,  the  Treasury's  only  new-cash  financing  outside  of  the  bill 
market  was  the  reoffeiing  in  October  of  a  8)4  percent  note  maturing 
in  May  1963,  first  issued  in  May  1961.  A  total  of  more  than  $2% 
billion  was  raised  by  this  means. 

Debt  refinancing  operations  also  were  largely  confined  to  short- 
term  securities  during  the  first  half  of  the  calendar  year,  when  the  need 
to  encourage  the  nascent  upturn  in  the  economy  was  paramount. 
With  the  recovery  barely  underway,  Treasury  debt  operations  were 
designed  to  avoid  draining  off  long-term  funds,  which  otherwise 
would  be  available  for  private  investment,  from  the  financial  markets. 
This  complemented  the  open  market  operations  of  the  Federal  Reserve 
Svstem  involving  the  purchase  of  long-term  securities  from  the  public, 
offset  in  part  by  sales  of  short-torm  securities. 

The  Treasury,  therefore,  in  February  and  again  in  May  1961 
undertook  two  refinancings  of  maturing  debt  into  relatively  short- 
term  securities  through  the  cash  refunding  technique,  under  which 
maturing  securities  are  paid  off  directl}^  to  their  holders  and  new 
securities  sold  for  cash. 

In  a  cash  refunding,  unlike  the  more  traditional  "exchange  offering" 
method  of  refinancing  maturing  securities,  the  Treasury  can  control 
the  exact  amount  to  be  sold,  and  is  not  circumscribed  by  the  desires 
of  the  holders  of  the  maturing  issues  either  to  exchange  or,  conversely, 
to  demand  payment  in  cash.  Jn  these  two  cases,  the  Treasury 
obtained  a  moderate  amount  of  additional  cash — a  need  at  the  time 
in  view  of  the  Government  deficit — through  issuing  somewhat  more 
in  new  securities  than  it  paid  off  in  old  ones. 

Certificates  maturing  in  February  in  the  amount  of  $7  billion  were 
paid  off  and  a  new  issue  of  Ij-^-year  notes  was  sold,  totaling  slightly 
more  than  $7K  billion.  A  similar  operation  was  conducted  in  May 
when  $7%  billion  of  maturing  securities  were  paid  off  and  new  cash 
was  raised  through  the  issuance  of  $8)4  billion  of  short-term  securities, 
$5K  billion  of  one-3^ear  certificates  and  $2%  billion  of  two-year  notes. 

Significant  efforts  to  lengthen  the  debt  became  possible  in  the 
second  half  of  the  year,  with  the  business  recovery  firmly  established. 

In  July  an  exchange  offer  consisting  of  l-j^ear  3-nionth  notes, 
three-year  notes,  and  a  reopening  of  a  bond  maturing  in  1968  was  made 
to  holders  of  $12,'s$  billion  of  obligations  maturing  between  August 
and  October.  More  than  $11%  billion  of  new  securities  were  issued, 
including  $5  billion  of  the  three-year  notes  and  three-quarter  billion 
of  the  reopened  bonds. 

The  November  maturity  of  $7  billion  provided  another  opportunit}^ 
to  work  toward  a  balanced  debt  structure.  In  addition  to  one 
short-term  issue,  holders  of  the  maturing  securities  were  offered  two 


DEBT   MANAGEMENT  17 

bonds,  both  reopenings  of  earlier  issues,  one  maturing  in  1966  and  one 
maturing  in  1974.  In  all,  holders  of  $6K  billion  of  the  maturing  issue 
exchanged  their  obligations  for  new  securities  including  approximately 
$2)^  billion  of  the  shorter  bonds  and  one-half  billion  of  the  bonds 
maturing  in  1974. 

Some  further  debt  extension  was  accomplished  during  the  year  by 
means  of  an  exchange  offering  in  November  to  holders  of  approxi- 
mately $970  million  nonmarketable  Series  F  and  G  savings  bonds 
maturing  in  1962.  Owners  of  these  obligations  were  offered  in  ex- 
change marketable  Treasury  bonds  maturing  in  1968,  a  reopening 
of  bonds  first  offered  in  June  1960.  The  exchange  offer  was  accepted 
by  holders  of  approximately  $320  million  of  the  1962  F  and  G 
maturities. 

While  these  offerings  made  in  the  course  of  regular  refinancing 
operations  resulted  in  some  redistribution  of  the  debt,  the  major 
efforts  in  1961  toward  a  balanced  debt  structure  took  the  form  of 
refunding  of  obligations  in  advance  of  maturity,  that  is,  by  an 
"advance  refunding."  In  March  a  "junior"  advance  refunding  of 
relatively  short-term  issues  into  intermediate-term  securities  resulted 
in  the  exchange  of  $6  billion  of  securities  maturing  in  1962  and  1963 
for  obligations  maturing  in  1966  and  1967.  As  a  result,  the  crowding 
of  issues  in  the  one-to-two-year  maturity  range  was  relieved,  making 
room  for  other  new  or  refunding  issues  to  be  placed  in  that  area  later 
as  new  needs  arose.  In  September  1961,  a  "senior"  advance  refunding 
saw  holders  of  $3%  billion  of  intermediate-term  bonds  maturing  in 
1970  and  1971  take  advantage  of  an  offer  to  exchange  their  holdings 
for  longer  term  issues  maturing  between  1980  and  1998. 

As  a  result  of  this  advance  refunding,  there  was  a  net  increase 
over  the  year  of  almost  $2}^  billion  in  total  debt  obligations  having 
more  than  20  years  until  maturity.  The  reduction  of  the  volume  of 
issues  in  the  nine-to-ten-year  area  gave  added  flexibility  for  the  place- 
ment of  other  debt  in  that  maturity  sector,  if  market  conditions  and 
other  objectives  favor  such  a  possibility  later  on. 

An  entirely  new  debt  management  technique  was  used  on  two 
occasions  during  the  year  as  a  means  of  raising  additional  new  cash. 
This  was  the  offering  of  "strips"  of  Treasury  bills,  maturing  over  a 
series  of  consecutive  weeks.  The  strip  of  bills  offers  an  alternative 
to  the  device  of  weekly  increases  in  the  volume  of  regular  Treasury 
bills,  a  technique  which  was  also  used  frequently  during  the  year. 
A  strip  bill  offering  of  $1.8  bilhon  of  Treasury  bills  to  mature  over 
a  period  of  18  weeks  was  made  in  June,  followed  by  an  offering  in 
November  of  $800  million  of  bills  to  mature  over  an  8-week  period. 

Although  the  Treasury's  major  financing  operations  each  year 
necessarily  involve  marketable  issues,  nonmarketable  obligations,  and 


18    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

particularly  U.S.  savings  bonds,  are  an  important  element  in  the 
Government  debt.  Savings  bonds  owners  on  the  average  hold  their 
securities  for  7K  years,  a  considerably  longer  span  of  time  than  the 
average  length  of  the  outstanding  marketable  debt.  Thus  the  pur- 
chase of  savings  bonds  simplifies  the  Treasury's  complicated  problem 
of  restructuring  the  debt. 

The  first  step  taken  during  the  calendar  year  to  encourage  con- 
tinuing ownership  of  savings  bonds  was  the  announcement  in  March 
of  a  second  extension  of  Series  E  bonds  issued  from  Maj^  1941  through 
May  1949.  A  rate  of  3%  percent  per  yeox  compounded  semiannually 
is  payable  on  these  bonds  for  a  10-year  period  beginning  with  the 
date  on  which  the  bonds  reach  the  end  of  their  first  extended  ma- 
turity, 20  years  from  date  of  purchase. 

In  August  the  Treasury  announced  that  it  was  granting  an  extended 
maturity  on  current  income  savings  bonds  for  the  first  time.  Series 
H  bonds  issued  from  June  1952  through  January  1957  were  given 
a  10-year  extension,  with  interest  payable  during  the  extension 
period  at  the  rate  of  3%  percent  a  year. 

An  additional  action  to  encourage  investment  in  savings  bonds 
was  the  increase  from  $10,000  to  $20,000  in  the  amount  of  Series  H 
savings  bonds  which  can  be  purchased  in  any  one  year  by  a  single 
buyer. 

Debt  management  operations  early  in  1962 

At  the  outset  of  calendar  1962  the  Treasury  was  faced  with  the 
necessity  of  refinancing  or  paying  off  $56  billion  in  maturing  market- 
able securities,  not  counting  the  $30  billion  involved  in  the  refunding 
of  regular  weekly  Treasury  bills,  which  will  be  rolled  over  several 
times  during  1962.  It  also  faced  the  necessity  of  borrowing  new 
cash  from  time  to  time,  perhaps  as  much  as  $6)2  billion  in  the  first 
half  of  the  year  and  $12  billion  in  the  second  half. 

The  first  major  cash  borrowing  of  the  year  provided  $1  billion  to 
meet  the  Treasmy's  January  needs  through  an  offering  of  4  percent 
bonds  maturing  in  October  1969.  There  had  been  a  significant  reduc- 
tion in  the  supply  of  bonds  in  the  1970  maturity  area  as  a  result  of 
the  advance  refunding  of  the  previous  September.  This  helped  create 
a  market  for  the  January  offering.  It  illustrates  the  principle  that 
debt  management  is  a  continuous  process,  with  each  operation  neces- 
sarily related  to  the  sequence  of  future  operations. 

In  its  February  1962  refunding  the  Treasury  faced  the  task  of 
exchanging  $11%  billion  in  maturing  securities  for  new  obligations. 
Of  the  total  amount,  more  tlian  $6!^4  billion  was  publicly  lield;  that  is, 
in  the  hands  of  individual,  business,  and  institutional  investors  other 


DEBT   MANAGEMENT  19 

than  the  Federal  Reserve  Banks  and  Government  investment  accounts. 

Among  the  pohcy  objectives  which  required  careful  attention  were: 

First,  the  continuing  deficit  in  the  United  States  international 
balance  of  payments  indicated  that  any  impact  on  short-term  rates 
as  a  result  of  the  refinancing  ought  to  be  upward,  rather  than 
downward.  In  line  with  this,  a  one-year  security  with  an  attractive 
yield  of  3K  percent  was  offered. 

Second,  with  a  crowded  refinancing  schedule  ahead — in  particular 
the  unusually  large  May  and  June  maturities  totaling  more  than 
$15K  billion,  of  which  $13}4  billion  is  publicly  held — it  was  necessary 
to  maintain  flexibility  for  future  refundings.  This  consideration,  too, 
influenced  the  choice  of  a  one-year  security,  rather  than  a  somewhat 
longer  one  maturing  in  May  or  August,  as  the  short-term  offering  in 
the  February  exchange. 

Third,  with  a  restrictive  statutory  debt  ceiling  still  in  effect,  and 
balance-of-payments  considerations  indicating  that  it  might  be  desir- 
able in  the  near  future  to  exert  still  further  upward  pressure  on  the 
shortest  term  interest  rates  by  adding  again  to  the  supply  of  91-day 
bills,  it  was  not  possible  to  consider  raising  new  cash  in  this  refinancing. 
Thus  an  exchange  oftering  rather  than  a  cash  refunding  was  decided  on. 

Fourth,  in  order  to  achieve  some  overall  balance  in  the  maturity 
structure,  and  in  view  of  all  the  other  debt  in  the  shorter  term  area, 
it  was  desirable  to  offer  a  security  in  the  intermediate  range,  and  a 
4K-year  4  percent  note  was  offered. 

Fifth,  the  possibility  of  offering  a  long-term  bond  was  considered. 
The  decision  not  to  make  such  an  offering  at  that  time  was  based  in 
part  on  a  belief  that  lengthening  of  the  debt  structure  might  be 
accomplished  under  more  favorable  terms  and  with  much  less  impact 
on  the  financial  markets  and  on  interest  rates  at  a  later  time  through 
an  advance  refunding.  It  appeared  that  selling  a  long-term  security 
would  have  required  a  very  favorable  interest  rate,  one  which  might 
have  exerted  upward  pressure  on  other  long-term  rates.  With  the 
domestic  economy  still  operating  at  less  than  capacity  and  unemploy- 
ment still  in  excess  of  5%  percent,  it  seemed  unwise  to  offer  the  option 
of  a  long-term  investment. 

Throughout  1962  the  Treasury  intends  to  make  its  needs  and 
intentions  laiown  to  the  financial  markets  and  the  public.  Treasury 
actions  are  necessarily  significant  elements  in  the  market  process. 
This  fact  was  recognized  at  the  outset  of  1961  when  both  domestic  and 
international  demands  indicated  a  need  to  maintain  short-term  rates  at 
relatively  high,  and  even  rising  levels,  and  to  maintain  long-term  rates 
at  a  reasonably  low  level.     This  dual  objective  was  not  kept  secret. 


20    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Similarly,  late  in  1961,  the  intention  of  the  Treasury  was  made  known 
when  it  became  evident  that  it  would  be  desirable  if  the  short-term 
bill  rate,  which  had  been  moving  in  a  range  of  2}^  to  2}^  percent,  should 
edge  upwards  to  the  2%  percent  level  to  prevent  the  emergence  of 
significant  interest  rate  differentials  here  and  abroad. 

To  the  maximum  extent  feasible,  indications  wUl  continue  to  be 
given  as  to  the  direction  in  which  the  influence  of  Treasury  debt 
management  actions  will  be  working. 


TAX  POLICY 

The  direct  and  important  influence  of  the  Federal  tax  system  upon 
the  national  economy  is  demonstrated  by  the  impact  of  tax  considera- 
tions on  individual  and  business  decisions  as  well  as  the  very  magnitude 
of  tax  receipts.  In  the  calendar  year  1961,  some  100  million  individual 
taxpayers,  with  a  total  of  70  million  dependents,  filed  personal  income 
tax  returns.  They  paid  $42.4  billion  in  income  taxes.  Corporations 
paid  $20.3  billion.  These  two  major  sources  produced  more  than 
four-fifths  of  the  total  of  the  more  than  $75  billion  in  budget  receipts 
from  taxes.  The  remainder  came  from  excise  taxes,  estate  and  gift 
taxes,  and  customs  collections.  An  additional  $15  billion  in  excise 
and  employment  taxes  went  to  trust  funds  to  finance  Federal  high- 
way, social  security,  and  other  programs. 

In  all.  Federal  tax  receipts  exceeded  $90  billion,  the  equivalent  of 
17.3  percent  of  our  gross  national  product. 

Objectives  of  tax  policy 

Tax  policies  are  of  concern  to  all — as  they  should  be.  Taxes  im- 
portantly influence  mjrriad  economic  decisions,  and  play  a  significant 
role  in  determining  the  level  of  economic  activity,  the  distribution  of 
income,  and  competitive  business  relationships.  Tax  policies  also 
affect  the  value  of  our  money,  our  balance  of  international  payments, 
and  the  rate  at  which  our  economy  grows.  Among  the  many  im- 
portant elements  to  consider  in  determining  tax  policy  are: 

Adequacy — ^to  meet  the  Government's  needs  for  revenues. 

Vitality — to  assure  that  the  tax  system  enhances,  rather  than 
inhibits,  economic  efficiency,  growth,  and  stability. 

Equity — ^to  achieve  fairness  as  between  different  taxpayers. 

Neutrality — -to  insure  that  taxes  do  not  artificially  influence 
economic  decisions. 

Simplicity — to  make  possible  taxpayer  understanding  of  tax  laws, 
and  effective  and  economical  tax  administration. 

A  basic  objective  is  to  maintain  a  tax  system  that  permits  us  to 
meet  our  public  needs.  Adequate  revenues  are  required  to  maintain 
our  defenses,  support  our  international  commitments,  provide  the 
public  services  required  of  the  Federal  Government,  and  to  finance 
these  activities  in  a  manner  that  maintains  full  confidence,  at  home 
and  abroad,  in  the  management  of  our  fiscal  affairs. 

21 


22    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Adequacy  does  not  mean  that  revenues  must  always  equal  expendi- 
tures. It  refers,  rather,  to  the  capacity  of  the  tax  system  to  supply 
revenues  in  the  amounts  necessary  to  finance  expenditures  without 
adverse  economic  consequences.  In  some  circumstances  revenues 
should  exceed  expenditures  to  produce  a  budgetary  surplus;  in  others, 
a  deficit  is  appropriate. 

The  overall  revenue  jdeld  of  the  tax  system  at  different  levels  of 
business  activity  is  a  major  test  of  its  economic  effectiveness — the 
second  major  objective  of  tax  policy.  If  the  tax  system  is  to  make  a 
significant  contribution  to  economic  stability,  it  must  be  responsive 
to  changes  in  business  conditions.  The  total  tax  yield  should  decline 
more  than  total  income  in  time  of  recession,  so  that  the  impact  of  the 
recession  on  disposable  income  is  moderated.  The  reverse  should 
occur  in  a  time  of  rapid  economic  expansion  and  inflationary  threat. 

In  addition  to  contributing  to  economic  stability,  tax  policy  also 
influences  the  rate  of  economic  growth.  Our  tax  laws  can,  for  example, 
contribute  to  growth  by  increasing  the  attractiveness  of  investment 
in  new  productive  equipment.  They  can  also  inhibit  growth  by 
making  certain  t^^pes  of  less-productive  activity  more  attractive  than 
other,  more  economically  valuable,  undertakings. 

A  third  major  goal  of  tax  policy  is  equit}'.  Each  person  should 
contribute  his  appropriate  share  to  the  cost  of  Government,  and  he 
should  feel  confident  that  others  are  doing  so  as  well. 

Opinions  ysltj  as  to  what  is  fair  or  equitable  in  the  application 
of  particular  taxes,  but  there  are  some  generally  accepted  principles 
of  tax  fairness. 

One  is  "horizontal"  equity:  persons  with  equal  incomes  and  similar 
circumstances  should  pay  equal  taxes. 

A  second  is  "vertical"  equity:  as  income  increases,  the  proportion 
that  goes  into  taxes  should  rise.  The  effectiveness  and  efficiency 
of  our  income  tax  laws,  which  are  to  a  considerable  extent  subject 
to  voluntary  compliance,  depend  upon  a  general  belief  that  each 
individual's  share  of  the  tax  burden  is  just,  and  that  others  are  not 
escaping. 

In  applying  standards  of  equity,  our  tax  laws  recognize  variations 
in  taxpayers'  circumstances.  In  some  instances,  departures  from 
uniform  rules  may  be  the  means  of  achieving  important  public  pur- 
poses. But  tax  equity  requires  that  special  tax  provisions  be  care- 
fully considered.  They  are  justified  only  when  real  and  significant 
differences  exist  between  taxpayers'  situations,  or  when  there  is  no 
better  way  of  attaining  a  compelling  national  objective  than  by 
exceptional  tax  rules. 

Related  to  the  concept  of  tax  equit}^  is  that  of  tax  neutrality 
Tax  rates  should  apply  uniformly  and  without  discrimination  be- 


TAX    POLICY  23 

tween  individuals,  between  businesses,  and  between  the  ways  in 
which  similarly  situated  individuals  choose  to  conduct  their  economic 
affairs. 

Simplicity  is  also  a  basic  objective  of  tax  policy.  In  a  complex 
modern  society  there  may  be  conflicts  between  simplicity  and  other 
objectives.  But  in  evaluating  our  tax  policies,  simplicity  is  an  impor- 
tant consideration.  Otherwise,  the  tax  system  becomes  virtually 
incomprehensible,  compliance  becomes  increasingly  burdensome, 
and  expensive  enforcement  processes  are  required. 

Conformity  of  the  present  system  with  tax  policy  objectives 

In  the  light  of  these  objectives,  there  are  manj^  features  of  our  tax 
structure  that  need  revision  to  meet  changing  social,  economic,  and 
international  conditions,  and  to  improve  tax  equity.  For  example, 
as  health,  welfare,  and  other  programs  grow,  some  features  of  the 
tax  system — initiated  in  support  of  welfare  goals — should  be  re- 
examined. Similarly,  important  features  of  our  tax  structure,  im- 
posed in  wartime  to  meet  special  needs,  are  no  longer  consistent  with 
our  objectives. 

Special  preferences  for  some  taxpayers  invite  claims  by  others 
for  similar  relief.  Wlien  some  taxpayers  are  permitted  to  pay  less, 
others  must  inevitably  pay  more  if  revenues  are  to  be  maintained. 
Special  provisions  create  inequity,  add  to  the  complexity  of  tax  law 
and  tax  forms,  and  hamper  taxpayer  understanding  and  compliance. 

Differences  in  the  treatment  of  income  from  different  sources  affect 
business  and  investment  decisions  and  distort  the  allocation  of  eco- 
nomic resources.  Not  the  least  of  these  distortions  is  the  pursuit  of 
special  treatment,  which  diverts  attention  from  ordinary  business 
decisions  to  opportunities  for  the  legal  avoidance  of  tax  liabilities. 

How  the  tax  system  should  be  changed 

1961  tax  proposals. — Our  present  tax  system  is  not  contributing 
enough  to  an  improved  rate  of  economic  growth.  To  meet  the  re- 
quirements of  a  growing  population  and  labor  force,  to  increase  per 
capita  income,  and  to  raise  employment  levels,  we  need  a  larger 
volume  of  capital  formation.  Modernization  of  plant  and  equipment 
must  be  accelerated  if  we  are  to  increase  productivity  and  enable 
our  industries  to  compete  more  effectively  in  international  markets, 
thus  lessening  the  pressure  on  our  balance  of  payments. 

To  this  end,  the  President  recommended  a  tax  credit  for  investment 
in  machinery  and  equipment.  The  presently  planned  tax  credit  of 
8  percent  will  afford  substantial  encouragement  for  increased  invest- 
ment. This  form  of  incentive  achieves  a  greater  stimulus  to  invest- 
ment per  dollar  of  revenue  loss  than  would  the  available  alternatives. 


24  AKNTJAL    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 

The  administration  has  also  recognized  that  guidelines  for  depreci- 
ation deductions  require  revision  if  they  are  to  reflect  economic  and 
technological  changes  which  affect  obsolescence.  Priority  in  these 
revisions  has  been  given  to  textile  machinery,  in  keeping  with  a 
Presidential  directive,  but  new  and  simplified  depreciation  schedules 
for  all  other  industries  will  be  announced  in  the  spring  of  1962.  With 
more  realistic  tax  allowances  for  depreciable  propert}^,  American 
industry  will  be  in  a  better  position  to  maintain  the  most  modern 
industrial  plant  in  the  world. 

The  investment  credit  was  one  part  of  the  set  of  urgently  needed 
legislative  reforms  recommended  by  the  President  in  his  April  20, 1961, 
tax  message  to  the  Congress.  The  President  also  recommended 
statutory  changes  in  taxation  that  will  yield  the  revenues  needed  to 
offset  the  loss  resulting  from  the  investment  credit.  These  changes 
will  also  remove  certain  obvious  defects  and  inequities  in  the  tax 
structure. 

One  necessary  area  of  revision  is  the  tax  treatment  of  income  from 
foreign  sources.  The  recommended  amendments  would  serve  the 
overall  objective  of  tax  neutrality  between  domestic  and  foreign 
operations  by  eliminating  the  existing  privilege  of  deferring  tax  pay- 
ments on  earnings  from  man}^  types  of  overseas  operations  imtil  such 
time  as  those  earnings  are  returned  to  this  countr}''.  The  administra- 
tion's proposals  would  also  remove  the  adverse  effect  on  our  balance 
of  payments  which  now  results  from  the  artificial  tax  inducement  to 
overseas  investment.  Specifically,  the  recommendations  would  per- 
mit tax  deferral  privileges  for  profits  earned  in  developing  countries 
only  and  tighten  the  tax  treatment  of  other  foreign  income.  These 
involve  tax  haven  operations;  taxation  of  U.S.  shareholders  in  foreign 
investment  companies;  taxation  of  American  citizens  residing  abroad; 
estate  tax  on  real  property  located  abroad;  computation  of  allowances 
for  foreign  tax  credits  on  dividends;  taxation  of  foreign  trusts;  and 
additional  information  with  respect  to  certain  foreign  corporations 
controlled  by  Americans. 

Statutory  changes  are  also  necessary  to  cope  with  abuses  of  business 
deductions  for  entertainment,  gifts,  and  other  expense  account  items. 
Business  deductions  for  entertainment,  vacations,  club  dues,  and 
luxurious  travel  too  froquentl}^  provide  purely  personal  benefits. 
Use  of  such  deductions  severel}^  discriminates  against  the  average 
taxpayer,  who  must  meet  liis  personal  expenses  out  of  income  after 
tax,  thereby  undermining  general  confidence  in  the  fairness  of  our  tax 
system.  Successive  administrative  eft'orts  under  present  law  have 
not  succeeded  in  ending  abuses.  More  definite  and  enforceable 
statutory  provisions  were  recommended  as  the  effective  remedy. 


TAX    POLICY  25 

Corrective  legislation  is  also  needed  with  respect  to  the  tax  treat- 
ment of  profits  on  sales  of  depreciable  property  to  the  extent  of  prior 
depreciation.  Proper  taxation  of  this  income  has  become  more 
m*gent  than  ever,  in  view  of  the  administration's  plans  to  revise  de- 
preciable lives  and  its  legislative  proposal  to  liberalize  treatment  of 
salvage  value  in  determining  depreciation.  Profits  from  sales  of 
depreciable  property  should  be  treated  as  ordinary  income,  and  the 
administration  has  recommended  accordingly  that  they  be  taxed  as 
ordinary  income  to  the  extent  of  depreciation  allowed  after  December 
31,  1961. 

Under  present  law  several  types  of  business  institutions  enjoy  un- 
warranted tax  preferences.  Recommendations  were  made:  To  insure 
that  either  cooperatives  or  their  patrons  pay  taxes  currently  on  earn- 
ings which  reflect  business  activities;  to  repeal  special  provisions  now 
applicable  to  the  operating  income  of  mutual  fire  and  casualty  insur- 
ance companies;  and  to  amend  the  deductible  reserve  provisions 
applicable  to  mutual  savings  banks  and  savings  and  loan  associations 
to  assure  nondiscriminatory  taxation  among  competmg  financial 
institutions. 

The  privileged  treatment  of  dividend  mcome  enacted  in  1954  has 
not  proved  to  be  effective  in  fostering  additional  capital  investment 
and  it  unduly  favors  the  upper  bracket  taxpayer.  Repeal  was  recom- 
mended for  both  the  exclusion  from  an  individual's  income  of  the 
first  $50  of  dividends  and  the  credit  against  tax  of  4  percent  of  addi- 
tional dividends. 

A  system  of  tax  withholdmg  on  dividends  and  interest  was  recom- 
mended to  overcome  the  serious  loss  of  revenue  and  the  unfairness 
that  result  from  the  failure  of  some  individuals  to  report  these  types 
of  income  on  their  tax  returns.  It  has  become  clear  that  this  gap  in 
tax  payments  cannot  be  closed  by  taxpayer  educational  programs  nor 
by  attempts  to  apply  other  collection  techniques  to  the  millions  of 
separate  dividend  and  interest  transactions.  An  automatic  system 
similar  to  tax  withholding  for  employee  compensation  is  essential. 

The  President  has  recommended  that  Congress  grant  him  the 
authority  to  adjust  personal  income  tax  rates  downward  by  as  much 
as  5  percentage  points,  subject  to  congressional  disapproval.  This 
discretionary  tax  flexibility  is  needed  as  a  means  of  facilitating  the 
achievement  of  the  objectives  of  the  Emplo^onent  Act  of  1946. 
Without  it  the  tax  structure  is  incapable  of  contributing  as  much 
as  it  should  to  the  attainment  of  economic  stability. 

Steps  were  taken  in  1961  to  improve  tax  administration.  Legis- 
lation was  enacted  to  authorize  the  use  of  taxpayer  account  numbers 
to  improve  enforcement  and  collection  of  taxes.  The  account  number 
system  will  facilitate  a  greatly  expanded  use  of  automatic  data  process- 


26    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

ing  equipment  by  the  Internal  Revenue  Service.  This  will  make 
possible  the  assembling  of  a  single  file  of  all  tax  data  for  any  one 
taxpaj'er  as  an  essential  part  of  a  modern  administrative  system. 

As  a  result  of  the  President's  recommendations,  the  Congress  also 
increased  appropriations  for  the  Internal  Revenue  Service  to  add 
personnel  and  expand  tax  enforcement  programs.  The  President 
directed  the  Internal  Revenue  Service  to  give  particular  attention 
to  methods  of  inventory  reporting  and  to  the  broadening  of  tax 
audit  coverage. 

Strengthening  of  administration  increases  revenues,  and  maintains 
general  confidence  that  tax  laws  are  being  uniformly  and  vigorously 
enforced. 

Elements  of  more  comprehensive  tax  reform 

In  accordance  with  a  Presidential  directive,  the  Treasmy  is  prepar- 
mg  a  more  comprehensive  tax  reform  program.  Studies  are  underway 
on  the  manner  in  which  existing  tax  provisions  operate,  and  their 
probable  effects  on  the  economy  and  on  the  distribution  of  tax  liabil- 
ities. These  studies  are  providing  a  factual  and  anal3^tical  basis  for 
tax  reform  proposals  consistent  with  our  general  policy  objectives. 
Legislative  proposals  will  be  presented  to  the  Congress  prior  to 
adjom-nment  of  its  1962  session. 

Attention  will  be  directed  first  to  the  income  taxes,  corporate  and 
personal,  but  it  is  recognized  that  the  estate  and  gift  taxes  and  the 
excise  taxes  also  demand  attention.  As  we  proceed  with  the  reform 
program,  proposals  in  these  areas  will  be  offered. 

The  studies  now  in  progress  involve  an  intensive  investigation  of 
the  operation  and  effects  of  current  exclusions  from  income,  deduc- 
tions, and  credits.  The  general  purpose  is  to  determine  where  and  in 
what  manner  the  income  tax  base  might  properly  be  broadened  and 
unwarranted  special  preferences  eliminated.  Broadening  of  the  tax 
base  will  permit  significant  reductions  of  tax  rates  without  sacrifice  of 
tax  revenues.  Possible  changes  are  being  carefully  evaluated  in  terms 
of  tax  equity,  neutrality,  simplification,  and  the  contribution  thej' 
can  make  to  our  national  goals,  including  improved  growth  and 
efficiency  of  our  free  enterprise  economic  system. 

Continuing  study  is  also  being  given  to  the  most  feasible  means  of 
strengthening  the  countercycHcal  effects  of  the  tax  system  on  the 
economy.  We  need  to  make  the  tax  system  more  responsive  to 
changes  in  levels  of  income,  unemplo3anent,  profits,  and  sales.  Only 
if  we  succeed  in  mitigating  the  excessive  swings  of  our  economy  will 
we  be  able  to  attain  the  steady,  healthy,  and  prolonged  economic 
growth  we  need  to  achieve  our  true  potential. 


INTERNATIONAL  FINANCE 

I.  BALANCE  OF  PAYMENTS 

Shortly  after  taking  office,  the  President  outhned  in  a  special 
message  to  the  Congress  a  broad  and  energetic  attack  on  the  balance- 
of-payments  problem  facing  this  country.  In  response  to  the  clear 
and  urgent  need  a  wide  variet}^  of  measures  have  been  introduced  and 
pursued  with  vigor  by  all  agencies  concerned.  At  the  President's 
direction,  the  Secretary  of  the  Treasury  assumed  special  responsibility 
for  continuous  review  of  all  these  activities,  and  for  reporting  to  him 
at  frequent  intervals  on  the  status  of  our  international  accounts. 
This  is  an  appraisal  of  progress  over  the  past  year,  and  of  the  hard 
tasks  that  still  lie  ahead. 

During  1961,  the  immediate  pressures  apparent  at  the  time  the 
administration  took  office  were  relieved.  Confidence  in  the  dollar 
was  strengthened;  the  gold  outflow  slowed;  and  the  deterioration  in 
our  world  competitive  position  arrested.  Nevertheless,  the  task  of 
eliminating  our  balance-of-payments  deficit  has  only  begun.  Until 
it  is  finished,  we  cannot  rest  easy. 

The  main  responsibility  for  righting  our  deficit  lies  in  the  sustained 
efforts  of  Government,  business,  and  labor.  But  the  cooperation  of 
other  free  countries  is  also  essential  if  we  are  to  build  a  stronger  inter- 
national fuiancial  sj^stem.  That  sj^stem  must  be  capable  not  only  of 
supporting  and  nourishing  expanded  trade  among  the  free  nations  but 
also  of  withstanding  the  strains  and  pressures  that  are  an  inevitable 
part  of  progress. 

The  results  of  our  efforts  thus  far  have  been  good  enough  to  justify 
confidence  that  we  have  made  the  right  start;  they  are  not  so  good  as 
to  justify  complacency.  Part  of  our  improvement  in  1961  came  from 
palliatives,  and  palliatives  must  be  continued  in  1962.  But  the  cure 
has  also  begun  to  work,  and  it  can  be  a  lasting  cure,  as  long  as  we 
recognize  that  it  can  be  neither  simple  nor  painless. 

Full  success  will  require  time.  The  necessary  time  is  ours — if  we 
use  it  effectively.  Today  the  dollar  is  still  strong,  bulwarked  by 
over  40  percent  of  the  monetary  gold  stock  of  the  free  world.  Time 
will  not  be  our  ally  if  we  waste  it,  for  then  confidence  will  be  shaken, 
the  basis  for  essential  cooperation  among  the  leading  financial  powers 
lost,  and  the  future  will  be  in  doubt. 

27 

614359—62 3 


28    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  nature  of  the  problem 

In  1961,  our  basic  accounts,  which  sum  up  all  our  recorded  trans- 
actions with  foreigners  except  flows  of  short-term  capital,  were  in 
deficit  to  the  extent  of  $600  million,  a  substantial  reduction  from  the 
basic  deficits  of  $1.9  bilhon  in  1960  and  $4.3  bilhon  in  1959.  This 
reduction  reflected  both  a  larger  export  surplus  and  reduced  net 
payments  abroad  on  Government  account — progress  in  the  directions 
we  must  move.  But  it  is  clear  that  our  progress  did  not  stem  entirely 
from  factors  of  a  lasting  sort. 

The  large  surplus  of  over  $3  billion  in  our  trade  accounts,  excluding 
those  exports  financed  by  Government  grants  and  capital,  resulted  in 
part  from  the  low  import  levels  that  accompanied  the  recent  recession. 
In  addition,  special  debt  prepayments  to  the  United  States — by  the 
Federal  Republic  of  Germany,  the  Netherlands,  the  Philippines,  and 
Italy — contributed  almost  $700  million  to  our  receipts,  a  much  larger 
amount  than  can  be  expected  year  after  year.  Because  these  special 
factors  were  concentrated  in  the  early  part  of  the  year,  our  basic 
deficit  increased  appreciably  during  the  final  six  months. 

Moreover,  on  top  of  the  basic  deficit,  short-term  capital  continued  to 
flow  abroad  in  amounts  only  slightly  less  than  during  1960.  These 
flows  were  much  less  disturbing  than  in  1960,  when  speculation  against 
the  dollar  developed.  They  did  not  reflect  or  arouse  the  same  doubts 
over  the  future  of  the  dollar.  Instead,  more  of  the  outflow  in  1961 
consisted  of  commercial  credits  to  other  countries,  which  helped  to 
support  a  continued  expansion  of  trade.  But  this  was  only  part  of 
the  cause,  and  in  1961  the  size  of  the  short-term  capital  outflow 
clearly  aggravated  our  problem. 

Altogether,  our  deficit  in  1961  amounted  to  nearl}"  $2.5  biflion. 
Wliile  sharply  below  the  average  of  $3.7  billion  for  the  three  previous 
years,  this  is  still  far  from  our  target  of  equilibrium  in  our  inter- 
national accounts.  A  deficit  of  the  proportions  of  1961  could  be,  and 
was,  financed  without  placing  new  strains  on  the  monetary  system 
only  because  confidence  in  the  dollar  was  strong  and  our  determination 
to  meet  our  problem  was  apparent. 

A  little  over  a  third  of  our  deficit  in  1961,  or  $857  million,  was  re- 
flected in  gold  sales  from  our  monetary  stocks.  Of  this,  $324  million 
was  purchased  by  foreigners  in  the  single  montli  of  January,  before 
the  President  had  made  clear  the  determination  of  tliis  administration 
to  maintain  the  value  of  the  dollar  and  to  take  the  vigorous  measures 
necessary  to  restore  a  balance  to  our  international  accounts  Avithout 
resort  to  direct  controls  or  restrictions. 

Our  ability  to  finance  our  deficit  in  1961  cannot  be  permitted  to 
obscure  the  nature  of  the  continuing  problem  before  us.  This 
country  is  agreed  on  its  vital  responsibilities  for  leadership  in  the 


INTERNATIONAL   FINANCE  29 

defense  of  the  free  world  and  for  assisting  the  developing  nations  to 
find  a  better  life  in  free  societies.  But  it  is  not  always  understood 
that  these  burdens  cannot  be  carried  if  we  do  not,  over  a  series  of  years, 
earn  a  larger  surplus  in  our  commercial  accounts. 

Equally  important  is  the  fact  that  a  sound  dollar  is  essential  to  the 
strength  and  stability  of  the  whole  international  monetary  system, 
and  thus  a  vital  concern  to  all  our  allies  and  trading  partners.  Ameri- 
can dollars,  side  by  side  with  gold,  are  a  part  of  the  basic  reserves  of 
nearly  every  country  in  the  free  world.  They  use  dollars  to  finance 
much  of  their  worldwide  trade,  to  pay  for  shipping  and  transportation, 
and  to  support  their  foreign  investment  or  borrowing.  It  is  this 
universal  acceptability  of  the  dollar  as  a  reserve  and  trading  currency 
that  has  made  possible  a  vast  expansion  in  world  trade. 

The  dollar  can  continue  to  perform  these  functions  only  so  long  as  it 
is  reliable.  It  must  be  immediately  reliable  as  a  currency  that  can  be 
converted  into  gold  at  a  fixed  price.  It  must  be  ultimately  reliable 
as  a  solid  claim  on  the  enormous  and  richly  varied  resources  of  our 
abundant  economy,  a  claim  undiluted  by  inflation,  creeping  or   rapid. 

The  broad  challenge  before  us  is  to  maintain  the  value  of  the  dollar 
unquestioned,  and  to  do  so  without  impairing  our  vital  domestic 
objectives,  the  strength  of  our  mutual  defense,  or  our  ability  to  assist 
the  less  fortunate  nations  along  the  path  to  prosperity  and  freedom. 
These  tasks  are  mutually  reinforcing.  We  cannot  afford  to  neglect 
one  for  another,  for  only  when  our  economy  is  expanding  at  home,  our 
defenses  strong,  and  the  poorer  countries  are  making  visible  progress 
can  we  command  the  sort  of  confidence  in  oiu-  own  future  that  is 
necessary. 

The  overall  objectives 

Om-  programs  and  policies  to  maintain  the  strength  of  the  dollar 
within  a  framework  of  free  and  expanding  markets  at  home  and 
abroad  are  focused  on  two  broad  and  related  objectives: 

First,  we  must  eliminate  the  deficits  in  our  international  accounts, 
taking  the  good  years  and  the  bad  together,  so  that  prolonged  and 
excessive  drains  on  our  own  reserves  cease.  This  will  requu'e,  above 
all,  that  we  achieve  a  still  larger  commercial  surplus  by  competing 
more  vigorously  with  producers  of  other  countries  both  in  foreign 
markets  and  at  home.  It  also  requires  that  we  reduce  our  net  pay- 
ments to  other  countries  on  Government  account  to  the  minimum 
required  by  national  security  and  economic  development  objectives. 
And,  we  must  eliminate  from  our  tax  system  artificial  incentives, 
grounded  in  neither  equity  nor  economic  efficiency,  to  moving  capital 
abroad. 


30    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Second,  on  this  firm  base,  we  must  build  a  stronger  framework  of 
mutual  cooperation  among  governments  and  monetary  authorities. 
Acting  with  our  partners,  we  must  be  able  to  defend  the  international 
monetary  structure  from  speculative  excesses  and  other  strains.  In 
particular,  while  allowing  short-term  funds  to  move  freely  from  coun- 
try to  country  in  accordance  with  private  initiative,  we  must  make  it 
impossible  for  sudden  and  capricious  movements  to  undermine  the 
stability  of  the  payments  system. 

To  achieve  these  objectives,  the  energies  and  resources  of  all  agencies 
of  the  U.S.  Government  have  been  mobilized  to  specific  tasks  in  the 
areas  of  then'  responsibilities.  To  assure  that  the  proper  priorities 
are  maintained  and  the  appropriate  sense  of  m-gency  prevails  through- 
out Government,  the  Secretary  of  the  Treasury  has,  under  the  Presi- 
dent's authority,  established  procedm"es  for  continuous  review  of  all 
these  activities.  Full  reports  on  the  actions  of  the  Government  depart- 
ments and  agencies  involved  are  prepared  for  the  President's  review 
at  least  once  ever}'  three  months.  Special  measures  being  taken  or 
needed  throughout  the  Government  to  overcome  our  balance-of- 
payments  problem  are  brought  to  his  attention  promptly,  and  he  has 
issued  a  series  of  directives,  and  sent  to  Congress  a  number  of  proposals 
to  intensify  and  coordinate  these  efforts. 

Eliminating  the  deficit 

The  balance  of  payments  is  made  up  of  countless  individual  trans- 
actions, each  responding  to  a  wide  variety  of  factors.  Among  these 
factors,  some  are  under  the  direct  control  of  Government;  others  reflect 
the  performance  of  our  whole  domestic  economy;  and  still  others  the 
policies  and  performance  of  other  nations.  Amid  these  complexities, 
there  can  be  no  satisfactory  single  solution  to  the  deficit.  What  is 
needed  is  a  concerted  effort  on  all  fronts — by  the  Government, 
business,  labor,  and  finance  in  this  country  and  by  other  leading 
countries  as  well,  particularly  those  whose  balance-of-pa}mients 
surpluses  represent  the  opposite  side  of  our  deficit. 

Immediate  measures. — ^The  first  line  of  attack  on  the  balance-of- 
payments  deficit  consists  of  measures  to  curtail  the  outflow  of  dollars 
stemming  from  the  activities  of  Government  itself.  Many  of  these 
measures  are  now  well  advanced,  and  contributed  to  the  improvement 
in  1961.  Others  are  just  now  becoming  effective,  and  should  provide 
needed  help  during  1962.  But  still  more  can  be  and  is  being  done  to 
assure  that  all  Government  programs  are  fully  adjusted  to  current 
needs. 

The  Secretary  of  Defense  is  conducting  negotiations  with  certain 
of  our  allies  to  offset,  through  the  purchase  by  them  of  additional 
U.S.  military  equipment  and  services,   the  heavy  paymients  which 


INTERNATIONAL  FINANCE  31 

we  must  make  to  maintain  and  support  American  forces  in  countries 
participating  in  the  common  defense.  Expenditures  for  defense 
purposes  overseas  were  close  to  $3  billion  in  1961.  It  is  expected 
that  our  total  sales  of  military  equipment  and  services  will  result  in 
pa3mients  to  the  United  States  of  more  than  $1  billion  in  the  calendar 
year  1962,  compared  with  less  than  half  as  much  in  1961.  This  will 
help  greatly  in  reducing  our  1962  deficit. 

The  Defense  Department  has  also  directed  the  return  of  pro- 
curement to  U.S.  sources  of  a  portion  of  the  major  equipment,  supplies, 
and  services  formerly  purchased  in  foreign  countries  for  the  use  of  our 
armed  forces  overseas.  It  is  streamlining  overseas  deployments  and 
pruning  installations  with  a  view  to  conserving  dollars  within  the 
framework  of  our  defense  requirements.  Military  and  civilian 
personnel  and  then'  dependents  are  being  urged  to  reduce  their 
personal  expenditures  overseas  and  to  channel  theu'  family  savings 
into  U.S.  saving  bonds  and  other  American  securities  or  savings 
institutions. 

In  our  economic  assistance  programs  we  are  reducing  the  portion 
transferred  to  foreign  countries  in  the  form  of  dollars  rather  than 
U.S.  goods  and  services.  Conversely,  the  share  of  our  aid  transferred 
in  the  form  of  U.S.  goods  and  services  is  being  increased.  Because  a 
substantial  part  of  current  expenditures  stems  from  commitments 
made  under  earlier  policies,  the  full  results  of  the  new  emphasis  have 
not  yet  been  reflected  in  the  balance-of-payments  data.  Approxi- 
mately two-thirds  of  the  funds  expended  for  all  our  foreign  economic 
assistance  programs  in  1961  (including  foreign  currency  sales  of 
agricultural  surpluses)  were  initially  utilized  for  expenditure  in  the 
United  States.  The  portion  spent  in  this  country  will  increase  as  pro- 
curement orders  under  present  directives  become  more  fully  reflected 
in  our  balance  of  payments.  Ways  are  being  developed  to  reduce 
still  further  the  impact  of  economic  assistance  on  our  balance  of  pay- 
ments without  damage  to  the  objectives  of  the  program  of  the  Agency 
for  International  Development. 

Our  program  for  bartering  agricultural  surpluses  under  Public 
Law  480  is  being  reexamined  to  make  sure  it  will  not  adversely  affect 
the  balance  of  payments  of  the  United  States.  The  danger  is  that, 
in  some  instances,  potential  export  sales  for  dollars  may  be  diverted 
into  barter  arrangements  that  return  to  this  country  imports  for 
which  there  is  no  current  need.  This  problem  should  be  recognized 
in  any  modification  of  legislation  or  additional  appropriations  for  the 
barter  programs  contemplated  by  the  Congress. 

Longer  range  programs. — The  task  of  reaching  a  balance  in  our 
international  accounts  is  not  one  that  the  Government  can  achieve 
alone.     The  private  sector  of  the  economy  has  an  even  more  vital 


32    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

role  to  play.  Longrun  equilibrium  will  be  reached  and  maintained 
onlj'  if  private  industr}^  improves  its  efficiency  more  rapidly,  produces 
goods  and  services  fully  competitive  in  world  markets,  and  actively 
seeks  out  and  fully  exploits  its  export  opportunities. 

Here,  the  Government  can  act  as  a  prod  and  catalyst  and  help 
assure  the  proper  environment.  We  have  recognized  that,  if  business 
moves  ahead  satisfactorily,  a  balanced  budget  in  fiscal  1963  is  a  desir- 
able part  of  this  environment.  Under  conditions  of  strong  private 
demand,  a  balanced  budget  would  assure  that  the  overall  fiscal  pro- 
gram of  the  Government  is  in  keeping  with  the  need  to  avoid  excesses 
in  our  domestic  economy  and  to  release  savings  and  resources  for 
productive  investment.  Moreover,  our  monetary  policies  are  being 
conducted  in  a  manner  to  assure  that  ample  credit  is  available  to 
finance  domestic  growth  without  providing  new  fuel  for  inflation. 
But,  in  the  last  analysis,  the  critical  decisions  and  the  crucial  actions 
are  those  of  private  citizens. 

Above  all  else  is  the  need  for  business  and  labor  to  exert  conscious 
restraint  in  shaping  wage  and  price  policies.  Our  industry  cannot 
remain  competitive  if  we  repeat  the  pattern  of  the  1950's,  when  prices 
of  industrial  goods  in  this  country  advanced  more  rapidly  than  those 
of  our  leading  competitors.  Prices  of  American  manufactured  goods 
exports,  for  instance,  rose  14  percent  relative  to  those  of  other  in- 
dustrialized nations  from  1953  to  1960.  Over  the  same  period,  our 
share  of  world  exports  of  manufactures  declined  from  25.9  percent 
to  21.6  percent. 

All  the  agencies  of  the  Government  directly  concerned — ^the  Council 
of  Economic  Advisers,  the  Departments  of  Labor  and  Connnerce, 
and  the  Treasmy — are  cooperating  to  demonstrate  to  all  Americans 
the  key  fact  that  the  United  States  can,  in  this  intensely  competitive 
world,  win  the  battle  for  markets  only  by  doing  a  better  job  m  re- 
straining our  own  prices  and  costs.  The  President's  Labor  and 
Management  Advisory  Committee,  too,  is  fully  aware  of  the  impor- 
tance of  price  stability  to  our  international  payments  situation,  as 
well  as  to  our  domestic  economic  welfare. 

The  Council  of  Economic  Advisers  has  set  forth  guideposts  for  wage 
and  price  decisions  consistent  with  our  long-range  needs.  These 
guideposts  would  permit  increases  in  average  wages  over  time  in 
line  with  increases  in  national  productivity.  They  would  allow  for 
the  correction  of  inequities  in  the  wage  structure,  and  would  permit 
market  forces  to  be  appropriately  reflected  in  relative  wages  and  prices. 
They  do  not  provide  precise  answers  to  everj^  question  that  arises 
amid  the  tug  and  pull  of  collective  bargaining  and  pricing  decisions. 
But  they  can  indicate,  amid  the  strong  pressures  on  both  labor  and 


INTERNATIONAL   FINANCE  33 

management  to  seek  whatever  bargaining  advantage  the  moment 
offers,  where  the  pubhc  interest  hes. 

Fortunately,  we  have  so  far  come  out  of  the  recent  recession  with- 
out price  increases.  Wholesale  prices  of  industrial  commodities  are 
actually  a  bit  lower  than  in  the  spring  of  1961  despite  a  gain  in  pro- 
duction of  over  12  percent — altogether  the  best  performance  of  the 
postwar  years.  At  the  same  time,  prices  in  most  foreign  countries 
have  tended  to  rise.  But,  as  the  domestic  economy  moves  ahead, 
and  the  benefits  of  extraordinary  gains  in  productivity  typical  of  the 
early  stages  of  recovery  are  absorbed,  we  cannot  relax  our  vigilance. 

Upon  taking  office,  the  President  suggested  that  it  was  the  re- 
sponsibility of  every  citizen  to  ask  what  he  could  do  for  his  country. 
In  this  area  of  price  and  wage  decision,  that  challenge  is  clear  and 
specific. 

More  rapid  modernization  of  our  industrial  plants,  so  that  the 
United  States  can  retain  its  leadership  in  eflBcient  production,  is 
another  essential  part  of  our  longer  run  effort  to  achieve  and  maintain 
a  stronger  position  in  export  markets.  Improved  efficiency  is  the 
only  way  that  we  can  hope  to  achieve  faster  growth  at  home  and  a 
better  life  for  all  of  our  citizens,  while  still  meeting  our  commitments 
abroad  and  remaining  competitive  in  world  markets. 

This  improved  efficiency  is  in  good  part  dependent  on  incorporating 
modern  science  and  technology  in  our  production  methods.  Congress 
now  has  before  it  a  biU  that  would  provide  a  tax  credit  to  be  applied 
against  purchases  of  new  industrial  equipment.  Within  the  frame- 
work of  existing  laws,  the  Treasury  also  has  underway  a  program  of 
depreciation  reform,  updating  the  outmoded  guidelines  set  years  ago 
and  permitting  faster  writeoffs  in  line  with  current  experience  and 
technology.  Together,  these  key  reforms  will  provide  incentives  for 
new  investment  in  the  United  States  comparable  to  those  available 
for  investment  in  productive  facilities  in  other  industrialized  countries 
of  the  free  world. 

At  the  same  time,  our  payments  situation  underscores  the  im- 
portance of  removing  from  our  tax  laws  those  provisions  that  give  an 
unwarranted  stimulus  to  investment  by  American  firms  in  the  de- 
veloped countries  abroad.  American  foreign  business  does  not  require 
the  use  of  special  tax  privileges,  and  particularly  access  to  tax  havens 
that  avoid  practically  all  taxes,  to  operate  effectively  in  developed 
countries  with  business  tax  systems  comparable  to  ours. 

Price  stability  and  improved  efficiency  provide  the  essential  under- 
pinning for  any  effort  to  expand  our  commercial  trade  siu'plus  by 
penetrating  export  markets  aggressively  while  at  the  same  time  meet- 
ing import  competition  without  resort  to  restrictions.     In  addition, 


34    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Government  officials  and  businessmen  must  become  much  more  ex- 
port-minded than  ever  before.  To  assm^e  maximum  exploitation  of 
all  opportunities,  efforts  within  the  Government  to  facilitate  and  en- 
courage the  flow  of  American  goods  and  services  to  foreign  markets 
have  been  greatly  increased. 

The  foreign  trade  functions  of  the  Foreign  Service  and  the 
Department  of  Commerce  have  been  reshaped  and  infused  with 
fresh  energy  so  that  American  business  can  be  made  aware  of  export 
opportunities  as  they  arise.  Foreign  market  surveys  by  our  Foreign 
Service  numbered  over  34,000  in  1961,  an  increase  of  73  percent  over 
1960.  The  Commerce  Department  has  established  a  National  Export 
Expansion  Council,  linked  to  14  regional  councils  throughout  the 
United  States,  on  which  1,000  business  executives  are  being  asked  to 
serve. 

Efforts  to  familiarize  foreign  businessmen  with  American  products 
and  firms  also  are  being  intensified.  The  U.S.  Trade  Center  Program, 
initiated  successfully  in  London  in  1961,  is  being  expanded.  Centers 
in  Bangkok,  Frankfurt,  and  Tokyo  will  open  in  1962.  In  1961  we 
participated  in  11  international  trade  fau's  and  sent  special  trade 
missions  to  12  countries. 

The  Department  of  Agriculture,  utilizing  foreign  currencies 
received  from  sales  of  surpluses  abroad,  has  expanded  its  program 
to  develop  foreign  markets  for  American  wheat,  feed  grains,  rice,  and 
other  agricultural  products.  Forty  private  trade  groups  are  associated 
with  the  Department  in  this  effort.  In  1961  alone,  agricultural  trade 
promotion  exhibits  were  provided  at  20  international  fairs  in  Europe, 
Africa,  the  Far  East,  and  Latin  America. 

The  Export-Import  Bank,  in  cooperation  with  60  insurance  com- 
panies, has  developed  a  broad  program  of  export  credit  insurance  to 
be  carried  out  through  the  newly  created  Foreign  Credit  Insurance 
Association.  The  FCIA,  which  began  operations  early  in  February 
1962,  is  offering  to  exporters  throughout  the  United  States  a  single 
insurance  policy,  backed  by  extensive  Government  guarantees,  cover- 
ing both  commercial  and  political  risks  connected  with  U.S.  export 
sales  to  bu3'ers  in  friendly  foreign  countries.  When  fully  effective,  this 
new  insurance  program,  together  with  existing  Government  and  pri- 
vate facilities,  should  permit  the  American  exporter  to  offer  export 
credit  on  a  footing  at  least  as  favorable  as  available  to  his  foreign 
competitors. 

To  promote  foreign  travel  to  the  United  States,  and  thereby 
reduce  our  deficit  to  about  $1  billion  a  year  on  foreign  travel  account, 
the  Department  of  Conunerce  has  established  a  new  agency,  the  U.S. 
Travel  Service,  assisted  by  a  36-man  Travel  Advisory  Committee 
drawn  from  our  private  travel  and  tourist  industr3^     United  States 


INTERNATIONAL   FINANCE  35 

travel  promotion  personnel  are  now  established  in  seven  foreign  cities 
and  are  working  with  travel  agents,  carriers,  and  the  general  public 
in  30  foreign  countries. 

Procedures  for  entry  into  the  United  States  for  foreign  business 
and  vacation  travelers  have  been  simplified.  Most  visas  for  such 
visitors  are  now  issued  in  less  than  30  minutes.  The  Department  of 
State  last  year  recommended  legislation  designed  to  simplify  visa 
requirements  for  travelers  still  further  and  eliminate  them  entirel}^ 
on  the  basis  of  reciprocity.  Congress  failed  to  act  on  this  proposal 
in  1961,  but  it  will  be  resubmitted  at  the  1962  session. 

To  assure  that  the  maximum  potential  from  this  wide  variety  of 
efforts  is  reached  the  Secretaries  of  the  Treasury  and  of  Commerce 
recommended  that  the  President  appoint  an| export  coordinator  in 
the  Department  of  Commerce  to  concentrate  wholly  on  the  overriding 
need  to  expand  our  export  sales. 

The  export  coordinator  would  be  responsible  for  developing,  in 
consultation  with  private  business,  meaningful  export  targets  by 
industry,  and  by  country  and  region  of  destination.  He  would  assure 
that  the  vast  facilities  of  Government  are  used  to  best  advantage  in 
helping  our  exporters  to  reach  these  targets.  He  would  keep  a  close 
watch  on  performance,  pursuing  through  his  own  small  staff  and 
existing  channels  the  reasons  for  any  shortfalls  and  assisting  in  the 
removal  of  obstacles  as  they  develop.  Finally,  he  should  identify 
new  problems  that  might  arise,  and  make  recommendations  to  the 
proper  officials  for  dealing  with  them. 

The  role  oj  other  countries. — The  deficit  in  our  own  balance  of  pay- 
ments has  its  counterpart  m  the  surpluses  of  other  countries.  These 
surpluses,  in  recent  years,  have  been  largely  concentrated  in  several 
of  the  industrialized  countries  in  continental  Western  Europe.  These 
countries  have  as  great  a  responsibility  for  cutting  down  their  surpluses 
as  we  have  for  reducing  our  deficit,  if  the  international  monetary 
system  is  to  be  both  strong  and  stable. 

Substantial  advances  have  occurred  over  the  past  year  in  this 
sharing  of  responsibility.  There  were  the  military  arrangements  and 
sizable  debt  prepayments  by  certain  of  our  allies  already  mentioned. 
Further  agreements  along  these  lines  are  anticipated  during  1962. 
But  there  must  be  more.  We  are  hard  at  work  now  developing  the 
means. 

Only  a  beginning  has  been  made  in  mutual  support  for  the  expand- 
ing needs  of  the  developing  countries  for  economic  assistance,  on 
terms  and  conditions  suited  to  their  circumstances.  Conventional 
loans,  repayable  within  relatively  short  periods  at  high  rates  of 
interest,  do  not  adequately  meet  these  needs.  Other  industrialized 
countries,  in  the  years  ahead,  must  contribute  much  more  assistance 


36    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

to  the  developing  countries,  and  on  better  terms.  This  must  be 
a  continuing  objective  of  our  foreign  policy. 

In  most  industrialized  countries,  businesses  and  individuals  are 
still  not  free  to  invest  where  and  when  they  wish  outside  their  own 
currency  areas.  Frequently,  they  are  not  free  to  invest  in  the  United 
States  when  they  want  to,  and  in  ways  they  prefer.  Such  restrictions 
can  no  longer  be  generally  justified  on  balance-of-payments  grounds. 
Continued  use  of  them  is  especially  anomalous  in  the  case  of  the 
countries  with  large  and  growing  monetary  reserves. 

Surplus  countries  should  move  boldly  now  in  freeing  those  capital 
movements.  Moreover,  our  longtime  objective — removal  of  controls 
over  trade  itself — is  only  partially  fulfilled.  To  be  sure,  quotas  and 
other  quantitative  restrictions,  so  common  earlier  in  the  postwar 
period,  are  now  largely  gone  for  manufactured  goods  in  the  indus- 
trialized countries.  That  has  been  a  great  gain.  But  barriers 
remain  for  agricultm-al  goods.  And  the  progress  of  the  Common 
Market,  desirable  as  it  is,  will  brmg  into  being  a  common  external 
tariff,  a  barrier  which  must  be  lowered  if  the  United  States  is  to 
expand  its  sales  to  this  great  and  growing  market. 

A  breakthrough  is  imperative  in  this  area.  Broad-scale  trade 
negotiations  under  the  authority  of  the  Trade  Expansion  Act  that  the 
President  has  already  proposed  to  the  Congress  offer  the  only 
realistic  opportunity. 

Strengthening  the  world  monetary  system 

The  first  requisite  for  a  strong  and  healthy  international  monetary 
system  is  progress  toward  resolving  our  own  basic  balance-of-payments 
problem.  Only  in  that  way  can  there  be  a  firm  basis  for  continuing 
confidence  in  the  dollar.  But  even  then  the  system  will  remain 
exposed  to  potential  shocks  and  strains  arising  from  large-scale  shifts 
of  liquid  funds  from  one  country  to  another. 

Normally,  these  short-term  capital  flows  serve  a  constructive  pur- 
pose in  moving  funds  to  the  point  of  greatest  need.  But,  these  flows 
can  also  magnify  temporary  fluctuations  in  a  nation's  balance  of  pay- 
ments and  become  a  vehicle  for  speculation  against  one  currency  or 
another.  No  nation,  however  strong  in  reserves,  coidd  withstand 
alone  the  potential  pressures  that  could  conceivably  arise.  The  in- 
dustrialized nations  therefore  have  a  common  interest  in  protecting 
the  system  upon  which  we  all  rely  to  facilitate  the  flow  of  trade 
among  us. 

Basic  to  progress  in  meeting  this  problem  are  frank  consultations 
and  close  understanding  among  the  leading  financial  nations.  The 
working  groups  within  the  Organization  for  Economic  Cooperation 


INTERNATIONAL   FINANCE  37 

and  Development  and  the  regular  meetings  of  Em-opean  Central 
Bankers  at  Basle,  to  which  the  Federal  Reserve  now  regularly  sends 
an  observer,  have  provided  appropriate  forums  for  such  discussions, 
and  the  cooperative  spirit  displayed  has  been  gratifying.  As  a  result, 
we  can  now  shape  our  policies  with  better  understanding  of  the  needs 
and  responses  of  others.  The  uncertainties  and  lack  of  information 
that  can  be  a  breeding  gromid  for  speculation  and  instability  have 
been  largely  dissipated. 

It  was  this  understanding  and  cooperative  approach  toward  our 
mutual  problems  which  made  possible  the  agreement  announced  in 
December  by  ten  leading  industrialized  countries  to  supplement  the 
resources  of  the  International  Monetary  Fund  by  means  of  a  new 
system  of  lending  arrangements  totaling  $6  billion.  These  arrange- 
ments will  greatly  enhance  the  ability  of  the  Fund  to  cushion  any 
significant  shocks  to  the  monetary  system,  from  whatever  source, 
and  to  diffuse  the  impact  among  the  surplus  countries  best  able  to 
bear  it.  In  particular,  the  new  arrangements  would  greatly  increase 
the  potential  resources  of  the  Fund  in  currencies  of  the  surplus  coun- 
tries of  Western  Europe,  upon  which  the  United  States  would  have 
to  draw  in  the  event  of  need.  We  are  awaiting  final  approval  of  the 
enabling  legislation  by  the  Congress. 

The  Treasury  also  began,  during  the  past  year,  to  operate  directly 
in  the  foreign  exchange  markets.  Using  in  part  currencies  borrowed 
in  foreign  markets,  this  intervention  was  helpful  in  damping  down 
the  kinds  of  temporary  fluctuations  in  the  exchanges  that  can  set  off 
excessive  short-term  capital  movements.  The  Federal  Reserve,  acting 
under  its  existing  statutory  authority,  began  in  March  1962  to  engage 
in  foreign  exchange  operations  in  full  consultation  and  cooperation 
with  the  Treasury.  This  participation  by  the  Federal  Reserve  will 
strengthen  this  country's  resources  and  facilities  for  countering  any 
threatening  pressures  against  the  dollar  in  world  exchange  markets. 
It  will,  in  the  end,  contribute  to  the  further  use  of  the  dollar  as  a 
reserve  and  trading  currency. 

There  is  one  area  in  which  the  United  States  can  take  action  to 
eliminate  an  incentive  for  short-term  capital  flows  that  serve  no  real 
economic  purpose.  Certain  recently  imposed  taxes  abroad,  in  com- 
bination with  the  current  provisions  of  our  tax  laws  permitting  a 
credit  for  foreign  taxes  paid,  have  created,  for  some  companies,  an 
entirely  artificial  incentive  to  transfer  liquid  balances  abroad.  A 
specific  recommendation  for  dealing  with  this  quirk  in  the  application 
of  our  tax  laws  has  been  prepared  by  the  Treasury  so  that  appropriate 
remedy  may  be  included  in  the  tax  bill  this  year. 


38    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Prospects  for  1962 

Changes  in  any  nation's  balance  of  payments  from  year  to  year, 
reflecting  a  mass  of  crossciuTents  in  both  the  domestic  and  foreign 
economies,  are  never  fully  predictable.  Nevertheless,  it  is  clear 
that  tlie  measures  already  taken  and  proposed  will  not  have  had  time 
to  work  theu-  full  effect  in  1962.  We  must  therefore  be  prepared  for 
another  deficit  in  the  balance  this  year. 

The  principal  factor  working  against  a  balance  in  1962  is  the 
prospect  of  a  sharp  increase  in  imports  over  the  unusually  low  level 
during  the  early  part  of  1961.  This  can  be  expected  in  response  to 
the  growth  of  our  domestic  economy.  The  same  sort  of  uicrease 
cannot  safely  be  assumed  for  exports,  tied  closely  to  market  con- 
ditions abroad,  although  we  will  be  doing  all  we  can  to  expand  our 
foreign  markets.  Our  commitments  for  defense  and  economic  as- 
sistance should,  however,  impose  a  smaller  burden,  because  of  foreign 
debt  payments,  offsetting  payments  for  military  purchases,  and  the 
tying  of  aid  to  the  fullest  extent  possible  to  purchases  from  the  United 
States. 

We  must  be  prepared  also  for  a  possible  further  outflow  of  short- 
term  capital.  Borrowings  in  the  American  market  by  residents  of 
other  countries  and  foreign  governments,  unusually  large  over  the 
past  two  3'ears,  are  likely  to  slacken,  but  not  to  cease.  In  the  con- 
duct of  our  monetary  and  debt  management  policies,  we  must  re- 
main continually  alert  to  assure  that  our  oa\ti  short-term  market 
does  not  become  so  liquid  that  credit  spills  over  unnecessarih^  into 
foreign  lending. 

The  means  for  financing  our  prospective  deficit  in  1962  are  available. 
In  the  process,  some  portion  will  need  to  be  settled  in  gold  as  some 
countries  exchange  part  of  their  dollar  holdings  for  gold  to  restore  or 
maintain  their  varied  rule-of-thumb  ratios  of  gold  to  their  total  inter- 
national reserves,  although  ratios  of  that  sort  have  less  relevance  as 
international  cooperation  becomes  closer  and  the  payments  system  is 
strengthened. 

These  gold  losses  in  1962  should  not  be  of  a  size  or  character  to  cause 
dismay.  But  they  will  be  a  forceful  reminder  that,  until  our  accounts 
are  fully  in  order,  we  are  using  our  reserves  to  buy  time. 

We  still  have  the  time  for  the  most  important  element  in  any  real 
cure  consistent  with  the  maintenance  of  our  commitments  to  free 
world  security  and  economic  progress  in  the  developing  countries^ — ^an 
expanded  conmiercial  surplus.  To  achieve  that  expanded  com- 
mercial surplus  we  shall  have  to  apply  ourselves  to  the  job  at  hand 
with  the  same  urgency  it  would  need  if  little  or  no  time  were  left. 
And  we  shall  also  have  to  insist  that  other  free  countries  able  to  do  so 
assume  and  discharge  their  full  share  of  the  common  burden,  and 


INTERNATIONAL   FINANCE  39 

provide  us  with  the  sort  of  trading  opportunities  that  will  permit  us 
to  carry  our  own  full  share. 

Essential  parts  of  this  overall  program  still  require  legislative  action 
for  their  full  implementation : 

Authority  to  participate  in  the  supplementary  International 
Monetary  Fund  arrangements. 

Authority  to  bargain  effectively  for  lower  tariffs  with  the  Euro- 
pean Common  Market  and  other  countries  under  the  terms  of  the 
Trade  Expansion  Act. 

Incentives  for  more  rapid  modernization  of  industrial  equipment 
by  means  of  an  investment  tax  credit. 

The  removal  of  special  inducements  to  invest  abroad  by  elimi- 
nating the  possibilities  for  tax  avoidance  on  foreign  operations  through 
the  use  of  tax  havens  and  unwarranted  deferments  of  taxes  on  oper- 
ations of  foreign  subsidiaries. 

New  appropriations  adequate  to  staff  and  operate  effectively  the 
office  of  the  recommended  export  coordinator  and  the  enlarged 
functions  of  the  Departments  of  State  and  Commerce  in  stimulating 
exports. 

Simplified  visa  requirements  for  foreign  visitors. 

Continuation  of  Public  Law  480  in  a  form  that  will  not  adversely 
affect  our  balance  of  payments. 

Recognition  of  the  problems  before  us,  the  wisdom  to  devise  and 
forcefully  apply  appropriate  remedies,  the  understanding  cooperation 
of  our  allies  abroad — all  of  these  are  critical  elements  in  a  successful 
resolution  of  our  current  difficulties.  But  in  the  end  we  will  succeed, 
as  in  all  our  endeavors,  only  as  all  Americans  grasp  the  challenge, 
and  demonstrate  that  combination  of  restraint  in  setting  wages  and 
prices  and  bold  initiative  in  seizing  export  opportunities  that  the 
circumstances  require.  The  stability  of  the  dollar  is  a  key  to  eco- 
nomic progress  at  home  and  abroad.  Beyond  that,  it  will  stand  as  a 
symbol  of  our  own  determination  to  discharge  the  responsibility  that 
is  ours  for  leadership  of  the  free  world. 

II.  FOREIGN  ASSISTANCE 

Economic  development  of  the  less-developed  areas  of  the  free  world 
is  a  prmiary  objective  of  U.S.  policy.  In  this  area  the  Treasury  is 
concerned  particularly  with  the  relationship  of  development  assistance 
to  our  balance-of-payments  situation,  as  described  above;  with  en- 
couraging the  flow  of  funds  from  other  industrialized  countries;  with 
the  terms  and  conditions  of  lending  by  U.S.  agencies  and  their  effect 
upon  the  economies  of  the  recipients;  and  with  the  impact  of  the 
monetary,  fiscal,  and  exchange  policies  of  the  recipient  economies 
upon  the  effective  use  of  public  assistance  and  private  capital. 


40    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  Secretary  of  the  Treasury,  as  chairman  of  the  statutory  coor- 
dinating group,  the  National  Advisory  Council  on  International 
Monetary  and  Financial  Problems,  is  charged  with  the  task  of  coor- 
dinating foreign  lending  and  stabilization  policies  and  operations  with 
overall  governmental  policies. 

Since  the  rise  of  strong  economies  in  other  industrialized  countries 
of  the  free  world,  we  have  endeavored  to  obtain  from  them  a  larger 
and  more  effective  flow  of  financial  assistance  on  both  public  and 
private  account  to  the  developing  countries. 

Through  the  International  Bank  and  its  affiliated  mstitutions, 
through  the  newly  formed  Development  Assistance  Committee  of  the 
O.E.C.D.,  through  consortia  dealing  with  particular  countries,  and 
through  less  formal  channels,  this  objective  has  been  pursued. 

In  carrying  out  the  coordinating  activities  of  the  National  Advisory 
Council,  the  Treasmy  has  sought  financial  terms  and  conditions  of 
lending  which  are  suited  to  the  changing  objectives  of  U.S.  policy, 
and  which  take  into  account  the  appropriate  interrelationship  of  the 
activities  of  the  international  agencies,  the  Export-Import  Bank,  the 
Agency  for  International  Development,  other  Government  agencies, 
and  private  institutions. 

Through  a  variety  of  contacts,  consultations,  and  negotiations  with 
less-developed  countries  the  Treasury  has  encouraged  financial 
policies  which  will  strengthen  their  economies,  develop  and  enlarge 
domestic  sources  of  capital,  avoid  inflationary  dissipation  of  resources, 
and,  in  general,  promote  effective  use  of  the  assistance  they  receive. 
In  this  area,  the  advice  and  assistance  of  the  International  Monetary 
Fund  has  been  particularly  helpful,  and  in  certain  Latin  American 
countries  the  Treasury  has  entered  into  stabilization  agreements  to 
promote  these  objectives. 

With  passage  of  the  Foreign  Assistance  Act  in  1961,  the  Congress 
established  a  new  institutional  framework  and  new  policies  for  U.S. 
foreign  assistance.  Military  assistance  continued  its  decline  relative 
to  economic  assistance.  Our  aid  program  places  new  emphasis  on 
economic  and  social  development,  on  evidence  of  the  determination  of 
less-developed  countries  to  achieve  development  and  to  take  measures 
to  help  themselves  do  so,  on  the  preparation  of  coherent  long-term 
plans,  and  on  the  assurance  that  development  assistance  will  be 
available  on  a  continuing  basis. 

A  major  aspect  of  U.S.  foreign  policy  during  1961  was  the  estab- 
lishment of  the  Alliance  for  Progress,  imder  which  the  United  States 
committed  itself  to  concentrate  continuing  efforts  on  a  broad  scale  to 
assist  in  the  development  of  Latin  America.  In  the  Charter  of 
Punta  del  Este — which  created  the  Alliance — the  participating  Latin 
American  countries  agreed  to  prepare  long-term  programs  for  economic 


INTERNATIONAL   FINANCE  41 

and  social  reform  and  development,  with  special  emphasis  upon  the 
need  for  self-help  measures  such  as  land  and  tax  reform.  On  its 
part,  the  United  States  pledged  itself  to  help  achieve  these  goals,  and 
agreed  to  provide  a  major  part  of  the  estimated  minimum  of  $20 
billion  required  by  Latin  America  over  the  next  ten  years  from  all 
external  sources  in  order  to  supplement  its  own  efforts. 

Part  of  the  financial  assistance  to  be  provided  by  the  United  States 
within  the  Alliance  is  administered  by  the  Inter-American  Develop- 
ment Bank,  which  unites  the  Latin  American  members  and  the 
United  States  in  a  cooperative  drive  for  more  rapid  growth  within  the 
Hemisphere.  During  1961,  the  first  year  of  operations,  the  Inter- 
American  Development  Bank  authorized  loans  totaling  about  $294 
million.  Of  this  sum,  $116  million  was  committed  from  the  Social 
Progress  Fund,  which  administers  Alliance  for  Progress  funds 
appropriated  by  the  United  States. 

The  United  States  has  also  continued  to  provide  resources  and 
leadership  for  development  programs  elsewhere  in  the  free  world. 
The  United  States  is  participating  actively  in  consortia  of  industrial 
nations  meeting  regularly,  under  the  auspices  of  the  International 
Bank  for  Reconstruction  and  Development,  to  coordinate  assistance 
to  India  and  Pakistan. 


ADMINISTRATION 

A  number  of  steps  to  improve  administrative  operations  in  the 
Treasury  were  undertaken  in  calendar  year  1961.  Basic  organiza- 
tional changes  were  put  into  effect,  staff  assistance  for  policj^making 
officials  was  strengthened,  and  improvements  were  made  in  work 
methods  and  procedures. 

Organizational  improvements 

Responsibility  for  all  areas  of  tax  policy,  and  supervision  of  all 
personnel  engaged  in  tax  policy  formulation  were  centralized  under 
an  Assistant  Secretary",  and  his  staff  was  greatly  strengthened. 

An  Office  of  Congressional  Relations  was  established  to  improve 
Treasury  Department  liaison  with  the  Congress. 

An  additional  position  of  Assistant  to  the  Secretary  was  created 
to  provide  for  closer  liaison  with  other  departments  and  agencies 
concerning  activities  affecting  the  Treasury. 

A  post  of  Deputy  Under  Secretary  for  Monetary  Affairs  was 
established  to  assist  in  the  formulation  and  execution  of  domestic 
and  international  financial  policy. 

The  Office  of  Defense  Lending  was  assigned  to  the  Fiscal  Assistant 
Secretary. 

The  Office  of  Security  was  assigned  to  the  Administrative  Assistant 
Secretary. 

A  new  position  of  Deputy  Administrative  Assistant  Secretary  was 
established  to  handle  the  growing  administrative  worldoad. 

An  Office  of  Financial  Analysis  was  created  to  advise  the  Secretary 
on  a  broad  range  of  financial  and  economic  problems,  and  thereby  to 
assist  him  in  his  role  as  chief  financial  adviser  to  the  President. 

A  group  of  50  of  the  Nation's  most  noted  economists  wore  named 
to  serve  as  consultants  to  the  Treasury  in  their  particular  fields  of 
competence. 

An  Office  of  Domestic  Gold  and  Silver  Operations  was  estal)lished 
within  the  Office  of  the  Under  Secretary  for  Monetary  Aft'airs,  and 
was  made  responsible  for  the  formulation  of  policy  in  this  area. 

An  Executive  Secretariat  was  established  to  assiune  the  responsil)ility 

for    coorcHiuiting   information    and    action    documents    between    the 

Offices  of  the  Secretary  and  Under  Secretary  and  the  Department's 

various  divisions  and  bureaus.     The  Secretariat  also  follows  action 

42 


ADMINISTRATION  43 

assignments  made  by  the  Secretary  and  Under  Secretary  and  informs 
the  various  offices  in  the  Department  of  pohcy  decisions  of  concern 
to  them. 

The  Office  of  Management  and  Organization,  in  the  Office  of  the 
Administrative  Assistant  Secretary,  was  reorganized  into  tliree 
divisions  in  order  to  fix  responsibihty  for  speciahzed  areas  of  activity. 
The  Management  Analysis  Division  was  assigned  the  responsibihty 
for  management  improvement  programs,  long-range  planning  efforts, 
and  appraisal  of  the  internal  audit  systems  of  the  various  bureaus 
and  divisions.  The  Mobilization  Planning  Staff  was  made  responsible 
for  coordinating  the  Department's  emergency  preparedness  activities. 
The  Systems  Development  Division  was  assigned  supervision  of  all 
systems  design  and  analysis,  including  manual  systems  and  automatic 
data  processing  activity,  and  review  of  the  accounting  systems  in 
use  in  the  Department.  The  functions  of  appraisal  of  accountmg 
and  audit,  formerly  in  the  Bureau  of  Accounts,  were  combined  into 
the  Office  of  Management  and  Organization. 

In  the  Internal  Revenue  Service,  administrative  activities  were 
regrouped  and  placed  under  the  newly  created  Office  of  the  Assistant 
Commissioner  for  Administration,  which  also  has  jurisdiction  over 
the  Public  Information,  Facilities  Management,  Personnel,  Fiscal 
Management,  and  Training  divisions. 

Mechanization  of  operations 

Of  the  many  steps  undertaken  during  the  year  to  improve  the 
Department's  efficiency,  among  the  most  significant  was  the  expanded 
use  of  automatic  data  processing  equipment.  For  instance,  the 
Internal  Revenue  Service  National  Computer  Center,  at  Martins- 
burg,  W.  Va.,  which  ultimately  will  process  tax  return  data  from  the 
entire  Nation,  went  into  operation  late  in  the  year. 

In  addition,  further  progress  was  made  toward  ultimate  mechani- 
zation of  the  Treasury's  entire  disbursing  process,  from  initial  check- 
writing  to  final  reconciliation  of  check  payments.  The  processing  of 
savings  bonds  has  also  been  converted  to  a  more  efficient  and 
economical  electronic  system. 

The  Coast  Guard  continued  its  conversion  from  man-operated  to 
automatic  lighthouses. 

Manpower  utilization 

Progress  has  been  made  in  improving  the  Department's  utilization 
of  personnel,  by  simplification  of  work  procedures,  by  added  emphasis 
on  training  programs,  and  by  increased  utilization  of  qualified  minority 
group  members. 

614359—62 4 


44    ANNUAL  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  Bureau  of  Customs,  with  improved  procedures,  was  able  for 
the  first  time  in  more  than  five  years  to  reduce  its  backlog  of  cases 
involving  final  duty  assessments  on  commercial  imports. 

Cooperation  between  various  Treasury  bureaus  and  State  and  local 
governments  was  continued  and  expanded  in  various  areas  of  activity. 

Many  types  of  violations  and  inspections  formerly  handled  by  the 
Bureau  of  Narcotics  are  now  being  referred  to  local  or  State  authorities 
for  investigation  and  prosecution,  or  are  investigated  jointly. 

Internal  Revenue  Service  changes  in  its  system  of  inspection  of 
distilled  spirits  plants  by  Alcohol  and  Tax  Unit  personnel  resulted  in 
significant  savings  in  manpower  and  money. 

The  Internal  Revenue  Service  has  negotiated  formal  agreements 
for  the  exchange  of  tax  information  with  the  States  of  Utah  and 
California.  Earlier  agreements  with  the  four  States  originally  par- 
ticipating in  the  program  have  been  revised  to  provide  for  a  broadened 
policy  on  the  cooperative  exchange  of  tax  information.  An  agree- 
ment was  made  with  the  State  of  Ohio  for  the  exchange  of  excise, 
gift,  and  estate  tax  information. 

Future  trends 

Several  specific  programs  of  management  improvements  are  under- 
way. 

The  financial  and  tax  analysis  staffs  will  be  further  strengthened. 

Increased  use  of  automatic  data  processing  equipment  by  the 
Treasury  is  anticipated  in  the  year  ahead.  An  ADP  system  for 
classifying  and  coding  handwriting  is  under  development  which  will 
enable  the  Secret  Service  to  speed  identification  of  forgers. 

In  the  Bureau  of  Customs,  studies  and  projects  aimed  at  facili- 
tating international  trade  and  travel  have  been  undertaken.  The 
recommendations  of  a  Citizens'  Task  Force,  appointed  to  study  the 
handling  of  travelers'  baggage  by  Customs,  are  being  considered. 

A  study  of  the  role  and  missions  of  the  Coast  Guard  is  also  being 
made. 

In  addition,  a  study  of  the  Department's  long-range  planning 
activities  will  begin  shortly.  This  study  will  include  determination 
of  the  extent  and  scope  of  such  activities,  evaluation  of  their  effective- 
ness, and  identification  of  areas  for  improvement. 


ORGANIZATION    CHART   AND 
TREASURY    OFFICIALS 


o 


SECRETARY,  UNDER  SECRETARIES,  GENERAL  COUNSEL,  AND  AS- 
SISTANT SECRETARIES  OF  THE  TREASURY  DEPARTMENT  FROM 
JANUARY  21,   1961,  TO  JANUARY  8,  1962 1 


Term  of  service 

Official 

From 

To 

Secretary  of  the  Treasury 

Jan. 

21,  1961 

Douglas  Dillon,  New  Jersey. 

Under  Secretary 

Feb 

3,  1961 

Henry  H.  Fowler,  Virginia. 

Under  Secretary  of  the  Treasury  for 
Monetary  Affairs 

Jan. 

31,  1961 

Robert  V.  Roosa,  New  York. 

General  Counsel 

Apr. 

5,  1961 

Robert  H.  Knight,  Virginia. 

Assistant  Secretaries 

Dec. 
Apr. 

20,  1957 

5,  1961 

24,  1961 

20,  1961 

Dec.   19,  1961 

A.  Gilmore  Flues,  Ohio. 
John  M.  Leddy,  Virginia. 

Apr. 
Dec. 

Stanley  S.  Surrey,  Massachusetts. 
James  A.  Reed,  Massachusetts. 

Fiscal  Assistant  Secretary 

June 

19,  1955 

William  T.  Heffelfinger,  District  of  Columbia. 

Administrative  Assistant  Secretary 

Sept. 

14,  1959 

A.  E.  Weatherbee,  Maine. 

1  For  officials  from  September  11,  1789,  through  January  20, 1961,  see  exhibit  32  in  this  report. 


47 


PRINCIPAL  ADMINISTRATIVE  AND  STAFF  OFFICERS  OF  THE  TREASURY 
DEPARTMENT  AS  OF  JANUARY  8,  1962 

SECRETARY 
DOUGLAS  DILLON 

Henry  H.  Fowler Under  Secretary  of  the  Treasury. 

Douglass  Hunt Special  Assistant  to  the  Under  Secretary. 

Robert  V.  Roosa Under  Secretary  for  Monetary  Affairs. 

J.  Dewey  Daane Deputy     Under     Secretary     for     Monetary 

Affairs. 

Leland  Howard Director,  Office  of  Domestic  Gold  and  Silver 

Operations. 

Paul  A.  Volcker Director,  Office  of  Financial  Analysis. 

Frank  E.  Morris Assistant  to  the  Secretary  (Debt   Manage- 
ment) . 

R.  Duane  Saunders Director,  Office  of  Debt  Analysis. 

Robert  H.  Knight General  Counsel. 

John  K.  Carlock Assistant  General  Counsel. 

Edwin  F.  Rains Assistant  General  Counsel. 

Fred  B.  Smith Assistant  General  Counsel. 

Hugo  A.  Ranta Assistant  to  the  General  Counsel. 

George  F.  Reeves Chief  Counsel  to  the  Fiscal  Assistant  Sec- 
retary. 

Harold  R.  PoUak Chief  Counsel,  Foreign  Assets  Control. 

John  M.  Leddy Assistant  Secretary. 

John  C.  Bullitt Deputy  Assistant  Secretary. 

George  H.  Willis Director,  Office  of  International  Finance. 

Charles  R.  Harley Assistant    Director,    Office   of   International 

Finance. 

Margaret  W.  Schwartz Associate  Director,  Foreign  Assets  Control. 

Stanley  S.  Surrey Assistant  Secretary. 

Donald  C.  Lubick Director,  Office  of  Tax  Legislation. 

Michael  Waris,  Jr Associate  Director,  Office  of  Tax  Legislation. 

Harvej'  E.  Brazer Director,  Office  of  Tax  Analysis. 

Douglas  H.  Eldridge Associate  Director,  Office  of  Tax  Analysis. 

Nathan  N.  Gordon Director,  Office  of  International  Tax  Affairs. 

James  A.  Reed Assistant  Secretary. 

James  P.  Hendrick Deputy  to  the  Assistant  Secretary. 

Commander  Robert  D.  John- 
son, U.S.C.G Aide  to  the  Assistant  Secretary. 

Arnold  Sagalyn Director,   Office  of  Law  Enforcement  Coor- 
dination. 

William  T.  Heffelfinger Fiscal  Assistant  Secretary. 

Martin  L.  Moore Assistant  to  the  Fiscal  Assistant  Secretary. 

George  F.  Stickney Technical  Assistant  (Systems  and  Methods 

Staff). 

Boyd  A.  Evans Technical  Assistant. 

Frank  F.  Dietrich Technical  Assistant. 

Hampton  A.  Rabon,  Jr Technical  Assistant. 

Robert  M.  Seabury Director,  Office  of  Defense  Lending. 

A.  E.  Weatherbce Administrative  Assistant  Secretary. 

Carl  W.  Clewlow Deputy  Administrative  Assistant  Secretary 

and  Director,  Office  of  Management  and 
Organization. 

Willard  L.  Johnson Director,  Office  of  Budget. 

Amos  N.  Latham,  Jr Director,  Office  of  Personnel. 

Paul  McDonald Director,  Office  of  Administrative  Services. 

Albert  J.  Faulstich Director,  Office  of  Security. 

48 


PRINCIPAL    ADMINISTRATIVE    AND    STAFF    OFFICERS  49 

Joseph  W.  Barr Assistant   to   the    Secretary    (Congressional 

Relations) . 

-  _  Richard  E.  McCormack Deputy  Assistant  to  the  Secretary  (Congress- 
ional Relations). 

Dixon  Donnelley Assistant  to  the  Secretary  (Public  Affairs). 

Stephen  C.  Manning,  Jr Deputy  Assistant  to  the  Secretary  (Public 

Affairs) . 
Eileen  Shanahan Special  Assistant  to  Assistant  to  the  Secre- 
tary (Public  Affairs). 

Robert  A.  Wallace Assistant  to  the  Secretary. 

Charles  A.  Sullivan Special  Assistant  to  the  Secretary. 

Theodore  L.  Eliot,  Jr Special  Assistant  to  the  Secretary. 

Frank  A.  Southard,  Jr Special  Assistant  to  the  Secretary. 

Robert  Cutler Special  Assistant  to  the  Secretary. 

Seymour  E.  Harris Senior  Consultant  to  the  Secretary. 

William  N.  Turpin Director,  Executive  Secretariat. 

BUREAU  OF  ACCOUNTS 

Harold  R.  Gearhart Commissioner  of  Accounts. 

Sidney  S.  Sokol Assistant  Commissioner. 

George  Friedman Staff  Assistant  to  the  Commissioner. 

Julian  F.  Cannon Chief  Disbursing  Officer. 

Harold  A.  Ball Chief  Auditor. 

Ray  T.  Bath Deputy  Commissioner — Accounting  Sys- 
tems. 

Sidney  Cox Deputy  Commissioner — Deposits  and  In- 
vestments. 

John  H.  Henriksen Assistant  Commissioner  for  Administration. 

Howard  A.  Turner Deputy  Commissioner — Central  Accounts. 

Samuel  J.  Elson Deputy  Commissioner — Central  Reports. 

BUREAU  OF  CUSTOMS 

Philip  Nichols,  Jr Commissioner  of  Customs. 

David  B.  Strubinger Assistant  Commissioner  of  Customs. 

Alfred  F.  Beiter Deputy  Commissioner  for  Policy  Planning. 

N.  G.  Strub Deputy  Commissioner  of  Management  and 

Controls. 

C.  A.  Emerick Deputy  Commissioner,  Division  of  Investi- 
gations and  Enforcement. 

Walter  G.  Roy Deputy  Commissioner,  Division  of  Appraise- 
ment Administration. 

William  E.  Higman Deputy  Commissioner,  Division  of  Classifi- 
cation and  Drawbacks. 

Robert  Chambers Chief  Counsel. 

James  W.  Gulick Deputy  Commissioner,  Division  of  Marine 

Administration. 

Burke  H.  Flinn Deputy   Commissioner,    Division  of  Entry, 

Value,  and  Penalties. 

George  Vlases,  Jr Deputy  Commissioner,  Division  of  Techni- 
cal Services. 

BUREAU  OF  ENGRAVING  AND  PRINTING 

Henry  J.  Holtzclaw Director,  Bureau  of  Engraving  and  Printing. 

Frank  G.  Uhler Assistant  Director. 

BUREAU  OF  THE  MINT 

Eva  Adams Director  of  the  Mint. 

Leland  Howard Assistant  Director. 

BUREAU  OF  NARCOTICS 

Harry  J.  Anslinger Commissioner  of  Narcotics. 

Henry  L.  Giordano Deputy  Commissioner. 

Charles  Siragusa Assistant  Deputy  Commissioner. 


50  PRINCIPAL    ADMINISTRATIVE    AND    STAFF    OFFICERS 

BUREAU  OF  THE  PUBLIC  DEBT 

Donald  M.  Merritt Commissioner  of  the  Public  Debt. 

Ross  A.  Heffelfinger,  Jr Assistant  Commissioner. 

Michael  E.  McGeoghegan Deputy  Commissioner. 

Charles  D.  Peyton Deputy  Commissioner  in   Charge,   Chicago 

Office. 

INTERNAL  REVENUE  SERVICE 

Mortimer  M.  Caplin Commi.=!sioner  of  Internal  Revenue. 

Bertrand  M.  Harding Deputy  Commissioner. 

Vernon  D.  Acree Assistant  Commissioner  (Insp?ction). 

William  H.  Loeb Assistant  Commissioner  (Compliance). 

Harold  T.  Swartz Assistant  Commissioner  (Technical). 

William  H.  Smith Assistant  Commissioner  (Planning  and  Re- 
search). 

Robert  L.  Jack Assistant  Commissioner  (Data  Processing). 

Edward  F.  Preston Assistant  Commissioner  (Administration). 

Crane  C.  Hauser Chief  Counsel. 

Thomas  J.  Reilly Director  of  Practice. 

OFFICE  OF  THE  COMPTROLLER  OF  THE  CURRENCY 

James  J.  Saxon Comptroller  of  the  Currency. 

H.  S.  Haggard First  Deputy  Comptroller  of  the  Currency. 

W.  M.  Taylor Deputy  Comptroller  of  the  Currency. 

G.  W.  Garwood Deputy  Comptroller  of  the  Currency. 

C.  C.  Fleming Deputy  Comptroller  of  the  Currency. 

Justin  T.  Watson Chief  National  Bank  Examiner. 

OFFICE  OF  THE  TREASURER  OF  THE  UNITED  STATES 

Elizabeth  Rudel  Smith Treasurer  of  the  United  States. 

WiUiam  T.  Howell Deputy  Treasurer. 

Willard  E.  Scott Assistant  Deputy  Treasurer. 

UNITED  STATES  COAST  GUARD 

Admiral  Alfred  C.  Richmond Commandant,  U.S.  Coast  Guard. 

Vice  Admiral  James  A.  Hirshfield__  Assistant  Commandant  and  Chief  of  Staff. 

Rear  Admiral  James  A.  Alger Engineer  in  Chief. 

Rear  Admiral  Irvin  J.  Stephens...   Chief,  Office  of  Merchant  Marine  Safety. 

UNITED  STATES  SAVINGS  BONDS  DIVISION 

William  H.  Neal National  Director. 

Bill  McDonald Assistant  National  Director. 

UNITED  STATES  SECRET  SERVICE 

James  J.  Rowley Chief,  U.S.  Secret  Service. 

Paul  J.  Paterni Deputy  Chief. 

E.  A.  Wildy Assistant  Chief. 

COMMITTEES  AND  BOARDS 

Elizabeth  Rudel  Smith Chairman,  Interdepartmental  Savings  Bond 

Committee. 

A.  E.  Weatherbee Chairman,  Treasury  Management  Com- 
mittee. 

Amos  N.  Latham,  Jr Chairman,  Treasury  Awards  Committee. 

Amos  N.  Latham,  Jr Chairman,  Treasury  Wage  Board. 

Robert  A.  Wallace Employment  Policy  Officer. 

Robert  A.  Wallace Principal  Compliance  Officer. 


REVIEW   OF   OPERATIONS 

AND   STATISTICS 

FOR   THE   FISCAL   YEAR  1961 


CONTENTS 


REVIEW  OF  FISCAL  OPERATIONS 

Page 

Budget  results 63 

Budget  receipts  and  expenditures 64 

Budget  receipts  in  1961 64 

Estimates  of  receipts  in  1962  and  1963 67 

Budget  expenditures  in  1961 70 

Estimates  of  expenditures  in  1962  and  1963 72 

Trust  account  and  othier  transactions 73 

Corporations  and  certain  other  business-type  activities  of  the   Govern- 
ment   75 

Account  of  the  Treasurer  of  the  United  States 79 

Public  debt  operations  and  ownership  of  Federal  securities 80 

Public  debt  operations 89 

Ownership  of  Federal  securities 97 

Taxation  developments 102 

International  financial  and  monetary  developments 114 

ADMINISTRATIVE  REPORTS 

Management  improvement  program 139 

Comptroller  of  the  Currency,  Bureau  of  the 141 

Customs,  Bureau  of- . 144 

Defense  Lending,  Office  of 158 

Engraving  and  Printing,  Bureau  of 159 

Fiscal  Service 163 

Internal  Revenue  Service 193 

International  Finance,  Office  of 204 

Mint,  Bureau  of  the 205 

Narcotics,  Bureau  of 209 

United  States  Coast  Guard 213 

United  States  Savings  Bonds  Division 223 

United  States  Secret  Service 225 

EXHIBITS 

PUBLIC  DEBT  OPERATIONS,   CALLS  OF  GUARANTEED  OBUGATIONS. 
REGULATIONS,  AND  LEGISLATION 

Treasury  Certificates  of  Indebtedness,  Treasury  Notes,  and  Treas- 
ury Bonds  Offered  and  Allotted 

1.  Treasury  certificates  of  indebtedness 233 

2.  Treasury  notes 237 

3.  Treasury  bonds 243 

Treasury  Bills  Offered  and  Accepted 

4.  Treasury  bUls 258 

Guaranteed  Obligations  Called 

5.  Calls    for    partial    redemption,    before    maturity,    of    insurance    fund 

debentures 270 

53 


54  CONTENTS 

U.S.  Savings  Bonds  Regulations 

Page 

6.  First  amendment,  March  21,  1961,  to  Department  Circular  No.  653, 

Fifth  Revision,  regulations  governing  Series  E  savings  bonds 274 

7.  Fourth  amendment,  May  16,  1961,  to  Department  Circular  No.  750, 

Revised,  regulations  governing  payments  by  banks  and  other  finan- 
cial institutions  in  connection  with  the  redemption  of  U.S.  savings 
bonds 293 

U.S.  Savings  Stamps  Regulations 

8.  First  revision,    August   5,    1960,   of   Department   Circular   No.    1008, 

regulations  governing  Treasury  savings  stamp  agents  in  the  sale  of 

U.S.  savings  stamps  at  schools 293 

Legislation 

9.  An  act  to  increase  for  a  one-year  period  the  public  debt  liinit  set  forth 

in  section  21  of  the  Second  Liberty  Bond  Act. 297 

10.  An  act  to  authorize  adjustments  of  outstanding  old  series  currency, 

and  for  other  purposes 297 

PUBLIC  DEBT  MANAGEMENT 

11.  Statement  by  Secretary  of  the  Treasury  Dillon,  June  27,  1961,  before 

the  Senate  Finance  Committee  on  a  new  temporary  public  debt 

limit 299 

TAXATION  DEVELOPMENTS 

12.  Message  from  the  President,  April  20,  1961,  relative  to  the  Federal  tax 

system 303 

13.  Statement  by  Secretary  of  the  Treasury  Dillon,  May  3,  1961,  before 

the  House  Committee  on  Ways  and  Means  on  the  President's  tax 
program 313 

14.  Statement  by  Secretary  of  the  Treasury  Dillon,  March  14,  1961,  before 

the  House  Committee  on  Ways  and  Means  on  financing  the  Federal 
highway  program 341 

15.  Statement  by  Assistant  Secretary  of  the  Treasury  Surrey,  July  25, 

1961,  before  the  Senate  Finance  Committee  on  H.R.  10,  to  encourage 
the  establishment  of  voluntary  pension  plans  by  self-employed 
individuals 344 

INTERNATIONAL  FINANCIAL  AND  MONETARY   DEVELOPMENTS 

16.  Statement  by  the  President,  October  27,  1961,  on  the  new  programs  to 

stimulate  American  exports,  strengthen  the  U.S.  balance  of 
payments,  and  enlist  the  maximum  cooperation  of  private  credit 
facilities 348 

17.  Statement  by  Secretary  of  the  Treasury  Dillon,  February  14,  1961, 

before  the  Senate  Foreign  Relations  Committee  on  ratification  of 
the  Organization  for  Economic  Cooperation  and  Development 
Convention 349 

18.  Statement  by  Secretary  of  the  Treasury  Dillon,  March  7,  1961,  before 

the  Joint  Economic  Committee 351 

19.  Remarks  by  Secretary  of  the  Treasury  Dillon,  April  11,  1961,  at  the 

second  meeting  of  the  Board  of  Governors  of  the  Inter-American 
Development  Bank,  Rio  de  Janeiro,  Brazil 357 

20.  Statement  by  Secretary  of  the  Treasury  Dillon,  April  28,  1961,  before 

the  Senate  Appropriations  Committee  on  the  Act  of  Bogota  and 

the  proposed  Fund  for  Social  Progress 360 

21.  Remarks  by  Secretary  of  the  Treasury  Dillon,  May  2,  1961,  before 

the  U.S.  Council  of  the  International  Chamber  of  Commerce,  New 
York,  N.Y 364 

22.  Statement  by  Secretary  of  the  Treasury  Dillon,  May  10,  1961,  before 

a  Subcommittee  of  the  House  Committee  on  Banking  and  Currency 
on  a  proposed  amendment  to  the  Articles  of  Agreement  of  the 
International  Finance  Corporation 367 


CONTENTS  55 

Page 

23  Joint  announcement,    May   17,   1961,  by  Secretary  of  the  Treasury 

Dillon  and  the  Minister  of  Finance  of  Brazil  on  the  conclusion  ot 
financial  negotiations  between  the  United  States  and  Brazil 368 

24  Statement  by  Secretary  of  the  Treasury  Dillon,  June  5,  1961,  before 

the  Senate  Foreign  Relations  Committee  on  the  proposed  Act  for 
International    Development    and    the     International    Peace    and 

Security  Act V^-,";--- V-'-in"  VnVr-uT" 

25  Statement  by  Secretary  of  the  Treasury  Dillon,  June  19,  1961,  before 

the  Subcommittee  on  International  Exchange  and  Payments  of  the  ^ 

Joint  Economic  Committee .--"ir- 

26  Statement  by  Secretary  of  the  Treasury  Dillon  as  Governor  for  the 

United  States,  September  20,  1961,  at  the  discussion  of  the  Annual 
Report  of  the  International  Monetary  Fund 380 

27  Statement  by  Assistant  Secretary  of  the  Treasury  Leddy  as  Temporary 

Alternate 'Governor  for  the  United  States,  September  21,  1961,  at 
the  discussion  of  the  Annual  Report  of  the  International  Finance 
Corporation -" ; a" r  Vr" 

28  Statement  by  Assistant  Secretary  of  the  Treasury  Upton,  August  15, 

1960,  before  the  Senate  Foreign  Relations  Committee  on  the  Presi- 
dent's proposal  for  Latin  America ___._-----       385 

29  Press  release,  August  9,  1960,  announcing  the  signing  of  the  Articles 

of  Agreement  of  the  International  Development  Association 38/ 

30.  Press  release,  January  6,  1961,  on  extending  the  exchange  agreement 

between  the  United  States  and  Argentina 388 

31.  Press  release,  February  10,  1961,  on  the  signing  of  an  exchange  agree- 

ment between  the  United  States  and  Chile 388 

ORGANIZATION  AND  PROCEDURE 

32  Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the  Treas- 
ury Department  from  September  11,  1789,  to  January  20,  1961,  and 
the  Presidents  under  whom  they  served _ 389 

33.  Treasury  Department  orders  relating  to  organization  and  procedure.  _        393 

TABLES 

Bases  of  tables  _   403 

Description  of  accounts  relating  to  cash  operations 406 

SUMMARY  OF  FISCAL  OPERATIONS 

1.  Summary  of  fiscal  operations,  fiscal  years  1932-61  and  monthly  1961  _  -       408 

RECEIPTS  AND  EXPENDITURES 

2.  Receipts  and  expenditures,  fiscal  years  1789-1961 410 

3.  Transfers  to  trust  funds  and  refunds  of  receipts,  fiscal  years  1931-61.  .       416 
4    Budget  receipts  and  expenditures,  monthly  for  fiscal  year  1961  and 

totals  for  1960  and  1961 . 418 

5.  Interfund  transactions  excluded  from  both  net  budget  receipts  and 

budget  expenditures,  fiscal  years  1932-61 450 

6  Public    enterprise    revolving    funds,    receipts    and    expenditures    for 

fiscal  year  1961,  and  net  1960  and  1961 458 

7  Trust  account  and  other  receipts  and  expenditures,  monthly  for  fiscal 

year  1961  and  totals  for  1960  and  1961 460 

8.  Investments  of  Government  agencies  in  public  debt  securities  (net), 

monthly  for  fiscal  year  1961  and  totals  for  1960  and  1961 472 

9    Sales   and   redemptions   of   obligations   of   Government   agencies   in 

market   (net),  monthly  for  fiscal  year   1961   and  totals  for   1960 

and  1961 -ri^^ 1       ^"'^ 

10.  Intertrust  fund  transactions  excluded  from  both  net  trust  account 

receipts  and  net  trust  account  expenditures,  fiscal  years  1948-61..       476 

11  Trust  enterprise  revolving  funds,  receipts  and  expenditures  for  fiscal 

year  1961  and  net  for  fiscal  year  1960 477 

12  Budget  receipts  by  sources  and  expenditures  by  major  functions, 

fiscal  years  1953-61 -.ir--r----z--'       ^^^ 

13  Trust  account  and  other  transactions  by  major  classifications,  fiscal 

years  1952-61 482 


56  CONTENTS 

Page 
14.  Budget  receipts  and  expenditures,  based  on  existing  and  proposed 
legislation,  actual  for  the  fiscal  year  1961  and  estimated  for  1962 

and  1963 484 

15  Trust  account  and  other  transactions,  actual  for  the  fiscal  year  1961 

and  estimated  for  1962  and  1963 487 

16  Effect  of  financial  operations  on  the  public  debt,  actual  for  the  fiscal 

year  1961  and  estimated  for  1962  and  1963 489 

17.  Internal  revenue  collections  by  tax  sources,  fiscal  years  1929-61 490 

18.  Internal  revenue  collections  and  refunds  by  States,  fiscal  year  1961__  496 

19.  Customs  collections  and  refunds,  fiscal  years  1960  and  1961 497 

20.  Deposits  by  the  Federal  Reserve  Banks  representing  interest  charges 

on  Federal  Reserve  notes,  fiscal  years  1947-61 498 

21.  Postal  receipts  and  expenditures,  fiscal  years  1916-61 499 

22.  Cash  income  and  outgo,  fiscal  years  1952-61 500 

PUBLIC  DEBT,  GUARANTEED  OBUGATIONS,  ETC. 

I. — Outstanding 

23.  Principal  of  the  pubHc  debt,  1790-1961 507 

24.  Public  debt  and  guaranteed  obligations  outstanding  June  30,  1934-61_        509 

25.  Public  debt  outstanding  by  security  classes,  June  30,  1952-61 510 

26.  Guaranteed  obligations  issued  by  Government  corporations  and  other 

business-type  activities  and  held  outside  the  Treasury,  June  30, 
1952-61 513 

27.  Interest-bearing  securities    outstanding  issued    by  Federal  agencies 

but  not  guaranteed  by  the  United  States  Government,  fiscal  years 
1953-61 514 

28.  Maturity  distribution  of  marketable  interest-bearing  public  debt  and 

guaranteed  obligations,  June  30,  1946-61 515 

29    Summary   of  public   debt   and   guaranteed   obligations   by  security 

classes,  June  30,  1961 516 

30.  Description  of  pubUc  debt  issues  outstanding  June  30,  1961 518 

31  Description   of  guaranteed   obUgations   held   outside  the   Treasury, 

June  30,  1961 537 

32  Postal  savings  svstems'  deposits  and  Federal  Reserve  notes  outstand- 

ing, June  30,  1946-61 539 

33  Statutory  hmitation  on  the  public  debt  and  guaranteed  obligations, 

June  30,  1961 541 

34  Debt  limitation  under  the  Second  Liberty  Bond  Act,  as  amended, 

1917-61 542 

II. — Operations 

35.  Public  debt  receipts  and  expenditures  by  security  classes,  monthly 

for  fiscal  year  1961  and  totals  for  1960  and  1961 544 

36.  Changes  in  public  debt  issues,  fiscal  year  1961 554 

37.  Issues,  maturities,  and  redemptions  of  interest-bearing  public  debt 

securities,  excluding  special  issues,  July  1960-June  1961 574 

38.  Allotments  by  investor  classes  on  subscriptions  for  public  marketable 

securities  other  than  regular  weekly  Treasury  bills,  fiscal  year  1961  _        604 

39.  Public  debt  increases  and  decreases,  and  balances  in  the  account  of 

the  Treasurer  of  the  U.S.,  fiscal  years  1916-61 605 

40.  Statutory  debt  retirements,  fiscal  years  1918-61 606 

41.  Cumulative  sinking  fund,  fiscal  years  1921-61 607 

42  Transactions  on  account  of  the  cumulative  sinking  fund,  fiscal  year 

1961 608 

III, — United  States  savings  bonds 

43  Summary  of  sales  and  redemptions  of  savings  bonds  by  series,  fiscal 

years  1935-61  and  monthly  1961 609 

44.  Sales  and  redemptions  of  Series  E  through  K  savings  bonds  by  series, 

fiscal  vears  1941-61  and  monthly  1961 610 

45.  Sales  and  redemptions  of  Series  E  and  H  savings  bonds  by  denomina- 

tions, fiscal  years  1941-61  and  monthly  1961 614 

46.  Sales  of  Series  E  and  H  savings  bonds  by  States,  fiscal  years  1960, 

]^  1961,  and  cumulative 615 


CONTENTS  57 

IV. — Interest 

Page 

47.  Amount  of  interest-bearing  public  debt  outstanding,  the  computed 

annual  interest  charge,  and  the  computed  rate  of  interest,  June  30, 
1916-61,  and  at  the  end  of  each  month  during  1961 616 

48.  Computed  annual  interest  rate  and  computed  annual  interest  charge 

on  the  public  debt  by  security  classes,  June  30,  1939-61 618 

49.  Interest  on  the  public  debt  by  security  classes,  fiscal  years  1957-61_-       620 

50.  Interest  on  the  public  debt  and  guaranteed  obligations  by  tax  status, 

fiscal  years  1940-6 1 621 

V. — Prices  and  yields  of  securities 

51.  Average   yields   of  taxable  long-term   Treasury   bonds   by   months, 

October  1941-June  1961 1 622 

52.  Prices  and  yields  of  marketable  public  debt  issues,  June  30,  1960  and 

1961,  and  price  range  since  first  traded 623 

VI. — Ownership  of  governmental  securities 

53.  Estimated  ownership  of  interest-bearing  governmental  securities  out- 

standing June  30,  1952-61,  by  type  of  issuer 625 

54.  Estimated   distribution   of  interest-bearing  governmental   securities 

outstanding  June  30,  1952-61,  by  tax  status  and  type  of  issuer 626 

55.  Summary  of  Treasury  survey  of  ownership  of  interest-bearing  public 

debt  and  guaranteed  obligations,  June  30,  1960  and  1961 628 

ACCOUNT  OF  THE  TREASURER  OF  THE  UNITED  STATES 

56.  Assets  and  liabilities  in  the  account  of  the  Treasurer  of  the  United 

States,  June  30,  1960  and  1961 630 

57.  Analysis  of  changes  in  tax  and  loan  account  balances,  fiscal  years 

1952-61 : 631 

STOCK  AND  CIRCULATION  OF  MONEY  IN  THE  UNITED  STATES 

58.  Stock  of  money,  money  in  the  Treasury,  in  the  Federal  Reserve  Banks, 

and  in  circulation,  by  kinds,  June  30,  1961 632 

59.  Stock  of  money,  money  in  the  Treasury,  in  the  Federal  Reserve  Banks, 

and  in  circulation,  June  30,  1913-61 634 

60.  Stock  of  money  by  kinds,  June  30,  1913-61 635 

61.  Money  in  circulation  by  kinds,  June  30,  1913-61 636 

62.  Location  of  gold,  silver  bullion  at  monetary  value,  and  coin  held  by 

the  Treasury  on  June  30,  1961 1 1        637 

63.  Paper  currency  issued  and  redeemed  during  the  fiscal  year  1961  and 

outstanding  June  30,  1961,  by  classes  and  denominations 637 

TRUST  FUNDS  AND  CERTAIN  OTHER  ACCOUNTS  OF  THE  FEDERAL 
GOVERNMENT 

64.  Holdings  of  Federal  securities  by  Government  agencies  and  accounts, 

June  30,  1952-61 638 

I. — Trust  funds 

65.  Ainsworth  Library  fund,  Walter  Reed  General  Hospital,  June  30, 

1961 642 

66.  Civil  service  retirement  and  disability  fund,  June  30,  1961 642 

67.  District  of  Columbia  teachers'  retirement  and  annuity  fund,  June  30, 

1961 645 

68.  District  of  Columbia  other  funds — Investments  as  of  June  30,  1960 

and  1961 646 

69.  Employees  health  benefits  fund,  June  30,  1961 647 

70.  Employees'  life  insurance  fund,  Civil  Service  Commission,  June  30, 

1961 648 

71.  Federal  disability  insurance  trust  fund,  June  30,  1961 650 

72.  Federal  old-age  and  survivors  insurance  trust  fund,  June  30,  1961 652 

73.  Foreign  service  retirement  and  disability  fund,  June  30,  1961 654 

74.  Highway  trust  fund,  June  30,  1961 655 

75.  Judicial  survivors  annuity  fund,  June  30,  1961 656 


58  CONTENTS 

Page 

76.  Library  of  Congress  trust  funds,  June  30,  1961 657 

77.  Longshoremen's  and  Harbor  Workers'  Compensation  Act,  relief  and 

rehabilitation,  June  30,  1961 658 

78.  National  Archives  gift  fund,  June  30,  1961 658 

79.  National  park  trust  fund,  June  30,  1961 659 

80.  National  service  life  insurance  fund,  June  30,  1961 659 

81.  Pershing  Hall  Memorial  fund,  June  .30,  1961 660 

82.  Philippine  Government  pre-1934  bond  account,  June  30,  1961 661 

83.  Pubhc  Health  Service  gift  funds,  June  30,  1961 662 

84.  Railroad  retirement  account,  June  30,  1961 662 

85.  Unemployment  trust  fund,  June  30,  1961 664 

86.  U.S.  Government  life  insurance  fund,  June  30,  1961 670 

87!  U.S.  Naval  Academy  general  gift  fund,  June  30,  1961 671 

88.  Workmen's  Compensation  Act  within  the  District  of  Columbia,  re- 

lief and  rehabilitation,  June  30,  1961 672 

II. — Certain  other  accounts 

89.  Colorado  River  Dam  fund,  Boulder  Canyon  project,  status  by  oper- 

ating years  ending  May  31,  1933  through  1961 673 

90.  Refugee  Relief  Act  of  1953,  loan  program  through  June  30,  1961 674 

FEDERAL  AID  TO  STATES 

91    Expenditures  for  Federal  aid  to  States,  individuals,  etc.,  fiscal  years 

1930,  1940,  1950,  and  1961 675 

92.  Expenditures  made  by  the  Gov(  rnment  as  direct  payments  to  States 

under  cooperative  arrangements  and  expenditures  within  States 
which  provided  relief  and  other  aid,  fiscal  year  1961 683 

CUSTOMS  STATISTICS 

93.  Summary  of  customs  collections  and  expenditures,  fiscal  year  1961..  699 

94!  Customs  collections  and  payments  by  districts,  fiscal  year  1961 700 

95!  Merchandise  entries,  fiscal  years  1960  and  1961 701 

96  Principal  commodities  on  which  drawback  was  paid,  fiscal  years  1960 

and  1961 .----        '^^^ 

97.  Computed  customs  duties,  value  of  dutiable  imports,  and  ratio  of 

computed  duties  to  value  of  dutiable  imports,  by  tariff  schedules, 
calendar  vears  1949-59 702 

98.  Computed  customs  duties,  value  of  imports  entered  for  consumption, 

and  ratio  of  duties  to  value  of  dutiable  imports  and  to  value  of  all 
imports,  calendar  years  1949-59 704 

99.  Value  of  dutiable  and  taxable  imports  for  consumption  and  com- 

puted duties  and  taxes  collected  by  tariff  schedules,  fiscal  years 

1959  and  1960 -        705 

100.  Value  of  dutiable  imports  for  consumption  and  computed  duties  col- 
lected bv  countries,  fiscal  years  1959  and  1960 706 

101  Vehicles  and  persons  entering  the  United  States,  fiscal  years  1960 

and  1961 -        708 

102  Aircraft  and  aircraft  passengers  entering  the   United  States,  fiscal 

years  1900  and  1961 708 

103.  Seizures  for  violations  of  customs  laws,  fiscal  years  1960  and  1961  __        709 

104.  Investigative  activities,  fiscal  years  1960  and  1961 710 

ENGRAVING  AND  PRINTING  PRODUCTION 

105  New  postage  stamp  issues  delivered,  fiscal  year  1961 710 

106  Deliveries  of  finished  work  by  the  Bureau  of  Engraving  and  Printing, 

fiscal  years  1960  and  1961 711 

INTERNATIONAL  CLAIMS 

107  Awards  of  the  Mixed  Claims  Commission,  Unitod  States  and  Ger- 

many, certified  to  the  Secretary  of  the  Treasury  by  the  Secretary 

of  State,  through  June  30,  1961 712 

108.  Mexican  claims  fund  as  of  June  30,  1961 714 

109.  Yugoslav  claims  fund  as  of  June  30,  1961 714 


CONTENTS  59 

Page 

110.  Status  of  claims  of  American  nationals  against  certain  foreign  gov- 

ernments as  of  June  30,  1961 715 

GOLD  AND  CURRENCY  TRANSACTIONS  AND  HOLDINGS 

111.  United  States  net  monetary  gold  transactions  with  foreign  countries 

and  international  institutions,  fiscal  years  1945-61 716 

112.  Estimated  gold  reserves  and  dollar  holdings  of  foreign  countries  as  of 

June  30,  1960,  December  31,  1960,  and  June  30,  1961 718 

113.  United  States  gold  stock  and  holdings  of  convertible  foreign  curren- 

cies by  U.S.  monetary  authorities,  fiscal  years  1952-61 720 

114.  Assets  and  liabilities  of  the  exchange  stabilization  fund  as  of  June  30, 

1960  and  1961 721 

115.  Summary  of  receipts,  withdrawals,  and  balances  of  foreign  curren- 

cies acquired  by  the  United  States  without  purchase  with  dollars, 

fiscal  year  1961 724 

116.  Balances  of  foreign  currencies  acquired  by  the  United    States  with- 

out purchase  with  dollars,  June  30,  1961 726 

INDEBTEDNESS  OF  FOREIGN  GOVERNMENTS 

117.  Indebtedness  of  foreign  governments  to  the  United  States  arising  from 

World  War  I,  and  payments  thereon  as  of  June  30,  1961 728 

118.  World  War  I  indebtedness,  payments  and  balances  due  under  agree- 

ments between  the  United  States  and  Germany  as  of  June  30,  1961  __       729 

119.  Outstanding  indebtedness  of  foreign  countries  on  United  States  Gov- 

ernment credits  (exclusive  of  indebtedness  arising  from  World  War 

I)  as  of  June  30,  1961,  by  area,  country,  and  major  program 730 

120.  Status  of  accounts  under  lend-lease  and  surplus  property  agreements 

(World  War  II)  as  of  June  30, 1961 732 

CORPORATIONS  AND  CERTAIN    OTHER   BUSINESS-TYPE    ACTIVITIES    OF 
THE  UNITED   STATES   GOVERNMENT 

121.  Capital  stock,  notes,  and  bonds  of  Government  agencies  held  by  the 

Treasury  or  other  Government  agencies,  June  30,  1960  and  1961, 

and  changes  during  1961 1 736 

122.  Borrowing  authority  and  outstanding  issues  of  Government  corpor- 

ations and  certain  other  business-type  activities  whose  obligations 

are  issued  to  the  Secretary  of  the  Treasury,  June  30,  1961 738 

123.  Comparative  statement  of  obligations  of  Government  corporations 

and  certain  other  business-type  activities  held  by  the  Treasury, 
June30,  1952-61 739 

124.  Description  of  obligations  of  Government  corporations  and  certain 

other  business-type  activities  held  by  the  Treasury,  June  30,  1961 740 

125.  Comparative  statement  of  the  assets,  liabilities,  and  net  investment 

of  Government  corporations  and  certain  other  business-type  activ- 
ities, June  30,  1952-61 744 

126.  Statement  of  loans  outstanding  of    Government    corporations    and 

certain  other  business-type  activities,  June  30,  1961 746 

127.  Dividends,  interest,  and  similar  earnings  received  by  the  Treasury 

from    Government   corporations   and   certain   other   business-type 
activities,  fiscal  years  1960  and  1961 749 

128.  Restoration  of  amounts  of  capital  impairment  of  the  Commodity 

Credit  Corporation,  pursuant  to  the  act  of  March  8,  1938,  as  amend- 
ed        750 

GOVERNMENT  LOSSES  IN  SHIPMENT 

129.  Government  losses  in  shipment  revolving  fund,  June  30,  1961 751 

PERSONNEL 

130.  Number  of  employees  in  the  departmental  and  field  services  of  the 

Treasury  Department,  quarterly  from  June  30,  1960,  to  June  30, 

1961 752 

INDEX 753 

614359—62 5 


REVIEW   OF   FISCAL   OPERATIONS 


Budget  Results 


The  Government's  operations  resulted  in  a  budget  deficit  of  $3.9 
billion  in  the  fiscal  year  1961.  Receipts  amounted  to  $77.7  billion, 
slightly  less  than  those  in  1960  as  the  1960-1961  recession  reduced 
revenues  below  the  level  which  would  have  been  realized  from  an 
expanding  economy.  Expenditures  in  1961  were  $81.5  billion  as 
compared  with  $76.5  billion  in  1960.  The  increase  of  $5.0  billion 
resulted  from  greater  expenditures  for  national  security  and  space 
exploration  and  larger  outlays  generally  for  Government  programs, 
some  of  which  were  for  the  pm'pose  of  mitigating  the  economic 
recession. 

Chaet  2 

^THE  BUDGET 


$Bil 


Surplus 


I  81.5 

Expenditures s.     ^..^^       ';2     ^,..-|  ^ 


Deficit    . 

!  / 


1953       '54 


"61 


-Fiscal  Years- 


The  public  debt  rose  $2.6  billion  in  1961.  The  increase  in  debt  was 
less  than  the  budget  deficit  principally  because  of  a  reduction  of  $1.3 
billion  in  the  cash  balance  of  the  Treasurer  of  the  United  States. 
As  of  June  30,  1961,  the  total  public  debt  outstanding  amounted  to 
$289.0  billion. 

63 


64 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


The  Government's  fiscal  operations  in  1960-61  and  their  effect  on 
the  public  debt  are  summarized  as  follows: 


1960 

1961 

In  billions  of  dollars 

Budget  results: 

Net  receipts 

77.8 
76.5 

77.7 
81.5 

Net  expenditures .  _ 

Budget  deficit,  or  surplus  (— ) 

-1.2 

.  2 
2.7 

2.8 

.1 
-1.3 

3.9 

Plus: 

Trust  account  and  other  transactions,  excess  of  expenditures, 
or  receipts  (— )  ' 

Change  in  Treasurer's  balance: 

Increase,  or  decrease  (— ) .. 

Total — 

-1.2 

Equals:  Public  debt  increase .    . 

1.6 

2.6 

'  Includes  net  tmst  account  transactions,  etc.;  net  investments  by  Government  agencies  in  public  debt 
securities;  net  sales  or  redemptions  of  obligations  of  Government  agencies  in  the  market;  changes  in  clearing 
and  other  accounts  necessary  to  reconcile  to  Treasury  cash;  and  changes  in  the  amount  of  cash  held  outside 
the  Treasury. 


Budget  Receipts  and  Expenditures 
BUDGET  RECEIPTS  IN  1961 

Net  budget  receipts  in  the  fiscal  year  1961  amounted  to  $77.7 
l)illion,  practically  unchanged  from  the  alltime  high  record  of  $77.8 
billion  in  fiscal  1960. 

Receipts  in  fiscal  1961  would  have  attained  a  new  record  but  for  the 
new  treatment  of  taxes  collected  and  deposited  under  the  Federal 
Unemployment  Tax  Act.  Under  the  Emplojmient  Security'"  Act 
of  1960,  approved  September  13,  1960  (42  U.S.C.  1101),  beginning 
with  fiscal  1961  equivalent  amounts  of  those  receipts  are  appro- 
priated and  transferred  to  the  unemployment  trust  fund.  Previously 
these  taxes  were  classified  as  budget  receipts. 

Declines  in  receipts  from  the  corporation  income  tax  and  customs 
were  more  than  offset  by  increases  in  receipts  of  individual  income 
taxes  and  estate  and  gift  taxes. 

A  comparison  of  net  receipts  after  refunds  and  transfers  by  major 
sources  for  the  fiscal  years  1960  and  1961  is  shown  below.  Additional 
data  for  1961  on  a  gross  basis  are  presented  in  table  14. 


REVIEW    OF    FISCAL    OPERATIONS 


65 


1960 

1961 

Increase,  or 
decrease  (— ) 

Source 

Amount 

Percent 

In  millions  of  dollars 

Internal  revenue: 

Individual  income  taxes    

40, 715 

21,  494 

9,137 

339 

1,606 

-1 

41.  338 
20, 954 

9,063 
(*) 

1,896 

623 

-540 

-75 

-339 

290 

1 

1.5 

Corporation  income  taxes 

—2.5 

Excise  taxes 

—  .8 

Emplovment  taxes.  

(1) 

Estate  "and  gift  taxes  -    

18.0 

Internal  revenue  not  otherwise  classified 

(') 

Total  internal  revenue 

73,  290 
1,105 
4,062 

73,  251 

982 

4,080 

-40 

-122 

18 

—  .1 

Customs 

-11.1 

Miscellaneous  receipts 

.4 

Subtotal  receipts                 .    _ 

78, 457 
694 

78, 313 
654 

-144 
-40 

-.2 

Deduct: 

Interest  and  other  Income  received  by  Treasury 
from  Government  agencies  included  above  and 
also  included  in  budget  expenditures.  - 

-5.8 

Net  budget  receipts- 

77,  763 

77,  659 

-104 

—  .1 

*Negative  receipts  of  $461,000. 

'  Percentage  comparisons  Inappropriate. 

Individual  income  taxes. — As  a  result  of  the  higher  level  of  wages 
and  salaries,  individual  income  taxes  increased  $623  million,  or  1.5 
percent,  from  fiscal  1960  to  1961.  Withheld  taxes  on  salaries  and 
wages,  which  consist  approximately  of  two-thirds  of  individual  income 
tax  collections,  more  than  accounted  for  the  increase.  A  small  decline 
in  other  individual  income  taxes  was  the  result  of  decreased  payments 
on  declarations  and  final  returns  associated  with  the  1960-61  recession. 

Corporation  income  taxes. — The  decrease  of  2.5  percent  in  1961 
corporation  income  taxes  primarily  reflected  the  moderate  decline  in 
profits  which  occurred  in  the  calendar  year  1960,  the  liability  jeax 
primarily  determining  tax  receipts  in  the  fiscal  year  1961. 

Excise  taxes. — Receipts  from  this  source  are  shown  in  the  following 
table. 


1960 

1961 

Increase,  or 
decrease  (— ) 

Source 

Amomit 

Percent 

In  millions  of  dollars 

Alcohol  taxes 

3,194 
1,932 

139 

4,735 

379 

1,387 

100 

3,213 
1,991 

149 

4,897 

398 

1,498 

-81 

19 
60 

10 
162 

19 
111 

-181 

.6 

Tobacco  taxes 

3.1 

Taxes  on  documents,  other  instruments,  and  playing 
cards 

7.3 

Manufacturers'  excise  taxes 

3.4 

Retailers'  excise  taxes 

5.0 

Miscellaneous  excise  taxes . 

8.0 

Undistributed  depositary  receipts  and  unapplied  col- 
lections 

(') 

Gross  excise  taxes .. 

11, 865 

85 
2,642 

12,064 

78 
2,923 

200 

-7 
281 

1.7 

Deduct: 

■Refunds  nf  receipts 

-7.8 

Transfers  to  highway  trust  fund 

10.6 

Net  excise  taxes 

9,137 

9,063 

-75 

—.8 

1  Percentage  comparison  Inappropriate. 


66 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Excise  tax  receipts  generally  did  not  change  much  in  fiscal  1961 
from  receipts  in  1960.  Gross  excise  tax  receipts  rose  $200  million  in 
1961,  but  since  the  approximately  25  percent  of  excise  tax  revenues 
transferred  to  the  highway  trust  fund  rose  by  281  million,  receipts 
remaining  in  the  general  fund  declined  $81  million. 

Taxes  on  liquor,  tobacco,  passenger  automobiles,  and  communica- 
tions expenditures  provided  almost  80  percent  of  general  fund  reve- 
nues. Excise  revenues  included  in  budget  receipts  are,  therefore, 
dependent  to  a  substantial  extent  on  the  production  of  goods  and 
services  of  a  few  industries.  Consumer  expenditures  for  nondur- 
able goods  and  services  were  higher  in  fiscal  1961  than  in  1960,  and 
were  reflected  in  increases  in  revenues  from  taxes  on  alcohol,,  cig- 
arettes, and  communications.  However,  since  expenditures  for 
durable  goods,  especially  passenger  automobiles,  declined,  a  sub- 
stantial decrease  in  revenues  from  these  sources  was  reflected  in  a 
decline  in  excise  revenues  as  a  whole. 

The  increase  of  $281  million  in  highway  fund  taxes  in  1961  reflected 
the  full  year  effect  of  the  increase  in  the  tax  rate  on  motor  fuels  from 
3  cents  to  4  cents  a  gallon,  effective  October  1,  1959. 

Employment  taxes. — Receipts  from  the  various  employment  taxes 
were  as  follows: 


19C0 

1961 

Increase,  or 
decrease  (— ) 

Source 

Amount 

Percent 

Ini 

nDlions  of  do 

Uars 

Federal  Insurance  Contributions  Act  and  Self-Employ- 

10,  211 
607 
341 

11, 586 
571 
345 

1,376 
-36 

4 

13.5 

Rallroad  Retirement  Tax  Act - 

-6.0 

Federal  Unemployment  Tax  Act 

1.2 

Gross  employment  taxes -- 

11,159 
3 

9,272 
939 
607 

12,  502 

1 

10, 623 
963 
571 
345 

1,344 

-2 

1,352 

24 

-36 

345 

12.0 

Deduct: 

Refunds  of  receipts    -  -- 

-78.2 

Transfers  to- 
Federal  old-age  and  survivors  insurance  trust 
fund 

14.6 

Federal  disability  insurance  trust  fund 

2.6 

6.0 

Net  employment  taxes.                      -       --  - 

339 

(*) 

-339 

(') 

*  iXegativc  receipts  of  $461,000. 

'  Percentage  comparison  inappropriate. 


REVIEW    OF    FISCAL    OPERATIONS  67 

Net  employment  taxes  decreased  $339  million  in  fiscal  1961,  the 
result  of  transferring  for  the  first  time  the  receipts  from  the  Federal 
Unemployment  Tax  Act  to  the  unemployment  trust  fund.  The 
increase  of  $1,376  million,  or  13.5  percent,  in  receipts  from  the  Federal 
Insurance  Contributions  Act  and  Self-Employment  Contributions 
Act  reflected  the  rise  in  taxable  wages  and  the  full  year  effect  of  the 
rate  increase  effective  January  1,  1960.  Receipts  from  the  Railroad 
Retirement  Tax  Act  were  slightly  lower  than  in  1960. 

Estate  and  gift  taxes. — Receipts  from  estate  and  gift  taxes  amounted 
to  $1,896  million  in  fiscal  1961,  an  increase  of  $290  million,  or  18 
percent,  above  receipts  of  $1,606  million  in  1960.  The  increase 
reflected  substantial  gains  in  values  of  securities. 

Customs. — Customs  receipts  decreased  $122  million  in  1961  as  the 
result  of  a  decline  in  dutiable  imports  stemming  from  the  business 
recession. 

Miscellaneous  receipts. — Miscellaneous  receipts  amounted  to  $4,080 
million  in  1961,  relatively  unchanged  from  1960.  Declines  in  Federal 
Reserve  payments  to  the  Treasury  (which  had  been  unusually  large 
in  1960)  and  rental  receipts  were  more  than  offset  by  realizations 
on  loans,  principally  a  large  loan  prepayment  by  the  Federal  Republic 
of  Germany. 

ESTIMATES  OF  RECEIPTS  IN  FISCAL  1962  AND  1963 

The  Secretary  of  the  Treasury  is  required  each  year  to  prepare  and 
submit  in  his  annual  report  to  Congress  estimates  of  the  public  revenue 
for  the  current  fiscal  year  and  for  the  fiscal  year  next  ensuing  (act  of 
February  26,  1907  (5  U.S.C.  265)). 

The  estimates  of  receipts  from  taxes  and  customs  for  the  current  and 
ensuing  fiscal  years  are  prepared  by  the  Treasury  Department.  In 
general,  the  estimates  of  miscellaneous  receipts  are  prepared  by  the 
agencies  depositing  these  receipts  in  the  Treasury. 

Estimates  for  1963  assume  that  the  present  rates  on  corporate 
income  taxes,  and  excises  on  alcohol,  tobacco,  passenger  automobiles 
and  parts,  and  general  telephone  service  will  be  extended  until  June 
30,  1963,  as  recommended  by  the  President.  The  estimates  further 
assume  that  the  following  recommendations  of  the  President  with 
respect  to  transportation  taxes  will  be  enacted  to:  Repeal  the  tax  on 
transportation  of  persons,  except  for  airlines,  on  July  1,  1962  (under 
present  law  the  rate  would  drop  from  10  percent  to  5  percent);  extend 
the  present  10  percent  rate  on  airlines  until  December  31,  1962;  and 
enact  a  user  charge  of  5  percent  on  transportation  of  persons  and 


68     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

freight  by  air  effective  January  1,  1963;  tax  jet  fuel  at  two  cents  per 
gallon  for  airlines  and  three  cents  for  general  aviation;  raise  the 
present  two  cents  per  gallon  tax  on  aviation  gasoline  to  three  cents 
for  general  aviation  and  credit  all  receipts  to  the  general  fund  instead 
of  transferring  them  to  the  highway  trust  fund;  and  tax  fuel  used  on 
inland  waterways  at  two  cents  per  gallon. 

The  estimates  of  receipts  by  sources  do  not  show  the  revenue  effect 
of  the  President's  recommended  tax  reform  proposals  which  would 
allow  an  S  percent  credit  for  expenditures  for  equipment  and  eliminate 
certain  inequities  in  the  present  tax  structure  since  it  is  estimated 
that  the  reform  program  will  have  no  net  eflfect  on  revenues. 

Estimates  of  revenues  for  the  fiscal  years  1962  and  1963  are  based  on 
the  expectation  that  the  broad  economic  recovery  which  began  early 
in  the  calendar  year  1961  will  continue  tliroughout  the  period  under- 
lying receipts  in  the  two  fiscal  3'ears.  Although  the  rapid  rate  of 
recovery  which  was  experienced  in  the  last  nine  months  of  1961  is  not 
expected  to  continue,  the  recovery  movement  will  remain  strong,  and 
it  is  estimated  that  the  gross  national  product  in  the  calendar  year 
1962  will  amount  to  $570  billion,  an  increase  of  almost  $50  billion  over 
the  calendar  year  1961.  Consistent  with  this  increase  in  the  value  of 
goods  and  services  will  be  an  advance  in  incomes.  Personal  in- 
come is  expected  to  rise  from  $417  billion  in  the  calendar  year  1961  to 
$448  billion  in  1962. 

Corporate  profits  in  the  first  quarter  of  the  calendar  year  1961,  the 
low  point  of  the  1960-61  recession,  had  dropped  to  a  level  almost  $9 
billion,  seasonally  adjusted  annual  rate,  below  the  same  quarter  of 
the  preceding  year.  Profits  have  risen  sharply  since  the  fu'st  quarter, 
but  because  of  the  depressed  recession  level  at  the  beginning  of  the 
year  the  corporate  profits  total  for  the  whole  of  the  calendar  year  1961 
will  not  be  much  higher  than  the  total  for  1960.  A  continued  rise  in 
1962  is  expected  to  bring  corporate  profits  for  that  year  to  $56.5 
billion,  a  rise  of  approximately  $10.5  billion  above  the  1961  level. 

As  a  result  of  the  anticipated  widespread  economic  recover}^,  all 
major  tax  sources  show  increases  in  estimated  revenues  for  both  of  the 
fiscal  years  1962  and  1963.  Gains  in  both  years  are  substantial 
except  for  the  corporation  income  tax  where  a  moderate  rise  is  esti- 
mated for  1962  followed  b}^  a  ver}^  large  one  in  1963.  Revenues  from 
miscellaneous  receipts,  primarily  a  nontax  source,  are  expected  to 
drop  substantially  in  1962  but  to  rise  in  1963  to  a  level  somewhat 
higher  than  in  1961. 

Actual  receipts  for  1961  and  estimated  receipts  for  1962  and  1963 
are  compared  by  major  sources  in  the  accompanying  table.  The 
amount  shown  for  each  revenue  source  is  the  net  amount  after  deduc- 
tion of  refunds  and  transfers  to  trust  funds. 


REVIEW    OF    FISCAL    OPERATIONS 


69 


Source 


1961  actual 


1962  esti- 
mate 


1963  esti- 
mate 


Increase 

196  i  over 

1962 


In  millions  of  dollars 


Individual  income  taxes... 
Corporation  income  taxes. 

Excise  taxes-.   

Employment  taxes.- 

Estate  and  gift  taxes 

Customs 

Miscellaneous  receipts 


41,338 

20, 954 

9,063 

(') 
1,896 
982 
4,080 


Subtotal  receipts.- 

Deduct: 

Interest  and  other  income  recei'Pd  by  Treasury 
from  Go  ornriient  aijencies  included  abO\e  and 
also  included  in  budget  expenditures 


78,313 


654 


Net  budget  receipts. 


45.000 
21,300 
9,627 


2,090 
1,215 
3,  .524 


82,  756 


82, 100 


49, 300 

26, 600 

9,956 


2.325 
1.320 
4.192 


93, 693 


693 
93, 000 


4,300 

5,300 

329 


235 
105 
668 


10,  937 


37 


10,900 


'  Negative  amount  of  $161,000. 

Individual  income  taxes  remain  by  far  the  most  important  source 
of  revenue,  providing  n:ore  than  50  percent  of  net  budget  receipts. 
The  corporation  income  tax  will  continue  as  the  second  most  impor- 
tant source.  Together,  the  income  taxes  will  account  for  more  than 
80  percent  of  budget  revenues. 

Individual  income  taxes. — Receipts  from  individual  income  taxes, 
withheld  and  not  withheld,  are  estimated  to  total  $45,000  million  in 
the  fiscal  year  1962,  an  increase  of  $3,662  million  over  1961.  This 
rise  in  individual  income  tax  receipts  is  responsible  for  over  80  percent 
of  the  increase  in  budget  revenues  for  1962.  A  rise  of  $4,300  million 
is  estimated  for  1963,  but  because  of  the  larger  increase  expected 
from  the  corporation  income  tax,  the  estimated  gain  in  1963  from  the 
individual  income  tax  accounts  for  only  about  40  percent  of  the  total 
gain  from  all  budget  revenue  sources. 

Withheld  tax  receipts  account  for  more  than  two-thirds  of  total 
individual  income  tax  receipts.  Since  gains  in  salaries  and  wages 
are  expected  to  be  greater  than  those  in  other  forms  of  taxable  personal 
incomes,  the  withheld  taxes  are  estimated  to  provide  over  85  percent 
of  the  rises  in  total  individual  income  tax  receipts  in  1962  and  1963. 

Corporation  income  taxes. — Receipts  from  the  corporation  income 
tax  are  expected  to  show  a  moderate  rise  from  $20,954  million  in  1961 
to  $21,300  million  in  1962.  A  substantial  gain  to  $26,600  milHon 
is  estimated  for  1963.  The  1963  gain  of  $5,300  milHon  accounts  for 
almost  50  percent  of  the  rise  in  total  revenues. 

Corporation  income  tax  receipts  in  each  fiscal  year  are  determined 
primarily  by  profits  of  the  calendar  year  ending  in  the  fiscal  year. 
The  expected  behavior  of  tax  receipts  for  1962  and  1963  reflects  the 
anticipated  small  rise  in  profits  in  the  calendar  year  1961  followed  by 
a  large  gain  of  approximately  $10.5  billion  in  the  calendar  year  1962. 


70     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Excise  taxes. — Net  excise  taxes  included  in  budget  receipts  are  esti- 
mated to  increase  from  $9,063  million  in  1961  to  $9,627  million  in  1962 
and  further  to  $9,956  million  in  1963.  Receipts  from  the  tax  on 
passenger  automobiles,  which  are  estimated  to  increase  by  $116  million 
in  1962  and  $155  million  in  1963,  provide  the  largest  single  increase, 
but  substantial  gains  in  both  1962  and  1963  are  expected  from  all 
iiuportant  revenue  sources  except  the  tax  on  transportation  of  persons 
which  will  be  lower  as  a  result  of  proposed  legislation. 

In  1963  all  of  the  revenues  from  the  10  percent  manufacturers' 
excise  tax  on  trucks,  buses,  and  trailers  will  be  transferred  to  the 
highway  trust  fund.  Previously  one-half  had  been  transferred.  The 
additional  transfer  will  reduce  net  excise  taxes  included  in  net  budget 
receipts  by  $135  milhon. 

Estate  and  gift  taxes. — Receipts  from  estate  and  gift  taxes  are  esti- 
mated to  increase  from  $1,896  million  in  1961  to  $2,090  million  in  1962 
and  $2,325  million  in  1963  as  security  and  other  asset  values  are  ex- 
pected to  rise. 

Customs. — Receipts  from  customs  which  had  declined  substantially 
in  the  fiscal  year  1961  are  estimated  to  rise  to  $1,215  million  in  1962, 
a  level  higher  than  realized  in  1960.  A  further  rise  to  $1,320  million 
is  anticipated  for  1963.  The  gains  for  1962  and  1963  reflect  the  esti- 
mated expansion  of  the  economy. 

Miscellaneous  receipts. — Revenues  from  miscellaneous  receipts  (net 
of  interfund  transactions),  which  were  unusually  large  in  the  fiscal 
year  1961  by  reason  of  the  large  loan  prepayment  by  the  Federal 
Republic  of  Germany,  are  expected  to  decline  by  $559  million  in  1962. 
For  the  fiscal  year  1963  revenues  are  expected  to  increase  by  $631 
million,  principally  because  of  repayment  to  the  general  fund  of 
advances  to  certain  States  for  temporary  unemployment  compensation 
during  the  1960-61  recession. 

BUDGET  EXPENDITURES  IN  1961 

The  $5.0  billion  increase  in  budget  expenditures  in  fiscal  1961  over 
those  in  1960  brought  the  total  to  $81.5  bilhon.  This  compared  to 
$80.3  billion  expended  in  fiscal  1959,  the  only  other  year  outside  of 
World  War  II  in  which  budget  expenditures  exceeded  $80  billion,  and 
like  1959  a  year  in  which  expenditures  were  affected  by  the  aftermath 
of  a  recession.     Major  functional  expenditures  for  the  fiscal  years 


REVIEW    OF    FISCAL    OPERATIONS 


71 


1953  through  1961  are  shown  in  table  12.  Their  distribution  from 
1957  (when  national  defense  expenditures  began  to  be  consistently 
above  $43  billion  a  year)  through  1961  is  shown  in  the  summary 
below. 


Fiscal  year 


Inter- 

Interfund 

National 

national 

Interest 

Other  1 

trans- 

defense 

affairs  and 
finance 

actions 
deducted 

Total ' 


In  billions  of  dollars 


1957, 
1958 
1959 
1960 
1961, 


43.4 

44.2 
46.5 
45,7 
47.5 


2.0 

7.3 

16.8 

0.5 

2.2 

7.7 

17.8 

0.6 

3.8 

7.7 

22.8 

0  4 

1.8 

9.3 

20.4 

0.7 

2.5 

9.0 

3  23.1 

0.7 

69.0 
71.4 
80.3 
76.5 
81.5 


1  Includes  veterans'  benefits  and  services  and  space  research  and  technology, 
s  Excludes  interfund  transactions. 
3  Includes  food  for  peace  program. 

National  defense  in  1961  accounted  for  $1.8  billion  of  the  increase 
over  1960,  and  was  58.3  percent  of  total  expenditures.  This  com- 
pared with  59.7  percent  in  1960,  57.9  percent  in  1959,  and  62.9  percent 
in  1957.  The  1961  dollar  increase  included  principally  a  rise  of 
approximately  $1.4  billion  for  military  research  and  development. 
The  overall  increase  more  than  offset  reductions  of  $0.2  billion  each 
for  military  procurement  and  military  assistance  to  strengthen  the 
forces  of  more  than  40  foreign  nations.  The  latter  decrease  reflected 
the  almost  complete  taking  over  by  the  industrialized  Western 
European  countries  of  the  cost  of  their  own  armaments. 

Economic  and  financial  assistance  abroad  was  mainly  responsible 
for  the  $0.7  billion  rise  in  spending  for  international  affairs  and  finance. 
The  total  of  $2.5  billion,  which  represented  3.1  percent  of  aU  expendi- 
tures, was  in  line  with  the  average  in  recent  years. 

A  decline  of  approximately  $0.2  billion  in  interest  expenditures  on 
the  public  debt  during  1961  accounted  for  the  comparable  decrease 
in  overall  interest  payments. 

Almost  all  of  the  remainder  of  $23.1  billion  was  spent  for  domestic 
programs.  This  spending  increased  $2.7  billion  in  1961  over  the  year 
before.  It  was  28.4  percent  of  total  expenditures  in  1961,  and  com- 
pared with  28.3  percent  in  1959,  and  with  24.3  percent  in  1957.  The 
tabulation  following  shows  the  principal  purposes  within  this  group. 


72 


1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


Fiscal  year 


1957 
1958 
1959 
1960 
1961. 


Veterans' 

\gri  culture 

Healtli, 

Commerce 

benefits 

and 

labor, 

and 

Other  ' 

and 

agricultural 

and 

transpor- 

services 

resources 

welfare 

tation 

Total  2 


In  billions  of  dollars 


4.9 

4.5 

2.6 

1.3 

3.4 

5.2 

4.4 

3.1 

1.6 

3.5 

5.3 

6.6 

3.9 

2.0 

5.0 

5.3 

4.9 

3.7 

2.0 

4.6 

5.4 

3  5.2 

4.2 

2.6 

5.7 

16.8 
17.8 
22.8 
20.4 
23.1 


'  Includes  space  research  and  technology. 

2  Includes  intertund  transactions. 

3  Includes  food  for  peace  program. 

Veterans'  benefits  and  services  continued  their  gradual  rise  vnth  an 
increase  of  approximately  $0.1  billion  in  expenditures  above  those  in 
1960.  This  expenditure  sometimes  has  been  categorized  historically 
with  national  defense,  international  affairs  and  finance,  and  interest 
on  the  public  debt  as  war  related  expenditures.  Expenditures  for 
agriculture,  which  rose  nearly  $0.3  billion  over  1960,  included  an 
increase  of  $0.2  billion  for  farm  income  stabilization  and  the  food  for 
peace  program. 

A  rise  of  approximately  $0.6  billion  during  1961  over  1960  in 
expenditures  for  health,  labor,  and  welfare  services  emphasized  the 
Government's  growing  concern  in  these  fields.  The  main  increase 
was  $0.3  billion  for  labor  and  manpower  services,  and  was  followed  by 
$0.1  billion  for  health  services  and  research,  and  a  like  increase  for 
public  assistance. 

The  largest  increase  in  expenditures  for  commerce  and  transporta- 
tion during  fiscal  1961  over  1960  was  that  of  approximately  $0.4 
billion  for  postal  services,  which  was  followed  by  one  of  approximately 
$0.1  billion  for  the  promotion  of  aviation.  These  constituted  the 
major  items  responsible  for  the  overall  increase  of  $0.6  billion  in  this 
category.  Space  research  and  technology  expenditures  amounted  to 
$0.7  billion,  an  increase  of  more  than  $0.3  billion. 

ESTIMATES  OF  EXPENDITURES  IN   1982  AND   1963 

Actual  expenditures  for  the  fiscal  year  1961  and  estimates  for  the 
fiscal  years  1962  and  1963  arc  summarized  in  the  following  table. 
Further  details  will  be  found  in  table  14.  The  estimates  are  based  on 
those  submitted  to  the  Congress  in  the  Budget  of  the  United  States 
Government  for  the  Fiscal  Year  Ending  June  30,  1963. 


REVIEW    OF    FISCAL    OPERATIONS 


73 


Actual  budget  expenditures  for  the  fiscal  year  1961   and  estimated  expenditures  for 

1962  and  1963 

[In  millions  of  dollars.    On  basis  of  1963  Budget  document] 


1961 
actual 


1962 
estimate 


1963 

estimate 


Legislative  branch 

The  judiciary 

Agriculture    Oepartment   (including   Commouity    Cret-it   Corpo- 
ration)  

Atomic  Energy  Commission 

Civil  Aeronautics  Board 

Civil  Service  Commission 

Commerce  Department 

Defense  I  epartnient: 

Military  functions _. 

Civil  functions 

Export-Import  Bank  of  Washinpton 

Federal  Aviation  A'.',ency 

Funds  appropriated  to  the  President: 

Foreign  assistance — economic 

Other — - 

General  Services  Administration - 

Health,  Education,  and  Welfare  Department 

Housing  and  Home  Finance  Agency 

Interior  Department 

Justice  Depaitraent 

Labor  Department 

National  Aero  lauties  and  Space  Admiidstration 

Post  Office  Department 

Small  Business  Administration 

State  Tepartment- 

Treasury  I  epartment: 

Interest  on  the  public  debt 

Other - 

Veterans'  Administration 

Allowance  for  contingencies  and  pay  adjustments 

All  other 


133 
52 

5,929 

2,713 

86 

74 

498 

44,  676 
972 
37 
638 

1,805 

387 
3,685 
502 
801 
284 
831 
744 
914 
103 


8,957 

996 

5,401 


161 
59 

7,177 

2.820 

92 

40 

650 

48,  250 

1,015 

alOl 

708 

1,935 
236 
501 

4,469 
940 
873 
298 
563 

1,300 
853 
250 
453 

8,900 

1,073 

5,560 

75 

572 


148 
63 

6,709 

2,880 

94 

43 

815 

49,  700 
1,071 

a225 

781 

2,235 

186 

578 

5.183 

1,383 

1,031 

304 

386 

2,400 

261 

222 

342 

9,300 

1,131 

5,285 

350 

574 


Total — . 

Deduct  interfund   transactions    (included   in   both   receipts  and 
expenditures) 


82, 169 
654 


89,  732 
656 


93, 230 
693 


Net  budget  expenditures. 


81,515 


89,  075 


92,  537 


a  Excess  of  credits  (deduct). 

Trust  Account  and  Other  Transactions 

Several  classes  of  financial  transactions  of  the  Government  (other 
than  budgetary  or  public  debt)  affect  the  cash  balance  of  the  Treas- 
urer of  the  United  States,  or  the  cash  held  outside  the  account  of  the 
Treasurer,  but  do  not  affect  the  Federal  budget  surplus  or  deficit. 
These  transactions  are  classified  in  Treasury  reports  as  follows :  Trust 
and  deposit  fund  accounts,  etc. ;  investments  of  Government  agencies 
in  public  debt  securities  (net) ;  and  sales  or  redemptions  of  obligations 
of  Government  agencies  in  the  market  (net).  Table  13  shows  the 
amounts  of  transactions  in  these  classifications  for  the  fiscal  years 
1952  through  1961,  and  table  15  contains  information  in  slightly 
more  detail  for  the  fiscal  year  1961  and  estimates  for  1962  and  1963, 


74     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Trust  and  deposit  fund  accounts 

Trust  funds  are  maintained  by  the  Government  to  account  for 
moneys  provided  for  specific  purposes  or  programs  in  accordance  with 
trust  agreements  or  statutes.  Transactions  in  trust  accounts  usually 
are  reported  on  a  gross  basis,  except  for  certain  trust  revolving  funds 
established  for  business-type  operations  which  are  reported  net. 
Reporting  on  a  net  basis  also  applies  to  deposit  fund  accounts,  where 
the  Government  is  holding  funds  in  suspense,  subject  to  refund  or 
transfer  to  other  Government  accounts,  or  where  the  Government  is 
acting  as  banker  or  agent  for  others.  In  I  he  fiscal  year  1961,  net  trans- 
actions in  trust  and  deposit  fund  accounts  resulted  in  an  excess  of 
receipts  aggregating  $565  million,  compared  with  a  $359  million 
excess  of  expenditures  in  1960. 

Investments  of  Government  agencies  in  public  debt  securities  (net) 

Purchases  and  sales  of  public  debt  securities,  together  with  nominal 
amounts  of  securities  of  Government  agencies,  are  included  in  this 
classification,  primarily  at  par  on  a  net  basis.  These  investments, 
which  usually  are  made  pursuant  to  legislative  requirements,  provide 
interest  income  on  funds  not  needed  for  current  expenditures.  The 
investment  transactions  are  not  reported  in  the  budget  or  trust 
account  operations  of  the  agencies  since  they  do  not  represent  pro- 
gram activities.  During  fiscal  1961,  the  excess  of  purchases  for 
public  enterprise  funds  and  trust  accounts  amounted  to  $435  million 
as  compared  with  $714  million  in  1960.  In  addition,  investment 
transactions  of  certain  deposit  funds  constituting  Government- 
sponsored  enterprises  resulted  in  an  excess  of  purchases  in  the  aggregate 
of  $434  million  during  1961  as  compared  with  $239  million  in  1960. 

Sales  and  redemptions  of  obligations  of  Government  agencies  in  the  market  (net) 
Certain  agencies  of  the  Government  have  authority  to  issue  obli- 
gations to  finance  their  operations,  as  explained  under  Corporations 
and  Certain  Other  Business-tj'pe  Activities  of  the  Government. 
Transactions  in  tliese  securities  during  the  fiscal  year,  reported  at 
their  par  value,  resulted  in  an  excess  of  redemptions  in  the  aggregate 
of  $733  million  as  compared  with  an  excess  of  issues,  or  sales,  of  $1,023 
million  in  1960.  In  addition,  transactions  in  the  obligations  of 
Government-sponsored  enterprises  showed  an  excess  of  issues  amount- 
ing to  $195  million  in  1961  and  $723  milHon  in  1960. 

Interest  rates  on  special  issues 

Trust  funds  administered  by  the  Treasury,  such  as  the  Federal 
old-age  and  survivors  insurance  trust  fund,  the  Federal  disability 
insurance  trust  fund,  the  civil  service  retirement  and  disability  fund, 
tlie  railroad  retirement   account,   and   the  veterans'  life  insurance 


REVIEW    OF   FISCAL    OPERATIONS  75 

funds,  are  invested  in  marketable  Government  securities  and  in  special 
public  debt  obligations  issued  specifically  to  each  fund.  The  interest 
rates  borne  by  special  public  debt  obligations  usually  are  established 
by  the  statutes  in  the  form  of  a  fixed  rate  or  a  varying  rate  based  on 
designated  classes  of  Government  securities  outstanding. 

In  view  of  the  higher  yield  on  marketable  Government  securities 
compared  with  statutory  rates  on  special  issues,  the  Treasury  has 
endeavored,  through  recommendations  to  the  Congress  and  by 
administrative  action,  to  obtain  greater  uniformity  in  interest  rates 
by  relating  the  rates  on  special  issues  to  yields  on  marketable  Govern- 
ment securities.  As  stated  in  the  1960  Annual  Report  (pp.  22-24), 
this  has  been  accomplished  with  respect  to  the  Federal  old-age  and 
survivors  insurance  trust  fund,  the  Federal  disability  insurance  trust 
fund,  and  the  veterans'  life  insurance  funds. 

In  August  1960  the  Treasury  recommended  a  change  in  the  statu- 
tory formula  for  determining  the  interest  rate  on  special  public  debt 
obligations  issued  to  the  civil  service  retirement  and  disability  fund. 
Public  Law  87-350,  approved  October  4,  1961  (75  Stat.  770),  author- 
ized a  formula  which  provides  that  these  special  issues  shall  bear 
interest  at  a  rate  equal  to  the  average  market  yield  (rounded  to  the 
nearest  multiple  of  l/8th  of  one  percent)  borne  by  all  marketable 
interest-bearing  obligations  of  the  United  States  that  are  not  due 
or  callable  untU  after  the  expiration  of  4  years.  (See  also  page  171 
of  this  report.) 

At  the  close  of  1961  the  formula  recommended  by  the  Treasury  for 
interest  rates  on  special  obligations  issued  to  the  raUroad  retirement 
account  had  not  been  enacted  into  law. 

Corporations    and    Certain    Other    Business-type    Activities   of   the 

Government 

In  accordance  with  statutory  authority,  various  business-type  pro- 
grams are  administered  by  Government  corporations  and  certain 
other  agencies.  These  programs  are  financed  by  appropriations, 
capital  stock  subscriptions,  borrowings  from  the  public  or  the  United 
States  Treasury,  or  from  the  revenues  of  the  corporation  or  agency. 
The  Secretary  of  the  Treasury  is  authorized  to  purchase  the  securities 
of  the  agencies  which  borrow  from  the  Treasury,  and  also,  under 
certain  circumstances,  to  prescribe  the  terms  and  conditions  of  then- 
obligations.  The  terms  of  the  securities  of  some  of  ^the  agencies 
which  borrow  from  the  public  must  be  approved  by  the  Secretary  of 
the  Treasury  in  accordance  with  provisions  of  the  Government 
Corporation  Control  Act  (31  U.S.C.  868).  The  agencies  that  are 
exempt  from  this  requirement  must  consult  with  the  Secretary  of  the 

614359—62 6 


76     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Treasury  before  issuing  obligations  to  the  public.  The  checking 
accounts  of  the  majority  of  the  Government  corporations  and  all 
other  business-type  activities  are  required  to  be  maintained  with  the 
Treasurer  of  the  United  States.  Subject  to  approval  of  the  Secretary 
of  the  Treasury,  some  accounts  msiy  be  kept  with  the  Federal  Reserve 
Banks  or  with  private  banks  that  have  been  designated  as  depositaries 
or  fiscal  agents  of  the  United  States. 

Financial  statements  submitted  to  the  Treasury 

Treasury  Department  Circular  No.  966  and  Supplement  No.  1, 
issued  under  authority  of  the  Budget  and  Accounting  Procedures  Act 
of  1950,  require  Government  corporations  and  agencies  to  submit 
financial  data  periodically.  Statements  of  assets  and  liabilities, 
income  and  expense,  and  source  and  application  of  funds  are  required 
quarterly,  while  a  statement  of  long-range  commitments  and  con- 
tingencies is  required  semiannually.  Government  agencies  that  are 
not  engaged  in  a  business-type  operation  are  required  to  submit  only 
a  statement  of  assets  and  liabilities  annually.  These  agency  reports 
serve  as  bases  for  combined  statements  compiled  by  the  Treasury  and 
designed  to  provide  full  disclosure  regarding  operations,  financial 
condition,  and  the  investment  of  the  United  States  in  these  enterprises. 

The  total  combined  assets  of  the  Government  corporations  and 
agencies  involved,  consisting  primarily  of  inventories,  receivables, 
and  fixed  property  (land,  structures,  and  equipment),  amounted  to 
$116,055  million  as  of  June  30,  1961,  compared  with  $111,129  million 
as  of  June  30,  1960.  The  combined  liabilities,  consisting  primarily 
of  accounts  payable  and  borrowings  from  the  pubhc,  amounted  to 
$7,865  million  as  of  June  30,  1961,  compared  with  $6,924  million  as  of 
June  30,  1960.  The  combined  total  of  the  Government's  investment 
amounted  to  $108,191  million  as  of  June  30,  1961,  compared  with 
$104,205  milHon  as  of  June  30,  1960.  Borrowings  from  the  Treasury 
are  reported  as  part  of  the  Government's  investment.  This  invest- 
ment is  exclusive  of  the  Government's  interest  in  mixed-ownership  or 
Government-sponsored  corporations,  which  amounted  to  $2,792 
million  on  June  30,  1961,  and  $2,650  miUion  on  June  30,  1960.  Indi- 
vidual and  combined  financial  statements  of  the  reporting  agencies 
are  published  pcriodicall}'  in  the  Treasury  Bulletin.  The  comparative 
combined  balance  sheet  data  as  of  June  30,  1952-1961,  are  shown  in 
table  125. 

Borrowing  authority  and  advances  by  the  Treasury 

New  congressional  authorizations  to  borrow,  made  available  during 
the  fiscal  year  1961,  amounted  to  $3,889  million,  while  reductions  in 
authority  amounted  to  $388  million;  resulting  in  a  net  increase  in 


REVIEW   OF   FISCAL    OPERATIONS  77 

borrowing  authority  of  $3,501  million.^  The  unused  authority  as  of 
June  30,  1961,  was  $22,480  million,  compared  with  $19,354"  million 
on  June  30,  1960.  The  status  of  borrowing  authority  of  these  corpo- 
rations and  agencies  is  shown  in  table  122. 

Loans  or  advances  of  funds  are  made  by  the  Secretary  of  the  Treas- 
ury to  certain  Government  corporations  and  agencies,  pursuant  to  the 
terms  of  the  borrowing  authorizations.  The  advances  by  the  Treasury 
are  secured  by  formal  obligations  or  agreements  executed  between  the 
Secretary  of  the  Treasury  and  the  head  of  the  agency  involved.  On 
the  financial  statements  of  the  agencies,  these  borrowings  or  advances 
are  reported  as  part  of  the  net  investment  of  the  United  States  in 
the  enterprise.  Excluding  refinancing  transactions,  such  advances 
by  the  Treasury  during  the  fiscal  year  1961  amounted  to  $7,537 
million,  compared  with  $6,734  million  in  1960;  repayments  amounted 
to  $7,163  miUion  as  compared  with  $6,441  million  in  1960.  The 
outstanding  loans  and  advances  amounted  to  $26,011  million  as  of 
June  30,  1961,  compared  with  $25,636  million  on  June  30,  1960. 
Table  124  describes  the  obligations  of  the  Government  corporations 
and  agencies  held  by  the  Treasury. 

Interest  and  other  payments  made  to  the  Treasury 

Except  where  fixed  by  law,  interest  rates  on  borrowings  from  the 
Treasury  are  determined  by  the  Treasury  from  month  to  month, 
taking  into  account  the  cost  of  Government  borrowings  in  the  current 
market,  as  reflected  by  the  prevailing  market  yields  on  Government 
obligations  with  maturities  corresponding  to  the  approximate  duration 
of  the  advances  to  the  Government  agencies.  The  amounts  of 
borrowings  from  the  Treasury  outstanding  as  of  June  30,  1961,  a 
description  of  the  securities  held,  and  their  rates  of  interest  are  given 
in  table  124. 

On  the  basis  of  operating  results  of  an  enterprise,  or  as  may  be 
required  by  law,  payments  to  the  Treasury  are  made  by  Government 
corporations  and  agencies  in  the  form  of  interest,  dividends,  and  dis- 
tribution of  earnings.  During  fiscal  1961,  interest  paid  to  the  Treas- 
ury amounted  to  $706  million  and  other  payments  amounted  to 
$112  million,  as  compared  with  $755  million  and  $76  million,  respec- 
tively, during  1960.  Details  regarding  these  payments  are  given 
in  table  127. 

Capital  stock  and  other  securities  owned  by  the  United  States 

The  Government's  investment  in  this  area  is  evidenced  by  various 
types  of  securities.  These  include  certificates  of  capital  stock,  bonds, 
and  notes  of  Government  corporations  and  agencies. 


1  The  borrowing  authority  for  19R0  was  revised  to  include  $150  million  of  borrowing  authority  from  the 
Treasury  Department  for  the  Tennessee  Valley  Authority. 
^  Revised. 


78     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  Government  purchased  $21.5  million  of  capital  stock  in  fiscal 
1961,  as  additional  subscriptions  to  the  capital  stock  of  Federal 
intermediate  credit  banks  in  the  amount  of  $6  million  and  preferred 
stock  of  the  Federal  National  Mortgage  Association  (secondary  market 
operations)  in  the  amount  of  $16  million.  Repayments  of  Govern- 
ment-held capital  stock  in  the  amount  of  $8  million  were  made  by  the 
banks  for  cooperatives.  The  amount  of  Government-held  capital 
stock  as  of  June  30,  1961,  and  the  changes  in  holdings  during  the 
year  are  shown  in  table  121. 

Guaranteed  obligations  of  Government  agencies 

Certain  Government  corporations  and  agencies,  with  authority  to 
borrow  from  the  public,  may  issue  obligations  which  are  guaranteed 
as  to  principal  and  interest  by  the  United  States.  The  issuance  of 
such  obligations  during  the  fiscal  year  1961  was  confined  to  notes  of 
the  District  of  Columbia  Armory  Board,  and  to  the  Federal  Housing 
Administration  debentures  issued  in  exchange  for  foreclosed  mort- 
gages on  behalf  of  its  various  mortgage  insurance  funds.  During 
fiscal  1961,  issues  of  guaranteed  obligations  amounted  to  $192  million 
and  redemptions  amounted  to  $92  million,  compared  with  $87  million 
and  $59  million,  respectively,  during  1960.  As  of  June  30,  1961,  the 
total  outstanding  (held  outside  the  Treasury)  was  $240  million, 
compared  with  $140  million  on  June  30,  1960.  Included  in  the 
amount  outstanding  was  $0.5  million  of  matured  obligations  of  liqui- 
dated corporations,  for  which  funds  for  payment  of  the  matured 
principal  and  the  interest  are  on  deposit  with  the  Treasurer  of  the 
United  States.  A  description  of  the  guaranteed  obligations  out- 
standing is  contained  in  table  31. 

Nonguaranteed  obligations  of  Government  agencies 

Certain  Government-owned  and  Government-sponsored  corpora- 
tions and  agencies  issue  to  the  public  nonguaranteed  obligations 
under  their  statutory  borrowing  authority.  They  include  the  Ten- 
nessee Valley  Authority,  the  Federal  National  Mortgage  Association, 
the  Federal  home  loan  banks,  Federal  land  banks.  Federal  intermediate 
credit  banks,  and  the  banks  for  cooperatives.  During  the  fiscal 
year  1961,  the  issues  of  nonguaranteed  obligations  amounted  to 
$6,616  million  and  redemptions  and  other  reductions  amounted  to 
$7,258  million,  as  compared  with  $7,800'  million  and  $6,100'  million, 
respectively,  during  1960.  The  total  nonguaranteed  obligations  out- 
standing totaled  $7,765  million  as  of  June  30,  1961,  and  $8,407 
million  as  of  June  30,  1960.  In  addition,  the  agencies  of  the  Farm 
Credit  Administration  obtain  funds  for  short  periods,  usually  between 

'Revised. 


REVIEW    OF    FISCAL    OPERATIONS  79 

bond  and  debenture  sales  dates,  by  issuing  notes  to  other  banks 
within  the  farm  credit  system  or  to  commercial  banks.  These  out- 
standing notes  amounted  to  $73  million  as  of  June  30,  1961,  and 
$79  million  as  of  June  30,  1960.  Certain  other  agencies  also  issue 
notes  at  infrequent  intervals  to  obtain  funds.  The  nonguaranteed 
obligations  outstanding,  for  each  issuing  agency  as  of  June  30,  1953- 
1961,  are  shown  in  table  27. 

Account  of  the  Treasurer  of  the  United  States 

Statements  of  the  account  of  the  Treasurer  of  the  United  States  are 
published  in  the  Daily  Statement  oj  the  United  States  Treasvry  in  sum- 
mary form,  and  in  more  detail  in  table  56.  The  account  consists  of 
three  major  categories:  Gold,  silver,  and  the  general  account.  As  of 
June  30,  1961,  the  total  value  of  gold  assets  was  $17,550  million,  held 
principally  in  the  Fort  Knox  Depository,  and  to  a  lesser  extent  in  mints 
and  assay  offices.  Liabilities  against  gold  include  $17,442  million  of 
gold  certificates  issued  to  Federal  Reserve  Banks  as  reserves  against 
Federal  Reserve  notes  and  amounts  held  for  redemption  of  United 
States  notes,  etc.  The  balance  of  $109  million  represents  available 
gold.  The  amount  of  silver  bullion  and  silver  dollars  included  in  the 
assets  totaled  $2,403  million,  against  which  liabilities  of  silver  certifi- 
cates (currency  issued  against  free  silver,  etc.)  amounted  to  $2,375  mil- 
lion, leaving  a  balance  of  silver  on  June  30,  1961,  of  $27  million.  The 
assets  of  the  general  account  on  June  30,  1961,  amounted  to  $6,769 
million,  and  included  gold  and  silver  against  which  there  are  no  specific 
legal  liabilities  or  reserves,  cash  in  the  form  of  coin  and  currency,  un- 
classified collections,  and  funds  on  deposit  with  Federal  Reserve  Banks 
and  other  depositaries.  Liabilities  of  the  general  account  totaled  $75 
million,  and  included  principally  funds  to  the  credit  of  the  Board  of 
Trustees  of  the  Postal  Savings  System  and  uncollected  items,  ex- 
changes, etc. 

The  balance  of  $6,694  million  in  the  Treasurer's  account  on  June  30, 
1961,  which  represents  the  difference  between  the  assets  and  liabihties, 
consists  of  current  operating  funds  on  deposit  in  Federal  Reserve 
Banks;  funds  available  for  transfer  to  Federal  Reserve  Banks  from 
Treasury  tax  and  loan  accounts  in  commercial  banks  qualified  as 
special  depositaries;  and  other  funds  in  general  and  other  depositaries 
not  immediately  available  for  operating  purposes. 

On  June  30,  1961,  the  balance  in  the  account  of  the  Treasurer  of  the 
United  States  was  $1,311  milHon  less  than  on  June  30,  1960.  Daily 
balances  during  the  year  ranged  from  a  high  of  $8,868  million  on 
July  13,  1960,  to  a  low  of  $2,501  million  on  April  18,  1961. 


80     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  net  change  in  the  balance  is  accounted  for  as  follows: 

Transactions  affecting  the  account  of  the  Treasurer  of  the  United  States,  fiscal  year 

1961 

[In  millions  of  dollars] 

Balance  June  30,  1960 8,  005 

Transactions  classified  on  p.  1  of  the  daily  Treasury  statement: 

Cash  deposits 96,  897 

Cash  withdrawals 98.  284 

Deduct  excess  withdrawals 1,  387 

Subtotal 6,618 

Transactions  classified  on  p.  2  of  the  daily  Treasury  statement: 

Add — net  increase  in  gross  public  debt 2,  640 

Subtotal 9,258 

Deduct: 

Excess  of  Government  agencies'  investments  over  re- 
demptions in  public  debt  securities 921 

Excess  of  redemptions  over  sales  of  obligations  of  Gov- 
ernment agencies  in  the  market 1,  107 

Accrual  of  discount  on  savings  bonds  and  bills 
(included  in  net  increase  in  gross  pubhc  debt, 
above) 2,  310 

Less  certain  public  debt  redemptions  (included 

in  cash  withdrawals,  above) 1,  774 

536 

Total  deductions 2,564 

Balance  June  30,  1961 6,  694 


Public  Debt  Operations  and  Ownership  of  Federal  Securities 

At  the  close  of  the  1961  fiscal  year  the  public  debt  and  guaranteed 
obligations  amounted  to  $289.2  bilhon,  a  net  increase  of  $2.7  billion 
from  the  $286.5  billion  outstanding  on  June  30,  1960. 

There  was  a  net  budget  deficit  of  $3.9  billion  in  the  fiscal  year  1961 
as  compared  with  a  surplus  of  $1.2  bilhon  in  the  previous  fiscal  j^ear. 
The  1961  deficit  was  financed  by  the  issuance  of  new  public  debt 
obligations  (that  is,  by  the  net  increase  in  total  outstanding  debt)  and 
by  a  drawing  down  of  the  cash  balance  from  $8.0  billion  on  June  30, 
1960,  to  $6.7  bilhon  on  June  30,  1961. 

A  summary  of  changes  in  the  debt  during  the  year  is  shown  in  the 
accompanying  table.  Changes  in  the  level  of  the  debt  since  1916  are 
illustrated  in  chart  3. 


REVIEW    OF    FISCAL    OPERATIONS 


81 


Class  of  debt 

June  30, 
1960 

June  30, 
1961 

Increase,  or 

decrease 

(-) 

In  billions  of  dollars 

Public  debt: 

Interest-bearinr: 
Public  issues: 

Marketable 

183.8 
54.5 

187.1 
53.5 

3  3 

Nonmarketable 

—  1.0 

Total  public  issues 

238.3 
44.9 

240.6 
45.0 

2  3 

Special  issues  to  Government  investment  accounts _ 

.  1 

Total  interest-bearing  public  debt 

283.2 

.4 

2.6 

285.7 

.3 

2.9 

2  4 

Matured  debt  on  which  interest  has  ceased 

—  1 

Debt  bearing  no  interest .  .  . 

.3 

Total  public  debt. ._.  .  _ 

286.3 
.1 

289.0 
.2 

2  6 

Guaranteed  obligations  not  owned  by  the  Treasury .__ 

.1 

Total  public  debt  and  guaranteed  obUgations ._  . 

286.5 

289.2 

2  7 

Of  the  $2.7  billion  total  increase  in  debt  during  the  fiscal  year, 
interest-bearing  issues  accounted  for  $2.4  billion  and  noninterest- 
bearing  debt  for  $0.2  billion.  There  was  also  an  $0.1  billion  increase 
in  guaranteed  obligations,  primarily  Federal  Housing  Administration 
debentures.  The  rise  in  public  issues  of  $2.3  billion  reflected  an 
increase  of  $3.3  billion  in  marketable  secm'ities  which  was  partially 
offset  by  a  decline  of  $1.0  billion  in  public  nonmarketable  issues. 


Chart  3 

THE  PUBLIC  DEBTi 


Including  public  debt  and  guaranteed  obligations. 
■  Excluding  Victory  Loan  proceeds  used  to  repay  debt  in  1946. 


82 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Marketable  issues  have  in  fact  been  an  increasing  proportion  of  the 
interest-bearmg  pubHc  issues  since  1952.  On  June  30,  1961,  marketa- 
ble issues  constituted  78  percent  of  the  interest-bearing  public  issues 
and  nonmarketable  22  percent,  as  compared  with  64  percent  and  36 
percent,  respectively,  on  June  30,  1952. 

Increases  in  the  marketable  debt  during  the  fiscal  year  1961  took 
place  entirely  in  the  relatively  short-term  area,  as  sho^vn  in  the  accom- 
panying table.  Regular  weekly  Treasury  bills  and  tax  anticipation 
bills  increased  by  $2.8  billion  and  $1.5  billion,  respectively^,  more  than 
compensating  for  the  cutback  from  $7.5  billion  to  $6.5  billion  in  1-year 
bills.  Certificates  of  indebtedness  outstanding  dropped  sharply,  partly 
because  of  the  Treasury's  greater  reliance  on  15-  to  18-month  Treasury 
notes.  Treasmy  bonds  outstanding  also  declined  somewhat  during 
the  fiscal  year. 


Class  of  security 


June  30, 

1960 


June  30, 

1961 


Increase,  or 

decrease 

(-) 


In  billions  of  dollars 


Treasury  bills  (regular  series): 

3-month  and  6-month.. 

1  -year.. 

Treasury  bills  (tax  anticipation  series). 

Certificates  of  indebtedness 

Treasury  notes 

Treasury  bonds 

Other  bonds 


25.9 
7.5 


17.7 
51.5 

81.2 


(*) 


Total  interest-bearing  public  marketable  issues. 


183.8 


28.7 
6.5 
1.5 
13.3 
56.3 
80.8 


187.1 


(*) 


2.8 
-1.0 

1.5 
-4.3 

4.8 
-.4 


3.3 


*Less  than  $50  million  Panama  Canal  bonds. 

Although  the  debt  of  $289.2  billion  as  of  June  30,  1961,  was  con- 
siderably higher  than  at  the  close  of  World  War  II  financing,  the 
debt  burden  has  actually  been  declining  since  1946  on  a  per  capita 
basis  and  as  a  percentage  of  gross  national  product.  As  shown  in 
chart  4,  per  capita  debt  declined  from  $1,832  on  December  31, 
1946,  to  $1,575  on  June  30,  1961.  The  total  debt  dropped  from 
an  amount  which  was  considerably  more  than  the  gross  national 
product  in  1946  to  an  amount  equal  to  56  percent  of  the  gross  national 
product  on  June  30,  1961. 

A  large  part  of  the  reduction  in  the  debt  burden  in  terms  of  the 
gross  national  product  represents  real  growth  in  the  economy.  Part 
of  it,  however,  reflects  inflationary  price  advances. 

Chart  4  shows  that  the  Federal  debt  has  grown  b}'  a  little  over 
10  percent  during  the  postwar  period.  At  the  end  of  the  fiscal  year 
1961  it  represented  28  percent  of  the  total  debt  of  the  country.  While 
other  forms  of  debt  have  grown  at  a  much  faster  rate  since  1946,  the 
$289  billion  of  debt  owed  by  the  Federal  Government  still  exercises 
a  predominant  influence  in  financial  markets. 


REVIEW    OF   FISCAL    OPERATIONS 
Chaet  4 

THE  PUBLIC  DEBT  IN  A  GROWING  ECONOMY 


83 


1200 


too 


800 


1946 


1961 


As  %  of  Gross  National 
Product 


¥^;^■>.:::^■,^;>^ 

iii 


1946 

Dec. 


400 


Relative  to  Total  Debt 
(Public  and  Privote) 

1,018 


58%. 


iiioy 


^&oU 


♦^  Federa/ 


State  and 
Local 


*^  Corporate 


'*^  Individual 


1946 

Dec. 


1961 

June 


Progress  toward  debt  management  objectives 

Exclusive  of  Treasury  bills  the  Treasury  issued  $45.8  billion  in 
new  securities  during  fiscal  1961.  All  these  securities  were  issued 
in  the  course  of  operations  to  refinance  existing  obligations  either  at 
maturity  or  in  advance  of  maturity.  In  addition  new  issues  of  tax 
anticipation  bills  and  one-year  bills  totaled  $15.0  billion,  and  regular 
weekly  offerings  were  increased  $2.8  billion  during  the  year,  including 
$1.8  billion  issued  on  June  14,  1961,  to  mature  on  18  weekly  bill 
maturity  dates  between  August  3  and  November  30,  1961.  The  June 
offering  of  a  "strip"  of  bills  was  designed  to  meet  the  Treasury's 
need  for  funds  without  the  necessity  of  a  succession  of  increases  in 
weekly  bill  offerings. 

The  Treasury  in  its  debt  management  programs  during  the  fiscal 
year  concentrated  new  cash  financings  in  short-term  issues,  as  previ- 
ously mentioned.  Longer  term  holdings  were  increased  and  the 
debt  structure  improved  through  advance  refunding  and  through  the 
terms  of  the  Treasury's  regular  refunding  operations. 

The  under  1-year  debt  increased  by  $11  billion  to  $81J^  billion  dur- 
ing the  fiscal  year,  while  the  1-  to  5-year  maturities  decHned  from  $73 
billion  to  $58K  bilHon.  The  over  5-year  debt  increased  from  $40}^ 
billion  as  of  June  30,  1960,  to  $47^  billion  as  of  June  30,  1961.  As 
shown  in  chart  5,  $36j^  bilHon  of  the  over  5-year  debt  at  the  end  of 


84 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


the  fiscal  year  was  in  the  maturity  range  of  5-  to  20-years  while  $11 
billion  was  in  the  20-year  and  over  area.  These  structural  changes 
resulted  in  a  2-month  increase  in  the  average  length  of  the  marketable 
debt,  from  4  years  4  months  on  June  30,  1960,  to  4  years  6  months  on 
June  30,  1961. 

Chart  5 

STRUCTURE  OF  THE  PUBLIC  DEBT  JUNE  30,1961  _ 


$Bil. 


Total 


Marketoble 


Nonmarketable 


200 


■289 


100- 


Time  to  Maturity^ 


20  Years 

and  Over  *»* , ,  |.;.!.v!:!.!.njji 


Savings  Bonds-47'/2'^   f^^ii'*^EandH 


t  Other 


58/2 


8l'/2 


45 


>  Investment 
Bonds,  etc. 


//A^5to20 
'^aI'^Va        Years 


.lto5 
Years 


•*^  Within  I  Year 


\ 


Special  Issues 
to  Trust  Funds 


1  Partially  tax-exempt  bonds  are  classified  to  earliest  caU  date. 

The  Treasury's  progress  in  extending  debt  maturities  during  fiscal 
1961  was  due  almost  entirely  to  a  series  of  operations  in  which  out- 
standing obligations  were  refunded  in  advance  of  maturity.  Advance 
refunding  operations  have  been  of  two  tj^pes:  Senior  advance  refund- 
ing, in  which  holders  of  securities  of  intermediate  maturities  are  offered 
the  opportunity  to  exchange  into  longer  term  issues,  and  junior  ad- 
vance refunding,  in  which  holders  of  relatively  short-term  issues  are 
offered  the  opportunity  to  exchange  into  securities  in  the  intermediate 
range. 

Under  circumstances  where  the  market  envu-onment  is  favorable, 
the  refunding  of  securities  in  advance  of  maturity  offers  a  number  of 
advantages  both  to  the  economy  and  to  the  Treasury.  The  economy 
benefits  because  debt  extension  is  accomplished  with  a  minimum 
change  of  ownership.  The  adverse  market  impact  of  a  comparable 
cash  offering  is  avoided,  and  the  flow  of  ncAV  savings  into  the  private 
sector  of  the  economy  is  not  significantly  disturbed.     Junior  advance 


REVIEW    OF    FISCAL    OPERATIONS 


85 


Chart  6 


COMPARISON  OF  EXTENSIONS  OF  MATURITY  IN. 
ADVANCE  REFUNDINGS 


Total  Amount 
Extended 


$  Billions-Years 
of  Extension 


Average  Length 
of  Extension 


%  of  Publicly 
Held  Extended 


($  Billions) 


6.0 


(Yeors- Months) 

Junior  Refundings 


WM. 


.W.W.'.'.'.'J 

N-4 


30% 


June '60       Mar '61 


40 


June  '60        Mor.'6l 


i  98 


June '60        Mar. '61  June '60        Mar. '61 

Senior  Refundings 


247: 


— I 

J 

;  31% 


Oct  60        Sept '61 


Oct '60        Sept. '61 


Oct  60        Sept '61 


Oct  60        Sept '61 


refundings  have  the  further  advantage  of  reducing  inflationary  pres- 
sures through  curtaiUng  the  amount  of  highly  liquid  short-term  debt. 

From  the  point  of  view  of  the  Treasury,  advance  refunding  offers  a 
mechanism  not  only  for  extending  the  average  length  of  the  debt  but 
also  for  transferring  blocks  of  securities  out  of  a  maturity  area  where 
undue  concentration  may  have  occurred.  The  Treasury  also  benefits 
along  with  the  economy  from  the  fact  that  long-term  investors  are 
encouraged  to  continue  their  ownership  of  Federal  Government  securi- 
ties without  interruption. 

Two  junior  advance  refundings  and  two  senior  advance  refundings 
took  place  in  the  period  beginning  with  June  1960  and  extending 
through  December  1961.  The  first  of  these  was  at  the  end  of  fiscal 
1960,  the  second  and  third  during  fiscal  1961,  and  the  last  one  in 
September  1961.  Although  only  two  of  these  operations  occurred  in 
fiscal  1961,  for  purposes  of  comparison  all  four  are  considered  in  the 
following  discussion  and  are  shown  in  the  accompanying  charts  6 
and  7.1 

The  bars  in  the  first  column  of  chart  6  show  the  amounts  of  debt 
shifted  to  longer  maturities  in  the  four  advance  refunding  operations, 


>  Information  on  the  June  1960  junior  advance  refunding  will  be  found  in  the  annual  report  for  1960,  on  p 
29  and  in  e.xhibit  3.  Later  advance  refunding  operations  are  discussed  in  the  account  of  Debt  Management 
beginning  on  p.  15  of  this  report.  Further  details  of  operations  during  the  fiscal  year  1961  are  given  in 
exhbit  3. 


86     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

$10.2  billion  in  the  junior  refundings,  and  $7.8  billion  in  the  senior 
refundings. 

The  impact  of  any  advance  refunding  operation  on  the  structure  of 
the  marketable  debt  as  measured  by  the  average  term  to  maturity 
is  dependent  on  the  product  of  the  two  factors  involved,  namely,  the 
amount  of  debt  extended  and  the  length  of  the  extension.  In  effect, 
this  means  that  $10  billion  of  debt  extended  for  1  year  provides  the 
same  degree  of  debt  lengthening  as  $2  billion  extended  for  5  j^ears. 
The  product  in  either  case  is  10  billion  dollar-years.  As  shown  in 
chart  6,  the  June  1960  operation  amounted  to  12  billion  dollar-years 
and  the  March  1960  refunding  to  26  billion.  In  the  same  context 
the  amounts  for  the  two  senior  advance  refundings  were  98  billion 
in  the  October  1960  operation  and  72  billion  in  September  1961. 
The  larger  figures  in  the  two  senior  refundings  are  due  to  the  longer 
extensions  of  the  eligible  issues  involved. 

The  degree  of  debt  lengthening  in  each  operation  is  indicated  in  the 
third  column  of  chart  6  headed  "average  length  of  extension."  The 
figures  in  this  column  were  obtained  by  dividing  each  of  the  biUion- 
doUar-year  figures  by  the  amount  of  debt  extended.  As  shown  on 
chart  6,  in  the  June  1960  refunding  $4.2  billion  of  debt  was  extended 
by  an  average  of  2  years  10  months  and  in  March  1961  $6.0  billion 
of  debt  was  extended  by  4  years  4  months.  The  average  lengths  of 
extension  in  the  two  senior  refundings  were  much  greater:  24  years 
7  months  in  October  1960  and  19  years  2  months  in  September  1961. 

In  terms  of  the  impact  of  advance  refunding  on  the  length  of  the 
more  than  $180  billion  of  marketable  debt,  the  two  junior  advance 
refundings  increased  total  average  length  by  0.8  month  and  1.6 
months,  respectively.  The  two  senior  advance  refundings,  with  their 
greater  debt  extensions,  increased  the  marketable  debt  length  by  6.3 
months  and  4.5  months,  respectively. 

A  significant  measure  of  the  success  of  an  advance  refunding  opera- 
tion is  the  percentage  of  old  issues  turned  in  for  new,  particularly  by 
public  holders  (that  is,  holders  other  than  the  Federal  Reserve  and 
Government  investment  accounts).  In  junior  advance  refundings 
investors  must  weigh  the  advantages  of  the  exchange  against  some 
loss  of  liquidity  and  in  senior  advance  refundings  the  greater  risk  of 
capital  loss  due  to  the  much  longer  extensions  of  maturit}^  In  view  of 
these  conditions,  the  proportion  of  the  public's  holdings  which  has 
been  extended  in  the  four  advance  refundings  shows  that  these  opera- 
tions have  been  highly  successful.  As  apparent  in  chart  6,  public 
holders  of  securities  eligible  for  junior  advance  refunding  turned  in  37 
percent  of  their  holdings  in  June  1960  and  30  percent  in  March  1961. 
The  comparable  figures  for  the  senior  advance  refunding  operations  of 


REVIEW    OF    FISCAL    OPERATIONS  87 

Chabt  1 

^PUBLIC  HOLDINGS  EXTENDED  IN  ADVANCE  REFUNDINGS^ 


$Bil. 


2- 


June  I960: 

Totol  Amount.. $4.1  billion 


Junior  Refundings 


Mar.  1961:  $5.4  billion 


A%  of  Holdings 

f         FvtonHeH 


-.43% 


Extended 


WM^--'iS>\ 


.28% 


5— -36% 


1 1.6^-34% 


Oct.  I960:  «.4 billion 


Senior  Refundings 


3^-8% 


1.9. 


.49% 


^ffffffi 

lis  -'^"^ 


Sept.  1961:  $2.8  billion 


.29% 


-62% 


-44% 


Com"! 
Banks 


Insur.  Go's, 
Mut.  Sov.Bks 


All 
Other 


Com'I 
Banks 


Insur.  Go's,  All 

Mut.Sav.Bks.       Other 


October  1960  and  September  1961  were  31  percent  and  51  percent, 
respectively. 

Chart  7  gives  further  information  on  the  response  of  various  classes 
of  investors  to  the  four  advance  refunding  operations. 

Commercial  banks,  which  were  large  holders  of  the  short-term 
securities  involved  in  the  junior  refundings,  turned  in  43  percent  of 
their  holdings  in  June  1960  and  28  percent  in  March  1961.  Insurance 
companies  and  mutual  savings  banks  exchanged  40  percent  of  their 
relatively  small  holdings  in  June  and  36  percent  in  March. 

Since  savings  type  institutions  were  much  more  heavily  invested  in 
the  obligations  involved  in  the  senior  refundings,  they  likewise  were 
much  more  interested  in  extending  the  maturities  of  their  medium- 
term  holdings  than  they  had  been  in  exchanging  their  short-term 
securities  for  medium-term.  In  October  1960,  insurance  companies 
and  mutual  savings  banks  exchanged  49  percent  of  their  medium-term 
securities  for  the  new  long-term  offerings,  and  in  September  1961  they 
exchanged  62  percent.  Commercial  banks  held  only  smaU  amounts 
of  the  issues  involved  in  these  two  exchange  offers. 

In  addition  to  advance  refunding  in  the  long-term  area  and  the 
issuance  of  "strip"  bills  in  place  of  a  succession  of  increases  in  weekly 
bill  offerings,  the  Treasury  made  another  change  in  debt  management 


88  1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Chart  8 


MARKET  YIELD  TRENDS 


OF  SHORT  AND  LONG-TERM  SECURITIES 


Monthly  Averages 


''"l"'"l"'"l"l"l IiiIi.ImIliI Iiiliil I.iliil Iiil,,liil 


Long-Term 
Treasury  BondS'K^^^ 


|"|"'"|"|" 


1953      '54 


'55 


'56        '57 


'58        '59 


•60 


•61 


practice  during  fiscal  1961.  This  was  the  refunding  of  maturing 
obligations  by  means  of  a  cash  offering  of  new  securities  used  in  whole 
or  in  part  to  pay  ofT  the  maturities,  a  technique  which  had  not  been 
used  since  the  World  War  II  financing  period.  On  three  occasions 
during  the  fiscal  year,  in  August  1960,  in  February  1961,  and  in  May 
1961,  this  method  was  used  in  place  of  an  exchange  offering  which 
would  have  given  holders  at  the  time  of  the  offering  preemptive  rights 
to  subscribe  to  new  issues. 

One  of  the  important  considerations  in  setting  the  terms  of  a  new 
offering  is  the  pattern  of  market  yields  existing  at  the  time.  For  a 
financing  operation  to  be  successful,  the  interest  rate  on  a  new 
Treasiu"y  issue  must  be  in  line  \vith  the  return  which  investors  are 
able  to  get  on  existing  issues  of  comparable  maturity.  Chart  8,  which 
shows  the  trend  in  the  market  3ields  of  long-term  Treasury  bonds  and 
the  shortest  term  Treasury  bills  over  a  period  of  time,  illustrates  the 
background  against  which  financing  operations  in  the  long-  and  short- 
term  areas  have  taken  place  during  fiscal  1961  and  in  other  recent 
years. 

As  indicated  in  the  chart,  average  monthly  market  j'ields  on 
Treasury  bonds  which  were  neither  due  nor  callable  before  10  years 
were  relatively  stable  during  the  fiscal  year  ending  June  30,  1961, 
ranging  between  a  high  of  3.93  percent  (November  1960)  and  a  low  of 


REVIEW    OF    FISCAL    OPERATIONS  89 

3.73  percent  (May  1961).  During  the  previous  fiscal  year  yields  on 
Treasury  bonds  averaged  above  4  percent  in  every  month  except 
June  1960,  when  the  average  was  3.98  percent.  The  highest,  4.37 
percent,  was  reached  in  January  1960. 

Market  yields  on  the  longest  outstanding  91-day  Treasury  bills  also 
fluctuated  within  narrow  limits  during  fiscal  1961.  A  high  of  2.48 
percent  was  reached  in  September  1960  as  compared  with  a  low  of  2.24 
percent  in  January  1961.  During  the  year  before,  in  contrast,  yields 
on  outstanding  91-day  bills  fluctuated  widely,  rising  from  3.21  percent 
in  July  1959  to  4.51  percent  in  December  1959  and  thereafter  declining 
sharply  to  2.46  percent  in  June  1960. 

The  average  rates  on  new  offerings  of  regular  weekly  bills  throughout 
the  year  are  shown  in  exhibit  4,  and  the  monthly  average  yields  of 
long-term  Treasury  bonds  will  be  found  in  table  51.  The  computed 
annual  interest  rate  and  the  computed  annual  interest  charge  on  the 
public  debt  by  security  classes  will  be  found  in  table  48. 

PUBLIC  DEBT  OPERATIONS 

The  first  financing  of  fiscal  1961  was  the  offering  of  a  tax  anticipa- 
tion security  undertaken  to  cover  the  major  share  of  the  Treasury's 
seasonal  needs  for  cash  in  the  first  quarter  of  the  fiscal  year.  Tax  antic- 
ipation seciu-ities  are  planned  to  provide  the  Treasury  with  funds 
during  periods  when  tax  collections  are  seasonally  low,  and  to  provide 
an  investment  medium  for  funds  accumulated  b}^  corporations  during 
such  periods  to  pay  income  and  profits  taxes.  The  securities  are 
retired  at  maturity,  to  the  extent  they  are  not  presented  in  payment 
of  taxes,  with  the  proceeds  of  tax  receipts  flowdng  in  on  tax  payment 
dates. 

Early  in  July  1960,  on  an  auction  basis,  the  Treasury  issued  for  cash 
$3)2  billion  of  tax  anticipation  bills  to  mature  shortly  after  the  mid- 
March  1961  tax  collection  date  and  $1K  billion  of  one-year  Treasury 
bills  to  matm-e  July  15,  1961.  The  latter  offering  represented  a 
partial  rollover  of  the  $2  billion  of  one-year  bills  maturing  on  July  15 
in  accordance  with  the  pattern  previously  established  by  the  Treasury 
of  one-year  maturities  on  quarterly  dates  in  January,  April,  July, 
and  October. 

On  July  25,  1960,  the  Treasury  announced  that  it  would  pay  off  in 
cash  the  $9.6  billion  of  4%  percent  Treasury  notes  maturing  August  15 
and  the  $0.8  billion  of  Federal  National  Mortgage  Association  3% 
percent  notes  maturing  August  23.  This  marked  the  first  occasion 
in  recent  years  on  which  the  Treasury  used  the  cash  refunding  method, 
in  preference  to  giving  holders  of  maturmg  obligations  the  exclusive 
right  to  exchange  their  old  securities  for  new  ones.  In  order  that 
holders  of  the  Federal  National  Mortgage  Association   maturities 


90     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

might  have  an  opportunity  to  reinvest  the  proceeds,  the  Secretary 
of  the  Treasury  in  behalf  of  the  Association  offered  to  purchase  such 
notes  on  August  15  at  par.  Funds  for  the  retirement  of  the  Treasury 
and  Federal  National  Mortgage  Association  notes  were  derived  from 
new  issues  totaling  $8.9  billion,  plus  withdrawals  from  the  cash  balance. 
Of  the  $9.6  billion  of  Treasmy  notes  retired,  $1.0  billion  was  charged 
against  the  sinking  fund.  (Tables  41  and  42  give  further  information 
on  sinldng  fund  operations.) 

The  new  issues  in  August  consisted  of  $7.8  billion  of  11}^  month 
3}^  percent  certificates  to  matm^e  August  1,  1961,  and  $1.1  billion 
of  additional  3%  percent  Treasury  bonds  of  1968.  Although  no 
exchange  privileges  were  granted  to  holders  of  matm-ing  secm-ities, 
these  owners  were  permitted  to  use  their  securities  for  do\vnpayments 
where  required;  they  could  also  turn  in  their  holdings  in  payment  for 
new  secmities  allotted  them. 

Following  the  use  of  the  advance  refunding  technique  in  the 
junior  operation  of  June  1960,  the  Treasury  on  September  9,  1960, 
announced  its  first  senior  advance  refunding.  This  was  an  offering 
of  three  issues  of  Sji  percent  long-term  bonds  (two  issues  of  new 
securities  to  mature  in  1980  and  1998,  respectively,  and  additional 
amounts  of  the  S^s  of  1990,  first  issued  in  February  1958)  to  holders 
of  four  issues  of  wartime  2}^  percent  Treasury  bonds  maturing  be- 
tween June  15,  1967,  and  December  15,  1969,  outstanding  in  the 
amount  of  $12K  billion.  An  outside  limit  of  $4.5  billion  was  placed 
on  the  combined  amounts  of  the  1990  and  1998  maturities  issued  to 
the  public.  No  limit  was  placed  on  the  issue  maturing  in  1980. 
The  issue  eligible  for  exchange  into  the  1980  maturity  was  the  smallest 
of  the  group  of  wartime  2)^s  involved  in  the  refunding  operation. 
In  addition,  it  was  largely  held  by  commercial  banks  which  are  tradi- 
tionally interested  mainly  in  short-term  holdings  and  thus  were  not 
expected  to  subscribe  heavily  to  the  new  and  longer  term  exchange 
offering. 

Participants  in  this  exchange  were  primarily  long-term  investors 
who  were  interested  in  extending  the  maturity  of  their  holdings. 
Subscriptions  totaled  $4  bilhon  and  were  allotted  in  full.  As  a  result 
of  this  single  operation  the  amount  of  outstanding  Treasury  bonds 
with  maturities  beyond  15  years  increased  by  nearly  one-half,  from 
$8.5  billion  to  $12.5  billion,  and  the  e  verage  length  of  the  marketable 
public  debt  was  extended  from  appj  oximately  4  years  2  months  to 
4  years  9  months. 

The  financing  operations  of  Octobar  were  minor  as  compared  with 
those  of  August  and  September,  and  were  confined  entirely  to  the 
short-term  area.  The  first  item  on  the  program  was  a  cash  retirement 
in  the  amount  of  $278  million  of  the  1}^  percent  exchange  notes  due 


REVIEW    OF   FISCAL    OPERATIONS  91 

October  1,  1960.  Following  that,  the  Treasury  on  October  11  auc- 
tioned a  l-3^ear  bill  in  the  amount  of  SlK  billion,  to  replace  the  $2 
billion  of  bills  coming  due  on  October  17,  thus  continuing  the  July- 
practice  of  cutting  back  somewhat  the  existing  one-year  bill  maturities. 
At  the  same  time,  announcement  was  made  of  a  $3^  billion  June 
1961  tax  biU,  subsequently  auctioned  on  October  18. 

Securities  coming  due  on  November  15  amounted  to  $10.8  billion, 
$7.0  billion  4%  percent  certificates  and  $3.8  billion  2}^  percent  bonds. 
Holders  of  these  issues  were  offered  a  5K-year  3%  percent  bond,  to 
mature  May  15,  1966,  and  a  15-month  3X  percent  Treasury  note 
to  mature  February  15,  1962.  About  $10.3  billion  of  the  November 
15  maturities  was  exchanged  for  the  new  issues,  $9.1  billion  for  the 
note  and  $1.2  billion  for  the  bond.  The  remaining  $0.5  billion  of 
maturing  securities  was  paid  off  in  cash. 

Shortly  after  this  operation  the  Treasury  announced  an  exchange 
offering  to  holders  of  approximately  $750  million  Series  F  and  G  sav- 
ings bonds  maturing  in  1961.  Owners  of  these  maturing  obligations 
were  offered  in  exchange  marketable  4  percent  Treasury  bonds  of 
1969  (a  reopening  of  bonds  first  offered  in  October  1957)  at  a  price 
of  lOOK  with  certain  interest  and  other  adjustments  as  of  December 
15,  1960.  The  exchange  offer  was  accepted  by  holders  of  $148  million 
of  the  1961  F  and  G  maturities  outstanding. 

The  first  financing  operation  of  the  calendar  year  1961  wasj.the 
rollover  of  $1.5  billion  of  1-year  bills  which  took  place  on  January  15. 
The  budget  situation  made  it  necessary  for  the  Treasury  to  obtain 
new  cash,  however,  and  this  was  done  through  increases  of  $0.5  bil- 
lion in  the  regular  weekly  bill  offerings  durmg  the  period  January  19 
through  February  2. 

The  Treasury's  decision  to  raise  new  money  at  that  time  through 
offerings  of  relatively  short-term  securities  was  further  reflected  in 
the  issuance  of  a  3%  percent  18-month  note  on  February  15,  1961. 
Funds  in  the  amount  of  $7.3  billion  derived  from  this  operation  were 
used  to  redeem  the  $6.9  billion  of  4%  percent  certificates  coming  due 
on  the  same  date  and  also  to  supply  the  Treasury  with  an  extra  $0.4 
billion  of  cash  for  operating  purposes,  brmging  to  $0.9  billion  the 
amount  of  new  money  borrowed  since  January  1,  1961. 

In  mid-March  the  Treasury  undertook  its  second  junior  advance 
refunding.  (The  fii'st  had  taken  place  in  June  1960.)  Holders  of  four 
issues  of  outstanding  Treasury  bonds  and  notes  maturing  from  June 
15,  1962,  thi'ough  August  15,  1963,  were  offered  in  exchange  two  issues 
of  intermediate-term  securities  dated  March  15,  1961,  a  3%  percent 
Treasury  bond  to  mature  on  November  15,  1966,  and  a  3%  percent 
Treasury  bond  to  mature  on  November  15,  1967.  The  Treasury 
placed  a  limit  of  $5  biUion  on  the  aggregate  amount  of  3%  percent 

614.359—62 7 


92     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

bonds  it  would  issue,  and  a  limit  of  $3  billion  on  the  3%  percent  issue. 
In  all,  subscriptions  of  $6.0  billion  were  received  and  were  allotted  in 
full,  $2.4  billion  for  the  5-year  8-month  Sji  percent  bond  and  $3.6 
billion  for  the  6-year  8-month  Sji  percent  bond.  As  a  result  of  this 
operation,  congestion  in  the  1962  and  1963  maturity  schedules  was 
significantly  reduced  at  the  same  time  that  holders  of  short-term  U.S. 
Government  securities  were  encouraged  to  lengthen  theu'  investments. 

Shortly  after  the  advance  refunding  operation  was  completed,  the 
Treasury  turned  to  the  bill  market  for  meeting  its  current  require- 
ments for  new  cash.  These  were  covered  through  a  $1/2  billion  issue 
of  Treasury  tax  anticipation  bills  dated  April  3,  1961,  to  be  acceptable 
in  payment  of  income  taxes  due  in  September  1961,  and  b}'  increases 
totaling  $0.3  billion  in  regular  weeldy  bill  offerings  during  March  and 
April.  In  addition,  on  April  15,  the  $2.0  billion  one-year  bill  maturity 
was  rolled  over  in  its  entirety. 

Plans  for  meeting  the  May  15  certificate  and  note  maturities, 
amounting  to  $7.8  billion,  were  announced  late  in  April.  To  obtain 
the  funds  for  pa^dng  off  these  holders  and  to  raise  some  additional 
cash,  the  Treasury  issued  a  total  of  $8.3  billion  of  new  securities,  $5.5 
billion  of  3  percent  Treasury  certificates  to  mature  May  15,  1962,  and 
$2.8  billion  of  3}^  percent  Treasury  notes  to  mature  Alay  1963.  As 
before,  in  the  cash  refunduigs  of  August  1960  and  February  1961, 
owners  of  maturing  securities  were  permitted  to  use  their  holdings  to 
make  downpayments  when  required  or  to  make  payments  on  secu- 
rities allotted  to  them. 

The  $0.5  billion  of  new  cash  raised  in  this  operation,  together  with 
an  $0.2  billion  addition  to  regular  weekl}^  bills  between  May  4  and 
May  11,  was  largely  absorbed  by  increases  in  the  cash  balance.  To 
obtain  new  funds  for  current  expenditures  the  Treasury  again  turned 
to  the  bill  market,  but  by  means  of  a  novel  operation  designed  to  pro- 
vide the  necessar}'  funds  in  a  single  financing  and  to  give  investors  a 
range  of  maturities.  In  this  operation,  regular  weeldy  bills  were  in- 
creased by  $1.8  billion,  approximately  $0.1  billion  of  which  matured 
each  week  over  the  18-week  period  August  3-November  30,  inclusive. 
Subscriptions  were  required  to  be  in  units  of  $18,000,  with  a  single 
price  submitted  for  each  "strip"  of  18  maturities  or  multiple  thereof. 
The  offering  of  strip  bUls  was  the  final  financing  operation  of  the  fiscal 
year. 

The  following  tables  summarize  the  financing  operations  during  the 
fiscal  year  and  show  the  results  of  the  public  oftcrings  of  marketable 
Treasury  securities,  excluding  the  refinancing  of  regular  weekly  bills. 


REVIEW    OF    FISCAL    OPERATIONS 


93 


For  additional  information  see  table  38  for  allotments  by  investor 
classes  and  the  exhibits  on  public  debt  operations  beginning  on 
page  233. 


Public  offerings  of  marketable  Treasury  securities  excluding  refinancing  of  regular 
weekly  bills,  fiscal  year  1961 

[In  millions  of  dollars] 


Date 


Description  of  security 


Issued  for  cash 


For 

new 

money 


For  re 
funding 


Issued  in 
exchange 


For  ma- 
turing 
issue 


In  ad- 
vance 
refund' 
ing 


Total 


1960 

Apr. 

1 

Aug. 

15 

Aug. 

15 

Oot. 

1 

Oct. 

3 

Oct. 

3 

Oct. 

3 

Nov. 

15 

Nov. 

15 

Dec. 

15 

1961 

Feb. 

15 

Mar. 

15 

Mar. 

15 

Apr. 

1 

May 

15 

May  15 

1960 

July 

13 

July 

15 

Oct. 

17 

Oct. 

21 

1961 

Jan. 

15 

Apr. 

3 

Apr. 

15 

June 

14 

Bonds,  Notes,  and  Certificates  of 
Indebtedness 


m%  exchange  note— Apr.  1, 1965  > 

3H%  certificate— Aug.  1,  19fil  3 

3%%  bond— May  15,  1968  additional  3 

1]^%  exchange  note— Oct.  1, 1965  i 

3H%  bond— Nov.  15,  1980 

3K'%  bond— Feb.  15,  1990  additional 

31^%  bond— Nov.  15,  1998 

3H%  note— Feb.  15,  1962... 

3%%  bond— May  15,  1966,. 

4%  bond— Oct.  1,  1969  additional  at  100J.4. 


2,078 
1,042 


2  408 

5,751 

28 

315 


314%  note— Aug.  15,  1962  3 

Z%%  bond— Nov.  15,  196G.... 

3%%  bond— Nov.  15,  1967 

lVi%  exchange  note— Apr.  1,  1966  '. 

3%  certificate- May  15,  1962  « 

ZVi%  note— May  15,  1963  a... 


3,268 


9,098 
1,213 
M48 


3,670 


643 

993 

2,343 


2,438 
3,604 


6  337 
6  172 


3,391 
1,731 


1,781 
850 


Total  bonds,  notes,  and  certificates 

Bills  '  (Maturity  Value) 

2.823%  252-day  (tax  anticipation)  Mar.  22,  1961. 
3.265%  1  ST.- July  15,  1961 

3.131%  1  yr.— Oct.  16,  1961 

2.788%  8  mo.  (tax  anticipation)  June  22, 1961-.. 


11,510 


23,  331 


10, 021 


3,512 


3,504 


1,380 
1,486 


121 

16 


2.679%  1  yr  — Jan.  15,  1962 

2.473%  172-day  (tax  anticipation)  Sept.  22,  1961 

2.827%  1  yr.— Apr.  15,  1962 

2.308%  109.6  day  average  for  "strip"? 

Increases  in  regular  weekly  bill  offerings: 

Jan.  19,  1961  through  Feb.  2,  1961.. 500 

Mar.  30,  1961  through  Apr.  13,  1961 298 

May  4,  1961  through  May  11,  1961 201 


Total  bills 

Total  public  offerings. 


1,503 


1,410 


1,814 


92 

"m 


1,802 


999 


11,320 
12, 216 


6,090 
17, 600 


415 
23,  746 


10, 021 


7,829 

1,070 

315 

643 

993 

2,343 

9,098 

1,213 

148 


7,325 
2,438 
3.604 
^^69. 
5,509 
2,753 


45,  758 


3,512 
1,501 
1,502 
3,504 


1,502 
1,503 
2,000 
1,802 


17, 825 
63,  583 


1  Issued  only  on  demand  in  exchange  for  2%%  Treasury  Bonds,  Investment  Series  B-1975-80. 

'  Issued  subsequent  to  June  30,  1960. 

3  A  cash  offering  (all  subscriptions  subject  to  allotment)  was  made  for  the  purpose  of  paying  off  the  matur- 
ing securities  in  cash.  Holders  of  the  maturing  securities  were  permitted  to  present  them  in  payment  in 
lieu  of  cash  to  the  extent  subscriptions  were  allotted.    For  further  detail  see  exhibits  1-3. 

■•  Includes  about  .$362,000  cash  payment  on  exchange  of  Series  F  and  G  savings  bonds. 

6  Prorated  on  the  basis  of  total  amount  of  each  security  issued  for  cash. 

0  Treasury  bills  are  sold  on  a  discount  basis  with  competitive  bids  for  each  issue.  The  average  price  for 
auctioned  issues  gives  an  approximate  yield  on  a  bank  discount  basis  as  indicated  for  each  series. 

'  Consists  of  additional  amounts  of  eighteen  series  of  outstanding  regular  weekly  Treasury  bills,  approxi- 
mately $100  million  maturing  each  week  from  August  3  to  November  30,  1961,  inclusive. 


94 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Disposition  of  marketable  Treasury  securities  excluding  regular  weekly  bills,  fiscal  year 

1961 

[In  millions  of  dollars] 


Date  of 
refund- 
ing or 
retire- 
ment 


Security 


Description  and  maturity  date 


Issue  date 


Redeemed 
for  cash  or 
carried  to 
matured 
debt 


Exchanged  for 
new  security 


At  ma- 
turity 


In  ad- 
vance 
refund 
ing 


Total 


1960 

Au?. 

15 

Oct. 

1 

Oct. 

.■? 

Oct. 

3 

Oct. 

3 

Oct. 

3 

Nov. 

15 

Nov. 

15 

1961 

Feb. 

lo 

Mar. 

15 

Mar. 

15 

Mar. 

15 

Mar. 

15 

Apr. 

1 

May 

15 

May 

15 

June 

1 

1960 

July 

15 

Oct. 

17 

1961 

Jan. 

15 

Mar. 

22 

Apr. 

15 

June 

22 

Bonds,  Notes,  and  Certificates  of 
Indebtedness 

4%%  note— Aug.  15,  1960 

11.^%  exchange  note— Oct  1,  1960 

2!-^%  bond— June  15,  19^2-67 

2H%  bond— Dec.  15,  1963-68 

2}-<;%  bond— June  15,  1964-69 

2V>%  bond— Dec.  15,  1964-69 

m%  certificate- Nov.  15,  1960 

2\i%  bond— Nov.  15.  1960 

4^4%  certificate— Feb.  15,  1961— 

21.4%  bond— June  15,  1959-62 

2M%  bond— Dec.  15,  1959-62. 

■2%%  note— Feb.  15,  1963 

2H%  bond— Aug.  15.  1963 

IJ'4%  exchange  note— Apr.  1,  1961 

4?^%  certificate— May  15,  1961. 

3%%  note— May  15,  1961 

3%  bond— June  1,  1961  (Panama  Canal 
loan) 

Total  bonds,  notes,  and  certificates. 

Bills 


4.728%— July  15,  1960. 
4.860%— Oct.  17,  1960- 


Aug.  1, 1959 

Oct.  1, 1955 

May  5, 1942 

Doc.  1, 1942 

Apr.  15,1943 

Sept.  15, 1943 

Nov.  15,  1959 

Aug.  15,1954 


Feb. 
June 
Nov. 
.\pr. 
Dec. 
Apr. 
May 
Dec. 


15, 1960 

1,  1945 

15, 1945 

15, 1958 

15, 1954 

1,  1956 

15, 1960 

1, 1958 


June     1, 1911 


5.067%— Jan.  15,  1961 

2.823%  (tax  anticipation)  Mar.  22,  1961.. 
4.608%— Apr.  15,  1961.. 

2.788%  (tax  anticipation)  June  22,  1961.. 


Total  bills. 

Total  securities. 


July    15,1959 
Dec      2, 1959 


.Tan.  15,1960 

July  13, 1960 

Apr.  15,  1960 

Oct.  21,1960 


3,781 
278 


1  5,  780 


643 

993 

1,095 

1,248 


271 
262 


3,268 


6,766 
3,544 


3,670 


144 
3,599 
1,523 

50 


1,293 
1,180 
1,131 
2,438 


175 
1  2,  555 


13, 176 


1,880 
1,991 


1,412 
23,512 

1,815 
«  3,  504 


22, 390 


1  121 
116 


10,021 


1  186 


14, 114 
27,  290 


415 

22,  805 


10, 021 


9,561 

278 

643 

993 

1,095 

1,248 

7,037 

3,806 


6,938 
1,293 
1,180 
1,131 
2,438 
141 
3,674 
4,078 


50 


45, 587 


2,001 
2,007 


1,504 
3,512 
2,001 
3,504 


14,529 
60,016 


Accepted  in  payment  in  lieu  of  cash. 

Including  tax  anticipation  issues  redeemed  for  taxes. 


REVIEW    OF    FISCAL    OPERATIONS 


95 


Allotments  of  marketable  Treasury  securities  other  than  regular  weekly  bills,  fiscal 

year  1961  i 

[In  millions  of  dollars] 


Date  of 
financ- 
ing 


Issue— description  of  security  and 
maturity  date 


Amount 
issued 


Allotments  by  investor  classes 


U.S.  Gov- 
ernment 
investment 
accounts 

and 
Federal 
Reserve 
Banks 


Commer- 
cial banks  2 


All  others 


1960 

Aug. 

15 

Aug 

15 

Oct. 

H 

Oct. 

3 

Oct. 

3 

Nov. 

15 

Nov. 

15 

Dec. 

15 

1961 

Feb. 

15 

Mar. 

15 

Mar. 

15 

May 

15 

May  15 

1980 

Julv 

13 

July 

15 

Oct. 

17 

Oct. 

21 

1981 

Jan. 

15 

Apr. 

3 

Apr. 

15 

June 

14 

Bonds,  Notes,  and  Certificates  of 
i.\debtedness 

3'/i%  certificate— Aug.  1,  1961-C 

3j^%  bond— May  15,  1968  additional 

3H%  bond— Nov.  15,  1980.-. - 

31^%  bond— Feb.  15,  1990  additional 

Zh%  bond— Nov.  15,  1998.- - — 

ZH%  note— Feb.  15,  1962-F. 

3M%  bond— May  15,  1966 — . 

4%  bond— Oct.  1, 1969  additional.. 

3M%  note— Aug.  15,  1962-G 

3%%  bond— Nov.  15,  1966 

3^%  bond— Nov.  15,  1967 

3%  certificate- May  15,  1962-A 

3H%  note— May  15,  1963-D 

Bills 

2.823%  (tax  anticipation)- Mar.  22,  1961... 

3.265%— July  15,  1961 

3.131%— Oct.  10,  1961. 

2.788%  (tax  anticipation)— June  22, 1961... 

2.679%— Jan.  15,  1962. 

2.473%  (tax  anticipation)— Sept.  22,  1961... 

2.827%— Apr.  15,  1962 

2.308%- "strip"  3 


7,829 

1,070 

643 

993 

2,343 

9,098 

1,213 

148 


7,  325 
2,438 
3,604 

5,509 
2,753 


3,  512 
1,501 
1,502 
3,504 


1,502 
1,  503 
2,000 
1,802 


5,541 

25 

131 

216 

236 

5,102 

6 

(*) 


3,605 
39 
560 

1,818 
837 


236 

S2 


203 
"§26' 


797 
544 


54 
117 


821 
2 


1,518 
1,714 
1,664 
2,004 
907 


3,476 
612 
723 

3,463 


651 
1,492 


1,792 


1,491 
501 
416 
723 
1,990 
2,298 
386 
146 


2,202 
685 
1,380 
1,687 
1,009 


36 
653 
697 

41 


648 
11 

778 
10 


•  Less  than  $500,000. 

1  Excludes  1!'2%  Treasury  EA  and  EO  notes  issued  in  exchange  for  nonmarkctable  2%%  Treasury  Bonds 
Investment  Series  B-1975-80. 

2  Includes  trust  companies  and  stock  savings  banks. 

3  Consists  of  additional  amounts  of  eighteen  series  of  outstanding  regular  weekly  Treasury  bills,  approxi- 
mately $100  million  maturing  each  week  from  August  3  to  November  30, 1961,  inclusive. 


96     1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Seasonal  and  other  cash  borrowing  during  the  first  half  of  the  fiscal 
year  brought  the  pubhc  debt  up  to  levels  not  far  from  the  temporary 
ceiling  of  $293  bilhon.  The  peak  of  $291.0  billion  for  the  first  half  year 
was  reached  on  October  24,  1960.  In  the  second  half  of  the  fiscal 
year  the  debt  subject  to  limitation  rose  to  a  new  peak  of  $291.7  billion 
on  June  14,  1961.  On  June  30,  1961,  a  temporary  increase  of 
$13  billion  was  authorized  for  the  fiscal  year  1962,  bringing  the  total 
authorization  for  the  new  fiscal  year  up  to  $298  billion.  For  further 
detail  on  the  statutory  limit  on  the  public  debt  and  guaranteed  obliga- 
tions as  of  June  30,  1961,  see  table  33,  and  for  a  summary  of  amend- 
ments to  the  law  limiting  the  debt  see  table  34. 

The  decline  of  $1.0  billion  in  interest-bearing  public  nonmarketable 
securities  during  the  year  was  due  principally  to  the  reduction  in 
Series  B  investment  bonds  as  a  result  of  exchanges  of  these  securities 
for  marketable  5-year  1%  percent  exchange  notes.  In  addition,  the 
Postal  Savings  System  redeemed  $0.1  billion  Series  B  investment  bonds 
at  par  to  provide  funds  to  meet  withdrawals  of  postal  savings  deposits. 

Beginning  on  July  1,  1960,  the  Treasur}^  made  available  exclusively 
to  borrowers  from  the  Kural  Electrification  Administration  an  issue 
of  bonds  to  yield  2  percent  per  annum.  This  arrangement  provides 
REA  borrowers  with  a  means  for  investing  their  general  cash  funds 
not  needed  for  immediate  operating  purposes  at  a  rate  of  interest 
equal  to  that  charged  by  the  Government  on  REA  loans.  The  bonds, 
which  may  be  purchased  to  the  extent  the  individual  borrower  wishes, 
have  a  12-year  maturity  but  may  be  redeemed  by  the  holder  in  whole 
or  in  part  on  30  days'  notice.  On  June  30,  1961,  REA  series  bonds 
were  outstanding  in  the  amount  of  $19  million. 

The  largest  portion  of  the  public  nonmarketable  debt  is  in  U.S. 
savings  bonds,  which  are  demand  securities  redeemable  at  guaranteed 
redemption  values.  Although  savings  bonds  of  various  series  have 
been  continuously  on  sale  since  March  1935,  Series  E  and  Series  H 
are  the  only  savings  bonds  currentl}^  being  sold.  These  series  were 
outstanding  on  June  30,  1961,  in  the  amount  of  $43.8  billion,  represent- 
ing 15  percent  of  the  total  interest-bearing  debt.  This  was  an  increase 
of  $1.1  billion  for  the  3'ear,  the  largest  annual  increase  in  Series  E 
and  H  bonds  outstanding  since  1956.  Series  F,  G,  J,  and  K  bonds, 
which  are  no  longer  being  sold,  decreased  by  $1.1  billion  during  the 
year.  This  decline  includes  the  exchange  of  $0.1  billion  of  Series  F 
and  G  bonds  maturing  in  the  calendar  year  1961  for  the  4  percent 
marketable  bond  of  1969.  The  total  interest-bearing  savings  bonds 
outstanding  of  all  series  at  the  close  of  fiscal  1961  was  $47,5  billion, 
approximately  the  amount  of  a  year  earlier. 


REVIEW    OF   FISCAL    OPERATIONS 


97 


Class  of  security 

June  30,1960 

June  30,1961 

Increase, 

or  de- 
crease (— ) 

In  billions  of  dollars 

United  States  savings  bonds: 

Series  E ... 

37.5 
5.3 

37.8 
6.0 

.4 

Series  H                  

.7 

Subtotal  E  and  H 

42.7 
2.8 
2.0 

43.8 
1.8 
1.9 

1.1 

Series  F  and  G 

-1.0 

Series  J  and  K . 

— .  1 

Subtotal  savings  bonds 

Treasury  bonds: 

47.5 

47.5 

5.8 
.1 

(*) 

—  1.0 

Investment  series 

6.8 
.2 

Depositary  bonds.. _      

— .  1 

Total  interest-bearing  public  nonmarketable  issues 

54.5 

53.5 

-1.0 

*Less  than  $50  million. 

In  March  1961,  the  Secretary  of  the  Treasury  announced  a  second 
ten-year  extension  for  Series  E  bonds  issued  between  May  1941  and 
May  1949.  Beginning  May  1,  1961,  as  these  bonds  enter  their 
second  extended  maturity  they  earn  a  straight  3%  percent  interest  per 
annum,  compounded  semiannually.  Details  of  this  new  regulation 
may  be  found  on  pages  274-292. 

Sales  of  the  smaller  denomination  E  bonds  ($200  and  under)  in 
fiscal  1961  were  approximately  1  percent  above  those  of  fiscal  1960, 
while  sales  of  the  larger  denomination  E  and  H  bonds  were  up  8  per- 
cent from  last  year.  Detailed  information  on  savings  bonds  from 
theh  inception  on  March  1,  1935,  through  June  30,  1961,  is  given  in 
tables  43  through  46. 

OWNERSHIP  OF  FEDERAL  SECURITIES 

Private  nonbank  investors  held  an  estimated  $143.3  billion  of 
Federal  securities  at  the  end  of  fiscal  1961,  almost  one-half  of  the 
$289.2  billion  total  Federal  debt  outstanding.  Private  nonbank 
investors  comprise  individuals  (including  partnerships  and  personal 
trust  accounts),  insurance  companies,  mutual  savings  banks,  savings 
and  loan  associations,  nonfinancial  corporations,  pension  funds,  for- 
eign and  international  accounts,  State  and  local  governments,  and 
nonprofit  associations.  Commercial  banks  and  Federal  Reserve 
Banks  together  held  $89.8  billion,  representing  nearly  one-third  of 
the  debt.  The  remaining  $56.1  billion  of  debt  was  held  b^^  Govern- 
ment investment  accounts,  primarily  in  social  security  and  unemploy- 
ment trust  funds,  veterans'  insurance  funds,  and  Government  retire- 
ment funds.     These  figures  are  graphically  presented  in  chart  9. 

During  fiscal  1961  the  total  public  debt  outstanding  increased  $2.7 
billion.  The  banking  system  increased  its  holdings  by  $8.0  billion 
while  private  nonbank  investors  decreased  their  holdings  by  $6.0 
billion.  Government  investment  accounts  rose  by  $0.8  billion. 
Ownership  of  Federal  securities  by  investor  classes  on  selected  dates 
is  presented  in  the  following  table. 


98 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Ownership  of  Federal  securities  ^  by  investor  classes  on  selected  dates,  1941-61 

[Dollars  in  billions] 


June  30, 
1941 

Feb.  28, 
1946  2 

June  30, 
1960 

June  30, 
1961 

Change 
during  fis- 
cal year 
1961 

Estimated  ownership  by: 

Private  nmibank  investors: 

$11.2 

7.1 

3.4 

2.0 

.6 

.7 

$64.1 
24.4 
11.1 
19.9 
6.7 
8.9 

'  $68.  4 
'12.0 
6.6 
'20.7 
'18.8 
'22.7 

$64.3 
11.4 
6.3 
19.4 
18.7 
23.2 

$-4.1 

-.6 

-.3 

-1.3 

State  and  local  governments         ..    

-.  1 

Miscellaneous  investors'  

.5 

Total  private  nonbank  investors  .. 

25.0 
8.5 

19.7 
2.2 

135.1 
28.0 
93.8 
22.9 

'  149.  3 

55.3 

'55.3 

26.5 

143.3 
56.1 
62.5 
27.3 

-6.0 

Federal  Government  investment  accounts 

.8 
7.2 

.7 

55.3 

279.8 

286.5 

289.2 

2.7 

Percent  of  total 

Percent  owned  by: 

Private  nonbank  investors: 

20 
25 

23 

25 

24 
28 

22 
28 

Other  .            

Total                                         -- 

45 
15 
36 

4 

48 
10 
34 

8 

52 

'20 

'19 

9 

50 

19 

22 

9 

100 

100 

100 

100 

'  Revised. 

I  Gross  public  debt,  and  guaranteed  obligations  of  the  Federal  Government  held  outside  the  Treasury. 

'  Immediate  postwar  peak  of  debt. 

» Includes  partnerships  and  personal  trust  accounts.  Nonprofit  institutions  and  corporate  pension  trust 
funds  arc  included  under  "Miscellaneous  investors." 

*  Exclusive  of  banks  and  insurance  companies. 

» Includes  savings  and  loan  associations,  nonprofit  institutions,  corporate  pension  trust  funds,  dealers 
and  brokers,  and  investments  of  foreign  balances  and  international  accounts  in  this  coimtry. 

Within  the  nonbank  sector,  individuals  decreased  their  holdings 
of  Federal  securities  by  $4.1  billion,  from  $68.4  billion  in  June  19G0 
to  $64.3  billion  in  June  1961;  however,  they  still  remained  the  largest 
single  investor  group  in  the  Federal  debt  ownership  structure. 

Individuals  increased  their  holdings  of  Series  E  and  H  savings 
bonds  (the  only  series  currently  being  sold)  by  $1.0  billion  during 
fiscal  1961,  to  an  alltime  high  level  of  $43.6  billion  which  represented 
two-thirds  of  the  total  o^vnership  of  Federal  securities  by  individuals. 
Their  holdings  of  the  discontinued  Series  F,  G,  J,  and  K  savings 
bonds  declined  b}^  $0.6  bilhon  during  the  fiscal  je^r  1961,  and  holdings 
of  other  Government  securities,  mainly  marketable  issues,  were 
reduced  by  $4.6  billion.  Many  individual  investors  were  less  at- 
tracted to  marketable  Government  securities  during  the  fiscal  j^ear 
as  new  issue  coupon  rates  receded  from  the  high  levels  of  fiscal  year 
1960  and  as  investment  interest  focused  upon  other  outlets  for  funds. 

Federal  securities  held  by  insurance  companies  on  June  30,  1961, 
totaled  $11.4  billion,  a  decrease  of  $0.6  billion  during  the  year. 


REVIEW    OF    FISCAL    OPERATIONS 
Chart  9 

OWNERSHIP  OF  THE  PUBLIC  DEBT,  JUNE  30,1961 


99 


TOTAL 


Gov't.  Invest. 
Accounts 


Nonbank  Investors 


Banks 


$Bil. 


200- 


100 


".56/ 


^  ^Individuals 

^y  ^  Savings 

'yy//^.        ^  Inslifutions 
///////A  * 


Another 


I  Coml 

Federal 
^  Reserve 


Life  insurance  companies  owned  $6.3  billion,  or  55  percent,  of  the 
total  insiu'ance  holdings  of  Federal  secm^ities  at  the  end  of  the  fiscal 
year.  The  life  insurance  group  accounted  for  a  $0.3  billion  decrease 
in  insurance  companies'  holdings,  and  almost  all  of  this  decrease  was 
in  the  nonmarketable  Series  B  investment  bonds  (exchanged  for 
marketable  IK  percent  exchange  notes  which,  in  turn,  were  sold  in 
the  market).  The  average  length^  of  life  insurance  holdings  of  market- 
able securities  increased  from  12  years  3  months  to  16  years  7  months. 
This  was  an  increase  of  4  years  4  months  over  the  12-month  period 
in  contrast  to  a  decline  of  2  months  during  the  previous  fiscal  year. 
This  sharp  reversal  was  primarily  due  to  the  exchange  of  $0.9  billion 
of  2)''i  percent  bonds,  issued  during  World  War  II,  and  now  approach- 
ing matmity,  for  long-term  3K  percent  bonds  in  the  advance  refund- 
ing of  October  1960. 

Fire,  casualty,  and  marine  insurance  companies  decreased  their 
holdings  of  marketable  securities  during  the  year  by  $0.3  billion  and 
their  nonmarketables  by  $0.1  billion.  The  drop  in  nonmarketables 
was  attributed  to  the  liquidation  of  savings  bonds  holdings  as  well 
as  Series  B  investment  bonds.  The  average  length  of  the  marketable 
securities  held  by  this  group  at  the  end  of  fiscal  1961  was  5  years  9 
months,   a  drop  of  2  months  during  the  year. 

'  In  deriving  average  length  figures  all  marketable  securities  are  classified  to  final  maturity,  except  par- 
tially tax-exempt  bonds  vi^hich  are  classified  to  earliest  call  date. 


100    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

At  the  end  of  fiscal  1961  mutual  savings  banks  held  $6.3  billion  of 
Federal  securities,  $0.3  billion  less  than  on  June  30,  1960.  The  great- 
est portion  of  this  reduction,  or  $0.2  billion,  was  in  the  marketable 
area.  However,  the  average  length  of  marketable  securities  held 
by  mutual  savings  banks  increased  20  months  dm-ing  the  fiscal  year 
from  8  years  10  months  to  10  years  6  months.  Savings  banks  also 
participated  strongly  in  the  advance  refunding  of  October  1960, 
taking  $0.8  billion  of  the  new  long-term  issues. 

Federal  secm'ities  held  by  nonfinancial  corporations  were  $1.3 
billion  lower  at  the  end  of  fiscal  1961  than  the  $20.7  billion  held  on 
June  30,  1960.  Corporations  continued  to  hold  relatively  large 
amounts  of  Governments  during  the  year  and  did  not  hquidate 
sharply  as  in  the  1958  recession. 

Holdings  of  Federal  securities  by  State  and  local  governments  are 
estimated  to  be  $18.7  billion  at  the  close  of  the  fiscal  year,  a  level 
$0.1  bilhon  lower  than  that  of  Jime  1960.  Over  one-third  of  the 
Federal  security  holdings  of  these  State  and  local  governmental  units 
are  in  employee  retirement  funds.  In  July  1960  the  Treasmy  De- 
partment added  a  number  of  the  larger  State  and  local  governments 
to  the  regular  monthly  Survey  of  Ownership  of  U.S.  Government 
Securities.  Tabulations  of  these  holdings  were  published  with  the 
other  survey  groups  in  the  February  1962  Treasury  Bulletin. 

The  holdings  of  all  other  private  nonbank  investors  amounted  to 
$23.2  billion  on  June  30,  1961,  an  increase  of  $0.5  billion.  Foreign 
balances  invested  in  Federal  securities  decreased  $0.3  billion  to  a 
level  of  $8.1  billion  on  June  30,  1961.  International  institutions 
increased  theu'  holdings  by  $0.7  billion  as  the  International  Monetary 
Fund  acquii'ed  $0.3  billion  of  marketable  Treasmy  secmities  and 
$0.3  billion  of  special  notes,  and  the  International  Development 
Association  acquu-ed  $0.1  billion  of  securities. 

Savings  and  loan  associations  increased  their  holdings  of  Federal 
securities  during  the  fiscal  year  by  $0.4  billion.  On  Jmie  30,  1961, 
marketable  securities  of  approxuuately  500  large  savings  and  loan 
associations  had  an  average  length  of  8  years  11  months,  an  increase 
of  3  months  over  the  June  30,  1960,  amount. 

Holdings  of  the  remaining  classes  in  this  group  of  private  nonbank 
investors  (nonprofit  associations,  dealers  and  brokers,  corporate 
pension  funds,  and  certain  smaller  institutional  groups)  are  estimated 
to  have  decreased  $0.2  billion  during  the  fiscal  ^^ear. 

Government  investment  accounts  increased  then*  holdings  of  Federal 
securities  by  $0.8  billion.  The  largest  increases  in  holdings  were 
registered  by  Government  employee  retu-ement  funds  ($1.1  billion), 
the  Federal  disability  insurance  trust  fund  ($0.3  billion),  and  the 
highway  trust  fund  ($0.2  billion).     Offsetting  reductions  in  holdings 


REVIEW    OF    FISCAL    OPERATIONS 


101 


were  made  by  the  unemployment  trust  fund  ($0.9  billion),  and  the 
Federal  old-age  and  survivors  insurance  trust  fund  ($0.2  biUion).  Of 
the  $56.1  billion  Federal  securities  held  by  Government  investment  ac- 
counts on  June  30,  1961,  $45.0  billion,  or  more  than  80  percent,  was  in 
the  form  of  special  issues  held  only  by  these  accounts.  Details  on  the 
ownership  by  Government  investment  accounts  are  shown  in  tables 
64-88. 

The  change  in  holdings  of  the  banking  system  during  the  fiscal  year 
consisted  of  an  increase  of  $7.2  billion  in  commercial  bank  holdings 
and  a  $0.7  billion  increase  on  the  part  of  the  Federal  Reserve  System. 

The  commercial  bank  change  consisted  of  a  $7.4  billion  increase  in 
holdings  of  marketable  securities  and  a  $0.2  billion  decline  in  non- 
marketables.  Of  the  commercial  bank  increased  holdings,  New  York 
City  central  reserve  city  banks  accounted  for  $2.2  billion,  Chicago 
central  reserve  city  banks  $0.4  bilhon,  reserve  city  banks  $3.0  billion, 
and  country  and  nonmember  banks  $1.6  bilhon.  The  average  length 
of  marketable  securities  held  by  commercial  banks  on  June  30,  1961, 
was  2  years  9  months,  a  decrease  of  11  months  from  that  as  of  June  30, 
1960. 

An  analysis  of  the  estimated  changes  during  fiscal  1961  in  bank 
versus  nonbank  ownership  is  given  by  type  of  issue  in  the  following 
table.  A  summary  of  the  Treasury  survey  of  ownership  of  the 
interest-bearing  public  debt  and  guaranteed  obligations  for  fiscal  1961 
is  shown  in  table  55. 


Estimated  changes  in  ownership  of  Federal  securities 

[In  billions  of  dollars] 

>  1  Uj  typ 

e  of  issue 

,  fiscal  year  1961 

Total 
changes 

Change  accounted  for  by- 

Private 
nonbank 
investors 

Govern- 
ment in- 
vestment 
accounts 

Commer- 
cial 
banks 

Federal 
Reserve 
Banks 

Marketable  securities: 
Treasury  bills: 

13-week .... 

1.7 

1.1 

1.5 

-1.0 

-1.0 

.1 

1.2 

-2.1 

-.1 
.1 

(•) 
.4 

2.4 
.9 
.3 

.  7 

4 

26- week 

(*) 

Tax  anticipation 

(*) 

Other  Treasury  bills _ 

— .  1 

Total  bills 

3.3 
-4.3 

4.8 
-.4 

-1.8 
-3.3 

.7 
-1.0 

.4 
-.2 
-.6 
1.1 

4.4 

1.2 

3.0 

-1.2 

.3 

Treasury  certificates  of  indebtedness 

-2.0 

Treasury  notes.. 

1.6 

Treasury  bonds,  etc 

.8 

Total  marketable .. 

3.4 

-5.5 

.7 

7.4 

.7 

Nonmarketable  securities,  etc.: 

U.S.  savings  bonds.. 

.1 

-1.0 
.2 

.1 

.1 
-.1 

-.1 

Special  issues  to  Goverrmient  investment  ac- 
counts  

Treasury  bonds,  investment  series 

-.8 
.2 

(*) 
-.1 

other 

Total  nonmarketable,  etc 

-.7 

-.5 

(*) 

-.2 

Total  change 

2.7 

-6.0 

.8 

7.2 

.7 

•  Less  than  .$50  million. 

'  Gross  public  debt,  and  guaranteed  obligations  of  the  Federal  Qovenunent  held  outside  the  Treasury, 


102   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Taxation  Developments 

Major  taxation  developments  during  the  year  included:  Consider- 
ation by  the  Committee  on  Ways  and  Means  of  the  House  of  Repre- 
sentatives of  the  proposals  in  the  President's  tax  message  of  April  20, 
1961,  for  an  investment  credit  to  improve  the  competitive  status  of 
American  industry  and  for  the  elimination  of  certain  defects  in  the 
tax  system;  revision  of  the  social  security  system  to  meet  problems 
caused  by  the  high  level  of  unemployment  and  the  inadequacy  of 
benefit  levels;  securing  of  additional  tax  revenues  to  finance  comple- 
tion of  the  interstate  highway  system;  and  work  on  administrative 
revision  of  depreciation  schedules. 

Presidential  tax  recommendations 

The  President's  tax  message  (exhibit  12)  proposed  a  credit  against 
income  tax  for  investment  in  new  plant  and  equipment.  Specifically, 
the  credit  would  be  15  percent  of  all  new  plant  and  equipment  ex- 
penditures in  excess  of  current  depreciation  allowances;  6  percent  of 
such  expenditures  in  excess  of  50  percent,  but  not  over  100  percent, 
of  depreciation  allowances;  with  10  percent  of  the  first  $5,000  of  new 
investment  as  a  minimum  credit.  The  investment^  credit  was 
proposed  to  encourage  investment  in  capital  equipment  needed  to 
accelerate  economic  growth  and  to  make  American  industry  more 
effective  in  competing  in  international  markets.  Measures  to  correct 
certain  defects  and  inequities  in  the  tax  structure  also  were  recom- 
mended. These  changes  would  provide  revenue  gains  to  offset  the  tax 
reduction  involved  in  the  investment  credit. 

These  suggestions  were  advanced  only  as  a  first  step  toward  tax 
reform.  The  President  also  directed  the  Secretary  of  the  Treasury 
to  undertake  the  research  and  preparation  of  a  comprehensive  tax 
program  to  be  placed  before  the  next  session  of  the  Congress.  The 
aim  of  this  program  is  to  provide  a  broader  and  more  uniform  tax 
base,  a  more  equitable  tax  structure,  and  a  simpler  tax  law. 

The  President's  immediate  suggestions  for  correction  of  defects  in- 
cluded :  Revisions  in  the  tax  provisions  with,  respect  to  foreign  income 
which  favor  U.S.  private  investment  abroad  compared  with  invest- 
ment in  our  economy;  withholding  of  income  tax  on  dividend  and  in- 


REVIEW    OF    FISCAL    OPERATIONS  103 

terest  income;  repeal  of  the  dividend  credit  and  exclusion;  limitations 
on  business  expense  deductions  for  travel,  entertainment,  and  gifts; 
withdrawal  of  capital  gains  tax  treatment  on  the  sale  of  depreciable 
property  to  the  extent  of  depreciation  taken;  legislation  to  assure  the 
current  taxation  of  the  income  of  cooperatives  at  either  the  coopera- 
tive or  patron  level;  and  taxation  of  mutual  fire  and  casualty  insur- 
ance companies  on  a  basis  similar  to  stock  companies.  With  the  aim 
of  assuring  nondiscriminatory  treatment,  a  review  was  recommended 
also  of  the  provision  allowing  mutual  savings  banks  and  savings  and 
loan  associations  an  income  tax  deduction  for  bad  debt  reserves. 

Tax  administration  features  of  the  tax  message  included  a  request 
for  legislation  to  authorize  the  use  of  taxpayer  account  numbers  to 
facilitate  the  growing  task  of  tax  collection  and  enforcement  falling 
upon  the  Internal  Revenue  Service.  The  President  also  reiterated  a 
previous  request  for  additional  tax  personnel  while  pointing  out  that, 
among  other  things,  he  had  directed  the  Internal  Revenue  Service  to 
increase  emphasis  on  reviewing  taxpayers'  inventory  accounts  be- 
cause manipulation  of  inventories  had  become  a  frequent  method  of 
avoiding  taxes. 

In  addition  the  President  pointed  out  that  Government  revenue 
needs  required  extension  of  corporation  income  and  excise  tax  rates 
otherwise  scheduled  for  reduction  or  termination  on  July  1,  1961. 
Finally,  he  recommended  that  all  aviation  fuel  be  taxed  to  recover 
from  civil  aviation  a  share  of  the  costs  of  the  Federal  airways  system. 
This  tax  proposal  involved  extension  of  the  current  2-cents  per  gallon 
rate  on  aviation  gasoline  to  jet  fuels  for  fiscal  1902,  and  thereafter  an 
annual  increment  of  tax  of  one-half  cent  a  gallon. 

Legislation  to  carry  out  the  President's  recommendation  for  the 
extension  of  the  corporate  income  and  certain  excise  tax  rates  beyond 
their  scheduled  expiration  dates  was  embodied  in  Public  Law  87-72, 
approved  June  30,  1961.  The  law  continues  for  one  year,  until  July  1, 
1962,  the  52  percent  corporate  income  tax  rate  and  the  present  rates 
of  excise  tax  on  distilled  spirits,  beer,  wine,  cigarettes,  passenger  cars, 
automobile  parts  and  accessories,  on  general  telephone  service,  and  the 
transportation  of  persons.  The  effect  of  this  legislation  on  the 
Government's  revenues  is  shown  in  detail  in  the  following  table. 


104   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Estimated  net  increase  in  revenue  *  resulting  from  extension  of  present  corporation 
income  and  excise  tax  rates  for  one  year  beyond  June  30,  1961 

[In  millions  of  dollars] 


Scheduled  rate 
reduction 

Increase  in  receipts 

Tax 

Fiscal  year 

Full  year 

Decrease 
in  refunds 
(1962  only ) 

1962 

1963 

52%  to  47% 

$1,000 

170 
76 
9 

'$1,000 

3 

1 

$2,000 

173 

77 
9 

Excise  taxes: 
Alcohol: 

$10.50  to  $9.00  per 

gallon. 
$9.00  to  $8.00  per 

barrel. 
Various  '^ 

130 

Beer     

8 

5 

Total  alcohol  taxes. - 

255 
230 

334 
66 

4 
4 

73 
13 

259 
234 

407 
79 

143 

Tobacco: 

Cigarettes  (small) _-. 

$4.00  to  $3.50  per 
thousand. 

10%  to  7%  of  manu- 
facturers'  price. 

8%  to  5%  of  manu- 
facturers' price. 

10%,  repeal  July  1, 

1961. 
10%  to  5% 

23 

Manufacturers'  excise  taxes: 
Passenger  automobiles 

60 

automobiles. 

Total  manufacturers'  ex- 
cise taxes. 
Miscellaneous  excise  taxes: 

General  telephone  service 

Transportation  of  persons — 

400 

366 
116 

86 

119 
25 

486 

485 
141 

60 

482 

144 

626 

Total  excise  taxes 

1,367 

238 

1,605 

226 

2,367 

1,238 

3,605 

226 

1  At  levels  of  income  estimated  for  the  calendar  year  1961  and  fiscal  year  1962. 
'  Includes  small  receipts  in  succeeding  years. 

3  Sparkling  wines  (champagne) $3.40  to  $3.00  per  gallon. 

Artificially  carbonated  wines $2.40  to  $2.00  per  gallon. 

Still  wines: 

Not  more  than  14%  alcohol 17  cents  to  15  cents  per  gallon. 

More  than  14%,  not  over  21%  alcohol. 67  cents  to  60  cents  per  gallon. 

More  than  21%,  not  over  24%  abohol $2.25  to  $2.00  per  gallon. 

Wine  liqueurs  or  cordials  produced  domestically  containing  over  2Vi% 
wine,  which  wine  contains  over  14%  alcohol  (in  lieu  of  rectification 
tax) --. - $1.92  to  $1.60  per  gallon. 


No  action  was  taken  by  the  Congress  on  the  President's  proposal 
for  a  tax  on  aviation  fuel,  but  the  Committee  on  Ways  and  Means 
directed  the  interested  executive  departments  to  make  a  study  of  the 
consequences  of  the  aviation  fuel  tax  proposal  for  the  airlines  industiy 
and  also  of  the  impact  of  the  transportation  of  persons  tax  on  the 
transportation  industries  affected  by  it.  This  study  was  later  con- 
solidated into  a  broader  re^aew  of  the  transportation  situation  which 
the  President  asked  the  Secretary  of  Commerce  to  undertake. 

The  President's  investment  credit  proposal  and  recommendations 
to  eliminate  defects  and  inequities,  except  with  respect  to  mutual 
savings  banks  and  savings  and  loan  associations,  were  amplified  and 
supported  by  Secretary  of  the  Treasury  Dillon  before  the  Committee 
on  Ways  and  Means  of  the  House  on  May  3,  4,  and  5,  1961.     On 


REVIEW    OF    FISCAL    OPERATIONS  105 

July  14,  1961,  Secretary  Dillon  sent  to  the  committee  a  report  on  the 
taxation  of  mutual  savings  banks  and  savings  and  loan  associations. 

The  committee  conducted  24  days  of  public  hearings  in  May  and 
June  on  the  recommendations  of  the  President.  Oral  testimony  was 
received  from  217  A^dtnesses.  In  August,  two  further  days  of  public 
hearings  were  devoted  to  the  taxation  of  mutual  savings  banks  and 
savings  and  loan  associations. 

Executive  sessions  of  the  committee  on  the  President's  recommenda- 
tions for  an  investment  credit,  withholding  of  interest  and  dividends, 
etc.,  lasted  25  days.  Although  the  committee  took  no  final  action  on 
the  proposals,  except  with  respect  to  taxpayer  account  numbers, 
certain  tentative  decisions  were  made  for  the  purpose  of  having 
statutory  language  drafted  and  were  embodied  in  a  "discussion" 
draft  and  made  available  for  public  review.  On  August  23  Chairman 
Mills  announced  that  the  committee  had  fomid  it  impossible  to  con- 
clude its  deliberation  of  the  President's  tax  recommendations  during 
the  current  session,  but  that  consideration  of  the  program  would  be 
the  first  order  of  business  in  the  next  session  of  this  Congress. 

The  President's  proposal  for  taxpayer  account  numbers  was  handled 
as  a  separate  item  by  the  Congress  and  enacted  as  Public  Law  87-397, 
approved  October  5,  1961.  The  adoption  of  a  number  system  will 
make  possible  a  greatly  expanded  use  of  automatic  data  processing 
equipment  by  the  Internal  Revenue  Service  and  ^vill  enable  the 
Service  to  bring  together  all  tax  data  for  any  one  taxpayer.  For  this 
purpose  social  security  numbers  will  be  used  not  only  by  persons  who 
already  have  them,  but  also  by  the  remainder  to  whom  numbers  will 
be  assigned. 

Unemployment  compensation,  social  security,  and  pensions 

On  February  2,  1961,  the  President  sent  a  message  to  the  Congress 
proposing  a  program  to  restore  momentum  to  the  American  economy. 
Among  the  measures  suggested  to  aid  in  economic  recovery  were: 
A  temporary  program  for  extending  the  duration  of  benefits  under 
the  unemployment  insurance  system;  expansion  of  the  program  of  aid 
to  dependent  children  to  include  the  children  of  needy  unemployed 
parents;  and  a  five-point  program  to  increase  the  adequacy  of  benefits, 
and  to  relax  the  eligibility  rules  for  benefits  under  the  old-age  and 
sm'vivors,  and  disability  insurance  programs. 

The  Temporary  Extended  Unemployment  Compensation  Act  of 
1961,  Pubhc  Law  87-6,  was  approved  March  24,  1961.  Public  Law 
87-31,  approved  May  8,  1961,  made  Federal  grants  available  for  the 
period  May  1,  1961-June  30,  1962,  to  States  to  extend  aid  to  dependent 
children  of  unemployed  parents  on  the  same  basis  as  Federal  grants 
for  State  aid  programs  for  children  deprived  of  parental  support  by 


106   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

death,  absence,  or  incapacity  of  a  parent.  Tiie  Social  Security 
Amendments  of  1961,  Public  Law  87-64,  were  approved  June  30,  1961. 

The  Temporary  Extended  Unemployment  Compensation  Act  of 
1961  provided  extended  benefits  up  to  13  weeks  of  total  unemploy- 
ment to  workers  who  had  exhausted  their  rights  under  State  programs 
and  under  Federal  unemployment  compensation  programs  for  ex- 
servicemen  and  Federal  employees.  Payments  may  be  made  to 
unemployed  persons  who  have  exhausted  their  benefit  rights  imder 
State  programs  after  June  30,  1960,  and  before  April  1,  1962,  for 
weeks  of  unemployment  ending  before  July  1,  1962.  The  law  also 
provided  that  to  the  extent  a  State  pays  unemployment  compensation 
for  more  than  26  weeks  of  total  unemplo}Tiient  in  the  benefit  year, 
the  State  will  be  reimbursed  for  the  number  of  weeks  it  pays  in  excess 
of  26,  up  to  a  maximum  of  13. 

The  cost  of  the  program  is  to  be  financed  by  advances  from  the 
Treasury  to  be  repaid  by  temporarily  increasing  the  net  Federal 
unemplojanent  tax  from  3.1  percent  to  3.5  percent  on  the  existing  wage 
base  of  $3,000  for  calendar  years  1962  and  1963.  The  credit  against 
Federal  tax  for  contributions  to  State  unemplo5^nent  funds  is  to  be 
limited  b}^  assuming  a  3  percent  Federal  tax  rate. 

The  Social  Security  Amendments  of  1961  included  the  following 
provisions:  An  increase  from  $33  to  $40  in  the  minimum  monthly 
retirement  benefit  to  persons  retiring  at  or  after  age  65  and  in  the 
monthly  disability  benefit,  with  proportionate  increases  for  dependents 
and  survivors;  provision  for  payment  of  retirement  benefits  to  men 
at  age  62,  at  their  option,  with  reduced  benefits;  liberalization  of  the 
insured  status  requirements  to  provide  that  a  worker  is  fuU}^  covered 
if  he  has  one  quarter  of  coverage  for  every  year  elapsing  after  1950, 
or  after  the  year  in  which  he  attained  age  21  if  later,  and  up  to  the 
year  of  disability,  death,  or  attainment  of  age  65  for  men  and  age  62 
for  women;  an  increase  in  aged  widows',  widowers',  and  parents' 
benefits  from  75  to  82.5  percent  of  the  worker's  retirement  benefit;  and 
liberalization  of  the  earned  income  limitation  to  increase  from  $300 
to  $500  the  area  in  which  onl}^  half  of  earnings  above  $1,200  are  treated 
as  excess  earnings. 

The  cost  of  increased  benefits  is  to  be  financed  by:  An  increase 
in  the  contribution  rates  of  j^  of  1  percent  each  for  employees  and 
employers,  with  corresponding  increases  for  self-employed  persons, 
and  by  advancing  one  year,  to  1968,  the  time  at  which  the  ultimate 
scheduled  contribution  rate  becomes  effective.  For  the  calendar 
year  1962,  the  emplo5^ee  and  employer  tax  rate  will  be  3)8  percent  of 
the  first  $4,800  of  covered  wages,  and  the  self-emplo^mient  tax  will 
be  4.7  percent  of  the  first  $4,800  of  self-employment  income  for  any 
taxable  year  beginning  in  1962. 


REVIEW    OF    FISCAL    OPERATIONS  107 

Other  provisions  included  an  increase  in  the  Federal  matching 
maximum  for  old-age  assistance  and  aid  to  the  blind  and  permanently 
and  totally  disabled;  provision  for  expenditure  of  Federal  funds  for 
temporary  assistance  to  certain  U.S.  nationals  who  have  returned 
from  foreign  countries  as  a  result  of  war  or  similar  crisis  and  are 
without  immediately  available  resources;  extension  of  the  time  in 
which  State  and  local  government  employees  who  did  not  elect 
coverage  under  a  divided  retirement  system  may  change  their  de- 
cisions; the  addition  of  New  Mexico  to  the  list  of  States  which  are  per- 
mitted to  divide  their  retirement  systems;  and  the  permitting  of 
survivors  of  ministers  or  Christian  Science  practitioners  who  died  after 
September  12,  1960,  and  before  April  16,  1962,  to  elect  coverage  of  the 
minister  or  practitioner  in  certain  circumstances  if  the  election  is 
made  on  or  before  April  15,  1962. 

Public  Law  87-285,  approved  September  22,  1961,  changed  the 
eligibility  requirements  for  benefits  under  the  Railroad  Retu'ement 
Act  to  bring  them  in  line  with  the  changes  in  eligibility  requirements 
for  benefits  under  the  Social  Security  Amendments  of  1961. 

Extension  of  the  social  security  system  to  include  a  health  insurance 
program  for  all  persons  aged  65  or  over  who  are  eligible  for  social 
securit}^  or  railroad  retirement  benefits  was  recommended  by  President 
Kennedy  in  a  message  to  the  Congress  on  February  9,  1961.  The 
program  would  be  financed  by  an  increase  in  social  security  contribu- 
tions of  }^  of  1  percent  by  both  employers  and  employees  and  by  an 
increase  in  the  maximum  taxable  earnings  base  from  $4,800  a  yesiT 
to  $5,000.  Services  to  be  provided  would  include  inpatient  hospital 
services  up  to  90  days  for  a  single  illness,  nursing  home  services  up 
to  180  days  immediately  after  discharge  from  a  hospital,  and  certain 
hospital  outpatient  and  home  nursing  services.  The  Committee  on 
Ways  and  Aleans  held  hearings  for  nine  days  in  July  and  August 
1961  on  H.R.  4222,  which  incorporated  the  President's  recommenda- 
tions. Although  the  bill  was  not  reported  by  the  committee,  the 
Congress  incorporated  in  Public  Law  87-31  (aid  to  dependent  children) 
a  provision  increasing  from  $12  to  $15  the  maximum  average  medical 
care  expenditures  per  recipient  per  month  in  behalf  of  old-age 
assistance  recipients  with  respect  to  which  there  will  be  Federal 
participation. 

Public  Law  87-321,  approved  September  26,  1961,  was  designed  to 
prevent  the  imposition  of  a  double  tax  in  the  case  of  the  Federal  and 
State  unemplo3^nent  taxes,  arising  from  a  variation  in  the  definition 
of  "employer"  between  the  Federal  and  State  laws.  Under  prior  law, 
when  a  trade  or  business  changed  hands  within  the  first  20  weeks  of 
the  year,  the  predecessor  employer  was  not  treated  as  an  "employer" 
for  purposes  of  the  Federal  unemplo3^nent  tax,  but  generally  was  so 

614359—62 8 


108   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

considered  for  most  State  unemplo\Tnent  compensation  taxes.  As 
a  result,  the  first  employer  usually  had  to  pay  the  State  tax  in  such 
cases,  and  the  second  had  to  pay  the  full  Federal  tax  without  the 
credit  usually  available  for  the  State  tax  paid  by  the  first.  This  law- 
makes  the  usual  credit  available  in  such  cases. 

Proposals  to  permit  self-employed  persons  and  employees  not 
covered  by  pension  plans  to  postpone  tax  on  a  part  of  their  earned 
income  set  aside  in  specified  wa^^s  for  retirement  purposes  have  been 
actively  considered  by  the  Congress  for  a  number  of  years.  This 
year  a  plan  to  allow  self-employed  people  to  be  covered  by  voluntary 
pension  plans  was  passed  by  the  House  of  Representatives  as  H.R.  10. 
The  Senate  Finance  Committee  reported  an  amended  version  of 
the  bill  which  contained  a  niunber  of  technical  changes  suggested  by 
the  Treasury.  During  the  course  of  the  hearings  on  this  bill  before 
the  Senate  Finance  Committee,  the  Treasury  recommended  (exhibit 
15)  that  legislation  dealing  with  the  tax  treatment  of  the  retirement 
savings  of  self-employed  people  be  deferred  until  it  can  be  considered 
in  the  perspective  of  the  entire  tax  reform  program  which  the  Presi- 
dent directed  the  Treasury  to  prepare.  The  Treasmy  also  stated 
that  legislation  related  to  the  self-emploj^ed  was  not  desirable  without 
also  considering  the  present  treatment  of  owner-managers  and 
executives. 

Highway  financing 

Revised  cost  estimates  for  the  interstate  highway  system  having 
revealed  the  inadequacy  of  anticipated  revenues  of  the  highway  trust 
fund  to  permit  the  scheduled  completion  of  the  system  in  1972, 
President  Kennedy  sent  the  Congress  a  message  on  February  28,  1961, 
requesting  higher  taxes  for  highway  users.  The  President's  proposals 
were  designed  to  contain  the  construction  schedule  on  a  pay-as-j^ou-go 
basis,  as  originally  planned.  He  opposed  any  further  diversion  of 
general  fund  revenues  to  highway  use,  including  the  congressional 
action  in  1959  which  provided  for  transfer  of  part  of  the  revenues 
from  the  taxes  on  manufacturers'  sales  of  passenger  automobiles  and 
automobile  parts  and  accessories  to  the  highway  trust  fund  for  the 
fiscal  years  1962-64.  In  support  of  the  President's  proposal  Secretary 
Dillon  appeared  at  public  hearings  of  the  Committee  on  Ways  and 
Means  on  March  14,  1961.  (See  exhibit  14.)  Under  Secretary 
Fowler  represented  the  Treasury  before  the  Senate  Finance  Committee 
on  June  6,  1961. 

The  Federal-Aid  Higliway  Act  of  1961,  Public  Law  87-61,  approved 
June  29,  1961,  provides  additional  revenues  that  will  make  possible 
completion  of  the  interstate  highway  system  in  1972,  the  date  origi- 
nally contemplated.     Revenue  changes  in  the  law  will  bring  into  the 


REVIEW    OF   FISCAL    OPERATIONS  109 

highway  trust  fund  an  additional  $9.7  billion  over  the  life  of  the  pro- 
gram in  addition  to  transferring  back  to  the  general  fund  $2.5  billion 
in  revenues  attributable  to  the  taxes  on  passenger  cars  and  automobile 
parts  which,  under  prior  legislation,  would  have  been  transferred  to 
the  trust  fund  in  the  fiscal  years  1962-64. 

The  legislation:  Continued  until  October  1,  1972,  the  4-cents  per 
gallon  rate  on  gasoline,  diesel  fuel,  and  special  motor  fuels  which  had 
been  scheduled  to  be  reduced  to  3  cents  per  gallon  on  June  30,  1961; 
increased  the  tax  on  tires  for  high  way- type  vehicles  from  8  to  10  cents 
a  pound,  on  inner  tubes  from  9  to  10  cents  a  pound,  and  on  tread 
rubber  from  3  to  5  cents  a  pound;  raised  the  annual  tax  on  highway 
vehicles  with  a  gross  weight  of  more  than  26,000  pounds  from  $1.50  to 
$3  for  each  1,000  pounds  and  provided  for  pajnnent  of  the  tax  on  a 
quarterly  basis;  dedicated  to  the  highway  trust  fund  the  entire  revenues 
received  after  June  30,  1962,  from  the  manufacturers'  tax  on  trucks, 
buses,  and  trailers;  continued  the  highway  trust  fund  for  an  addi- 
tional three  months  to  October  1,  1972,  with  all  taxes  dedicated  to  the 
fund  continued  at  present  rate  levels  for  the  additional  three  months; 
exempted  from  tax  gasoline  which  is  sold  for  nonfuel  purposes  in  the 
manufacture  of  another  article;  and  imposed  floor  stocks  taxes  of  2- 
cents  per  pound  on  tires  and  tread  rubber  and  1-cent  per  pound  on 
inner  tubes,  except  tubes  for  bicycle  tires  which  were  held  for  sale  on 
July  1,  1961. 

In  considering  this  legislation,  the  Committee  on  Ways  and  Means 
directed  the  Treasury  Department  to  make  a  study  analyzing  various 
aspects  of  the  truck  weight  tax.  The  House  and  Senate  Conference 
Committee  requested  the  Treasury  to  conduct  a  study  of  the  loss  of 
gasoline  by  retail  dealers  through  shrinkage,  evaporation,  or  other 
causes. 

Depreciation  developments 

Progress  was  made  in  two  important  areas  of  depreciation  reform 
to  encourage  modernization  and  expansion  of  the  productive  machinery 
and  equipment  of  the  Nation's  industry:  A  recommendation  for  legis- 
lation for  an  investment  credit  to  supplement  depreciation  allowances, 
and  urgent  studies  looking  toward  administrative  updating  and 
revision  of  depreciation  schedules  in  the  light  of  current  conditions. 

The  investment  tax  incentive  credit  proposal  outlined  by  the 
President  in  his  tax  message  of  April  20  was  later  tentatively  approved 
by  the  Committee  on  Ways  and  Means  for  inclusion  in  its  public 
discussion  draft  in  the  form  of  an  8  percent  credit  against  tax  on 
investments  in  most  types  of  machinery  and  equipment.  In  making 
this  recommendation,  the  President  also  indicated  that  a  review  of 
depreciation  rules  and  methods  was  underway  in  the  Department, 


110    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

as  a  part  of  its  overall  tax  reform  study,  to  determine  what  changes 
were  appropriate.  _ 

A  preliminary  report  by  the  Department  on  January  5,  1961, 
summarized  findings  of  a  questionnaire  survey  of  a  cross  section  of 
American  industry,  previously  initiated  in  cooperation  with  the 
Small  Business  Administration,  to  obtain  information  on  the  operation 
of  existing  depreciation  provisions  of  the  tax  law,  asset  lives,  the 
adequacy  of  existing  allowances,  and  the  feasibility  of  alternative 
approaches  to  reform.  (See  the  1960  Annual  Report,  page  52.) 
This  preliminary  report  dealt  primarily  with  the  portions  of  the  survey 
questionnaire  relating  to  depreciation  practices,  the  extent  of  adoption 
of  the  new  liberalized  depreciation  methods  previousl}'^  authorized  by 
the  1954  Internal  Revenue  Code,  and  respondents'  views  on  alterna- 
tive changes  in  depreciation  rules.  Subsequently,  the  Department 
carried  forward  an  intensive  study  of  tabulations  from  the  statistical 
schedules  included  in  the  surve}^  as  a  basis  for  realistic  revision  of  the 
lives  of  capital  assets  to  reflect  existing  practices  and  technological 
obsolescence. 

Information  from  the  Treasury  depreciation  survey  bearing  on  de- 
preciation revision  was  supplemented  with  tabulations  of  depreciable 
lives  of  property  from  tax  returns  for  1959,  special  engineering  studies 
conducted  by  the  Internal  Revenue  Service,  and  a  general  review  of 
obsolescence  trends  and  rate  of  loss  of  economic  usefulness  of  depreci- 
able property. 

On  May  2,  1961,  the  President  directed  the  Treasury  Department 
to  review  the  depreciation  schedules  for  textile  machinery  as  part  of 
a  program  developed  by  a  Cabinet  committee  to  deal  with  problems 
of  the  textile  industry.  This  priority  study  of  depreciation  allowances 
provided  the  basis  for  a  revision  of  suggested  average  useful  lives  for 
major  types  of  machinery  and  equipment  used  in  the  textile  industry, 
published  by  the  Internal  Revenue  Service  in  Bulletin  "F."  The 
revision  was  announced  by  the  President  on  October  11,  1961.  Esti- 
mated average  useful  lives  suggested  in  Bulletin  "F"  for  most  textile 
machinery  and  equipment  were  reduced  from  25  years  or  longer  to 
15  years,  and  in  some  cases,  12  years.  Similar  studies  were  continued 
for  all  sectors  of  industry.  On  December  6,  1961,  Secretary  Dillon 
announced  the  initiation  of  special  engineering  studies  of  six  major 
industries  as  part  of  this  review.  The  industries  included  were  air- 
craft and  parts  manufacturers,  automobile  manufacturers,  electrical 
machinery  and  equipment  manufactm-ers,  metalworking  machinery 
and  machine  tools,  raihoads,  and  steel  mills. 

As  part  of  its  depreciation  studies,  the  Department  also  examined 
ways  in  which  the  application  of  the  depreciation  allowances  might 
be  simplified  so  as  to  minimize  controversy  between  the  taxpayers 


REVIEW    OF    FISCAL    OPERATIONS  111 

and  the  Internal  Revenue  agents.  Tentative  decisions  by  the  Com- 
mittee on  Waj's  and  Means  in  the  development  of  a  draft  bill  incor- 
porating the  President's  tax  recommendations  included  a  provision 
relaxing  the  existing  rule  on  salvage  by  permitting  estimated  salvage 
up  to  10  percent  of  an  asset's  cost  to  be  disregarded  in  computing 
depreciation  on  machinery  and  equipment.  This  proposed  change  in 
the  treatment  of  salvage  value  was  facilitated  by  a  Presidential  recom- 
mendation, the  substance  of  which  was  included  in  the  draft  bill  with 
respect  to  personal  property,  for  the  taxation  of  gain  on  dispositions 
of  depreciable  property  as  ordinary  income  to  the  extent  of  depreciation 
previously  taken  on  the  property. 

Miscellaneous  legislation 

Public  Law  87-15,  approved  March  31,  1961  (which  amended  and 
extended  the  Sugar  Act  of  1948),  postponed  the  termination  of  the 
tax  on  manufactured  sugar  from  September  30,  1961,  to  December  31, 
1962,  and  provided  that  floor  stocks  refund  shall  apply  to  manufac- 
tured sugar  held  by  importers  for  sale  on  December  31,  1962,  rather 
than  September  30,  1961,  if  claim  for  such  refund  is  filed  on  or  before 
March  31,  1963. 

Enacted  at  the  request  of  the  President  as  a  step  toward  the  im- 
provement of  this  country's  ability  to  defend  its  gold  reserves.  Public 
Law  87-29,  approved  May  4,  1961,  provided  an  exemption  from  tax 
for  income  derived  by  a  foreign  central  bank  of  issue  from  U.vS.  Gov- 
ernment obligations,  but  only  if  the  obligations  are  not  held  for  or 
used  in  connection  with  commercial  banking  functions  or  other  com- 
mercial banking  activities.  The  exemption  is  effective  with  respect 
to  income  received  in  taxable  years  beginning  after  1960,  A  Senate 
amendment  revised  the  provision  relating  to  the  time  within  which 
shareholders  of  a  small  business  corporation  can  consent  to  having  it 
treated  as  a  partnership.  Where  a  husband  and  wife  hold  shares  as 
community  property,  the  period  for  filing  consent  by  one  spouse  shall 
not  expire  prior  to  May  15,  1961,  if  the  other  filed  a  timely  consent 
for  a  taxable  year  of  the  corporation  beginning  before  January  1,  1961. 

Public  Law  87-59,  approved  June  27,  1961,  included  a  provision 
extending  for  two  years  (1960  and  1961)  the  period  within  which 
certain  stock  life  insurance  companies  may  make  deductible  distribu- 
tions to  shareholders  in  acquisition  of  stock  pursuant  to  a  plan  of 
mutualixation  adopted  prior  to  January  1,  1958. 

Public  Law  87-109,  approved  July  26,  1961,  was  designed  to 
offset  the  decision  of  the  Supreme  Court  in  Automobile  Club  of 
Michigan  v.  Commissioner  (1957)  and  provided  that  membership 
organizations  may  elect  to  report  prepaid  dues  income  over  the 
period  during  which  there  is  a  liability  on  the  part  of  the  organizations 
to  provide  the  service,  rather  than  in  the  year  in  which  the  dues  are 


112   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

received.  The  liability  must  extend  beyond  the  current  year  but 
not  for  more  than  36  months.  The  provision  applies  only  to  member- 
ship organizations  having  no  capital  stock  and  making  no  distributions 
of  net  earnings.  A  transitional  rule  is  provided  designed  to  spread 
over  a  period  of  years  the  Government's  loss  of  revenue  as  the  result 
of  the  change  in  reporting.  Taxpayers  may  elect  the  reporting  method 
for  taxable  years  beginning  with  the  calendar  year  1961. 

The  Mutual  Educational  and  Cultural  Exchange  Act  of  1961, 
Public  Law  87-256,  approved  September  21,  1961,  provided  that 
students  who  are  not  candidates  for  degrees  may  exclude  from  gross 
income  scholarship  and  fellowship  grants  by  a  foreign  government, 
international  organization,  and  certain  binational  or  multinational 
organizations  to  the  same  extent  as  was  previously  provided  for 
grants  made  by  domestic  organizations  and  governmental  units  in 
the  United  States;  made  nonimmigrant  alien  students  and  certain 
trainees,  teachers,  etc.,  temporarily  present  in  the  United  States 
subject  to  tax  on  U.S.  income  (generally  the  taxable  portion  of 
scholarships  and  fellowships)  at  income  tax  rates  applicable  to  citizens 
(with  conforming  changes  in  withholding)  rather  than  the  minimum 
30  percent  rate  generally  applicable  to  nonresident  aliens  not  engaged 
in  trade  or  business;  and  excluded  from  gross  income  compensation 
paid  by  a  foreign  employer  to  a  nonresident  alien  while  he  is  tem- 
porarily in  the  United  States  as  a  nonimmigrant  student,  trainee, 
etc.  Services  performed  by  such  individuals  as  part  of  their  edu- 
cational, teaching,  or  training  programs  are  not  to  be  considered 
employment  for  purposes  of  social  securitj'-  and  unemployment 
compensation  taxes. 

Public  Law  87-293,  approved  September  22,  1961,  provided  specific 
measures  for  the  taxation  of  civilian  officers  and  employees  of  the 
Government  under  the  Peace  Corps  Act.  Certain  allowances  are 
excluded  from  taxable  income;  the  tax  on  income  from  back  pay 
reported  in  the  current  year  is  limited  to  the  tax  that  would  have 
been  due  on  the  pay  if  received  and  taxed  in  the  year  to  which  it  is 
attributable;  and  payments  for  services  (other  than  termination 
payments)  are  excluded  from  the  definition  of  "wages"  for  income 
tax  withholding  purposes.  The  head  of  the  Federal  agency  having 
control  of  the  Peace  Corps  services  will  make  the  determinations  as 
to  whether  services  of  volunteers  constitute  "employment"  for 
purposes  of  the  taxes  imposed  by  the  Federal  Insurance  Contributions 
Act;  will  determine  the  amount  of  their  remuneration  which  con- 
stitutes "wages"  for  such  purposes;  and  will  make  returns  and  pay- 
ments of  such  taxes. 

Manufacturers  of  brick  and  tile  clay  and  any  other  shale,  where 
the  finished  product  is  the  first  commercially  marketable  product, 


REVIEW    OF    FISCAL    OPERATIONS  113 

are  permitted  under  Public  Law  87-312,  approved  September  26, 
1961,  to  base  their  percentage  depletion  for  all  open  taxable  years 
beginning  before  January  1,  1961,  upon  the  value  of  the  finished  or 
end  product.  For  the  purpose  of  computing  the  depletion,  the 
"gross  income  from  the  property"  shall  be  50  percent  of  the  gross 
income  from  the  finished  product  but  not  more  than  $12.50  for  each 
ton  of  clay  or  shale  used  in  the  finished  product.  Public  Law  87-321 
(see  section  on  social  security)  incorporated  a  provision  that,  for 
open  past  years,  ordinary  treatment  processes  in  the  case  of  quartzite 
and  clay  mined  and  used  by  the  mine  owner  or  operator  in  production 
of  refractory  products  may  include  crushing,  grinding,  and  separating 
the  mineral  from  waste,  but  shall  not  include  any  subsequent  process. 
In  addition  the  section  provided  a  method  of  determining  the  value 
of  each  ton  of  such  quartzite  and  clay  used  in  the  production  of 
refractory  products.  To  have  these  new  provisions  apply,  the  tax- 
payer must  make  an  election  which  woidd  be  effective  on  and  after 
January  1,  1951,  for  all  open  taxable  years  beginning  before  January  1, 
1961.  These  two  laws  modify  the  effect  of  the  Supreme  Court 
decision  in  Cannelton  Sewer  Pipe  Co.  v.  United  States  (see  the  1960 
Annual  Report,  page  51). 

A  system  of  annuities  for  surviving  widows  and  dependent  children 
of  judges  of  the  Tax  Court  of  the  L^nited  States  was  provided  by 
Public  Law  87-370,  approved  October  4,  1961.  Included  in  the  law 
is  a  provision  which  extended,  for  taxable  years  beginning  after 
December  31,  1957,  to  annuities  purchased  by  employers  for  employees 
of  public  school  systems  the  same  tax  treatment  granted  annuities 
purchased  for  employees  by  organizations  exempt  under  section 
501(c)(3)  of  the  Internal  Revenue  Code  as  charitable,  religious, 
and  educational  organizations. 
Administration,  interpretation,  and  clarification  of  tax  laws 

During  the  fiscal  year,  the  Treasury  Department  published  81 
Treasury  decisions,  6  Executive  orders,  and  59  notices  of  proposed 
rulemaking  relating  to  tax  matters.  All  previously  published  reg- 
ulations under  the  1954  Code  relating  to  income  taxes,  employment 
taxes,  and  procedure  and  administration  were  republished  with  the 
incorporation  of  technical  revisions. 

Enactment  of  the  Dealers  Reserve  Adjustment  Act  of  1960  (26 
U.S.C.  481  note)  required  the  prompt  issuance  of  temporary  regula- 
tions relating  to  the  methods  of  computing  and  paying  the  tax  per- 
mitted by  the  act.  One  new  major  regulation  under  the  1954  Code  was 
completed  on  miscellaneous  stamp  taxes.  Other  Treasury  decisions 
published  concerned  the  definition  of  partnerships,  corporations, 
associations  and  trusts,  the  manner  of  computing  the  income  tax 
for  life  insurance  companies,  the  definition  of  "scientific"  for  purposes 


114   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

of  determining  whether  certain  organizations  are  exempt  from  income 
tax,  and  the  requirement  of  bonds  for  certain  importers  of  motor 
vehicles. 

Notices  of  proposed  rulemaking  were  published  during  the  year 
relating  to:  The  documentary  stamp  tax;  carryovers  in  certain 
corporate  acquisitions;  real  estate  investment  trusts;  prepaid  sub- 
scription income;  and  distributions  by  bank  holding  companies. 

The  Secretary  of  the  Treasury  appeared  before  the  Committee  on 
Ways  and  Means  on  May  3,  1961,  to  detail  the  administration's 
tax  program.  He  submitted  as  part  one  of  a  four-part  document 
on  expense  accounts  a  preliminary  report  of  a  study  undertaken 
pursuant  to  the  request  in  the  Public  Debt  and  Rate  Extension  Act 
of  1960  (26  U.S.C.  162  note)  concerning  the  results  of  the  Internal 
Revenue  Service's  accelerated  enforcement  program  relating  to 
deductions  as  business  expenses  of  expenditures  for  entertainment, 
gifts,  dues,  or  initiation  fees  in  social,  athletic,  or  sporting  clubs  or 
organizations.  The  report  was  based  on  special  examinations  of 
some  38,000  business  tax  returns  claiming  such  deductions. 

International  Financial  and  Monetary  Developments 

Measures  to  strengthen  the  U.S.  balance-of-payments  position,  ef- 
forts to  increase  the  amount  and  the  effectiveness  of  international 
capital  provided  for  the  advancement  of  the  less-developed  areas  of 
the  world,  and  consideration  of  the  need  to  improve  international 
monetary  arrangements  dominated  U.S.  Government  activities  in 
international  finance  during  the  fiscal  year.  The  Treasury  Depart- 
ment worked  actively  in  these  and  related  fields.  The  National 
Advisory  Council  on  International  Monetary  and  Financial  Problems, 
of  which  the  Secretary  of  the  Treasury  is  the  chairman,  continued, 
in  accordance  with  its  statutory  authority,  to  coordinate  the  policies 
and  operations  of  the  representatives  of  the  United  States  on  the 
international  financial  institutions  of  which  the  United  States  is  a 
member  and  of  all  agencies  of  the  Government  which  make  or  par- 
ticipate in  making  foreign  loans,  or  which  engage  in  foreign  financial, 
exchange,  or  monetary  transactions. 

The  U.S.  balance  of  pa^mients  has  been  in  deficit  for  a  number  of 
years,  and  the  large  deficits  in  the  calendar  years  1958,  1959,  and 
1960  were  settled  m  part  by  sizable  outflows  of  gold.  An  improve- 
ment in  the  trade  balance  in  1960  was  off'set  by  an  outflow  of  short- 
term  funds  aggravated  by  speculative  forces.  U.S.  determination  to 
seek  solutions  to  its  balance-of-payments  problem  along  lines  con- 
sistent with  its  international  obligations  and  policies,  and  in  full 
recognition  of  the  position  of  the  dollar  as  an  essential  cornerstone 


REVIEW    OF    FISCAL    OPERATIONS  115 

in  the  international  financial  system  of  the  free  world,  was  made  clear 
by  President  Eisenhower  in  the  closing  weeks  of  1960.  President 
Kennedy,  in  a  message  to  the  Congress  on  February  6,  1961,  on 
balance  of  payments  and  gold,  reaffirmed  these  objectives  and  out- 
lined a  comprehensive  program  for  restoring  balance  in  the  interna- 
tional pa5niients  position  of  the  United  States,  with  respect  to  the 
problems  both  of  correcting  the  persisting  basic  deficit  and  of  meeting 
short-term  demands  on  reserves.  The  Secretary  of  the  Treasury  has 
undertaken  general  coordinating  responsibility  for  the  measures  to  be 
carried  out  by  the  various  departments  and  agencies,  as  directed  in 
the  President's  message. 

Two  new  international  financial  institutions,  in  the  establishment 
of  which  the  United  States  had  taken  an  active  part,  commenced 
lending  operations  during  the  fiscal  year.  The  International  Develop- 
ment Association,  as  an  affiliate  of  the  International  Bank  for  Recon- 
struction and  Development,  provides  development  credits  on  flexible 
terms  to  less-developed  areas  within  its  membership,  using  funds 
subscribed  on  the  basis  of  systematic  budgetary  contributions  by  all 
members.  The  Inter-American  Development  Bank,  which  employs 
a  variety  of  instruments  designed  to  stimulate  the  process  of  economic 
development  among  its  members  in  the  Western  Hemisphere,  was 
designated  as  the  primary  mechanism  for  administering  funds  for 
social  development  to  be  provided  by  the  United  States  within  the 
framework  of  the  new  Alliance  for  Progress.  The  Alliance  was  an- 
nounced by  the  President  in  March  1961,  as  an  invitation  to  the 
Latin  American  nations  to  cooperate  through  their  own  self-help 
measures  in  renewed  efforts  to  promote  economic  development  and 
social  justice.  The  Alliance  for  Progress  among  the  American  Re- 
publics is  to  be  implemented  under  the  terms  of  the  Charter  of  Punta 
del  Este,  signed  at  a  special  meeting  of  the  Inter-American  Economic 
and  Social  Council  held  at  Punta  del  Este,  Uruguay,  in  August  1961. 

Major  efforts  were  made  during  the  year  to  bring  about  a  greater 
and  more  united  drive  among  the  free  industrialized  nations  to  assist 
the  less-developed  nations  on  a  long-term  basis  to  achieve  self- 
sustained  growth.  The  President,  in  March  1961,  recommended 
to  the  Congress  a  revision  in  the  organization  of  U.S.  foreign  aid 
and  in  its  basic  concepts  of  operation.  These  concepts  included  a 
new  stress  on  long-term  planning  and  financing  based  on  development 
programs  for  individual  countries  and  special  attention  to  nations 
willing  to  undertake  necessary  internal  reforms  and  self-help  measures. 
He  also  called  upon  the  other  industrialized  nations  to  join  the 
United  States  in  a  common  effort  to  assist  the  developing  countries. 
As  one  element  in  this  common  effort,  the  United  States  became  a 


116   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

member  of  the  Organization  for  Economic  Cooperation  and  Develop- 
ment which  came  into  being  on  September  30,  1961.  Membership  in 
the  OECD  also  provides  the  United  States  with  a  framework  for 
carrying  out  intensive  and  frequent  international  consultations  with 
the  other  industrialized  countries  on  economic  and  financial  policies. 
As  the  result  of  these  and  other  consultations,  progress  was  made 
during  the  fiscal  yesir  toward  a  better  coordinated  and  a  more  stable 
pattern  of  international  interest  rate  relationships,  and  cooperative 
arrangements  were  worked  out  for  stabilizing  exchange  markets. 

Consideration  of  specific  improvements  in  international  monetary 
arrangements  led  to  the  proposal  by  the  Managing  Du'ector  of  the 
International  Monetary  Fund,  Per  Jacobsson,  that  each  of  the 
principal  industrial  countries  commit  itself  to  lend  its  currency  to 
the  Fund  to  insure  that  sufficient  amounts  would  be  available  should 
balance-of-payments  pressures  involving  these  countries  ever  impair 
or  threaten  to  impair  the  smooth  functioning  of  the  world  payments 
system. 

The  annual  meetings  of  the  Boards  of  Governors  of  the  Inter- 
national Bank  for  Reconstruction  and  Development  and  its  affiliates, 
the  International  Finance  Corporation  and  the  International  Develop- 
ment Association,  and  of  the  International  Monetary  Fund  were 
held  in  Vienna,  Austria,  September  18-22,  1961.  Secretary  of  the 
Treasury  Dillon,  in  his  capacity  as  U.S.  Governor  of  these  institu- 
tions, headed  the  U.S.  delegation.  The  delegation  included  Under 
Secretary  of  State  George  Ball,  the  Alternate  U.S.  Governor,  and  Under 
Secretary  of  the  Treasury  for  Monetary  Affairs  Robert  V.  Roosa, 
Assistant  Secretary  of  the  Treasury  John  M.  Leddy  (U.S.  Executive 
Director  of  the  IBRD),  and  Special  Assistant  to  the  Secretar^^  Frank 
A.  Southard,  Jr.  (U.S.  Executive  Director  of  the  Fund),  as  Temporary 
Alternate  Governors.  The  delegation  also  included  members  of  the 
House  Banking  and  Currency  Committee,  other  members  of  the 
National  Advisory  Council  on  International  Monetary  and  Financial 
Problems,  members  of  the  Council  of  Economic  Advisers,  other 
officials  of  the  executive  branch,  the  President  and  Vice  President 
of  the  Federal  Reserve  Bank  of  New  York,  and  the  Charge  d'Affaires 
of  the  American  Embassy  in  Vienna. 

On  September  20,  1961,  Secretary  Dillon  addressed  the  meeting 
of  the  Governors  of  the  International  Monetary  Fund  in  connection 
with  the  discussion  of  the  Fund's  Annual  Report  (see  exhibit  26). 
As  is  customary  in  the  U.S.  Governor's  address  to  the  Fund,  Secretary 
Dillon  reviewed  the  domestic  economic  situation  in  the  United  States 
and  recent  developments  relating  to  the  U.S.  balance  of  payments. 
In  his  statement  the  Secretary  supported  the  suggestion  by  the 
Fund's  Managing  Du"ector  regarding  borrowing  arrangements  between 


REVIEW    OF    FISCAL    OPERATIONS  117 

the  Fund  and  the  principal  industrial  countries  to  provide  needed 
supplementary  resources  to  the  Fund.  There  was  support  in  principle 
on  the  part  of  the  other  Governors  for  this  suggestion,  and  it  was 
the  consensus  that  the  specific  arrangements  necessary  for  carrying 
the  borrowing  plan  into  effect  could  be  formulated  in  the  course  of 
the  ensuing  months. 

The  U.S.  balance  of  payments  and  gold  and  dollar  movements 

The  U.S.  balance  of  payments. — In  the  fiscal  year  1961,  the  overall 
balance-of-payments  deficit  of  the  United  States,  as  measured  by 
changes  in  gold  and  convertible  currency  holdings  of  U.S.  monetary 
authorities  and  in  liquid  liabilities  of  banks  and  monetary  authorities 
in  the  United  States  to  foreigners,  amounted  to  $2.7  billion.  This 
compared  with  an  overall  deficit  of  $3.3  billion  in  fiscal  1960.  (Ex- 
cluding prepayments  on  foreign  countries'  indebtedness  to  the  U.S. 
Government  amounting  to  $724  million  in  fiscal  1961  and  $285  million 
in  fiscal  1960,  the  overall  deficit  in  fiscal  1961  was  $3.4  billion  com- 
pared with  $3.5  billion  in  fiscal  1960.) 

Although  our  overall  payments  position  thus  showed  some  improve- 
ment in  fiscal  1961  as  compared  with  1960,  most  of  the  $600  million 
decrease  in  the  overall  deficit  represented  the  excess  of  special  debt 
service  prepayments  to  the  U.S.  Government  in  1961  over  those  in 
fiscal  1960.  The  maintenance  of  the  deficit  near  the  high  level  of 
the  previous  year  resulted  from  a  very  large  outflow  of  private  short- 
term  capital  from  the  United  States.  This  outflow,  which  is  taken 
to  be  roughly  equivalent  to  the  net  movements  of  U.S.  private  short- 
term  capital,  foreign  commercial  credits  to  the  United  States,  and 
transactions  not  otherwise  accomited  for  (errors  and  omissions), 
totaled  $2.6  billion  in  fiscal  1961  m  contrast  to  less  than  $400  million 
in  1960.  This  rise  in  short-term  capital  outpayments  tended  to 
cloak  the  very  impressive  improvement  made  in  our  other  accounts, 
particularly  in  our  merchandise  trade. 

Our  underlying  payments  position,  aside  from  the  short-term  capital 
movements,  is  measured  by  the  "basic  balance,"  i.e.,  the  balance  on 
all  recorded  transactions  exclusive  of  U.S.  private  short-term  capital 
outflow  and  foreign  commercial  credits  to  the  United  States.  The 
basic  deficit  of  the  United  States  was  only  $37  million  in  fiscal  1961 
($761  miUion  exclusive  of  debt  service  prepayments)  as  compared  with 
a  basic  deficit  of  $2.9  biUion  in  fiscal  1960  ($3.2  billion  exclusive  of 
prepayments).  As  noted  above,  the  overall  deficit  in  fiscal  1961  was 
much  larger  than  the  basic  deficit. 

The  substantial  improvement  in  our  basic  position  in  fiscal  1961 
reflected  the  very  large  increase  in  our  merchandise  trade  surplus. 
Our  nonmilitary  merchandise  exports  rose  by  $1.7  biUion  to  $19.7 


118   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

^ 

billion  and  our  imports  declined  by  $1.6  bUlion  to  $13.9  biUion. 
Thus  our  merchandise  export  surplus,  at  $5.8  billion,  was  substantially 
more  than  double  the  $2.5  billion  export  sm-plus  of  19G0.  In  both 
years,  approximately  $2  billion  of  our  merchandise  export  surplus 
reflected  U.S.  exports  financed  under  various  foreign  economic 
assistance  programs  of  the  U.S.  Government. 

Our  military  expenditures  abroad  in  each  of  the  fiscal  years  1960 
and  1961  were  slightly  over  $3  billion,  U.S.  receipts  on  other  current 
account  items  such  as  investment  income,  military  goods  sales,  travel 
and  transportation,  and  royalties  and  license  fees,  rose  by  about 
$465  million  in  fiscal  1961  over  1960,  while  U.S.  payments  for  such 
items  and  for  remittances  and  pensions  rose  by  only  about  $65  million, 
accounting  for  a  further  improvement  of  about  $400  million  in  our 
basic  accounts. 

U.S.  private  direct  and  portfolio  investment  abroad,  however, 
increased  by  about  $430  million,  amounting  to  $2.6  billion  in  fiscal 
1961.  Some  $370  million  of  the  increase  was  ascribable  to  a  single, 
large  direct  investment  transaction  involving  cash  payments.  At 
the  same  time,  U.S.  receipts  from  foreign  long-term  capital  inflow 
declined  by  about  $360  million,  amounting  to  $275  million.  Thus, 
our  long-term  private  investment  accounts  resulted  in  net  outpay- 
ments  to  foreigners  of  almost  $800  million  more  m  fiscal  1961  than  in 
1960. 

Gross  U.S.  Government  foreign  economic  assistance  rose  by  $500 
million,  to  a  total  of  $3.0  billion  in  fiscal  1961,  reflecting  a  higher  level 
of  aid  to  the  less-developed  countries.  A  substantial  part  of  the 
increase  arose  from  an  expansion  of  assistance  in  the  form  of  U.S. 
siu"plus  agricultural  products  which  contributed  to  the  higher  U.S. 
merchandise  trade  surplus. 

Thus,  our  net  receipts  from  our  larger  merchandise  export  surplus 
and  on  our  invisible  accounts  totaled  $3.8  billion  more  in  fiscal  1961 
than  those  in  fiscal  1960,  while  the  increase  in  our  net  outpayments  to 
foreigners  on  public  and  private  long-term  capital  accounts  (exclusive 
of  special  foreign  debt  service  prepayments  to  the  U.S.  Government) 
totaled  about  $1.4  billion.  The  net  uiiprovement  in  our  basic 
accounts,  excluding  the  improvement  due  to  larger  prepayments  on 
foreign  indebtedness  to  the  U.S.  Government  in  fiscal  1961  over 
fiscal  1960,  amounted  to  $2.4  billion  (the  difference  between  our  basic 
deficits  of  $761  million  in  fiscal  1961  and  $3.2  billion  in  fiscal  1960). 

In  accordance  with  the  U.S.  policy  of  buying  and  selling  gold  at 
$35  per  fine  ounce  (exclusive  of  handling  charges)  in  transactions  with 
foreign  governments,  central  banks,  and  under  certain  conditions 
international  institutions,  for  the  settlement  of  international  balances 
and  other  legitimate  monetary  purposes,  net  monetary  sales  of  gold 


REVIEW    OF    FISCAL    OPERATIONS  119 

during  the  fiscal  year  amounted  to  $1,730  million  (see  table  111), 
$187  million  of  which  is  attributable  to  the  period  January-June  1961. 

In  a  statement  before  the  Subcommittee  on  International  Exchange 
and  Payments  of  the  Joint  Economic  Committee  of  Congress,  June  19, 
1961  (see  exhibit  25),  the  Secretary  described  recent  developments  of 
the  U.S.  balance  of  payments,  pressures  which  have  arisen  in  the 
principal  exchange  markets,  and  some  of  the  specific  steps  that  have 
been  taken  to  deal  with  exchange  market  pressures.  (Other  state- 
ments by  the  Secretary  on  the  balance-of-payments  situation  are 
presented  in  exhibits  18  and  21.) 

Gold  and  dollar  movements. — The  gold  and  liquid  dollar  assets  of 
foreign  countries  (excluding  gold  holdings  of  the  U.S.S.R.,  other 
Eastern  European  countries,  and  China  Mainland)  amounted  to  an 
estimated  $39.8  billion  as  of  June  30,  1961.  Of  this  amount,  official 
gold  reserves  were  $20.8  billion,  official  and  private  short-term  dollar 
assets  held  with  banks  in  the  United  States  were  $17.5  billion,  and 
estimated  official  and  private  holdings  of  U.S.  Government  bonds  and 
notes  were  $1.4  billion.  The  total  represented  an  increase  of  $2.4 
billion  over  the  estimated  $37.4^,billion^held  as  of  June  30,  1960  (see 
table  112). 

Western  European  countries  increased  their  gold  and  liquid  dollar 
assets  during  fiscal  1961  by  $2.3  billion;  the  largest  gain  ($1.3  billion) 
was  made  by  Germany,  Asiatic  holdings  rose  by  $344  million,  and 
reflected  a  gain  of  $508  million  by  Japan.  Canadian  holdings  in- 
creased by  $160  million.  Latin  America,  on  the  other  hand,  experi- 
enced a  decline  of  $284  milHon.  The  holdings  of  the  rest  of  the  world 
decreased  by  $90  million. 

The  gold  and  liquid  doUar  assets  held  by  international  institutions 
rose  by  $872  million,  from  a  total  of  $6.6  billion  at  the  end  of  fiscal 
1960  to  $7.5  billion  at  the  end  of  fiscal  1961. 

The  estimated  official  gold  holdings  of  the  world  (excluding  the 
U.S.S.R.,  other  Eastern  European  countries,  and  China  Mainland) 
were  $40.9  billion  as  of  June  30,  1961.  Of  this  amount,  the  United 
States  held  $17.6  billion  and  international  institutions  $2.5  billion. 

Treasury  foreign  exchange  reporting  system. — Data  relating  to 
capital  movements  between  the  United  States  and  foreign  countries 
have  been  collected  by  the  Treasury  Department  since  1935.  The 
data  are  obtained  from  monthly  reports  by  banks  and  brokers  and 
quarterly  reports  by  nonfinanciaj  concerns  to  the  Treasury  Depart- 
ment through  the  Federal  Reserve  Banks.  The  reports  provide 
information  on  liabilities  to  foreigners,  claims  on  foreigners,  and 
securities  transactions  with  foreigners,  and  constitute  the  basis  for 
statistics  on  the  dollar  holdings  of  foreign  countries  and  international 


120   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

institutions  and  other  statistics  on  capital  movements  which  enter 
into  the  U.S.  balance  of  payments. 

Because  of  the  increasing  importance  of  these  statistics  in  the 
formulation  of  U.S.  Government  policies,  a  program  was  instituted 
during  the  fiscal  year  to  enlarge  the  coverage  and  to  improve  the 
reliability  of  the  reports.  This  program  has  included:  Conferences 
with  Federal  Reserve  Banks  and  reporting  institutions  to  review 
reporting  problems  and  the  operation  of  the  reporting  sj^stem ;  special 
surveys  of  particular  reporting  problems;  the  introduction  of  systems 
of  obtaining  rapid  reports  of  summary  data;  and  steps  to  acquaint 
increasing  numbers  of  prospective  reporters  with  the  reporting  require- 
ments. These  actions  were  part  of  a  continuing  program  to  insure 
the  reliability  of  these  capital  movements  statistics. 

Gold  holdings  oj  U.S.  citizens  abroad. — On  January  14,  1961,  the 
President  issued  an  Executive  order  prohibiting  the  holdings  by  U.S. 
citizens  and  enterprises,  and  by  other  persons  subject  to  the  jurisdic- 
tion of  the  United  States,  of  gold  situated  abroad  and  of  securities 
representing  gold  on  deposit  abroad.  The  order  further  amended 
Executive  Order  No.  6260  of  August  28,  1933,  under  which  citizens 
are  forbidden  to  hold  gold  in  the  United  States.  The  order,  as 
amended,  was  implemented  by  an  amendment  to  the  Treasury  De- 
partment's Gold  Regulations,  which  afforded  existing  American 
holders  of  gold  abroad,  and  of  securities  representing  gold  on  deposit 
abroad,  a  reasonable  period  of  time  until  June  1,  1961,  to  dispose  of 
their  holdings.  The  prohibition  of  such  holdings  abroad,  where 
purchases  generallj^  represent  an  outflow  in  the  U.S.  balance  of 
payments,  underlines  the  fact  that  gold  today  represents  principally 
a  means  of  settling  international  payments  between  individual  foreign 
countries.  The  amendment  of  the  Executive  order  was  undertaken 
within  the  administration's  comprehensive  program  to  work  toward 
equilibrium  in  the  U.S.  balance  of  payments. 

Foreign  exchange  stabilization  operations 

Operations  in  exchange  markets. — Under  the  conditions  of  converti- 
bility of  the  major  world  currencies,  international  money  markets 
have  again  become  closely  interconnected,  and  liquid  funds  are  free 
to  flow  in  large  volume  between  these  markets  in  response  to  differ- 
entials in  interest  rates  and  speculative  considerations.  When 
interest  rates  in  the  United  States  and  Europe  diverged  substantially 
in  mid-1960,  a  broad  stream  of  short-term  capital  moved  from  New 
York  to  London  and  other  European  money  centers  in  search  of 
higher  short-term  rates.  The  magnitude  of  this  capital  movement 
resulted  in  an  appreciable  increase  in  the  outflow  of  gold  from  the 
United  States.     This  in  turn  brought  on  a  speculative  outbreak  in 


REVIEW    OF    FISCAL    OPERATIONS  121 

the  private  gold  market  in  London  in  October  1960.  When  European 
authorities  lowered  their  discount  rates,  the  flow  of  short-term  capital 
slowed  and  confidence  was  gradually  restored. 

In  accordance  with  the  President's  balance-of-payments  program, 
the  United  States  took  the  initiative  in  developing  a  framework  for 
close  consultation  with  European  authorities  to  discuss  financial  ques- 
tions of  mutual  mterest,  including  the  disequilibrating  movements  of 
liquid  funds.  In  April  1961a  worldng  party  on  international  payments 
problems  was  established  as  a  subcommittee  of  the  Economic  Policy 
Committee  of  the  Organization  for  European  Economic  Cooperation. 
This  worldng  party  continues  within  the  new  Organization  for  Eco- 
nomic Cooperation  and  Development.  Under  Secretary  for  Monetary 
Affairs  Robert  V.  Roosa  headed  the  U.S.  delegation  to  meetings  of 
this  group  in  April  and  May. 

Following  the  revaluations  of  the  German  mark  and  the  Dutch 
guilder  in  early  March  1961,  the  United  States  decided  to  undertake 
limited  operations  in  forward  exchange  markets  to  contain  speculative 
movements  of  capital  and  prevent  them  from  forcing  either  an  un- 
desirable and  unnecessary  change  in  exchange  rates  or  a  reversion  to 
exchange  controls. 

In  addition  to  these  new  operations  in  the  forward  market,  the 
Treasury,  through  the  facilities  of  the  Federal  Reserve  S3-stem,  and 
in  cooperation  with  authorities  abroad,  also  began  to  acquire  modest 
holdings  of  foreign  exchange  which  could  be  sold  in  the  spot  market 
should  the  dollar  again  come  under  pressure.  The  United  States  thus 
acquired  some  deutsche  mark  in  connection  with  the  prepayment  by 
Germany  of  $587  million  of  its  official  debt  to  the  United  States.  The 
Treasury  also  acquired  certain  other  convertible  currencies.  In  order 
to  indicate  clearly  the  increased  strength  and  flexibility  of  the  U.S. 
reserve  position,  the  Treasury  now  includes  holdings  of  convertible 
foreign  exchange  as  w^ell  as  gold  in  the  reports  of  U.S.  monetarj^  assets 
(see  table  113). 

Treasury  exchange  and  stabilization  agreements. — During  the  fiscal 
year  the  Treasury  exchange  agreement  with  Argentina  was  renewed 
and  exchange  agreements  with  Chile  and  Brazil  were  signed.  As  of 
June  30,  1961,  agreements  were  in  force  with  four  countries,  Argentina, 
Brazil,  Chile,  and  Mexico,  in  the  total  amount  of  $210  miUion. 

The  $50  million  exchange  agreement  with  Argentina  was  renewed 
for  an  additional  year  on  January  0,  1961.  (See  exhibit  30.)  Under 
this  agreement  Argentina  may  request  the  U.S.  Exchange  Stabilization 
Fund  to  purchase  Argentine  pesos  which  must  subsequenth'  be  re- 
purchased by  Ai-gentina  with  doUars.  In  1959  the  Exchange  Stabi- 
lization Fund  purchased  the  equivalent  of  $25  million  in  Argentine 
pesos  for  U.S.  dollars.     During  the  fiscal  year  the  Central  Bank  of 


122   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Argentina  repurchased  $11  million  in  Argentine  pesos,  leaving  an 
outstanding  balance  of  $14  million  as  of  June  30,  1961. 

On  February  10,  1961,  a  $15  million,  one-year  exchange  agreement 
was  signed  with  Chile.  (See  exhibit  31.)  Concurrent  announcements 
were  made  of  agreements  for  additional  support  from  other  public 
and  private  sources,  including  a  $16  million  dramng  from  and  a  $75 
million  standby  arrangement  with  the  International  Monetary  Fund, 
a  $15  million  Export-Import  Bank  credit,  and  $30  million  in  short- 
term  credits  from  a  group  of  private  U.S.  banks. 

A  two-year,  $70  million  exchange  agreement  with  Brazil  was  an- 
nounced on  May  17,  1961,  as  a  part  of  financial  facilities  provided 
Brazil  by  the  United  States,  the  International  Monetary  Fund,  and 
various  European  countries.  (See  exhibit  23.)  New  U.S.  credits 
were  announced,  totaling  $338  million  including:  $168  million  from 
the  Export-Import  Bank,  $100  million  from  the  new  aid  agency,  subject 
to  congressional  authorization,  and  the  $70  million  Treasury  exchange 
agreement.  Brazilian  payments  to  the  Export-Import  Bank  of 
approximately  $305  million  were  also  rescheduled.  Simultaneous 
announcement  was  made  of  an  agreement  with  the  International 
Monetary  Fund  for  a  standby  arrangement  of  $160  million  and  for 
rescheduling  of  $140  million  of  Brazilian  obligations  to  the  Fund. 
Subsequent  negotiations  \\dth  European  countries  resulted  in  arrange- 
ments for  rescheduling  of  existing  indebtedness,  increases  of  short- 
term  bank  credit  lines,  and  arrangements  for  new  standby  credits. 

The  International  Monetary  Fund. — Financial  assistance  extended 
by  the  International  Monetary  Fund  during  the  fiscal  year  totaled 
$567  million,  taldng  the  form  of  dramngs  by  21  members,  against 
their  quotas  in  the  Fund,  of  the  currencies  of  other  members  needed 
to  assist  in  meeting  an  unbalanced  payments  position.  Nearly  all 
drawings  were,  as  in  other  recent  years,  under  standby  arrangements 
negotiated  in  advance  with  the  Fund  whereby  the  Fund  assures  the 
member  that  drawings  up  to  specified  amounts  during  a  specified 
period  may  be  made,  usually  without  further  consultation.  As  during 
the  previous  fiscal  year,  when  member  drawings  amounted  to  $247 
million,  the  call  upon  the  Fund's  resources  reflected  the  persistent 
payments  problems  of  nonindustrial  countries,  and  most  drawings 
were  made  in  connection  with  stabilization  programs  newly  adopted 
or  continued  as  the  result  of  Fund  consultations.  As  of  June  30, 
1961,  there  were  in  effect  16  standby  arrangements  providing  poten- 
tially about  $709  million,  of  which  $552  milhon  remained  available 
to  the  countries  participating.  Repurchases  by  member  countries 
against  earlier  drawings,  and  other  membei-s'  dramngs  which  had 
the  effect  of  repurchases,  resulted  in  total  repayments  of  about  $589 
million  during  the  fiscal  year.     While  over  half  represented  the  com- 


REVIEW    OF    FISCAL    OPERATIONS  123 

pletion  of  repayments  by  the  United  Kingdom  and  France,  a  sub- 
stantial amount  was  repaid  by  nonindus trial  countries. 

For  the  first  time  in  any  comparable  period  the  amount  of  U.S. 
dollars  drawn  ($192  million)  was  smaller  than  the  amount  of  other 
currencies  drawn  ($375  million).  In  December  1958  the  major 
nondollar  currencies  had  been  made  externally  convertible  and  there- 
by became  more  useful  to  other  countries  in  financing  international 
transactions;  as  a  consequence  some  of  these  currencies  began  to  be 
drawn  more  widely  from  the  Fund. 

During  the  current  fiscal  year,  in  February  and  March  1961,  eleven 
member  countries  agreed  formally  to  give  up  the  transitional  arrange- 
ments provided  in  the  Fund  Articles  of  Agreement  and  to  accept  all 
of  the  obligations  of  Article  VIII,  including  approval  of  the  Fund 
prior  to  imposing  restrictions  on  pajmients.  Thus  at  the  present 
time  nearly  all  currencies  used  to  finance  international  trade  and  pay- 
ments are  under  Article  VIII  and  may  be  used  to  make  repayments 
to  the  Fund. 

During  the  fiscal  year  the  Fund  began  to  hold  periodic  voluntary 
discussions  with  member  countries  which  have  accepted  the  obliga- 
tions of  Article  VIII.  The  United  States  has  agreed  to  participate 
in  these  consultations,  which  provide  an  opportunity  for  the  Fund, 
as  well  as  for  the  member,  to  exchange  views  on  the  course  of  domestic 
and  international  financial  developments,  looking  toward  a  greater 
degree  of  monetary  cooperation  among  countries  whose  currencies 
are  used  in  international  transactions.  Also  during  this  period  the 
Fund  clarified  the  meaning  of  the  Articles  of  Agreement  with  respect 
to  the  use  of  Fund  resources  for  helping  to  meet  those  deficits  in  the 
balance  of  payments  of  members  that  go  beyond  the  current  account 
and  are  attributable,  in  whole  or  in  part,  to  capital  transfers.  It  was 
agreed  that,  in  accordance  with  Article  VI  and  the  other  provisions 
of  the  Articles,  the  Fund's  resources  can  be  used  for  mitigating  the 
unfavorable  eft'ects  of  capital  transfers. 

Programs  for  financing  economic  development 

The  Act  j or  International  Development. — On  September  4,  1961,  the 
Congress  approved  legislation  providing  a  new  framework  and  new 
goals  for  U.S.  foreign  aid.  The  Act  for  International  Development  of 
1961  (Part  I  of  Public  Law  87-195,  22  U.S.C.  2151)  was  enacted  on  the 
basis  of  reconnnendations  by  the  President  in  his  special  foreign  aid 
message  to  the  Congress  on  March  22,  1961,  and  his  subsequent 
submission  of  detailed  legislative  proposals.  Among  the  primary 
reasons  for  seeking  the  new  legislation  was  the  desire  to  center  in  a 
single  agency  the  responsibility  of  administering  assistance  in  a  variety 
of  forms  in  support  of  long-range  development  programs,  based  upon 
the  self-help  efforts  of  the  developing  countries  themselves.     The 

614359—62 9 


124   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

development  lending  provisions  of  the  act  require  that  dollar  loans  be 
repaid  exclusive!}^  in  dollars,  although  other  terms  may  be  flexible. 
The  Secretary  appeared  before  the  Senate  Foreign  Relations  Com- 
mittee on  June  5,  1961,  and  before  the  House  Foreign  Affairs  Com- 
mittee on  June  21,  1961,  in  support  of  this  legislation.  (See  exhibit 
24.) 

The  administrative  provisions  of  the  new  legislation  provide  for  the 
abolition  of  the  Development  Loan  Fund  as  a  corporate  entity  and  of 
the  International  Cooperation  Administration.  The  Secretary  of 
State,  under  the  direction  of  the  President,  is  to  be  responsible  for  the 
continuous  supervision  and  general  direction  of  the  assistance  pro- 
grams authorized  by  the  act;  the  primary  responsibility  for  administer- 
ing development  loans,  grants,  technical  cooperation,  investment 
guarantees,  and  other  development  and  supporting  assistance  under 
the  new  legislation  is  to  be  placed  within  the  newly  formed  Agency  for 
International  Development.  Loans  of  foreign  currencies  formerly 
made  by  the  Export-Import  Bank  pursuant  to  section  104(e)  of  the 
Agricultural  Trade  Development  and  Assistance  Act  of  1954,  as 
amended  (7  U.S.C.  1704(e)),  will  also  be  administered  by  the  new 
Agency. 

The  Alliance  jor  Progress. — ^At  a  White  House  reception  for  Am- 
bassadors of  the  Latin  American  countries  on  March  13,  1961,  Presi- 
dent Kennedy  called  upon  the  people  of  the  hemisphere  to  join  in  an 
''Alliance  for  Progress,"  a  cooperative  effort  to  satisfy  basic  needs  for 
homes,  work,  land,  health,  and  schools.  He  proposed  that  the  Latin 
American  governments  formulate  long-term  development  plans,  sug- 
gested further  cooperation  m  the  areas  of  commodity  problems  and 
economic  integration,  called  for  continued  cooperation  in  hemispheric 
defense  and  anns  control,  and  proposed  an  expansion  of  the  food  for 
peace  program  and  of  scientific,  technical,  and  cultural  exchanges. 
He  indicated  that  he  expected  shortly  to  ask  for  convocation  of  a 
special  meeting  of  the  Inter- American  Economic  and  Social  Council 
at  the  ministerial  level.  The  President  referred  to  his  request  for 
appropriations  under  the  legislation  approved  on  September  8,  1960 
(22  U.S.C.  1942),  which  authorized  $500  million  for  an  Inter-American 
Program  for  Social  Progress  (and  which  also  authorized  $100  million 
for  reconstruction  in  Chile  of  facilities  damaged  by  earthquake). 
(See  exhibit  28.)  This  legislation  had  enabled  the  U.S.  delegation  to 
assume  the  initiative  in  discussions  about  social  and  economic  develop- 
ment at  the  third  meeting  of  the  Special  Committee  of  the  Organization 
of  American  States  held  in  Bogota,  Colombia,  in  September  1960. 

On  March  14,  1961,  the  President  transmitted  a  message  to  the 
Congress  requesting  the  appropriation  of  the  $500  million  authorized 
for  the  Inter- American  social  progress  program.     He  proposed  that 


REVIEW    OF    FISCAL    OPERATIONS  125 

$394  million  be  administered  by  the  Inter-American  Development 
Bank,  that  $100  million  be  allocated  to  the  International  Cooperation 
Administration  or  its  successor,  and  that  $6  million  be  made  available 
for  use  by  the  Organization  of  American  States.  Secretary  Dillon 
appeared  before  the  Foreign  Operations  Subcommittee  of  the  House 
Appropriations  Committee  on  March  20,  1961,  and  before  the  Senate 
Appropriations  Committee  on  April  28,  1961,  in  support  of  the  request. 
(See  exhibit  20.)  The  appropriation  bill  (PubHc  Law  87-41)  was 
signed  on  May  27,  1961.  The  administration  of  the  $394  million  was 
entrusted  to  the  Inter-American  Development  Bank  under  the  Social 
Progress  Trust  Fund  Agreement,  which  was  signed  by  President 
Kennedy  and  Mr.  Felipe  Herrera,  President  of  the  Bank,  on  June 
19,  1961. 

The  Special  Meeting  of  the  Inter-American  Economic  and  Social 
Council  at  the  Ministerial  Level  met  at  Punta  del  Este,  Uruguay,  in 
August.  The  U.S.  delegation  was  headed  by  Secretary  Dillon. 
Major  items  on  the  agreed  agenda  of  the  conference  were:  Planning 
for  economic  and  social  development,  Latin  American  economic  inte- 
gration, export  commodity  market  problems,  annual  review  (progress 
reports  on  economic  and  social  development),  and  information  and 
public  relations.  The  Charter  of  Punta  del  Este,  formulated  at  the 
conference,  defined  the  aims  of  the  Alhance  for  Progress  and  set  forth 
the  major  goals  for  a  ten-year  program  of  social  and  economic  progress 
in  Latin  America,  involving  internal  reforms  and  public  and  private 
help  from  outside  sources. 

The  Inter -American  Development  Bank. — The  Inter-American  De- 
velopment Bank,  in  which  the  United  States  and  all  the  Latin  Amer- 
ican Republics  except  Cuba  have  become  members,  commenced  its 
business  operations  on  October  1, 1960.  Under  its  ordinary  operations, 
the  Bank  is  empowered  to  assist  in  financing  productive  economic  de- 
velopment projects  through  loans  repayable  in  the  currency  lent. 
The  resources  of  the  Fund  for  Special  Operations  are  available  for 
loans  on  terms  and  conditions  appropriate  for  dealing  with  special 
circumstances  arising  in  particular  countries  or  with  respect  to  specific 
projects.  In  addition  to  direct  loans  and  guarantees,  an  important 
function  of  the  Bank  is  to  provide  technical  assistance  for  the  prepa- 
ration, financmg,  and  implementation  of  development  plans  and 
projects. 

The  Bank  will  have  resources  equivalent  to  $959.5  million,  includmg 
$381.6  million  in  paid-in  capital,  $431.6  million  in  callable  capital, 
and  $146.3  million  in  contributions  to  the  Fund  for  Special  Operations. 
Half  of  the  subscriptions  to  ordinary  capital  and  of  the  contributions 
to  the  Fund  for  Special  Operations  are  payable  in  gold  and/or  U.S. 
dollars,  and  half  in  the  currency  of  the  member  country.     The  sub- 


126   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

scriptions  to  paid-in  capital  are  payable  in  three  installments  of  20 
percent,  40  percent,  and  40  percent  respectively.  The  contributions 
to  the  Fund  for  Special  Operations  are  payable  in  two  equal  install- 
ments. The  first  installments,  both  on  subscriptions  to  capital  and 
on  contributions  to  the  Fund,  were  payable  by  September  30,  1960. 
(The  United  States  paid  its  installments,  totaling  $80  million,  in 
June  1960.)  The  second  installment  on  subscriptions  to  capital,  and 
the  second  half  of  contributions  to  the  Fund  were  due  October  31, 
1961,  and  the  final  installment  of  40  percent  of  capital  subscriptions 
will  be  due  October  31,  1962.  An  appropriation  of  $110  million  to 
meet  the  required  U.S.  payments  due  October  31,  1961,  was  contained 
in  the  foreign  aid  appropriation  bill  approved  by  the  Congress  on 
September  30,  1961  (Public  Law  87-329).  (The  United  States  paid 
its  installments  in  October  1961.) 

Secretary  Dillon,  as  U.S.  Governor,  headed  the  U.S.  delegation  to 
the  Second  Meeting  of  the  Board  of  Governors  of  the  IDB,  held  in 
Rio  de  Janeiro,  Brazil,  April  10-14,  1961.  (See  exhibit  19.)  The 
delegation  included  Assistant  Secretary  of  the  Treasury  John  M, 
Leddy  and  Assistant  Secretarj^  of  State  for  Economic  Affairs  Edwin 
M.  Martin  as  Temporary  Alternate  Governors,  and  Special  Assistant 
to  the  Secretary  of  the  Treasury  Robert  Cutler  (the  U.S.  Executive 
Director  of  the  IDB).  The  delegation  also  included  the  chairman 
and  a  member  of  the  Committee  on  Foreign  Relations  of  the  Senate, 
members  of  the  House  Banking  and  Cm-rency  Committee,  the 
President  of  the  Export-Import  Bank,  other  officials  of  the  executive 
branch,  and  the  U.S.  Ambassador  to  Brazil. 

The  IDB  announced  its  first  loan  on  February  3,  1961,  and  approved 
12  loans  from  its  ordinary  capital  resources  and  7  loans  from  its  Fund 
for  Special  Operations  during  the  period  ending  June  30,  1961.  Its 
total  lending  operations,  equivalent  to  $70  million,  assisted  in  financing 
projects  in  12  member  countries.  U.S.  commercial  banks  participated 
in  the  aggregate  amount  of  $1.9  million  in  a  number  of  the  loans  made 
from  the  ordinary  capital  resources. 

The  Export-Import  Bank. — In  fiscal  1961  the  Export-Import  Bank 
authorized  new  credits  and  guaranties  totaling  $1.4  billion  to  85 
countries — an  amount  over  twice  that  authorized  in  the  preceding 
fiscal  year  period,  and  the  largest  amount  committed  in  any  such 
period  since  1946.  Approximately  54  percent  of  total  authorizations 
were  to  Latin  American  countries.  In  addition  to  those  loans  and 
guaranties,  the  Bank  also  approved  $147  million  in  allocations  under 
credits  previously  approved.  The  Bank's  loans  are  intended  to  assist 
in  financing  the  export  sale  of  U.S.  industrial  or  agricultural  equip- 
ment, consumer  durable  goods,  materials  and  services,  with  repay- 
ment in  U.S.  dollars  on  terms  appropriate  to  the  item  purchased. 


REVIEW    OF    FISCAL    OPERATIONS  127 

In  fiscal  1961,  the  Bank  had  a  gross  income  of  $138.5  million.  Interest 
paid  to  the  Treasm-y  on  borrowed  money  was  $42.8  million,  and 
operating  expenses  were  $2.5  million.  Thus,  the  net  income  for  the 
period  was  $93.1  million.  In  June  the  Bank  declared  a  dividend  of 
$30  million  on  the  stock  of  the  Bank  held  by  the  Secretary  of  the 
Treasury.  From  its  inception  in  February  1934  through  June  30, 
1961,  loan  and  guaranty  authorizations  of  the  Bank  totaled  $12.1 
billion.  Disbursements  were  $7.8  billion,  of  which  $4.4  billion  had 
been  repaid.  The  Bank's  uncommitted  lending  authority  on  June 
30,  1961,  was  $1,312  million. 

Pursuant  to  section  104(e)  of  the  Agricultural  Trade  Development 
and  Assistance  Act  of  1954,  as  amended,  the  Bank  during  fiscal  1961 
authorized  45  loans  in  the  currencies  of  11  countries  for  a  total  amount 
equivalent  to  $25.1  million.  Since  the  amendment  of  Public  Law  480 
in  August  1957  (7  U.S.C.  1704(e)),  the  Bank  has  authorized  a  total  of 
163  such  loans  in  the  currencies  of  17  countries  in  the  equivalent  of 
approximately  $92  million. 

In  February  1961  the  President,  in  his  message  to  the  Congress  on 
balance  of  payments  and  gold,  directed  the  Bank  to  prepare  and 
submit  to  the  Secretary  of  the  Treasury,  as  Chairman  of  the  National 
Advisory  Coimcil  on  International  Monetary  and  Financial  Problems, 
a  new  program  under  the  Bank  to  place  U.S.  exporters  on  a  basis  of 
full  equality  with  their  competitors  in  other  comitries.  With  the 
approval  of  the  National  Advisory  Council,  the  Bank,  on  March  24, 
1961,  announced  the  availability  of  new  forms  of  guaranties  and 
financing  for  U.S.  exports.  The  Bank  also  annomiced  that  it  would 
devise  a  system  to  guarantee  short-  and  medium-term  export  credit 
transactions.  Negotiations  were  carried  out  for  an  agreement  with  a 
group  of  leading  private  insurance  companies  mider  which  the  com- 
panies would  issue  export  credit  insm*ance  to  be  underwritten  jointly 
by  them  and  the  Export-Import  Bank.  In  addition,  a  program  was 
prepared  whereby  the  Export-Import  Bank  would  issue  a  new  system 
of  guaranties  directly  to  the  commercial  banks  and  those  financial 
institutions  undertaking  nonrecourse  financing  of  exports.  The  two 
programs  were  annomiced  by  the  President  on  October  27,  1961. 
(See  exhibit  16.) 

The  Development  Loan  Fund. — During  the  period  under  review,  the 
Development  Loan  Fund  continued  to  be  the  principal  instrument  of 
the  mutual  secm-ity  program  for  stimulating  economic  growth  in  the 
less-developed  countries  of  the  world.  Through  its  authority  to 
provide  financing  on  flexible  terms,  the  DLF  has  been  able  to  adapt 
its  repayment  requirements  to  the  capacity  of  the  less-developed 
countries.  These  requirements  have  often  included  provision  for 
repayment  m  the  currency  of  the  borrower.     In  fiscal  1961,  the  DLF 


128   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

approved  61  loans  and  other  commitments  totaling  $653  million  in  83 
countries.  Since  its  creation  in  1957  the  DLF  has  approved  through 
June  30,  1961,  a  total  of  212  loans,  guaranties,  and  allocations  in  50 
countries,  totaling  over  $2  billion.  Cumulative  disbm*sements  under 
approved  loans  amounted  to  $538  million. 

The  International  Bank. — During  fiscal  1961  the  International  Bank 
made  27  loans  totaling  $610  million  in  20  member  countries  and  ter- 
ritories, bringing  the  total  number  of  loans  to  292  in  57  countries  and 
territories.  Disbursements  under  loans  were  $398  million,  substan- 
tially lower  than  the  $544  million  and  $583  milhon  m  the  two  preced- 
ing years.  Many  of  the  recent  projects  have  been  large  ones  with 
longer  completion  dates,  thus  accounting  for  an  increase  in  the  average 
disbursement  period  from  two  or  three  years  to  about  five  j^ears. 

Participations  by  private  investors,  and  sales  from  the  Bank's 
portfolio,  all  without  the  Bank's  guaranty,  amounted  to  $202  million. 
Repayments  by  borrowers  from  the  Bank  totaled  $191  million,  in 
eluding  $101  million  to  the  Bank  and  $90  million  to  other  holders  of 
Bank  loans.  The  Bank's  need  for  outside  funds  during  the  year  was 
relatively  small,  and  the  Bank's  funded  debt  rose  by  only  $155  mil- 
lion to  a  total  of  $2,228  million  as  of  June  30,  1961.  All  of  the  bor- 
rowings during  the  year  took  place  outside  the  United  States,  and  it 
is  estimated  that  some  53  percent  of  the  debt  outstanding  on  June  30, 
1961,  was  held  outside  the  United  States. 

The  cumulative  total  of  Bank  loans,  net  of  cancellations  and  re- 
fundings,  was  $5,669  million  as  of  June  30,  1961,  of  which  $4,320  mil- 
lion had  been  disbursed.  Principal  repayments  to  the  Bank  amounted 
to  $438  million,  and  loans  sold  or  agreed  to  be  sold  totaled  $1,013 
million.  Alore  than  two- thirds  of  the  Bank's  lending  is  for  electric 
power  and  transportation.  Although  in  past  years  electric  power 
was  the  more  important,  transportation  is  becoming  more  significant 
and  in  fiscal  1961  accounted  for  slightly  more  than  half  of  the  total 
Bank  loans. 

The  Indus  Waters  Treaty,  1960,  was  signed  on  September  19,  1960, 
and  simultaneously  an  international  financial  agreement  was  executed 
to  create  an  Indus  Basin  Development  Fund  to  finance  irrigation  and 
other  works  in  Pakistan.  The  Fund  will  be  administered  b}^  the 
International  Bank.  (See  the  Annual  Report  for  1960,  pp.  65  and  66.) 
Work  has  begun  on  projects  included  in  the  ten-year  settlement  plan 
including  preliminary  construction  and  invitations  for  tenders  on 
major  segments  of  the  plan. 

The  International  Bank  continued  to  sponsor  meetings  of  a  con- 
sortium of  countries  to  discuss  assistance  for  the  development  plans 
of  India  and  Pakistan.  The  fourth  meeting  of  the  consortium  con- 
cerning India  was  held  in  April  and  June  1961,  and  was  attended 


REVIEW    OF    FISCAL    OPERATIONS  129 

by  representatives  of  the  United  States,  Canada,  Germany,  Japan, 
and  the  United  Kingdom.  France  joined  the  consortium  as  a  mem- 
ber during  the  meeting,  and  Austria,  Denmark,  Norway,  and  Sweden 
sent  observers.  The  U.S.  delegation  was  headed  by  Assistant  Secre- 
tary John  M.  Leddy.  At  this  session  the  members  of  the  consortium 
undertook  commitments  of  aid  to  India  totaling  over  $2  bilhon.  The 
consortium  interested  in  Pakistan  met  in  early  June  1961,  with 
representatives  and  observers  from  the  same  governments  which  partic- 
ipated in  the  fourth  meeting  of  the  Indian  consortium.  France  also 
joined  this  consortium  as  a  member  during  the  meeting.  Commit- 
ments made  at  the  meeting  totaled  $550  million,  including  $230 
million  in  aid  previously  committed  by  members  for  Pakistan. 

The  International  Development  Association. — Secretary  of  the  Treas- 
ury Robert  B.  Anderson,  on  behalf  of  the  President,  signed  the 
Articles  of  Agreement  of  the  International  Development  Association 
on  August  9,  1960  (see  exhibit  29),  and  the  Agreement  entered  into 
force  on  September  24,  1960.  The  Association,  an  affiliate  of  the  In- 
ternational Bank,  officially  began  operations  on  November  8.  Its 
first  development  credit  agreement,  $9  million  for  highway  develop- 
ment in  Honduras,  was  signed  on  May  12,  1961.  By  June  30,  three 
additional  credits  had  been  extended:  $13  million  for  the  Roseires 
Dam  project  in  Sudan,  a  joint  IDA-International  Bank  operation 
under  which  the  IBRD  agreed  to  lend  $19.5  million  and  in  which  the 
Federal  Republic  of  Germany  participated  by  providing  a  loan 
equivalent  to  $18.4  million;  $19  million  for  a  highway  project  in  Chile, 
jointly  with  an  International  Bank  loan  of  $6  million;  and  $60  million 
for  a  highway  project  in  India. 

As  of  June  30,  1961,  membership  in  the  IDA  included  51  countries 
having  total  initial  subscription  commitments,  payable  over  a  five-year 
period,  of  about  $906  million.  All  members  of  the  Internationa]  Bank, 
numbering  68  as  of  June  30,  are  eligible  to  join  the  IDA.  "Part  I" 
members,  the  United  States  and  the  14  other  more  economically 
advanced  countries  included  within  its  membership,  pay  all  subscrip- 
tions in  convertible  currencies  usable  for  any  development  credits 
extended  by  IDA;  the  remaining  36  members,  the  "Part  II"  countries, 
subscribe  10  percent  in  convertible  funds  and  the  remainder  in  their 
own  currencies  usable  for  credits  only  with  their  consent.  Pursuant 
to  the  schedule  for  the  payment  of  subscription  installments,  the 
United  States  paid  in  $73.7  million  at  the  time  the  obligations  of 
membership  were  assumed.  These  funds  had  been  appropriated  for 
the  purpose  by  the  Congress,  and  later  in  the  fiscal  year  request  was 
made  for  an  additional  $61.7  million  to  pay  the  second  installment  on 
the  U.S.  subscription  coming  due  in  November  1961.  Provision  for 
such  payment  was   included  in   the   foreign   aid   appropriation  bill 


130    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

approved  by  the  Congress  on  September  30,  1961  (Public  Law  87- 
329).  The  balance  of  the  initial  U.S.  subscription  is  payable  in  three 
additional  annual  installments  of  $61.7  million. 

The  International  Finance  Corporation. — Nine  new  investments 
totaling  $6.2  million  in  seven  member  countries  were  made  by  the 
Corporation  during  the  fiscal  year.  As  of  June  30,  1961,  the  IFC 
had  net  commitments  outstanding  of  $44.4  million,  resulting  from  40 
investments  in  18  countries.  Sales  of  investments  and  participations 
in  investments  had  reached  a  total  of  $8.9  million,  such  sales  having 
amounted  to  $3.5  million  during  the  year.  At  the  end  of  the  period, 
subscriptions  by  the  59  member  countries  totaled  $96.6  million. 

In  February  1961  a  proposal  to  amend  the  Articles  of  Agreement  of 
the  Corporation  to  enable  investment  in  capital  stock  was  formally 
submitted  to  the  Board  of  Governors.  A  favorable  U.S.  vote  on  this 
proposal,  which  had  been  under  discussion  for  some  months,  required 
amendment  of  the  International  Finance  Corporation  Act  (22  U.S.C. 
282),  and  the  administration  requested  the  necessary  legislation. 
Secretary  of  the  Treasury  Dillon,  as  U.S.  Governor  of  the  Corporation, 
appeared  before  a  Subcommittee  of  the  House  Banking  and  Currency 
Committee  on  behalf  of  the  legislation  on  May  10,  1961.  (See  exhibit 
22.)  The  legislation  was  approved  on  August  30,  1961  (22  U.S.C. 
282(c)),  and  on  September  5,  1961,  the  President  of  the  IFC  announced 
that  the  required  votes  for  adoption  of  the  resolution  amending  the 
Articles  of  Agreement  had  been  received.  At  the  annual  meeting  of 
the  Governors  of  the  IFC,  held  in  conjunction  with  the  meetings  of 
the  International  Monetary  Fund,  the  International  Bank,  and  the 
International  Development  Association  in  Vienna,  Austria,  in  Septem- 
ber 1961,  Assistant  Secretary  John  M.  Leddy,  as  U.S.  Director  and 
Temporary  Alternate  Governor  of  the  IFC,  noted  that  the  amendment 
to  the  Articles  permitting  investment  in  equities  would  enable  the 
Corporation  to  operate  with  a  greater  degree  of  flexibility  and  so  more 
readily  assist  the  investment  of  private  capital  and  the  development 
of  private  enterprise  of  the  less-developed  countries  (see  exhibit  27). 
He  also  paid  tribute  to  the  retiring  President  of  the  IFC,  Robert  L. 
Garner,  who  had  held  that  office  since  the  IFC  had  come  into  existence 
in  July  1956. 

U.S.  private  investments.— The  amount  of  U.S.  private  investments 
abroad  increased  by  more  than  $5  billion  during  the  calendar  year 
1960,  and  totaled  over  $50  billion  by  the  end  of  the  year.  U.S. 
direct  investments  abroad  accounted  for  about  60  percent  of  these 
amounts,  increasing  by  nearl}^  $3  billion  during  the  year  and  amount- 
ing to  $32.7  billion  on  December  31.  Long-term  portfolio  investments 
increased  by  $1.2  billion,  about  the  same  as  in  1959,  and  were  valued 
at  $12.6  billion  at  yearend.    Short-term  portfolio  investments  rose  by 


REVIEW    OF    FISCAL    OPERATIOlSrS  131 

slightly  more  than  $1.3  billion  diu'ing  the  year  to  a  total  of  $4.9 
billion. 

The  flow  of  direct  investments  to  Em'ope  (including  reinvested 
subsidiary  earnings),  which  had  increased  by  $325  ^  million  in  1959 
to  an  annual  rate  of  $750  ''  million,  rose  by  another  half-billion 
dollars  in  1960  to  an  annual  figure  of  $1.3  billion.  Two-thirds  of  the 
$435  million  investment  in  Common  Market  countries  in  1960  was 
attributable  to  manufacturing.  An  extraordinarily  large  capital 
flow  to  the  United  Kingdom  of  $700  million  included  cash  expenditures 
for  the  acquisition  of  minority  interests  in  subsidiaries.  Direct  in- 
vestment flows  to  Canada  increased  at  a  slower  rate  than  in  1959, 
but  nevertheless  amounted  to  $860  miUion.  Flows  to  Latin  America 
dropped  from  $420  "^  million  to  $310  million,  a  result  in  large  part  of 
the  cessation  of  investment  in  Cuba. 

Other  international  organizations  and  conferences 

The  Organization  for  Economic  Cooperation  and  Development. — Dur- 
ing February  and  March  1961,  the  Secretary  appeared  before  the 
Senate  Foreign  Relations  Committee  to  support  ratification  by  the 
United  States  of  the  Convention,  signed  in  Paris  on  December  15, 
1960,  establishing  the  Organization  for  Economic  Cooperation  and 
Development  (OECD) ,  the  successor  to  the  Organization  for  European 
Economic  Cooperation,  in  which  the  United  States  and  Canada  would 
become  full  members.  (See  exhibit  17.)  The  Senate  approved  U.S. 
adherence  to  the  Convention  on  March  16,  1961  (Executive  E),  and 
the  OECD  officially  came  into  existence  on  September  30,  1961. 

The  creation  of  the  OECD  was  suggested  by  the  United  States  in 
1959  in  recognition  of  the  strength  of  Western  Europe,  the  significance 
of  convertibility  of  the  European  currencies,  and  Europe's  growing 
responsibilities  for  supporting  economic  improvement  throughout  the 
free  world.  In  its  association  with  the  OEEC,  the  United  States  par- 
ticipated in  the  work  of  a  number  of  committees  and  had  been  repre- 
sented at  meetings  at  various  levels.  The  Economic  Policy  Com- 
mittee was  particularly  active  during  the  period  under  review,  and 
a  working  party  was  established  under  this  committee  to  analyze  the 
effect  on  international  payments  of  monetary,  fiscal,  and  other  policy 
measures  and  to  consult  on  national  and  international  policy  measures 
as  they  relate  to  international  payments  equilibrium.  The  Develop- 
ment Assistance  Group,  which  was  formed  early  in  1960  to  discuss 
various  aspects  of  cooperation  in  facilitating  the  flow  of  bilateral  long- 
term  capital  to  less-developed  areas,  met  in  Washington  in  March 
and  October  1960,  in  Bonn  in  July  1960,  and  in  London  in  March  1961. 
These  and  other  activities  which  had  been  begun  within  the  framework 


Revised. 


132   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

of  the  OEEC  are  to  be  continued  within  the  OECD.  The  European 
Monetary  Agreement  will  continue  to  function  under  the  OECD, 
although  the  United  States  and  Canada  do  not  participate  in  it. 

The  European  Economic  Community. — The  member  nations  of  the 
European  Economic  Community  (the  Common  Market)  made  further 
progress  during  the  year  toward  the  goal  of  establishing  the  customs 
union  envisaged  by  the  Treaty  of  Rome.  The  first  four-year  stage  of 
this  treaty  ended  December  1961.  Originally,  tariff  reductions  of 
30  percent  were  to  have  been  effected  among  the  six  members  in 
this  period;  but  because  of  an  accelerated  schedule,  tariff  reductions 
of  30  percent  were  in  force  by  January  1,  1961,  and  another  tariff 
cut  of  10  percent  took  place  on  December  31,  1961.  The  first  move 
towards  establishing  a  common  external  tariff  was  made  on  December 
31,  1960.  Germany  and  the  Benelux  countries  increased  their  duties 
on  imports,  while  tariffs  in  Italy  and  France  were  lowered.  Within 
the  Common  Market  quantitative  restrictions  on  industrial  products 
were  eliminated  by  December  31,  1961.  The  removal  of  quotas  on 
other  goods  will  take  place  gradually  until  1970.  Toward  the  close 
of  calendar  1961,  the  United  Kingdom  and  other  members  of  the 
European  Free  Trade  Association  began  to  explore  the  possibilities 
of  becoming  members  of  the  Common  Market. 

The  General  Agreement  on  Tari/ffs  and  Trade. — The  seventeenth  and 
eighteenth  sessions  of  the  Contracting  Parties  to  the  General  Agree- 
ment on  Tariffs  and  Trade  (GATT)  were  held  during  the  fiscal  year. 
The  sessions,  both  of  the  Council  and  of  various  committees  of  GATT, 
dealt  with  a  broad  range  of  problems  affecting  worldwide  trade. 
Representatives  of  the  United  States  used  these  sessions,  as  well  as 
numerous  bilateral  contacts,  to  exert  steady  pressure  for  elimination 
of  unjustifiable  quantitative  restrictions,  especially  those  which 
involve  discrimination  against  U.S.  exports.  Considerable  progress 
was  made  in  the  further  dismantling  of  import  restrictions  generally, 
although  their  use  persists  in  varying  degrees  in  many  parts  of  the 
world,  particularly  in  the  less-developed  countries.  Discrimination 
in  import  restrictions  against  industrial  goods  from  the  United  States 
has  been  reduced  to  relatively  small  proportions.  Discriminatory 
restrictions  on  important  agricultural  products,  however,  have  been 
maintained  by  a  number  of  Western  European  countries.  These 
have  been  a  matter  of  continued  concern  to  the  United  States. 

In  addition  to  the  general  sessions  which  dealt  with  a  broad  range 
of  problems,  a  Tariff  Negotiations  Conference  was  convened  on 
September  1,  1960,  by  the  Contracting  Parties  of  GATT,  at  the  initi- 
ative of  the  United  States.  This  multilateral  tariff  conference,  the 
fifth  of  its  kind,  continued  on  into  the  new  fiscal  year  beginning  July 
1,  1961.     It  has  been  the  largest  and  most  complex  of  the  series. 


REVIEW    OF    FISCAL    OPERATIONS  133 

The  negotiations  with  the  European  Common  Market  countries 
involved  special  difficulties,  mainly  in  relation  to  agricultural  products. 
Particular  interest  has  attached  to  the  efforts  of  the  United  States, 
and  of  other  Contracting  Parties,  to  insure  that  the  Community  will 
establish  commercial  policies  that  will  expand,  rather  than  restrict, 
world  trade.  Negotiations  have,  therefore,  aimed  to  secure  for 
imports  into  the  Common  Market  area  tariff  treatment  which  will 
afford  competitive  access  by  exports  from  the  United  States  and 
from  other  outside  countries. 

Much  effort  was  devoted  during  the  year  to  working  out  inter- 
national arrangements  for  textiles  which  would  enable  the  less- 
developed  countries  and  Japan  to  find  progressively  expanding  market 
opportunities  without  disrupting  conditions  in  import  markets, 
particularly  the  United  States.  This  culminated  in  a  special  meeting, 
held  in  Geneva  in  July  1961,  attended  by  official  representatives  from 
16  countries,  and  by  observers  from  a  number  of  other  countries  and 
various  interested  organizations.  The  meeting  reached  agreement 
upon  a  general  program  of  corrective  action.  A  one-year  interim 
agreement  was  submitted  for  approval  by  the  governments  repre- 
sented in  the  conference,  and  provision  was  made  both  for  negotiations 
aiming  at  a  longrun  agreement  and  for  supplementary  bilateral 
agreements. 

Other  conferences. — Treasury  officers  participated  in  numerous 
conferences  with  representatives  of  many  countries.  Secretary  of  the 
Treasury  Anderson,  accompanied  by  Douglas  Dillon  as  Under  Secre- 
tary of  State,  held  informal  talks  with  German  officials  in  Bonn 
during  November  21-23,  1960.  The  talks  covered  a  broad  range  of 
financial  and  economic  questions,  including  balance-of-payments 
problems,  assistance  to  the  developing  countries,  international  trade, 
and  related  problems  of  mutual  interest.  These  discussions  were 
followed  by  periodic  meetings  at  both  the  ministerial  and  technical 
levels  throughout  the  fiscal  year.  In  April  1961  the  Federal  Republic 
agreed  to  make  an  advance  payment  of  $587  million  against  the  German 
debt  for  United  States  postwar  economic  assistance.  A  number 
of  informal  meetings  were  held  also  with  British  officials,  and  in  April 
1961  Secretary  of  the  Treasury  Dillon  participated  in  the  discussions 
between  the  President  and  the  Prime  Minister.  The  Treasury  was 
represented  also  in  United  States-Canadian  meetings.  Secretary 
Anderson  attended  the  third  meeting  of  the  United  States-Canada 
Ministerial  Committee  on  Joint  Defense  in  Quebec  on  July  12  and  13, 
1960;  Secretary  of  the  Treasury  Dillon  and  Under  Secretary  of  the 
Treasury  Henry  H.  Fowler  participated  in  the  sixth  meeting  of  the 
Joint  United  States-Canadian  Committee  on  Trade  and  Economic 
Affairs  held  in  Washington  on  March  13  and  14,  1961.     On  May  18 


134   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

and  19,  1961,  the  Secretary  met  with  the  Minister  of  Finance  and 
Economic  Affairs  of  France;  subjects  discussed  were  the  general 
economic  situation  and  the  balance-of-payments  trends  in  France  and 
the  United  States,  the  rehitionship  of  the  International  Monetary 
Fund  to  the  problem  of  short-term  capital  movements  under  condi- 
tions of  convertibility,  and  the  need  for  coordination  currently  being- 
developed  in  the  framework  of  the  future  Organization  for  Economic 
Cooperation  and  Development.  Also  during  the  fiscal  year  the 
Treasury  was  represented  on  U.S.  delegations  to  meetings  of  various 
United  Nations  bodies,  the  North  Atlantic  Treaty  Organization,  the 
Southeast  Asia  Treaty  Organization,  the  Colombo  Plan  Organization, 
and  the  Inter-American  Economic  and  Social  Council. 

Lend-lease  silver 

During  World  War  II  the  United  States  transferred  a  total  of  410.8 
milhon  ounces  of  Treasury  silver  to  certain  foreign  countries  under 
authority  of  the  Lend-Lease  Act  of  March  11,  1941.  Although  the 
agreements  differed  somewhat  in  detail,  they  provided  that  the  debtor 
countries  were  to  return  a  like  kind  and  quantity  of  silver  within  five 
years  after  termination  of  the  national  emergency  as  determined  by 
the  President.  Accordingly,  the  lend-lease  silver  was  due  to  be 
returned  by  April  27,  1957,  although  the  agreements  with  several  of 
the  countries  permitted  a  postponement  of  part  of  the  repayment 
for  two  additional  years.  Prior  to  June  30,  1960,  the  entire  amount 
of  silver  due  from  the  Governments  of  Australia,  Belgium,  Ethiopia, 
the  Netherlands,  and  the  United  Kingdom  (also  acting  for  the 
Government  of  the  Fiji  Islands)  had  been  returned  and  taken  into 
the  account  of  the  Treasurer  of  the  United  States.  In  addition,  a 
large  portion  of  the  silver  furnished  during  the  war  under  lend-lease 
for  use  in  undivided  India  had  been  returned  and  taken  into  the 
Treasurer's  account  pursuant  to  arrangements  concluded  in  1957, 
whereby  the  U.S.  Government  agreed  to  a  division  of  liability  for  this 
silver  between  India  and  Pakistan.  (See  the  annual  reports  for  1957, 
pp.  49  and  50;  1958,  pp.  56  and  57;  and  1959,  p.  65.) 

In  the  course  of  fiscal  1961  a  total  of  3.3  million  fine  troy  ounces  of 
silver  consisting  of  1.1  million  ounces  from  India;  0.8  million  ounces 
from  Pakistan;  and  1.4  million  ounces  from  Saudi  Arabia,  was 
returned  and  taken  into  the  account  of  the  Treasurer  of  the  United 
States. 


REVIEW    OF    FISCAL    OPERATIONS 

Lend-lease  silver  transactions  as  of  June  SO,  1961 
[In  millions  of  fine  ounces  except  where  otherwise  specifically  indicated] 


135 


Silver  trans- 
ferred from 
the  Treasury 
to  lend-lease 
for  accoimt 
of  foreign 
governments 

Silver  returned 
and  taken  into 
the  account  of 
the  Treasurer 
of  the  United 
States 

Silver 

being 

returned 

Dollar 
repay- 
ments 
being 
made 

Silver 

to  be 

returned 

Australia 

11.8 

.3 

5.4 

.2 

172.5 

56.7 

53.5 

2  22.3 

88.1 

11.8 

.3 

5.4 

2 

168!  6 

56.7 

35.8 

1.4 

88.1 

Belgium.. 

Ethiopia 

Fiji 

India 

4.0 

Netherlands 

Pakistan 

8.4 

1  9  2 

Saudi  Arabia 

«$8.7 

♦  10  5 

TInitfid  Kingdnm 

Total 

410.8 

368.3 

12.4 

3  8.7 

19  7 

1  Under  an  agreement  concluded  with  Pakistan  in  1957,  the  balance  is  being  returned  in  annual  install- 
ments. 

2  Includes  1,031,250  ounces  lost  at  sea  while  in  transit. 

3  Equivalent  to  9.4  million  fine  troy  ounces  of  silver  converted  on  basis  of  present  market  price.    This 
payment  was  taken  into  the  accounts  of  the  Treasurer  after  June  30, 1961. 

<  PreUminary. 

Foreign  assets  control 

For  the  purpose  of  preventing  Communist  China  from  obtaining 
foreign  exchange  through  the  exportation  of  merchandise  to  the 
United  States,  the  Foreign  Assets  Control  Regulations  prohibit  the 
unlicensed  purchase  and  importation  into  the  United  States  of 
Communist  Chinese  or  North  Korean  merchandise,  as  well  as 
numerous  other  commodities  therein  specified  which  are  of  types  that 
have  historically  come  from  China.  The  Control  does  not  issue 
hcenses  authorizing  importation  of  Chinese-type  merchandise  unless 
satisfactory  evidence  of  its  non-Communist  Chinese  origin  is  presented. 

Importation  under  general  licenses  is  authorized  with  respect  to 
specific  shipments  of  Chinese-type  merchandise  certified  to  be  of 
non-Communist  Chinese  origin  by  the  government  of  a  foreign 
country  from  which  they  were  directly  exported,  provided  that  the 
country  in  question  has  set  up  procedures  for  certification  pursuant  to 
standards  agreed  to  by  the  Treasury  Department.  The  following 
Governments  now  have  such  certification  procedures:  Australia, 
Belgium,  Canada,  Formosa,  France,  the  Federal  Republic  of  Germany, 
Hong  Kong,  India,  Italy,  Japan,  the  Netherlands,  the  Republic  of 
Korea,  Spain,  Switzerland,  and  Vietnam.  Notices  of  the  availability 
of  certificates  of  origin  for  particular  commodities  and  of  the  govern- 
ments prepared  to  issue  them  are  published  from  time  to  time  in  the 
Federal  Register.  During  the  year  a  number  of  additional  items 
became  available  for  certification. 

The  enforcement  measures  of  the  Control  resulted  in  a  number  of 
successful  criminal  prosecutions.  A  total  of  $89,262  was  collected  by 
the  Government  in  forfeitures,  fines,  and  other  penalties  as  a  result 
of  proceedings  under  the  Foreign  Assets  Control  Regulations. 


ADMINISTRATIVE     REPORTS 


Management  Improvement  Program' 

Annual  recurring  savings  resulting  from  recorded  management 
improvements  during  the  fiscal  year  1961  totaled  $8  million  and 
one-time  savings  amounted  to  $2.3  million,  the  highest  figures  in 
recent  years.  Of  these  amounts  over  $3  million  resulted  from  the 
military  and  civilian  incentive  awards  programs.  However,  since 
the  value  of  many  of  the  most  significant  changes  cannot  be  measured 
in  dollars  and  cents,  these  figures  are  only  a  small  indication  of  the 
magnitude  of  the  Treasury's  efforts  to  streamline  its  organization 
and  operations.  A  few  of  the  more  noteworthy  management  improve- 
ments of  the  Treasury  bureaus  are  discussed  in  the  administrative 
reports  of  the  individual  bureaus  found  later  in  this  document. 
Developments  of  a  more  general  nature  ai^e  described  below. 

Mechanization  of  operations 

By  far  the  most  substantial  monetar}?"  savings  have  come  from  the 
continued  mechanization  of  Treasury  operations.  Important  bene- 
fits continue  to  come  from  the  utilization  of  automatic  data  equipment. 
The  Treasury's  entire  disbursing  process,  from  initial  checkwriting  to 
final  reconciliation,  is  being  adapted  to  automatic  data  processing 
methods.  Savings  bonds  now  also  are  processed  electronically.  The 
Internal  Revenue  Service  has  initiated  the  use  of  automatic  data 
processing  equipment  in  processing  tax  returns  and  is  establishing  a 
central  facility  where  information  on  all  taxpayers  and  tax  sources 
will  be  available  by  electronic  means.  Several  of  the  larger  bureaus 
use  electronic  equipment  for  administrative-type  operations,  while 
even  the  smaller  bureaus  are  exploring  means  of  using  this  equipment 
to  improve  their  work  programs  and  administrative  activities.  These 
installations  have  freed  many  Treasury  employees  for  other  work  and 
resulted  in  substantial  savings. 

Personnel  management 

The  Department's  Office  of  Personnel  has  been  reorganized  and 
expanded  to  strengthen  its  effectiveness  in  providing  leadership,  co- 
ordination, and  guidance  to  the  bureaus  on  their  personnel  programs. 
Four  specialized  areas;  employment,  classification  and  wage  adminis- 
tration, employee  relations,  and  training,  have  been  set  up  under  the 
Director  of  Personnel.  In  addition,  the  staff  handling  personnel 
operations  for  the  Office  of  the  Secretary  have  been  transferred  from 
the  Office  of  Administrative  Services  to  the  Office  of  Personnel. 

Goals  have  been  established  which  the  Office  of  Personnel  expects 
to  achieve  through  the  cooperative  efforts  of  the  Treasury  bureaus. 
A  list  of  22  projects  has  been  developed  for  stud}''  by  work  committees 
composed  of  departmental  and  bureau  representatives.  In  order  to 
help  the  smaller  bureaus  without  the  staff"  resources  available  to  the 

'  See  bureau  reports  for  significant  bureau  improvements. 

139 

614S59— 62 10 


140    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

larger  Treasury  organizations,  the  Personnel  Office  plans  to  institute 
personnel  administration  workshops  on  the  development  of  programs 
and  procedures  and  the  improvement  of  operations. 

In  keeping  with  principles  of  maximum  utilization  of  personnel, 
emphasis  in  several  bureaus  has  continued  to  shift  from  meeting 
immediate  training  needs  to  identifying  and  satisfying  career  require- 
ments. Moreover,  throughout  the  Department,  there  has  been  a 
sizable  overall  increase  in  trainmg  activity  to  meet  problems  created 
by  changes  in  worl-doad,  organization,  and  methods.  This  increase 
reflects  a  greater  awareness  and  acceptance  of  training  responsibility 
on  the  part  of  supervisors  and  operating  officials. 

Because  of  the  many  law  enforcement  activities  of  the  Treasury 
Department  and  the  critical  importance  of  its  4,000  enforcement 
agents,  greater  emphasis  was  given  to  basic  and  advance  training  for 
these  employees.  During  fiscal  1961  the  Treasury  Law  Enforcement 
Officers  Training  School  continued  to  improve  its  curriculum  and 
facilities  for  basic  training  of  all  Treasury  agents  and  significant 
improvements  were  made  by  the  Internal  Revenue  Service  in  develop- 
ing comprehensive  advance  training  programs  for  their  agents. 

Executive  development  programs  in  several  bureaus  were  further 
strengthened  by  better  replacement  planning  and  development, 
better  structuring  of  jobs  for  career  purposes,  and  participation  in 
professional  executive  development  courses  and  other  activities  which 
broaden  Ivuowledge  and  increase  skill. 

Financial  management 

Progress  in  improving  financial  practices  and  controls  continued,  a 
complete  account  of  which  may  be  found  in  the  Annual  Report  on 
Financial  Management  Improvement  Activities  for  the  fiscal  year  ended 
June  30,  1961,  obtainable  from  the  Bureau  of  Accounts. 

Standards  were  prepared  for  the  content  and  arrangement  of 
accounting  systems  manuals  to  be  prepared  by  the  Treasury  bureaus, 
and  progress  was  made  in  their  compilation.  Developmental  work  is 
continuing  in  tlie  interest  of  furnishing  management  with  better  and 
more  timely  financial  infonnation  and  otherwise  providing  more  effec- 
tive internal  use  of  cost-based  budgets.  Also,  as  part  of  a  continuing 
program,  the  Department  appraised  the  internal  audit  systems  of  the 
Bureau  of  the  Public  Debt  and  the  Office  of  the  Treasurer  with  a  view 
to  their  improvement. 

In  connection  with  the  Treasury's  Government-wide  responsibility 
for  central  accounting  and  ffiiancial  reporting,  accounts  kept  in 
regional  accounting  offices  were  streamlined  with  estimated  annual 
savings  of  $70,000  resulting.  An  inventory  of  Government-wide 
reports  was  compiled,  and  a  number  of  improvements  suggested  by 
users  were  put  into  effect.  These  studies  and  improvements  were 
made  in  collaljoration  with  the  Bureau  of  the  Budget  and  the  General 
Accounting  Office. 

Property  management 

The  Department  continued  its  vigorous  efforts  to  dispose  of  excess 
real  and  personal  property  promptly  and  to  take  full  advantage  of 
surplus  property  available  from  other  agencies. 


ADMINISTRATIVE    REPORTS  141 

Fourteen  excess  properties,  consisting  of  land  and  improvements 
with  an  acquisition  cost  of  $285,000,  were  declared  excess  to  the 
General  Services  Administration.  Seven  other  properties  previously 
declared  excess  to  the  GSA  were  sold  for  $102,000.  Sixty-eight  parcels 
of  real  propert}^  not  involving  acreage,  with  a  total  acquisition  cost  of 
over  $1  million,  were  disposed  of,  while  75  additional  properties 
involving  an  acquisition  cost  of  $1.8  million  were  reported  to  the  GSA 
for  disposal.  In  addition  to  immediate  monetary  returns,  the  disposal 
of  such  properties  reduced  maintenance  and  protection  costs  to  the 
Treasury. 

Several  Treasury  bureaus  were  moved  into  improved  space  in  new, 
modern  buildings  at  field  locations,  including  Internal  Revenue 
Service  offices  which  were  moved  into  new  buildings  at  11  locations. 

During  the  fiscal  year  the  Treasury  received  from  other  Federal 
agencies  witliout  reimbursement  excess  personal  properties  with  an 
original  acquisition  cost  of  $9.8  million.  In  the  same  period,  personal 
properties  with  an  acquisition  cost  of  $13.6  million  were  determined  to 
be  excess  and  available  for  disposal. 

Safety  program 

Accident  prevention  efforts  in  the  Treasury  were  successful  in 
decreasing  the  calendar  year  1960  accident  frequency  rate  (the  number 
of  lost  time  injuries  per  million  man-hours)  to  an  all  time  low  of  3.9. 
In  addition  to  a  more  favorable  frequency  rate  the  Treasury  record 
was  improved  in  several  otlier  ways.  The  number  of  injuries  dropped 
from  730  in  calendar  1959  to  633  in  calendar  1960;  the  number  of  days 
lost  from  the  job  decreased  from  40,143  to  37,002;  and  the  total  direct 
cost  was  cut  by  $138,000.  The  severity  rate  (number  of  da^-^s  lost  per 
million  man-hours)  improved  from  252  to  229,  and  the  total  direct  cost 
per  employee  decreased  from  $7.46  to  $5.56. 

Incentive  awards  program 

At  the  departmental  level,  responsibility  for  the  incentive  awards 
program  was  transferred  from  the  Office  of  Management  and  Organi- 
zation to  the  Office  of  Personnel.  Excellent  progress  continued  to  be 
made,  with  the  number  of  employee  suggestions  adopted  increasing 
to  2,464  in  fiscal  1961,  an  increase  of  6  percent.  Superior  performance 
awards  jumped  25  percent  to  a  new  high  of  2,714.  Estimated  annual 
savings  rose  to  over  $1  million,  13  percent  above  the  previous  year.  In 
addition,  $2  million  was  saved  under  the  military  incentive  awards 
program  of  the  U.S.  Coast  Guard.  In  that  Bureau  one  award  alone 
saved  an  estimated  $1.8  million. 

The  Bureau  of  Engraving  and  Printing  won  the  second  annual 
award  of  the  Secretary  of  the  Treasury  for  the  bureau  showing  the 
best  average  results  under  the  program. 

Bureau  of  the  Comptroller  of  the  Currency  ^ 

The  Biu'eau  of  the  Comptroller  of  the  Currency  is  responsible  for 
the  execution  of  laws  relating  to  the  supervision  of  national  banking 
associations.    Duties  of  the  office  include  those  incident  to  the  forma- 

'  Additional  information  concerning  the  Bureau  of  the  Comptroller  of  the  Currency  is  contained  in  the 
separate  annual  report  of  the  Comptroller  of  the  Currency. 


142 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


tioD  and  chartering  of  new  national  banking  associations,  the  examina- 
tion of  all  national  banks,  the  establishment  of  branch  banks,  the 
consolidation  of  banks,  the  conversion  of  State  banks  into  national 
banks,  recapitalization  programs,  and  the  issuance  of  Federal  Reserve 
notes. 


Abstract  of  reports  of  condition  of  active  national  banks  on  the  date   of  each  report 
from  June  15,  1960,  to  June  SO,  1961 

[In  thousands  of  dollars] 


June  15, 

1960 

(4,542 

banks) 


Oct.  3, 
1960 
(4.535 

banks) 


Dec.  31, 

1960 
(4,530 
banks) 


Apr.  12, 

1961 

(4,523 

banks) 


June  30, 

1961 

(4,524 

banks) 


Assets 

Loans  and  discounts,  including  overdrafts., 
U.S.  Government  securities,  direct  obliga- 
tions __ -. 

Obligations  guaranteed  by  U.S.  Govern- 
ment-  - 

Obligations  of  States  and  political  sub- 
divisions  

Other  bonds,  notes,  and  debentures 

Corporate  stocks,  including  stocks  of 
Federal  Reserve  Banks 

Total  loans  and  securities 

Cash,  balances  with  other  banks,  and  cash 
items  in  process  of  collection - 

Bank  premises  owned,  furniture  and  fix- 
tures  - 

Real  estate  owned  other  than  bank  premises. 

Investments  and  other  assets  indirectly 
representing  bank  premises  or  other  real 
estate 

Customers'  liability  on  acceptances 

other  assets 

Total  assets 

Liabilities 

Demand  deposits  of  individuals,  partner- 
ships, and  corporations 

Time  and  savings  deposits  of  individuals, 
partnerships,  and  corporations 

Deposits  of  U.S.  Government  and  postal 
savings 

Deposits  of  States  and  political  subdivisions. 

Deposits  of  banks 

other  deposits  (certified  and  officers'  checks, 
etc.) - 

Total  deposits 

Demand  deposits. - 

Time  and  savings  deposits 

Rediscounts  and  other  liabihties  for  bor- 
rowed money - 

Mortgages  or  other  liens  on  bank  premises 

and  other  real  estate 

Acceptances  outstanding.. 

Other  liabilities 

Total  liabilities... 

Capit.\l  Accounts 

Capital  stock... 

Surplus 

Undivided  profits 

Reserves  and  retirement  account  for  pre- 
ferred stock 

Total  capital  accounts 

Total  liabilities  and  capital  accounts.. 


62, 397,  733 

29, 227, 240 

70, 438 

8, 984, 454 
1, 318, 874 

310,  631 


63, 137, 178 

30, 507, 592 

91, 209 

9, 123, 621 
1,245,349 

316,  748 


63,  693,  668 

32,615,321 

96,402 

9, 408, 711 
1, 407,  576 

324, 184 


63, 595, 879 

32, 228,  779 

122, 019 

9, 927, 654 
1,325,874 

333,  660 


63, 439, 852 

33, 397, 413 

124,680 

10, 123, 742 
1, 419, 736 

337, 241 


102, 309, 370 

26, 379,  669 

1,567,086 
56, 654 


158, 748 
361,  763 
599, 884 


104,  421, 697 
25, 846, 362 


1, 640, 168 
53, 467 


169, 502 
419, 342 
689, 799 


107,  545, 862 
28, 674,  506 


1, 685,  524 
51, 164 


173,611 
463, 691 
666, 509 


107,  533, 865 
25,440,116 


1,  749. 325 
54, 303 


185, 369 
446, 326 
691, 541 


108, 842, 664 
25, 274,  240 


1,774,055 
53, 978 


187, 073 
441, 638 
725, 347 


131,433,174 


133, 240, 337 


139, 260, 867 


136, 100, 845 


137, 298, 995 


59,  649, 364 

34, 650,  471 

3, 778, 109 
8, 137, 561 
8, 409, 880 

1, 552, 826 


59, 025,  547 

35, 972, 754 

4, 096, 097 
8, 473, 965 
8, 885, 686 

1, 509, 134 


63,131,263 

36,  761, 292 

3,  456,  544 
9,  297, 327 
10, 439, 491 

1,824,934 


61, 274,  612 

38, 922, 341 

1,576,344 
9, 187,  440 
8,611,099 

1, 492, 826 


59, 212, 875 

40,338,073 

3,  756,  972 
9, 762,  861 
7, 848, 020 

1,  566, 137 


116,178,211 


117,963,183 


124, 910,  851 


121,064,662 


122, 484, 938 


78,801,033 
37,377,178 

1,490,892 

3,086 

371,482 

2,  703, 341 


78,  998,  753 
38,  964, 430 

1, 013, 323 

2,967 

426, 827 

2, 824, 584 


84,  754, 054 
40, 156,  797 

110,  590 

3,189 

474, 565 

2, 663, 334 


78, 970, 875 
42, 093,  787 

686, 157 

3,158 

454, 133 

2,  546,  550 


78, 891, 899 
43, 593, 039 

355, 466 

3,338 

448,  976 

2,  567, 224 


120,  747, 012 


122, 230, 884 


128, 162, 529 


124, 754, 660 


125, 859, 942 


3,  265, 182 
5. 164,  562 
2, 019, 267 

237, 151 


3, 308, 077 
5,  250, 859 
2, 201, 129 

249,388 


3, 342,  850 
5, 446, 143 
2, 030, 052 

279, 293 


3,  459, 094 
5,  572, 040 
2, 047, 520 

267,531 


10, 686, 162 


11, 009, 453 


11,098,338 


11,346,185 


131, 433, 174 


133,240,337 


139, 260, 867 


136, 100, 845 


3,  478, 403 
5, 620, 169 
2,071,321 

269, 160 


11,439,053 


137, 298, 995 


ADMINISTRATIVE    REPORTS 


143 


Changes  in  the  condition  of  active  national  banks 

The  total  assets  of  the  4,524  active  national  banks  in  the  United 
States  and  possessions  on  June  30,  1961,  amounted  to  $137,299 
million,  as  compared  with,  the  total  assets  of  4,542  banks  amounting 
to  $131,433  million  on  June  15,  1960,  an  increase  of  $5,866  million 
during  the  year.  The  deposits  of  the  banks  in  1961  totaled  $122,485 
million,  which  was  $6,307  million  more  than  in  1960.  The  loans  in 
1961  were  $63,440  million,  exceeding  the  1960  figure  by  $1,042  million. 
Securities  held  totaled  $45,403  million,  an  increase  of  $5,491  mil- 
lion during  the  year.  Capital  funds  of  $11,439  million  were  $753 
million  more  than  in  the  preceding  year. 

Summary  of  changes  in  number  and  capital  stock  of  national  banks 

The  authorized  capital  stock  of  the  4,525  national  banks  in  exist- 
ence on  June  30,  1961,  consisted  of  common  stock  aggregating  $3,478 
million,  and  preferred  stock  aggregating  $1.3  million.  The  common 
stock  of  the  4,539  national  banks  in  existence  a  year  earlier  amounted 
to  $3,276  million,  and  preferred  stock  to  $1.5  million.  During  the 
year  charters  were  issued  to  39  national  banks  having  an  aggregate 
of  $21.1  million  of  common  stock.  There  was  a  net  decrease  of  14 
in  the  number  of  national  banks  in  the  system  by  reason  of  voluntary 
liquidations,  statutory  consolidations  and  mergers,  conversions  to  and 
mergers  or  consolidations  with  State  banks  under  the  provisions  of 
the  act  of  August  17,  1950  (12  U.S.C.  214),  and  one  receivership. 

More  detailed  information  regarding  the  changes  in  the  number  and 
capital  stock  of  national  banks  in  1961  is  shown  in  the  following  table. 

Organizations,  capital  stock  changes,  and  liquidations  of  national  banks,  fiscal  year  1961 


Number 
of  banks 


Capital  stock 


Common 


Preferred 


Charters  in  force  June  30,  1960,  and  authorized  capital  stock. 

Increases: 

Charters  issued 

Capital  stock: 

195  cases  by  statutory  sale 

475  cases  by  statutory  stock  dividends 

1  case  by  conversion  of  preferred  stock 

32  cases  by  statutory  consolidation 

24  cases  by  statutory  merger 


Total  increases. 


Decreases: 

Voluntary  liquidations 

Statutory  consolidations 

Statutory  mergers 

Conversions  into  State  banks 

Merged  or  consolidated  vsith  State  banks. 

Receivership 

Capital  stock: 

2  cases  by  statutory  reduction 

2  cases  by  statutory  merger 

3  cases  by  retirement -.. 


Total  decreases. 


Net  change ..- 

Charters  in  force  June  30,  1961,  and  authorized  capital  stock  '. 


4,539 


$3, 275, 910, 031 


21,092,750 

25, 592, 636 

149, 489, 460 

111,600 

10,271,015 

7, 565, 325 


39 


214, 122, 786 


550, 000 


505, 000 

11,010,000 

50, 000 

33,783 
269, 675 


53 


12, 418, 458 


-14 


201,704,328 


4,525 


3, 477, 614, 359 


1, 529, 370 


206,070 


206, 070 


-206,070 


1,323,300 


'  These  figures  differ  from  those  in  the  preceding  table.  The  figures  as  of  June  30,  1961,  include  1  new 
bank  not  yet  open  for  business,  and  1  bank  in  process  of  merging  or  consolidating  with  and  into  a  State 
bank  under  the  provisions  of  the  act  of  Aug.  17,  1950  (12  U.S.C.  214),  and  exclude  1  bank  consolidated  wth 
another  national  bank  under  the  provisions  of  the  act  of  Nov.  7, 1918,  as  amended  (12  U.S.C.  215). 


144   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Bureau  of  Customs 

The  major  responsibility  of  tJie  Bureau  of  Customs  is  to  administer 
the  Tariff  Act  of  1930,  as  amended.  Its  primary  duties  include  the 
assessment  and  collection  of  all  duties,  taxes,  and  fees  due  on  imported 
merchandise,  the  enforcement  of  customs  and  related  laws,  and  the 
administration  of  certain  navigation  laws  and  treaties.  As  an  enforce- 
ment organization,  customs  is  concerned  primarily  with  combating 
smuggling  and  frauds  on  the  revenue.  It  also  enforces  the  regulations 
of  numerous  other  Federal  agencies. 

Collections 

Revenue  collected  by  the  Customs  Service  during  the  fiscal  year 
1961  totaled  more  than  $1,423  million,  or  6.4  percent  less  than  the 
$1,520  million  collected  in  1960.  In  addition  to  customs  collections, 
the  total  included  certain  taxes  collected  for  the  Internal  Revenue 
Service  and  some  collections  for  other  Government  agencies.  Larger 
customs  collections  than  in  fiscal  1960  were  reported  by  15  customs 
districts.     Collections  by  customs  districts  are  shown  in  table  94. 

Customs  collections  alone  amounted  to  almost  $1,017  million,  10.1 
percent  less  than  the  $1,131  million  collected  in  1960.  Almost  $1,008 
million  was  derived  from  duties  (including  import  taxes)  levied  on 
hnported  merchandise.  They  also  included  tonnage  taxes,  fees,  and 
fines  and  penalties  for  the  violation  of  customs  and  navigation  laws. 
Collections  by  Customs  of  internal  revenue  taxes  on  imported  liquors, 
wines,  perfumes,  etc.,  amounted  to  over  $406  million,  4.5  percent 
more  than  the  $389  million  collected  in  1960.  Miscellaneous  collec- 
tions amounted  to  almost  $9  million,  an  increase  of  17.8  percent  over 
those  in  1960.  The  major  classes  of  all  collections  are  shown  in 
table  19. 

During  the  fiscal  3='ear  1960  almost  41  percent  of  all  imports  into 
the  United  States  was  duty  free.  Included  were  some  commodities, 
such  as  copper  and  iron  and  steel  scrap,  imported  free  for  Government 
stockpile  purposes,  or  authorized  by  special  acts  of  Congress  for  free 
entry  although  dutiable  under  the  Tariff  Act  of  1930,  or  taxable  under 
the  Internal  Revenue  Code.  The  59  percent  which  was  dutiable 
constituted  the  basis  of  customs  duties  on  unports. 

Values  and  collections  on  dutiable  imports  by  tariff'  schedule  and 
country  for  fiscal  1960,  which  were  omitted  from  the  1960  annual 
report  because  of  technical  difficulties  will  be  found  in  tables  97 
through  100.  The  comparable  statistics  subsequent  to  the  fiscal  year 
1960  will  not  be  published  by  the  Treasury  Department,  but  will  be 
provided  by  the  Bureau  of  the  Census  and  incorporated  in  Depart- 
ment of  Commerce  publications. 

By  commodities. — During  fiscal  1960,  for  the  ninth  consecutive  j^ear, 
unports  of  metals  and  manufactures  were  the  largest  single  source  of 
customs  revenue,  with  an  increase  of  25.6  percent  more  in  duty 
collections  than  in  fiscal  1959.  The  sundries  schedule  remained  in 
second  place  with  an  increase  of  42.7  percent,  followed  by  the  wool 
schedule  with  an  increase  of  8  percent.  The  value  of  dutiable  and 
taxable  imports  for  consumption  and  duties  and  taxes  collected  by 
tariff  schedules  for  fiscal  1959  and  1960,  will  be  found  in  table  99. 


ADMINISTRATIVE    REPORTS  145 

The  value  of  and  duties  collected  on  imports  for  consumption  by 
the  calendar  3'ears  1949  through  1959  are  shown  in  tables  97  and  98. 

By  countries  of  origin. — -Imports  from  Japan  again  were  the  largest 
source  of  customs  revenue  and  duties  collected  thereon  were  28.3 
percent  more  than  in  1959.  The  United  Kingdom  ranked  second 
with  an  increase  of  9.1  percent.  The  Federal  Republic  of  Germany, 
with  an  increase  of  27.2  percent,  ranked  third.  Canada  remains  in 
fourth  place  with  an  increase  in  duties  of  14.2  percent. 

Customs  operations  in  1961 

Vehicles  and  persons  entering. — -More  than  45.1  million  carriers 
entered  United  States  harbors,  international  airports,  or  crossed 
United  States  borders  during  fiscal  1961,  bringing  over  131  million 
persons.  In  addition,  over  27  million  persons  walked  across  the 
borders.  Altogether  more  than  158  million  persons  were  subject  to 
customs  inspection.  There  was  a  3.6  percent  increase  in  carriers  and 
a  5.8  percent  increase  in  persons  entering  the  United  States  in  fiscal 
1961  as  compared  with  fiscal  1960.  Statistics  for  the  two  years  are 
contained  in  tables  101  and  102. 

Entries  of  merchandise. — Imports  into  the  United  States  in  fiscal 
1961  decreased  for  the  first  tune  in  many  years.  The  value  of  imports 
totaled  $13.8  billion,  down  $1.5  bilhon  from  the  entries  in  fiscal  1960. 
Formal  entries  of  merchandise,  comprising  consumption,  warehouse, 
and  rewarehouse,  exceeded  one  million  for  the  sixth  consecutive  year. 
There  were  1,398,123  formal  entries  filed  during  fiscal  1961,  5.3 
percent  less  than  those  in  1960.  Informal  entries  and  baggage 
declarations  covering  mail  importations  and  other  shipments  valued 
at  less  than  $250,  totaled  5,481,650,  an  increase  of  18.7  percent. 
The  volume  of  entries  handled  by  customs  officers  during  the  past 
two  years  is  shown  in  table  95. 

Draivback  transactions. — -Drawback  allowance  on  the  unportation 
of  merchandise  manufactured  from  imported  materials  and  for  certain 
other  export  transactions  usually  amounts  to  99  percent  of  the  customs 
duties  paid  at  the  tmie  the  goods  are  entered.  The  total  drawback 
paid  ui  fiscal  1961  was  $11,595,663,  which  included  an  increase  of 
35.1  percent  over  fiscal  1960.  The  principal  imported  materials  used 
in  manufacturing  exports  in  1961  were  aluminum;  chemicals;  cotton 
cloth;  iron  and  steel  semimanufactures;  lead  ore,  matte,  pigs,  and  bars; 
nonmetallic  minerals  and  manufactures;  paper  and  manufactures; 
petroleum  and  products;  sugar;  tobacco,  unmanufactured;  and  watch 
movements.  Table  96  shows  the  drawback  transactions  for  1960 
and  1961. 

Appraisement  of  merchandise  (including  Customs  Information  Ex- 
change).— ^For  the  first  time  in  six  years  there  was  a  slight  decrease  in 
the  number  of  invoices  examined  b}'  appraisers'  personnel.  During 
fiscal  1961,  2,181,008  invoices  were  filed,  compared  with  2,322,480  in- 
voices in  1960,  a  decrease  of  6.1  percent.  The  total  nmnber  of  pack- 
ages examined  by  appraisers'  personnel  decreased  0.6  percent  from 
1,386,158  during  1960  to  1,377,351  in  fiscal  1961.  This  decrease  was 
not  in  proportion  to  the  decrease  in  all  invoices  and  may  be  attributed 
to  new  products  which  require  more  examinations  per  invoice. 


146   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  backlog  of  unappraised  invoices  over  30  days  old  decreased 
during  fiscal  1961  from  247,000'"  to  194,000,  a  reduction  of  21.6  percent. 
The  decrease  resulted  from  the  smaller  nimiber  of  invoices  received 
and  the  concentration  of  field  personnel  on  reducing  backlogs. 

Under  the  Antidumping  Act,  32  complaints  of  dmnping  were  re- 
ceived as  compared  with  33  in  1960.  Thirty-five  cases  were  disposed 
of,  leaving  29  under  investigation  at  the  end  of  fiscal  1961,  compared 
with  32  a  year  earlier.  For  a  determination  as  to  possible  injury  to 
American  industry,  ten  cases  were  referred  to  the  United  States  Tariff 
Commission. 

No  new  cases  of  countervailing  duty  were  received  during  fiscal 
1961.  Of  the  five  cases  carried  over  from  the  year  before,  two  were 
closed,  leaving  three  on  hand. 

The  activities  of  the  Customs  Information  Exchange  in  New  York, 
N.Y.,  continued  at  the  high  level  of  1960.  Appraisers'  reports  of 
classification  and  value,  covering  a  cross  section  of  unportation  of 
merchandise  received  at  each  port,  totaled  78,000  compared  with 
79,000  in  1960.  These  reports  indicate  the  relative  number  of  com- 
modity items  received  at  any  given  port  for  the  first  time,  as  well  as 
regularly  received  items  at  new  prices  or  subject  to  different  terms  of 
sale  from  previous  shipments. 

Differences  in  classification  and  value  indicate  the  number  of  in- 
stances where  information  as  to  the  value  or  classification  of  merchan- 
dise varied  among  ports  or  when  the  conclusions  of  appraising  officers 
differed.  In  the  latter,  additional  study  and  analysis  were  required 
before  a  uniform  price  or  rate  could  be  established.  There  were 
7,243  reports  of  value  differences  during  fiscal  1961,  as  compared  with 
8,882  in  1960.  Differences  in  classification  totaled  4,803  during  1961 
compared  with  4,502  in  1960,  indicating  a  continuing  increase  in  new 
connnodities  received. 

Foreign  inquiries  requiring  detailed  investigations  abroad  to  secure 
information  for  appraisement  purposes  decreased  from  244  in  fiscal 
1960  to  215  in  1961.  This  11.9  percent  decrease  may  be  ascribed  to 
the  continuing  effect  of  the  elunination  of  foreign  value  as  a  basis  of 
appraisement  under  the  terms  of  the  Customs  Simplification  Act  of 
1956  (19  U.S.C.  1402),  and  to  present  procedure  which  permits  the  use 
of  a  foreign  inquiry  only  as  a  last  resort  in  securing  value  infornuition. 

Technical  seruices. — This  division  of  the  Customs  Service  furnishes 
chemical,  engineering,  statistical  weighing  and  sampling,  and  other 
scientific  and  technical  services;  provides  proper  weighing  and  gauging 
equipment  and  standards;  designs  and  oversees  the  construction  of 
border  inspection  stations;  and  directs  the  field  operations  of  Customs 
laboratories.  Developing  and  supplying  investigative  aids  for  en- 
forcement officers  is  a  contiiming  fmiction  of  the  laboratories. 

The  laboratories  analyzed  approxunately  124  thousand  samples  in 
fiscal  1961.  A  slight  decrease  from  1960  was  occasioned  b}^  a  signifi- 
cant decrease  in  the  number  of  raw  sugar  samples  due  to  a  change  to 
bulk  handling  and  to  improved  sampling  practices.  Samples  of  im- 
ported merchandise  submitted  to  obtain  information  necessary  to 
assist  in  appraisement  and  tariff  classification  made  up  a  large  ma- 
jorit}'  of  those  analyzed.  Other  types  analyzed  were  those  taken  from 
seizures,  mosth'  narcotics  and  prohibited  merchandise;  preshipment 

'  Revised. 


ADMINISTRATIVE    REPORTS 


147 


samples  of  merchandise  intended  for  shipment  to  tlie  United  States 
analyzed  to  assist  in  establishing  proper  classification;  and  samples 
tested  for  other  Government  agencies. 

Chief  chemists  provided  statistical  quality  control  of  sample 
weighing  operations  by  making  analyses  of  cargo  sample  weighing 
data  to  assure  that  accuracy  and  precision  were  within  control  limits. 
Ninety-nine  cargoes  of  raw  sugar,  50  cargoes  of  refined  sugar,  75 
cargoes  of  cigarette  tobacco,  and  1  cargo  of  rayon  were  weighed 
by  statistically  controlled  methods.  Statistical  review  of  the  verifi- 
cation of  liquidations  by  comptrollers  (final  determination  of  duty 
and  taxes)  was  continued.  A  special  exchange  sampling  technique 
was  tried  out  under  this  program.  A  factor  based  on  statistical 
evaluation  was  developed  to  assist  in  gauging  Greek  black  olives. 
The  division  recommended  approval  of  bulk  weighing  equipment 
meeting  customs  specifications  at  a  number  of  locations. 

In  cooperation  with  the  Immigration  and  Naturalization  Service, 
plans  were  prepared  for  a  number  of  border  stations  with  residences. 
Contracts  were  awarded  for  residences  at  Pittsburg,  N.H.,  and 
Lukeville,  Ariz.,  and  for  inspection  stations  and  two  residences  at 
Roseau,  Minn.,  Maida,  N.D.,  and  Del  Bonita,  Mont. 

Construction  plans  of  various  projects  involving  space  for  customs 
prepared  by  the  General  Services  Administration  or  engineering 
firms  were  reviewed  and  appropriate  changes  recommended.  Major 
projects  include  Jackman,  Maine,  Lewiston  Bridge,  N.Y.,  Sault 
Ste.  Marie,  Mich.,  Massena,  N.Y.,  and  Sweetgrass,  Mont.  Inspection 
facilities  at  Eagle  Pass,  Tex.,  and  Dunseith,  N.D.,  previously  re- 
viewed, were  completed.  Preliminary  plans  for  future  stations  at 
a  number  of  locations  were  reviewed  with  appropriate  recommenda- 
tions. 

Export  control. — During  fiscal  1961  export  declarations  authen- 
ticated increased  6.2  percent  over  1960,  while  shipments  examined 
increased  23.6  percent.  The  number  of  seizures  increased  12.1  per- 
cent and  their  value  increased  163.4  percent.  The  following  table 
shows  the  volume  of  export  control  activities. 


Activity 


Export  declarations  authenticated 

Shipments  examined 

Number  of  seizures 

Value  of  seizures 

Export  control  employees 


1960 


4, 474, 425 

482,  737 

198 

$249,  385 

160 


4,  758, 249 

596, 457 

222 

$656,  903 

173 


Percentage 
increase 


6.2 
23.6 
12.1 
1 63.  4 

M 


At  the  request  of  the  Department  of  Commerce,  this  Bureau  added 
the  name  of  Cuba  to  and  made  certain  revisions  in  the  list  of  countries 
to  which  vessels  cannot  be  cleared  without  first  filing  complete  out- 
ward foreign  manifests  and  all  required  export  declarations  The 
list  includes  countries  in  the  Sino-Soviet  bloc,  Hong  Kong,  and 
Macao,  and  names  among  others,  the  Commimist-controlled  areas 
of  Vietnam,  East  Germany  (Soviet  Zone  of  Germany  and  the  Soviet 
Sector  of  Berlin),  North  Korea,  and  Outer  Mongolia.  Similar  re- 
strictions have  been  imposed  upon  aircraft  departures. 


148 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Protests  and  appeals. — Protests  filed  by  importers  against  the  rate 
and  amount  of  duty  assessed  and  other  decisions  made  by  collectors 
of  customs  increased  9.7  percent.  Appeals  for  reappraisement  filed 
by  importers  who  did  not  agree  with  appraisers  as  to  the  value  of 
merchandise  increased  25.3  percent.  Tlie  following  table  shows  the 
number  of  protests  and  appeals  filed  and  acted  upon  during  fiscal 
1960  and  1961. 


Protests  and  appeals 


Protests: 

Filed  with  collectors  by  importers 

Allowed  by  collectors 

Denied  by  collectors  and  forwarded  to  customs  court 
Appeals  for  reappraisement  filed  with  collectors 


1960 


32,  469 
4.509 

33.  S81 
21,  773 


1961 


35, 627 
3,532 
27. 907 

27, 281 


Percentage 
increase,  or 
decrease  ( — ) 


-21.7 

-17.6 

25.3 


Marine  activities. — The  American  merchant  marine  continued  its 
steady  growth  during  fiscal  1961.  At  the  end  of  the  year  the  docu- 
mented fleet  totaled  51,115  vessels  as  compared  with  48,884  at  the 
end  of  1960,  an  increase  of  4.6  percent.  During  the  year,  1.714  vessels 
were  removed  from  documentation  and  about  3,945  vessels  (roughly 
the  total  nmnber  of  all  sizes  built)  never  before  docmnented  were 
added.  Approximately^  7,500  were  documented  as  yachts,  while 
almost  43,600  were  authorized  through  docmiientation  to  be  used  in 
commercial  activities  in  the  foreign,  coasting,  or  fishing  trades. 
There  was  an  increase  of  36.4  percent  in  the  nmnber  of  vessels  docu- 
mented as  yachts  during  this  fiscal  year.  The  continued  increase  in 
the  docimientation  of  vachts  can  be  attributed,  at  least  in  part,  to 
the  eftect  of  the  Federal  Boating  Act  of  1958  (46  U.S.C.  527)  which 
permits  the  States  to  number  vessels  under  certain  conditions. 
Yachtsmen  have  been  docmnenting  their  vessels  rather  than  obtain- 
ing numbers  under  the  various  States'  laws.  The  followmg  table 
shows  the  volmne  of  marine  documentation  during  fiscal  years  1960 
and  1961. 


Activity 


1961 


Percentage 
increase,  or 
decrease  (— ) 


Total  vessels  documented  at  end  of  year 

Documents  issued  (registers,  enrollments,  and  licenses) 

Licenses  renewed  and  changes  of  master  endorsed 

Mortgages,  satisfactions,  notices  of  lien,  bills  of  sale,  abstracts 

of  title,  and  other  instruments  of  title  recorded 

Abstracts  of  title  and  certificates  of  ownership  issued 

Navigation  fines  imposed - 

Tonnage  tax  payments 


48, 884 
15.840 
46,  623 

14,414 
6. 885 
3,063 

23,016 


51,115 
17,396 
47,  440 

14,954 
7,754 
2,919 

23, 731 


1.8 

3.7 

12.6 

-4.7 

3.1 


A  number  of  vessels  admeasured  during  the  fiscal  year  were  large 
cargo  vessels  admitted  to  American  registry  for  the  first  time  or 
returned  in  order,  apparently,  to  be  entitled  to  participate  in  the 


ADMINISTRATIVE    REPORTS  149 

transportation  of  American  foreign-aid  cargo.  Not  less  than  50  per- 
cent of  such  cargoes  are  required  by  law  to  be  carried  in  American 
vessels.  The  transfer  to  American  registry  became  desirable  because 
of  the  decline  in  foreign  cargo  available  through  other  sources. 

The  arrangements  made  with  the  Panama  Canal  Company  to 
receive  direct  notification  of  any  changes  in  tonnages  shown  on 
Panama  Canal  certificates  issued  by  the  Bureau  have  resulted  in  the 
receipt  of  information  from  the  Canal  which  has  been  found  to  affect 
the  tonnages  of  such  vessels  under  American  registry"  as  well  as  Canal 
tonnages.  As  a  consequence  the  Bureau  has  issued  new  rulings 
concerning  the  treatment  of  propelling  machiner}'  spaces,  unoccupied 
sleeping  rooms  for  spare  crew  members,  and  related  matters. 

Instructions  were  issued  during  the  year  on  the  admeasurement 
procedures  to  be  followed  in  connection  with  new  classes  or  types  of 
vessels,  principally  nuclear-powered  vessels,  hydrofoils,  and  a  type  of 
collapsible  container  of  flexible  sausage-shaped  barge,  known  as  a 
Dracone  and,  intended  for  use  in  a  partially  submerged  condition  in 
the  transportation  of  fuel  oil  or  other  liquid  cargoes.  When  filled 
the  Dracone  is  intended  to  be  towed  afloat  and  when  empty  is  to  be 
rolled  up  on  a  reel  for  transportation  as  deck  cargo.  This  type  of 
contrivance  is,  of  course,  one  that  was  not  within  the  contemplation  of 
those  who  drafted  the  origmal  admeasurement  laws  and  the  applica- 
tion of  the  statutory  provisions  to  such  craft  presents  many  problems. 

A  bill  to  repeal  a  nmnber  of  statutes  which  established  certain 
marine  fees  and  prohibited  the  collection  of  others  was  reintroduced 
in  the  first  session  of  the  87th  Congress.  This  bill,  if  enacted,  would 
permit  the  Bureau  to  charge  for  certain  services  such  as  the  documen- 
tation of  vessels,  renewals  of  licenses,  and  entry  and  clearance  under 
regulations  to  be  prescribed  by  the  Secretary  of  the  Treasury  under 
the  authority  of  section  140  of  Title  5,  United  States  Code. 

A  nmnber  of  other  legislative  proposals  aft'ecting  functions  ad- 
ministered under  the  navigation  laws  of  the  United  States  were 
reviewed  during  the  year.  Included  among  those  proposals  were: 
Draft  legislation  to  permit  certain  transportation  on  Canadian  vessels 
between  ports  in  Alaska  and  in  some  cases  between  such  ports  and 
other  points  in  the  United  States  outside  of  Alaska;  the  collection  of 
statistics  on  movements  in  the  foreign  trade  of  the  United  States  and 
in  trade  with  certain  noncontiguous  areas;  the  admeasurement  of 
small  vessels  under  a  smiplified  procedure;  the  importation  of  fish  into 
the  Virgin  Islands  by  foreign  vessels;  the  operation  of  fishing  vessels 
transporting  the  catches  of  other  vessels  while  under  enrolhnent  and 
license;  the  admission  of  a  class  of  vessels  of  12,500  gross  tons  or 
more  to  American  registry  for  the  coastwise  trade,  even  though 
formerly  under  foreign  registry;  the  elimination  of  the  form  of  oath 
required  on  shippers'  export  declarations;  the  documentation  of  ves- 
sels sold  or  transferred  while  abroad;  and  a  number  of  bills  providing 
for  the  admission  of  specifically  named  foreign  vessels  to  American 
registry. 


150 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


The  following  table  shows  entrances  and  clearances  of  vessels  in 
fiscal  1960  and  1961. 


Vessel  movements 

1960 

1961 

Percentage 
increase,  or 
decrease  (— ) 

Entrances: 

Direct  from  foreign  ports 

53, 326 
37,  451 

48, 364 
38, 459 

-9.3 

Via  other  domestic  ports -  . 

2  7 

Total 

90,  777 

86, 823 

—4  4 

Clearances: 

Direct  to  foreign  ports      ._. 

51,086 
37,  913 

46.  421 
38, 193 

—9  1 

Via  other  domestic  ports 

Total... 

88, 999 

84,614 

-4.9 

Waivers  of  the  navigation  laws  of  the  United  States  were  granted 
upon  request  under  the  special  authority  contained  in  the  act  of 
December  27,  1950  (46  U.S.C.  1  note),  to  permit  certain  vessels  used 
in  transporting  material  dredged  from  the  Great  Lakes  connecting 
channels  to  proceed  into  Canadian  waters  without  clearing  upon 
departure  or  entering  upon  return  to  the  United  States.  The  pro- 
gram under  which  the  vessels  concerned  are  operating  is  designed  to 
increase  the  usability  of  the  waters  forming  a  part  of  the  systems 
served  by  the  Saint  Lawrence  Seaway  project. 

A  further  waiver  m  1961  permitted  a  Canadian  tug  to  tow  an 
American  barge  to  a  worksite  on  the  Saint  Lawrence  River  near 
Rooseveltown;  this  also  was  an  operation  related  to  the  Seaway 
project. 

General  instructions  were  issued  to  customs  marine  officers  in  the 
field  covering:  The  marking  of  names  and  hailing  ports  on  vessels; 
defining  and  standardizing  the  requirements  for  small  vessels;  the 
position  of  the  Bureau  in  construing  bareboat  charter's  for  yachts 
and  distinguishing  such  charters  from  time  charters  and  the  penalties 
to  be  imposed  for  violations;  the  accession  of  the  Republic  of  Haiti 
to  the  International  Load  Line  Convention;  a  procedure  for  determin- 
ing whether  any  particular  body  of  water  is  to  be  regarded  as  forming 
a  part  of  the  navigable  waters  of  the  United  States  for  applicability  of 
Federal  statutes  and  Bm-eau  regulations;  the  recording  and  indexing 
of  a  type  of  vessel  title  instrument  designed  to  serve  as  a  combined 
bill  of  sale,  mortgage,  and  assignment  of  mortgage;  and  the  procedure 
followed  by  disposal  agencies  in  the  sale  of  vessels  from  the  reserve 
or  laid-up  fleets  of  the  United  States. 

The  first  study  stage  of  the  program  to  develop  a  simplified  system 
of  ship  registry  was  completed.  A  proposed  documentation  pro- 
cedure package  which  may  be  used  as  a  basis  for  recommending 
revision  of  the  present  ship  registry  laws  is  being  drafted  for  comment 
by  both  Government  and  industry. 

A  Water  Transportation  Facilitation  Committee  composed  of  all 
Goverment  agencies  interested  in  shipping  problems  was  organized 
at  the  beginning  of  the  year  under  the  sponsorship  of  the  Department 
of  Commerce.  One  of  the  first  activities  in  which  this  committee 
expressed  an  interest  was  the  customs  program  for  the  simplification 
of  entrv  and  clearance  controls.     Revised  customs  control  forms  are 


ADMINISTRATIVE    REPORTS  151 

being  drafted.  It  is  anticipated  that  this  beginning  will  lead  to 
other  improvements  through  the  cooperation  of  Government  and 
industry. 

The  biennial  conference  of  the  Convention  for  Uniform  Tonnage 
Measurement  Rules,  signed  at  Oslo  on  June  10,  1947,  was  held  in 
Reykjavik,  Iceland,  June  14  to  29,  1961.  The  meeting  was  attended 
by  delegates  from  Denmark,  Federal  Republic  of  Germany,  Finland, 
France,  Iceland,  Israel,  Netherlands,  Norway,  and  Sweden.  Observ- 
ers represented  Japan,  Poland,  the  United  Kingdom,  and  the  United 
States.  Observers  were  also  present  from  the  Suez  Canal  Authority, 
the  Intergovernmental  Maritime  Consultative  Organization,  and  the 
Classification  Societies  of  Bureau  Veritas,  Germanischerlloyd,  and 
Lloyd's  Register  of  Shipping. 

Although  the  United  States  is  not  a  member  of  this  convention, 
it  is  faced  with  many  of  the  tonnage  measurement  problems  discussed 
at  the  meeting.  In  the  light  of  the  discussions  which  took  place,  the 
U.S.  observers  representing  the  Treasury  Department  and  the  shipping 
industry  were  convinced  more  than  ever  of  the  soundness  of  the  posi- 
tion of  the  United  States  in  seeking  a  simplified  method  of  tonnage 
measurement. 

The  same  observers  represented  the  United  States  as  official  mem- 
bers of  the  working  group  of  the  Subcommittee  on  Tonnage  Measure- 
ment, Intergovernmental  Maritime  Consultative  Organization,  which 
met  at  London  July  3  to  6,  1961.  As  a  result  of  the  attendance  at 
the  Reykjavik  meeting  the  United  States  proposals  were  considered 
with  interest  and  were  to  be  placed  before  the  meeting  of  the  full 
subcommittee  to  be  held  in  December  1961. 

Law  enforcement  and  investigative  activities. — The  Customs  Agency 
Service  conducted  18,828  investigations  during  1961  compared  with 
17,717  ■■  in  1960,  an  increase  of  6.3  percent.  These  investigations 
were  made  under  the  customs,  navigation,  and  related  laws  adminis- 
tered by  the  Bureau  of  Customs  and  several  laws  administered  by 
other  Government  agencies  and  enforced  by  Customs.  Table  104 
showing  the  number  of  cases  investigated  during  1960  and  1961, 
reflects  the  continued  emphasis  on  criminal  cases.  Investigation  of 
noncriminal  matters  remained  fairly  constant.  The  increase  in  num- 
ber of  export  control  violations  and  an  increase  in  the  smuggling  of 
arms  and  ammunition  out  of  the  country  resulted  from  the  embargo 
on  the  shipment  to  Cuba,  effective  October  20,  1960,  of  all  types  of 
merchandise  except  foods  and  medicines. 

Other  major  enforcement  problems  remained  much  the  same  as  in 
previous  years.  The  smuggling  of  narcotic  drugs  and  marihuana  was 
the  most  important,  with  the  smuggling  of  watches,  jewelry,  and  other 
types  of  expensive  merchandise  almost  as  great.  Although  there  was 
a  decline  in  the  number  of  investigations  involving  undervaluations 
and  false  invoicing,  they  still  constituted  a  major  problem.  As  indi- 
cated above,  the  illegal  exportation  of  arms  and  ammunition  and 
general  merchandise  to  Cuba  assiuned  increased  importance. 

Customs  agents  made  147  seizures  of  heroin  totaling  11,177.13 
grams  during  1961,  compared  with  132  seizures  totaling  8,479.21  grams 
in  fiscal  1960.  In  1961  there  were  28  seizures  of  opium  amounting  to 
44.75  kilograms,  compared  with  25  seizures  of  6.79  kilograms  during 

'  Revised. 


152 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


fiscal  1960.  The  two  largest  of  these  lots  originated  in  Calcutta,  and 
one  was  the  largest  apprehended  in  the  United  States  since  1952. 

Marihuana  seizures  during  fiscal  19G1  numbered  397  aggregating 
3,645.573  kilograms,  as  against  386  seizures  of  1,255.850  kilograms 
during  fiscal  1960.  However,  not  all  of  the  hicrease  in  marihuana 
seizures  represented  attempted  smuggling,  since  tlie  largest  seizure  of 
all,  made  on  April  19,  1961,  involved  26  kilograms  of  viable  marihuana 
seed  and  2,028  kilograms  of  hemp  stalks,  which  a  large  American  firm 
was  innocently  attempting  to  hnport  for  use  in  experiments  to  deter- 
mine if  the  fibers  were  suitable  for  making  paper.  Even  excluding 
this  item,  however,  the  year  to  year  increase  was  still  more  than  28 
percent.  Mexico  continued  to  be  the  source  of  95  percent  of  the 
marihuana  consumed  in  the  United  States. 

While  Europe  is  still  the  main  supplier  of  the  heroin  used  in  the 
United  States,  customs  seizures  consisted  in  large  part  of  heroin  from 
the  Far  East,  manufactured  mainly  in  Macao  from  morphine  extracted 
from  opium  in  Bangkok.  United  States  customs  officers  stationed  in 
the  Orient  report  that  the  quantities  of  narcotics  available  in  that  area 
are  ahiiost  unbelievably  large.  In  November  and  December  1960, 
for  instance,  the  authorities  in  Hong  Kong  made  seizures  on  two 
vessels  arriving  from  Bangkok  which  involved  a  total  of  1,984  pounds 
of  opium  and  330  pounds  of  block  morphine.  At  about  the  same 
time  a  seizure  of  2.2  tons  of  raw  opium  was  made  in  Thailand. 

Customs  agents  made  1,483  arrests  and  convicted  743  violators, 
compared  with  1,317  arrests  and  784  convictions  in  1960.  The 
following  table  shows  the  number  of  arrests  and  dispositions  during 
fiscal  1960  and  1961. 


Activity 


Percentage 
increase,  or 
decrease  (— ) 


Arrests 

Convictions 

Acquittals --- 

Nolle  prossed. 

Dismissed 

Not  indicted.,  - 

Under,  or  awaiting  indictment.-  1 

Turned  over  to  State  and  other  Federal  authorities  for  prose 
cution 


1,317 
784 

55 
101 
288 

11 
422 

93 


,483 
743 

34 
101 
399 

14 
366 


12.6 
-5.2 
-38.2 


38.5 

27.3 

-13.3 


During  fiscal  1961  customs  agents  and  enforcement  officers  made 
4,017  seizures  as  compared  with  1,570  in  1960.  Fines  and  penalties 
incurred  in  fiscal  1961  totaled  $28,469,300  compared  with  $13,730,125 
in  1960. 

Reflected  in  the  1961  statistics  is  the  eft'ectivencss  of  the  customs 
enforcement  officers  in  the  first  full  year  they  were  a  part  of  the 
Customs  i\.gency  Service.  Under  the  new  management  and  a  revi- 
talized program  of  training  personnel,  and  higher  grades  of  radio  and 
automobile  ec[uipment,  customs  enforcement  officers  arrested  265 
persons  and  made  2,579  seizures  of  miscellaneous  merchandise  valued 
at  $8,409,141.  Of  this,  $7,975,000  is  the  value  placed  on  nine  ocean- 
going vessels  seized  under  the  mandatory  provisions  of  an  act  approved 
June  17,  1930  (19  U.S.C.  1453),  which  requires  special  licenses  before 
lading  or   unlading   merchandise   from   any   vessel.     These   officers 


ADMINISTRATIVE    REPORTS 


153 


also  made  250  seizures  of  marihuana  weighing  38.42  kilograms  and  59 
seizures  of  opium  and  heroin  weigliing  43.14  kilograms. 

Seizures  of  merchandise  throughout  the  country  by  all  types  of 
customs  officers  during  fiscal  1961  for  violation  of  laws  enforced  by 
the  Customs  Service  numbered  14,658  with  an  appraised  value  of 
$15,850,918,  compared  with  13,950  seizures  in  1960,  appraised  at 
$8,677,279.  This  was  an  increase  of  5.1  percent  in  the  number  of 
seizures  and  an  increase  of  82.7  percent  in  the  appraised  value.  Title 
to  onlj'  a  small  fraction  of  these  seizures  actually  passed  to  the  Govern- 
ment, as  the  majority  are  destroyed  or  returned  to  the  owners  upon 
payment  of  fines  or  penalties.  Details  of  seizures  are  shown  in  table 
103. 

Foreign  trade  zones. — -During  fiscal  1961  large  quantities  of  Brazil 
nuts,  pharmaceuticals,  transistor  radios,  lead,  zinc,  sugar,  talc,  and 
heavy  machinery  continued  to  flow  in  and  out  of  Foreign  Trade 
Zone  No.  1  at  New  York,  N.Y.  Five  ships  berthed  to  lade  domestic 
ship's  stores  and  44  ships  used  the  zone  facilities  for  discharging 
cargo  from  foreign  countries.  Raw  cotton  is  brought  into  Foreign 
Trade  Zone  No.  2  at  New  Orleans,  La.,  from  foreign  countries,  manu- 
factured into  cotton  card  laps,  and  then  shipped  to  mills  for  further 
cotton  manufacturing.  Activities  at  the  San  Francisco  Foreign 
Trade  Zone  (No.  3)  remained  at  approximately  the  same  level  as 
during  1960,  although  duties  and  taxes  collected  increased  by  21 
percent.  There  were  decreases  in  all  activities  at  Foreign  Trade 
Zone  No.  4  at  Seattle,  Wash.  Foreign  Trade  Zone  No.  7  at  Maya- 
guez,  Puerto  Rico,  and  Foreign  Trade  Zone  No.  8  at  Toledo,  Ohio, 
were  approved  but  were  not  activated  until  fiscal  1962. 

The  following  table  contains  a  brief  summary  of  foreign  trade 
zone  operations  during  fiscal  1961. 


Number 

of 
entries 

Received  in  zone 

Delivered  from  zone 

Duties  and 
internal 

Tidde  zone 

Long  tons 

Value 

Long  tons 

Value 

revenue 

taxes 
collected 

5,747 

3,410 

6,344 

658 

45, 007 

36, 217 

1,953 

297 

$35, 228, 900 

17, 956, 204 

2, 272, 874 

551, 565 

44, 374 

40,  634 

2,077 

484 

$39, 963, 091 

22, 178, 988 

2, 314, 648 

724, 998 

$4, 390, 372 

1, 147, 020 

267, 511 

86, 390 

New  Orleans 

Seattle    .                    

Customs  ports  oj  entry,  stations,  and  airports. — The  hmits  of  the 
port  of  Los  Angeles,  Calif.,  were  extended  and  redescribed  to  include 
all  the  territory  within  the  corporate  limits  of  Los  Angeles  (which 
include  San  Pedro  and  Wilmington,  Calif.),  the  territory  within  the 
corporate  limits  of  El  Segundo,  Long  Beach,  and  Signal  Hill,  Calif., 
and  in  addition,  certain  other  territory  lying  east  of  the  corporate 
limits  of  Los  Angeles.  Kodiak,  and  Anchorage,  Alaska,  and  Port 
Canaveral,  Fla.,  were  designated  ports  of  entry.  St.  Juste,  Quebec, 
Canada;  Houma,  La.,  and  Culebra,  Puerto  Rico,  were  designated  as 
customs  stations.  The  designations  of  Lac  Frontiere,  Quebec, 
Canada,  and  Fort  Yukon,  Alaska,  as  customs  stations  were  revoked. 
The  name  of  the  customs  station  at  Connecticut  Lakes,  N.H.,  was 
changed    to   Pittsburg,   N.H.     Customs   preflight  inspection   offices 


154   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

were   established    at   Kindley   Field,    Bermuda,    and    at    Vancouver 
International  Airport,  Vancouver,  B.C.,  Canada. 

Cost  of  administration 

Regular  nonreimbursable  customs  employment  increased  1.6 
percent  in  1961.  Total  emplo^nuent  increased  1.8  percent.  Export 
control  employment,  financed  by  funds  from  the  Department  of 
Commerce,  increased  8.1  percent,  while  employment  financed  by 
funds  transferred  from  the  Department  of  Agriculture  increased  6.8 
percent. 

Customs  operating  expenses  totaled  $62,109,562,  including  export 
control  expenses  and  the  cost  of  additional  inspection  reimbursed  by 
the  Department  of  Agriculture. 

The  following  table  shows  man-year  emplo\niient  data  in  fiscal 
1960  and  1961. 


Operation 


Man -years 
1960 


Man-years 
1961 


Percentage 
increase 


Regular  customs  operations: 

Nonreimbursable 

Reimbursable  i 

Total  regular  customs  employment 

Export  control.. 

Additional  inspection  for  Department  of  Agriculture 

Total  employment-. 


7,213 
299 


7,328 
302 


1.6 
1.0 


7,512 
160 
176 


7,630 
173 
188 


1.6 

8.1 


7,991 


1.8 


»  Salaries  reimbursed  to  the  Government  by  the  private  firms  who  received  the  exclusive  services  of  these 
employees. 


Management  improvement  program 

Management  improvement  in  fiscal  1961  was  concentrated  primarily 
on  projects  to  facilitate  trade  and  travel  m  contrast  to  Bureau  opera- 
tions which  received  special  attention  m  1960.  Total  savmgs  of 
$188,200  were  realized.  The  savmgs  were  used  to  finance  several 
essential  but  uiibudgeted  projects,  mcluding  preflight  clearance  at 
Bermuda  and  Vancouver,  and  a  special  customs  traming  program  for 
enforcement  officers  as  well  as  to  reduce  backlogs  of  work  and  to  meet 
unexpectedly  large  costs  for  miscellaneous  services. 

International  trade. — A  significant  reduction  was  made  in  the  entries 
awaiting  liquidation  (the  fuial  determmation  of  duties  and  taxes  due), 
which  had  reached  an  alltime  peak  of  642,000  on  December  31,  1960. 
Duruig  the  last  six  months  of  fiscal  1961  a  reduction  of  85,000  entries 
was  made,  chiefly  by  a  high  rate  of  mdividual  production  through 
improved  procedures  and  the  additional  manpower  obtained  with 
funds  authorized  ui  1960  and  1961.  During  the  same  period  the 
Invoices  awaiting  action  by  the  appraisers  were  reduced  by  60,000,  a 
substantial  reduction  in  another  area  where  the  backlog  was  large. 

New  procedures  were  developed  to  facilitate  the  customs  entry  and 
release  of  lift  vans,  cargo  vans,  and  other  large  cargo  contamers,  and 
also  to  simplify  substantially  the  inspection,  examhiation,  and  release 
of  the  merchandise  imported  ui  these  containers.     The  new  procedures 


ADMINISTRATIVE    REPORTS  155 

recognize  the  increasing  use  of  cargo  containers  by  the  transportation 
industry. 

The  continuous  customs  supervision  of  the  discharge  of  bulk  petro- 
leum cargoes,  which  was  successfully  discontinued  at  Philadelphia  in 
1960,  has  been  ended  at  all  ports.  Contmuous  supervision  over  the 
withdrawal  of  oil  from  bonded  tanks  for  use  as  bunker  fuel  was  elimi- 
nated also  under  certam  conditions.  The  new  procedures  adequately 
safeguard  the  revenue  while  permitting  better  utilization  of  inspection 
manpower  and  substantial  savings  to  the  oil  companies  in  reimbursable 
overtime  charges. 

Customs  regulations  were  amended  to  permit  warehouse  with- 
drawals for  smelted  or  refined  metal  to  be  filed  for  a  greater  quantity 
than  that  on  hand  in  a  smelted  or  refined  state.  This  procedure 
benefits  importers  by  permittmg  them  to  take  advantage  of  any  quota 
that  may  be  opened  while  the  smelting  or  refining  process  is  underway. 

The  customs  treatment  of  shipments  arriving  at  one  port  for 
immediate  transportation  in  bond  to  another  port  was  facilitated  by  a 
new  procedure  which  permits  collectors  of  customs  at  destination  ports 
imder  certain  conditions  to  accept  entry  for  the  packages  in  the  ship- 
ment even  though  the  marks  and  numbers  on  the  packages  do  not 
agree  with  the  manifest.  This  procedure  will  eliminate  technical  and 
storage  problems. 

A  new  procedure  permits  horses  which  are  temporarily  imported  for 
exhibition  and  competition  to  be  entered  under  the  informal  entry 
procedure.  Also,  the  bond  given  by  the  importer  to  guaranty  sub- 
sequent exportation  does  not  require  surety  or  cash  in  lieu  of  surety. 
The  new  procedure  saves  importers  the  expense  and  inconvenience  of 
filing  formal  entry  supported  by  surety  bonds. 

A  power  of  attorney  from  an  importer  m  favor  of  an  unincorporated 
customhouse  broker  is  no  longer  required  to  contain  the  name  of  each 
broker's  employee  who  has  been  designated  by  the  broker  to  act  for 
him  in  customs  matters.  This  simplification  makes  it  unnecessary  for 
a  broker  to  secure  new  powers  of  attorney  for  all  his  clients  every  time 
he  wishes  to  designate  a  new  employee  to  act  for  him. 

The  airlme  companies  operating  international  flights  were  benefited 
by  the  establishment  of  a  new  consolidated  bond  which  mcorporates 
and  replaces  four  separate  bonds  previously  required.  The  new  bond 
may  run  indefinitely  thereby  eliminating  the  need  for  yearly  renewals. 
The  approval  of  each  bond  is  published  in  the  weekly  Treasury 
Decisions  which  makes  it  unnecessary  for  the  airlme  to  provide  a  copy 
of  the  bond  for  each  port  where  it  will  conduct  business. 

The  admmistrative  settlement  of  protests  m  which  there  is  no  dis- 
pute between  the  collector  of  customs  and  the  importer  was  facilitated 
by  a  new  policy  which  permits  collectors  to  validate  the  protest  and 
make  appropriate  adjustments  even  though  it  was  not  possible  to  do 
so  within  the  90  days  prescribed  by  the  Tariff  Act  of  1930.  Previ- 
ously many  oflBces  forwarded  all  protests  over  90  days  old  to  the 
Customs  Court,  even  though  they  agreed  with  the  contentions  of  the 
importer. 


614359—62 11 


156   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Standards  were  issued  for  the  uniform  application  of  penalties  for 
violation  of  the  customs  laws  relating  to  the  arrival  of  conveyances, 
persons,  and  merchandise  from  contiguous  countries. 

International  travel.- — A  study  of  customs  mspection  of  passengers' 
baggage  at  air,  sea,  and  border  ports  of  entr}'",  was  designed  to  deter- 
mine whether  current  requirements  and  procedures  unnecessarily  dis- 
courage foreign  tourists  from  visiting  the  United  States;  and  if  so,  to 
recommend  corrective  action.  A  task  force  of  citizens  organized  to 
make  the  study  includes  persons  interested  in  travel  and  transpor- 
tation, experts  in  business  management  and  governmental  procedures, 
a  sociologist,  and  an  authority  on  public  relations.  Most  large  ports 
of  entry  were  to  be  visited  by  the  members  during  the  summer  of  1961. 

Customs  prefiight  mspection  offices  were  established  at  Kmdley 
Field,  Bermuda,  and  at  Vancouver  International  Airport,  Vancouver, 
B.C.,  Canada.  Under  this  procedure,  persons  departmg  on  direct 
flight  by  commercial  aircraft  to  the  United  States  clear  through  the 
U.S.  Customs  before  boarding  the  aircraft.  Preclearance  enables 
them  to  proceed  without  further  delay  upon  arrival  in  the  United 
States.  Similar  procedures  were  already  in  effect  at  Toronto,  Mon- 
treal, and  Wmnipeg,  Canada,  and  at  Nassau,  Bahama  Islands. 

Customs  requirements  were  amended  to  permit  the  vehicles  carry- 
ing the  equipment  of  nonresident  athletic  teams  and  theatrical  troupes 
to  be  admitted  without  formal  customs  entry  regardless  of  the  number 
of  cities  in  which  they  will  appear  while  on  tour.  Previousl}^  formal 
entries  had  to  be  filed  for  these  vehicles  wdienever  the  teams  or 
troupes  appeared  in  more  than  one  city. 

Bureau  operations 

The  efficiency  and  eft'ectiveness  of  the  enforcement  operations  of  the 
Customs  Agency  Service  were  mcreased  substantiall}"  by  the  mstalla- 
tion  of  a  uniform  radio  system.  The  system  consists  of  repeater 
stations,  two-way  automobile  radios,  and  portable  units,  all  of  which 
operate  on  the  same  frequency,  thereby  providing  flexibility  and  in- 
creased range  of  communication.  Another  innovation  in  customs 
enforcement  work  was  introduced  at  New  York's  Idlewild  Airport 
when  closed  circuit  television  cameras  were  installed  to  monitor  a 
wide  area  where  planes  discharge  passengers,  baggage,  and  freight. 

An  extensive  training  program  in  law  enforcement  techniques  was 
developed  and  presented  to  customs  enforcement  officers  who  were 
transferred  from  the  offices  of  the  collectors  of  customs  to  the  Customs 
Agency  Service  in  1960.  The  training  course  was  designed  to  ac- 
quaint the  enforcement  officers  with  the  latest  developments  in  en- 
forcement methods  and  to  prepare  them  for  the  more  important 
enforcement  duties  to  whicli  they  will  be  assigned. 

An  office  of  regional  customs  representative  with  jurisdiction  over 
all  Customs  Agency  Service  activities  m  the  Far  East  has  been  estab- 
lished hi  Tokvo,  Japan,  primarily  to  provide  better  control  and  co- 
ordmation  of  enforcement  activities  in  that  area. 

A  new  program  was  developed  and  installed  to  provide  for  system- 
atic uiterviews  of  newly  hired  employees  90  days  after  they  enter  on 


ADMINISTRATIVE    REPORTS  157 

duty.  These  interviews  will  assist  in  improving  selection  and  place- 
ment procedures  and  will  determine  whether  the  employee  is  satis- 
factorily adjusted  to  the  job  and  fully  understands  his  rights,  priv- 
ileges, and  obligations. 

The  new  safety  policy  of  the  Secretary  of  the  Treasury  was  put 
into  effect  and  all  local  safety  programs  were  reviewed.  Steps  were 
taken  to  supply  hearing  protection  devices  to  customs  officers  who 
are  required  to  work  in  close  proximity  to  jet  aircraft. 

A  new  system  for  the  preparation,  issuance,  and  filing  of  circu- 
larized directives  was  installed  during  the  year.  The  more  important 
features  include:  A  reduction  from  ten  to  two  in  the  types  of 
directives;  a  new  format  designed  to  increase  clarity;  and  a  classifica- 
tion system  which  insures  that  all  on  the  same  subject  are  filed 
together.  At  the  same  time  the  number  of  outstanding  directives 
was  reduced  from  5,000  to  1,400. 

The  program  for  the  monthly  reporting  of  statistical  data  by  the 
field  offices  to  the  Washington  headquarters  was  reviewed  and  revised. 
A  new  report  form  was  designed  to  replace  three  separate  forms 
previously  used. 

A  manual  of  auditing  standards  and  techniques  was  prepared  and 
distributed  to  all  comptrollers  of  customs.  The  manual  will  be  used 
as  a  guide  by  customs  auditors  in  performing  onsite  audits  of  customs 
field  offices  and  will  be  useful  in  the  training  of  new  auditors. 

Criteria  were  established  for  use  in  determining  under  what  condi- 
tions a  customs  form  will  be  priced  or  distributed  free.  The  less 
expensive  offset  method  was  adopted  for  printing  certain  forms. 
Savings  realized  to  the  Government  are  expected  to  range  from 
$20,000  to  $40,000  yearly. 

A  forms  improvement  workshop  in  the  office  of  the  U.S.  Appraiser 
of  Merchandise  at  New  York,  N.Y.,  eliminated  55,000  filing  operations 
annually  and  10,000  copies  of  forms  or  form  letters,  the  preparation 
of  17,000  pieces  of  correspondence,  and  142,000  postings.  A  review 
of  locally  reproduced  forms,  using  the  General  Services  Administration 
pamphlet  Forms  Analysis  as  a  guide,  resulted  in  the  elimination  of 
almost  250  forms.  In  addition  the  Washington  headquarters  office 
in  its  review  of  printed  customs  forms  abolished  8,  established  11  new 
forms,  and  revised  55. 

Management  teams  and  officials  from  the  Washington  headquarters 
office  inspected  16  customs  districts  during  the  year.  Manpower 
requirements  were  reevaluated  in  terms  of  existing  and  anticipated 
workloads,  simplified  procedures  were  installed,  and  other  improve- 
ments made  which  resulted  in  the  facilitation  of  trade  and  travel  and 
annual  recurring  savings  of  $30,000. 

A  total  of  762  employee  suggestions  was  received  of  which  213  were 
adopted,  with  awards  of  $5,398.  Identifiable  savings  resulting  from 
adopted  suggestions  amounted  to  $53,399. 

Legislation 

An  important  piece  of  legislation  affecting  customs  business  was 
Public  Law  87-132,  approved  August  10,  1961.     This  law  amended 


158   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

paragraph  1798(c)(2)  of  the  Tariff  Act  of  1930  by  reducing  the  duty 
exemption  for  U.S.  residents  returning  to  the  United  States  on  and 
after  September  9,  1961,  and  before  July  1,  1963.  The  $200  exemp- 
tion under  subdivision  (A)  was  reduced  to  $100  and  the  $300  exemp- 
tion under  subdivision  (B)  was  ehminated. 

Formerly  a  returning  resident  who  had  been  out  of  the  country 
over  12  days  could  bring  in  a  maximum  of  $500  worth  of  personal  and 
household  goods  duty  free.  Under  the  new  law  he  is  entitled  to  only 
$100.  Although  it  was  not  the  purpose  of  this  law  to  produce  revenue, 
there  will  be  some  small  additional  collections.  Its  purpose  was  to 
reduce  U.S.  tourists'  purchases  abroad  and  thus  reduce  the  outflow 
of  U.S.  gold  and  improve  our  balance-of-payments  position. 

Early  indications  are  that  its  purpose  is  being  accomplished. 

Office  of  Defense  Lending 

The  Office  of  Defense  Lending  was  established  on  July  1,  1957, 
by  Treasury  Order  No.  185.  Assigned  to  this  Office  were  the  follow- 
ing functions  which  had  been  transferred  to  the  Secretary  ol  the 
Treasury. 

Activities  under  the  Defense  Production  Act 

The  making  and  administering  of  loans  to  private  business  enter- 
prises under  the  authority  of  section  302  of  the  Defense  Production 
Act  of  1950,  as  amended  (50  app.  U.S.C.  2153),  were  assigned  to  the 
Secretary  of  the  Treasury  by  Executive  Order  No.  10489,  dated 
September  26,  1953.  Under  section  302,  this  Office  can  consider  only 
applications  for  loans  which  are  certified  as  essential  for  national 
defense  purposes  by  the  Office  of  Civil  and  Defense  Mobilization. 
No  new  loans  were  authorized  during  the  fiscal  year  1961. 

On  July  1,  1960,  there  were  loans  outstanding  amounting  to  $162.9 
million  and  deferred  participation  commitments  of  $14.7  million.  By 
the  close  of  fiscal  1961  these  loans  had  been  reduced  to  $121.6  million 
and  commitments  to  $13.6  million. 

Civil  defense  loans 

The  lending  functions  under  section  409  of  the  Federal  Civil  Defense 
Act  were  transferred  to  the  Secretary  of  the  Treasury  on  September 
28,  1953,  pursuant  to  section  104  of  the  Keconstruction  Finance  Cor- 
poration Liquidation  Act  (50  app.  U.S.C.  2261).  Beginning  with 
fiscal  1956  no  administrative  expense  allowance  has  been  authorized 
for  this  program,  and  no  applications  for  new  loans  have  been  accepted. 
On  July  1,  1960,  there  were  loans  outstanding  amounting  to  $904,085 
and  deferred  participation  commitments  of  $2,129,110.  By  June  30. 
1961,  these  loans  had  been  reduced  to  $798,344  and  the  commitments 
to  $1,776,138. 

Liquidation  of  Reconstruction  Finance  Corporation  assets 

Pursuant  to  the  provisions  of  Reorganization  Plan  No.  1  of  1957, 
the  Reconstruction  Finance  Corporation  was  abolished  effective  at 


ADMINISTRATIVE    REPORTS  159 

the  close  of  June  30,  1957.  Its  remaining  assets,  liabilities,  and 
obligations  were  transferred  to  the  Secretary  of  the  Treasury,  the 
Administrator  of  the  Small  Business  Administration,  the  Housing 
and  Home  Finance  Administrator,  and  the  Administrator  of  General 
Services. 

The  Secretary  of  the  Treasury  is  responsible  for  completing  the 
liquidation  of  business  loans  and  securities  with  individual  balances 
of  $250,000  or  more,  securities  of  and  loans  to  railroads,  securities  of 
financial  institutions,  and  the  windup  of  corporate  affairs. 

During  fiscal  1961  there  was  paid  into  the  Treasury  as  miscellaneous 
receipts  $4.5  million,  representing  net  income  and  proceeds  of  liqui- 
dation on  the  various  loans,  securities,  and  commitments.  This 
brought  to  $44.5  million  the  total  paid  into  the  Treasury  since  July  1, 
1957. 

On  June  30,  1961,  the  portfolio  of  RFC  loans,  securities,  and  com- 
mitments amounted  to  $16,1  million,  a  reduction  of  $3.9  million  from 
the  $20  million  outstanding  on  July  1,  1960.  Total  reductions 
efl'ected  have  amounted  to  $39.4  million,  approximately  71  percent 
of  the  portfolio  of  $55.5  million  transferred  to  the  Secretary  of  the 
Treasury  on  Jul}'  1,  1957. 

Bureau  of  Engraving  and  Printing 

The  Bureau  of  Engraving  and  Printing  designs,  engraves,  and  prints 
United  States  currency.  Federal  Reserve  notes,  securities,  postage 
and  revenue  stamps,  and  various  commissions,  certificates,  and  other 
forms  of  engraved  work  for  Government  agencies.  The  Bureau  also 
prints  bonds  and  postage  and  revenue  stamps  for  the  governments  of 
insular  possessions  of  the  United  States. 

Deliveries  of  all  classes  of  work  to  the  customer  agencies  in  the 
fiscal  year  1961  totaled  26,746,227,150  pieces,  as  compared  with 
27,643,428,932  pieces  in  1960,  a  decrease  of  897,201,782,  or  approxi- 
mately 3.2  percent  in  the  deliveries  of  Bureau  products. 

Organizational  matters 

Several  changes  were  made  in  the  organizational  structure  during 
the  year  in  order  to  improve  operating  efficiency.  The  Bureau 
Organization  Manual  was  published  and  distributed.  It  consists 
of  organizational  charts  and  functional  statements  for  all  components 
and  a  list  of  the  organization  staff  and  principal  assistants.  The 
Manual  is  kept  current  through  issuance  of  revised  pages  as  needed. 

Management  attainments 

The  Director  of  the  Bureau  has  held  frequent  meetings  with  the 
Bureau  Management  Advisory  Committee  and  other  management 
and  supervisory  personnel  for  the  purpose  of  exchanging  ideas,  solving 
problems,  and  bringing  about  unproved  operations.  He  has  estab- 
lished and  appointed  members  to  special  committees  to  investigate 
and  make  appropriate  reports  on  special  situations.     He  has  also 


160   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

held  frequent  meetings  with  committees  representing  various  organ- 
ized groups  to  discuss  and  resolve  labor-management  problems. 

An  effective  management  tool  which  the  Bureau  used  throughout 
the  fiscal  yesir  was  the  continuing  review  of  manpower  requirements 
by  which  every  vacancy  is  reviewed,  and  the  position's  absolute  need 
determined  before  a  request  is  made  for  filling  the  vacancy.  In 
addition,  a  special  committee  was  appointed  by  the  Director  to  study 
the  overall  situation  with  the  purpose  of  providing  for  improved 
matipower  utilization.  Since  the  Post  Office  Department  did  not 
order  as  many  postage  stamps  as  had  been  estimated,  and  the  Bureau 
converted  at  an  accelerated  pace  to  processing  all  coils  on  automatic 
equipment,  fewer  employees  were  required.  The  rate  of  spoilage  on 
U.S.  currency,  32-subject,  decreased  and  the  average  production  per 
employee  increased,  thereby  making  it  possible  to  produce  the  cur- 
rency with  fewer  employees.  These  combined  efforts,  together  with 
other  management  unprovements,  were  reflected  in  the  reduction  of 
personnel  from  3,191  employees  at  the  beginning  of  the  fiscal  year  to 
3,038  at  its  close,  a  decrease  of  153. 

^Management  placed  continuing  emphasis  on  the  directive  to  keep 
overtmie  to  an  absolute  minunum,  with  a  resulting  reduction  in  paid 
overthne  from  $277,158  for  fiscal  1960  to  $110,537  for  1961. 

In  the  Bureau's  technological  improvement  program,  extensive 
research  and  development  activities  have  been  conducted  throughout 
the  year.  Management  efforts  were  directed  especially  toward 
making  additional  refinements  and  improvements  in  the  new  equip- 
ment and  processes  employed  in  the  manufacture  of  currency  and 
postage  stamps.  In  an  attempt  to  reduce  spoilage,  a  special  com- 
mittee was  appointed  to  investigate  all  facets  of  the  formulation  and 
manufacture  of  the  printing  inks  used  in  the  production  of  currency. 
This  investigation  covered  the  procurement  of  the  raw  materials 
through  the  printing  operations  in  an  effort  to  identify  the  underlying 
causes  for  the  deficiencies  found  prevalent  in  such  inks.  To  bring 
about  additional  unproved  operations  further  modifications  and  re- 
finements continued  to  be  made  on  the  high-speed  rotary  stamp 
presses  and  on  the  coil  stamp  processing  equipment.  The  Bureau 
has  vigorously  continued  other  research  activities  relating  to  paper, 
tape,  labels,  wrappings,  plate  wear,  presses,  and  equipment,  in  order 
to  bring  about  unprovements  in  the  quality  of  its  products. 

The  Bureau  has  also  conducted  an  active  and  continuing  program 
of  industrial  engineering  studies,  analyses  of  production  processes, 
and  quality  control  surveys,  to  improve  work  methods  and  operations, 
increase  industrial  efficiency,  and  insure  development  and  practice  of 
sound  quality  control  systems. 

Close  liaison  was  maintained  with  representatives  of  the  Depart- 
ment of  Agriculture  relative  to  the  new  food  stamp  program.  Careful 
utilization  of  employees  and  equipment  permitted  successful  com- 
pletion of  food  stamp  coupon  requirements  in  addition  to  the  timely 
completion  of  normal  postage  stamp  book  requisitions. 

Reviews  and  audits  made  by  the  Internal  Audit  Staff  indicate  that 
Bureau  policies  have  been  carried  out  effectively.  Through  financial 
and  management  tyY>e  audits,  areas  were  identified  in  which  substan- 
tial unprovements  in  operations  and  savings  were  made.  In  fiscal 
1961,   74  reports  of  audits,   containing  90  recommendations,   were 


ADMINISTRATIVE    REPORTS  161 

released  and  52  audit  recommendations  were  mider  consideration  by 
the  responsible  offices  at  the  close  of  the  year. 

Through  the  excess  property  program,  the  Bureau  received  $41,908 
from  the  sale  of  obsolete  equipment  and  material  declared  excess  to 
Bureau  needs.  It  obtained  equipment  valued  at  $15,467  at  no  charge 
through  the  Federal  utilization  program. 

Initiated  last  year  the  awards  program  promotional  campaign  of 
presenting  a  pencil  to  each  employee  submitting  a  suggestion  and  one 
to  his  supervisor  was  ended  during  1961,  after  a  total  of  510  pencils 
had  been  issued.  It  is  estimated  that  annual  recurring  savings  of 
$29,283  will  accrue  to  the  Bureau  from  employee  suggestions  adopted 
during  the  fiscal  year.  Through  the  records  management  program,  561 
cubic  feet  of  noncurrent  records  have  been  transferred  from  office 
space  to  the  records  storage  area,  and  250  cubic  feet  of  obsolete  rec- 
ords were  destroyed.  In  the  forms  management  program,  1,084 
requests  for  form  service  were  processed  resulting  in  the  preparation 
of  71  new  forms,  the  elimination  of  129,  and  the  improvement  and 
revision  of  295. 

The  Director  met  with  all  supervisors  and  members  of  safety  com- 
mittees to  reemphasize  his  personal  interest  in  the  Bureau  safety 
program,  and  to  encourage  supervisors  to  give  this  program  their  whole- 
hearted support.  Supervisors  held  similar  meetings  to  stress  the  need 
for  an  all-out  effort  to  reduce  injuries.  Several  new  ideas  were  adopted 
to  intensify  Bureau-wide  interest. 

The  Bureau  conducts  a  continuing  employee  development  program, 
through  which  management  at  all  levels  helps  personnel  acquire  the 
knowledges,  skills,  and  attitudes  needed  to  work  effectively  and  to 
prepare  for  greater  responsibilities.  The  program  encompasses  both 
outside  and  internal  training  and  orientation.  Sixty-five  employees 
concluded  six  supervisory  training  classes  and  were  presented  certifi- 
cates in  appropriate  ceremonies. 

Estimated  savings  resulting  from  management  improvement  efforts 
in  the  Bureau  of  Engraving  and  Printing  for  fiscal  1961  totaled  nine 
man-years  and  approximately  $75,000  on  a  recurring  annual  basis. 
In  addition,  it  is  estimated  that  an  additional  $1,200,000  is  being 
saved  annually  by  the  Government  as  a  result  of  the  development  by 
the  paper  manufacturer  of  a  dry  paper  for  use  in  printing  one  dollar 
silver  certificates  on  high-speed  intaglio  presses.  Use  of  this  dry  paper 
has  increased  the  service  life  of  such  notes  in  circulation  by  an  esti- 
mated 30  percent  over  that  of  notes  printed  by  the  wet  process.  All 
realized  savings  were  applied  against  the  cost  of  products,  and  have 
been  reflected  either  in  the  Bureau's  billing  rates  or  in  decreases  in 
appropriation  requests  by  the  Office  of  the  Treasurer  of  the  United 
States  for  funds  for  the  purchase  of  currency. 
New  issues  of  postage  stamps  and  deliveries  of  finished  work 

New  issues  of  postage  stamps  delivered  by  the  Bureau  in  fiscal 
1961  are  shown  in  table  105.     A  comparative  statement  of  deliveries 
of  finished  work  for  fiscal  1960  and  1961  appears  in  table  106. 
Finances 

The  Bureau  operations  are  financed  by  reimbursements  to  a  work- 
ing capital  fund  authorized  by  law.  Balance  sheets  and  a  statement 
of  income  and  expense  as  of  June  30,  1960  and  1961,  follow. 


162        1961    REPORT    OF    THE    SECRETARY    OF   THE    TREASURY 
Balance  sheets  as  of  June  SO,  1960  and  1961 


Assets 

June  30, 1960 

June  30, 1961 

Current  assets: 

Cash  with  Treasury 

$3, 862, 823 
1, 061,  865 

660, 351 

3, 419, 054 

1, 802, 659 

1, 142, 188 

66, 627 

$3  294  070 

Accounts  receivable .    . 

1  274  673 

Inventories: ' 

Raw  materials 

762,  520 

Work  in  process .  _..  . 

3  669  498 

Finished  goods 

2  996  548 

Stores ..    

1,097  054 

Prepaid  expenses.. - 

61,  396 

Total  current  assets .  . 

12, 015,  567 

13, 155, 759 

Fixed  assets: ' 

Plant  machinery  and  equipment 

19, 998, 338 

86, 247 

188, 823 

445,  467 

3,  955, 961 

2, 133, 428 

34,544 

19, 505, 859 

Motor  vehicles. 

88  317 

OfTice  machines. . 

193  843 

Furniture  and  fixtures 

435  031 

Dies,  rolls,  and  plates 

3  955  961 

Building  appurtenances  _  . 

2  138  720 

Fixed  assets  under  construction 

36,  789 

Less  portion  charged  off  as  depreciation 

26,  842,  808 
10, 101, 572 

26, 354,  520 
11  008  940 

Excess  fixed  assets  (estimated  realizable  value) 

16, 741, 236 
804 

15,  345,  580 
360 

Total  fixed  assets 

16, 742, 040 

15,345  940 

Deferred  charges .. 

174,  742 

104  623 

Totalassets 

28, 932, 349 

28,  606. 322 

Liabilities  and  investment  of  the  Ignited  States 

June  30, 1960 

June  30, 1961 

Liabilities:  3 

Accounts  payable .. 

$595,  544 

926, 175 

1,  365, 674 

177, 299 

675, 087 

5,889 

$400  910 

Accrued  liabilities: 

Pa\Toll 

883  639 

Accrued  leave ___  

1,475  161 

Other 

115,196 

Trust  and  deposit  liabilities 

564, 063 

Other  liabilities 

4  876 

3, 745,  668 

3, 443, 845 

Investment  of  the  United  States  Government: 
Principal  of  the  fund: 

Appropriation  from  the  U.S.  Treasurv 

3, 250, 000 
22, 000, 930 

3. 250, 000 

Donated  assets,  net 

22, 000, 930 

Total  principal 

25, 250, 930 
-64,  249 

25, 250, 930 

Earned  surplus,  or  deficit  (— )  * 

—88  453 

Total  investment  of  the  U.S.  Government 

25, 186, 681 

25, 162, 477 

Total  liabilities  and  investment  of  the  U.S.  Government 

28.932,349 

28,606,322 

'  Finished  goods  and  goods-in-process  inventories  are  valued  at  cost.  Except  for  the  distinctive  paper 
which  is  valued  at  the  acquisition  cost,  raw  materials  and  stores  inventories  are  valued  at  the  average  cost 
of  the  materials  and  supplies  on  hand. 

2  The  act  of  August  4, 1950.  establishing  the  Bureau  of  Engraving  and  Printing  Fund,  specifically  excluded 
from  the  assets  of  the  fund  the  land  and  buildings  occupied  by  the  Bureau  (31  U.S.C.  181a).  These  assets 
are  valued  at  about  $9,000,000.  However,  under  the  Supplemental  Appropriation  Act  of  1961  (74  Stat.  514) 
$1,250,000  was  appropriated  for  emergency  repairs  to  the  Bureau  of  Engraving  and  Printing  Annex  Building. 
Plant  machinery  and  equipment,  furniture  and  fixtures,  ofTice  machines,  and  motor  vehicles  acquired  on  or 
before  June  30, 19.50,  are  stated  at  appraised  values.  Additions  since  June  30,  1950,  and  all  building  appurte- 
nances are  valued  at  acquisition  cost.  Dies,  rolls,  and  plates  were  capitalized  as  of  Julv  1,  1951,  on  the  basis 
of  average  unit  costs  developed  for  fiscal  19.50  reduced  to  recognize  their  estimated  useful  life.  Since  July  1, 
1951,  all  costs  of  dies,  rolls,  and  plates  have  been  charged  to  operations  in  the  year  acquired. 

3  Outstanding  commitments,  consisting  of  undelivered  purchase  orders  and  unperformed  contracts, 
totaled  $3,017,362  on  June  30,  1901,  compared  with  $4,480,585  on  June  30,  1960;  of  these  amounts,  $2,497,766 
on  June  30,  1961,  and  $2,582,783  on  June  30,  1960,  related  to  contracts  entered  into  prior  to  June  30,  but  not 
to  be  performed  until  the  ensuing  fiscal  years. 

<  The  act  of  .\ugust  4,  1950.  provided  that  any  surplus  accruing  to  the  fund  in  any  fiscal  year  be  paid  into 
the  Treasury  as  miscellaneous  receipts  except  that  any  surplus  would  be  applied  first  to  restore  any  impair- 
ment of  capital  by  reason  of  variations  between  prices  charged  and  actual  costs  (31  U.S.C.  181a). 


ADMINISTRATIVE    REPORTS  163 

Statement  of  income  and  expense  for  the  fiscal  years  1960  and  1961 


Income  and  expense 


1961 


Operating  revenue:  Sales  of  engraving  and  printing. 

Operating  costs: 
Cost  of  sales: 

Direct  labor 

Direct  materials  used.. 


Prime  cost. 


Overhead  costs: 

Salaries  and  indirect  labor 

Factory  supplies 

Repair  parts  and  supplies.  _ 

Employer's  contribution  for  retirement  and  life  insurance. 

Rents,  communication,  and  utilities 

Other  services 

Depreciation  and  amortization 

Losses  on  disposal  or  retirement  of  fixed  assets 

Sundry  expenses  (net) 


Total  overhead. 
Total  costs  > 


Less: 


Nonproduction  costs: 

Shop  costs  capitalized 

Cost  of  miscellaneous  services  rendered  other  agencies 

Net  increase,  or  decrease  (— )  in  finished  goods  and  work  in 
process  inventories  -  _ 


Cost  of  sales. 


Operating  loss 

Xonoperating  revenue: 

Sales  of  card  checks 

Operation    and    maintenance 

other  Treasury  activities 

Other  services 


of    incinerator    and  space  utilized  by 


Nonoperating  costs: 

Purchase  of  card  checks 

Freight  out-card  checks 

Other  costs  of  miscellaneous  services  rendered  other  agencies. 


Nonoperating  profit. . 
Net  loss  for  the  year  2. 


$26, 014,  685 


$24, 235,  583 


9,  781, 451 
4, 180,  726 


9, 438, 947 
4, 033,  564 


13, 962, 177 


13, 472, 511 


7. 012,  692 

1,066,341 

258,  339 

1, 125,  312 

453, 352 

538,  907 

1,  972, 205 

25,  530 

21, 995 


7, 184,  555 
1, 110,  591 

246, 372 
1, 294, 445 

457, 983 

293,  681 
1, 945, 966 

236, 308 
9,217 


12, 474, 673 


12,  779, 118 


26,  436, 850 


26, 251, 629 


201, 246 
424, 030 


—203, 477 


115,275 
431. 151 


1, 444, 333 


421,  799 


1,  990,  759 


26,015,051 


24, 260, 870 


366 


25, 287 


1, 186, 101 

361,217 
49, 025 


213, 392 


379, 467 
49, 072 


1,  596, 343 


641, 921 


976, 950 
195, 178 
424, 030 


173, 520 

36, 167 

431, 151 


1,  596, 158 


640. 838 


185 


1,083 


24, 204 


"■  Revised. 

'  No  amounts  are  included  in  the  accounts  of  the  fund  for  (1)  interest  on  the  investment  of  the  Government 
in  the  Bureau  of  Engraving  and  Printing  fund,  (2)  depreciation  on  the  Bureau's  buildings  excluded  from 
the  assets  of  the  fund  by  the  act  of  August  4,  1950,  and  (3)  other  costs  incurred  by  other  agencies  on  behalf 
of  the  Bureau. 

2  The  act  of  August  4, 1950,  provided  that  any  surplus  accruing  to  the  fund  in  any  fiscal  year  be  paid  into 
the  Treasury  as  miscellaneous  receipts  except  that  any  surplus  vs^ould  be  applied  first  to  restore  any  impair- 
ment of  capital  by  reason  of  variations  between  prices  charged  and  actual  costs  (31  U.S.C.  181a). 

Fiscal  Service 


The  Fiscal  Service,  headed  by  the  Fiscal  Assistant  Secretary, 
consists  of  the  OflBce  of  the  Fiscal  Assistant  Secretary,  the  Bureau  of 
Accounts,  the  Bureau  of  the  Public  Debt,  and  the  Office  of  the  Treas- 
urer of  the  United  States. 

In  addition  to  general  supervision  of  the  Fiscal  Service  bureaus, 
the  Fiscal  Assistant  Secretary  is  responsible  for  administration  of  the 
cash  position  of  the  Treasury,  including  the  distribution  of  funds 


164   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

between  Federal  Reserve  Banks  and  other  Government  depositaries; 
participation  in  planning  Treasury  financing  operations ;  general  direc- 
tion of  fiscal  agency  operations  of  the  Federal  Reserve  Banks;  and 
the  Treasury's  central  agency  participation  in  the  joint  financial 
management  improvement  program  along  with  the  Bureau  of  the 
Budget  and  General  Accounting  Office. 

Treasury  Order  No.  148  (Revision  10),  dated  March  2,  1961, 
assigned  to  the  Fiscal  Assistant  Secretary  responsibility  for  general 
supervision  of  the  Office  of  Defense  Lending. 

The  reports  of  the  Bureau  of  Accounts,  Bureau  of  the  Public  Debt, 
and  Office  of  the  Treasurer  of  the  United  States,  which  follow,  explain 
the  operations  under  the  responsibilities  of  the  Fiscal  Assistant 
Secretary. 

BUREAU  OF  ACCOUNTS 

The  Bureau  of  Accounts  was  established  by  the  President's  Re- 
organization Plan  III,  dated  April  2,  1940,  and  reorganized  by  Treas- 
ury Department  Order  No.  164,  dated  December  12,  1952. 

The  Bureau's  functions,  which  are  mainly  of  Government-wide 
scope,  include:  Maintenance  of  the  Government's  system  of  central 
accounts;  issuance  of  the  Government's  central  financial  reports; 
accounting  and  reporting  for  foreign  currencies  in  the  custody  of 
the  Secretary  of  the  Treasury;  disbursing  for  virtually  all  civilian 
agencies  of  the  Government;  participation  with  the  Office  of  the 
Fiscal  Assistant  Secretary  in  the  joint  financial  management  im- 
provement program ;  general  direction  and  designation  of  Government 
depositaries ;  determination  of  qualifications  and  underwriting  limita- 
tions of  surety  companies  to  write  fidelity  and  other  sm-ety  bonds 
to  cover  Government  activities;  investment  of  social  security  and 
other  trust  funds;  administration  of  loans  and  advances  by  the 
Treasury  to  Goverinnent  corporations  and  other  agencies;  technical 
guidance  to  Treasury  bureaus  and  other  executive  agencies  on  ac- 
counting systems  and  related  matters;  and  general  direction  of  fiscal 
internal  auditing  within  the  Department. 

The  Bureau  also  administers  the  payment  of  claims  under  certain 
international  agreements;  maintains  accounts  and  collects  amounts 
due  from  foreign  governments  under  lend-lease  and  other  agree- 
ments; and  performs  such  other  fiscal  work  as  may  be  required. 

Accounting  and  Reporting 
Accounting  systems 

Procedural  changes  resulting  from  operations  of  the  Accounting 
Systems  Division  during  the  fiscal  year  1961  were  as  follows: 

Department  Circular  No.  945  was  revised  on  January  17,  1961, 
modifying  Treasury  accounting  relationships  with  all  agencies  for 
which  the  Treasury  disburses.  Effective  July  1,  1961,  Treasury 
regional  offices  ^^dll  keep  a  single  account  mth  each  agency  account- 
ing station  concerned  in  lieu  of  an  account  for  each  appropriation, 
fund,  or  receipt  classification.  The  agency  accounting  stations  will 
report  to  the  Treasury  monthly  the  transactions  based  on  their  own 
accounts,  classified  by  appropriations,  fund,  and  receipt  accounts. 


ADMINISTRATIVE    REPORTS  165 

Further  information  on  this  subject  is  presented  under  "Central 
Accounting." 

Under  the  joint  financial  management  improvement  program, 
staff  of  the  Accounting  Systems  Division  participated  in  a  study  to 
explore  improvements  in  all  financial  aspects  of  reimbursable  pro- 
grams of  Government  agencies  and  in  continuing  studies  concerning 
accrual  accounting  and  cost-based  budgeting. 

The  staff  also  dealt  with  depositary  receipt  procedures;  prepared 
regulations  for  substitute  checks  drawn  on  depositaries;  developed 
procedures  and  agreements  with  the  Department  of  Labor  required 
by  the  Employment  Security  Act  of  1960  (42  U.S.C.  1101-1104); 
participated  in  fiscal  arrangements  incident  to  food  stamp  operations; 
and  assisted  the  Civil  Service  Commission  on  fiscal  procedures  for 
the  Federal  employees'  health  benefits  program. 

Other  staff  work  included:  Preparation  of  an  accounting  manual 
for  cash  operations  of  the  Treasurer  of  the  United  States;  serving 
on  the  Interbureau  Committee  on  Automatic  Data  Processing; 
assistance  relating  to  new  legislation  on  extended  unemployment 
benefits  and  extension  of  benefits  under  the  Social  Security  Act 
Amendments  of  1961  (75  Stat.  131);  recommendations  on  accounting 
for  seized  property;  and  development  of  the  Department's  annual 
report  for  the  joint  financial  management! improvement  program. 

In  the  departmental  area,  staff  assistance  was  furnished  also  in 
such  matters  as:  Bureau  manuals  and  procedural  instructions;  guide- 
lines for  departmental  accounting  policy;  participation  with  the 
General  Accounting  Office  and  the  Bureau  of  Customs  in  a  study 
of  Customs  accounting;  participation  in  the  electronic  data  process- 
ing program  of  the  Internal  Revenue  Service;  proposals  on  Mint 
financing  and  accounting;  and  assistance  to  the  Bureau  of  Narcotics, 
the  U.S.  Secret  Service,  and  the  Office  of  Administrative  Services 
in  accounting. 

Central  accounting 

The  Division  of  Central  Accounts  maintains  the  central  accounts 
for  the  receipts,  expenditures,  appropriations,  and  related  cash  opera- 
tions of  the  Government  in  accordance  with  section  114  of  the  Budget 
and  Accounting  Procedures  Act  of  1950  (31  U.S.C.  66b),  and  Treasury 
Department  Circular  No.  945,  as  amended.  The  central  accounting 
system  integrates  the  transactions  of  all  collecting  and  disbursing 
officers  and  the  Treasurer  of  the  United  States,  the  appropriation, 
fund,  and  receipt  accounts  of  the  Government,  and  budget  results, 
with  a  disclosure  of  the  related  cash  assets  and  liabilities.  The 
Division  also  prescribes  official  appropriation,  fund,  and  receipt  ac- 
count symbols  and  titles  and  issues  appropriation  warrants  pursuant 
to  law. 

By  means  of  deposit  in  transit  accounts,  the  system  of  central 
accounts  provides  Government-wide  control  with  respect  to  deposits 
reported  by  collecting  and  disbursing  officers  for  credit  to  the  ac- 
count of  the  Treasurer  of  the  United  States.  It  also  provides  overall 
control  concerning  data  on  checks  issued  reported  b}^  disbursing 
officers,  tied  in  with  the  detailed  check  reconciliation  of  disbursing 
officers'  accounts  by  the  Office  of  the  Treasurer  of  the  United  States 


166   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

and  anchored  to  the  expenditure  data  affecting  appropriations  and 
funds. 

The  central  accounts  system  furnishes  the  accounting  base  for 
classified  receipts,  expenditures,  and  other  data  required  for  the  official 
central  reports,  including  for  example,  the  Monthly  Statement  oj 
Receipts  and  Expenditures  of  the  United  States  Government  and  the 
annual  Combined  Statement  of  Receipts,  Expenditures  and  Balances  of 
the  United  States  Government. 

Revised  procedures  were  developed,  effective  July  1,  1961,  whereby 
Treasury  regional  accounting  offices  will  keep  control  accounts  for  the 
aggregate  of  transactions  at  the  level  of  each  agency  accounting  station 
for  which  the  Treasury  disburses.  Agency  accounting  stations  will 
furnish  the  Treasur}'  with  monthly  statements  of  their  transactions 
classified  according  to  the  individual  appropriation,  fund,  and  receipt 
accounts  involved,  based  directl}^  on  their  own  records.  The  classified 
transactions  so  reported  must  be  in  agreement  with  the  control 
accounts  maintained  in  the  Treasury  regional  accounting  offices. 

The  monthly  statements  submitted  by  agency  stations  will  be  taken 
up  in  the  central  accounts,  serving  to  disclose  the  Government's  cash 
operations  and  budget  results.  As  a  result,  the  accuracy  of  classified 
data  in  the  central  accounts  and  validity  of  the  related  financial 
reports,  in  large  measure,  will  rest  on  the  accounts  of  the  administra- 
tive agencies. 

Certificates  of  deposit  and  related  documents  will  be  forwarded  by 
the  Federal  Reserve  Banks  directly  to  the  central  office  of  the  Division 
of  Central  Accounts  instead  of  to  the  Treasury  regional  accounting 
offices.  Agency  stations  will  fm'nish  the  Treasury  with  the  totals  of 
their  deposits,  classified  as  to  the  month  in  which  the  deposits  are 
confirmed  by  depositaries  as  credited  to  the  general  account  of  the 
Treasurer  of  the  United  States.  This  will  be  the  basis  for  maintaining 
the  central  "deposit  in  transit"  accounts  at  the  level  of  each  agency 
accounting  station  within  the  Treasury  disbursing  area,  thereby 
providing  a  direct  accounting  control  between  each  collecting  agency 
making  deposits  and  the  Treasm'er  of  the  United  States. 

The  volume  of  accounting  items  processed  through  the  central  and 
regional  accounting  offices  of  the  Division  of  Central  Accounts  during 
the  fiscal  years  1960  and  1961,  is  shown  in  the  following  tabulation. 


Classiflcation 

Work  volume 

1960 

1961 

Number 

1,  532,  873 

2, 785, 345 

13,  727 

1,449,428 

2, 692, 963 

13,396 

Total    

4,331,945 

4, 155,  787 

Central  reporting 

With  the  collaboration  of  Government  agencies,  staff  of  the  joint 
financial  management  improvement  program,  and  users  of  reports, 
various  central  reporting  improvements  were  made  during  fiscal 
1961. 


ADMINISTRATIVE    REPORTS  167 

A  survey  of  Government-wide  financial  reports  was  made  jointly 
with  the  Bureau  of  the  Budget  and  General  Accounting  Office.  Its 
purpose  was  to  identify  and  review  existing  reports;  to  determine 
whether  they  meet  the  informational  needs  of  persons  who  have  a 
continuing  interest  in  the  Government's  financial  operations;  and  to 
make  recommendations  for  a  coordinated  system  of  reporting  that 
adequately  meets  the  needs  of  the  public.  An  inventory  of  reports 
was  issued  and  many  users  were  interviewed.  As  a  result  of  the  sur- 
vey, a  report  was  submitted  containing  recommendations  for  improv- 
ing the  scope  of  Government- wide  reports. 

A  survey  of  accounts  and  procedures  of  the  Department  of  State, 
with  respect  to  Foreign  Service  and  U.S.  disbm'sing  officers,  was  made 
under  the  joint  financial  management  improvement  program. 

The  principal  reports  compiled  in  the  Division  of  Central  Reports 
are :  The  Monthly  Statement  of  Receipts  and  Expenditures  of  the  United 
States  Government,  the  monthly  statement  of  Budgetary  Appropriations, 
and  Other  Authorizations,  Expenditures  and  Unexpended  Balances,  the 
monthly  Treasury  Bulletin,  the  annual  Combined  Statement  of  Receipts, 
Expenditures  and  Balances  of  the  United  States  Government,  tlie  Annual 
Report  of  the  Secretary  of  the  Treasury,  quarterly  Report  on  Foreign 
Currencies  in  Custody  of  the  Treasury  Department,  and  monthly  and 
quarterly  reports  on  foreign  currency  transactions  under  Public  Law 
480,  as  amended.  Some  improvements  made  in  these  reports  during 
the  year  were  as  follows: 

Monthly  Statem.ent  of  Receipts  and  Expenditures  of  the  United  States 
Government. — Additional  data  were  provided  by  including  a  special 
table  on  interfmid  transactions;  by  further  classification  of  expendi- 
tures according  to  major  functions;  and  by  reporting  transactions  in 
trust  revolving  funds  on  a  gross  basis. 

Combined  Statement  of  Receipts,  Expenditures  and  Balances  of  the 
United  States  Government. — Additional  information  was  provided  by  a 
breakdown  of  unpaid  obligations  as  to  accounts  payable  and  undelivered 
orders. 

Treasury  Bulletin. — Several  new  tables  were  added,  including  a 
statement  of  interfund  transactions  of  budget  receipts  and  expendi- 
tures; nonguaranteed  obligations  of  Federal  agencies  issued  and  out- 
standing; public  debt  securities  held  by  certain  savings  and  loans 
associations  and  other  corporations;  and  a  calendar  year  summary 
table  on  internal  revenue  collections  by  States  and  major  tax  classes. 
The  section  on  financial  statements  of  Government  corporations  and 
public  enterprise  funds  was  expanded  to  include  additional  data  on 
loans  outstanding. 

Control  of  foreign  currencies 

By  legislative  enactments  and  Executive  Order  No.  10900,  dated 
January  5,  1961,  operations  during  the  fiscal  year  1961  continued  to 
expand  in  the  custody,  acquisition,  purchase,  deposit,  transfer,  aiid 
sale  of  foreign  currencies. 

As  a  result  of  legislation,  sales  of  surplus  agricultural  commodities 
for  foreign  currencies  were  increased,  new  programs  financed  with 
foreign  currencies  w^ere  established,  and  additional  dollar  appropria- 
tions were  provided  for  the  purchase  of  currencies  available  for  U.S. 
uses.  The  transfer  of  certain  functions  from  the  Bureau  of  the  Budget 
also  added  to  the  workload  of  the  Bureau  in  foreign  currency  operations. 


168   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Foreign  currency  transactions  in  Treasury  custody  accounts  during 
the  year  are  sunmiarized  as  follows:  Collections  of  currencies  generated 
under  various  Government  programs  amounted  to  the  equivalent  of 
$1,327.5  million;  transfers  for  authorized  uses  without  reimbursement 
amounted  to  the  equivalent  of  $737.8  million;  and  withdrawals  for 
sale  to  Government  agencies  for  dollars,  to  the  equivalent  of  $240.1 
million.  The  balances  in  Treasury  custody  accounts  amounted  to 
the  equivalent  of  $1,323.4  million  on  June  30,  1961,  compared  with 
$1,035.2  million  on  June  30,  1960.  Unexpended  balances  in  agency 
accounts  amounted  to  the  equivalent  of  $1,268.1  million  on  June  30, 
1961,  compared  with  $1,415.1  million  on  June  30,  1960.  Transactions 
and  balances  for  the  fiscal  year  are  shown  in  tables  115  and  116. 

Internal  auditing 

Efforts  were  continued  during  fiscal  1961  toward  attaining  maximmn 
results  from  the  internal  audit  function  in  the  individual  Treasury 
bureaus,  principally  by  advice  and  assistance;  exchanging  internal 
audit  information  and  technicj[ues ;  evaluating  internal  audit  results, 
particularly  in  relation  to  external  audit  findings  of  the  General 
Accounting  Office;  and  otherwise  coordinating  internal  auditing 
throughout  the  Department. 

The  audit  of  unissued  stocks  of  Federal  Reserve  notes  held  in  joint 
custody  by  the  Comptroller  of  the  Currency  and  the  Treasurer  of  the 
United  States  was  conducted  as  of  February  24,  1961,  and  disclosed 
that  all  stocks  were  accounted  for. 
Commodity  Credit  Corporation  appraisal 

The  act  of  March  8,  1938,  as  amended  (15  U.S.C.  713a-l),  required 
the  Secretary  of  the  Treasury,  as  of  each  June  30,  to  appraise  the 
assets  and  liabilities  of  the  Conunodity  Credit  Corporation  to  deter- 
mine its  net  worth.  The  amended  act  defined  asset  values,  for  the 
purpose  of  determining  the  net  worth,  as  the  cost  of  such  assets  to 
the  Corporation;  therefore,  the  appraisal  figure  is  stated  in  terms  of 
realized  losses  or  gains. 

The  appraisal  for  fiscal  1960  disclosed  an  impairment  of  the  capital 
of  the  Corporation  in  the  amount  of  $1,612,108,771.41.  An  act 
approved  June  29,  1960  (74  Stat.  242),  restored  $594,499,006.68  of 
this  impairment,  and  the  balance  was  restored  by  an  act  approved 
July  26,  1961  (75  Stat.  238). 

An  act,  approved  August  17,  1961  (75  Stat. 391),  further  amended 
the  act  by  authorizing  annual  appropriations  for  capital  impairment 
based  upon  the  Corporation's  records,  rather  than  upon  the  Secretary's 
appraisal.  Accordingly,  beginning  with  the  fiscal  year  ended  June  30, 
1961,  the  Secretary  of  the  Treasury  no  longer  is  required  to  make  the 
appraisal. 

Verification  of  cash,  currency,  and  securities  held  in  the  Office  of  the  Treasurer 
of  the  United  States,  as  of  January  30,  1961 

Incident  to  the  change  in  Administration,  a  special  committee 
appointed  by  the  Secretar}^  of  the  Treasury  made  an  audit  of  the 
assets  transferred  to  the  incoming  Treasurer.  The  assets  transferred 
were  verified  as  of  January  30,  1961.  This  involved  an  audit  of  the 
balances  of  cash,  currency,  and  securities  held  in  the  Office  of  the 
Treasurer,  Washington,  D.C.,  as  showm  on  the  Treasurer's  books, 
together  with  the  reserve  stocks  of  cm-rency  held  m  the  vaults  of  the 


ADMINISTRATIVE    REPORTS  169 

Bureau  of  Engraving  and  Printing  and  those  held  for  the  Treasurer 
by  Federal  Reserve  Banks  and  certain  comniercial  banks.  The 
inventory  was  found  to  be  in  agreement  with  the  Treasurer's  account 
balances,  after  taking  into  account  certain  minor  items  in  process  of 
being  recorded. 

Disbursing  Operations 

During  fiscal  1961  the  Division  of  Disbursement,  through  fifteen 
regional  disbursing  offices,  performed  disbursing  services  for  about 
1,500  offices  of  agencies  located  throughout  the  United  States,  its 
possessions,  and  the  Philippines.  The  Division  services  all  executive 
agencies  except  the  military  departments,  the  Post  Office  Department, 
and  a  few  relatively  small  agencies.  The  Division  also  exercises 
technical  supervision  of  disbursing  operations  delegated  by  the  Chief 
Disbursing  Officer  to  U.S.  disbursing  officers  of  the  Department  of 
State  at  embassies  and  consulates  in  foreign  countries,  and  to  assistant 
disbursmg  officers  and  cashiers  attached  to  agencies  located  through- 
out the  United  States  and  foreign  countries.  Under  arrangements 
with  the  Department  of  State  payments  are  made  also  m  behalf  of 
domestic  civilian  agencies  requiring  disbursing  service  in  foreign 
countries. 

The  Minneapolis  regional  disburemg  office  was  closed  as  a  result  of 
the  transfer  of  veterans'  check  issuance  operations  from  that  office 
to  the  Chicago  regional  disbursing  office.  This  completed  the  planned 
closing  of  six  disbursing  offices  incident  to  the  centralization  of  dis- 
bursing activity  for  veterans'  benefits,  coordinated  with  the  related 
accounting  centrahzation  program  in  the  Veterans'  Administration. 

A  computer  system  was  installed  in  the  Chicago  office  in  December 
1960.  By  June  30,  1961,  the  computer  was  being  used  to  process 
about  1.5  million  veterans'  benefit  payments  monthly.  Over  eleven 
million  tax  refund  checks  and  approximately  two  million  national 
service  life  insurance  dividend  checks  were  likewise  prepared  during 
the  first  six  months  of  the  computer  system. 

Preliminary  to  establishing  additional  electronic  data  processing 
systems,  regional  disbursing  offices  began  receiving  tabulating  cards 
from  payment  centers  of  the  Social  Security  Administration  for  use 
in  preparing  new,  adjusted,  and  reinstated  cases,  thereby  reducing 
file  maintenance  work.  New  high-speed  microfilm-checksigning 
machines  were  installed  in  all  regional  offices ;  new  copying  machines 
were  acquired  in  eight  of  the  larger  offices  to  handle  undeliverable 
checks  returned  by  post  offices. 

Significant  improvements  were  made  in  other  areas,  including 
further  conversion  of  payment  files  to  punched  cards,  improved 
machine  operating  techniques;  streamlining  operations  in  regional 
disbursing  offices;  smiplification  of  balancmg  operations;  and  improved 
work  methods  under  a  job  analysis  program  utilizing  firstline  super- 
visors in  analyzing  procedures  and  devising  improvements. 

Recurring  annual  savings  realized  during  the  year  under  the  manage- 
ment improvement  program  amounted  to  $285,403. 

For  fiscal  1961  the  average  unit  cost  for  processing  checks  was 
4.35  cents,  compared  with  4.16  cents  in  1960.  Cost  increases  resulted 
from  an  act  which  became  law  on  July  1,  1960  (5  U.S.C.  1113),  and 


170 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


which  mcreased  sahiry  rates  effective  July  10,  1960,  and  also  from 
nonrecurring  expenditures  for  installing  EDP  equipment  in  the 
Chicago  regional  disbursing  office. 

The  volume  of  work  completed  in  fiscal  1961  as  compared  with 
that  of  1960  was  as  follows: 


Classification 


1960 


1961 


Number 


Payments: 

Social  security -.. 

Veterans'  benefits 

Income  tax  refunds - 

Veterans'  national  service  life  insurance  dividend  program 

Other - 

Adjustments  and  transfers.. 

Savings  bonds  issued.. - 

Total 


134,  639, 684 

61, 673, 858 

36,  731, 288 

4,341,351 

43, 671,  271 

249,  639 

3, 479,  646 


284,  786, 737 


146, 
62, 
40, 
7, 
43, 


249, 107 
736, 556 
317,  753 
096, 822 
386, 926 
250, 683 
739,  793 


303,  777, 640 


Deposits,  Investment,  and  Related  Operations 

Federal  depositary  system 

To  supplement  services  provided  by  the  Treasurer  of  the  United 
States,  the  Secretary  of  the  Treasury  has  designated  the  Federal 
Reserve  Banks  and  commercial  banking  institutions  in  the  United 
States,  insular  possessions,  and  foreign  countries,  as  Government 
depositaries  authorized  to  furnish  Government  agencies  with  a  variety 
of  banking  and  financial  services.  This  includes  more  than  11,500 
commercial  banking  institutions,  some  of  which  provide  more  than 
one  type  of  service.  Deposits  of  Government  collections  with  these 
depositaries  flow  to  the  operating  accounts  mamtained  with  the  Fed- 
eral Reserve  Banks. 

A  summary  of  the  various  types  of  depositary  services  and  the 
number  of  commercial  banking  institutions  which,  as  of  June  30, 
1961,  were  authorized  to  provide  these  services,  is  shown  in  the 
following  table. 


Type  of  services  provided  by  depositaries 


Number  of 

banking 
institutions 


Receive  proceeds  from  deposits  of  taxpayers  and  sale  of  public  debt  securities  for  credit  in 
Treasury  tax  and  loan  accounts - 

Receive  deposits  from  directors  of  internal  revenue,  military  finance  officers,  and  other  Govern- 
ment officers-- 

Maintain  oflScial  checking  accounts  of  postmasters,  clerks  of  United  States  courts,  and  other 
Government  officers 

Furnish  bank  drafts  to  Government  officers  in  exchange  for  collections 

Service  State  unemployment  compensation  benefit  payment  and  clearing  accounts 

Operate  limited  banking  facilities  at  military  installations: 

In  the  United  States  and  its  outlying  areas 

Overseas 


11,340 

856 

4,021 

2,212 

57 

273 
164 


An  act  approved  September  13,  1960  (42  U.S.C.  1101(c)(2)), 
provides  in  part  that  beginning  July  1,  1960,  the  Secretary  of  the 
Treasury  shall  pay  from  the  emplojTnent  security  administration 
account,  Avithin  the  unemployment  trust  fund,  into  the  Treasury  as 


ADMINISTRATIVE    REPORTS  171 

miscellaneous  receipts,  expenses  of  banks  for  servicing  unemployn^ent 
benefit  payment  and  clearing  accounts  which  are  offset  by  the  main- 
tenance of  balances  of  Treasury  funds  with  such  banks. 

Investments 

Under  provisions  of  law  the  Secretary  of  the  Treasury  is  responsible 
for  investing  various  Government  trust  funds.  The  Department 
also  furnishes  investment  services  for  other  funds  of  Government 
agencies  (see  table  64). 

Trust  funds  are  invested  in  marketable  Government  securities  and, 
where  authorized  by  law,  in  special  public  debt  obligations  issued 
specifically  to  the  fund.  The  statutes  authorizing  issuance  of  special 
public  debt  obligations  apply  to  the  major  trust  funds  and  usually 
specify  interest  rates;  in  some  cases  the  Secretary  has  discretionary 
authority  to  estabhsh  the  rate.  Where  specified  by  law,  it  is  either 
a  fixed  rate  or  is  based  on  a  formula  using  the  average  coupon  rates 
on  designated  classes  of  outstanding  Government  securities. 

In  view  of  the  higher  yields  on  marketable  Treasury  obligations 
compared  with  statutory  rates  on  special  obhgations,  the  Treasury 
has  continued  its  efforts  to  achieve  greater  uniformity  in  interest  rates 
by  relating  the  rates  on  special  obligations  to  market  yields.  For 
progress  in  fiscal  1960,  see  the  1960  annual  report,  pp.  22-24.  During 
fiscal  1961  this  objective  was  accomplished  \vith  respect  to  the  Federal 
old-age  and  disabilit}^  insurance  trust  funds.  The  Social  Security 
Amendments  of  1960  (42  U.S.C.  401(d)),  provide  that,  beginning 
October  1,  1960,  the  interest  rate  on  special  obligations  issued  to  these 
trust  funds  shall  be  equal  to  the  average  market  yield,  computed  as  of 
the  end  of  the  month  immediately  preceding  the  date  of  issue,  on  all 
marketable  interest-bearing  public  debt  obligations  not  due  or  callable 
until  4  years  from  the  end  of  such  month. 

Pubhc  Law  87-350,  approved  October  4, 1961  (75  Stat.  770),  contams 
similar  interest  rate  provisions  for  special  obligations  issued  to  the 
civil  service  retirement  and  disability  fund. 

Loans  and  advances  by  the  Treasury 

Pursuant  to  specific  provisions  of  law,  various  Government  corpora- 
tions and  agencies  are  authorized  to  borrow  from  the  Treasury  to 
finance  certain  programs.  The  Bureau  of  Accounts  administers  the 
loan  agreements  and  keeps  the  accounts  for  the  loans  and  for  advances 
and  subscriptions  to  capital  stock  of  U.S.  Government  and  interna- 
tional corporations.  Table  121  shows  the  status  of  loans  and  advances 
as  of  June  30,  1961. 

Surety  bonds 

Certificates  of  authority  for  the  execution  of  bonds  in  favor  of  the 
United  States  are  issued  by  the  Secretary  of  the  Treasury  to  qualified 
corporate  sureties,  under  the  act  of  July  30,  1947  (6  U.S.C.  8).  These 
certificates  are  renewable  annually  as  of  May  1,  and  a  list  of  companies 
holding  such  certificates  is  published  annually  in  the  Federal  Register 
(Department  Circular  No.  570,  Revised).  The  Bureau  examines 
the  applications  of  companies  requesting  authority  to  write  Federal 
bonds  and  currently  reviews  the  qualifications  of  the  companies  so 
authorized.     As  of  June  30,    1961,   a  total  of   198  companies  held 

614359—62 12 


172 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


certificates  of  authority.  A  total  of  40,376  bonds  and  consent  agree- 
ments were  cleared  durins:  the  year  for  approval  as  to  corporate  surety. 

The  act  of  August  9,  1^955  (6  U.S.C.  14),  provided  that  the  head  of 
each  executive  agency  shall  obtain  blanket  position  schedule  or  other 
types  of  surety  bonds  covering  employees  required  by  law  or  adminis- 
trative ruling  to  be  bonded,  with  premiums  to  be  paid  by  the  Govern- 
ment rather  than  by  the  employees.  The  law  permits  the  legislative 
and  judicial  branches  to  follow  the  same  procedure. 

A  summary  follows  of  the  information  reported  by  agencies  for 
transmittal  to  Congress  by  the  Secretary  of  the  Treasury,  showing 
the  number  of  officers  and  employees  covered,  the  aggregate  penal  sums 
of  the  bonds  procured,  and  the  premiums  paid  by  the  Government  as 
of  June  30,  1960  and  1961. 


June  30,  1960 

June  30,  1961 

Number  of  officers  and  employees  covered: 

Kxecutive  branch       .      .                           

920,  575 
1,313 

1,003,613 

1,342 

Total       

921,888 

1,  004,  955 

Aggregate  penal  sums  of  bonds  procured: 

Executive  branch 

$3, 239, 950,  525 
10,  337,  000 

$3,  522,  501,  050 

10,317,000 

Total    

3, 250,  287,  525 

3,  532, 818, 050 

Total  premiums  paid  by  Government:  ' 

278, 108 
2,190 

285,  589 

2,268 

Total    

280, 298 

287. 857 

Administrative  expenses: 

35,  078 
565 

38,  515 

595 

Total 

35,  643 

39,110 

I  Premiums  on  bonds  are  shown  on  the  basis  of  the  proportionate  costf  or  one  year,  together  with  the  pre- 
miums on  onc-ycar  bonds  in  order  to  arrive  at  an  annual  rate. 

Foreign  Indebtedness 
World  War  I 

The  Treasury  received  during  fiscal  1961  semiannual  payments 
totaling  $396,421.86  due  from  the  Government  of  Finland  under 
funding  and  moratorium  agreements  covering  World  War  I  indebted- 
ness. In  accordance  with  the  act  of  August  24,  1949  (20  U.S.C.  222) 
these  funds  were  used  to  finance  certain  educational  exchange  pro- 
grams with  Finland.  Tables  117  and  118  show  the  status  of  W^orld 
War  I  indebtedness  of  foreign  governments  to  the  United  States. 

World  War  II 

Under  lend-lease  and  suj'plus  property  agreements,  debtor  govern- 
ments made  dollar  payments  aggregating  $126.6  million  (including 
the  dollar  value  of  silver  repayments)  and  payments  in  foreign  cur- 
rencies equivalent  to  $21.6  million.  Since  inception  of  these  programs, 
total  credits  to  debtor  governments  have  amounted  to  $3,406.3  million 
as  indicated  in  table  120  which  shows  the  status  as  of  June  30,  1961. 


ADMINISTRATIVE    REPORTS  173 

By  agreement  of  January  30,  1958,  France  was  granted  an  option 
to  defer  until  1981,  1982,  and  1983  its  annual  installments  originally 
payable  under  lend-lease  and  surplus  property  agreements  on  July  1, 
1958,  1959,  and  1960,  respectively.  Accordingly,  installment  payments 
of  $29,112,102.65  and  $29,571,476.62,  which  became  due  July  1,  1958, 
and  July  1,  1959,  respectively,  were  deferred  to  July  1,  1981,  and  1982. 
The  installments  due  on  July  1,  1960,  and  July  1,  1961,  including 
interest  on  the  deferred  installments,  were  received  on  the  dates  due, 
as  indicated  in  table  120. 

Credit  to  the  United  Kingdom 

Under  the  terms  of  the  financial  aid  agreement  of  December  6,  1945, 
the  United  Kingdom  borrowed  from  the  United  States  $3,750,000,000, 
repayable  in  50  annual  installments  beginning  December  31,  1951. 
The  agreement  was  amended  on  March  6,  1957,  to  allow  the  United 
Kingdom  to  defer  any  seven  principal  and  interest  installments  due 
after  1956,  with  interest  at  the  rate  of  2  percent  per  annum  on  deferred 
installments.  The  United  Kingdom  exercised  this  option  by  deferring 
the  interest  installments  due  in  1956  and  1957,  amounting  to  $70,385,- 
447.48  and  $69,406,431.45,  respectively.  The  principal  installment 
of  $49,929,818.55  due  in  1957  was  also  deferred.  The  installment  due 
December  31,  1960,  consisting  of  $52,985,922.90  in  principal  and 
$70,144,761.05  in  interest  was  received.  As  of  June  30,  1961,  cumu- 
lative payments  on  principal  amount  to  $435,539,749.13,  leaving  a 
principal  balance  of  $3,314,460,250.87  plus  deferred  interest  install- 
ments of  $139,791,878.93,  or  a  total  balance  of  $3,454,252,129.80. 

Germany,  postwar  (World  War  II)  economic  assistance 

Under  the  External  Debt  Settlement  Agreement  with  the  Federal 
Republic  of  Germaiiy,  dated  February  27,  1953,  Germany  agreed  to 
repay  to  the  United  States  $1  billion  in  semiannual  installments  over 
a  period  of  twenty-five  years  for  postwar  (World  War  II)  economic 
assistance.  Under  a  supplemental  agreement,  dated  April  25,  1961, 
providing  for  an  advance  payment  of  $587,000,000,  the  United  States 
received  on  April  28,  1961,  $487,000,000  and  also  deutsche  marks 
equivalent  to  $100,000,000,  which  by  September  1,  1961,  had  been 
converted  into  dollars. 

Claims  Against  Foreign  Governments  and  Nationals 

Foreign  Claims  Settlement  Commission 

Under  the  International  Claims  Settlement  Act  of  1949,  as  amended 
(22  U.S.C.  1642-1642p),  the  Foreign  Claims  Settlement  Commission 
has  docketed  over  4,000  claims  of  American  nationals  for  losses 
resulting  from  the  taking  of  property  by  the  Government  of  Czecho- 
slovakia. In  March  1960  the  Commission  began  certifying  awards 
to  the  Secretary  of  the  Treasury,  for  payment  under  the  order  of 
priority  prescribed  in  the  act.  Pa^Tuents  will  be  made  within  the 
limits  of  funds  realized  from  the  sale  of  certain  blocked  Czechoslo- 
vakian  assets.  Subject  to  the  adequacy  of  the  fund,  initially,  all 
awards  of  $1,000  or  less  are  to  be  paid  in  fidl,  and  those  larger  than 
$1,000  are  to  be  paid  to  the  extent  of  $1,000,  with  additional  pro  rata 


174   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

pajonents  to  be  made  until  the  fund  is  exhausted  or  until  all  awards 
have  been  paid  in  full.  The  status  of  the  Czech oslovakian  claims 
fund  as  of  June  30,  1961,  foUows, 

Awards  certified  to  the  Treasury  (through  June  30, 1961) : ' 

Number  of  awards 1,629 

Amount  of  awards - ..- $7,971,961.37 

Deposits  in  claims  fund ..- 8,990,282.54 

Statutory  deduction  for  administrative  expenses 449,514. 13 

Amount  available  for  payment  ou  awards 8,540,768.  41 

Payments  on  awards 999,234. 17 

Balance  in  claims  fund - - - -- --- 7,541,534.24 

1  The  Foreign  Claims  Settlement  Commission  has  until  August  1962  to  complete  its  adjudication  of 
Czechoslovakian  claims. 

Pursuant  to  the  International  Claims  Settlement  Act  of  1949,  as 
amended  (22  U.S.C.  1641-1641q),  the  Foreign  Claims  Settlement 
Commission  has  completed  its  affairs  concerning  the  Bulgarian,  Hun- 
garian, Italian,  Rumanian,  and  Soviet  claims  programs.  In  addition 
to  an  initial  payment  of  up  to  $1,000  on  all  awards  under  these  pro- 
grams, pro  rata  payments  have  been  authorized,  consisting  of  two  from 
the  Rumanian  claims  fund,  three  from  the  Bulgarian  claims  fund, 
and  one  from  the  Soviet  claims  fund.  The  Italian  awards,  including 
accrued  interest,  have  been  paid  in  full.  Additional  funds  for  further 
payments  on  the  Soviet  awards  are  not  expected. 

The  origin  and  history  of  the  claims  of  American  nationals  against 
these  five  governments  are  summarized  in  the  1958  annual  report, 
page  112.  For  status  of  the  claims  funds  as  of  June  30,  1961,  see 
table  110. 

On  July  16,  1960,  the  Governments  of  Poland  and  the  United 
States  signed  an  agreement  for  the  settlement  of  claims  of  American 
nationals,  whereby  Poland  will  pa.y  $40,000,000  to  the  United  States 
in  annual  installments  of  $2,000,000.  On  January  10,  1961,  the  first 
installment  was  received.  The  Foreign  Claims  Settlement  Commis- 
sion is  now  accepting  claims  from  American  nationals  against  the 
Government  of  Poland. 

Mixed  Claims  Commission,  United  States  and  Germany 

On  April  3,  1961,  the  Treasury  received  the  annual  payment  of 
$3,700,000  due  from  the  Federal  Republic  of  Germany,  in  partial  settle- 
ment of  World  War  I  debts,  under  the  agreement  of  February  27,  1953. 
These  funds  were  used  for  an  additional  distribution  to  award-holders 
amounting  to  8.2  percent  of  the  interest  accrued  on  Class  III  awards 
(those  over  $100,000),  which  includes  the  award  under  Private  Law 
509,  approved  July  19,  1940.  The  status  of  the  claims  fund  as  of 
June  30,  1961,  is  shown  in  table  107. 

Divested  property  of  enemy  nationals 

As  of  June  30,  1961,  there  was  on  deposit  in  the  Treasury,  a  balance 
of  $800,748,  representing  the  net  proceeds  of  property  divested  by 
the  Attornev  General  of  the  United  States  pureuant  to  the  act  of 
August  9,  1955  (22  U.S.C.  1631a(a)).  The  funds  are  being  held  in 
the  names  of  individuals  who  are  nationals  of  Bulgaria  ($89,376), 
Hungary  ($407,787),  and  Rumania  ($303,585).     Through  June  30, 


ADMINISTRATIVE    REPORTS  175 

1961,  refunds    totaling    $54,859  had  been  made  to  individuals,   as 
authorized  by  the  Department  of  Justice. 

Other  Operations 
Management  improvement  program 

The  continuing  search  for  operating  economies  during  fiscal  1961 
resulted  in  the  adoption  of  improvements  creating  annual  recurring 
savings  of  $297,750,  which  includes  the  amount  of  $285,403  realized 
in  disbursing  operations  mentioned  in  an  earlier  paragraph. 

Incentive  awards  program. — Supervisors  at  all  levels  are  contmually 
urged  to  promote  additional  interest  in  the  program  and  encourage 
employees  to  submit  worthwhile  suggestions  to  improve  operations 
and  reduce  costs.  During  the  year,  376  suggestions  were  received; 
207  were  adopted.  This  compares  favorably  with  fiscal  1960,  when 
296  suggestions  were  received  and  147  adopted. 

Safety  prograrn. — Designated  employees,  on  a  rotational  basis, 
make  monthly  inspections  of  all  space  occupied  by  the  Bureau. 
This  is  accomplishing  the  objective  of  eliminating  safety  hazards 
and  creating  widespread  awareness  of  the  importance  and  benefits  of 
the  accident  prevention  program.  Arrangements  have  been  made 
for  the  attendance  of  certain  supervisors  at  supervisory  safety  train- 
ing courses  sponsored  by  the  Department  of  Labor. 

Personnel  administration. — A  program  of  biannual  surveys  of  per- 
sonnel administration  in  regional  offices  has  been  initiated.  Surveys 
in  the  Kansas  City  and  Philadelphia  offices  were  completed  during 
the  year. 

Training. — The  Bureau's  training  piogram  continues  to  emphasize 
the  four  basic  areas — executive  development,  supervisory  develop- 
ment, self-improvement,  and  skills  training.  A  new  supervisory 
training  course  was  introduced,  dealing  with  such  common  supervi- 
sory problems  as  planning  and  organizing  work,  training  new  employ- 
ees, and  human  relations. 

The  Bureau  expanded  its  skills  trammg  program  to  provide  qualified 
programmers  for  its  new  electronic  data  processing  mstallations. 
In  conjunction  with  the  Civil  Service  Commission,  a  test  was  de- 
veloped for  selection  of  employees  with  programming  aptitudes. 
The  test  results,  coupled  with  evaluations  of  applicants  by  supervisors, 
provided  an  effective  basis  for  selection.  This  procedure,  incorpo- 
rated in  a  training  agreement  for  digital  computer  programmers,  was 
approved  by  the  Civil  Service  Commission  and  will  be  used  in  staf- 
fing future  installations. 

Donations  and  contributions 

During  the  year  the  Bureau  of  Accounts  deposited  "conscience 
fund"  contributions  totaling  $39,296  and  other  unconditional  dona- 
tions totalmg  $205,612,  including  a  single  bequest  of  $20,558.  Other 
Government  agencies  deposited  "conscience  fund"  contributions  and 
unconditional  donations  amounting  to  $22,406  and  $5,610,  respec- 
tively. Conditional  gifts  amounting  to  $5,936  were  received  to  fur- 
ther the  defense  effort. 

In  accordance  with  the  act  of  June  27,  1901  (75  Stat.  119),  au- 
thorizing Government  acceptance  of  gifts  of  money  or  propertj^  to 
reduce  the  public  debt,  a  special  account  was  established  on  the  books 


176   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

of  the  Treasury.  Amounts  of  such  gifts  credited  to  the  special  ac- 
count, including  the  proceeds  of  real  or  personal  property,  will  be 
used  to  purchase  and  retire  public  debt  securities. 

Government  losses  in  shipment 

The  Government  Losses  in  Shipment  Act  of  July  8,  1937,  as 
amended  (5  U.S.C.  134-134h;3lU.S.C.  528,  738a,  757c(i)),  established 
a  self-insurance  plan  supplanting  contracts  with  private  insurance 
companies.  Under  the  act  the  Government  assumes  the  risk  on  its 
shipments  of  money,  bullion,  securities,  and  other  valuables.  Pay- 
ments are  made  from  a  revolving  fund  for  valuables  lost,  destroyed, 
or  damaged  while  in  shipment,  for  losses  incurred  in  the  erroneous 
payment  of  U.S.  savmgs  bonds  by  paying  agents,  and  for  certain 
losses  by  the  Postal  Service.  Claims  totaling  $86,266  were  paid  in 
fiscal  1961;  recoveries  amounted  to  $172.  For  details  concerning 
operations  under  the  act,  see  table  129. 
Deposits  of  interest  charged  on  Federal  Reserve  notes 

The  Board  of  Governors  of  the  Federal  Reserve  System  is  authorized 
by  section  16  of  the  Federal  Reserve  Act,  as  amended  (12  U.S.C.  414), 
to  charge  Federal  Reserve  Banks  interest  on  the  amount  of  unre- 
deemed Federal  Reserve  notes  issued  to  the  Banks  in  excess  of  gold 
certificates  held  as  collateral  against  the  notes.  By  exercising  this 
authority,  annual  interest  payments  equal  to  approximately  90  per- 
cent of  the  net  earnings  of  the  Federal  Reserve  Banks  have  been  made 
to  the  Treasury  from  1947  through  1958,  and  beginning  with  calendar 
year  1959,  100  percent  of  the  net  earnings,  afterpayment  of  statutory 
dividends  to  member  banks. 

The  deposit  in  fiscal  1961  was  $788,129,485.02;  total  deposits  since 
1947  aggregate  $5,607,128,810.77  (see  table  20). 
Payment  of  pre-1934  Philippine  bonds 

In  accordance  with  the  act  of  August  7,  1939,  as  amended  (22  U.S.C. 
1393 (g)(4) (5)),  the  Treasury  maintains  a  trust  account  for  deposits 
by  the  Philippine  Government,  representing  principal  and  interest 
on  pre-1934  bonds  of  the  Philippines.  For  the  status  of  the  account 
as  of  June  30,  1961,  see  table  82. 

Withheld  foreign  checks 

Delivery  of  U.S.  Government  checks  to  payees  residing  in  certain 
foreign  areas  continued  to  be  prohibited  during  fiscal  1961  in  accord- 
ance with  Department  Circular  No.  655,  dated  March  19,  1941,  as 
amended.  These  foreign  areas  are  listed  in  the  1960  annual  report, 
page  117. 

Withholding  of  income  taxes  for  States,  etc. 

Additional  agreements  under  the  act  of  July  17,  1952,  as  amended 
(5  U.S.C.  84b,  84c),  for  withholding  State  income  taxes  from  the 
compensation  of  Federal  employees  were  entered  into  with  West 
Virginia,  Missouri,  and  New  Mexico.  A  new  agreement  with  Okla- 
homa was  made  necessary  by  passage  of  a  new  withholding  tax  law 
by  that  State. 

Depositary  receipts 

Under  provisions  of  the  Internal  Revenue  Code,  employers  are 
required  to  withhold  from  salaries  of  employees  amounts  of  Federal 


ADMINISTRATIVE    REPORTS 


177 


income  and  Federal  Insurance  Contribution  Act  (FICA)  taxes. 
Regulations  provide  that  where  the  total  taxes  withheld  plus  the  FICA 
tax  on  the  employer  exceed  $100  each  month,  the  taxes  must  be  paid 
in  monthly  to  the  Treasury,  with  a  depositary  receipt,  through  a  local 
Government  depositary  designated  for  that  purpose  or  directly  to  a 
Federal  Reserve  Bank.  Depositary  receipts  are  validated  by  Federal 
Reserve  Banks  and  returned  to  employers,  to  be  used  as  evidence  of 
payment  accompanying  their  quarterly  tax  returns  to  District  Direc- 
tors of  Internal  Revenue. 

In  1944  when  the  depositary  receipt  procedure  was  initiated  only 
the  deposit  of  withheld  income  taxes  was  covered  (26  U.S.C.  3402). 
Withholding  requirements  were  extended  to  cover  FICA  taxes,  begin- 
ning in  1950  (26  U.S.C.  3101  and  3111);  railroad  retirement  taxes, 
beginning  in  1951  (26  U.S.C.  3201  and  3221);  and  certain  excise  taxes, 
beginning  in  1953  (Section  477.2(b)  of  Treasury  Decision  No.  6025, 
approved  July  31,  1953).  As  indicated  in  the  following  table,  there 
have  been  substantial  increases  in  the  annual  volume  of  depositary 
receipts  since  inception  of  the  accelerated  collection  system.  These 
increases  are  attributable  to  the  extensions  to  additional  classes  of 
taxes  in  the  earlier  years,  as  well  as  increased  tax  rates,  growth  in  the 
number  of  employers  and  employees,  and  the  results  of  enforcement 
activities  of  the  Internal  Revenue  Service  m  connection  with  the 
monthly  payment  requirements. 


Period 

Income  and 

social 

secui'ity 

taxes 

Railroad 

retirement 

taxes 

Federal 
excise 
taxes 

Total 

1944 _ 

3,  516, 012 
3,  527, 611 
3,699,158 
3,  887,  630 

3,  989, 195 
3, 922, 399 
4, 481,  451 

4,  664, 374 

4,  895,  784 

5,  600, 904 
5,  425,  723 
6, 316,  929 
7, 632,  789 
8, 142, 296 
8,481,465 
8,961,762 
9, 469, 057 
9, 908, 068 

3,516,012 

1945 

3,  527,  611 

1946 

3,699  158 

1947 

3,  887,  630 

1948 

3,989  195 

1949 

3, 922,  399 

1950 

4,481,451 

1951 

4,  664, 374 

1952.... 

10, 802 
11,395 
11,025 
11,128 
11,707 
12,  776 
10,  947 
10,  751 
10, 625 
10,  724 

4, 906,  586 

1953 

5,  612, 299 

1954 

701,243 
652, 971 
694, 125 
682, 014 
681,210 
604, 933 
598,881 
618, 971 

6, 137, 991 

1955 

6, 981, 028 

1956 .     . 

8, 338,  621 

1957 . 

8, 837, 086 

1958 .              -        .  .     . 

9, 173, 622 

1959 

9,  577,  446 

1960 

10, 078,  563 

1961 

10,  537,  763 

BUREAU  OF  THE  PUBLIC  DEBT 

The  Bureau  of  the  Public  Debt,  in  support  of  the  management  of  the 
public  debt,  has  responsibility  for  the  preparation  of  Treasury  Depart- 
ment circulars  offering  public  debt  securities,  the  direction  of  the 
handling  of  subscriptions  and  making  of  allotments,  the  formulation 
of  instructions  and  regulations  pertaining  to  each  security  issue,  the 
issuance  of  the  securities,  and  the  conduct  or  direction  of  transactions 
in  those  outstanding.  The  Bureau  is  responsible  for  the  final  audit 
and  custody  of  retired  securities,  the  maintenance  of  the  control 
accounts  covering  all  public  debt  issues,  the  keeping  of  individual 
accounts  with  owners  of  registered  secmities   and  authorizing  the 


178   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

issue  of  checks  in  payment  of  interest  thereon,  and  the  handhng  of 
claims  on  account  of  lost,  stolen,  destroyed,  or  mutilated  securities. 

Of  the  four  offices  maintained,  the  principal  one,  including  the 
headquarters  of  the  Bureau,  is  in  Washington,  D.C.  This  office  is 
charged  with  the  receipt  and  custody  of  all  new  securities  and  their 
issuance  directly  to  o\vners  or  to  the  Federal  Reserve  Banks  and 
branches  or  other  authorized  issuing  agents.  Except  for  savings 
bonds  the  office  conducts  transactions  in  all  outstanding  securities  (in- 
cluding securities  of  the  Government-owned  corporations  for  which 
the  Treasury  acts  as  agent),  and  audits  and  maintains  custody  of  the 
securities  when  retired  and  interest  coupons  when  paid.  A  depart- 
mental office  in  Chicago,  111.,  conducts  transactions  relating  to  savings 
bonds  outstanding  and  maintains  the  issue  and  retirement  records  of 
the  paper  type  savings  bonds.  A  field  branch  audit  office  in  Cin- 
cinnati, Ohio,  audits  retired  paper  type  savings  bonds  and  transmits 
retirement  information  to  the  Chicago  office  for  recording.  All  issue 
and  retirement  records  of  the  punch-card  type  savings  bonds  are  pre- 
pared and  maintained  in  a  field  office  in  Parkersburg,  W.  Va.,  where 
the  major  auditing,  accounting,  and  record  keeping  operations  are 
performed  by  a  large  scale  electronic  data  processing  system. 

Under  Bureau  supervision  many  transactions  in  pubhc  debt  securi- 
ties are  conducted  by  the  Federal  Reserve  Banks  and  their  branches 
as  fiscal  agents  of  the  United  States.  Selected  post  offices,  private 
financial  institutions,  industrial  organizations,  and  others  (approxi- 
mately 19,100  in  all)  cooperate  in  the  issuance  of  savings  bonds;  and 
about  15,500  private  financial  institutions  redeem  savings  bonds. 
Management  improvement 

Since  1958  the  Parkersburg  office  of  the  Bureau  has  employed 
electronic  data  processing  equipment  to  audit  and  account  for  all 
issues  and  retirements  of  punch-card  Series  E  savings  bonds,  to 
establish  and  maintain  alphabetical  and  numerical  registration 
records  of  these  bonds  on  magnetic  tape,  and  service  the  accounts  of 
the  registered  owners.  Because  of  the  substantial  progress  in  the 
development  of  new  computers  offering  greater  capacity  and  speed  at 
reduced  costs,  a  committee  of  Bureau  personnel  made  a  study  to 
determine  the  feasibility  of  converting  to  a  new  system.  On  the 
basis  of  the  committee's  findings  and  recommendations,  the  updating 
of  the  present  system  with  more  modern  transistor  equipment  has 
been  approved.  The  changeover  is  scheduled  for  the  latter  part  of 
fiscal  1962. 

Until  a  decision  was  reached  that  updating  the  system  was  feasible, 
the  operations  of  the  present  equipment  were  under  continuing 
review.  Significant  savings  in  central  processor  and  peripheral  equip- 
ment time,  and  in  the  cost  of  related  operations,  resulted  from  modi- 
fications in  basic  controlling  programs  and  routines.  Examples  of 
these  developments  included  a  new  compact  type  of  listing  for  use 
in  the  manual  audit  of  out-of-balance  batches;  new  routines  which 
facilitated  updating,  stockpiling,  sorting,  and  file  merging  operations; 
and  a  series  of  new  programs  for  use  in  the  zero  balance  and  classi- 
fication operations.  The  documentation  of  all  current  programs  also 
has  been  completed.     This  documentation  includes  a  description  of 


ADMINISTRATIVE    REPORTS  179 

each  program  with  accompanying  flow  charts,  program  cards,  exhibits, 
and  complete  operational  instructions. 

In  addition  to  electronic  equipment,  the  Bureau  uses  a  variet.y  of 
electric  accounting,  microfilming,  and  other  type  machines.  Sub- 
stantial savings  will  be  realized  from  a  wide  range  of  projects  com- 
pleted during  the  year  as  a  result  of  the  regular  anal3"sis  of  the  utiliza- 
tion of  this  equipment.  In  some  cases  these  savings  will  result  from 
the  installation  of  faster  or  more  versatile  equipment  to  replace  older 
models  or  perform  new  functions;  in  other  cases  the  savings  will  result 
from  the  expanded  utilization  of  the  present  equipment  through  the 
further  mechanization  of  operations  or  more  efficient  workload 
scheduling. 

Among  the  procedural  studies  completed  during  the  year  were  two 
which  were  designed  to  improve  service  to  the  public  by  expediting 
the  issue  and  deliver}^  of  securities  to  their  owners.  One  study  con- 
cerned the  original  issue  of  registered  marketable  securities  in  certain 
types  of  redemption-exchange  transactions.  In  these  transactions 
a  faster  issuance  of  new  securities  will  be  attained  by  a  change  in  the 
procedures  followed  by  the  fiscal  agents  in  submitting  to  the  Depart- 
ment the  securities  to  be  redeemed  and  the  controlling  redemption 
and  issue  documents.  The  second  study  related  to  the  issue  of  replace- 
ment bonds  to  owners  of  punch-card  Series  E  savings  bonds  who  allege 
the  nonreceipt  of  their  bonds.  Procedures  were  revised  to  provide  for 
the  direct  submission  to  the  Parkersburg  office  of  requests  for  the 
entry  of  caveat  as  a  preliminary  to  the  issuance  of  the  replacement 
bonds.  A  new  special  form,  adopted  concurrently,  combines  a  punch 
card  for  use  in  searching  the  magnetic  tape  record  and  recording  the 
caveat,  with  paper  components  which  serve  as  action  copies  for  the 
Chicago  office  and  fiscal  agents.  The  procedural  change  and  use  of 
the  new  form  have  expedited  the  entry  of  caveats,  eliminated  process- 
ing steps  and  paperwork,  and  accelerated  the  issue  of  the  replacement 
bonds. 

The  Bureau  has  initiated  a  project  to  codify  and  issue  all  instruc- 
tions relating  to  administrative  and  operating  procedures  in  a  revisable 
manual  for  the  guidance  of  the  Federal  Reserve  Banks  and  others  in 
their  conduct  of  securities  transactions  as  fiscal  agents. 

Continued  emphasis  has  been  placed  on  the  training  program,  and 
especially  upon  participation  in  management  and  technical  courses 
offered  by  outside  sources.  The  Director  of  the  Parkersburg  office 
participated  in  a  Conference  for  Federal  Executives  sponsored  by  the 
Brookings  Institution;  an  assistant  division  chief  attended  a  four- 
week  course  offered  by  the  American  Management  Association;  and 
other  employees  engaged  in  outside  training  in  various  aspects  of 
electronic  and  other  types  of  data  processing,  forms  management, 
personnel  functions,  office  equipment  operation,  and  financial  man- 
agement. Intensive  training  in  programming  the  new  electronic  data 
processing  system  was  also  begun  in  the  Parkersburg  office. 

Under  the  incentive  awards  program  in  fiscal  1961,  224  suggestions 
were  submitted  and  103  adopted,  with  savings  estimated  at  $23,010. 
Cash  awards  totaling  $1,745  were  made  for  91  of  the  adopted  sug- 
gestions. Cash  awards  totaling  $15,000  were  given  to  100  employees 
who    received    outstanding    performance    ratings.     An     additional 


180 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


$20,071  was  distributed  to  525  employees  for  superior  work  perform- 
ance, including  7  group  awards  for  82  people. 

Bureau  operations 

The  public  debt  of  the  United  States  falls  into  two  broad  categories: 
public  issues  and  special  issues.  The  public  issues  consist  of  market- 
able Treasury  bills,  certificates  of  indebtedness,  notes,  and  bonds;  and 
nonmarketable  obligations,  chiefly  U.S.  savings  bonds  and  Treasury 
bonds  of  the  investment  series.  Special  issues  of  certificates,  notes, 
and  bonds  are  made  by  the  Treasury  directly  to  various  Government 
trust  and  certain  other  accounts  and  are  payable  only  for  these 
accounts. 

During  fiscal  1961  the  gross  public  debt  increased  by  $2,640  million 
and  the  guaranteed  obligations  not  owned  by  the  Treasury  increased 
by  $100  million.  The  most  significant  changes  in  the  composition  of 
the  outstanding  debt  during  the  year  were  tlie  net  increase  of  $3,303 
million  in  interest-bearing  marketable  public  issues,  principally  Treas- 
ury bills  and  notes,  and  the  net  decrease  of  $1,016  million  in  interest- 
bearing  nonmarketable  public  issues,  principally  Treasury  bonds  of  the 
investment  series.  Total  public  debt  issues,  including  issues  ex- 
changed for  other  securities,  amounted  to  $176,248  million  during 
1961,  and  retirements  amounted  to  $173,608  million. 

A  summary  of  public  debt  operations  handled  by  the  Bureau  ap- 
pears on  pages  80  to  97  of  this  report,  and  a  series  of  statistical  tables 
dealing  with  the  public  debt  will  be  found  in  tables  23  to  55.  The 
following  statement  gives  a  comparison  of  the  changes  during  the 
fiscal  years  1960  and  1961  in  the  various  classes  of  public  debt  issues. 


Classification 


Increase,  or  decrease  (— ) 


In  millions  of  dollars 


Interest-bearing  debt: 

Marketable  obligations 

Treasury  bonds,  investment  series 

U.S.  savings  bonds 

Special  issues 

Other. _. 

Total  interest-bearing  debt 

Matured  debt  and  debt  bearing  no  interest 

Total - 


5,818 

-1,582 

-2,  959 

144 

-13 


1,408 
217 


1,625 


3,303 
-953 

-30 
144 

-34 


2,430 
210 


2,640 


U.S.  savings  bonds. — The  large  volume  of  work  involved  in  connec- 
tion with  the  issuance  and  redemption  of  savings  bonds  creates  the 
greatest  number  of  administrative  problems  for  the  Bureau  of  the 
Public  Debt.  Because  these  bonds  are  issued  in  registered  form  and 
are  owned  by  tens  of  millions  of  persons,  both  alphabetical  and  nu- 
merical ownership  records  must  be  established  and  maintained  for  2.3 
billion  bonds  issued  during  the  past  twenty-six  years.  The  adjudicat- 
ing of  clahns  and  replacing  lost,  stolen,  and  destroyed  bonds  (which 
now  total  1.6  million  pieces),  handling  and  recording  retired  bonds, 
and  conducting  the  related  accounting  operations  also  present  massive 
administrative  burdens. 


ADMINISTRATIVE    REPORTS 


181 


During  the  year  receipts  from  sales  were  $4,464  million  and  accrued 
discount  charged  to  the  interest  account  and  credited  to  the  savings 
bonds  principal  account  amounted  to  $1,286  million,  a  total  of  $5,749 
million.  The  sales  include  $9  million  of  Series  H  bonds  issued  in  ex- 
change for  Series  F  and  J  bonds,  but  exclude  $188  million  of  Series 
E  bonds  exchanged  for  Series  H  bonds.  Expenditures  for  redeeming 
savings  bonds  charged  to  the  Treasurer's  account  during  the  year, 
including  about  $2,673  million  of  matured  bonds,  amounted  to  $5,819 
million.  The  redemptions  include  $147  million  of  Series  F  and  G 
bonds  exchanged  for  marketable  Treasury  bonds  and  $9  million  of 
Series  F  and  J  bonds  exchanged  for  Series  H  bonds,  but  exclude  $188 
million  of  Series  E  bonds  exchanged  for  Series  H  bonds.  The  amount 
of  unmatured  and  matured  savings  bonds  of  all  series  outstanding  on 
June  30,  1961,  including  accrued  discount,  was  $47,754  million,  a 
decrease  of  $69  million  from  the  amount  outstanding  on  June  30, 
1960.  Detailed  information  regarding  savings  bonds  will  be  found  in 
tables  43  to  46,  inclusive,  of  this  report. 

There  were  90.6  million  stubs  representing  issued  bonds  of  Series  E 
received  for  registration  during  fiscal  year  1961,  making  a  grand  total 
of  2,262.8  million,  including  reissues,  received  through  June  30,  1961. 
Original  stubs  of  paper  type  bonds  were  arranged  alphabetically  in 
semiannual  blocks,  by  name  of  owner,  and  microfilmed.  They  were 
then  arranged  by  numerical  sequence  of  their  bond  serial  numbers  in  a 
full  calendar  year  file  and  microfilmed,  after  which  they  were  de- 
stroyed. These  microfilms  are  permanent  registration  records.  The 
original  issue  of  paper  bonds  has  been  discontinued. 

The  issue  stubs  of  the  punch-card  type  bonds  are  microfilmed  in 
batches  as  they  are  received  by  the  Bureau.  The  stubs  are  audited 
and  recorded  by  electronic  processing  equipment  and  then  destroyed. 
Magnetic  tape  files  of  the  bonds  issued,  in  both  alphabetical  and  nu- 
merical sequence,  are  established  and  maintained  with  each  bond  file 
item  indicating  the  location  of  the  microfihn  which  contains  the  com- 
plete image  of  the  original  bond  stub. 

The  following  tables  show  the  status  of  processing  operations  for 
registration  stubs  of  the  paper  type  and  the  card  type  Series  E  savings 
bonds.  The  table  on  card  type  bonds  also  shows  steps  taken  in  re- 
tiring these  bonds. 


Stubs  of  issued  paper  type  Series  E  savings  bonds  in  Chicago  office 
(In  millions  of  pieces) 

Period 

Stubs 
received 

Alphabetically  sorted 

Alpha- 
betically 
filmed 

Numeri- 
cally 
filmed 

Destroyed 

Restricted 
basis 
sort 

Fine  sort 
prior  to 
filming 

after 
filming 

Cumulative  through  June  30, 
1956 

1, 805. 8 

91.1 

37.1 

2.1 

1.9 

1.9 

1,782.6 

88.9 

62.1 

2.5 

1,734.6 

90.4 

85.7 

24.4 

2.3 

1.5 

1,  696. 0 

1C8. 1 

89.9 

41.1 

1.9 

1.9 

1,463.6 

192.3 
178.3 
100.9 

1,457.8 

Fiscal  year: 

1957 

191.3 

1958.    . 

184.1 

1959 - 

101.9 

1960    - 

1961 . 

1.9 

1.9 

Total 

1, 939. 9 

1, 936. 1 

1,  938. 9 

1,  938.  9 

1,937.0 

1, 937. 0 

182 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Re- 
ceived 

Micro- 
filmed 

Key- 
punched 

Con- 
verted 
to  mag- 
netic 
tape 

Au- 
dited 
and 
classi- 
fied 

De- 
stroyed 

Balance 

Fiscal  year 

Un- 
fllmed 

Not 
key- 
punched 

Not 
con- 
verted 
to  mag- 
netic 
tape 

Unau- 
dited 

Stubs  of  issued  card  type  Series  E  savings  bonds  in  Parkersburg  office 
(In  millions  of  pieces) 

1958 

59.5 
87.5 
87.2 
88.7 

57.8 
88.2 
84.7 
90.7 

41.4 
103.4 
82.6 
92.4 

5.7 
119.0 
102.5 
92.2 

34.7 
106.9 
83.6 
92.9 

""58'3" 
154.4 

1.7 
1.0 
3.5 
1.5 

18.1 
2.2 
6.8 
3.1 

53.8 

22.3 

7.0 

3.5 

24.8 

1959.. 

5.4 

1960 

9.0 

1961 

4.8 

Total 

322.9 

321.4 

319.8 

319.4 

318.1 

212.7 

Retired  card  type  Series  E  savings  bonds  recorded  in  Parkersburg  office 
(In  millions  of  pieces) 

1958                   

17.5 
45.2 
55.2 
59.7 

16.7 
45.5 
54.3 
60.6 

10.5 
51.4 
52.5 
61.5 

0.1 
53.2 
60.0 
62.4 

7.3 
52.8 
52.4 
62.8 

""'20."6" 
93.0 

0.8 
.5 

1.4 
.5 

7.0 

.8 
3.5 
1.7 

17.4 
9.4 
4.6 
1.9 

10.2 

1959    

2.6 

1960 

5.4 

1961 

2.3 

Total 

177.6 

177.1 

175.9 

175.7 

175.3 

113.6 

Retired  savings  bonds  of  all  series  received  during  fiscal  year  1961 
numbered  92.3  million.  Retired  bonds  in  card  form  issued  only  in 
Series  E,  are  handled  in  the  Parkersburg  office  where,  after  micro- 
filming, the  bonds  are  audited  and  permanently  recorded  by  an 
electronic  data  processing  system  before  being  destroyed.  The  im- 
mediately preceding  table  shows  the  status  of  these  operations.  Re- 
tired paper  bonds  of  all  series  are  processed  through  the  Cincinnati 
office  where  they  are  audited,  microfilmed,  and  destroyed.  A  list  of 
the  serial  numbers  of  retired  paper  bonds  is  transmitted  to  the  Chicago 
office  for  posting  of  retirement  reference  data  to  numerical  ledgers  for 
permanent  record. 

The  following  tables  show  the  status  of  these  operations  for  the 
paper  type  bonds. 


Retired  paper  type  savings  bonds  of  all  series  in  the  branch  audit  offices  ' 
(In  millions  of  pieces) 

Period 

Bonds 
received 

Audited 

Micro- 
filmed 

Balance 

Destroyed 

Unaudited 

Unfilmed  2 

Cumulative  through  June  30, 
1956 

963.0 

100.2 
81.8 
48.7 
43.2 
32.6 

958.1 

102.1 
81.2 
49.1 
44.4 
32.9 

945.6 

99.8 
82.6 
47.7 
46.2 
34.0 

4.9 

3.0 
3.6 
3.2 
2.0 
1.7 

6.3 

6.7 
5.9 
6.9 
3.9 
2.5 

897.5 

Fiscal  year: 

1957                                

100.0 

1958 

79.3 

1959 

72.4 

1960 

47.5 

1961 

32.2 

Total 

1, 269. 5 

1, 267.  8 

1, 255. 9 

1,228.9 

'  There  is  only  one  audit  othce  now  in  existence  but  prior  to  June  1958  there  were  five  such  offices  and  this 
table  includes  reports  for  all  of  them. 

2  Excludes  9.4  million  pieces  of  unfilmed  spoiled  stock  transferred  to  permanent  storage  and  1.7  million 
pieces  of  unissued  stock  to  be  destroyed  without  microfilming. 


ADMINISTRATIVE    REPORTS 


183 


Retired  paper  type  savings  bonds  of  all  series  recorded  in 
Chicago  office  (in  millions  of  pieces) 

Period 

Number  of 

retired 

bonds 

reported 

Status  of  posting 

Posted 

Verified 

Unposted 

Un- 
verified ' 

Cumulative  through  June  30,  1956 

1,423.8 

100.1 
84.6 
50.3 
45.3 
37.1 

1,419.0 

99.0 
87.2 
50.4 
45.7 
37.2 

1,332.8 

102.3 
64.0 
86.2 
55.5 
39.3 

4.8 

5.9 
3.3 
3.2 
2.8 
2.7 

8.1 

Fiscal  year: 

1957 

4.8 

1958          

28.0 

1959 -- 

3.3 

I960              - 

4.9 

1961 

2.8 

Total      .                                .             -. 

1,741.2 

1, 738. 5 

1,680.0 

•  Represents  balance  unverified  on  current  work.    Excludes  55.7  million  pieces  received  in  1954  and  1955 
which  were  not  verified. 

Of  the  86.6  million  Series  A-E  savings  bonds  redeemed  prior  to 
release  of  registration  and  received  in  the  audit  offices  during  the 
year,  84.6  million,  or  97.7  percent,  were  redeemed  by  over  15,000 
paying  agents.  These  agents  were  reimbursed  for  this  service  in  each 
quarter  year  at  the  rate  of  15  cents  each  for  the  first  1,000  bonds  paid 
and  10  cents  each  for  all  over  the  first  1,000.  The  total  amount  paid 
to  agents  on  this  account  during  the  year  was  $10,819,696,  which  was 
at  the  average  rate  of  12.79  cents  per  bond. 

The  following  table  shows  the  number  of  savings  bonds  outstanding 
as  of  June  30,  1961,  by  series  and  denominations. 


Series 

Total 

Denomination  (in  thousands  of  pieces) 

$10 

$25 

$50 

$100 

$200 

$500 

$1,000 

$5,000 

$10,000 

$100,000 

K  1  

440, 115 

5,319 

3 

5 

14 

79 

411 

1, 240 

473 

590 

963 

236, 621 

94, 177 

76,290 

7,021 

11,956 
1.998 

(') 

(♦) 

1 

5 

39 

233 

48 

159 

13,051 

2,995 

(*) 

(*) 

1 

8 

107 

513 

133 

328 

'"258" 

35 

67 

1 

H  ' 

A       



1 

5 
28 
102 

1 
1 
3 
15 

1 
2 
4 
23 
126 
375 
160 

B 

C 

n    

F    

15 
52 
20 
50 

22 
67 
31 
52 

G 

J 

80 

1 

K 

2 

Total.. 

448,249 

963 

236, 839 

94. 196 

76,981 

7,021 

14,  439 

17, 137 

395 

274 

4 

•Less  than  500  pieces. 

'  Currently  only  bonds  of  Series  E  and  H  are  on  sale. 


184   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


The  following  table  shows  the  number  of  issuing  and  paying  agents 
for  Series  A-E  savings  bonds  by  classes. 


June  30 


Post 
offices  1 


Building 

Companies 

and  sav- 

Credit 

operating 

Banks 

ings  and 
loan  asso- 
ciations 

unions 

payroll 
plans 

All  others 

Total 


Issuing  agents 


1945- 
1950. 
1955. 
1956. 
1957. 
1958. 
1959. 
1960. 
1961- 


24, 038 

15, 232 

3,477 

2,081 

2  9, 605 

(2) 

25,060 

15,225 

1,557 

522 

3,052 

550 

2,476 

15,692 

1,  555 

428 

2,942 

588 

1,768 

15.  845 

1,606 

411 

2,898 

626 

1,401 

15, 978 

1,  665 

379 

2,788 

611 

1.178 

16,047 

1,702 

357 

2,640 

587 

1,120 

16, 178 

1,778 

336 

2,401 

688 

1,093 

16, 436 

1,851 

320 

2,352 

643 

1,061 

13,  505 

1,617 

285 

2,045 

590 

54, 433 
45, 966 
23, 681 
23, 154 
22,  822 
22,511 
22, 501 
22, 695 
1  19, 103 


Paying  agents 


1945. 
1950. 
1955. 
1956. 
1957. 
1958. 
1959. 
1960. 
1961. 


13, 466 

15,  623 

16,  269 
16,  441 
16,613 
16,  744 
16,  860 
17, 127 
13,  670 


874 
1,188 
1,300 
1,438 
1,580 
1,  690 
1,797 
1,605 


137 
139 
138 
172 
171 
168 
169 
158 


13,  460 
16,  691 
17, 652 
17, 933 
18, 282 
18,  554 
18,  778 
19, 153 
I  15,  449 


1  Estimated  by  the  Post  Office  Department  for  1955  and  thereafter.  Sale  of  Series  E  savings  bonds  was 
discontinued  at  post  offices  at  the  close  of  business  on  December  31,  1953,  except  in  those  localities  where 
no  other  public  facilitias  for  their  sale  were  available. 

2  "All  others"  included  with  companies  operating  payroll  plans. 

3  Substantial  reduction  due  to  reanalysis  of  reporting  procedures  by  Federal  Reserve  Banks  effective 
Dec.  31, 1960,  to  reflect  only  the  actual  number  of  entities  currently  qualified. 

Interest  checks  issued  on  current  income  type  savings  bonds  during 
the  year  totaled  5,034,983  with  a  value  of  $258,447,427,  a  decrease 
of  98,710  checks  from  those  issued  during  1960,  and  a  decrease  in 
value  of  $6,063,493.  New  accounts  established  totaled  212,235,  com- 
pared with  190,972  in  1960.  As  of  June  30,  1961,  there  were  1,844,028 
active  accounts  with  owners  of  this  type  savings  bonds,  a  decrease  of 
98,198  accounts  during  the  year.  There  were  reductions  of  182,445 
in  accounts  of  Series  G  bonds  which  have  been  maturing  since  May  1 , 
1953,  and  11,767  in  accounts  of  Series  K  which  were  first  sold  on  May 
1,  1952,  and  discontinued  effective  at  the  close  of  business  April  30, 
1957.  An  increase  of  96,014  occurred  in  accounts  of  Scries  H  bonds, 
which  were  first  sold  on  June  1,  1952. 

Applications  during  the  year  for  the  issue  of  duplicates  of  lost, 
stolen,  or  destroyed  savings  bonds  amounted  to  41,202.  These  to- 
gether with  1,550  cases  on  hand  at  the  beginning  of  the  year,  totaled 
42,752.  In  25,323  cases  the  bonds  were  recovered,  and  in  16,238  cases 
the  issuance  of  duplicate  securities  was  authorized.  On  June  30, 
1961,  1,191  cases  remained  unsettled. 

Other  U.S.  securities. — ^During  the  year  34,581  individual  accounts 
covering  publicly  held  registered  seciu'ities  were  opened  and  30,530 
were  closed.  This  increased  the  total  of  open  accounts  on  June  30, 
1961,  to  248,678  covering  registered  securities  in  the  principal  amount 
of  $14,672  million.  There  were  471,304  interest  checks  with  a  value 
of  $427,413,353  issued  to  owners  of  record  during  the  year,  an  in- 


ADMINISTRATIVE    REPORTS  185 

crease  of  53,596  checks  from  tlie  number  issued  in  1960,  and  a  de- 
crease in  value  of  $28,268,163. 

Redeemed  and  canceled  securities  received  for  audit  included 
4,138,616  bearer  securities  and  186,368  registered  securities,  a  total 
of  4,324,984  as  compared  with  3,996,505  in  1960;  and  20,094,140 
coupons  were  received,  which  was  1,710,778  more  than  in  1960. 

OFFICE  OF  THE  TREASURER  OF  THE  UNITED  STATES 

The  Treasurer  of  the  United  States  is  responsible  for  the  receipt, 
custody,  and  disbursement,  upon  proper  order,  of  the  public  moneys 
and  for  maintaining  records  of  the  source,  location,  and  disposition  of 
these  funds.  The  office  was  created  by  an  act  of  Congress  approved 
September  2,  1789,  as  amended  (31  U.S.C.  141,  147). 

In  lieu  of  branch  or  field  offices,  the  Office  of  the  Treasurer  uses  the 
facilities  of  the  Federal  Reserve  Banks  as  fiscal  agents  of  the  United 
States  to  perform  many  of  its  functions  throughout  the  country. 
These  include  the  verification  and  destruction  of  U.S.  paper  currency; 
the  redemption  of  public  debt  securities ;  the  keeping  of  cash  accounts 
in  the  name  of  the  Treasurer;  the  acceptance  of  deposits  made  by 
Government  officers  for  credit;  and  the  custody  of  bonds  held  to  secure 
public  deposits  in  commercial  banks. 

Commercial  banks  in  the  United  States  and  in  foreign  countries 
which  qualify  as  depositaries  provide  banking  facilities  for  activities 
of  the  Government  at  places  where  they  are  located.  Data  on  the 
transactions  handled  in  the  name  of  the  Treasurer  by  the  Federal 
Reserve  Banks  and  commercial  banks  are  reported  daily  to  the  Treas- 
urer and  are  entered  in  the  Treasurer's  general  accounts. 

Specifically,  the  Treasurer  maintains  current  accounts  of  all  receipts 
and  expenditures;  pays  the  principal  and  interest  on  the  public  debt; 
provides  checking  account  facilities  for  Government  disbursing  officers, 
corporations,  and  agencies ;  pays  checks  drawn  on  the  Treasurer  of  the 
United  States  and  reconciles  the  checking  accounts  of  the  disbursing 
officers;  procures,  stores,  issues,  and  redeems  U.S.  currency;  audits 
redeemed  Federal  Reserve  currency;  examines  and  determines  the 
value  of  mutilated  currency;  acts  as  special  agent  for  the  payment  of 
principal  and  interest  on  certain  obligations  of  corporations  of  the 
United  States  Government  and  certain  obligations  of  Puerto  Rico 
issued  on  or  before  January  1,  1940.  The  Treasurer  also  acts  as 
special  agent  for  the  payment  of  principal  and  interest  on  certain 
pre-1934  dollar  bonds  of  the  Philippine  Islands. 

The  Office  of  the  Treasurer  maintains  facilities  in  the  main  Treasury 
building  for:  Accepting  deposits  of  public  moneys  by  Government 
officers,  the  cashing  of  U.S.  savings  bonds  and  checks  drawn  on  the 
Treasurer,  the  receipt  of  excess  and  unfit  currency  and  coins,  and  the 
conduct  of  transactions  in  both  marketable  and  nonmarketable  public 
debt  securities.  The  Office  also  prepares  the  Daily  Statement  of  the 
United  States  Treasury  and  the  monthly  Circulation  Statement  of 
United  States  Money. 

Acting  under  authority  delegated  by  the  Comptroller  General  of  the 
United  States,  the  Treasurer  processes  claims  arising  from  forgery  of 
endorsements  and  other  irregularities  involving  checks  paid  by  the 


186   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Treasurer  and  passes  upon  claims  for  substitute  checks  to  replace 
unpaid  checks  which  have  been  lost  or  destroyed. 

The  Treasurer  of  the  United  States  is  also  Treasurer  of  the  Board 
of  Trustees  of  the  Postal  Savings  System  and  custodian  of  bonds  held 
to  secure  public  deposits  in  commercial  banks,  bonds  held  to  secure 
postal  savings  on  deposit  in  such  banks,  and  miscellaneous  securities 
and  trust  funds. 

Management  improvement  program 

The  Office  of  the  Treasurer  made  many  changes  throughout  the 
Bureau  during  the  year  which  increased  efficiency  and  produced 
economies.  Some  of  the  improvements  are  having  wide  effect  within 
the  Government  and  others  have  resulted  in  better  service  to  the  gen- 
eral public.  The  more  significant  accomplishments  are  described  in 
the  following  paragraphs. 

New  electronic  equipment  of  an  advanced  design  and  with  faster 
processing  speeds  and  greater  capacity  has  been  installed  in  the  check 
payment  and  reconciliation  activity.  New  computer  programs 
developed  for  this  equipment  have  resulted  in  significant  procedural 
improvements  and  faster  settlement  of  claims  involving  Treasury 
checks.  Annual  savings  resulting  from  the  new  equipment  and 
related  procedural  improvements  are  expected  to  exceed  $100,000. 

Option  agreements  for  the  purchase  of  certain  components  of  the 
electronic  equipment  used  to  pay  and  reconcile  Government  checks, 
were  entered  into  with  the  manufacturer  after  a  thorough  analysis  of 
the  projected  costs  of  purchasing  as  compared  with  renting.  After 
the  capital  investment  has  been  recovered,  purchasing  instead  of 
renting  these  components  will  produce  substantial  economies  by  the 
elimination  of  rental  charges.  The  analysis  also  showed  that  pur- 
chases of  the  other  components  is  not  practical  because  of  the  amount 
of  servicing  and  maintenance  they  normally  require. 

The  office  awarded  a  contract  for  supplying  the  approximately  458 
million  card  checks  which  Government  disbursing  officers  will  purchase 
during  fiscal  1962.  The  new  contract  contains  lower  unit  prices  than 
the  previous  contract  and  will  save  disbursing  offices  about  $70,000 
a  year. 

Under  a  plan  approved  by  the  Treasury  and  Post  Office  Depart- 
ments during  fiscal  1961,  the  electronic  installation  in  the  Treasurer's 
Office  will  be  expanded  as  a  service  to  the  Post  Office  to  include 
reconciliation  of  postal  money  orders.  It  is  contemplated  that 
several  phases  of  the  plan  will  be  put  into  effect  beginning  late  in 
fiscal  1962.  Full  operation  is  expected  to  save  the  Government  over 
$650,000  a  year  and  to  effect  substantial  improvements  in  the  control 
and  servicing  of  money  orders. 

The  Bureau's  incentive  awards  program  has  been  given  added 
impetus  by  the  reorganization  of  its  incentive  awards  committee  to 
consist  of  division  chiefs  who  will  review  all  recommendations  for 
suggestion  and  performance  awards. 


ADMINISTRATIVE    REPORTS 


187 


Eight  percent  of  the  office  force,  selected  from  all  organizational 
levels,  participated  in  training  programs  during  the  year.  The 
courses  were  aimed  at  improving  skills  and  techniques  and  providing 
training  in  such  areas  as  personnel  management,  automatic  data  proc- 
essing, and  executive  development.  Special  attention  was  given  to 
the  need  for  having  trained  employees  available  in  areas  where  there 
are  apt  to  be  many  retirements  within  the  next  few  years. 

A  significant  step  was  taken  in  the  records  maintenance  program 
when  over  one  million  records  of  active  stop  payments  against  Govern- 
ment checks,  received  prior  to  the  installation  of  the  electronic  system 
for  paying  checks,  were  converted  to  microfilm.  The  records,  which 
must  be  retained  permanently,  were  becoming  illegible,  torn,  and 
difficult  to  handle. 

Assets  and  liabilities  in  the  Treasurer's  account 

The  assets  of  the  Treasurer  consist  of  gold  and  silver  ballion,  coin 
and  paper  currency,  deposits  in  Federal  Reserve  Banks,  and  deposits 
in  commercial  banks  designated  as  Gov^ernment  depositaries. 

A  smnmary  of  the  assets  and  liabilities  in  the  Treasurer's  account 
at  the  close  of  the  fiscal  years  1960  and  1961  is  shown  in  table  56. 

Gold. — The  gold  assets,  which  amounted  to  $19,321.9  million  on 
June  30,  1960,  on  the  daily  Treasury  statement  basis,  declined  rapidly 
for  several  months  thereafter.  The  outflow  leveled  off  in  February 
1961  and,  from  a  low  of  $17,372.2  million  in  mid-March,  the  assets 
had  increased  to  $17,550.1  million  as  the  fiscal  year  ended.  Receipts 
were  $539.9  million  and  disbursements  $2,311.7  million  for  the  year. 
The  final  balance  of  $17,550.1  million  on  June  30,  1961,  covered 
habilities  of  $17,285.5  million  in  gold  certificates  or  credits  payable 
in  gold  certificates  and  $156.0  million  for  the  gold  reserve  against 
currency,  leaving  a  free  gold  balance  of  $108.5  million. 

Silver. — Transactions  in  silver  bullion  during  the  year  are  sum- 
marized, in  millions  of  dollars,  in  the  following  table. 


Fiscal  year  1961 


Silver  bullion  held  at 


Monetary 
value 


Cost  value 


Recoinage 
value 


On  hand  July  1,  1960 

Received  (+)  or  disbursed  (— ),  net. 

Revalued 

Used  in  coinage 


$2, 252. 1 


+.3 


On  hand  June  30,  1961. 


2, 252.  3 


$114.9 

-28.5 

-.2 

-29.1 


57.1 


$0.3 
+1.5 


The  closing  balance  of  $2,252.3  million  in  silver  bullion  at  the 
monetary  value  of  $1.29+  per  ounce,  was  held,  together  with  $150.2 
million  m  silver  dollars,  to  secure  outstanding  silver  certificates  of 
$2,373.9  miUion  and  outstanding  Treasury  notes  of  1890  of  $1.1  mil- 
lion on  June  30,  1961.  This  left  a  free  balance  of  $27.5  million  in  mon- 
etized silver. 


614359—62- 


-13 


188   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Balances  with  depositaries. — -The  following  table  shows  the  n amber 
of  each  class  of  depositaries  and  balances  on  June  30,  1961. 


Class 


Number  of 
accounts  with 
depositaries ' 


Deposits  to  the 
credit  of  the 
Treasurer  of 
the  United 

States 
June  30,  1961 


Federal  Reserve  Banks  and  branches 

Other  domestic  depositaries  reporting  directly  to  the  Treasurer.. 
Domestic  depositaries  reporting  through  Federal  Reserve  Banks: 

General  depositaries.. 

Special  depositaries,  Treasury  tax  and  loan  accounts 

Foreign  depositaries' 

Total 


36 
42 

1,732 

11,340 

73 


2  $629, 999, 352 
41, 756, 399 

270, 855, 779 

5,452,671,002 

22, 340, 204 


13, 223 


6,417,622,736 


1  Includes  only  depositaries  having  balances  with  the  Treasurer  of  the  United  States  on  June  30,  1961. 
Excludes  depositaries  duly  designated  for  this  purpose  but  having  no  balances  on  that  date  and  those 
designated  to  furnish  official  checking  account  facihties  or  other  services  to  Government  officers  but  which 
are  not  authorized  to  maintain  accounts  with  the  Treasurer.  Banking  institutions  designated  as  general 
depositaries  are  frequently  also  designated  as  special  depositaries,  hence  the  total  number  of  accounts 
exceeds  the  number  of  institutions  involved. 

2  Includes  checks  for  $222,173,189  in  process  of  collection. 

s  Principally  branches  of  U.S.  banks  and  of  the  American  Express  Company,  Inc. 

Bureau  operations 

Receiving  and  disbursing  public  moneys. — Moneys  collected  by 
Government  officers  are  deposited  with  the  Ti-easiirer  at  Washington, 
in  Federal  Reserve  Banks,  and  in  designated  Government  depositaries 
for  credit  to  the  account  of  the  Ti-easurer  of  the  United  States,  and 
all  payments  are  withdrawn  from  this  account.  Moneys  deposited 
and  withdrawn  in  the  fiscal  years  1960  and  1961,  exclusive  of  certain 
intragovernmental  transactions,  are  shown  in  the  following  table  on 
the  basis  of  the  Daily  Statement  oj  the  United  States  Treasury. 


Deposits,  withdrawals,  and  balances  in  the  Treasurer's  account 


Cash  deposits   (net)   (including  internal  revenue,  customs,  trust 
funds,  etc.) 

Public  debt  receipts  i — 

Less  accrued  discount  on  U.S.  savings  bonds  and  Treasury  bills... 

Total  net  deposits --- - • 

Balance  at  begtoning  of  fiscal  year --- ■ 

Total - — ■ 

Cash  withdrawals  (includes  budget  and  trust  accounts,  etc.). 

Net  transactions  in: 

Investments  of  Government  agencies  in  public  debt  securities, 

excess  of  investments,  or  redemptions  (— ). — 

Sales  and  redemptions  of  obligations  of  Government  agencies  in 

market,  excess  of  redemptions,  or  sales  (—)... 

Public  debt  redemptions  ' --- • 

Less  redemptions  included  in  cash  withdrawals 

Total  net  withdrawals 

Balance  at  close  of  fiscal  year 


1960 


$94, 861, 698, 466 
187,551,096,432 
-2,844,933,117 


279,  567, 861,  781 
5, 350, 391,  763 


284, 918, 253,  544 


93,  508, 321,  596 


992, 195, 940 

-1, 265,  658,  759 
185, 926, 242,  662 
-2, 247,  588, 893 


276, 913,  512,  546 
8, 004, 740, 998 


'  For  details  for  1961  see  table  35. 


1961 


$96, 897, 026,  794 
176, 247,  926, 563 
-2, 309,  768,  703 


270, 835, 184, 654 
8, 004,  740, 998 


278, 839, 925,  652 


8, 283, 877, 037 


921,036,604 

1,107,286,500 
173,607,748,801 
-1,774,143,244 


272, 145, 805, 698 
6,694,119,954 


Old  series  currency.— The  Old  Series  Currency  Adjustment  Act, 
approved  June  30,  1961  (see  exhibit  10,  p.  297),  authorizes  and  du-ects 
the  Secretary  of  the  Treasm-y  to  make  certain  adjustments  and  to 


ADMINISTRATIVE    REPORTS 


189 


take  certain  other  actions  with  respect  to  all  large  size  currency 
outstanding  which  was  issued  prior  to  July  1,  1929,  and  with  respect 
to  small  size  gold  certificates  outstanding  which  were  issued  between 
July  1,  1929,  and  January  30,  1934,  the  date  of  enactment  of  the 
Gold  Reserve  Act  of  1934  (31  U.S.C.  440-446).  Any  such  old  series 
cm-rency  presented  to  the  Treasury  will  be  redeemed  from  the  general 
fund  of  the  Treasury  and  the  amount  of  the  public  debt  outstanding 
will  be  correspondingly  reduced. 

In  accordance  with  the  provisions  of  the  new  act,  gold  and  silver 
reserves  in  the  aggregate  amount  of  $61,059,919  were  released  as  of 
July  1,  1961.  These  reserves  had  been  held  as  security  for  gold 
certificates  issued  prior  to  January  30,  1934,  and  as  security  for  or 
for  the  redemption  of  Treasury  notes  of  1890  and  of  silver  certificates 
issued  prior  to  July  1,  1929.  The  freeing  of  these  reserves  resulted 
in  an  equivalent  increase  in  the  free  gold  balance  and  the  free  silver 
balance  in  the  general  fund  available  for  the  issuance  of  gold  certifi- 
cates to  Federal  Reserve  Banks  and  for  the  issuance  of  additional 
amounts  of  silver  certificates. 

The  amount  of  each  of  these  old  series  currency  issues  outstanding 
on  July  1,  1961,  was  credited  as  a  public  debt  receipt  and  established 
as  a  public  debt  liability  bearing  no  interest  as  follows: 

Gold  certificates $29,959,809 

Silver  certificates 29,  958,  443 

Treasury  notes  of  1890 1,  141,  667 

Also,  as  provided  by  section  4  of  the  new  act,  each  Federal  Reserve 
Bank  paid  into  the  Ti^easury  an  amount  equal  to  its  Federal  Reserve 
notes  of  any  series  prior  to  the  series  of  1928  outstanding  as  of  July  1, 
1961.  These  payments  were  made  on  July  28,  1961,  in  the  aggregate 
amount  of  $36,419,050.  This  amount  was  credited  to  public  debt 
receipts  and  established  as  a  public  debt  liability  bearing  no  interest 
(section  6(b)  of  the  act).  The  amount  received  from  each  Federal 
Reserve  Bank  was  as  follows : 


Federal  Reserve  Bank 


Boston 

New  York . . 
Philadelphia 
Cleveland--. 
Richmond.. 

Atlanta 

Chicago 


Amount 


$2,397,025 
9, 259, 995 
2, 704, 685 
3,  756, 435 
1,547,845 
2,054,150 
5, 637, 450 


Federal  Reserve  Bank 


St.  Louis 

Minneapolis-. 
Kansas  City. . 

Dallas 

San  Francisco. 

Total--. 


Amount 


$1,385,645 

1,307,395 

1,561,510 

972, 515 

3, 834, 400 


36,419,050 


In  accordance  with  section  6(c)  of  the  act,  the  Secretary  of  the 
Treasury,  from  time  to  time,  will  determine  the  amount  of  each 
denomination  of  each  kind  of  old  series  currency  outstanding  which 
in  his  judgment  has  been  destroyed  or  irretrievably  lost  and  so  will 
never  be  presented  for  redemption.  The  public  debt  liability  for 
these  currencies  will  be  reduced  by  the  amount  of  the  determinations 
with  corresponding  credit  to  miscellaneous  receipts  of  the  Treasury. 

The  act  also  authorizes  the  establishment  of  a  historical  collection 
of  the  paper  currency  issues  of  the  United  States. 


190    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Issuing  and  redeeming  paper  currency. — By  law  the  Treasurer  is  the 
agent  for  the  issue  and  redemption  of  U.S.  paper  currency.  The 
Treasurer's  Office  procures  all  U.S.  paper  currency  from  the  Bureau  of 
Engraving  and  Printing  and  places  it  in  circulation  as  needed,  chiefly 
through  the  facilities  of  the  Federal  Reserve  Banks  and  their  branches. 

The  Federal  Reserve  Banks  and  branches  as  agents  of  the  Treasury 
redeem  and  destroy  the  major  portion  of  the  U.S.  currency  as  it  be- 
comes unfit  for  circulation.  A  small  amount  is  handled  directly  by 
the  Treasurer's  Office. 

Federal  Reserve  notes  are  issued  by  Federal  Reserve  Banks.  The 
Federal  Reserve  Banks  also  redeem  these  notes,  cut  them  in  half  and 
forward  the  halves  separately  to  Washington  where  the  Currency 
Redemption  Division  of  the  Treasurer's  Office  verifies  the  lower  halves 
and  the  Office  of  the  Comptroller  of  the  Currency  verifies  the  upper 
halves.  Both  halves  are  then  destroyed  under  the  direction  of  a 
special  committee. 

The  Currency  Redemption  Division  also  redeems  unfit  paper  cur- 
rency of  all  types  received  from  local  sources  in  Washington  and  from 
Government  officers  abroad;  and  examines  and  identifies  for  lawful 
redemption  all  burned  and  mutilated  currency  received  from  any 
source.  The  last  operation  requires  special  techniques  and  unlimited 
patience  on  the  part  of  skilled  examiners  as  the  currency  received 
may  be  charred,  discolored,  moldy,  in  fragments,  or  in  claylike 
chunks.  During  fiscal  1961  such  currency  was  examined  for  45,588 
claimants  and  payment  made  therefor  to  the  extent  of  $6,918,446. 

A  comparison  of  the  amounts  of  paper  currency  of  all  classes,  in- 
cluding Federal  Reserve  notes,  issued,  redeemed,  and  outstanding 
diu-mg  the  fiscal  years  1960  and  1961  follows. 


I960 

1961 

Pieces 

Amount 

Pieces 

Amount 

Outstanding  July  1         - 

3, 553, 469, 038 
1,651,081,648 
1,636,425,384 
3, 568, 125, 302 

$34,076,030,538 

7,  714,  526, 885 

7,  627,  754, 630 

34, 162, 802,  793 

3, 568, 125, 302 
1.687,618,740 
1,623,060,302 
3, 632, 683, 740 

$34,162,802,793 

8,  224, 217, 983 

7,  698, 190, 987 

34, 688,  829,  789 

Table  63  shows  by  class  and  denomination  the  value  of  paper  cur- 
rency issued  and  redeemed  during  the  fiscal  year  1961  and  the  amounts 
outstanding  at  the  end  of  the  year.  Tables  58  through  61  give  further 
details  on  the  stock  and  circulation  of  money  in  the  United  States. 
These  tables,  however,  do  not  reflect  the  adjustments  made  pursuant 
to  the  Old  Series  Currenc3^  Adjustment  Act  described  above.  The 
act  was  approved  on  June  30,  1961,  the  last  day  of  the  fiscal  year  and 
adjustments  were  therefore  not  made  until  fiscal  1962. 

Checking  accounts  of  disbursing  officers  and  agencies. — As  of  June  30, 
1961,  the  Treasurer  maintained  2,290  checking  accounts  as  compared 


ADMINISTRATIVE    REPORTS 


191 


with  2,272  on  June  30,  1960.     The  number  of  checks  paid,  by  cate- 
gories of  disbursing  officers,  during  fiscal  1960  and  1961  follows. 


Disbursing  officers 

Number  of  checks  paid 

1960 

1961 

283,496,174 
26, 939, 886 
33, 588, 322 
31, 594, 858 
31, 292, 002 

301,031,795 

27  943  028 

Navy. 

35, 388, 109 

32, 163, 458 

other       - 

33, 655, 044 

Total 

406, 911, 242 

430,181,434 

Settling  check  claims. — During  the  fiscal  year  the  Treasurer  processed 
330,000  requests  to  stop  payment  on  Government  checks,  including 
approximately  66,000  requests  for  information  and  for  photostatic 
copies  of  paid  checks.  In  addition,  61,000  requests  for  removal  of 
stop  payments  were  processed. 

The  Treasurer  acted  upon  194,000  paid  check  claims  during  the 
year,  including  those  referred  to  the  U.S.  Secret  Service  for  investiga- 
tion which  involved  the  forgery,  alteration,  counterfeiting,  or  fraudu- 
lent issuance  and  negotiation  of  Government  checks.  Reclamation 
was  requested  from  those  having  liability  to  the  United  States  on 
29,000  claims,  and  $2,771,000  was  recovered.  Settlements  and 
adjustments  were  made  on  27,000  forgery  cases  totaling  $3,044,000. 
Disbursements  from  the  check  forgery  insurance  fund,  established 
to  enable  the  Treasurer  to  expedite  settlement  of  check  claims, 
totaled  $228,000.  As  recoveries  are  made,  these  moneys  are  restored 
to  the  fund.  Settlements  totaling  $2,737,000  have  been  made  from 
this  $50,000  revolving  fund  established  by  the  act  of  November  21, 
1941  (31  U.S.C.  561-564). 

Claims  involving  81,000  outstanding  checks  were  acted  upon.  Of 
this  number,  70,000  were  certified  for  issuance  of  substitute  checks 
valued  at  $22,341,000  to  replace  checks  that  were  not  received  or 
were  lost,  stolen,  or  destroyed. 

Collecting  checks  deposited. — Government  officers  deposited  more 
than  6,700,000  commercial  checks,  drafts,  money  orders,  etc.,  during 
the  year  with  the  Cash  Division  in  Washington  for  collection. 

Sale  of  uncirculated  coin  sets.- — The  Cash  Division  packaged  and 
sold  to  collectors  50,000  sets  of  uncirculated  coins  minted  in  1959  and 
223,000  sets  minted  in  1960.  This  service  is  rendered  at  no  expense 
to  the  Government  as,  in  addition  to  the  face  value  of  the  coins,  a 
fee  of  58  cents  a  set  is  charged  for  the  cost  of  assembling,  handling, 
and  mailing  the  coins. 


192 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Custody  of  securities. — The  face  value  of  securities  held  in  the 
custody  of  the  Treasui'er  as  of  June  30,  1960  and  1961,  is  shown  in 
the  following  table. 


Purpose  for  which  held 


June  30 


1960 


As  collateral: 

To  secure  deposits  of  public  moneys  in  depositary  banks. 

To  secure  postal  savings  funds 

In  heu  of  sureties.. 

In  custody: 

For  the  Secretary  of  the  Treasury  i 

For  Board  of  Trustees,  Postal  Savings  System 

For  the  Comptroller  of  the  Currency 

For  the  Federal  Deposit  Insurance  Corporation 

For  the  Rural  Electrification  Administration 

For  the  District  of  Columbia 

For  the  Commissioner  of  Indian  Affairs   

Foreign  obhgations  2 

Other  3 

For  servicing  outstanding  Government  issues: 

Unissued  bearer  securities 


$186, 

21, 

4, 

30,  227, 

469, 

11, 

1,  389, 

95, 

41, 

40, 

12, 072, 

87, 


388, 600 
057, 500 
240, 000 

514, 068 
137, 000 
723, 000 
300, 000 
758,411 
918,  842 
540,  895 
095, 132 
453,  776 


1, 225,  703, 200 


$134, 161,  600 
17, 848,  500 
4, 038, 900 

31,260,583,684 

344, 137, 000 

12, 157,  000 

1, 385,  297,  830 

97, 984, 184 

51,501,866 

38,  358,  725 

12, 068,  244, 132 

67,  710,  576 

1,968,817,900 


Total... 45,872,830,424 


47,450,841,897 


'  Includes  those  securities  listed  in  table  121  as  in  custody  of  the  Treasury. 

2  Issued  by  foreign  governments  to  the  United  States  for  indebtedness  arising  from  World  War  I. 

5  Includes  U.S.  savings  bonds  in  safel^eeping  for  individuals. 

Servicing  securities  for  Federal  agencies  and  jor  certain  other  govern- 
ments.— In  accordance  with  agreements  between  the  Secretary  of  the 
Treasury  and  various  Government  corporations  and  agencies  and 
Puerto  Rico,  the  Treasurer  of  the  United  States  acts  as  special  agent 
for  the  payment  of  principal  of  and  interest  on  their  securities.  The 
amounts  of  these  payments  during  the  fiscal  year  1961,  on  the  basis 
of  the  daily  Treasury  statement,  were  as  follows: 


Payments  made  for 

Principal 

Interest 
paid  with 
principal 

Registered 
interest ' 

Coupon 
interest 

$1,414,675,000 

604, 617, 300 

19.300 

91,678,650 

1, 593,  224, 000 

$40, 195,  505 

12,  203, 721 

24 

857,  807 

9, 320, 218 

$7, 893, 161 

Federal  land  banks 

$7,431,721 

75, 282, 319 

1,077 

6, 604, 647 

101, 468, 857 

814, 695 

8,600 

28, 000 

1,152,000 

7,026 

Philippine  Islands 

8,685 

Puerto  Rico 

5,720 

25,  625 

87, 660 

Total 

3,  705, 402,  850 

62,  582, 995 

14,  061,  993 

185,  563, 480 

1  On  the  basis  of  checks  issued. 


ADMINISTRATIVE    REPORTS  193 

Internal  Revenue  Service  ^ 

The  Internal  Revenue  Service  is  responsible  for  collecting  internal 
revenue  and  for  administering  the  internal  revenue  laws.  One  of  the 
primary  objectives  of  the  Service  is  to  preserve  and  strengthen  the 
self-assessment  system  of  taxation.  The  Service  is  responsible  also 
for  administering  certain  other  statutes  includmg  the  Federal  Alcohol 
Administration  Act  (27  U.S.C.  201-212),  the  Liquor  Enforcement  Act 
of  1936  (18  U.S.C.  1261,  1262,  3615),  and  the  Federal  Firearms  Act 
(15  U.S.C.  901-909). 

Internal  revenue  collections  and  refunds 

Collections. — Internal  revenue  collections  in  fiscal  1961  reached  a 
record  $94.4  billion.  This  was  an  increase  of  $2.6  billion,  or  3  percent 
more  than  that  collected  in  fiscal  1960.  It  is  significant  that  approxi- 
mately 97  percent  of  the  total  is  paid  voluntarily  by  taxpayers  under 
our  self-assessment  system.  An  increase  of  $1.2  billion  in  individual 
income  taxes  from  those  in  fiscal  1960  represented  almost  one-half  the 
increase  in  total  mternal  revenue  and  reflected  the  rise  m  the  national 
level  of  personal  income  in  calendar  1960.  The  $0.4  billion  decrease 
in  corporation  income  taxes  resulted  from  the  decline  in  corporate 
profits  in  that  year. 

Old-age  and  disability  insurance  taxes  provided  more  than  half  of 
the  additional  revenue  collected  in  fiscal  1961.  The  increase  of  $1.4 
billion  reflected  not  only  the  higher  level  of  personal  income  but  also 
the  rise  in  the  tax  rate  (from  2.5  percent  to  3.0  percent  each  on  em- 
ployers and  employees)  which  was  in  effect  for  all  of  fiscal  1961  but 
only  part  of  fiscal  1960. 

Excise  taxes  increased  about  $0.2  billion  in  fiscal  1961.  Changes  in 
the  tax  structure  which  affected  excise  tax  collections  included:  The 
increase  from  3  to  4  cents  per  gallon  on  gasoline  and  diesel  fuel  effective 
all  of  fiscal  1961  but  only  part  of  1960;  the  decrease  from  20  percent  to 
10  percent  in  the  tax  rate  for  cabarets  and  roof  gardens  which  became 
effective  toward  the  close  of  fiscal  1960;  and  the  broadening  of  the  tax 
base  for  air  conditioners  by  an  administrative  ruling  effective 
December  1,  1959. 

Refunds. — Refunds  of  internal  revenue,  comprising  both  principal 
and  interest,  aggregated  $6.0  billion  in  fiscal  1961  compared  with 
$5.3  billion  in  1960.  Gross  collections,  less  refunds,  were  $88.4  billion 
in  fiscal  1961  and  $86.5  billion  in  1960.  These  amounts  wfll  differ 
from  net  budget  receipts  which  exclude  refunds  and  amounts  trans- 
ferred to  trust  funds,  and  include  collections  from  customs  and 
miscellaneous  sources. 

A  comparison  of  collections  in  the  fiscal  years  1960  and  1961  by 
principal  types  of  tax  is  shown  below.  Collections  from  1929  through 
1961  in  more  detailed  categories  are  given  in  table  17. 


'  Additional  information  will  be  found  in  the  separate  Annual  Report  of  the  Commissioner  of  Internal 
Revenue. 


194        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


Source 


1960 


In  thousands  of  dollars 


Income  taxes: 

Corporation 

Individual: 

Withheld  by  employers-.- 

Other 

Total  individual  income  taxes 

Total  income  taxes 

Employment  taxes: 

Old-age  and  disability  insurance 

Unemployment  insurance 

Railroad  retirement 

Total  employment  taxes 

Estate  and  gift  taxes 

Excise  taxes: 

Alcohol  taxes 

Tobacco  taxes 

Other  excise  taxes 

Total  excise  taxes 

Total  collections 


22, 179, 414 

31, 674, 588 
13,271,124 


44,945,711 
67, 125, 126 

10, 210, 550 
341,108 
606. 931 


11, 158, 589 
1, 626, 348 

3, 193, 714 
1, 931, 504 
6,  739,  522 


11, 864, 741 
91, 774, 803 


21, 764, 940 

32, 977, 654 
13, 175, 346 


46,153,001 
67, 917, 941 

11,586,283 
345, 356 
570, 812 


12, 502, 451 
1, 916, 392 

3, 212, 801 
1,991,117 
6, 860, 384 


12, 064, 302 
94, 401, 086 


Interpretation  and  communication  of  tax  law  to  taxpayers 

To  assist  taxpayers  in  obtaining  an  understanding  of  their  rights 
and  responsibihties,  the  Service  prepares  and  distributes  basic  regu- 
lations, rulings,  tax  forms,  and  instructions.  It  also  publishes  a 
series  of  tax  guides  (including  a  school  kit)  and  disseminates  mforma- 
tion  through  the  various  news  media.  District  and  local  offices 
work  closely  with  taxpayers  by  giving  individual,  group,  or  telephone 
assistance  to  those  in  need  of  information  to  prepare  their  tax  returns 
correctly,  comply  with  filing  requirements,  or  meet  payment 
deadlmes. 

Taxpayer  publications.- — Under  the  Service's  taxpayer  publications 
program  taxpayers  are  informed  of  the  requirements  of  the  Federal 
tax  laws  and  their  rights  thereunder,  and  are  provided  with  clear, 
understandable,  and  detailed  answers  to  specific  problems  in  order 
to  enable  them  to  compute  their  taxes  properly  with  a  minimum  of 
time  and  effort.  Several  of  the  most  widely  used  taxpayer  publica- 
tions are  the  detailed  tax  guides  prepared  for  different  classes  of 
taxpayers,  such  as  small  busmesses,  farmers,  and  aliens.  Others  are 
published  covermg  the  tax  effect  of  special  problems  common  to  broad 
segments  of  the  population. 

Public  information  program. — The  Service  conducts  an  active 
public  mformation  program,  by  the  use  of  films  and  spot  announce- 
ments on  radio  and  television,  to  provide  current  data  on  revenue 
operations  and  to  improve  taxpayer  understanding  of  Federal  tax 
laws.  In  addition,  in  1961,  more  than  150  technical  and  general 
news  releases  were  issued,  ranging  from  reports  on  the  Service's 
nationwide  gambling  raids  to  developments  on  the  conversion  to 
automatic  data  processing. 

Taxpayer  assistance. — The  aim  of  the  1961  program  was  to  provide 
professional  service  to  all  taxpayers  who  needed  assistance.  During 
the  1961  filing  period,  10.4  million  taxpayers  were  assisted  compared 
with  10.2  milhon  for  the  same  period  in  1960.  Three  types  of  as- 
sistance are  furnished  taxpayers:  Individual  or  group  assistance; 
self-help  (an  employee  helping  two  to  eight  taxpayers  at  a  time  by 
going  from  one  to  another  resolving  problems  as  each  fills  out  his 


ADMINISTRATIVE    REPORTS  195 

own  return) ;  and  replies  to  inquiries  by  telephone.  In  recent  years 
increasing  emphasis  has  been  placed  on  the  use  of  the  telephone 
assistance.  In  1961  about  56  percent  of  all  requests  were  telephoned 
compared  with  53  percent  in  1960. 

Tax  return  forms  program. — In  keeping  with  its  continuous  effort 
to  simplify  and  improve  tax  return  forms,  the  Service  made  a  study 
of  suggestions  for  revising  tax  forms  received  from  Service  employees, 
practitioners,  and  taxpayers.  Several  changes  in  the  tax  forms  were 
made,  some  of  which  were  attributable  to  these  suggestions  and  also 
to  the  anticipated  requirements  for  conversion  to  automatic  data 
processing.  In  addition,  several  new  tax  forms  were  issued  to  improve 
Service  procedures. 

Regulations  program. — Regulations  completed  durmg  the  year 
included  a  major  one  relatmg  to  miscellaneous  stamp  taxes  and 
temporary  regulations  relating  to  the  Dealers  Reserve  Adjustment 
Act  of  1960  (26  U.S.C.  481  note).  All  regulations  issued  under  the 
Federal  Alcohol  Administration  Act  (27  DFR,  Parts  1-8)  were  re- 
published in  the  Federal  Register  on  December  29,  1960.  These 
regulations  mcorporate  all  amendments  published  by  Treasury 
Decisions  prior  to  September  1,  1960,  and  reflect  certam  changes 
made  m  chapter  51  of  the  Internal  Revenue  Code  of  1954  by  section 
201  of  the  Excise  Technical  Changes  Act  of  1958  (26  U.S.C.  5001- 
5692). 

Receipt  and  processing  of  returns 

Number  of  returns  filed. — In  the  1961  fiscal  year,  95.8  million  tax 
returns  of  all  classes  were  received  by  the  Internal  Revenue  Service, 
which  was  1.4  million  (1.5  percent)  more  than  in  1960.  Over  half 
of  the  mcrease  occurred  among  mdividual  income  tax  returns  with 
the  combmed  total  of  Forms  1040,  1040W,  and  1040 A  mcreasing 
0.8  million  (1.3  percent)  over  those  hi  the  year  before.  Information 
returns  received  in  1961  totaled  over  330  million. 

Processing  of  returns. —The  three  service  centers  processed  almost 
60.0  million  individual  mcome  tax  returns,  about  12.7  million,  or  27 
percent  more  than  m  1960.  In  addition,  4.7  million  mdividual 
estimated  tax  declarations  were  processed.  Accounts  receivable 
were  established  for  appropriate  individual  income  and  estimated 
tax  returns.  This  was  the  first  year  for  which  service  centers  per- 
formed mailing  and  delmquency  check  operations  on  employers' 
returns.  Form  941,  for  all  quarters  and  all  districts. 

In  accordance  with  administration  policy,  the  Service  expedited 
its  refundmg  program  to  such  an  extent  that  the  number  scheduled 
through  March  1961  was  21  percent  above  the  same  period  in  1960. 
In  the  sLx-month  period  ended  June  30,  1961,  nearly  36.0  million 
refunds  were  scheduled  on  individual  income  tax  returns  filed  for 
the  1960  tax  year.  This  was  an  mcrease  of  1.4  million  (4  percent) 
over  the  same  period  last  year.  The  average  refund  scheduled  for 
the  tax  year  1960  was  $124  compared  with  $114  for  the  tax  year  1959. 

During  the  period  January- June  1961  the  northeast  service  center 
processed  individual  income  tax  returns  for  the  tax  year  1960  on  new 
high-speed  magnetic  tape  computers.  This  advanced  electronic  sys- 
tem made  possible  the  submission  of  the  refund  data  to  the  Chicago 
regional  disbursing  office  on  magnetic  tape.     Beginning  January  1, 


196   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

1962,  the  Service  plans  to  utilize  this  equipment  in  the  midwest  and 
western  service  centers. 

Automatic  data  processing. — Substantial  progress  was  made  in  the 
Service's  program  to  develop  automatic  data  processing  during  fiscal 
1961.  This  program,  which  will  be  installed  over  a  period  of  several 
years,  is  designed  to  bring  major  advances  to  the  processing  and  en- 
forcement acti\nties  of  the  Internal  Revenue  Service  through  a  net- 
work of  high-speed  electronic  computers.  Some  significant  highlights 
of  the  past  year  were:  Creation  of  the  new  ADP  Division;  selection 
and  training  of  systems  analysts  and  programmers;  systems  design  for 
processing  business  returns;  planning  for  personnel  redeployment; 
establishment  of  the  pilot  service  center  in  Atlanta,  Ga. ;  and  initiat- 
ing the  construction  of  the  national  computer  center  at  Martinsburg, 
W.Va. 

The  new  system  will  be  tested  in  the  pilot  service  center  established 
in  Atlanta.  The  center  will  service  district  offices  in  the  States  of 
Alabama,  Georgia,  Florida,  Mississippi,  North  Carolina,  South  Caro- 
lina, and  Tennessee.  It  was  staffed  \vith  key  administrative  person- 
nel and  began  the  buildup  of  its  work  force  to  process  returns.  Starting 
January  1962  business-type  returns  will  be  processed,  and  in  January 
1963  this  service  center  will  begin  processing  individual  income  tax 
returns. 
Enforcement  activities 

The  enforcement  activities  of  the  Service  play  an  important  role  in 
sustaining  public  confidence  in  our  self-assessment  tax  system  and  in 
encouraging  voluntary  compliance.  These  activities  include  correct- 
ing errors  on  returns  voluntarily  filed ;  identifying  and  collecting  taxes, 
interest,  and  penalties  from  taxpayers;  and,  where  warranted,  prose- 
cuting those  who  deliberately  falsify  or  seek  to  evade  their  just  tax 
responsibilities. 

Examination  of  returns. — District  audit  divisions  examined  3.5 
million  returns  during  fiscal  1961  compared  with  3.0  million  in  1960. 
This  sharp  increase  in  examinations  is  attributed  primarily  to  the  use 
of  improved  office  audit  techniques.  A  comparison  of  the  number  of 
returns  examined  during  the  last  two  years  follows. 


Type  of  return 


Fiscal  year 
1961 


Income  tax: 

Corporation 165  163 

Individual  and  fiduciary- 2,571  3,079 

Total  income  tax 2,736  3,242 

Estate  and  gift  taxes _. -.-  27  32 

Excise  and  employment  taxes  i.._ 236  212 

Grand  total - 3,000  3,486 

1  Excludes  examinations  resulting  in  no  tax  change  where  such  examination  was  made  from  the  taxpayer's 
copies  of  returns  in  the  course  of  an  audit  covering  both  income  and  excise  and/or  employment  taxes. 

Additional  tax,  penalties,  and  interest  assessed  on  examined  returns 
amounted  to  nearly  $1.8  billion  in  1961,  an  increase  of  $972,000  over 
that  in  1960.  A  decrease  of  $85.3  million  in  additional  assessments  of 
corporation  income  taxes  was  more  than  oft'set  by  increases  of  $81.5 


ADMINISTRATIVE    REPORTS  197 

million  on  individual  and  fiduciary  income  taxes,  $2.5  million  on  estate 
and  gift  taxes,  and  $2.4  million  on  employment  taxes.  The  amount  saved 
through  the  examination  and  disallowance  of  improper  refund  claims 
increased  from  $635  million  in  1960  to  $649  million  in  1961.  Not  all 
examinations  resulted  in  an  increase  in  tax,  however.  For  instance, 
recommendations  of  $116.0  million  in  overassessments  were  made  in 
1961,  an  amount  only  slightly  less  than  the  $116.5  million  recommended 
in  1960. 

Mathematical  verification. — Tax  computations  on  more  than  59.5 
million  individual  income  tax  returns  were  mathematically  verified 
during  the  year,  an  increase  of  9.3  million,  or  19  percent  over  those  in 
1960.  The  number  of  error  cases  increased  from  2.0  million  in  1960  to 
2.5  million  in  1961.  The  verification  process  yielded  tax  increases 
aggregating  $132  million,  compared  with  $112  million  in  1960,  while 
tax  decreases  totaled  $66  million,  compared  with  $49  million  last  year. 

Delinquent  returns  secured. — The  number  of  investigations  con- 
ducted as  a  result  of  preliminary  evidences  of  failure  to  file  returns 
rose  from  1.0  million  in  fiscal  1960  to  1.3  million  in  1961.  This 
investigative  increase  was  responsible  for  a  rise  in  delinquent  returns 
secured  by  district  collection  divisions  from  897,000  during  fiscal 
1960  to  969,000  in  1961.  The  amount  of  tax,  penalties,  and  interest 
on  these  returns  was  $159.2  million,  a  gain  of  38  percent  over  1960. 
In  addition,  district  audit  divisions  secured  95,000  delinquent  returns 
in  connection  with  tax  examinations.  Although  this  was  5,000  fewer 
than  last  year,  additional  tax,  penalties,  and  interest  on  these  returns 
rose  from  $37.9  million  in  1960  to  $50.7  million,  an  increase  of  34 
percent. 

Summary  of  additional  tax  from  enforcement. — Additional  tax,  penal- 
ties, and  interest  assessed  in  1961  as  a  result  of  enforcement  activities 
amounted  to  $2,130  million  as  compared  with  $2,052  million  assessed 
in  1960.  This  was  a  4  percent  increase  and  is  the  highest  annual 
total  in  the  history  of  the  Service,  A  comparison  of  additional  tax 
from  enforcement  during  the  last  two  years  is  shown  in  the  following- 
table. 


Sources 

1960 

1961 

In  thousands  of  dollars 

Additional  tax,  interest,  and  penalties  resulting  from  examination 

1, 786, 915 
112,066 
153,  511 

2, 052, 493 
634, 758 

1, 787, 887 
131,981 
209  873 

Increase  in  individual  income  tax  resulting  from  mathematical  verification 

Tax,  interest,  and  penalties  on  delinquent  returns 

Total  additional  tax,  interest,  and  penalties ..... 

2, 129, 741 

ninims  disnilnwpd 

649, 471 

Fraud  investigations,  indictments,  and  convictions. — The  number  of 
preliminary  investigations  totaled  12,866  in  1961  compared  with 
11,480  in  1960,  and  full-scale  investigations  totaled  3,677  in 
1961  and  3,561  in  1960,  Prosecution  was  recommended  in  2,096 
cases,  an  increase  of  279  over  last  year.  Indictments  were  returned 
against  1,709  defendants  in  1961  compared  with  1,260  in  1960.  In 
the  cases  reaching  the  courtroom,  1,129  pleaded  guilty  or  nolo  con- 
tendere, 102  were  convicted,  49  acquitted,  and  194  were  dismissed. 


198   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

These  compare  with  950  pleas  of  guilty  or  nolo  contendere,  136  con- 
victions, 69  acquittals,  and  204  dismissals  in  1960. 

Nationwide  coordinated  raids  against  wagering  tax  violators  took 
place  in  160  cities  and  resulted  in  421  arrests  and  the  seizure  of  36 
automobiles,  $270,000  in  currency,  and  miscellaneous  gambling 
equipment.  Prosecution  was  recommended  in  781  wagering  cases 
compared  with  524  in  1960. 

Investigation  of  the  tax  affairs  of  major  racketeers  was  emphasized 
in  line  with  the  Service's  participation  in  the  Department  of  Justice 
drive  on  organized  crime.  To  assure  maximum  effort  in  this  program 
as  well  as  in  the  usual  enforcement  activities,  the  authorized  special 
agent  strength  was  increased  by  161. 

The  number  of  convictions  in  the  past  nine  fiscal  years  are  shown  in 
the  following  table. 


Fiscal  year 

Number  of 

individuals 

convicted 

1953 

929 

1954                     

1,291 

1955 - 

1,339 

1956 

1,572 

1957                        

1,256 

1958            

1,096 

1959 - -  -  --- 

909 

I960                                 .                 

1,086 

1961  .                            

1,231 

Alcohol  and  tobacco  tax  administration. — During  1961  the  three 
enforcement  programs  adopted  in  1957  against  illicit  distilleries  liave 
continued  to  be  highly  successful.  The  program  which  concentrates 
on  criminal  cases  against  major  violators  in  critical  enforcement  areas 
was  responsible  for  the  arrest,  conviction,  and  imprisonment  of  many 
syndicate  members  as  well  as  unafhliated  major  violators.  Under 
the  known  defendant  seizure  program,  the  number  and  percentage  of 
distilleries  seized  involving  the  arrest  of  one  or  more  violators  in- 
creased over  1960.  The  program  to  prevent  the  acquisition  of  raw 
materials  used  in  illicit  alcohol  products  continued  to  curtail  supplies. 

Seizures  for  violations  of  alcohol  tax  laws  are  shown  in  the  following 
table. 


Fiscal  year 

Number 
of  stills 
seized 

Gallons  of 
mash 
seized 

Number 

of  arrests 

made  ' 

1940                 - - 

10,663 
8,344 
10, 030 
12, 509 
14, 499 
11,820 
9,272 
9,225 
8,290 
6,826 

6, 480, 200 
2, 945, 000 
4, 892, 600 
7,  375, 300 
8, 643, 200 
6,  756,  600 
5, 140, 800 
4,  655,  600 
4, 274,  400 
3, 669,  500 

25, 638 

1945 -- 

11,104 

1950 

10,236 

1955      

10,  545 

1956      —  - --- 

11,380 

1957           _ 

11,513 

1958      .- - - 

11,631 

1959       

10,  912 

I960     --- 

10,376 

1961 - 

9,503 

'  Includes  arrests  for  firearms  violations  and,  beginning  with  1955,  tobacco  tax  violations.    Arrests  in- 
volving these  two  classes  of  violations  during  1961  numbered  514  and  6,  respectively. 


ADMINISTRATIVE    REPORTS  199 

With  the  implementation  of  the  Excise  Technical  Changes  Act  of 
1958  by  regulations  effective  July  1,  1960,  an  opportunity  was  pro- 
vided to  accelerate  a  change  in  the  concept  of  on-premises  supervision 
which  has  been  in  progress  for  the  past  several  years.  This  change 
involves  two  principal  elements:  Transferring  to  proprietors  the  re- 
sponsibilit37^  for  the  performance  of  various  manual  and  clerical  tasks; 
and  the  use  of  selective  sampling  methods  in  lieu  of  full-time  personal 
supervision. 

After  the  new  regulations  had  been  in  effect  for  several  months, 
a  nationwide  survey  of  inspector  (on-premises)  manpower  require- 
ments was  conducted.  By  using  the  uniform  guides  for  the  assign- 
ment of  Government  officers  to  particular  plant  duties,  it  was 
determined  that  a  saving  could  be  made.  Accordingly,  the  inspector 
(on-premises)  staff  has  been  reduced  through  attrition,  transfers  to 
other  assignments  within  the  Alcohol  and  Tobacco  Tax  Division,  and 
transfers  to  other  Service  activities. 

Inspections  for  the  fiscal  year  aggregated  36,044,  of  which  26,256 
related  to  plants  and  permittees  other  than  dealers.  The  reduction 
in  the  number  of  inspections  (from  38,561  and  28,066,  respectively), 
resulted  primarily  from  the  substitution  of  an  "inspection  by  selec- 
tion" program  for  the  previous  "scheduled  inspection"  program. 

Collections  of  imst-due  accounts. — On  June  30,  1961,  past-due  ac- 
counts on  hand  totaled  960,053  representing  $1.0  billion  in  unpaid 
taxes.  This  was  2  percent  higher  than  a  year  ago  in  number  of 
accounts  and  3  percent  more  in  dollars.  The  increase  was  due  pri- 
marily to  the  large  number  of  accounts  which  became  past  due  during 
the  year  and  which  totaled  2.9  million  and  involved  taxes  of  $1.5 
billion.  This  volume  was  the  second  highest  on  record,  exceeded 
only  in  fiscal  1958. 

Some  increase  in  the  number  of  past-due  accounts  had  been  expected 
in  view  of  anticipated  normal  growth  factors  and  expanded  coverage 
in  both  the  audit  and  delinquent  returns  activities.  The  extent  of 
the  increase,  however,  exceeded  estimates,  primarily  because  of  the 
unforeseen  degree  of  the  economic  recession.  Unemployment  among 
wage  earners  made  both  collections  and  case  disposals  difficult.  This 
factor,  in  addition  to  the  earlier  programmed  increase  in  canvassing 
activity,  precluded  the  possibility  of  bringing  about  a  reduction  in 
inventories. 

Accounts  closed  in  1961  totaled  2.9  million  in  the  amount  of  $1.5 
billion,  of  which  $1.1  billion  was  collected.  Closing  of  accounts  by 
the  office  collection  force  was  responsible  for  65  percent  of  all  accounts 
closed  compared  with  62  percent  in  1960.  The  importance  of  office 
collection  cannot  be  overemphasized,  for  the  extent  of  its  success 
frees  revenue  officer  time  to  handle  the  more  difficult  and  older  cases 
and  to  secure  delinquent  returns.  Accounts  with  balances  two  years 
old  and  over  were  reduced  to  91,924  as  of  June  30,  1961,  compared 
with  134,049  on  hand  a  year  earlier. 

Appeals  and  civil  litigation. — The  14,871  protested  income,  profits, 
estate,  and  gift  tax  cases  referred  by  district  audit  divisions  to  regional 
appellate  divisions  at  the  request  of  taxpayers  was  7  percent  less  than 
the  16,001  received  in  1960.  This  was  the  lowest  volume  of  cases 
referred  since  1956.     The  principal  reason  for  the  decline  was  the 


200   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

increased   emphasis   on   informal   conference   in    the    district    audit 
divisions. 

Disposals,  though  below  1960,  exceeded  receipts  for  the  second 
consecutive  year,  resulting  in  the  lowest  combined  pre-90-day  and 
90-day  case  inventory  in  four  years.  On  June  30,  1961,  such  cases  on 
hand  totaled  10,922  compared  with  11,832  on  hand  at  the  beginning 
of  the  year. 

The  number  of  petitions  filed  with  the  Tax  Court  of  the  United 
States  was  less  than  in  1960.  This,  coupled  with  more  docketed  case 
disposals  than  in  any  previous  year,  caused  the  inventory  of  docketed 
cases  to  decline  to  its  lowest  point  since  1958. 

The  Supreme  Court  decided  10  tax  cases,  sustaining  the  Govern- 
ment's position  in  8  cases.  The  circuit  courts  of  appeals  decided  261 
tax  cases  (exclusive  of  banlo-uptcy,  receivership,  insolvency,  compro- 
mise, and  liquor  cases).  Of  these,  the  Government's  position  was 
supported  in  193  cases. 

Taxpayers  who  have  paid  a  disputed  tax  may  sue  for  refund  in  the 
Court  of  Claims  or  in  a  U.S.  district  court.  The  district  courts  de- 
cided 166  cases  for  the  Government,  192  for  the  taxpayer,  and  39 
cases  partly  for  the  Government  and  partly  for  the  taxpayer.  The 
Court  of  Claims  decided  17  cases  for  the  Government,  24  cases  for  the 
taxpayer,  and  5  partly  for  each. 
Major  administrative  improvements  and  changes 

Savings  from  improvements. — The  management  improvement  pro- 
gram once  again  made  a  major  contribution  to  the  efficiency  and 
effectiveness  of  the  Service.  Through  the  efforts  of  employees  at  all 
levels  in  studying  the  Service's  operations  and  policies  tangible  recur- 
ring savings  of  $3.7  million  were  realized.  The  incentive  awards 
program  added  $755,245  which  brought  the  grand  total  to  $4.5  million. 
In  addition  to  these  recurring  savings  there  were  improvements 
resulting  in  one-time  savings  of  $2.1  million  and  many  other  improve- 
ments of  direct  benefit  to  the  Service  in  its  operations  and  to  the  tax- 
paj'er  by  wa}'  of  better  service  which,  though  not  susceptible  to  meas- 
urement, were  nonetheless  significant. 

District  offices. — Anchorage,  Alaska,  became  the  first  new  internal 
revenue  district  office  in  40  years  on  January  6,  1961.  It  is  the  11th 
district  office  in  the  San  Francisco  region  and  raises  the  total  in  the 
Service  to  62. 

Organizational  changes  in  the  national  office. — The  following  changes 
in  organization  were  made  to  improve  operations  and  provide  better 
management  control. 

Administration  activities  were  regrouped  in  September  1960  and 
placed  under  a  newly  created  office  of  Assistant  Commissioner  for 
Administration.  The  new  Assistant  Commissioner  (Administration) 
assumed  jurisdiction  over  the  formerly  independent  Reports  and  Pub- 
lic Information  Divisions,  as  well  as  the  Facilities  Management, 
Personnel,  and  Training  Divisions. 

On  January  1,  1961,  the  former  Collection  Division  was  converted 
into  two  new  divisions,  the  Collection  Division  and  the  ADP  Division. 
The  ADP  Division  was  given  responsibility  for  putting  in  operation 
the  ADP  system  and  the  closely  related  returns  processing,  revenue 
accounting,  and  service  center  operations.  The  new  Collection  Divi- 
sion retained  responsibility  for  collection  enforcement  activities. 


ADMINISTRATIVE    REPORTS 


201 


The  International  Operations  Division  was  reorganized  as  the  Office 
of  International  Operations  in  August  1960.  The  primary  objectives 
were  to  organize  district-type  operations  along  district  organization 
lines  and  to  establish  a  planning  unit  (Operational  Research  Staff). 

The  two  divisions  under  the  Assistant  Commissioner  (Inspection) 
were  reorganized  in  fiscal  1961  to  provide  better  management  and 
supervision  and  to  meet  growing  responsibilities  arising  from  the 
Service's  long-range  expansion  programs. 

Effective  April  3,  1961,  the  Operating  Facilities  Division  was 
reorganized  and  became  the  Facilities  Management  Division.  The 
major  purpose  was  to  place  all  facilities  management  activities  relat- 
ing to  field  operating  programs  in  one  branch  and  to  place  in  a  separate 
branch  all  administrative  services  performed  for  the  national  office. 
Personnel 

The  Service  concentrated  its  personnel  administration  resources 
during  the  past  year  on  four  major  areas:  A  greatly  expanded  college 
recruitment  program;  development  of  plans  and  procedures  for  rede- 
ploying employees  affected  by  the  conversion  to  automatic  data 
processing;  strengthening  employee-management  relations,  including 
an  employee  opinion  survey;  and  issuance  of  guides  and  standards  for 
extending  the  "Blue  Ribbon"  career  service  program. 

Employees  on  the  rolls  at  the  close  of  1961  numbered  53,680,  com- 
pared with  50,199  a  year  earlier.  There  were  3,031  employees  in  the 
national  office  and  50,649  in  regional  and  district  offices,  and  the 
Office  of  International  Operations.  The  field  service  with  3,152  was 
the  principal  beneficiary  of  the  increase  of  3,481  over  June  30,  1960. 

An  analysis  of  the  personnel  structure  by  type  of  position  for  fiscal 
1960  and  1961  is  shown  in  the  following  table. 


Location  and  type 


Number  on  rolls 
at  close  of  fiscal  year 


By  Location 
National  office.— 

Regional  and  district  offices  '_.- 

Bt  Type 
Permanent  personnel: 

Supervisory  personnel 

Enforcement  personnel: 

Revenue  officers 

Office  auditors 

Tax  examiners 

Revenue  agents -- 

Special  agents 

Alcohol  tax  inspectors 

A  Icohol  tax  investigators 

Storekeeper-gangers.-- 

Total  enforcement  personnel 

Legal  personnel 

Other  technical  personnel 

Clerical  personnel,  messengers,  and  laborers  2 

Total  permanent  personnel 

Temporary  personnel 

Grand  total 


2,702 
47, 497 


5,476 

2,343 

4,123 

10,  583 

1,418 

392 

901 

719 


25, 955 

533 

4,668 

16,  743 


48, 440 

1,759 

50, 199 


3,031 
50, 649 


553 


5,769 

2,657 

4,502 

11,  289 

1,558 

425 

915 

611 


27,  726 

599 

5,101 

17,492 


51,471 
2,209 
53, 680 


1  Includes  Office  of  International  Operations  personnel  (headquarters  and  field  offices)  numbering  307 
for  1960  and  391  for  1961. 
'  Includes  4  overseas  employees  hired  locally. 


202   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Training 

With  pilot  automatic  data  processing  scheduled  in  the  Atlanta 
region  in  fiscal  1962,  and  necessary  preparation  for  soon-to-follow  ADP 
operations  in  other  regions,  the  appropriate  trammg  received  a  high 
degree  of  emphasis.  As  an  initial  step  to  orient  the  Service's  top 
management  in  the  role  and  capabilities  of  ADP,  an  executive  seminar 
was  held  in  October  1960  with  twenty-three  top  Service  officials 
attending.  Another  seminar  was  later  held  m  Atlanta  for  high 
officials  of  that  region  m  anticipation  of  its  ADP  operation. 

In  view  of  the  growth  of  the  training  program  in  recent  years  and 
the  important  role  it  plays  in  the  Service's  activities,  a  task  force 
was  appointed  in  April  to  study  the  entire  trammg  function  and  to 
recommend  improvements. 

Space  and  equipment 

Tlie  Service  reexamined  its  traditional  office  layouts  to  find  ways  of 
housing  more  employees  in  the  space  available.  As  a  result  new  con- 
cepts were  applied  to  office-furniture  arrangements,  and  new  equip- 
ment standards  emerged,  based  on  the  functions  performed  by  Service 
employees  and  the  kinds  of  equipment  actually  needed  for  these 
functions.  New  furniture  and  equipment  in  keeping  with  the  new 
standards  have  been  satisfactorily  tested  and  the  groundwork  has 
been  laid  for  a  revised  long-range  equipment  program. 

Cost  of  administration 

The  cost  of  operatmg  the  Service  in  1961  was  $413.3  million, 
including  $357,000  from  remibursements,  or  99.8  percent  of  the  funds 
available,  compared  with  total  obligations  of  $363.7  million  m  1960. 
Of  the  53,345  man-years  planned,  53,206  man-years,  or  99.7  percent 
were  actually  realized.  This  is  an  increase  of  2,159  over  the  51,047 
man -years  realized  in  1960. 

The  increase  of  $49.6  million  over  fiscal  1960  costs  was  used  to  finance 
a  salary  increase  effective  July  10,  costing  nearly  $26  million;  the 
Service's  contribution  of  approximately  $3  million  for  employees 
health  benefit  plans  which  also  became  effective  July  10;  an  increase 
in  automobile  reimbursement  allowance  from  8  cents  to  10  cents  a 
mile  costhig  about  $1  million;  approximately  $13  million  for  the  first 
step  of  a  long-range  program  to  strengthen  enforcement  and  modernize 
returns  processing  through  conversion  to  automatic  data  processing, 
including  the  pilot  center  in  Atlanta;  personnel  promotions;  and 
increased  requirements  for  and  costs  of  supplies,  equipment,  communi- 
cations, and  space. 
Long-range  planning 

The  Service's  long-range  plan  was  updated  during  1961  to  take 
account  of  revised  workload  projections,  current  work  performance 
rates,  and  new  research  results.  The  plan  provides  for  a  Federal  tax 
administration  equipped  to  deal  with  internal  i-evenue  requirements 
of  a  growing  population  and  a  growing  economy. 

Long-range  ob j  ectives  include  the  modernization  of  returns  processing 
through  use  of  high-speed  electronic  equipment ;  expansion  of  the 
capacity  to  examine  tax  returns  commensurate  with  requirements  to 


ADMINISTRATIVE    REPORTS  203 

maintain  an  adequate  level  of  voluntary  compliance;  increased 
investigative  efforts  aimed  at  tax  evaders,  especially  racketeers;  and 
improvement  of  the  system  to  detect  and  secure  delinquent  returns. 
The  plan  also  provides  for  prompt  collection  of  past-due  accounts 
arising  from  higher  levels  of  tax  enforcement;  strengthening  of 
enforcement-related  activities  such  as  the  Appellate  Division  and 
the  Office  of  the  Chief  Counsel;  and  the  upgrading  and  improvement 
of  space  and  equipment  throughout  the  Service.  These  broad 
programs  are  scheduled  over  a  number  of  years. 

Advisory  group 

The  advisory  group  was  established  in  1959  to  effect  better  coopera- 
tion and  understanding  between  taxpayers,  tax  practitioners,  and  the 
Revenue  Service.  Four  meetings  were  held  with  officials  of  the 
Service  in  1961,  and  discussions  touched  on  all  facets  of  operations. 
From  suggestions  by  members  numerous  improvements  have  been 
made  in  both  administration  and  procedures. 

In  keeping  with  the  Service's  commitment  to  the  members,  the 
terms  of  the  first  group  expired  in  June  1961.  During  that  month  a 
new  panel  of  twelve  high-ranking  lawyers,  accountants,  educators, 
and  businessmen  was  appointed.  Like  their  predecessors,  they  were 
chosen  from  all  sections  of  the  country  and  serve  without  compensation. 
The  new  advisory  group,  at  their  first  meeting  in  June  1961,  suggested 
comprehensive  agenda  for  discussions  throughout  the  coming  year. 
Internal  controls 

Internal  audit. — -In  the  interest  of  efficient  administration,  the 
Service  performs  an  independent  review  and  appraisal  of  its  accounting, 
financial,  and  other  operating  activities.  Coverage  of  all  major  field 
activities  is  required  at  least  once  each  year.  This  includes  the  vari- 
ous segments  of  the  9  regional  offices,  62  district  directors'  ofiices,  3 
service  centers,  and  the  Office  of  International  Operations,  aggregat- 
ing 252  separate  units  subject  to  audit.  For  the  second  consecutive 
year  an  internal  audit  was  made  of  each  of  the  field  activities  except 
those  in  Anchorage  and  the  Atlanta  service  center  which  were  created 
late  in  the  year. 

Internal  security. — -To  strengthen  and  sustain  public  confidence  in 
the  voluntary  self-assessment  system,  special  emphasis  is  being  paid  to 
the  conduct  of  personnel  in  their  official  relations  with  taxpayers  and 
tax  practitioners.  Thorough,  expeditious,  and  impartial  investiga- 
tions are  made  where  there  is  evidence  or  aUegation  of  wrongdoing  on 
the  part  of  employees.  Appficants  for  employment  are  subjected  to 
thorough  character  investigations.  Involved  in  this  area  also  are  the 
investigations  of  enrollees  and  applicants  ibr  enrollment. 

Over  6,000  investigations  of  employees  and  applicants  for  employ- 
ment were  completed  in  1961,  compared  with  nearly  5,000  in  1960. 
An  expanded  recruitment  program  was  responsible  for  much  of  the 
increase. 

Enrollment  of  practitioners 

Lack  of  integrity  on  the  part  of  persons  enrolled  to  practice  before 
the  Internal  Revenue  Service  could  have  a  disastrous  effect  on  revenue 


614359—62 14 


204   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

collections  by  undermining  public  confidence  in  the  tax  system.  The 
Service  is  determined  to  investigate  fully  every  incident  of  corrupt 
practice  and  to  take  swift  action  to  discourage  and  eliminate  further 
occurrences.  The  Director  of  Practice  has  intensified  the  surveillance 
of  improper  activities  by  enrolled  practitioners.  Tax  practitioners 
have  been  put  on  notice  of  the  Service's  great  concern  with  proper 
conduct  in  all  tax  matters  and  they  and  the  public  have  been  asked 
to  assist  the  Service  in  this  effort. 

Office  of  International  Finance 

The  OfRce  of  International  Finance  assists  the  officers  of  the 
Department  in  the  formulation  and  execution  of  policies  and  programs 
in  international  financial  and  monetary  matters. 

By  direction  of  the  Secretary,  the  responsibilities  of  the  Office  of 
International  Finance  include  the  Treasury's  activities  in  relation  to 
international  financial  and  monetary  problems,  covering  such  matters 
as  the  U.S.  balance  of  payments,  the  convertibility  of  currencies, 
exchange  rates  and  restrictions,  and  the  extension  of  stabilization 
credits;  gold  and  silver  policy;  the  Bretton  Woods  Agreements  Act, 
and  the  operations  of  the  International  Monetary  Fund,  the  Inter- 
national Bank  for  Reconstruction  and  Development,  the  Interna- 
tional Finance  Corporation,  the  Inter-American  Development  Bank, 
and  the  International  Development  Association;  foreign  lending  and 
assistance;  the  North  Atlantic  Treaty  Organization;  the  Anglo- 
American  Financial  Agreement;  the  United  States  Exchange  Stabi- 
lization Fund;  and  the  Foreign  Assets  Control. 

The  responsibilities  of  the  Office  of  International  Finance  also 
include  activities  of  the  Treasury  in  relation  to  the  National  Advisory 
Council  on  International  Monetary  and  Financial  Problems.  The 
Secretary  of  the  Treasury  is  Chairman  of  the  Council,  which  was 
established  in  1945  by  the  Bretton  Woods  Agreements  Act  (22  U.S.C. 
286b)  in  order  to  coordinate  the  policies  and  operations  of  the  U.S. 
representatives  on  the  International  Monetary  Fund,  and  the  Inter- 
national Bank,  and  of  all  the  agencies  of  the  Government  which  make 
or  participate  in  making  foreign  loans  or  which  engage  in  foreign 
financial,  exchange,  or  monetary  transactions.  The  acts  authorizing 
U.S.  membership  in  the  International  Finance  Corporation,  the 
Inter-American  Development  Bank,  and  the  International  Develop- 
ment Association  also  provide  for  the  coordination  by  the  National 
Advisory  Council  of  the  U.S.  representatives  to  these  institutions. 

The  Office  also  acts  for  the  Treasury  on  the  financial  aspects  of 
international  treaties,  agreements,  and  organizations  in  which  the 
United  States  participates,  and  it  takes  part  in  negotiations  with 
foreign  governments  with  regard  to  matters  included  within  its 
responsibilities.  It  assists  the  Secretary  on  international  financial 
aspects  of  problems  arising  in  connection  with  his  responsibilities 
under  the  Tarift'  Act. 


ADMINISTRATIVE    REPORTS  205 

The  OfRce  of  International  Finance  advises  Treasury  officials  and 
other  departments  and  agencies  of  the  Government  concerning 
exchange  rates  and  other  financial  problems  encountered  in  operations 
involving  foreign  currencies.  In  particular,  it  advises  the  Depart- 
ment of  State  and  the  Department  of  Defense  on  financial  matters 
related  to  their  normal  operations  in  foreign  countries  and  on  the 
special  financial  problems  arising  from  defense  preparation  and 
military  operations.  In  conjunction  with  its  other  activities  the  Office 
studies  the  financial  policies  of  foreign  countries,  exchange  rates, 
balances  of  payments,  the  flow  of  capital,  and  other  related  problems. 

The  Division  of  Foreign  Assets  Control  administers  certain  regula- 
tions and  orders  issued  under  section  5(b)  of  the  Trading  with  the 
Enemy  Act.  The  Foreign  Assets  Control  Regulations  block  all 
property  in  the  United  States  in  which  any  Communist  Chinese  or 
North  Korean  interest  exists  and  prohibit  all  trade  or  other  financial 
transactions  with  those  areas  or  their  nationals.  The  Control  carries 
on  licensing  activities  in  connection  with  transactions  otherwise 
prohibited  and  takes  action  to  enforce  the  regulations. 

The  Control  also  administers  regulations  which  prohibit  persons 
in  the  United  States  from  purchasing,  selling,  or  arranging  the  purchase 
or  sale  of  strategic  commodities  outside  the  United  States  for  ultimate 
shipment  to  the  Soviet  bloc.  The  latter  regulations  supplement  the 
export  control  laws  administered  by  the  Department  of  Commerce. 

Bureau  of  the  Mint  ^ 

The  principal  fimctions  of  the  Bureau  of  the  Mint  include  the 
manufacture  of  coin,  both  domestic  and  foreign;  the  distribution  of 
domestic  coin  between  the  mints,  the  Federal  Reserve  Banks  and 
branches,  and  the  Treasurer  of  the  United  States  in  Washington, 
D.C.;  the  custody,  processing,  and  movement  of  gold  and  silver 
bullion;  the  administration  of  the  regulations  issued  under  the  Gold 
Reserve  Act  of  1934,  as  amended  (31  U.S.C.  440-446),  and  section  5b 
of  the  act  of  October  6,  1917,  as  amended  (12  U.S.C.  95a),  including 
the  issuance  and  denial  of  licenses,  the  purchase  of  gold,  and  the  sale 
of  gold  buUion  for  industrial  use;  the  administration  of  silver  regula- 
tions issued  under  the  acts  of  July  6,  1939  (31  U.S.C.  316c),  and 
July  31,  1946  (31  U.S.C.  316d);  the  manufacture  of  historic  and 
special  Government  medals;  and  other  technical  services. 

In  addition  to  the  Office  of  the  Director  of  the  Mint  in  Washington, 
D.C.,  six  field  institutions  were  in  operation  during  the  fiscal  year 
1961,  consisting  of  the  Philadelphia  and  Denver  mints  where  coins 
are  manufactured;  the  San  Francisco  Mint,  operating  as  an  assay 
office  and  bullion  depository;  the  Fort  Knox  Gold  Bullion  Deposi- 
tory; the  New  York  Assay  Office;  and  the  West  Point  Silver  BuJHon 
Depository  which  operates  as  an  adjunct  of  the  New  York  Assay 
Office. 


'  Additional  information  concerning  the  Bureau  of  the  Mint  is  contained  in  the  separate  annual  report 
of  the  Director  of  the  Mint. 


206 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Coinage 

The  mints  manufactured  3.1  billion  domestic  coins  during  the  fiscal 
year  1961,  an  increase  of  19  percent  over  the  previous  year's  output 
of  2.6  billion  coins.  The  following  table  shows  production  of  the 
five  denominations  coined  during  the  year. 


Metallic  composition 

Production  ' 

Denomination  ' 

Number 
of  coins 

Face 
value 

Standard 
gross 
weight 

In  millions 

Short 
tons 

Bronze  (95%  copper,  5%  zinc  and  tin) 

2,461.9 

210.4 

305.7 

74.6 

18.5 

$24.6 

10.5 

30.6 

18.6 

9.2 

8,440 

5-cent  pieces       

Cupronickel  (75%  copper,  25%  nickel)  . 

1,159 

Dimes      -. 

900  parts  silver,  100  parts  copper. .     

842 

do - 

514 

Half  dollars 

do        , 

255 

Total 

3,071.1 

93.6 

3  11,210 

'  No  silver  dollars  were  coined  during  the  year;  the  last  dollar  coinage  was  in  September  1935. 

2  Includes  2,451,800  sets  of  proof  coins. 

3  Consists  of  1,450  tons  of  silver,  9,048  tons  of  copper,  290  tons  of  nickel,  and  422  tons  of  zinc  and  tin. 

In  addition  to  domestic  coinage,  the  Philadelphia  Mint  manufac- 
tured 110.4  million  coins  for  four  foreign  governments,  as  follows: 


Government 

Denomination 

Metallic  composition 

Number  of 
coins  pro- 
duced (in 
millions) 

Dominican  Republic... 

0.1 

do 

.6 

Total  -         ... 

.7 

5  centavos 

75%  copper,  25%  nickel     

El  Salvador 

6.0 

50  cents  . 

900  parts  silver,  100  parts  copper   

.7 

do 

.4 

10  cents 

do 

.2 

5  cents.. 

75%  copper,  25%  nickel 

.2 

1  cent 

95%  copper,  5%  zinc 

2.0 

Total.. 

3.5 

1  peso 

900  parts  silver,  100  parts  copper 

Philippines 

.1 

J^  peso 

do --.  -  .-. 

.1 

10  centavos. 

70%copper,  18%  zinc,  12%  nickel 

80%  copper,  20%  zinc 

40.0 
40.0 

1  centavo 

95%  copper,  5%  zinc 

20.0 

Total 

100.2 

Ornnri  total 

110.4 

Dm-ing  the  fiscal  year  1961  the  mints  issued  3.1  billion  domestic 
coins  for  cuculation,  compared  with  2.7  billion  coins  in  1960.  The 
six  denominations  issued  are  shown  in  the  follomng  table. 


ADMINISTRATIVE    REPORTS 


207 


Denomination 

Number  of 
coins  issued  • 

Face  value 

Gross  weight 

In  millions 

Short  tons 

1-cent  pieces.                                                .      - 

2,454.8 
225.5 
303.7 
80.2 
20.2 
23.7 

$24.5 
11.3 
30.4 
20.0 
10.1 
23.7 

8  416 

1,243 

837 

552 

Half  dollars                                              -          .  .        .    .      _ 

278 

697 

Total 

3, 108. 1 

120.0 

12, 023 

'  Includes  2,451,619  sets  of  proof  coins  sold  by  the  Philadelphia  Mint.    A  set  consists  of  five  coins  (H,  5(i, 
10^,  25ji,  and  50^  denominations). 

The  total  stock  of  domestic  coins,  comprising  the  amount  held  in 
the  mints  and  other  Treasury  offices,  in  Federal  Reserve  Banks, 
commercial  banks,  and  in  the  hands  of  the  public,  is  compared  at  the 
close  of  the  past  two  fiscal  years  as  follows: 


Face  value  (in  millions) 

stock  of  U.S.  coins 

June  30,  1960 

June  30,  1961 

Increase,  or 
decrease  (— ) 

Minor  coins    .    -          --           --    _.--.    .      ... 

$559. 1 

1, 552. 1 

487.8 

$594. 1 

1, 608.  7 

487.6 

$34.9 

56.6 

Silver  dollars                   -              . 

1  —.2 

Total 

2,  599. 0 

2, 690.  3 

91.3 

'  Decrease  represents  the  amount  of  uncurrent  (worn)  silver  dollars  withdrawn  from  circulation  and 
returned  to  the  mints  during  fiscal  1961. 

Gold 

The  three  mints  and  the  New  York  Assay  Office  received  6.0 
million  fine  ounces  of  gold  valued  at  $211.3  million  during  fiscal  1961. 
Issues  of  gold  totaled  63.2  million  ounces  valued  at  $2,211.9  million, 
including  sales  of  2.0  million  ounces  valued  at  $69.0  million  for  domestic 
industrial,  professional,  and  artistic  use.  Gold  in  the  Fort  Knox 
Depository  amounted  to  356.7  million  ounces  valued  at  $12,483.4 
million  throughout  the  year.  Total  holdings  and  transactions  are 
shown  in  the  following  table. 


Gold  holdings  and  transactions  (e.xeluding  intermint  transfers  ') 

Fine  ounces 

Value 

In  millions 

Holdings  on  June  30,  1960 

552.1 

6.0 

63.2 

494.9 

$19, 322. 2 
211  3 

Receipts   .    . .    _. 

Issues. - 

2,211.9 
17,321.5 

Holdings  on  .Time  30,  1961 

Net  decrease    .              ...... 

57.2 

2, 000.  7 

'  Intermint  transfers  amounted  to  67.2  million  ounces  valued  at  $2,353.5  million  during  fiscal  1961. 


208        1961    REPORT    OF    THE    SECRETARY    OF   THE    TREASURY 


Silver 

Silver  bullion  transactions  made  at  the  mints,  the  New  York  Assay 
Office,  and  the  West  Point  Depository,  and  beginning  and  end-of-year 
holdings  of  the  five  institutions  are  summarized  in  the  following 
statement. 


Silver  bullion  holdings  and  transactions  (excluding  intermint  transfers  0 


Fine  ounces 
(in  millions) 


Holdings  on  June  30, 1960 

RccGiptsr 

Newly  mined  domestic  silver,  act  of  July  31, 1946  (31  U.S.C.  316d) 

Lend-lease  silver  from  foreign  governments: 

India.. 

Pakistan 

Saudi  Arabia 

Total  lend-lease  silver 

Recoinage  bullion  from  un current  U.S.  silver  coins 

other  miscellaneous  receipts 

Total  receipts 

Issues: 

Manufactured  into  U.S.  subsidiary  silver  coins 

Sold  under  act  of  July  31,  1946  (31  U.S.C.  316d) 

Other  miscellaneous  issues 

Total  issues 

Holdings  on  June  30,  1961 -.. 

Net  decrease  in  silver  bullion .- 


2 1, 834. 1 


.3 


1.1 

.8 
1.4 


3.3 
1.1 
.3 


5.0 


(*) 


42.3 
40.5 


3  1,  756. 2 
77.9 


*Less  than  500,000. 

'  Intermint  transfers,  including  physical  and  book  transfers,  amounted  to  175.4  million  ounces  during 
fiscal  1961. 

2  Includes  1,677.1  million  ounces  held  as  security  for  silver  certificates. 

3  Includes  1,677.3  million  ounces  held  as  security  for  silver  certificates. 

Revenue  and  monetary  assets 

Revenue  deposited  by  the  Bureau  of  the  Mint  into  the  general 
fund  of  the  Treasury  totaled  $62.4  milUon  during  the  fiscal  year. 
Seigniorage  on  the  398.8  million  subsidiary  silver  coins  manufactured 
amounted  to  $26.9  million  and  on  the  2,672.3  million  minor  coins 
manufactured,  $28.4  million.  Seigniorage  on  the  0.2  million  ounces 
of  silver  bullion  revalued  from  cost  to  monetary  value  as  security  for 
silver  certificates  amounted  to  $0.1  million.  In  addition  to  the 
$55.4  million  in  seigniorage,  other  miscellaneous  deposits  amounted 
to  $7.0  million. 

Monetary  assets  of  gold  and  silver  bullion,  silver  and  minor  coins, 
and  other  values  in  the  six  mint  institutions  totaled  $21.7  billion  at 
the  beginning  of  the  fiscal  year  and  $19.6  billion  at  the  close  of 
the  year. 

United  States  gold  and  silver  production  and  consumption 

The  estimates  of  United  States  gold  and  silver  production  and 
issues  of  gold  and  silver  for  domestic  industrial,  professional,  and 
artistic  use,  made  annuall}^  by  the  Office  of  the  Director  of  the  Mint, 
are  on  a  calendar  year  basis. 

Domestic  gold  production  totaled  1,679,800  fine  ounces  during  the 
calendar  year  1960,  compared  with  1,635,000  ounces  in  1959.  Silver 
production  in  1960  totaled  36,800,000  fine  ounces,  compared  with 
23,000,000  ounces  in  1959. 


ADMINISTRATIVE    REPORTS  209 

Gold  and  silver  issued  in  1960  for  domestic  industrial,  professional, 
and  artistic  use  amounted  to  3,000,000  ounces  and  102,000,000  ounces, 
respectively,  compared  with  2,521,800  ounces  and  101,000,000  ounces 
in  1959. 
Management  improvement 

In  the  fiscal  year  1961  the  Mint's  management  improvement 
program  achieved  total  annual  recurring  savings  of  $56,200.  At  the 
Philadelphia  Mint  the  installation  of  automatic  data  processing 
equipment  for  the  processing  of  proof  coin  orders  resulted  in  savings 
of  $40,000  which  related  to  reimbursable  operations.  Savings  of 
$16,200  relating  to  appropriation  items  were  effected  by  improved 
coinage  operations  at  Philadelphia  and  Denver,  and  improved  refinery 
operations  at  the  New  York  Assay  Office.  Appropriation  savings 
were  applied  to  offset  partially  wage  increases  granted  to  per  diem 
employees,  and  increased  costs  of  supplies  and  materials. 

Continuing  attention  was  given  throughout  the  year  to  the  incentive 
awards  program,  records  management,  safety,  control  of  communica- 
tion costs,  and  forms  and  reports  control.  Cash  awards  amounting 
to  $580  were  granted  to  employees  for  suggestions  resulting  in  savings 
of  $9,382  per  year  and  intangible  benefits. 

Bureau  of  Narcotics  ^ 

The  Bureau  of  Narcotics  is  responsible  for  the  prevention, 
investigation,  and  detection  of  violations  of  the  Federal  narcotic 
and  marihuana  laws. 

The  principal  objectives  of  the  Bureau  are:  To  suppress  the  illicit 
traffic  in  such  drugs  and  thus  avoid  the  spread  of  addiction ;  to  control 
the  legitimate  manufacture  and  distribution  of  narcotic  medicines 
and  prevent  their  diversion  for  addiction  purposes;  to  cooperate, 
through  the  State  Department,  with  other  governments  in  control 
of  the  international  drug  traffic  and  the  discharge  of  the  obligations 
of  the  United  States  under  the  several  narcotics  conventions  and 
protocols;  and  to  cooperate  with  the  several  States  in  narcotic  drug 
legislation  and  local  law  enforcement. 

Law  enforcement 

To  suppress  the  illicit  traffic  the  Bureau  concentrates  its  efforts  as 
far  as  possible  on :  Eliminating  foreign  sources  of  supply  of  clandestine 
drugs  and  preventing  their  smuggling  into  the  United  States;  detect- 
ing and  preventing  illicit  interstate  traffic;  detecting  and  eliminating 
wholesale  traffic  within  the  States;  and  cooperating  with  State  and 
local  officials  to  eliminate  retail  peddling  and  promote  the  treatment 
and  cure  of  addicts. 

In  foreign  countries  investigation,  surveillance,  and  negotiation  are 
undertaken  to  detect  and  locate  narcotic  drugs  intended  for  illicit 
traffic  and  prevent  their  entrance  into  this  country.  During  the  fiscal 
year  1961  through  cooperation  with  the  Canadian,  French,  Greek, 
Italian,  Lebanese,  Mexican,  Swiss,  Syi'ian,  and  Turkish  Governments 
large  quantities  of  crude,  semiprocessed,  and  finished  products  destined 
for  the  United  States  were  seized,  leading  in  some  instances  to  the 
closing  of  large  clandestine  laboratories.    The  lines  of  supply  of  heroin 

•  Further  information  is  available  in  the  separate  report  of  the  Bureau  of  Narcotics  entitled,  Traffic  in 
Opium  and  Other  Dangerous  Drugs  for  the  Year  Ended  December  SI,  1960. 


210   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

originating  in  Communist  Cliina  were  further  disrupted,  and  the  Bu- 
reau continued  its  guard  against  the  huge  supphes  of  opium  and  heroin 
which  are  available  in  that  area. 

The  Narcotic  Control  Act  of  1956  (21  U.S.C.  174)  continues  to  be 
an  important  and  effective  aid  in  discouraging  the  illicit  traffic  in  the 
United  States,  as  reflected  in  the  longer  sentences  imposed.  For  un- 
registered narcotic  violators  the  average  sentence  per  conviction  was 
6  years  6  months  in  1961  as  compared  with  3  years  7  months  in  fiscal 
1956,  the  last  year  preceding  enactment  of  this  law;  and  for  marihuana 
violators  the  average  was  5  years  2  months  as  compared  with  3  years 
4  months  in  1956.  In  jurisdictions  where  the  policy  of  heavier  sen- 
tences applies,  continued  stiffening  of  penalties  is  acting  as  a  steadily 
increasing  deterrent  to  illicit  traffic. 

In  its  enforcement  activities  during  the  year  the  Bureau  seized  a 
total  of  157,358  grams  of  narcotics  as  compared  with  74,444  grams  in 
1960.  Seizures  of  marihuana  amounted  to  620,437  grams  bulk  and 
776  cigarettes  as  compared  with  1,529,722  grams  bulk  and  731  ciga- 
rettes in  1960. 

Number  of  violations  of  the  narcotic  and  marihuana  laws  reported  during  the  fiscal 
year  1961  with  their  dispositions  and  penalties 


Narcotic  laws 

Marihuana  laws 

Registered  persons 

Nonregistered  persons 

Nonregistered  persons 

Federal 
Court 

state 
Court 

Federal 
Court 

State 
Court 

Federal 
Court 

State 
Court 

Pending  July  1,  I960- 

Reported  during  1961  ' 

11 
5 

935 
1,481 

100 
163 

Total  to  be  disposed 
of  1 - 

16 

2,416 

263 

5 
5 

1 
1 

880 
29 
205 

330 
10 

57 

83 

2 

23 

55 

1 

15 

Total  disposed  of'.. 

12 

1,511 

179 

Pending  June  30,  1961  '... 

4 

905 

84 

Sentences  imposed 

Yrs. 
20 

Mos. 

Yrs. 
5 

Moi. 

Yrs. 
5,731 

Mos. 
1 

Yts. 
1,254 

Mos. 
6 

Yts. 
429 

Mas. 

Yrs. 
217 

Mos. 
8 

Fines  imposed  

$8,000 

$3,020 

$112, 181 

$7, 105 

$503 

$3,  550 

Average  sentence  per  con- 
viction: 
1961    

Yts. 

4 

2 

Mos. 

"'ib' 

Yts. 

5 

4 

Mos. 

Yts. 

6 
6 

Mos. 

6 

8 

Yts. 

3 
3 

Mos. 

10 
11 

Yrs. 

5 
5 

Mos. 

2 
4 

Yrs. 

3 

4 

Mos. 
11 

1960 

8 

Average  fine  per  convic- 
tion: 
1961    

$1,600 
1,000 

$3,020 

$127 
166 

$21 
30 

$6 
85 

$64 

1960 

36 

'  All  violations  reported  and  disposed  of  during  1961  were  Federal  c^ses,  that  is.  those  made  by  Federal 
officers  working  independently.  There  were  no  joint  cases  (those  made  by  Federal  and  State  officers  work- 
ing in  cooperation). 


ADMINISTRATIVE    REPORTS  211 

The  number  of  violations  of  the  narcotic  laws  reported  by  Federal 
narcotic  enforcement  officers  is  shown  in  the  preceding  table.  Viola- 
tions by  persons  registered  to  engage  in  legitimate  narcotic  and  mari- 
huana activities  are  shown  separately  from  those  by  persons  who  were 
not  qualified  by  registration  to  possess  or  handle  the  drugs. 

Control  of  manufacture  and  medical  distribution 

In  its  control  of  the  legitimate  trade  the  Bureau  issues  permits  for 
imports  of  the  crude  materials,  for  exports  of  finished  drugs,  and  for 
the  intransit  movement  of  narcotic  drugs  and  preparations  passing 
through  the  United  States  from  one  foreign  country  to  another.  It 
supervises  the  manufacture  and  distribution  of  narcotic  medicines 
within  the  country  and  has  authority  to  license  the  growing  of  opium 
poppies  to  meet  the  medicinal  needs  of  the  country  if  and  when  their 
production  should  become  in  the  public  interest. 

Under  the  Narcotics  Manufacturing  Act  of  1960  (21  U.S.C.  501-517, 
26  U.S.C.  4702,  4731)  the  Bureau  determines,  in  the  interest  of  public 
health  and  safety,  what  narcotic  drugs  shall  be  manufactured  and  used 
by  establishing  "basic  classes"  for  those  which  are  authorized.  It 
licenses  the  manufacture  of  such  drugs  and  fixes  annual  manufactur- 
ing quotas  for  each  producer,  thus  keeping  total  production  within 
predetermined  medical  and  scientific  requirements.  Under  that  act 
the  Bureau,  with  the  assistance  of  an  Advisory  Committee,  also  clas- 
sifies narcotic  drugs  and  their  pharmaceutical  preparations  into  various 
control  categories,  applying  to  each  category  that  degree  of  control 
which  is  found  to  be  warranted  by  its  risk  of  addiction  or  abuse. 

The  unportation,  manufacture,  and  distribution  of  opiuni  and  coca 
leaves  and  their  derivatives  are  subjected  to  a  system  of  quotas  and 
allocations  designed  to  insure  their  proper  distribution  for  medical 
needs.  During  the  year,  100,354  kilograms  of  raw  opium  were  im- 
ported fiom  Burma,  Turkey,  and  India,  and  132,340  kilograms  of  coca 
leaves  were  imported  from  Peru  to  meet  medical  requirements  for 
opium  derivatives  and  cocaine  and  to  supply  nonnarcotic  coca  flavoring 
extracts.  The  latter  were  obtained  as  a  byproduct  from  the  same 
leaves  from  which  the  cocaine  was  simultaneously  extracted. 

The  quantity  of  narcotic  drugs  exported  dm*ing  1961  was  more  than 
twice  that  exported  during  1960.  The  export  total,  however,  has 
never  been  significant  in  comparison  with  the  quantity  used  within 
the  United  States.  Principally  because  of  the  large  medical  con- 
sumption of  pethidine,  codeine,  and  papaverine,  the  manufactiu'e  of 
narcotics  continued  extensive. 

There  were  1,671  thefts  of  narcotics,  amounting  to  65,406  grams, 
reported  during  1961  from  persons  authorized  to  handle  the  drugs  as 
compared  with  1,446  thefts  amounting  to  52,500  grams  in  1960. 

Almost  all  of  the  approxmiately  337,910  persons  registered  to  engage 
in  lawful  narcotic  and  marihuana  activities  were  employed  in  the 
manufacture,  wholesale  or  retail  distribution,  or  dispensing  or  pre- 
scribing of  narcotic  drugs  for  legitimate  medical  uses.  As  industrial 
and  scientific  users  of  narcotic  substances  are  few  in  number,  the 
quantities  used  for  these  purposes  are  insignificant. 


212   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

International  cooperation 

For  each  calendar  year  the  Bureau  submits  to  appropriate  agencies 
of  the  United  Nations  advance  estimates  of  requirements  for  each  basic 
drug  covered  by  the  several  international  conventions,  and  after  the 
year  has  ended,  full  and  complete  statistics  of  their  manufacture,  dis- 
tribution, miports,  exports,  and  stocks.  It  applies  a  system  of  im- 
port, export,  and  intransit  permits  which  conforms  to  the  requirements 
of  these  conventions  as  well  as  to  our  own  Narcotic  Drugs  Import  and 
Export  Act.  It  exchanges,  direct  with  the  narcotics  control  author- 
ities of  other  governments,  information  relating  to  movements  of  drugs 
under  such  permits,  as  well  as  information  relating  to  illicit  trafRckers 
and  illicit  movements  of  narcotics  between  countries.  Through  the 
State  Department  the  Bureau  cooperates  in  matters  of  narcotic  policy 
with  other  governments  and  with  the  United  Nations.  The  Commis- 
sioner of  Narcotics  is  the  United  States  Representative  on  the  United 
Nations  Commission  on  Narcotic  Drugs,  which  meets  annually  to 
review  the  work  of  the  various  international  agencies  concerned  with 
narcotics  and  to  make  recommendations  on  narcotic  matters  to  the 
Economic  and  Social  Council. 

An  agreement  to  limit  the  production\)f  opimii  to  world  medical 
and  scientific  needs  was  signed  at  the  United  Nations  on  June  23,  1953, 
and  approved  by 'the  United  States  Senate  August  20,  1954.  The  approval 
was  followed  by  Senate  Resolution  290  of  June  14,  1956,  urging  other 
governments  also  to  ratify.  This  Protocol  requires  the  ratifications 
of  25  states  including  any  three  of  seven  named  producing  countries 
and  any  three  of  nine  named  manufacturing  countries.  As  of  June  30, 
1961,  39  ratifications  had  been  deposited  including  six  from  manufac- 
turing countries  and  two  from  producing  countries.  When  one  addi- 
tional producing  state  has  deposited  its  ratification  the  Protocol  will 
become  effective  and  should  then  accomplish  a  much  further  reduc- 
tion in  the  amount  of  opium  available  to  the  illicit  traffic. 

Cooperation  with  States  and  municipalities 

Excellent  cooperation  continues  among  Federal,  State,  and  munici- 
pal narcotic  law  enforcement  agencies  in  the  exchange  of  law  enforce- 
ment information  and  in  local  law  enforcement  activities.  Many 
types  of  minor  violations  and  routine  inspections  formerly  handled  by 
the  Bureau  are  now  referred  to  local  or  State  authorities  for  investiga- 
tion and  prosecution,  or  are  investigated  jointly  with  them. 

The  names  of  46,936  active  addicts,  many  of  which  were  reported 
by  State  and  municipal  agencies,  were  recorded  in  the  Bm'eau's  central 
index  as  of  June  30,  1961. 

Scope  of  activities 

The  scope  of  the  Bureau's  operations  continues  to  enlarge  as  addi- 
tional drugs  are  made  subject  to  the  narcotic  laws.  Opium  and  coca 
leaves  and  their  derivatives  have  been  under  national  control  since 
1915.  Marihuana  has  been  under  control  since  1937.  Isonipecaine, 
a  synthetic  known  more  generally  as  meperidine  and  internationall}^  as 
pethidine,  was  brought  under  control  in  1944;  and  under  the  act  of 
March  8,  1946  (26  U.S.C.  4731(g)),  42  other  synthetic  narcotics  have 
been  brought  under  control  through  administrative  procedures  pro- 
vided by  the  act. 


ADMINISTRATIVE    REPORTS  213 

Internationally,  opium,  coca  leaves,  marihuana,  and  their  more  im- 
portant derivatives  have  been  under  control  by  the  terms  of  the 
Opium  Conventions  of  1912,  1925,  and  1931.  In  addition,  under 
Article  II  of  the  1931  Convention  and  the  international  Protocol  of 
November  19,  1948,  nine  secondary  derivatives  of  opium  and  45  syn- 
thetic drugs  have  been  found  by  the  World  Health  Organization  to 
have  addicting  qualities  similar  to  morphine  or  cocaine  and  have 
been  brought  under  the  controls  provided  by  the  treaties. 

Training  schools 

The  Bureau's  narcotics  training  school,  stafled  by  20  experts  in  nar- 
cotic law  enforcement,  has  now  graduated  707  State  and  municipal  law 
enforcement  officers  representing  322  separate  agencies  from  45  States, 
the  District  of  Columbia,  and  Puerto  Rico.  Seventy-two  foreign  law 
enforcement  officers,  representing  32  separate  agencies,  from  Afghanis- 
tan, Belgium,  Bolivia,  Canada,  Ceylon,  Ecuador,  Ethiopia,  Indonesia, 
Iran,  Iraq,  Japan,  Jordan,  Korea,  Lebanon,  Mexico,  Peru,  Philippines, 
Thailand,  Turkey,  and  Venezuela  also  have  attended.  Twenty-one 
narcotic  agents  attended  the  Treasury  Law  Enforcement  School  during 
the  year  and  three  attended  its  Technical  Equipment  Operators' 
School.  Thirty-eight  employees  were  paid  cash  awards  totaling 
$11,450  under  the  incentive  awards  program  for  adopted  suggestions 
or  special  acts  and  services. 

Management  improvement 

I  During  the  fiscal  year  the  Bureau  completed  the  changeover  from  the 
complicated  avoirdupois  system  of  pounds,  ounces,  and  grains  to  the 
simpler  metric  system  of  kilograms,  grams,  and  milligrams  for  manu- 
facturers' reporting  and  accounting  for  narcotic  drugs.  The  reporting 
of  wholesalers'  monthly  returns  and  annual  inventories  was  also 
simplified  in  a  manner  that  saves  these  registrants  thousands  of  man- 
hours  annually  in  their  preparation.  Improvements  have  been  made 
in  methods  of  accumulating  data  for  export  statistics  and  their  more 
prompt  reporting  to  international  authorities.  Automatic  accounting 
equipment  has  been  installed  to  increase  the  efficiency  of  payroll 
operations. 

United  States  Coast  Guard 

The  United  States  Coast  Guard  is  responsible  for  enforcing  Federal 
laws  on  navigable  waters  subject  to  the  jurisdiction  of  the  United 
States.  These  laws  govern  navigation,  shipping,  and  other  maritime 
operations,  and  the  related  protection  of  life  and  property.  The 
Service  also  promotes  the  safety  of  merchant  vessels,  and  designs, 
installs,  maintains,  and  operates  aids  to  maritime  navigation  for  com- 
merce and  the  Armed  Forces.  By  training  and  maintaining  an  ade- 
quate Reserve  force,  the  Coast  Guard  fulfills  a  further  responsibility 
which  consists  of  maintaining  a  state  of  readiness  to  operate  as  a 
specialized  service  of  the  Navy  in  time  of  war  or  national  emergency. 

iThe  primary  duties  of  the  Service  are  defined  in  Title  14  of  the  United 
States  Code. 
1 


214    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Search  and  rescue  operalions 

The  responsibility  for  coordinating  search  and  rescue  operations 
in  the  Western  Atlantic  and  most  of  the  Pacific  Ocean  is  vested  in  the 
Coast  Guard.  Some  typical  examples  of  assistance  rendered  during 
the  fiscal  year  follow. 

Aircraft  ditching. — On  July  14,  1960,  a  Northwest  Airlines  DC-7C 
aircraft  carrying  58  persons  reported  that  it  would  be  forced  to  ditch 
in  Philippine  waters  because  of  fuselage  damage  and  an  engine  fire 
resulting  from  the  loss  of  a  propeller.  An  air  search,  coordinated  by 
the  Coast  Guard,  was  made  in  the  vicinity  of  the  Polillo  Islands. 
After  sighting  four  life  rafts,  a  Coast  Guard  UF  aircraft  landed  and 
rescued  23  survivors.  Thirty-four  others  were  rescued  by  a  Navy 
P5M  plane,  which  also  recovered  from  the  water  the  body  of  the  only 
fatality. 

Ship  collision.- — Early  in  the  morning  of  October  22,  1960,  the 
S.S.  Alcoa  Corsair  was  beached  after  being  severely  damaged  in  a 
collision  with  the  S.S.  Lorenzo  Marcello  near  the  mouth  of  the  Missis- 
sippi River.  Although  the  Lorenzo  Marcello  had  no  casualties  and 
could  proceed  to  New  Orleans,  the  Alcoa  Corsair  had  eight  fatalities, 
nine  injured,  and  one  missing.  Four  of  the  critically  injured  were  re- 
moved by  a  Coast  Guard  helicopter.  The  remaining  injured  crewmen 
were  ferried  ashore  to  waiting  ambulances  by  Coast  Guard  boats  and 
other  craft. 

Midair  collision. — In  the  New  York  City  area  on  December  16, 
1960,  a  United  Airlines  DC-8  with  83  passengers  aboard  collided 
with  a  TWA  Super  Constellation  carrying  42.  Coast  Guard  heli- 
copters working  with  Army,  Navy,  and  New  York  Police  Force  air- 
craft transported  injured  passengers  from  the  Constellation,  which 
crashed  on  Staten  Island,  to  a  nearby  hospital.  Coast  Guard  vessels 
also  searched  the  New  York  harbor  area  and  recovered  debris  for  the 
Civil  Aeronautics  Board  to  assist  in  determining  the  cause  of  the 
mishap. 

Tanker  broken  in  two. — On  December  21,  1960,  the  Coast  Guard 
received  a  report  that  the  tanker  Pine  Ridge  with  37  crewmen  aboard 
was  breaking  in  two  about  120  miles  off  Cape  Hatteras.  Coast  Guard 
aircraft  and  vessels  were  dispatched  to  the  scene  together  with  nearby 
merchant  vessels.  Naval  vessels,  including  the  aircraft  carrier 
Valley  Forge,  were  made  available  when  needed.  A  Coast  Guard 
UF-2G  plane  on  the  scene  observed  that  the  bow  section  of  the  Pine 
Ridge  had  capsized  throwing  crewmen  overboard,  while  the  stern  sec- 
tion remained  afloat  and  upright.  The  tanker  Artemis,  on-scene, 
attempted  to  rescue  the  seamen  who  were  thrown  in  the  water,  but 
was  rebuffed  by  mountainous  seas.  Liferafts  and  emergency  ec^uip- 
ment  were  air-dropped,  and  helicopters  from  the  Valley  Forge  removed 
28  survivors  from  the  stern  section.  A  widespread  air  and  surface 
search  was  made  for  nine  missing  crewmen  and  the  bow  section, 
but  only  debris  and  lifejackets  were  found. 

A  statistical  summary  of  search  and  rescue  assistance  for  the  fiscal 
year  1961  follows. 


ADMINISTRATIVE    REPORTS 


215 


Rescue  operations 


I 


By  avia- 
tion units 


By  vessels 


By  other 
equipment 


Total 


Vessels  assisted: 

Refloated  (number) 

Towed  (number) 

Otherwise  aided  (number) 

Property  involved  (value  including  cargo) 

Miles  towed 

Aircraft  assisted: 

Escorted  (number) 

Otherwise  aided  (number) 

Property  involved  (value  including  cargo) 

Miles  escorted 

Persons  assisted 

Miscellaneous  assisted  (floods,  forest  fires,  etc.) 

Attempts  to  assist  (no  physical  assistance  rendered). 
Persons  involved  (number) : 

Rescued 

Medical  assistance  furnished.- 

Other  assistance 

Miscellaneous  property  involved  (value) 


83 

379 

1,004 


383 

168 


87 
1,874 


202 
2,219 
1,063 


403 

159 

1,535 


1,625 
8,666 
3,454 


5 
179 


1,705 
1,015 
5,413 


1,910 

11,264 

5,521 

$627, 394, 900 

119, 696 

390 

391 

$1, 090,  937, 500 

61.883 

2,776 

1,261 

8,822 


2,392 

79  199 

$16, 991 ! 000 


Marine  inspection  and  allied  safety  measures 

Through  December  30,  1960,  2,218,487  boats  had  been  numbered  by 
40  States  administering  motorboat  numbering  systems  approved  by 
the  Coast  Guard.  An  additional  231,997  were  numbered  by  the 
Coast  Guard  itself  for  those  States  not  having  approved  systems. 

During  the  calendar  year  1960,  reportable  accidents  involving 
3,785  pleasure  craft  resulted  in  819  fatalities,  929  injuries,  and  property 
damage  estimated  at  $3,192,100.  Details  on  the  Coast  Guard  pro- 
gram to  promote  marine  safety  for  pleasure  boating  were  published  in 
a  statistical  report  entitled  Recreatioval  Boating  in  the  United  States, 
released  on  May  1,  1961. 

Since  June  1,  1958,  some  4,350  small  passenger  vessels  have  been 
covered  by  the  inspection  and  certification  provisions  of  the  act  of 
May  10,  1956  (46  U.S.C.  390  a-g). 

There  were  3,700  marine  casualties  reported  and  investigated,  7 
of  which  were  considered  major  and  were  investigated  by  marine 
boards  of  investigation.  The  inquiries  of  these  boards  disclosed  that 
there  were  156  fatalities  from  vessel  casualties,  167  from  personal 
accidents,  and  229  from  miscellaneous  causes.  The  two  most  serious 
vessel  mishaps  are  described  in  an  earlier  part  of  the  report  as  search 
and  rescue  operations. 

A  digest  of  certain  marine  inspection  acti\nties  for  the  fiscal  year 
follows. 


Inspection  activitias 


Number  of 

vessels  or 

actions 


Gross  tonnage 


Inspections  for  certification,  U.S.  and  foreign 

Drydockings 

Reinspections 

Miscellaneous  inspections 

Factory  inspections 

Merchant  vessel  plans  reviewed 

Violations  of  navigation  and  vessel  inspection  laws 


1  5, 433 

5,810 

6,204 

22, 801 

607, 245 

32, 300 

2  11,412 


11, 301, 814 

13, 654, 872 
8, 201, 551 


1  Includes  591  Initial  inspections  to  obtain  first  certificates. 
SAs  of  April  30,  1961. 


216   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  Merchant  Marine  Council  held  seven  regular  meetings  and 
one  public  hearing  during  the  year.  As  a  result  of  their  deliberations, 
numerous  amendments  to  merchant  marine  safety  regulations  were 
promulgated. 

In  the  interest  of  promoting  marine  safety  the  Coast  Guard  par- 
ticipated in  numerous  meetings  and  conferences  throughout  the  year, 
one  of  which  was  the  National  Safety  Council's  Exposition  in  Chicago, 
111.  The  Coast  Guard  also  established  a  coordinating  panel  to  assist 
and  advise  the  Commandant  concerning  rules  of  the  road.  A  con- 
ference of  marine  inspection  officers  assigned  to  Coast  Guard  district 
offices  was  held  to  promote  greater  uniformity  in  the  administration 
of  merchant  marine  safety  functions.  One  million  copies  of  the 
pamphlet  Pleasure  Craft,  containing  useful  information  for  motorboat 
owners,  were  distributed  to  the  public  during  the  year.  The  Recrea- 
tional Boating  Guide,  a  publication  written  to  assist  the  novice  boat- 
man, has  also  had  mde  distribution.  For  the  fourth  consecutive 
year  the  Coast  Guard  received  the  National  Safety  Council's  Award 
of  Merit  for  the  monthly  magazine  Proceedings  of  the  Merchant 
Marine  Council,  a  publication  intended  to  increase  interest  in  marine 
safety. 

The  Coast  Guard  recently  established  a  special  staff  to  devote  full 
time  to  activities  involving  international  maritime  safety.  A  prin- 
cipal function  of  this  staff  will  be  to  work  closely  with  the  Inter- 
governmental Maritime  Consultative  Organization. 

Merchant  marine  personnel. — Dm^ing  the  fiscal  year,  63,522  docu- 
ments were  issued  to  merchant  marine  personnel,  and  Coast  Guard 
shipping  commissioners  supervised  the  execution  of  7,997  sets  of 
shipping  articles  involving  522,429  individual  transactions  relating  to 
the  shipment  and  discharge  of  seamen. 

Merchant  marine  investigating  sections  in  major  U.S.  ports  and 
merchant  marine  details  in  foreign  ports  investigated  13,183  cases 
involving  negligence,  incompetence,  and  misconduct.  Charges  were 
preferred  and  hearings  conducted  before  civilian  examiners  in  1,053 
of  these  cases.  Security  checks  were  made  of  16,540  persons  desiring 
employment  on  merchant  vessels. 

Law  enforcement 

To  provide  law  enforcement  and  educational  facilities  for  remote 
areas,  20  mobile  boarding  units  were  established  in  fiscal  1961.  The 
units  travel  from  one  water  area  to  another  in  order  to  examine  boats 
for  compliance  with  Federal  boating  laws  and  to  conduct  courses  for 
the  public. 

The  following  statistics  reflect  the  volume  of  enforcement  work  by 
the  Coast  Guard  during  the  fiscal  year. 

Vessels  boarded 152,  441 

Waterfront  facilities  inspected 24,  254 

Reported  violations  of: 

Motorboat  Act 25,  125 

Port  security  regulations 714 

Oil  Pollution  Act 462 

Other  laws 498 


ADMINISTRATIVE    REPORTS 


217 


Explosives: 

Loading  permits  issued 801 

Loadings  supervised 701 

Tons  covered  by  issued  permits 116,  601 

Other  hazardous  cargoes  inspected 7,  465 

Anchorage  violations 23 

Cooperation  with  other  Federal  agencies 

The  Coast  Guard  performed  services  for  other  Federal  agencies  as 
follows: 

Alcohol  Tax  Unit,  Treasury  (aircraft  days) 27 

Coast  and  Geodetic  Survey  (aerial  surveys  days) 138 

Fish  and  Wildhf e  (censuses  taken) 220 

Weather  Bureau: 

Reports  furnished 84,  490 

Warnings  disseminated 19,  299 

Aids  to  navigation 

On  June  30,  1961,  there  were  40,833  aids  to  navigation  maintained 
in  the  navigable  waters  of  the  United  States,  its  Territories  and  pos- 
sessions, the  Trust  Territory  of  the  Pacific  Islands,  and  at  overseas 
bases.  A  summary  of  those  maintained  at  the  close  of  each  of  the 
last  two  fiscal  years  follows. 


Navigation  aids 


Loran  transmitters 

Radiobeacons 

Fog  signals  (except  sound  buoys) 

Lights  (including  lightships) 

Daybeacons 

Buoys: 

Lighted  (including  sound)... 

Unlighted  sound 

Unlighted  metal. 

River  type 

Spar 

Total 


40,  833 


1  Includes  three  experimental  loran-B  stations  and  three  experimental  loran-C  stations. 
'  Includes  three  experimental  loran-C  stations. 


Ocean  stations 

The  Coast  Guard  continued  to  maintain  four  ocean  stations  in  the 
North  Atlantic  and  two  in  the  North  Pacific  during  the  fiscal  year. 
These  ships,  during  their  cruises  of  approximately  494,431  miles, 
provided  meteorological,  navigational,  and  communication  services 
for  air  and  marine  commerce,  and  collected  various  scientific  data. 

International  ice  patrol 

The  international  ice  patrol,  operating  between  February  20  and 
June  27,  1961,  employed  reconnaissance  aircraft,  radio  station 
facilities,  and  an  oceanographic  vessel.  The  iceberg  distribution  was 
found  to  be  relatively  light. 


218    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Bering  Sea  patrol 

Between  May  22  and  September  30,  1960,  the  U.S.C.G.C.  Storis 
and  U.S.C.G.C.  Northwind  traveled  17,464  miles  in  conducting  the 
Bering  Sea  patrol.  This  patrol  is  concerned  principally  with  law 
enforcement,  search  and  rescue,  aids  to  navigation,  logistics,  and  the 
fm'nishing  of  medical  and  dental  treatment  to  Alaskan  natives. 

Coast  Guard  intelligence 

Dm'ing  the  year,  2,765  full  or  limited  investigations  were  made, 
involving  security,  criminal  law  enforcement,  and  complaints.  In 
addition  the  following  investigations  were  made  for  secm^ity  and 
screening  purposes:  11,553  military  national  agency  checks,  19,668 
merchant  marine  documents  and  licenses,  and  14,738  port  security 
cards. 

Facilities,  equipment,  construction,  and  development 

Floating  units. — At  the  close  of  fiscal  1961,  the  Coast  Guard  had  in 
active  commission  179  cutters,  75  patrol  boats,  28  lightships,  38 
harbor  tugs,  and  12  buoy  boats.  The  patrol  boat  fleet  included  17 
newly  constructed  82-foot  steel  vessels.  Two  pusher-barge  (combina- 
tion type)  buoy  tenders  were  also  built  as  replacements  for  overage 
and  obsolete  ships.  Fixed  structures  are  being  built  to  replace  two 
lightships  that  have  had  over  50  years  of  active  service.  Coast  Guard 
floating  units  cruised  a  total  of  2,925,443  miles  during  fiscal  1961. 

Shore  establishments. — A  modernization  of  the  standard  30-foot 
utility  boat  has  resulted  in  a  30  percent  increase  in  speed,  and  con- 
struction of  a  prototype  44-foot  motor  lifeboat  was  begun.  On  a  trial 
basis  a  houseboat  is  being  used  as  a  seasonal  search  and  rescue  facility 
on  the  Great  Lakes.  Six  light  stations  were  converted  from  manned  to 
automatic,  unmanned  operation  and  four  small  light  attendant  sta- 
tions were  consolidated.  Seven  port  security  units  were  disestablished 
during  the  year  as  the  result  of  a  change  in  emphasis. 

AviaMon  and  aircraft. — ^The  Coast  Guard  operated  a  total  of  133 
aircraft,  including  37  helicopters,  during  the  fiscal  year.  In  exchange 
for  an  equal  number  of  type  SA-16A  aircraft  11  P5M  seaplanes  were 
transferred  to  the  Department  of  Defense,  and  two  SC-130B  planes 
were  acquhed  as  replacements  for  R5D  ahcraft.  Additionally, 
arrangements  were  made  with  the  Navy  to  borrow  six  II04S  heli- 
copters to  relieve  a  Coast  Guard  shortage  pending  new  procm-ement. 
Coast  Guard  aircraft  flew  27,376  sorties  during  the  fiscal  year,  accumu- 
lating a  total  of  104,607  operating  hours. 

Communications. — To  provide  for  more  eft'ective  coordination  of 
distress  cases,  particularly  those  involving  aircraft,  private  line  tele- 
phone systems  have  been  leased  in  two  additional  districts  to  connect 
major  Coast  Guard,  Air  Force,  and  Navy  commands  having  important 
search  and  rescue  capabilities. 

Engineering  developments 

Aeronautical  engineering.- — Procurement  of  type  HUS-lG  heli- 
copters has  been  terminated  because  of  various  deficiencies.  Two  of 
these  models  were  lost  in  crashes  caused  by  unexplained  power  failures. 


ADMINISTRATIVE    REPORTS  219 

Further  helicopter  procurement  will  await  careful  evaluation  of  models 
now  available.  Eleven  SA-16  twin  engine  amphibious  aircraft 
obtained  from  the  Air  Force  will  be  converted  to  type  UF-2G,  the 
standard  Coast  Guard  search  and  rescue  plane,  which  can  be  operated 
much  more  economically  than  the  P5M  aircraft  which  it  will  replace. 

Civil  engineering. — Major  projects  started  in  the  fiscal  year  included 
the  construction  of  two  offshore  light  stations  to  replace  lightships  at 
Buzzards  Bay,  Mass.,  and  Brenton  Reef,  R.I.,  and  the  erection  of  a 
modern  lighthouse  as  a  replacement  for  the  one  located  at  Charleston, 
S.C. 

Two  new  chains  of  overseas  loran  stations,  consisting  of  six  trans- 
mitters and  two  monitors,  were  completed  and  additions  were  made 
to  existing  chains. 

Electronics  engineering.— A.  new  device  which  converts  radar  picture 
coordinates  to  television  picture  coordinates  has  undergone  a  successful 
engineering  feasibility  test.  An  operational  evaluation  of  this  device 
as  an  aid  to  navigation  is  scheduled  for  fiscal  year  1962. 

Naval  engineering. — Sixteen  obsolescent,  wooden  hulled  83-foot 
patrol  boats  were  replaced  with  diesel-powered,  steel-hulled  82-foot 
boats.  A  210-foot  cutter  has  been  designed  to  replace  aging  125-foot 
and  165-foot  vessels.  The  cutters  of  the  new  class,  the  construction 
of  which  will  start  in  the  next  fiscal  year,  will  be  powered  by  diesel- 
gas  tm'bine  plants  and  will  have  helicopter  carrying  capability. 
Laminated  fiberglass  is  being  used  in  the  construction  of  thirty  new 
30-foot  and  seven  40-foot  utility  boats.  The  construction  of  six 
additional  pusher-barge  combinations  has  been  authorized  for  aids  to 
navigation  work,  and  six  65-foot  steel  harbor  tugs  are  to  be  built  to 
replace  obsolescent,  wooden  hulled  tugs  now  in  use. 

Testing  and  development.— An  evaluation  is  being  made  of  a  method 
for  pm'ifying  sea  water.  Propane-fueled,  thermoelectric  power  sources 
for  buoys  are  under  study,  and  two  isotopic-fueled  thermoelectric 
power  sources  are  being  manufactured  for  the  Coast  Guard  by  the 
Atomic  Energy  Commission.  During  the  fiscal  year  progress  was 
also  made  in  the  study  of  corrosion  protection  systems  for  the  hulls 
of  vessels. 

International  Lighthouse  Conference. — The  Coast  Guard  was  host  to 
the  Sixth  International  Technical  Conference  on  Lighthouses  and 
Other  Aids  to  Navigation,  held  in  Washington,  D.C.,  in  September 
1960.     Two  hundred  representatives  from  36  countries  attended. 

Coast  Guard  Reserve 

An  extensive  training  program  of  two-weeks  active  duty  was  carried 
out  during  the  fiscal  year  for  some  11,680  reservists,  and  an  estimated 
60  officers  and  2,540  enlisted  men  entered  active  duty  for  six-months' 
training. 

Eight  new  organized  Reserve  units  were  commissioned,  which 
brought  the  total  units  to  228.  Some  14,200  officers  and  enlisted 
men  are  attached  to  these  units  and  participate  in  the  annual  48- 
drill  schedule. 

614359—62 ^15 


220        1961    REPORT    OF    THE    SECRETARY    OF   THE    TREASURY 


Personnel 


The  following  table  enumerates  the  Coast  Guard  personnel  as  of 
June  30,  1960  and  1961. 


Personnel 

1960 

1961 

Number 

Military  personnel: 

Commissioned  officers 

3,011 

676 

333 

405 

26, 191 

3,061 
812 

Chief  warrant  officers . 

Warrant  officers 

205 

Cadets ._. . 

385 

Enlisted  men . 

27, 100 

Total 

30, 616 

31  563 

Civilian  personnel: 

Salaried  (General  Service) . 

2,379 

2,187 

224 

2  477 

Wageboard 

2,219 
220 

Lamplighters .  .         _  _ 

Total  (exclusive  of  vacancies) 

4,790 

4,916 

Ready  reservists: 

Officers 

3,577 
27, 907 

3,650 
27,399 

Enlisted  men 

Total 

31,484 

31, 049 

The  following  table  shows  the  changes  in  the  numbers  of  officers 
on  active  duty  as  of  June  30,  1960  and  1961.  The  net  gain  of  47 
was  sufficient  to  meet  the  increased  commitments  at  the  beginning 
of  fiscal  1962. 


Officers 

1960 

1961 

Number 

Additions  of  commissioned  officers: 

Coast  Guard  Academy  graduates 

137 
172 
12 
10 

119 

Officer  Candidate  School  graduates 

204 

Reserve  officers  called  to  active  duty 

17 

Former  merchant  marine  officers  appointed 

5 

Total 

331 

345 

Losses  of  commissioned  officers: 

Regular  ' .. 

121 
112 

88 

Reserve  (on  completion  of  obligated  service) -  .      . 

210 

Total 

233 

298 

Net  gain 

98 

47 

1  Through  retirements,  resignations,  revocations,  and  deaths. 

Recruiting  and  training. — Fifty-five  main  recruiting  stations  and 
approximately  47  substations  were  manned  by  249  recruiters.  Of 
the  19,885  applicants  for  enlistment  in  the  regular  Coast  Guard, 
6,102  were  enlisted.  The  Reserve  received  6,204  applications  and 
enlisted  3,351.  The  Receiving  Center,  Cape  May,  N.J.,  trained 
4,554  recruits  and  the  Receiving  Center,  Alameda,  Calif.,  an  additional 
1,685.  _ 

Training  for  foreign  visitors. — Approximately  179  visitors  from  33 
foreign  countries,  under  the  sponsorship  of  other  Government  agen- 
cies, were  extended  the  use  of  Coast  Guard  facilities  for  training  in 
aids  to  navigation,  loran,  search  and  rescue  procedures,  merchant 


ADMINISTRATIVE    REPORTS 


221 


marine  safety,  vessel  inspection,  port  security,  law  enforcement,  and 
aircraft,  etc. 

Coast  Guard  education  program. — The  education  and  training 
programs  participated  in  and  sponsored  by  the  Service  are  summarized 
for  1960  and  1961  as  follows: 


Education  and  training  programs 


Coast  Guard  Academy: 

Applications 

Applications  approved 

Appointments 

Cadets 

Graduates  (bachelor  of  science  degrees) .-. 

Officer  Candidate  School  graduates. 

Enlisted  men  graduated  from  basic  petty  officer  schools: 

Coast  Guard 

Navy  and  other 

Total  graduates  of  basic  petty  officer  schools 

Advanced  schools  (Navy  and  other) 

Specialized  courses  (Service  and  civilian  schools) 

Coast  Guard  Institute  courses  completed 

United  States  Armed  Forces  Institute  courses  completed 

Naval  correspondence  schools  courses  completed 

other  training: 

Postgraduate  (officers) 

Entered  flight  (officers) 

Hehcopter  pilot,  8-week  (aviators) 

Training  (C-130B  aircraft) 

Short  term  specialized  courses 

Off  duty  courses  at  civilian  schools  (officers) 


Public  Health  Service  support. — On  June  30,  1961,  there  were  92 
Public  Health  Service  personnel  on  duty  with  the  Coast  Guard  serving 
at  22  shore  stations  and  aboard  ships  assigned  to  ocean  stations,  the 
Bering  Sea  patrol,  and  arctic  and  antarctic  operations. 

Personnel  safety  program.- — The  in  jury -producing  accident  rate  in- 
creased during  1960  for  both  military  and  civilian  Coast  Guard  per- 
sonnel. In  spite  of  this  increase  the  accident  ratio  over  the  past 
several  years  has  had  a  downward  trend. 

Fiscal  and  supply  management 

Uniform  supply  procedures  and  organization  have  been  adopted 
throughout  the  Service  during  the  fiscal  year.  This  uniformity  has 
not  only  resulted  in  savings,  but  also  has  simplified  the  task  of  training 
supply  personnel.  Through  arrangements  with  the  General  Services 
Administration  and  the  Department  of  Defense,  the  Coast  Guard  now 
has  direct  access  to  the  excess  and  long  supply  stocks  of  the  military 
services.  This  is  expected  to  result  in  more  effective  use  of  surplus 
material,  since  the  Coast  Guard  will  be  able  to  obtain  excess  stocks 
several  months  earlier  than  in  previous  years.  The  Coast  Guard  has 
also  arranged  to  dispose  of  its  excess  materials  through  Department 
of  Defense  consolidated  sales  activities,  thus  enabling  faster  and  more 
economical  disposal  through  established  military  sales  outlets. 

Coast  Guard  Auxiliary 

The  primary  purpose  of  this  voluntary,  nonmilitary  organization 
is  the  promotion  of  boating  safety.  Functioning  in  some  573  com- 
munities, the  Auxiliary  conducts  public  instruction  courses  in  basic 


222   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

seamanship  and  safe  boat  handling,  which  had  an  enrollment  of 
108,041  dm-ing  the  fiscal  year.  The  Auxiliary  also  made  113,962 
courtesy  examinations  of  motorboats,  assisted  the  Coast  Guard  in 
patrolling  842  regattas,  and  cooperated  in  answering  3,150  calls  for 
assistance.  On  June  30,  1961,  the  organization  had  20,747  members 
and  13,391  facilities  consisting  of  boats,  aircraft,  and  radio  stations  in 
713  flotillas. 
Funds  available,  obligations,  and  balances 

The  following  table  shows  the  amount  of  funds  available  for  the 
Coast  Guard  during  the  fiscal  year  1961,  and  the  amounts  of  obliga- 
tions and  unobligated  balances. 


Funds 
available  i 

Net  total 
obligations 

Unobligated 
balances  2 

Appropriated  funds: 

$205, 000, 000 
16,  000, 000 
30, 000, 000 
34,  661, 002 

$204,  454,  768 
15, 919,  547 
29, 980,  505 
23,  886,  565 

$545,  232 

80, 453 

19,  495 

Acquisition,  construction,  and  improvements -- 

10, 774, 437 

285,  661,  002 

274,  241, 385 

11,419,617 

Reimbursements: 

30,  973,  244 
33,  753,  434 

30,  973,  244 
18, 666, 335 

Acquisition,  construction,  and  Improvements 

15, 087, 099 

64,  726,  678 

49,  639,  579 

15, 087, 099 

Trust  fund,  U.S.  Coast  Guard  gift  fund 

17,  840 

6,602 

11,238 

350, 405,  520 

323, 887,  566 

26,  517, 954 

1  Funds  available  include  unobligated  balances  brought  forward  from  prior  year  appropriations  as  follows: 
Acquisition,  construction,  and  improvements: 

Appropriated  funds $4,  661,  002 

Reimbursements 12,290,349 

U.S.  Coast  Guard  gift  fund 7,683 

2  Unobligated  balance  of  $25,861,536  under  the  acquisition,  construction,  and  improvement  appropriation 
remains  available  for  obUgation  in  the  fiscal  year  1962.  These  funds  are  programmed  for  obligation  in  fiscal 
1962  for  the  following  general  purposes: 

Coast  Guard    Department  of  Defense 
projects  projects 
For  projects  deferred  in  fiscal  1961  to  be  subsequently  accom- 
plished             $4,661,100  $9,805,500 

For  completion  of  projects  started  in  fiscal  1961 6, 113,  337  5,  281,  599 


Total - 


10,  774,  437 


15,087,099 


Management  improvement 

Management  improvement  in  fiscal  1961  again  proved  its  worth  as 
a  means  of  reducing  costs  and  furthering  efficiency  in  the  Coast 
Guard.  From  this  program  total  savings  for  the  year  were  estimated 
at  $3,234,000,  an  increase  of  60  percent  over  the  previous  12-month 
period.  Of  this  total,  some  $2,200,000  is  credited  to  the  military  and 
civilian  incentive  awards  programs,  which  are  closely  linked  to  the 
management  improvement  effort. 

Numerous  management  reviews  were  undertaken  during  fiscal  1961, 
including  studies  of  various  functions  in  the  Office  of  Personnel.  A 
major  management  survey  is  scheduled  to  get  underway  shorth'  after 
the  start  of  fiscal  1962.  This  will  involve  an  extensive  study  of  the 
Coast  Guard's  systems  of  information  on  financial  management. 

The  benefits  realized  from  management  improvement  have  enabled 
the  Service  to  make  more  effective  use  of  its  manpower,  facilities,  and 
equipment. 


ADMINISTRATIVE    REPORTS  223 

United  States  Savings  Bonds  Division 

Fiscal  1961  marked  the  twenty-sixth  year  of  continuous  sale  of  U.S. 
savings  bonds,  a  nonmarketable  security  sold  in  denominations  as  low 
as  $25.  Series  E  and  Series  H  are  the  only  savings  bonds  currently 
being  sold.  Series  E  bonds,  which  marked  their  twentieth  anni- 
versary during  the  fiscal  year,  have  been  on  sale  since  May  1941, 
while  the  sale  of  Series  H  bonds  began  in  June  1952. 

The  primary  responsibility  of  the  U.S.  Savings  Bonds  Division  is  to 
promote  the  sale  and  retention  of  U.S.  savings  bonds  and  the  sale  of 
savings  stamps.  Comparatively  small  in  staff,  the  Division  concen- 
trates its  activities  on  planning  and  directing  the  sales  promotional 
efforts  of  a  large  corps  of  volunteers.  These  volunteers  comprise 
thousands  of  public-spirited  men  and  women  who  serve  as  a  sales  pro- 
motional force  and  as  issuing  agents.  Over  the  years  they  have  been 
primarily  responsible  for  the  success  of  the  savings  bond  program. 

Thousands  of  banks  and  other  financial  institutions  sell  savings 
bonds  without  compensation.  As  a  public  service,  private  industry 
finances  advertising  time  and  space  costs  of  the  program,  which  amount 
to  an  annual  cost  of  more  than  $50  million.  The  promotional  costs 
of  payroll  savings  campaigns  in  various  businesses  and  industries,  as 
well  as  the  operational  costs  of  the  plans,  are  likewise  borne  by  the 
businessmen  of  the  Nation.  Thanks  to  this  nationwide  volunteer 
support  the  promotional  cost  of  the  savings  bond  program  to  the 
Government  is  only  slightly  over  one  dollar  for  every  one  thousand 
dollars  of  E  and  H  bonds  sold. 

For  the  average  investor  who  desu-es  a  riskless  investment,  savings 
bonds  have  an  advantage  over  marketable  securities,  since  they  are 
free  from  market  fluctuations  in  price.  After  short  initial  holding 
periods,  an  investor  may  redeem  his  bonds  at  prescribed  redemption 
values.  This  contract  permitting  him  to  obtain  in  cash  the  amount 
of  his  original  investment  and  any  interest  that  might  have  accrued, 
not  only  at  maturity  date  but  also  throughout  the  life  of  the  security, 
is  an  important  and  valuable  feature  for  man}^  individual  savers. 
In  this  respect  the  savings  bond  is  similar  to  a  private  savings 
account.  The  purchaser  of  a  savings  bond,  however,  has  the  assur- 
ance that  the  investment  return  is  guaranteed  for  the  full  term  of 
the  bond,  whereas  the  savings  account  interest  or  dividend  rate  may 
be  revised  at  the  option  of  the  savings  institution.  The  graduated 
interest  return  on  savings  bonds,  depending  upon  length  of  retention, 
was  designed  to  encourage  longer-term  holdings.  All  E  and  H 
bonds  dated  June  1,  1959,  and  thereafter  pay  3%  percent  per  annum 
compounded  semiannually  if  held  to  maturit}''.  The  initial  maturity 
term  for  the  E  bond  is  7  years,  9  months,  for  the  H  bond,  10  3'ears. 

Series  E  bonds  also  are  attractive  to  many  investors  in  that  payment 
of  income  tax  on  interest  accruals  may  be  postponed  until  the  bonds 
are  redeemed  or  reach  final  matm'ity,  whichever  is  earlier.  With  the 
10-year  matmity  extension  which  has  been  granted  to  all  E  bonds,  and 
a  second  10-year  extension  given  to  bonds  bought  between  May  1941 
and  May  1949,  many  holders  can  postpone  redemptions  until  a  time 
of  life  when  they  may  be  in  a  lower  tax  bracket,  or  not  subject  to  any 
tax. 


224    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

In  addition,  since  January  1,  1960,  holders  of  all  outstanding  Series 
E  and  J  bonds  and  certain  Series  F  bonds  have  been  permitted  to 
exchange  them  for  current  income  Series  H  bonds.  Payment  of  taxes 
on  the  interest  increments  on  the  old  bonds  may  be  deferred  until  the 
H  bonds  issued  in  exchange  are  finally  redeemed,  or  until  the  taxable 
year  of  final  maturity,  whichever  is  earlier. 

Another  protective  featm-e  of  savings  bonds  is  that  they  are  issued 
in  registered  form  only  and  are  replaced  by  the  Treasm-y  in  the  event 
of  destruction  or  loss. 

Since  its  inception  the  savings  bond  program  has  proved  to  be  a  vital 
ins  trument  in  promoting  nationwide  thrift  and  regular  saving  on  the 
part  of  millions  of  Americans.  The  payi^oll  savings  plan  has  been 
particularly  effective  in  developing  the  thrift  habit  among  the  Nation's 
wage  earners  and  in  channeling  systematic  savings  into  Series  E  bonds, 
the  most  popular  Government  security.  More  than  eight  million 
Americans  at  work  in  industry  and  Government  participate  in  pay- 
roll savings  programs.  They  account  for  more  than  40  percent  of 
current  E  and  H  bond  purchases. 

The  best  assm'ance  of  sound  Government  finance  is  widespread 
ownership  of  the  pubhc  debt  by  genuine  savers,  outside  the  commercial 
banking  system.  The  sale  of  E  and  H  bonds  to  persons  who  buy  them 
with  money  saved  from  earnings  is  the  most  successful  way  the  Treas- 
ury has  found  during  the  postwar  period  to  increase  the  amount  of  the 
debt  in  the  hands  of  long-term  savers.  Such  sales  contribute  to  the 
maintenance  of  price  stability  and  a  sound  dollar. 

At  the  close  of  fiscal  1961,  Series  E  and  H  bonds  outstanding  reached 
more  than  $43.8  billion,  a  $13.5  billion  increase  in  this  program  over 
the  amount  of  E  bonds  outstanding  at  the  end  of  calendar  1946. 
They  now  represent  15  percent  of  the  total  public  debt  outstanding 
as  compared  with  12  percent  in  December  1946.  Of  the  $43.8  billion 
outstanding  on  June  30,  1961,  $17.8  billion,  or  more  than  40  percent, 
are  E  bonds  which  have  gone  beyond  their  first  maturity  of  ten 
years  from  issue  date. 

The  E  and  H  bond  sales  and  redemption  picture  showed  significant 
improvement  in  fiscal  1961.  The  cash  value  of  E  and  H  bonds 
outstanding,  including  the  automatic  accrual  of  interest  on  Series  E 
bonds,  gained  $1.1  billion  during  the  year,  the  largest  growth  in  any 
one-year  period  since  1956.  Total  cash  sales  amounted  to  $4.5  billion 
and  were  4  percent  above  those  in  fiscal  1960.  Cash  sales  were  2 
percent  higher  in  the  first  half  of  fiscal  1961  (July-December  1960) 
and  5  percent  more  in  the  second  half  than  sales  in  the  corresponding 
periods  a  year  earlier.  Moreover,  from  January-June  1961  the  volume 
of  E  and  H  bonds  outstanding  increased  $668  million,  which  was 
more  than  four  times  the  increase  during  the  same  period  in  fiscal 
1960.  Gross  redemptions  of  the  two  series  of  $4.6  billion  during 
fiscal  1961  represented  the  lowest  amount  in  six  years  and  were  16 
percent  below  redemptions  in  fiscal  1960. 

The  sale  of  savings  stamps  also  continues  to  be  an  important  part 
of  the  Treasury's  efforts  to  promote  thi'ift  and  channel  individuals' 
savings  into  Government  bonds.  Through  their  purchase  students 
and  other  savers  are  able  to  buy  savings  bonds  on  the  installment 
plan.     The  sale  of  savings  stamps  in  fiscal  1961  amounted  to  $18.4 


ADMINISTRATIVE    REPORTS  225 

million,   5   percent   below   the   preceding   year.     The   sales   volume 
represented  purchases  of  107  million  stamps. 

Management  improvement 

Headed  by  a  National  Director  and  an  Assistant  National  Director, 
the  U.S.  Savings  Bonds  Division  is  composed  of  three  principal 
branches:  Sales,  Planning,  and  Advertising  and  Promotion.  The 
chiefs  of  these  three  branches,  together  with  the  National  Director  and 
Assistant  National  Director,  comprise  the  Division's  management 
committee  whose  main  purpose  is  the  improvement  of  services  by 
the  Division. 

Constant  attention  is  given  to  improvement  in  operations,  organi- 
zation, and  the  use  and  distribution  of  manpower.  During  the  year 
5  positions  were  abolished  with  savings  of  $33,200  annually. 

Stricter  controls  over  the  distribution  of  electrotype  plates,  which 
commenced  during  1960,  have  been  expanded  through  a  survey  of 
industrial  publications  to  determine  whether  some  could  use  proofs 
instead  of  electrotype  plates  to  reproduce  savings  bonds  advertise- 
ments in  their  publications.  This  resulted  in  a  further  saving  of 
about  $3,500  a  year. 

The  Division  was  able  to  expand  its  promotional  exhibits  without 
cost  through  the  cooperation  of  private  industry  and  of  three  other 
Government  agencies.  Of  particular  note  was  the  acquisition  of  two 
exhibits  illustrating  the  Government's  satellite  program,  presented 
by  a  private  corporation  for  use  in  savings  bonds  promotion. 

Consolidation  and  relocation  of  field  offices  in  the  State  of  New 
York  and  the  District  of  Columbia,  instigated  by  the  Division, 
resulted  in  a  reduction  of  2,259  square  feet  of  rented  space,  with 
consequent  savings  to  the  Government. 

The  Sales  Branch  developed  and  adopted  a  uniform  training  pro- 
gram for  newly  appointed  field  personnel  and  an  intensive  refresher 
course  in  the  promotion  of  the  payroll  sa^dngs  plan  for  selected  person- 
nel already  on  the  rolls.  In  addition  the  new  semiannual  reports 
required  of  all  field  representatives  have  resulted  in  a  marked  improve- 
ment in  the  number  and  quality  of  sales  calls  made  by  the  field  force. 

United  States  Secret  Service 

The  major  functions  of  the  United  States  Secret  Service  are  the 
protection  of  the  President  of  the  United  States  and  members  of  his 
immediate  family,  the  President-elect,  and  the  Vice  President  at  his 
request;  the  detection  and  arrest  of  persons  committing  any  offenses 
against  the  laws  of  the  United  States  relating  to  obligations  and 
securities  of  the  United  States  and  of  foreign  governments;  and  the 
detection  and  arrest  of  persons  violating  certain  laws  relating  to  the 
Federal  Deposit  Insurance  Corporation,  Federal  land  banks,  joint- 
stock  land  banks,  and  national  farm  loan  associations.  These  and 
other  duties  of  the  Secret  Service  are  defined  in  section  3056  of  Title 
18,  United  States  Code. 

Management  improvement 

A  system  of  classification  and  coding  of  hand wii ting  was  developed 
and  placed  in  use  in  the  Forgery  Section  of  the  Secret  Service  head- 
quarters as  an  aid  in  associating  forgeries  of  common  authorship  and 


226    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

identifying  multiple  and  interstate  forgers.  With  the  cooperation  of 
the  Treasury  Department's  Office  of  Alanagement  and  Organization 
a  study  is  underway  to  determine  the  feasibility  of  adapting  the  sys- 
tem to  automatic  data  processing,  and  trial  runs  have  been  made  on 
equipment  made  available  by  other  Treasury  activities.  These  tests 
give  promise  of  successful  adaptation  of  the  system  to  electronic 
equipment.  The  result  expected  from  this  program  is  faster  identifi- 
cation of  professional  interstate  forgers  and  saving  in  time  in  field 
investigations. 

Conferences  were  held  by  representatives  of  the  Secret  Service  and 
of  the  Post  Office  Department  with  the  objective  of  identifying  meas- 
ures which  could  be  taken  to  reduce  the  number  of  Treasury  checks 
stolen  from  the  maU  and  then  forged  and  cashed.  As  a  result  of  these 
conferences,  the  Post  Office  Department  has  inaugm-ated  procedures 
designed  to  reduce  the  incidence  of  check  thefts  from  the  mails. 

Several  steps  were  taken  with  a  view  to  eliminating  nonessential 
paperwork.  Multiple  copy  statistical  control  forms  relating  to  certain 
types  of  investigations  were  reduced  to  an  original  copy  only  and  a 
procedure  was  adopted  which  saves  time  in  the  compilation  of  statis- 
tics. In  addition,  a  statistical  report  for  each  field  district,  previously 
prepared  and  distributed  monthly,  is  now  prepared  c^uarterly.  The 
time  saved  allows  the  Statistical  Section  to  absorb,  without  additional 
personnel,  the  increased  workload  caused  by  the  rise  in  the  number 
of  investigations  being  handled  by  the  Secret  Service. 

A  revision  was  completed  of  the  manual,  "Production  oj  Currency 
and  Other  Obligations  oj  the  United  States."  This  manual  is  used  to 
familiarize  investigative  personnel  with  the  various  processes  involved 
in  the  manufacture  of  currency  and  coins.  Such  information  is  vital 
for  the  effective  performance  of  duties  relating  to  suppression  of 
counterfeiting.  The  revised  manual  gives  a  thorough  and  up-to-date 
account  of  methods  used. 

Presidential  protection 

During  the  year  the  Secret  Service  was  heavily  engaged  in  activities 
relating  to  Presidential  protection.  A  special  detail  of  special  agents 
was  assigned  to  guard  President-elect  Kennedy  immediately  following 
his  election  to  the  Presidency.  Following  the  inauguration,  the  re- 
sponsibility for  protecting  President  Kennedy  and  his  family  then  was 
shifted  to  the  regular  White  House  Detail  of  the  Secret  Service  and 
a  detail  of  agents  was  assigned  to  Vice  President  Johnson  when 
requested. 

In  addition  to  protection  provided  the  President  while  in  residence 
and  during  trips  Avithin  the  United  States,  special  agents  made  advance 
security  arrangements  and  protected  the  President  and  Vice  President 
on  trips  abroad.  These  included  trips  of  the  President  to  Canada, 
Paris,  Vienna,  and  London,  and  trips  of  the  Vice  President  to  Africa, 
Europe,  and  the  Far  East. 

Investigations  concerning  the  protection  of  the  President  increased 
from  573 "in  1960  to  870  in  1961,  a  rise  of  51.8  percent.  There  were 
65  such  cases  pending  at  the  close  of  the  year,  which  was  36  more 
than  at  the  end  of  fiscal  1960.  Arrests  resulting  from  investigation  of 
these  cases  increased  from  65  to  86,  or  by  32.3  percent. 


ADMINISTRATIVE    REPORTS  227 

One  of  these  investigations  was  the  so-called  "human  bomb"  case. 
On  December  15,  1960,  Richard  Paul  Pavlick  was  arrested  in  West 
Palm  Beach,  Fla.,  for  threatening  the  life  of  President-elect  Kenned}'. 
Pavlick  planned  to  make  himself  a  "liimian  bomb,"  get  as  close  to 
the  President-elect  as  he  could,  detonate  the  explosive,  and  destroy 
himself  along  with  any  others  who  might  be  in  the  vicinity.  When 
arrested,  seven  sticks  of  dynamite,  detonators,  wires,  and  related 
items  were  found  in  his  car.  In  a  search  of  his  living  quarters,  three 
additional  sticks  of  dynamite  were  found.  The  intended  scene  of 
this  carefully  planned  assassination  attempt  was  the  church  in  West 
Palm  Beach  attended  by  the  President-elect.  Pavlick  was  held  in 
$100,000  bond.  On  January  27,  1961,  he  was  ordered  committed 
to  the  Medical  Center  for  Federal  Prisoners. 

Enforcement  activities 

Counterfeiting  investigations  increased  58.9  percent  and  Secret 
Service  special  agents  seized  a  total  of  $2,179,146  in  counterfeit 
notes,  an  increase  of  400.8  percent  compared  with  seizures  in  1960. 
Of  the  amount  seized  in  1961,  $1,632,070  was  captured  before  it  could 
be  placed  in  circulation  and  $547,076  was  passed  on  merchants  and 
cashiers.  Representative  value  of  counterfeit  coins  seized  was 
$22,297,  an  increase  of  112.6  percent  over  1960.  Of  this  amount, 
$16,502  was  passed. 

In  1961  there  was  a  39.3  percent  rise  in  new  issues  of  counterfeit 
notes,  continuing  the  trend  in  1960,  in  which  year  there  was  an  in- 
crease of  25.6  percent  over  1959.  Arrests  for  violating  the  counter- 
feiting laws  totaled  595,  an  increase  of  44.4  percent  over  1960. 

The  following  are  representative  of  some  of  the  counterfeiting 
investigations  this  year: 

On  July  19,  1960,  the  manufacturer  of  counterfeit  $20  notes  was 
arrested  in  Youngstown,  Ohio.  His  arrest  followed  extensive  under- 
cover work  and  he  was  taken  into  custody  while  in  the  act  of  making 
plates  for  additional  counterfeit  notes.  The  first  of  the  counterfeit 
notes  appeared  June  11,  1960,  in  West  Virginia  and  circulation  of 
the  notes  spread  quickly  to  other  areas.  There  were  32  additional 
arrests  made  for  dealing  in  these  counterfeits.  On  September  15, 
1960,  the  manufacturer  was  sentenced  to  10  years. 

On  May  16,  1961,  nine  men  were  sentenced  in  Springfield,  Mo., 
for  the  manufacture  and  distribution  of  counterfeit  $20  ancl  $100 
notes.  The  leader  of  the  ring,  Loren  Baxter  Hamby,  was  sentenced 
to  20  years  imprisonment  and  the  others  received  sentences  ranging 
from  five  to  fifteen  years.  The  convictions  clunaxed  months  of 
investigation  and  undercover  work  by  Secret  Service  agents  and 
stamped  out  a  counterfeiting  operation  with  the  capacity  to  print 
one  million  dollars  in  currency  a  week.  The  members  of  this  gang 
had  expressed  fear  of  infiltration  by  an  undercover  agent  and  after 
their  arrests  were  stunned  by  the  disclosure  that  one  young  man, 
accepted  as  a  trusted  accomplice,  turned  out  to  be  a  Secret  Service 
agent.  In  addressing  the  jury  at  the  end  of  the  trial,  the  Federal 
District  Judge  commented  that  the  agent  was  "a  brave  man,  ex- 
ceedingly brave,  a  dedicated  public  servant.  He  has  demonstrated 
more  courage  than  I  ever  had." 


228   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


In  New  York  City  on  April  13,  1961,  two  men  were  arrested  for 
negotiation  of  $194,000  in  counterfeit  U.S.  Treasury  note  coupons  at 
a  Long  Island  bank.  A  third  man,  an  employee  of  the  bank,  was 
arrested  on  April  19,  in  Tampa,  Fla.  He  had  conspired  with  the 
other  two  to  negotiate  the  counterfeit  coupons  and  arranged  to 
facilitate  the  transaction.  The  defendants  in  this  case  were  con- 
victed on  June  30,  1961.  The  principal  has  been  sentenced  to  10 
years  and  his  two  codefendants  to  3  years  and  15  months,  respectively. 
One  of  them  was  also  identified  with  the  extensive  passing  of  counter- 
feit notes  in  the  East.1 

On  December  3,  1960,  three  men  were  arrested  in  Union  City,  N.  J., 
for  making  and  distributing  comiterfeit  $20  notes.  They  are  awaiting 
trial.  These  notes  first  appeared  in  circulation  in  New  York  City  on 
October  1,  1960.  By  tracing  purchases  of  the  type  of  paper  on  which 
the  notes  were  printed,  the  site  of  the  plant  was  located,  and  after 
a  period  of  surveillance,  a  raid  was  made  and  the  three  men  arrested. 
Paraphernalia  used  in  printing  these  notes  were  seized.  In  addition 
to  the  three  principals,  about  100  others  have  been  arrested  for  dis- 
tributing and  passing  these  $20  notes,  which  have  circulated  heavily 
along  the  East  Coast  from  Massachusetts  to  Florida. 

The  following  table  summarizes  seizures  of  counterfeit  money 
during  the  fiscal  years  1960  and  1961. 


Counterfeit  money  seized,  fiscal  years  1960  and  1961 

Notes  and  coins 

1960 

1961 

Percentage 
increase 

Counterfeit  and  altered  notes: 

$245,048.10 
190, 106.  00 

$547,076.50 
1,632,070.00 

123.3 

758.5 

Total                                        -  -    -- 

435, 154. 10 

9, 588.  73 
896. 96 

2, 179, 146. 60 

16, 501. 94 
5, 795.  20 

400.8 

Counterfeit  coins  seized: 

72.1 

546.1 

Total           -- 

10,485.69 

22, 297. 14 

112.6 

445, 639.  79 

2,201,443.64 

394.0 

During  the  fiscal  year  1961,  the  Secret  Service  received  36,221 
cases  involving  the  forgery  of  Government  checks,  a  decline  of  8 
percent  compared  with  1960.  In  the  final  quarter  of  the  year,  forgeries 
of  Government  checks  began  to  rise  sharply,  with  10,115  received 
compared  with  8,565  received  in  the  quarter  preceding.  Agents 
completed  investigation  of  34,846  check  forgery  cases.  There  had 
been  22,815  forged  check  cases  on  hand  at  the  beginning  of  the  year, 
and  at  its  close  there  was  a  backlog  of  24,190,  an  increase  of  6  percent. 
Forged  checks  investigated  had  a  representative  value  of  $3,333,307. 
There  were  2,967  arrests  for  forging  Government  checks,  a  decrease 
of  8.7  percent  compared  with  1960. 

An  interstate  multiple  check  forger  was  arrested  in  Chicago  on 
August  5,  1960.  He  was  identified  as  the  forger  of  70  Treasury  checks 
and,  when  arrested,  had  more  than  $16,000  in  cash  in  his  possession. 
He  had  been  released  from  prison  approximately  a  year  before,  after 
serving  five  years  on  forgery  charges.  He  was  sentenced  on  October  3, 
1960,  to  twelve  years. 


ADMINISTRATIVE    REPORTS  229 

On  October  5,  1960,  a  serviceman  stationed  at  Fort  Bragg,  N.C., 
stole  105  blank  Treasury  checks  from  the  Finance  Office.  He  fraud- 
ulently issued  and  cashed  22  of  the  checks  and  was  arrested  while 
attempting  to  cash  another  check.  Seventy-six  of  the  blank  checks 
were  recovered.    He  was  sentenced  on  May  26,  1961,  to  five  years. 

Between  August  1960  and  January  1961,  eleven  persons  were 
arrested  for  conspiracy  to  steal,  forge,  and  cash  U.S.  Treasurer's 
checks.  They  were  responsible  for  over  125  forged  checks  negotiated 
in  Ohio,  Kentucky,  California,  Mississippi,  Tennessee,  and  Florida. 
All  were  convicted  and  received  sentences  ranging  up  to  six  years 
imprisonment. 

Investigations  concerning  the  forgery  of  U.S.  savings  bonds  in- 
creased nearl}''  100  percent,  cases  received  in  fiscal  1961  totaling 
10,402  compared  with  5,218  for  the  previous  year.  At  the  close  of 
1961,  there  were  7,908  such  cases  pending,  an  increase  of  55  percent 
over  the  number  pending  a  year  earlier.  There  were  75  offenders 
arrested  for  bond  forgeries  compared  with  58  arrests  the  year  before. 

Investigations  by  the  Secret  Service  reveal  that  thousands  of  dollars 
in  U.S.  savings  bonds  are  being  stolen  in  burglaries  and  disposed  of 
through  fences  to  the  negotiators  of  the  bonds.  In  most  cases  the 
forgers  have  used  counterfeit  or  fraudulently  obtained  automobile 
drivers'  licenses  as  identification,  and,  as  a  further  subterfuge  to 
establish  a  rating  at  the  bank,  have  opened  small  savings  accounts. 
Through  the  cooperation  of  the  American  Bankers  Association  and 
State  bank  associations,  banks  throughout  the  country  have  been 
alerted  and  cautioned  to  observe  requirements  for  identification 
before  negotiating  bonds. 

In  Newark,  N.J.,  on  November  18,  1960,  thirteen  persons  responsible 
for  the  forgery  of  about  $250,000  in  savings  bonds  were  sentenced 
to  terms  in  prison  ranging  up  to  15  years. 

On  November  10,  1960,  also  in  Newark,  N.J.,  an  individual  was 
arrested  and  charged  with  conspiracy  to  forge  and  negotiate  U.S. 
savings  bonds.  When  arrested  at  the  airport,  he  had  46  bonds  in  his 
possession,  with  face  value  of  $15,000,  together  with  counterfeited 
drivers'  licenses  inade  out  in  the  names  of  the  owmers  of  the  registered 
bonds. 

In  Buffalo,  N.Y,,  on  January  9,  1961,  three  men  and  a  woman  were 
arrested  after  the  woman  had  attempted  to  negotiate  nineteen  $100 
savings  bonds  at  two  different  banks.  All  banks  in  the  area  were 
alerted  and  when  the  woman  made  another  attempt  to  negotiate  the 
bonds,  she  was  arrested  by  Secret  Service  agents.  Later  her  three 
accomplices  were  identified  and  arrested. 

On  Januar}^  25,  1961,  a  notorious  bond  forger  was  arrested  at 
Laredo,  Tex.,  when  an  agent  who  had  been  searching  for  him, 
recognized  him  in  a  hotel  coffee  shop.  He  had  cashed  $67,000  in 
stolen  bonds  and  had  seven  $1,000  bonds  in  his  possession.  He  has 
been  sentenced  to  10  years  in  prison. 

On  June  28,  1961,  two  men  were  arrested  at  Niagara  Falls,  N.Y., 
after  they  had  negotiated  $4,000  in  stolen  and  forged  savings  bonds. 
One  was  arrested  while  attempting  to  negotiate  $2,400  in  additional 
bonds.  The  other  attempted  to  escape  and  was  arrested  as  a  result 
of  a  road  block.  These  men  used  the  typical  procedure  for  negotiating 
bonds.     They  opened  a  small  savings  account  and  rented  a  safety 


230 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


deposit  box  and  for  identification  presented  a  counterfeit  automobile 
operator's  license  in  the  name  of  the  registered  owner  of  the  stolen 
bonds.  They  allegedly  obtained  the  bonds  through  underworld 
sources  acting  as  brokers  for  bonds  stolen  in  various  parts  of  the 
country. 

Cases  of  all  types  received  for  investigation  aggregated  61,538, 
an  increase  of  13.5  percent  over  the  previous  year.  At  the  beginning 
of  fiscal  1961  there  were  28,921  cases  pending  and  although  56,902 
cases  were  closed,  there  were  33,557  cases  pending  at  the  end  of  the 
year. 

Secret  Service  agents  arrested  a  total  of  3,806  offenders  in  1961 
compared  with  3,869  for  the  previous  year.  There  were  3,444  convic- 
tions, representing  99  percent  of  all  cases  prosecuted,  some  of  which 
had  been  pending  from  1960. 

The  following  tables  show  comparative  case  and  arrest  statistics 
for  the  fiscal  years  1960  and  1961. 

Criminal  and  noncriminal  cases  received,   closed,   and  pending,  fiscal  years  1960 

and  1961 


Cases 

1960 

1961 

Percentage 
increase,  or 
decrease  (— ) 

Received: 

573 

7,118 

39, 358 

5,218 

383 
1,575 

870 
11,308 
36, 221 
10, 402 

367 
2,370 

51.8 

58.9 

-8.0 

99.3 

-4.2 

50.5 

Total                  

54,225 

61, 538 

13.5 

Closed: 

Protective  research          ...  

580 

7,130 

41, 202 

3,750 

390 

1,767 

834 

11,004 

34, 846 

7,603 

392 

2,223 

43.8 

54.3 

-15.4 

102.7 

.5 

25.8 

Total    — - 

54, 819 

56, 902 

3.8 

Pending  end  of  fiscal  year: 

29 
651 
22, 815 
5,109 
126 
191 

65 
955 
24, 190 
7,908 
101 
338 

124.1 

46.7 

6.0 

54.8 

-19.8 

77.0 

Total                                   - 

28,921 

33, 557 

16.0 

Number  of  arrests  fiscal  years  1960  and  1961 

Offenses 

1960 

1961 

Percentage 
increase,  or 
decrease  (— ) 

412 

3,250 

58 

65 

84 

595 

2,967 

75 

86 

83 

44.4 

-8.7 

29.3 

32.3 

-1.2 

Total                         

3,869 

3,806 

-1.6 

EXHIBITS 


Public  Debt  Operations,  Calls  of  Guaranteed  Obligations,  Regulations, 

and  Legislation 

Treasury   Certificates  of  Indebtedness,   Treasury   Notes,  and  Treasury  Bonds 

Offered  and  Allotted 

Exhibit  1. — Treasury  certificates  of  indebtedness 

A  Treasury  circular  containing  a  representative  certificate  offering  during  the 
fiscal  year  1961  is  reproduced  in  this  exhibit.  The  circular  pertaining  to  the  other 
cash  offering  is  similar  in  form  and  therefore  is  not  reproduced  in  this  report. 
However,  the  essential  details  for  the  two  issues  are  summarized  in  the  first  table 
following  the  circular  and  the  final  allotments  of  new  certificates  issued  for  cash 
are  shown  in  the  second  table. 

DEPARTMENT  CIRCULAR  NO.  1048.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  August  1,  1960. 

I.  OFFERING  OP  CERTIFICATES 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  subject  to  allotment,  at  par 
and  accrued  interest,  from  the  people  of  the  United  States  for  certificates  of 
indebtedness  of  the  United  States,  designated  3}i  percent  Treasury  certificates  of 
indebtedness  of  Series  C-1961.  The  amount  of  the  offering  under  this  circular 
is  $7,750,000,000,  or  thereabouts.  Treasury  notes  of  Series  C-1960,  maturing 
August  15,  1960,  will  be  accepted  at  par  in  payment  or  exchange,  in  whole  or  in 
part,  for  the  new  certificates  subscribed  for,  to  the  extent  such  subscriptions  are 
allotted  by  the  Treasury.  The  books  will  be  open  only  on  August  1  and  August  2, 
1960,  for  the  receipt  of  subscription  for  this  issue. 

2.  The  Secretary  of  the  Treasury,  on  behalf  of  the  Federal  National  Mortgage 
Association,  offers  to  purchase  on  August  15,  1960,  at  par  and  accrued  interest. 
Federal  National  Mortgage  Association  3^  percent  notes  of  Series  ML-1960-A, 
dated  January  20,  1958,  due  August  23,  1960,  to  the  extent  to  which  subscriptions 
from  the  holders  thereof  to  Treasury  certificates  of  indebtedness  of  Series  C-1961 
hereunder  are  alloted  by  the  Treasury,  and  the  proceeds  from  the  par  amount 
of  such  notes  are  applied  to  the  payment,  in  whole  or  in  part,  of  the  certificates 
in  accordance  with  paragraph  2  of  section  IV  of  this  circular.  Tenders  of  the 
Federal  National  Mortgage  Association  3)^  percent  notes  of  Series  ML-1960-A 
for  that  purpose  are  invited. 

II.    DESCRIPTION    OF   CERTIFICATES 

1.  The  certificates  will  be  dated  August  15,  1960,  and  will  bear  interest  from 
that  date  at  the  rate  of  Zy%  percent  per  annum,  payable  on  a  semiannual  basis  on 
February  1  and  August  1,  1961.  They  will  mature  August  1,  1961,  and  will  not 
be  subject  to  call  for  redemption  prior  to  maturity. 

2.  The  income  derived  from  the  certificates  is  subject  to  all  taxes  imposed  under 
the  Internal  Revenue  Code  of  1954.  The  certificates  are  subject  to  estate,  in- 
heritance, 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. 

3.  The  certificates  will  be  acceptable  to  secure  deposits  of  public  moneys. 
They  will  not  be  acceptable  in  payment  of  taxes. 

233 


234   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

4.  Bearer  certificates  with  interest  coupons  attached  will  be  issued  in  denom- 
inations of  $1,000,  $5,000,  $10,000,  $100,000,  $1,000,000,  $100,000,000,  and  $500,- 
000,000.     The  certificates  will  not  be  issued  in  registered  form. 

5.  The  certificates  will  be  subject  to  the  general  regulations  of  the  Treasury 
Department,  now  or  hereafter  prescribed,  governing  United  States  certificates. 

III.    SUBSCRIPTION    AND    ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches 
and  at  the  Office  of  the  Treasurer  of  the  United  States,  Washington.  Only  the 
Federal  Reserve  Banks  and  the  Treasury  Department  are  authorized  to  act  as 
official  agencies.  Commercial  banks,  which  for  this  purpose  are  defined  as  banks 
accepting  demand  deposits,  maj^  submit  subscriptions  for  account  of  customers. 
Others  than  commercial  banks  will  not  be  permitted  to  enter  subscriptions  except 
for  t.heir  own  account.  Subscriptions  from  commercial  banks  for  their  own  ac- 
count will  be  restricted  in  each  case  to  an  amount  not  exceeding  50  percent  of  the 
combined  capital,  surplus,  and  undivided  profits  of  the  subscribing  bank.  Sub- 
scriptions from  commercial  and  other  banks  for  their  own  account,  federally  in- 
sured savings  and  loan  associations,  States,  political  subdivisions  or  instrumental- 
ities thereof,  public  pension  and  retirement  and  other  public  funds,  international 
organizations  in  which  the  United  States  holds  membership,  foreign  central 
banks  and  foreign  states,  dealers  w)io  make  primary  markets  in  Government 
securities  and  report  daily  to  the  Federal  Reserve  Bank  of  New  York  their  po- 
sitions with  respect  to  Government  securities  and  borrowings  thereon,  Govern- 
ment investment  accounts,  and  the  Federal  Reserve  Banks  will  be  received  with- 
out deposit.  Subscriptions  from  all  others  must  be  accompanied  by  payment 
(in  cash  or  in  Treasury  notes  of  Series  C-1960,  maturing  August  15,  1960,  at  par, 
or  Federal  National  ^lortgage  Association  notes  of  Series  AIL-1960-A  tendered 
for  purchase  under  paragraph  2  of  section  I,  hereof,  at  par)  of  2  percent  of  the 
amount  of  certificates  applied  for,  not  subject  to  withdrawal  until  after  allotment. 
Following  allotment,  any  portion  of  the  2  percent  payment  in  excess  of  2  percent 
of  the  amount  of  certificates  allotted  may  be  released  upon  the  request  of  the 
subscribers. 

2.  All  subscribers  are  required  to  agree  not  to  purchase  or  to  sell,  or  to  make 
any  agreements  with  respect  to  the  purchase  or  sale  or  other  disposition  of  any 
certificates  of  this  issue,  until  after  midnight  August  2,  1960. 

3.  Commercial  banks  in  submitting  subscriptions  will  be  required  to  certify 
that  they  have  no  beneficial  interest  in  any  of  the  subscriptions  they  enter  for  the 
account  of  their  customers,  and  that  their  customers  have  no  beneficial  interest 
in  the  banks'  subscriptions  for  their  own  account. 

4.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any 
subscription,  to  allot  less  than  the  amount  of  certificates  applied  for,  and  to  make 
different  percentage  allotments  to  various  classes  of  subscribers;  and  any  action 
he  may  take  in  these  respects  shall  be  final.  Subject  to  these  reservations,  all 
subscriptions  from  States,  political  subdivisions  or  instrumentalities  thereof, 
public  pension  and  retirement  and  other  public  funds,  international  organizations 
in  which  the  United  States  holds  membership,  foreign  central  banks  and  foreign 
states,  Government  investment  accounts,  and  the  Federal  Reserve  Banks,  will 
be  allotted  in  full.  The  basis  of  the  allotment  will  be  publicly  announced,  and 
allotment  notices  will  be  sent  out  promptly  upon  allotment. 

IV.    PAYMENT 

1.  Payment  at  par  and  accrued  interest,  if  any,  for  certificates  allotted  here- 
under must  be  made  or  completed  on  or  before  August  15,  1960,  or  on  later  allot- 
ment. In  every  case  where  payment  is  not  so  completed,  the  payment  with 
application  up  to  2  percent  of  the  amount  of  certificates  allotted  shall,  upon 
declaration  made  by  the  Secretary  of  the  Treasury  in  his  discretion,  be  forfeited 
to  the  United  States.  Payment  maj^  be  made  for  any  certificates  allotted  here- 
under in  cash  or  by  exchange  of  Treasury  notes  of  Series  C-1960,  maturing  August  15, 
1960,  which  will  be  accepted  at  par.  Where  payment  is  made  with  Treasury 
notes  of  Series  C-1960,  coupons  dated  August  15,  1960,  should  be  detached  from 
such  notes  by  holders  and  cashed  when  due. 

2.  In  addition,  payment  may  be  made  for  any  certificates  allotted  hereunder 
with  the  proceeds  of  the  par  amount  of  Federal  National  Mortgage  Association 
notes  of  Series  ML-1960-A  tendered  for  purchase  in  accordance  with  paragraph 
2  of  section   I  of  this  circular.     Federal   National    Mortgage  Association  notes 


EXHIBITS  235 

of  Series  ML-1960-A  tendered  for  purchase  must  have  coupons  dated  August 
23,  1960,  attached,  and  payment  will  be  made  at  par  and  accrued  interest  to 
August  15,  1960.  Accrued  interest  from  February  23,  1900,  to  August  15,  1960, 
on  the  Series  ML-1960-A  notes  ($17.31944  per  $1,000)  will  be  paid  following 
acceptance  of  the  notes. 

V.    GENERAL     PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up  to 
the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  certificates  allotted,  to  make  delivery  of  certificates  on  full-paid  subscriptions 
allotted,  and  they  may  issue  interim  receipts  pending  delivery  of  the  definitive 
certificates. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time,  pre- 
cribe  su]Dplemental  or  amendatory  rules  and  regulations  governing  the  offering, 
which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

Robert  B.  Anderson, 
Secretary  of  the  Treasury 


614359—62 16 


236   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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EXHIBITS 


237 


Allotments  of  Treasury  certificates  of  indebtedness  issued  during  the  fiscal  year  1961, 
by  Federal  Reserve  districts 

[In  thousands  of  dollars] 


Federal  Reserve  district 


Sii  percent 
Series  C-1961 
certificates '  2 


3  percent 
Series  A-1962 
certificates '  ^ 


Boston 

New  York 

Philadelphia. 

Cleveland 

Richmond 

Atlanta 

Chicago 

St.  Louis 

Minneapolis 

Kansas  City 

Dallas 

San  Francisco 

Treasury 

Total  certificate  allotments 


$55, 596 

, 539, 954 

44, 307 

205, 999 
77, 749 
80,483 

296, 176 
71, 875 
34, 673 
80, 937 
44, 713 

286, 815 
9,498 


$130, 589 
3, 416, 205 
105, 189 
194, 922 
120, 480 
127, 309 
505, 935 
83,556 
56, 051 
114, 520 
119,028 
501, 479 
33, 955 


<  7, 828, 775 


'  5, 509, 218 


'  Subscriptions  from  States,  political  subdivisions  or  instrumentalities  thereof,  public  pension  and  retire- 
ment and  other  public  funds,  international  organizations  in  which  the  United  States  holds  membership, 
foreign  central  banks  and  foreign  states,  Government  investment  accounts,  and  the  Federal  Reserve  Banks 
were  allotted  in  full. 

2  Subscriptions  from  subscribers  other  than  those  shown  in  footnote  1  were  allotted  13  percent. 

3  Subscriptions  from  sul^scribers  other  than  those  shown  in  footnote  1  were  allotted  27  percent  with  sub- 
scriptions for  $25,000  or  less  allotted  in  fuU  and  those  for  more  than  $25,000  allotted  not  less  than  $25,000. 

*  Includes  $2,078  million  for  cash  (including  proceeds  from  the  par  amount  of  Federal  National  Mortgage 
Association  35i  percent  notes  of  Series  ML-1960-A)  and  $5,751  million  for  Treasury  notes  of  Series  C-1960. 

'  Includes  $3,728  milhon  for  cash,  $54  million  for  Treasury  certificates  of  indebtedness  of  Series  B-1961, 
and  $1,727  million  for  Treasury  notes  of  Series  B-1961. 

Exhibit  2. — Treasury  notes 

Two  Treasury  circulars,  one  containing  an  exchange  and  the  other  a  cash  note 
offering  during  the  fiscal  year  1961,  are  reproduced  in  this  exhibit.  The  circular 
pertaining  to  the  other  note  offering  during  1961  is  similar  in  form  and  therefore 
is  not  reproduced  in  this  report.  However,  the  essential  details  for  each  issue 
are  summarized  in  the  first  table  following  the  circulars  and  the  final  allotments 
of  the  new  notes  issued  for  cash  or  in  exchange  for  maturing  securities  are  shown 
in  the  second  table. 

DEPARTMENT  CIRCULAR  NO.  1053.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  October  SI,  1960. 


I.    OFFERING    OF    NOTES 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  at  par,  from  the  people 
of  the  United  States  for  notes  of  the  United  States,  designated  3}^  percent  Treasury 
notes  of  Series  F-1962  in  exchange  for  which  any  of  the  following  securities, 
singly  or  in  combinations  aggregating  $1,000  or  multiples  thereof,  may  be  tendered: 

AYi  percent  Treasury  certificates  of  indebtedness  of  Series  C-1960,  maturing 
November  15,  1960 

2y%  percent  Treasury  bonds  of  1960,  maturing  November  15,  1960 
The  amount  of  the  offering  under  this  circular  will  be  limited  to  the  amount  of 
maturing  certificates  and  bonds  tendered  in  exchange  and  accepted.     The  books 
will  be  open  onl}^  on  October  31  through  November  2,  1960,  for  the  receipt  of 
subscriptions  for  this  issue. 

2.  In  addition  to  the  offering  under  this  circular,  holders  of  the  maturing 
securities  are  offered  the  privilege  of  exchanging  all  or  any  part  of  such  securities 
for  3^  percent  Treasury  bonds  of  1966,  which  offering  is  set  forth  in  Department 
Circular  No.  1054,  issued  simultaneously  with  this  circular. 


238        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
II.    DESCRIPTION    OF    NOTES 

1.  The  notes  will  be  dated  November  15,  1960,  and  will  bear  interest  from  that 
date  at  the  rate  of  3}i  percent  per  annum,  payable  on  a  semiannual  basis  on  Febru- 
ary 15  and  August  15,  1961,  and  on  February  15,  1962.  They  will  mature  Feb- 
ruary 15,  1962,  and  will  not  be  subject  to  call  for  redemption  prior  to  maturity. 

2.  The  income  derived  from  the  notes  is  subject  to  all  taxes  imposed  under  the 
Internal  Revenue  Code  of  1954.  The  notes  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. 

3.  The  notes  will  be  acceptable  to  secure  deposits  of  public  moneys.  They  will 
not  be  acceptable  in  payment  of  taxes. 

4.  Bearer  notes  with  interest  coupons  attached,  and  notes  registered  as  to  prin- 
cipal and  interest,  will  be  issued  in  denominations  of  $1,000,  $5,000,  $10,000, 
$100,000,  $1,000,000,  $100,000,000,  and  $500,000,000.  Provision  will  be  made 
for  the  interchange  of  notes  of  different  denominations  and  of  coupon  and  regis- 
tered notes,  and  for  the  transfer  of  registered  notes,  under  rules  and  regulations 
prescribed  by  the  Secretary  of  the  Treasury. 

5.  The  notes  will  be  subject  to  the  general  regulations  of  the  Treasury  Depart- 
ment, now  or  hereafter  prescribed,  governing  United  States  notes, 

III.  SUBSCRIPTION  AND  ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches 
and  at  the  Office  of  the  Treasurer  of  the  United  States,  Washington,  D.C.  Bank- 
ing institutions  generally  may  submit  subscriptions  for  account  of  customers,  but 
only  the  Federal  Reserve  Banks  and  the  Treasury  Department  are  authorized  to 
act  as  official  agencies. 

2.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any  sub- 
scription, and  to  allot  less  than  the  amount  of  notes  applied  for;  and  any  action  he 
may  take  in  these  respects  shall  be  final.  Subject  to  these  reservations,  all  sub- 
scriptions will  be  allotted  in  full.  Allotment  notices  will  be  sent  out  promptly 
upon  allotment. 

IV.  PAYMENT 

1.  Payment  at  par  for  notes  allotted  hereunder  must  be  made  on  or  before  No- 
vember 15,  1960,  or  on  later  allotment,  and  may  be  made  only  in  the  securities  of 
the  two  issues  enumerated  in  section  I  hereof,  which  will  be  accepted  at  par,  and 
should  accompany  the  subscription.  Coupons  dated  November  15,  1960,  should 
be  detached  from  the  maturing  securities  in  coupon  form  by  holders  and  cashed 
when  due.  In  the  case  of  registered  bonds,  final  interest  due  on  November  15, 
1960,  will  be  paid  by  check  drawn  in  accordance  with  the  assignments  on  the 
bonds  surrendered,  or  by  credit  in  any  account  maintained  by  a  banking  insti- 
tution with  the  Federal  Reserve  Bank  of  its  district. 

V.  ASSIGNMENT  OF  REGISTERED  BONDS 

1.  Treasury  bonds  of  1960  in  registered  form  tendered  in  payment  for  notes 
offered  hereunder  should  be  assigned  by  the  registered  payees  or  assignees  there- 
of, in  accordance  with  the  general  regulations  of  the  Treasury  Department  govern- 
ing assignments  for  transfer  or  exchange,  in  one  of  the  forms  hereafter  set  forth, 
and  thereafter  should  be  surrendered  with  the  subscription  to  a  Federal  Reserve 
Bank  or  branch  or  to  the  Office  of  the  Treasurer  of  the  United  States,  Washington, 
D.C.  The  bonds  must  be  delivered  at  the  expense  and  risk  of  the  holder.  If  the 
notes  are  desired  registered  in  the  same  name  as  the  bonds  surrendered,  the  assign- 
ment should  be  to  "The  Secretary  of  the  Treasury  for  exchange  for  syi  percent 
Treasury  notes  of  Series  F-1962";  if  the  notes  are  desired  registered  in  another 
name,  the  assignment  should  be  to  "The  Secretary  of  the  Treasury  for  exchange 

for  3>4  percent  Treasury  notes  of  Series  F-1962  in  the  name  of ";  if 

notes  in  coupon  form  are  desired,  the  assignment  should  be  to  "The  Secretary  of 
the  Treasury  for  exchange  for  3%  percent  Treasury  notes  of  Series  F-1962  in 
coupon  form  to  be  delivered  to ". 


EXHIBITS  239 

VI.  GENERAL  PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up  to 
the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  notes  allotted,  to  make  delivery  of  notes  on  full-paid  subscriptions  allotted, 
and  they  may  issue  interim  receipts  pending  delivery  of  the  definitive  notes. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time,  pre- 
scribe supplemental  or  amendatory  rules  and  regulations  governing  the  offering, 
which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

Robert  B.  Anderson, 

Secretary  of  the  Treasury. 

DEPARTMENT  CIRCULAR  NO.  1057.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  February  6,  1961. 

I.  offering  of  notes 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  subject  to  allotment,  at  par 
and  accrued  interest,  from  the  people  of  the  United  States  for  notes  of  the  United 
States,  designated  3>4  percent  Treasury  notes  of  Series  G-1962.  The  amount  of 
the  offering  under  this  circular  is  $6,900,000,000,  or  thereabouts.  Treasury  cer- 
tificates of  indebtedness  of  Series  A-1961,  maturing  February  15,  1961,  will  be 
accepted  at  par  in  payment  or  exchange,  in  whole  or  in  part,  for  the  notes  sub- 
scribed for,  to  the  extent  such  subscriptions  are  allotted  by  the  Treasury.  The 
books  will  be  open  only  on  February  6,  1961,  for  the  receipt  of  subscriptions  for 
this  issue. 

II.  description  of  notes 

1.  The  notes  will  be  dated  February  15,  1961,  and  will  bear  interest  from  that 
date  at  the  rate  of  3^4  percent  per  annum,  pavable  semiannually  on  August  15, 
1961,  and  February  15  and  August  15,  1962.  They  will  mature  August  15,  1962, 
and  will  not  be  subject  to  call  for  redemption  prior  to  maturity. 

2.  The  income  derived  from  the  notes  is  subject  to  all  taxes  imposed  under  the 
Internal  Revenue  Code  of  J  954.  The  notes  are  subject  to  estate,  inheritance, 
gift,  or  other  excise  taxes,  whether  Federal  or  State,  but  are  exempt  from  all  tax- 
ation 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. 

3.  The  notes  will  be  acceptable  to  secure  deposits  of  public  moneys.  They 
will  not  be  acceptable  in  payment  of  taxes. 

4.  Bearer  notes  with  interest  coupons  attached,  and  notes  registered  as  to 
principal  and  interest,  will  be  issued  in  denominations  of  $1,000,  $5,000,  $10,000, 
$100,000,  $1,000,000,  $100,000,000,  and  $500,000,000.  Provision  will  be  made  for 
the  interchange  of  notes  of  different  denominations  and  of  coupon  and  registered 
notes,  and  for  the  transfer  of  registered  notes,  under  rules  and  regulations  pre- 
scribed by  the  Secretary  of  the  Treasury. 

5.  The  notes  will  be  subject  to  the  general  regulations  of  the  Treasury  Depart- 
ment, now  or  hereafter  prescribed,  governing  United  States  notes. 

III.  subscription  and  allotment 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches 
and  at  the  Office  of  the  Treasurer  of  the  United  States,  Washington.  Only  the 
Federal  Reserve  Banks  and  the  Treasury  Department  are  authorized  to  act  as 
official  agencies.  Commercial  banks,  which  for  this  purpose  are  defined  as  banks 
accepting  demand  deposits,  may  submit  subscriptions  for  account  of  customers 
provided  the  names  of  the  customers  are  set  forth  in  such  subscriptions.  Others 
than  commercial  banks  will  not  be  permitted  to  enter  subscriptions  except  for 
their  own  account.  Subscriptions  from  commercial  banks  for  their  own  account 
will  be  restricted  in  each  case  to  an  amount  not  exceeding  50  percent  of  the 
combined  capital,  surplus,  and  undivided  profits  of  the  subscribing  bank.  Sub- 
scriptions will  be  received  without  deposit  from  commercial  and  other  banks  for 


240   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

their  own  account,  federally  insured  savings  and  loan  associations,  States,  political 
subdivisions  or  instrumentalities  thereof,  public  pension  and  retirement  and  other 
public  funds,  international  organizations  in  which  the  United  States  holds  mem- 
bership, foreign  central  banks  and  foreign  states,  dealers  who  make  primary- 
markets  in  Government  securities  and  report  dailj^  to  the  Federal  Reserve  Banks 
of  New  York  their  positions  with  respect  to  Government  securities  and  borrowings 
thereon.  Government  investment  accounts,  and  the  Federal  Reserve  Banks. 
Subscriptions  from  all  others  must  be  accompanied  by  payment  (in  cash  or  in 
Treasury  certificates  of  indebtedness  of  Series  A-196i,  maturing  February  15, 
1961,  at  par)  of  2  percent  of  the  amount  of  notes  applied  for,  not  subject  to  with- 
drawal until  after  allotment.  Following  allotment,  any  portion  of  the  2  percent 
payment  in  excess  of  2  percent  of  the  amount  of  notes  allotted  may  be  released 
upon  the  request  of  the  subscribers. 

2.  All  subscribers  are  required  to  agree  not  to  purchase  or  to  sell,  or  to  make 
any  agreements  with  respect  to  the  purchase  or  sale  or  other  disposition  of  any 
notes  of  this  issue,  until  after  midnight  February  6,  1961. 

3.  Commercial  banks  in  submitting  subscriptions  will  be  required  to  certify 
that  they  have  no  beneficial  interest  in  any  of  the  subscriptions  they  enter  for 
the  account  of  their  customers,  and  that  their  customers  have  no  beneficial  interest 
in  the  banks'  subscriptions  for  their  own  account. 

4.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any 
subscription,  to  allot  less  than  the  amount  of  notes  applied  for,  and  to  make 
different  percentage  allotments  to  various  classes  of  subscribers;  and  any  action 
he  may  take  in  these  respects  shall  be  final.  Subject  to  these  reservations,  all 
subscriptions  from  States,  political  subdivisions  or  instrumentalities  thereof, 
public  pension  and  retirement  and  other  public  funds,  international  organizations 
in  which  the  United  States  holds  membership,  foreign  central  banks  and  foreign 
states,  Government  investment  accounts,  and  the  Federal  Reserve  Banks  will 
be  allotted  in  full.  The  basis  of  the  allotment  will  be  publicly  announced,  and 
allotment  notices  will  be  sent  out  promptly  upon  allotment. 

IV.    PAYMENT 

1.  Payment  at  par  and  accrued  interest,  if  any,  for  notes  allotted  hereunder 
must  be  made  or  completed  on  or  before  February  15,  1961,  or  on  later  allotment. 
In  every  case  where  payment  is  not  so  completed,  the  payment  with  application 
up  to  2  percent  of  the  amount  of  notes  allotted  shall,  vipon  declaration  made  by 
the  Secretary  of  the  Treasury  in  his  discretion,  be  forfeited  to  the  United  States. 
Payment  may  be  made  for  any  notes  allotted  hereunder  in  cash  or  by  exchange 
of  Treasury  certificates  of  indebtedness  of  Series  A-1961,  maturing  February  15, 
1961,  which  will  be  accepted  at  par.  Where  payment  is  made  with  Treasury 
certificates  of  indebtedness  of  Series  A-1961,  coupons  dated  February  15,  1961, 
should  be  detached  from  such  certificates  by  holders  and  cashed  when  due. 

V.    GENERAL    PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up 
to  the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  notes  allotted,  to  make  delivery  of  notes  on  full-paid  subscriptions  allotted, 
and  they  may  issue  interim  receipts  pending  deHvery  of  the  definitive  notes. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time, 
prescribe  supplemental  or  amendatory  rules  and  regulations  governing  the 
offering,  which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

DoTJGLAS  Dillon, 
Secretary  of  the  Treasury. 


EXHIBITS 


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EXHIBITS  243 

Exhibit  3. — Treasury  bonds 

Five  Treasury  circulars  for  five  of  the  nine  bond  offerings  during  the  fiscal  year 
1961  are  reproduced  in  this  exhibit:  a  Rural  Electrification  Administration  Series, 
a  cash  offering  (additional  issue);  an  advance  refunding  exchange  offering  (addi- 
tional issue);  an  exchange  offering  for  maturing  issues;  and  an  exchange  offering 
(additional  issue)  for  U.S.  savings  bonds  of  Series  F  and  G  maturing  during  the 
calendar  year  1961.  Circulars  pertaining  to  the  other  bond  offerings  are  similar 
in  form  and  therefore  are  not  reproduced  in  this  report.  However,  the  essential 
details  for  each  issue  are  summarized  in  the  first  table  following  the  circulars  and 
the  final  allotments  of  the  new  bonds  issued  for  cash  and  in  exchange  for  maturing 
or  outstanding  securities  are  shown  in  the  second  table. 

DEPARTMENT  CIRCULAR  NO.  1046.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  June  27,  1960. 

I.  OFFERING  OF  BONDS 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  gives  notice  of  an  issue  of  bonds  of  the  United 
States,  designated  2  percent  Treasury  bonds — R.E.A.  Series.  These  bonds  may 
be  subscribed  for,  at  par,  effective  July  1,  1960,  by  borrowers  from  the  Rural 
Electrification  Administration,  U.S.  Department  of  Agriculture.  The  bonds  will 
be  sold  to  such  borrowers  with  the  specific  approval  of  the  Rural  Electrification 
Administration  for  each  transaction.  Subscriptions  for  the  bonds  shall  be  sub- 
mitted to  the  Secretarj^  of  the  Treasury  through  the  Rural  Electrification 
Administration . 

II.  DESCRIPTION  OF  BONDS 

1.  The  bonds  will  bear  interest  at  the  rate  of  2  percent  per  annum,  payable  on 
a  semiannual  basis  on  January  1  and  July  1  in  each  year  until  the  principal 
amount  becomes  payable,  and  will  be  issued  in  amounts  in  multiples  of  $1,000. 
Each  bond  will  be  issued  as  of,  and  will  bear  interest  from,  the  date  payment 
therefor  is  received,  and  will  mature  twelve  years  from  such  date,  but  may  be 
redeemed  at  the  option  of  the  United  States  or  the  Rural  Electrification  Admin- 
istration borrowers,  in  whole  or  in  part,  at  par  and  accrued  interest,  at  any  time, 
upon  not  less  than  30  nor  more  than  60  days'  notice  in  writing  given  by  either 
party  to  the  other.  From  the  date  of  redemption  designated  in  any  such  notice, 
interest  on  the  bond  or  bonds  or  any  part  thereof  to  be  redeemed  shall  cease, 
and  the  unredeemed  portion,  if  any,  shall  be  reissued  bearing  the  same  issue  date 
as  the  bond  surrendered.  Any  such  notice  of  redemption  given  by  a  Rural  Elec- 
trification Administration  borrower  shall  be  addressed  to  the  Secretary  of  the 
Treasury. 

2.  The  income  derived  from  the  bonds  is  subject  to  all  taxes  imposed  under 
the  Internal  Revenue  Code  of  1954.  The  bonds  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. 

3.  The  bonds  will  not  be  acceptable  to  secure  deposits  of  public  monies.  They 
will  not  be  entitled  to  any  privilege  of  conversion.  They  will  not  be  transferable. 
Accordingly,  they  may  not  be  sold,  discounted,  hypothecated  as  collateral  for  a 
loan,  or  pledged  as  security  for  the  performance  of  an  obhgation  or  for  any  other 
purpose.  The  bonds  will  be  issued  in  registered  form  only  in  the  name  of  the 
Treasurer  of  the  United  States  in  trust  for  the  Rural  Electrification  Administra- 
tion borrowers  to  which  they  are  allotted.  They  will  be  subject  to  the  general 
regulations  of  the  Treasury  Department,  now  or  hereafter  prescribed,  governing 
United  States  bonds,  so  far  as  applicable. 

III.  GENERAL  PROVISIONS 

1.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time, 
prescribe  supplemental  or  amendatory  rules  and  regulations  with  respect  to  this 
issue  of  bonds,  and  he  may  terminate  the  issue  at  any  time  without  notice. 

Robert  B.  Anderson, 
Secretary  of  the  Treasury. 


244        1961    REPORT    OF    THE    SECRETARY    OF   THE    TREASURY 

DEPARTMENT  CIRCULAR  NO.  1049.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  August  1,  1960. 

I.  OFFERING  OF  BONDS 

1.  The  Secretary  of  the  Treasury,  pursviant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  subject  to  allotment,  at  par 
and  accrued  interest,  from  the  people  of  the  United  States  for  bonds  of  the  United 
States,  designated  3^  percent  Treasury  bonds  of  1968.  The  amount  of  the  offer- 
ing under  this  circular  is  $1,000,000,000,  or  thereabouts.  Treasury  notes  of 
Series  C-1960,  maturing  August  15,  1960,  will  be  accepted  at  par  in  payment  or 
exchange,  in  whole  or  in  part,  for  the  new  bonds  subscribed  for,  to  the  extent  such 
subscriptions  are  allotted  by  the  Treasury.  The  books  will  be  open  only  on 
August  1  and  August  2,  1960,  for  the  receipt  of  subscriptions  for  this  issue. 

2.  The  Secretary  of  the  Treasury,  on  behalf  of  the  Federal  National  Mortgage 
Association,  offers  to  purchase  on  August  15,  1960,  at  par  and  accrued  interest, 
Federal  National  Mortgage  Association  zy%  percent  notes  of  Series  ML-1960-A, 
dated  January  20,  1958,  due  August  23,  1960,  to  the  extent  to  which  subscriptions 
from  the  holders  thereof  to  Treasury  bonds  of  1968  hereunder  are  allotted  by  the 
Treasury,  and  the  proceeds  from  the  par  amount  of  such  notes  are  applied  to  the 
payment,  in  whole  or  in  part,  of  the  bonds  in  accordance  with  paragraph  2  of 
section  IV  of  this  circular.  Tenders  of  the  Federal  National  INIortgage  Associa- 
tion m  percent  notes  of  Series  ML-1960-A  for  that  purpose  are  invited. 

II.    DESCRIPTION  OF  BONDS 

1.  The  bonds  now  oflFered  will  be  an  addition  to  and  will  form  a  part  of  the  series 
of  Zy?,  percent  Treasury  bonds  of  1968  issued  pursuant  to  Department  Circular 
No.  1044,  dated  June  8, 1960,  will  be  freely  interchangeable  therewith,  and  are  iden- 
tical in  all  respects  therewith  except  that  interest  on  the  bonds  to  be  issued  under 
this  circular  will  accrue  from  August  15,  1960.  Subject  to  the  provision  for  the 
accrual  of  interest  from  August  15,  1960,  on  the  bonds  now  offered,  the  bonds  are 
described  in  the  following  quotation  from  Department  Circular  No.  1044: 

"1.  The  bonds  will  be  dated  June  23,  1960,  and  will  bear  interest  from  that  date 
at  the  rate  of  2>y%  percent  per  annum,  payable  on  a  semiannual  basis  on  November 
15,  1960,  and  thereafter  on  Maj^  15  and  November  15  in  each  year  until  the 
principal  amount  becomes  payable.  They  will  mature  May  15,  1968,  and  will 
not  be  subject  to  call  for  redemption  prior  to  maturit}\ 

"2.  The  income  derived  from  the  bonds  is  subject  to  all  taxes  imposed  under  the 
Internal  Revenue  Code  of  1954.  The  bonds  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. 

"3.  The  bonds  will  be  acceptable  to  secure  deposits  of  public  moneys.  They 
will  not  be  acceptable  in  payment  of  taxes. 

"4.  Bearer  bonds  with  interest  coupons  attached,  and  bonds  registered  as  to 
principal  and  interest,  will  be  issued  in  denominations  of  $500,  $1,000,  $5,000, 
$10,000,  $100,000,  and  $1,000,000.  Provision  will  be  made  for  the  interchange  of 
bonds  of  different  denominations  and  of  coupon  and  registered  bonds,  and  for 
the  transfer  of  registered  bonds,  under  rules  and  regulations  prescribed  by  the 
Secretary  of  the  Treasury. 

"5.  The  bonds  will  be  subject  to  the  general  regulations  of  the  Treasury  De- 
partment, now  or  hereafter  prescribed,  governing  United  States  bonds." 

III.    SUBSCRIPTION  AND  ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches  and 
at  the  Office  of  the  Treasurer  of  the  United  States,  Washington.  Only  the  Federal 
Reserve  Banks  and  the  Treasury  Department  are  authorized  to  act  as  official  agen- 
cies. Commercial  banks,  which  for  this  purpose  are  defined  as  banks  accepting 
demand  deposits,  may  submit  subscriptions  for  account  of  customers.  Others 
than  commercial  banks  will  not  be  permitted  to  enter  subscriptions  except  for 
their  own  account.  Subscriptions  from  commercial  banks  for  their  own  account 
will  be  restricted  in  each  case  to  an  amount  not  exceeding  25  percent  of  the  com- 


EXHIBITS  245 

bined  capital,  surplus,  and  undivided  profits  of  the  subscribing  bank.  Subscrip- 
tions from  commercial  and  other  banks  for  their  own  account,  federally  insured 
savings  and  loan  associations,  States,  political  subdivisions  or  instrumentalities 
thereof,  pubUc  pension  and  retirement  and  other  public  funds,  international  or- 
ganizations in  which  the  United  States  holds  membership,  foreign  central  banks 
and  foreign  states,  dealers  who  make  primary  markets  in  Government  securities 
and  report  daily  to  the  Federal  Reserve  Bank  of  New  York  their  positions  with 
respect  to  Government  securities  and  borrowings  thereon,  Government  investment 
accounts,  and  the  Federal  Reserve  Banks  will  be  received  without  deposit.  Sub- 
scriptions from  all  others  must  be  accompanied  by  payment  (in  cash  or  in  Treasury 
notes  of  Series  C-1960,  maturing  August  15,  1960,  at  par,  or  Federal  National 
Mortgage  Association  notes  of  Series  ML-1960-A  tendered  for  purchase  under 
paragraph  2  of  section  I,  hereof,  at  par)  of  20  percent  of  the  amount  of  bonds 
applied  for,  not  subject  to  withdrawal  until  after  allotment.  Following  allotment, 
any  portion  of  the  20  percent  payment  in  excess  of  20  percent  of  the  amount  of 
bonds  allotted  may  be  released  upon  the  request  of  the  subscribers. 

2.  Commercial  banks  in  submitting  subscriptions  will  be  required  to  certify 
that  they  have  no  beneficial  interest  in  any  of  the  subscriptions  they  enter  for  the 
account  of  their  customers,  and  that  their  customers  have  no  beneficial  interest  in 
the  banks'  subscriptions  for  their  own  account. 

3.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any  sub- 
scription, to  allot  less  than  the  amount  of  bonds  applied  for,  and  to  make  different 
percentage  allotments  to  various  classes  of  subscribers;  and  any  action  he  may 
take  in  these  respects  shall  be  final.  The  basis  of  the  allotment  will  be  publicly 
announced,  and  allotment  notices  will  be  sent  out  promptly  upon  allotment. 

IV.    PAYMENT 

1.  Payment  at  par  and  accrued  interest  from  June  23,  1960,  to  August  15,  1960 
($5.58084  per  $1,000),  for  bonds  allotted  hereunder  must  be  made  or  completed  on 
or  before  August  15,  1960,  or  on  later  allotment.  In  every  case  where  payment  is 
not  so  completed,  the  payment  with  application  up  to  20  percent  of  the  amount  of 
bonds  allotted  shall,  upon  declaration  made  by  the  Secretary  of  the  Treasury  in 
his  discretion,  be  forfeited  to  the  United  States.  Payment  may  be  made  for  any 
bonds  allotted  hereunder  in  cash  or  by  exchange  of  Treasury  notes  of  Series 
C-1960,  maturing  August  15,  1960,  which  will  be  accepted  at  par.  Where  pay- 
ment is  made  with  Treasury  notes  of  Series  C-1960,  coupons  dated  August  15, 
1960,  should  be  detached  from  such  notes  by  holders  and  cashed  when  due. 

2.  In  addition,  payment  may  be  made  for  any  bonds  allotted  hereunder  with 
the  proceeds  of  the  par  amount  of  Federal  National  Mortgage  Association  notes  of 
Series  ML-1960-A  tendered  for  purchase  in  accordance  with  paragraph  2  of  sec- 
tion I  of  this  circular.  Federal  National  Mortgage  Association  notes  of  Series 
MLr-1960-A  tendered  for  purchase  must  have  coupons  dated  August  23,  1960, 
attached,  and  payment  will  be  made  at  par  and  accrued  interest  to  August  15, 
1960.  Accrued  interest  from  February  23,  1960,  to  August  15,  1960,  on  the  Series 
MLr-1960-A  notes  ($17.31944  per  $1,000)  will  be  credited,  and  accrued  interest 
from  June  23,  1960,  to  August  15,  1960  ($5.58084  per  $1,000),  will  be  charged  and 
the  difference  $11.7386  per  $1,000  will  be  paid  subscribers  following  acceptance  of 
the  notes. 

V.    GENERAL  PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up  to 
the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment  for 
bonds  allotted,  to  make  delivery  of  bonds  on  full-paid  subscriptions  allotted,  and 
they  may  issue  interim  receipts  pending  delivery  of  the  definitive  bonds. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time,  pre- 
scribe supplemental  or  amendatory  rules  and  regulations  governing  the  offering, 
which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

Robert  B.  Anderson, 
Secretary  of  the  Treasury. 


246        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 

DEPARTMENT  CIRCULAR  NO.  1051.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  September  12,  1960. 

I.    OFFERING    OF    BONDS 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  at  par  and  accrued  interest, 
from  the  people  of  the  United  States  for  bonds  of  the  United  States,  designated 
ZYi  percent  Treasury  bonds  of  1990,  in  exchange  for  2>^  percent  Treasury  bonds 
of  1963-68,  dated  December  1,  1942,  due  December  15,  1968.  Exchanges  will 
be  made  at  par  with  adjustment  of  interest  as  provided  in  section  IV  hereof. 
Subscriptions  to  the  offering  under  this  circular  and  the  offering  of  3}^  percent 
Treasury  bonds  of  1998  under  Department  Circular  No.  1052,  issued  simul- 
taneously with  this  circular  are  invited  up  to  a  combined  amount  not  to  exceed 
$4,500,000,000,  or  thereabouts.  If  subscriptions  exceed  this  amount  they  will 
be  subject  to  allotment  on  the  same  basis  for  each  of  the  two  issues.  In  addition 
to  the  amount  offered  for  public  subscription,  the  Secretary  of  the  Treasury 
reserves  the  right  to  issue  in  exchange  to  Government  investment  accounts  an 
aggregate  amount  not  to  exceed  $550,000,000  of  the  bonds  offered  hereunder 
and  the  bonds  offered  simultaneously  under  Department  Circular  No.  1052. 
The  books  will  be  open  only  on  September  12  through  September  20,  1960,  for 
the  receipt  of  subscriptions  for  this  issue. 

2.  Nonrecognition  of  gain  or  loss  for  Federal  incoine  tax  purposes. — Pursuant  to 
the  provisions  of  section  1037(a)  of  the  Internal  Revenue  Code  of  1954  as  added 
by  Public  Law  86-346  (approved  September  22,  1959),  the  Secretary  of  the 
Treasury  hereby  declares  that  no  gain  or  loss  shall  be  recognized  for  Federal 
income  tax  purposes  upon  the  exchange  with  the  United  States  of  the  2}^  percent 
Treasury  bonds  of  1963-68,  due  December  15,  1968,  solely  for  the  3>4  percent 
Treasury  bonds  of  1990.  Gain  or  loss,  if  any,  upon  the  obligations  surrendered 
in  exchange  will  be  taken  into  account  upon  the  disposition  or  redemption  of  the 
new  obligations. 

II.    DESCRIPTION    OF   BONDS 

1.  The  bonds  now  offered  will  be  an  addition  to  and  will  form  a  part  of  the  series 
of  SYi  percent  Treasury  bonds  of  1990  issued  pursuant  to  Department  Circular 
No.  1005,  dated  February  3,  1958,  will  be  freely  interchangeable  therewith,  and 
are  identical  in  all  respects  therewith  except  that  interest  on  the  bonds  to  be 
issued  under  this  circular  will  accrue  from  October  3,  1960.  Subject  to  the 
provision  for  the  accrual  of  interest  from  October  3,  1960,  on  the  bonds  now 
offered,  the  bonds  are  described  in  the  following  quotation  from  Department 
Circular  No.  1005: 

"1.  The  bonds  will  be  dated  February  14,  1958,  and  will  bear  interest  from  that 
date  at  the  rate  of  3>^  percent  per  annum,  payable  on  a  semiannual  basis  on 
August  15,  1958,  and  thereafter  on  February  15  and  August  15  in  each  year 
until  the  principal  amount  becomes  payable.  They  will  mature  February  15, 
1990,  and  will  not  be  subject  to  call  for  redemption  prior  to  maturity. 

"2.  The  income  derived  from  the  bonds  is  subject  to  all  taxes  imposed  under 
the  Internal  Revenue  Code  of  1954.  The  bonds  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. 

"3.  The  bonds  will  be  acceptable  to  secure  deposits  of  public  moneys. 

"4.  Bearer  bonds  with  interest  coupons  attached,  and  bonds  registered  as  to 
principal  and  interest,  will  be  issued  in  denominations  of  $500,  $1,000,  $5,000, 
$10,000,  $100,000,  and  $1,000,000.  Provision  will  be  made  for  the  interchange 
of  bonds  of  different  denominations  and  of  coupon  and  registered  bonds,  and  for 
the  transfer  of  registered  bonds,  under  rules  and  regulations  prescribed  by  the 
Secretary  of  the  Treasury. 

"5.  Any  bonds  issued  hereunder  which  upon  the  death  of  the  owner  constitute 
part  of  his  estate,  will  be  redeemed  at  the  option  of  the  duly  constituted  repre- 


EXHIBITS  247 

sentatives  of  the  deceased  owner's  estate,  at  par  and  accrued  interest  to  date  of 
payment/  provided: 

(a)  that  the  bonds  were  actually  owned  by  the  decedent  at  the  time  of  his 
death;  and 

(b)  that  the  Secretary  of  the  Treasury  be  authorized  to  apply  the  entire 
proceeds  of  redemption  to  the  payment  of  Federal  estate  taxes. 

Registered  bonds  submitted  for  redemption  hereunder  must  be  duly  assigned 
to  "The  Secretary  of  the  Treasury  for  redemption,  the  proceeds  to  be  paid  to  the 

District  Director  of  Internal  Revenue  at for  credit  on  Federal  estate 

taxes  due  from  estate  of "     Owing  to  the  periodic  closing  of  the 

transfer  books  and  the  impossibility  of  stopping  payment  of  interest  to  the 
registered  owner  during  the  closed  period,  registered  bonds  received  after  the 
closing  of  the  books  for  payment  during  such  closed  period  will  be  paid  only  at 
par  with  a  deduction  of  interest  from  the  date  of  payment  to  the  next  interest 
payment  date;  2  bonds  received  during  the  closed  period  for  payment  at  a  date 
after  the  books  reopen  will  be  paid  at  par  plus  accrued  interest  from  the  reopening 
of  the  books  to  the  date  of  payment.  In  either  case  checks  for  the  full  six  months' 
interest  due  on  the  last  day  of  the  closed  period  will  be  forwarded  to  the  owner 
in  due  course.  All  bonds  submitted  must  be  accompanied  by  JForm  PD  1782,^ 
properly  completed,  signed,  and  certified,  and  by  proof  of  the  representatives' 
authority  in  the  form  of  a  court  certificate  or  a  certified  copy  of  the  repre- 
sentatives' letters  of  appointment  issued  by  the  court.  The  certificate,  or  the 
certification  to  the  letters,  must  be  under  the  seal  of  the  court,  and  except  in 
the  case  of  a  corporate  representative,  must  contain  a  statement  that  the  appoint- 
ment is  in  full  force  and  be  dated  within  six  months  prior  to  the  submission  of 
the  bonds,  unless  the  certificate  or  letters  show  that  the  appointment  was  made 
within  one  year  immediately  prior  to  such  submission.  Upon  payment  of  the 
bonds  appropriate  memorandum  receipt  will  be  forwarded  to  the  representatives, 
which  will  be  followed  in  due  course  by  formal  receipt  from  the  District  Director 
of  Internal  Revenue. 

"6.  The  bonds  will  be  subject  to  the  general  regulations  of  the  Treasury  De- 
partment, now  or  hereafter  prescribed,  governing  United  States  bonds." 

III.    SUBSCRIPTION    AND    ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches  and 
at  the  Office  of  the  Treasurer  of  the  United  States,  Washington,  D.C.  Only  the 
Federal  Reserve  Banks  and  the  Treasury  Department  are  authorized  to  act  as 
official  agencies.  Banking  institutions  generally  may  submit  subscriptions  for 
account  of  customers.  Subscriptions  from  banking  institutions  for  their  own 
account,  federally  insured  savings  and  loan  associations,  States,  political  sub- 
divisions or  instrumentalities  thereof,  public  pension  and  retirement  and  other 
public  funds,  international  organizations  in  which  the  United  States  holds  mem- 
bership, foreign  central  banks  and  foreign  states,  Federal  Reserve  Banks,  and 
Government  investment  accounts  will  be  received  without  deposit.  Subscriptions 
from  all  others  must  be  accompanied  by  the  deposit  of  2}^  percent  Treasury  bonds 
of  1963-68,  due  December  15,  1968,  in  the  face  amount  of  not  less  than  10  percent 
of  the  amount  of  bonds  applied  for,  not  subject  to  withdrawal  until  after  allotment. 
Registered  bonds  submitted  as  deposits  should  not  be  assigned.  After  allotment 
detached  assignment  forms  may  be  used  as  provided  in  section  V  hereof. 

2.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any  sub- 
scription, to  allot  less  than  the  amount  of  bonds  applied  for,  and  to  make  different 
percentage  allotments  to  various  classes  of  subscribers;  and  any  action  he  may  take 
in  these  respects  shall  be  final.  The  basis  of  the  allotment  will  be  publicly 
announced,   and  allotment  notices  will  be  sent  out  promptly  upon  allotment. 

IV.    PAYMENT 

1.  Payment  at  par  for  bonds  allotted  hereunder  must  be  made  on  or  before 
October  3,  1960,  or  on  later  allotment,  and  may  be  made  only  in  2}^  percent  Treas- 

'  An  exact  half-year's  interest  is  computed  for  each  full  half-year  period  irrespective  of  the  actual  number 
of  days  in  the  half  year.  For  a  fractional  part  of  any  half  year,  computation  is  on  the  basis  of  the  actual 
number  of  days  in  such  half  year. 

_  2  The  transfer  books  are  closed  from  January  16  to  February  15,  and  from  July  16  to  August  1.5  (both  dates 
mclusive)  in  each  year. 

s  Copies  of  Form  PD  1782  may  be  obtained  from  any  Federal  Reserve  Bank  or  from  the  Treasiory  Depart- 
ment, Washington,  D.C. 


248   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

ury  bonds  of  1963-68,  due  December  15,  1968,  which  will  be  accepted  at  par. 
Coupons  dated  December  15,  1960,  and  all  subsequent  coupons,  must  be  attached 
to  the  bonds  in  coupon  form  when  surrendered.  Accrued  interest  from  June  15, 
1960,  to  October  3,  1960  ($7.51366  per  $1,000),  on  the  bonds  surrendered  will  be 
credited,  and  accrued  interest  from  August  15,  1960,  to  October  3,  1960  ($4.66033 
per  $1,000),  on  the  bonds  to  be  issued  will  be  charged,  and  the  difference  (.S2. 85333 
per  $1,000)  will  be  paid  subscribers,  in  the  case  of  bearer  bonds  following  their  ac- 
ceptance, and  in  the  case  of  registered  bonds  following  discharge  of  registration. 
In  the  case  of  registered  bonds,  the  payment  will  be  made  by  check  drawn  in  ac- 
cordance with  the  assignments  on  the  bonds  surrendered,  or  by  credit  in  any  account 
maintained  by  a  banking  institution  with  the  Federal  Reserve  Bank  of  its  district. 

V.    ASSIGNMENT    OF    REGISTERED    BONDS 

1.  After  allotment  the  2%  percent  Treasury  bonds  of  1963-68  in  registered 
form  tendered  in  payment  for  bonds  offered  hereunder  should  be  assigned  by  the 
registered  payees  or  assignees  thereof,  in  accordance  with  the  general  regulations 
of  the  Treasury  Department  governing  assignments  for  transfer  or  exchange,  in 
one  of  the  forms  hereafter  set  forth,  and  thereafter  should  be  surrendered  to  a 
Federal  Reserve  Bank  or  branch  or  to  the  OfRce  of  the  Treasurer  of  the  United 
States,  Washington,  D.C.  If  the  new  bonds  are  desired  registered  in  the  same 
name  as  the  bonds  surrendered  in  exchange,  the  assignment  should  be  to  "The 
Secretary  of  the  Treasury  for  exchange  for  3)4  percent  Treasury  bonds  of  1990"; 
if  the  new  bonds  are  desired  registered  in  another  name,  the  assignment  should  be 
to  "The  Secretary  of  the  Treasury  for  exchange  for  3}^  percent  Treasury  bonds 

of  1990  in  the  name  of ";  if  new  bonds  in  coupon  form  are  desired, 

the  assignment  should  be  to  "The  Secretary  of  the  Treasury  for  exchange  for  S]4 

percent  Treasury  bonds  of  1990  in  coupon  form  to  be  delivered  to ". 

Detached  assignment  forms  may  be  used  for  the  convenience  of  subscribers. 

VI.    GENERAL    PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up  to 
the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  bonds  allotted,  to  make  delivery  of  bonds  on  full-paid  subscriptions  allotted, 
and  they  may  issue  interim  receipts  pending  delivery  of  the  definitive  bonds. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time, 
prescribe  supplemental  or  amendatory  rules  and  regulations  governing  the  offer- 
ing, which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks, 

Julian  B.  Baird, 
Acting  Secretary  of  the  Treasury. 


DEPARTMENT  CIRCULAR  NO.   1054.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  October  31,  1960. 

I.  offering  of  bonds 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  at  par,  from  the  people  of 
the  United  States  for  bonds  of  the  United  States  designated  3%  percent  Treasury 
bonds  of  1966,  in  exchange  for  which  any  of  the  following  securities  may  be 
tendered: 

4%  percent  Treasury  certificates  of  indebtedness  of  Series  C-1960,  maturing 
November  15,  1960 

2}i  percent  Treasury  bonds  of  1960,  maturing  November  15,  1960 
The  amount  of  the  offering  under  this  circular  will  be  limited  to  the  amount  of 
maturing  certificates  and  bonds  tendered  in  exchange  and  accepted.     The  books 
will  be  open  only  on  October  31  through  November  2,  1960,  for  the  receipt  of 
subscriptions  for  this  issue. 


EXHIBITS  249 

2.  In  addition  to  the  oflFering  under  this  circular,  holders  of  the  maturing 
securities  are  also  ofTered  the  privilege  of  exchanging  all  or  any  part  of  such 
securities  for  ZYi  percent  Treasury  notes  of  Series  F-1962,  which  offering  is  set 
forth  in  Department  Circular  No.  1053,  issued  simultaneously  with  this  circular. 

II.  DESCRIPTION  OF  BONDS 

1.  The  bonds  will  be  dated  November  15,  1960,  and  will  bear  interest  from  that 
date  at  the  rate  of  3%  percent  per  annum,  payable  semiannually  on  May  15  and 
November  15  in  each  year  until  the  principal  amount  becomes  payable.  They 
will  mature  May  15,  1966,  and  will  not  be  subject  to  call  for  redemption  prior  to 
maturity. 

2.  The  income  derived  from  the  bonds  is  subject  to  all  taxes  imposed  under  the 
Internal  Revenue  Code  of  1954.  The  bonds  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. 

3.  The  bonds  will  be  acceptable  to  secure  deposits  of  public  moneys.  They 
will  not  be  acceptable  in  payment  of  taxes. 

4.  Bearer  bonds  with  interest  coupons  attached,  and  bonds  registered  as  to 
principal  and  interest,  will  be  issued  in  denominations  of  $500,  $1,000,  $5,000, 
$10,000,  $100,000,  and  $1,000,000.  Provision  will  be  made  for  the  interchange 
of  bonds  of  different  denominations  and  of  coupon  and  registered  bonds,  and  for 
the  transfer  of  registered  bonds,  under  rules  and  regulations  prescribed  by  the 
Secretary  of  the  Treasury. 

5.  The  bonds  will  be  subject  to  the  general  regulations  of  the  Treasury  Depart- 
ment, now  or  hereafter  prescribed,  governing  United  States  bonds. 

III.  SUBSCEIPTION  AND  ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches 
and  at  the  Office  of  the  Treasurer  of  the  United  States,  Washington,  D.C.  Bank- 
ing institutions  generally  may  submit  subscriptions  for  account  of  customers, 
but  only  the  Federal  Reserve  Banks  and  the  Treasury  Department  are  authorized 
to  act  as  official  agencies. 

2.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any 
subscription,  and  to  allot  less  than  the  amount  of  bonds  apphed  for;  and  any 
action  he  may  take  in  these  respects  shall  be  final.  Subject  to  these  reservations, 
all  subscriptions  will  be  allotted  in  full.  Allotment  notices  will  be  sent  out 
promptly  upon  allotment. 

IV.  PAYMENT 

1.  Payment  at  par  for  bonds  allotted  hereunder  must  be  made  on  or  before 
November  15,  1960,  or  on  later  allotment,  and  may  be  made  only  in  the  securities 
of  the  two  issues  enumerated  in  section  I  hereof,  which  will  be  accepted  at  par, 
and  should  accompany  the  subscription.  Coupons  dated  November  15,  1960, 
should  be  detached  from  the  maturing  securities  in  coupon  form  by  holders  and 
cashed  when  due.  In  the  case  of  registered  bonds,  final  interest  due  on  November 
15,  1960,  will  be  paid  by  check  drawn  in  accordance  with  the  assignments  on  the 
bonds  surrendered,  or  by  credit  in  any  account  maintained  by  a  banking  institu- 
tion with  the  Federal  Reserve  Bank  of  its  district. 

v.  ASSIGNMENT  OF  REGISTERED  BONDS 

1.  Treasury  bonds  of  1960  in  registered  form  tendered  in  payment  for  bonds 
offered  hereunder  should  be  assigned  by  the  registered  payees  or  assignees  thereof, 
in  accordance  with  the  general  regulations  of  the  Treasury  Department  governing 
assignments  for  transfer  or  exchange,  in  one  of  the  forms  hereafter  set  forth,  and 
thereafter  should  be  surrendered  with  the  subscription  to  a  Federal  Reserve 
Bank  or  branch  or  to  the  Office  of  the  Treasurer  of  the  United  States,  Washington, 
D.C.  The  bonds  must  be  delivered  at  the  expense  and  risk  of  the  holder.  If 
the  new  bonds  are  desired  registered  in  the  same  name  as  the  bonds  surrendered, 
the  assignment  should  be  to  "The  Secretary  of  the  Treasury  for  exchange  for 
3^  percent  Treasury  bonds  of  1966";  if  the  new  bonds  are  desired  registered  in 
another  name,  the  assignment  should  be  to  "The  Secretary  of  the  Treasury  for 
exchange  for  3%  percent  Treasury  bonds  of  1966  in  the  name  of "; 


250    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

if  new  bonds  in  coupon  form  are  desired,  the  assignment  should  be  to  "The  Sec- 
retary of  the  Treasury  for  exchange  for  3%  percent  Treasury  bonds  of  1966  in 
coupon  form  to  be  delivered  to ". 

VI.  GENERAL  PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up  to 
the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  bonds  allotted,  to  make  delivery  of  bonds  on  full-paid  subscriptions  allotted, 
and  they  may  issue  interim  receipts  pending  delivery  of  the  definitive  bonds. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time, 
prescribe  supplemental  or  amendatory  rules  and  regulations  governing  the 
offering,  which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

Robert  B.  Anderson, 
Secretary  of  the  Treasury. 


DEPARTMENT  CIRCULAR  NO.  1056.     PUBLIC  DEBT 

Treasury  Department, 
Washington,  November  18,  1960. 

I.    OFFERING    OF    BONDS 

1.  The  Secretary  of  the  Treasury,  pursuant  to  the  authority  of  the  Second 
Liberty  Bond  Act,  as  amended,  invites  subscriptions,  at  100}^  percent  of  their 
face  value  and  accrued  interest,  for  bonds  of  the  United  States,  designated  4 
percent  Treasury  bonds  of  1969,  in  exchange  for  a  like  face  amount  of  United 
States  savings  bonds  of  Series  F  and  G  maturing  in  the  calendar  j'^ear  1961, 
wiiich  will  be  accepted  at  exchange  values  set  forth  in  section  IV  hereof.  Hold- 
ers of  Series  F  and  G  bonds  aggregating  less  than  an  even  multiple  of  $500  ma- 
turity value  (the  lowest  denomination  of  new  bonds  available)  may  exchange 
such  bonds  with  payment  of  the  difference  in  cash  to  make  up  the  next  higher 
$500  multiple.  Interest  on  the  bonds  will  be  adjusted  as  of  December  15,  1960, 
as  set  forth  in  section  IV  hereof.  The  amount  of  the  offering  under  this  circular 
will  be  limited  to  the  amount  of  securities,  together  with  cash  adjustments, 
tendered  in  exchange  and  accepted.  The  books  will  be  open  only  on  November 
21  through  November  29  for  the  receipt  of  subscriptions  for  this  issue. 

II.    DESCRIPTION    OP    BONDS 

1.  The  bonds  now  offered  will  be  an  addition  to  and  Avill  form  a  part  of  the  4 
percent  Treasury  bonds  of  1969  issued  pursuant  to  Department  Circular  No.  996, 
dated  September  16,  1957,  will  be  freely  interchangeable  therewith,  and  are 
identical  in  all  respects  therewith  except  that  interest  on  the  bonds  to  be  issued 
under  this  circular  will  accrue  from  December  15,  1960.  Subject  to  the  pro- 
vision for  the  accrual  of  interest  from  December  15,  1960,  on  the  bonds  now 
offered,  the  bonds  are  described  in  the  following  quotation  from  Department 
Circular  No.  996: 

"1.  The  bonds  will  be  dated  October  1,  1957,  and  will  bear  interest  from  that 
date  at  the  rate  of  4  percent  per  annum,  payable  semiannually  on  April  1  and 
October  1  in  each  year  until  the  principal  amount  becomes  payable.  They  wiU 
mature  October  1,  1969,  and  will  not  be  subject  to  call  for  redemption  prior  to 
maturity. 

"2.  The  income  derived  from  the  bonds  is  subject  to  all  taxes  imposed  under 
the  Internal  Revenue  Code  of  1954.  The  bonds  are  subject  to  estate,  inheritance, 
gift,  or  other  excise  taxes,  w^hether  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. 

"3.  The  bonds  will  be  acceptable  to  secure  deposits  of  public  moneys. 

"4.  Bearer  bonds  with  interest  coupons  attached,  and  bonds  registered  as  to 
principal  and  interest,  will  be  issued  in  denominations  of  $500,  $1,000,  $5,000, 
$10,000,  $100,000,  and  $1,000,000.     Provision  will  be  made  for  the  interchange 


EXHIBITS  251 

of  bonds  of  different  denominations  and  of  coupon  and  registered  bonds,  and  for 
the  transfer  of  registered  bonds,  under  rules  and  regulations  prescribed  by  the 
Secretary  of  the  Treasury. 

"5.  Any  bonds  issued  hereunder  which  upon  the  death  of  the  owner  constitute 
part  of  his  estate,  will  be  redeemed  at  the  option  of  the  duly  constituted  repre- 
sentatives of  the  deceased  owner's  estate,  at  par  and  accrued  interest  to  date  of 
payment,'  ■provided: 

(a)  that  the  bonds  were  actually  owned  by  the  decedent  at  the  time  of  his 
death;  and 

(6)   that  the  Secretary  of  the  Treasury  be  authorized  to  apply  the  entire 
proceeds  of  redemption  to  the  payment  of  Federal  estate  taxes. 

Registered  bonds  submitted  for  redemption  hereunder  must  be  duly  assigned 
to  "The  Secretary  of  the  Treasury  for  redemption,  the  proceeds  to  be  paid  to  the 

District  Director  of  Internal  Revenue  at for  credit  on  Federal  estate 

taxes  due  from  estate  of "     Owing  to  the  periodic  closing  of  the 

transfer  books  and  the  impossibility  of  stopping  payment  of  interest  to  the  regis- 
tered owner  during  the  closed  period,  registered  bonds  received  after  the  closing 
of  the  books  for  payment  during  such  closed  period  will  be  paid  only  at  par  with 
a  deduction  of  interest  from  the  date  of  payment  to  the  next  interest  payment 
date;  ^  bonds  received  during  the  closed  period  for  payment  at  a  date  after  the 
books  reopen  will  be  paid  at  par  plus  accrued  interest  from  the  reopening  of  the 
books  to  the  date  of  payment.  In  either  case  checks  for  the  full  six  months' 
interest  due  on  the  last  day  of  the  closed  period  will  be  forwarded  to  the  owner 
in  due  course.  All  bonds  submitted  must  be  accompanied  by  Form  PD  1782,^ 
properly  completed,  signed,  and  sworn  to,  and  by  proof  of  the  representatives' 
authority  in  the  form  of  a  court  certificate  or  a  certified  copy  of  the  representatives' 
letters  of  appointment  issued  by  the  court.  The  certificate,  or  the  certification 
to  the  letters,  must  be  under  the  seal  of  the  court,  and  except  in  the  case  of  a 
corporate  representative,  must  contain  a  statement  that  the  appointment  is  in 
full  force  and  be  dated  within  six  months  prior  to  the  submission  of  the  bonds, 
unless  the  certificate  or  letters  show  that  the  appointment  was  made  within  one 
year  immediately  prior  to  such  submission.  Upon  payment  of  the  bonds  appro- 
priate memorandum  receipt  will  be  forwarded  to  the  representatives,  which  will 
be  followed  in  due  course  by  formal  receipt  from  the  District  Director  of  Internal 
Revenue. 

"6.  The  bonds  will  be  subject  to  the  general  regulations  of  the  Treasury  De- 
partment, now  or  hereafter  prescribed,  governing  United  States  bonds." 

III.    SUBSCRIPTION    AND    ALLOTMENT 

1.  Subscriptions  will  be  received  at  the  Federal  Reserve  Banks  and  branches 
and  at  the  Office  of  the  Treasurer  of  the  United  States,  Washington,  D.C.  Bank- 
ing institutions  generally,  and  paying  agents  eligible  to  process  bonds  under 
Treasury  Department  Circular  No.  888,  Revised,  may  submit  exchange  sub- 
scriptions for  account  of  customers,  but  only  the  Federal  Reserve  Banks  and  the 
Treasury  Department  are  authorized  to  act  as  official  agencies. 

2.  The  Secretary  of  the  Treasury  reserves  the  right  to  reject  or  reduce  any 
subscription,  and  to  allot  less  than  the  amount  of  bonds  applied  for;  and  any 
action  he  may  take  in  these  respects  shall  be  final.  Subject  to  these  reservations, 
all  subscriptions  will  be  allotted  in  full.  Allotment  notices  will  be  sent  out 
promptly  upon  allotment. 

IV.    PAYMENT 

1.  Payment  for  the  face  amount  of  bonds  allotted  hereunder  must  be  made  on 
or  before  December  15,  1960,  or  on  later  allotment,  and  may  be  made  only  in  a 
like  face  amount  of  United  States  savings  bonds  of  Series  F  and  Series  G  maturing 
from  January  1  to  December  1,  1961,  inclusive,  and  any  cash  difference  necessary 
to  make  up  an  even  $500  multiple,  which  bonds  and  cash  should  accompany  the 
subscription,  together  with  the  net  amount  to  be  collected  from  the  subscriber 


'  An  exact  half-year's  interest  is  computed  for  each  full  half-year  period  irrespective  of  the  actual  number 
of  diiys  in  the  half  year.  For  a  fractional  part  of  any  half  year,  computation  is  on  the  basis  of  the  actual 
number  of  days  in  such  half  year. 

2  The  transfer  books  are  closed  from  March  2  to  April  1,  and  from  September  2  to  October  I  (both  dates 
inclusive)  in  each  year. 

3  Copies  of  Form  PD  1782  may  be  obtained  from  any  Federal  Reserve  Bank  or  from  the  Treasury 
Department,  Washington,  D.C. 

614359—62 17 


252   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

as  set  forth  in  tables  I  and  II  hereof.  The  Series  F  and  G  bonds  will  be  accepted 
in  the  exchange  at  amounts  set  forth  hereunder  for  their  respective  months  of 
maturity.  These  exchange  values  are  higher  than  present  redemption  values. 
They  have  been  set  so  that  holders  of  Series  F  and  G  bonds  who  elect  to  accept 
this  exchange  offer  will  receive,  in  effect,  an  investment  yield  approximately  1 
percent  per  annum  more  than  would  otherwise  accrue  from  December  15,  1960, 
to  the  maturity  dates  of  their  bonds,  and  will  receive  an  investment  yield  of 
approximately  3.93  percent  on  the  4  percent  marketable  bonds  received  in  ex- 
change for  the  period  from  the  maturity  dates  of  their  Series  F  and  G  bonds  to 
October  1,  1969.  All  subscribers  will  be  charged  the  interest  from  October  1, 
1960,  to  December  15,  1960  ($0.82  per  $100),  on  the  bonds  allotted.  Other 
adjustments  with  respect  to  bonds  accepted  in  exchange  will  be  made  as  set 
forth  in  tables  I  and  II  hereof,  which  also  show  the  net  amounts  to  be  collected 
from  subscribers  for  each  $100  (face  amount)  of  bonds  accepted  in  exchange. 

(a)  Series  F  bonds. — The  exchange  values  of  Series  F  bonds,  the  differences 
between  such  values  and  the  offering  price  of  the  4  percent  bonds,  the  interest 
which  will  accrue  on  the  new  bonds  and  the  total  amounts  to  be  collected  from 
holders  of  Series  F  bonds  per  $100  (face  amount)  are  as  follows: 

Table  I. — For  Series  F  bonds 


Total  amounts 

Charge  for  dif- 

Interest Oct.  1 

TO  BE  COL- 

ferences between 

to  Dec.  15,  19o0, 

LECTED 

Exchange  values 

$100.50  (offering 

to  be  charged  on 

FH().M  SITB- 

F  bonds  maturing  in  1961 

of  F  bonds  per 

price  per  $100  of 

new  bonds  per 

SCKIBER,'^ 

on  the  first  clay  of— 

$100  (face  amt.) 

new  bonds)  and 

$100  (face  amt.) 

per  $100  (face 

exchange  values 

of  F  bonds 

amt.)  of  F  bonds 

of  F  bonds 

accepted 
(Cols.  2  plus  3)  " 

Col.  1 

Col.  2 

Col.  3 

Col.  4 

January    

$99. 88 

$0.62 

$0.82 

$1.44 

February 

99.64 

0.86 

0.82 

1.68 

March. 

99.40 
99.16 

1.10 
1.34 

0.82 
0.82 

1.92 

April 

2.16 

May. 

98.92 
98.68 
98.44 

1.58 
1.82 
2.06 

0.82 
0.82 
0.82 

2.40 

June - 

2.64 

July 

2.88 

August 

98.20 

2.30 

0.82 

3.12 

September- 

97.96 

2.54 

0.82 

3.36 

October 

97.72 

2.78 

0.82 

3.60 

November 

97.48 

3.02 

0.82 

3.84 

December 

97.24 

3.26 

0.82 

4.08 

1  In  addition,  for  each  .$100,  or  multiple  or  fraction  thereof,  between  the  face  amount  of  Series  F  bonds 
submitted  and  the  face  amount  of  bonds  subscribed  (to  next  higher  multiple  of  $500)  the  subscriber  must 
pay  $101.32  ($100.50  issue  price  plus  $0.82  accrued  interest). 

(b)  Series  G  bonds. — The  exchange  values  of  Series  G  bonds,  the  differences 
between  such  values  and  the  offering  price  of  the  4  percent  bonds,  the  accrued 
interest  to  be  credited  on  the  Series  G  bonds,  the  interest  which  will  accrue  on 
the  new  bonds  and  the  total  amounts  to  be  collected  from  holders  of  Series  G 
bonds  per  $100  (face  amount) ;  see  table  II. 

2.  Any  qualified  depositary  will  be  permitted  to  make  payment  by  credit  in 
its  Treasury  tax  and  loan  account  for  any  cash  payments  authorized  or  required 
to  be  made  under  this  circular  for  bonds  allotted  to  it  for  itself  and  its  customers 
up  to  any  amount  for  which  it  shall  be  qualified  in  excess  of  existing  deposits, 
when  so  notified  by  the  Federal  Reserve  Bank  of  its  district. 

3.  Series  F  and  G  bonds  tendered  in  exchange  must  bear  appropriate  requests 
for  payment  in  accordance  with  the  provisions  of  Treasury  Department  Circular 
No.  530,  Eighth  Revision,  as  amended,  or  the  special  endorsements  provided  for 
in  Treasury  Department  Circular  No.  888,  Revised.  In  any  case  in  which  bonds 
in  bearer  form,  or  registered  bonds  in  another  name,  are  desired,  requests  for 
payment  must  be  supplemented  by  specific  instructions  signed  by  the  owner  who 
signed  the  request  for  payment.  An  owner's  instructions  for  bearer  or  registered 
bonds  may  be  recorded  on  the  surrendered  bonds  by  typing  or  otherwise  recording 
on  the  back  thereof,  or  by  changing  the  existing  request  for  payment  form  to 
conform  to  one  of  the  two  following  forms: 


EXHIBITS 


253 


(a)  I  aiij  the  owner  of  this  bond  and  hereby  request  exchange  for  4%  Treasury 
bonds  of  1969  m  bearer  form  to  be  delivered  to  (insert  name  and  address  of  person 
to  whom  deliv.M-y  is  to  be  made). 

(b)  I  am  the  owner  of  this  bond  and  hereby  request  exchange  for  4  %  Treasury 
bonds  of  1969  registered  in  the  name  of  (insert  exact  registration  desired — see 
section  V  hereof). 

Table  II. — For  Series  G  bo7ids 


Total  amounts 

Charge  for 

Interest  Oct.  1 

TO  BE  COL- 

differences be- 

to Dec.  15, 1960, 

LECTED 

Exthangp 

tween  $100.50 

Interest  to  be 

to  be  charged 

FROM  SUB- 

Q bonds  maturing 

values  of  G 

(offering  price 

credited  on  O 

on  new  bonds 

SCRIBERS 

in  1961  on  the 

bonds  per  $100 

I)er$100ofnew 

bonds  per  $100 

per  $100  (face 

per  $100  (face 

first  day  of— 

(faceamt.) 

bonds)  and  ex- 

(face amt.) 

amt.)  of  G 

amt.)  of  G 

change  values 

bonds 

bonds  accepted' 

of  Q  bonds 

(Cols.  2  and  4 
minus  3) 

Col.  1 

Col.  2 

Col.  3 

Col.  4 

Col.  5 

January 

.$99.  98 

$0.  52 

$1.15 

$0.82 

.$0. 19 

February 

99.94 

0.56 

0.94 

0.82 

0.44 

March _      _  _ 

99.91 

0.  .TO 

0.73 

0.82 

0.68 

April 

99.87 

0,63 

0.52 

0.82 

0.93 

May. 

99.83 
99.80 
99.77 
99.73 

0.67 
0.70 
0.73 
0.77 

0.31 
0.10 

0.94 

0.82 
0.82 
0.82 
0.82 

1.18 

.Tune      

1.42 

July 

1.65 

August 

0.65 

September 

99.  70 

0.80 

0.73 

0.82 

0.89 

October 

99.  66 

0.84 

0.52 

0.82 

1.14 

November 

99.63 

0.87 

0.31 

0.82 

1.38 

December.    

99.59 

0.91 

0.10 

0.82 

1.63 

1  In  addition,  for  each  $100,  or  multiple  thereof,  between  the  face  amount  of  Series  G  bonds  submitted  and 
the  face  amoimt  of  bonds  subscribed  (to  next  higher  multiple  of  $500)  the  subscriber  must  pay  $101.32  ($100.50 
issue  price  plus  $0.82  accrued  interest). 

»  Interest  will  be  paid  to  January  1,  1961,  on  bonds  maturing  July  1, 1961,  in  regular  course  on  January  1, 
1961,  by  checks  mailed  by  the  Treasury  Department,  .^.s  these  checks  will  include  unearned  interest  for  the 
period  from  December  15,  1960,  to  January  1, 1961,  each  subscriber  who  tenders  these  bonds  will  be  required 
to  make  an  interest  refund  of  $0.10  per  $100  (face  amount).  The  above  amount  of  $1.65  in  col.  5  includes 
such  refund. 

V.    REGISTRATION    OF    BONDS 

1.  Treasury  bonds  may  be  registered  only  as  authorized  in  Treasury  Depart- 
ment Circular  No.  300,  Revised,  as  supplemented.  Registration  in  the  name  of 
one  person  payable  on  death  to  another  is  not  authorized.  Registered  Treasury 
bonds  may  be  transferred  to  a  purchaser  only  upon  proper  assignment.  Treasury 
bonds  registered  in  the  form  "A  or  B"  may  be  transferred  only  upon  assignment 
by  or  on  behalf  of  both,  except  that  if  one  of  them  is  deceased,  an  assignment  by 
or  on  behalf  of  the  survivor  will  be  accepted.  Since  Treasury  bonds  are  not 
redeemable  before  maturity  at  the  option  of  the  owners,  the  effects  of  registering 
them  in  the  names  of  two  or  more  persons  are  important.  Information  concerning 
the  effects  of  various  forms  of  registration  may  be  obtained  from  any  Federal 
Reserve  Bank  or  branch,  the  Office  of  the  Treasurer  of  the  United  States,  Wash- 
ington, D.C.,  or  from  banking  institutions  generally. 


VI.    GENERAL    PROVISIONS 

1.  As  fiscal  agents  of  the  United  States,  Federal  Reserve  Banks  are  authorized 
and  requested  to  receive  subscriptions,  to  make  allotments  on  the  basis  and  up 
to  the  amounts  indicated  by  the  Secretary  of  the  Treasury  to  the  Federal  Reserve 
Banks  of  the  respective  districts,  to  issue  allotment  notices,  to  receive  payment 
for  bonds  allotted,  to  make  delivery  of  bonds  on  full-paid  subscriptions  allotted, 
and  they  may  issue  interim  receipts  pending  delivery  of  the  definitive  bonds. 

2.  The  Secretary  of  the  Treasury  may  at  any  time,  or  from  time  to  time, 
prescribe  supplemental  or  amendatory  rules  and  regulations  governing  the  offer- 
ing, which  will  be  communicated  promptly  to  the  Federal  Reserve  Banks. 

Julian  B.  Baird, 
Acting  Secretary  of  the  Treasury. 


254   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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258   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Treasury  Bills  Offered  and  Accepted 
Exhibit  4. — Treasury  bills 

During  the  fiscal  year  1961  there  were  52  weekly  issues  each  of  13-week  and 
26-week  Treasury  bills  (the  13-week  bills  represent  additional  issues  of  bills 
with  an  original  maturity  of  26  weeks),  3  issues  of  tax  anticipation  series,  4  other 
issues  (one  364-day  and  three  365-day  bills),  and  one  issue  of  a  strip  of  weekly 
bills  issued  June  14,  1961,  representing  additional  amounts  of  18  series  of  out- 
standing Treasury  bills.  Four  press  releases  inviting  tenders  and  four  releases 
announcing  the  acceptance  of  tenders  are  reproduced  in  this  exhibit.  The  press 
releases  of  June  7  and  June  13,  1961,  are  in  a  form  representative  of  a  weekly 
double  issue  of  regular  bills  (91-  and  182-day)  in  which  there  is  an  additional 
issue  of  a  currently  outstanding  issue  of  182-day  bills  having  91  days  remaining 
before  maturity  and  a  new  issue  of  182-day  bills.  The  details  of  the  issue  of 
strip  bills  are  explained  in  the  releases  of  June  2  and  June  9,  1961.  The  tax 
anticipation  series  is  represented  by  the  releases  of  March  23  and  March  29, 
1961,  and  the  other  bill  issues  are  represented  by  the  releases  of  April  6  and 
April  13,  1961.  The  essential  details  regarding  each  issue  of  Treasury  bills 
during  the  fiscal  year  1961  are  summarized  in  the  table  following  the  releases. 

PRESS  RELEASE  OF  JUNE  7,  1961 

The  Treasury  Department,  by  this  public  notice,  invites  tenders  for  two  series 
of  Treasury  bills  to  the  aggregate  amount  of  $1,600,000,000,  or  thereabouts, 
for  cash  and  in  exchange  for  Treasury  bills  maturing  June  15,  1961,  in  the  amount 
of  $1,601,254,000,  as  follows: 

91-day  bills  (to  maturity  date)  to  be  issued  June  15,  1961,  in  the  amount 
of  $1,100,000,000,  or  thereabouts,  representing  an  additional  amount  of  bills 
dated  March  16,  1961,  and  to  mature  September  14,  1961,  originally  issued 
in  the  amount  of  $600,004,000  (including  $100,000,000  to  be  issued  June  14, 
1961),  the  additional  and  original  bills  to  be  freely  interchangeable. 

182-day  bills,  for  $500,000,000,  or  thereabouts,  to  be  dated  June  15,  1961, 
and  to  mature  December  14,  1961. 

The  bills  of  both  series  will  be  issued  on  a  discount  basis  under  competitive 
and  noncompetitive  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,  $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  o'clock  p.m.,  eastern  daylight  saving  time,  Monday, 
June  12,  1961.  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. 

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  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  incor- 
porated 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  Secretary  of  the  Treasury  expressly  reserves  the  right  to  accept  or  reject 


EXHIBITS 


259 


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  $200,000  or 
less  for  the  additional  bills  dated  March  16,  1961  (91-days  remaining  until 
maturity  date  on  September  14,  1961),  and  noncompetitive  tenders  for  $100,000 
or  less  for  the  182-day  bills  without  stated  price  from  any  one  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 
15,  1961,  in  cash  or  other  immediately  available  funds  or  in  a  like  face  amount 
of  Treasury  bills  maturing  June  15,  1961.  Cash  and  exchange  tenders  will  re- 
ceive 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  prin- 
cipal 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  con- 
sidered 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  here- 
under 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,  Revised,  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  or  branch. 


PRESS  RELEASE  OF  JUNE  13,  1961 

The  Treasury  Department  announced  last  evening  that  the  tenders  for  two 
series  of  Treasury  bills,  one  series  to  be  an  additional  issue  of  the  bills  dated 
March  16,  1961,  and  the  other  series  to  be  dated  June  15,  1961,  which  were 
offered  on  June  7,  were  opened  at  the  Federal  Reserve  Banks  on  June  12.  Tenders 
were  invited  for  $1,100,000,000,  or  thereabouts,  of  91-day  bills  and  for  $500,- 
000,000,  or  thereabouts,  of  182-day  bills.  The  details  of  the  two  series  are  as 
follows: 


Range  of  accepted  competitive  bids 

91-day  Treasury  bills  matur- 
ing September  14,  1961 

182-day  Treasury  biUs  matur- 
ing December  14, 1961 

Price 

Approximate 
equivalent 
annual  rate 

Price 

Approximate 
equivalent 
annual  rate 

High 

99. 428 
99. 41S 
99.420 

2.  263% 

2. 314% 

1  2.  295% 

98.  756 
98.  736 
98.  740 

2. 461% 

Low .  . 

2  500% 

Average 

>  2. 492% 

(36  percent  of  the  amount  of  91-day  bills  bid  for  at  the  low  price  was  accepted  and  71  percent  of  the  amount 
of  182-day  bills  bid  for  at  the  low  price  was  accepted.) 


260        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
Total  tenders  applied  for  and  accepted  by  Federal  Reserve  districts 


District 


Applied  for 


Accepted 


Applied  for 


Accepted 


Boston 

New  York 

Philadelphia.. 

Cleveland 

Richmond 

Atlanta.- 

Chicago 

St.  Louis 

Minneapolis.. 
Kansas  City.. 

Dallas 

San  Francisco 

Total... 


$30, 462, 000 

1,458,146,000 

25,  593, 000 

33, 945, 000 

9, 798, 000 

23,  392, 000 

210, 848, 000 
23, 817, 000 
20, 023, 000 
35,  962, 000 
11, 191, 000 
75,  274, 000 


$10, 

689, 

10, 

33, 

9, 
18, 
175, 
20, 
19, 
32, 
11, 


397, 000 
363, 000 
168, 000 
401,000 

748, 000 
467, 000 
278, 000 
267, 000 
523. 000 
962,  000 
191, 000 
674, 000 


$3, 175, 000 

934,341,000 

8, 997, 000 

22, 181, 000 
1,561,000 
3, 864, 000 

91,556,000 
6,  668, 000 
6,  667, 000 

12,  540, 000 
3, 427, 000 

49, 235, 000 


$2, 325, 000 

360,123,000 

3, 952, 000 

19,156,000 
1,211,000 
3, 310, 000 

52,  451, 000 
5, 450, 000 
4, 937, 000 
7, 337, 000 
3,  267, 000 

37, 085, 000 


1,958,451,000 


2 1, 100, 439, 000 


1,144,212,000 


3  500, 604, 000 


1  On  a  coupon  issue  of  the  same  length  and  for  the  same  amoimt  invested,  the  return  on  these  bills  would 
provide  yields  of  2.34%,  for  the  91-day  bills,  and  2.56%,  for  the  182.day  biUs.  Interest  rates  on  hills  are  quoted 
in  terms  of  bank  discount  with  the  return  related  to  the  face  amount  of  the  bills  payable  at  matui'ity  rather 
than  the  amoimt  invested  and  their  length  in  actual  number  of  days  related  to  a  360-day  year.  In  contrast, 
yields  on  certificates,  notes,  and  bonds  are  computed  in  terms  of  interest  on  the  amount  invested,  and  relate 
the  number  of  days  remaining  m  an  interest  payment  period  to  the  actual  number  of  days  in  the  period,  with 
semiaimual  compounding  if  more  than  one  coupon  period  is  involved. 

2  Includes  $205,903,000  noncompetitive  tenders  accepted  at  the  average  price  of  99.420. 

3  Includes  $50,752,000  noncompetitive  tenders  accepted  at  the  average  price  of  98.740. 


PRESS  RELEASE  OF  JUNE  2,  1961 

_  The  Treasury  Department,  by  this  public  notice,  invites  tenders  for  addi- 
tional amounts  of  eighteen  series  of  Treasury  bills  to  an  aggregate  amount  of 
$1,800,000,000,  or  thereabouts,  for  cash.  The  additional  bills  will  be  issued 
June  14,  1961,  will  be  in  the  amounts,  and  will  be  in  addition  to  the  bills  originally 
issued  and  maturing,  as  follows: 


Amount  of 

additional 

issue 

Original  issue  dates  1961 

Maturity  dates  1961 

Days  from 
June  14,  1961, 
to  maturity 

Amount 
outstanding 
(in  millions) 
June  2, 1961 

$100, 000, 000 

Feb.  2 

Aug.  3        

50 
57 
64 
71 
78 
85 
92 
99 
106 
113 
121 
127 
134 
141 
148 
155 
163 
169 

$1,  601 
1  601 

100, 000, 000 

Feb.  9....  

Aug.  10 

100, 000, 000 

Feb.  16 

Aug.  17 

1  600 

100, 000, 000 

Feb.  23 

Aug.  24              

1  600 

100,000,000 

Mar.  2 

Aug.  31  

1,501 

100, 000, 000 

Mar.  9 

Sept.  7 

500 

100, 000, 000 

Mar.  16 

Sept.  14 

500 

100, 000, 000 

Mar.  23 

Sept  21 

500 

100, 000, 000 

Mar.  30 

Sept.  28 

500 

100,000,000 

Apr.  6 

Oct.  5 

500 

100, 000, 000 

Apr.  13.. ._ 

Oct.  13. 

500 

100, 000, 000 

Apr.  20.... 

Oct.  19  . 

400 

100, 000, 000 

Apr.  27.... - 

Oct.  26 

400 

100, 000, 000 

May  4  ..  

Nov.  2 

500 

100, 000, 000 

May  11 

Nov.  9    ..  . 

500 

100.000,000 

May  18 

Nov.  16      

501 

100, 000, 000 

May  25 

Nov.  24 

500 

100,000,000 

June  1 

Nov.  30 

500 

1,800,000,000 

The  additional  and  original  bills  will  be  freely  interchangeable. 

Each  tender  submitted  must  be  in  the  amount  of  $18,000  or  an  even  multiple 
thereof,  and  the  amount  tendered  will  be  applied  to  each  of  the  above  series  of 
bills  on  the  basis  of  the  ratio  of  each  series  to  the  total  of  all  series.  (For  example, 
an  accepted  tender  for  $90,000  will  be  applied  $5,000  to  the  issue  with  original 
date  of  February  2,  1961,  and  $5,000  to  each  of  the  additional  weekly  issues 
through  the  issue  with  original  date  of  June  1,  1961.) 

The  bills  offered  hereunder  will  be  issued  on  a  discount  basis  under  competitive 
and  noncompetitive  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,  $100,000,  $500,000,  and 
$1,000,000  (maturity  value). 


EXHIBITS  261 

Tenders  will  be  received  at  Federal  Reserve  Banks  and  branches  up  to  the 
closing  hour,  one-thirty  o'clock  p.m.,  eastern  daylight  saving  time,  June  8,  1961. 
Tenders  will  not  be  received  at  the  Treasury  Department,  Washington.  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.  A  single  price  must  be  submitted  for  each  unit  of  $18,000,  or  even  multiple 
thereof.  A  unit  represents  $1,000  face  amount  of  each  issue  of  bills  offered 
hereunder,  as  previously  described.  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  and  branches  on  apphcation  therefor. 

Others  than  banking  institutions  will  not  be  permitted  to  submit  tenders 
except  for  their  own  account.  Tenders  will  be  received  without  deposit  from  in- 
corporated banks  and  trust  companies  and  from  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  apphed  for,  unless  the 
tenders  are  accompanied  by  an  express  guaranty  of  payment  by  an  incorporated 
bank  or  trust  company. 

Immediately  after  the  closing  hours,  tenders  will  be  opened  at  the  Federal  Re- 
serve 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  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.  Noncompetitive  tenders  for  $180,000  or  less  (in  even  multiples  of  $18,000) 
without  stated  price  from  any  one  bidder  will  be  accepted  in  full  at  the  average 
price  (in  three  decimals)  of  accepted  competitive  bids,  provided,  however,  that 
if  the  total  of  noncompetitive  tenders  exceeds  $900,000,000,  the  Secretary  of  the 
Treasury  reserves  the  right  to  allot  less  than  the  amount  applied  for  on  a  straight 
percentage  basis  with  adjustments  where  necessary  to  the  next  higher  multiple 
of  $18,000.  Settlement  for  accepted  tenders  in  accordance  with  the  bids  must 
be  made  or  completed  at  the  Federal  Reserve  Bank  in  cash  or  other  immediately 
available  funds  on  June  14,  1961,  provided,  however,  any  qualified  depositary 
'nill  be  permitted  to  make  payment  by  credit  in  its  Treasury  tax  and  loan  account 
for  Treasury  bills  allotted  to  it  for  itself  and  its  customers  up  to  any  amount 
for  which  it  shall  be  qualified  in  excess  of  existing  deposits  when  so  notified  by 
the  Federal  Reserve  Bank  of  its  district. 

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  dis- 
count at  which  Treasury  bills  are  originally  sold  by  the  United  States  is 
considered  to  be  interest.  Under  section  454(b)  and  1221(5)  of  the  Internal  Rev- 
enue 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  other- 
wise 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  be- 
tween 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,  Revised,  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  or  branch. 

PRESS  RELEASE  OF  JUNE  9,  1961 

The  Treasury  Department  announced  last  evening  that  tenders  for  additional 
amounts  of  eighteen  series  of  Treasury  bills  to  an  aggregate  amount  of  $1,800,- 
000,000,  or  thereabouts,  to  be  issued  June  14,  1961,  which  were  offered  on  June  2, 
were  opened  at  the  Federal  Reserve  Banks  on  June  8.  The  amount  of  accepted 
tenders  will  be  equally  divided  among  the  eighteen  regular  weekly  issues  of  out- 


262   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


standing  Treasury  bills  maturing  August  3,  1961,  to  November  30,  1961,  inclusive. 
The  details  of  the  offering  are  as  follows: 

Total  applied  for $4,671,774,000 

Total  accepted  (includes  $187,842,000  entered  on  a  noncompeti- 
tive basis  and  accepted  in  full  at  the  average  price  shown  below)  _     1,  800,  972,  000 


Range  of  accepted  competive  bids 


Price 


Approximate  equivalent  annual  rate  of  dis- 
count based  on  109.6  days  (average  num- 
ber of  days  to  maturity) 


High... 

Low 

Average 


99.  305 
99.  292 
99. 297 


2. 283% 

2.  326% 

»  2. 308% 


(44  percent  of  the  amount  bid  for  at  the  low  price  was  accepted) 

Total  tenders  applied  for  and  accepted  by  Federal  Reserve  districts 


District 

Applied  for 

Accepted 

Boston 

$176,148,000 
2,  293,  254.  000 
163,  926, 000 
355, 050, 000 
117,144,000 
128,  322, 000 
482,  526. 000 

87,  930, 000 
121,194,000 

80, 046, 000 
267,516,000 
398,718,000 

$83  628  000 

New  York 

652,  176  000 

Philadelphia        

65  844  000 

Cleveland .. 

153  810  000 

Richmond 

33,  840. 000 

Atlanta... ._ 

55  296  000 

Chicago  

362  142,000 

St.  Louis - 

31,374.000 

Minneapolis 

72  144  000 

Kansas  City 

40, 212  000 

Dallas - 

157,  176.000 

Ran  Francisco 

93, 330, 000 

Total 

4, 671, 774, 000 

1,800,972,000 

'  On  a  coupon  issue  of  the  same  length  as  the  average  for  the  bills  and  for  the  same  amount  invested,  the 
return  on  these  bills  would  provide  a  yield  of  2.36%.  Interest  rates  on  bills  are  quoted  in  terms  of  bank 
discount  with  the  return  related  to  the  face  amount  of  the  bills  payable  at  maturity  rather  than  the  amount 
invested  and  their  length  in  actual  number  of  days  related  to  a  360-day  year.  In  contrast,  yields  on  cer- 
tificates, notes,  and  bonds  are  computed  in  terms  of  interest  on  the  amount  invested,  and  relate  the  number 
of  days  remaining  in  an  interest  payment  period  to  theactualnumberof  days  in  the  period,  with  semiannual 
compounding  if  more  than  one  coupon  period  is  involved. 

PRESS  RELEASE  OF  MARCH  23,  1961 

The  Treasury  Department,  by  this  public  notice,  invites  tenders  for  $1,500, 
000,000,  or  thereabouts,  of  172-day  Treasury  bills,  to  be  issued  on  a  discount  basis 
under  competitive  and  noncompetitive  bidding  as  hereinafter  provided.  The 
bills  of  this  series  will  be  designated  tax  anticipation  series,  they  will  be  dated 
April  3,  1961,  and  they  will  mature  September  22,  1961.  They  will  be  accepted 
at  face  value  in  payment  of  income  and  profits  taxes  due  on  September  15,  1961, 
and  to  the  extent  they  are  not  presented  for  this  purpose  the  face  amount  of  these 
bills  will  be  payable  without  interest  at  maturity.  Taxpayers  desiring  to  apply 
these  bills  in  payment  of  September  15,  1961,  income  and  profits  taxes  have  the 
privilege  of  surrendering  them  to  any  Federal  Reserve  Bank  or  branch  or  to  the 
Office  of  the  Treasurer  of  the  United  States,  Washington,  not  more  than  fifteen 
days  before  September  15,  1961,  and  receiving  receipts  therefor  showing  the  face 
amount  of  the  bills  so  surrendered.  These  receipts  may  be  submitted  in  lieu  of 
the  bills  on  or  before  September  15,  1961,  to  the  District  Director  of  Internal 
Revenue  for  the  district  in  which  such  taxes  are  payable.  The  bills  will  be  issued 
in  bearer  form  only,  and  in  denominations  of  $1,000,  $5,000,  $10,000,  $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  o'clock  p.m.,  eastern  standard  time,  Tuesday,  March  28, 
1961.  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  competi- 
tive 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. 

Others  than  banking  institutions  will  not  be  permitted  to  submit  tenders  except 
for  their  own  account.     Tenders  will  be  received  without  deposit  from  incorpo- 


EXHIBITS  263 

rated  banks  and  trust  companies  and  from  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. 

All  bidders  are  required  to  agree  not  to  purchase  or  to  sell,  or  to  make  any 
agreements  with  respect  to  the  purchase  or  sale  or  other  disposition  of  any  bills 
of  this  issue,  until  after  one-thirty  o'clock  p.m.,  eastern  standard  time,  Tuesday, 
March  28,  1961. 

Immediately  after  the  closing  hour,  tenders  will  be  opened  at  the  Federal  Re- 
serve 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  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  $300,000  or  less  without 
stated  price  from  any  one  bidder  will  be  accepted  in  full  at  the  average  price  (in 
three  decimals)  of  accepted  competitive  bids.  Payment  of  accepted  tenders  at 
the  prices  offered  must  be  made  or  completed  at  the  Federal  Reserve  Bank  in 
cash  or  other  immediately  available  funds  on  April  3,  1961,  provided,  however, 
any  qualified  depositary  will  be  permitted  to  make  payment  by  credit  in  its 
Treasury  tax  and  loan  account  for  not  more  than  50  percent  of  the  amount  of 
Treasury  bills  allotted  to  it  for  itself  and  its  customers  up  to  any  amount  for  which 
it  shall  be  qualified  in  excess  of  existing  deposits  when  so  notified  by  the  Federal 
Reserve  Bank  of  its  district. 

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  sub- 
ject 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  con- 
sidered 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,  Revised,  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  or  branch. 

PRESS  RELEASE7)]F1iARCH  29,   1961 
The    Treasury    Department    announced    last    evening    that    the    tenders    for 
$1,500,000,000,  or  thereabouts,  of  tax  anticipation  series  172-day  Treasury  bills 
to  be  dated  April  3  and  to  mature  September  22,  1961,  which  were  offered  on 
March  23,  were  opened  at  the  Federal  Reserve  Banks  on  March  28. 
The  details  of  this  issue  are  as  follows: 

Total  applied  for $3,894,635,000 

Total  accepted   (includes  $218,935,000  entered  on  a  non- 
competitive basis  and  accepted  in  full  at  the  average 

price  shown  below) 1,  501,  150,  000 

Range  of  accepted  competitive  bids  (excepting  three  tenders 
totaling  $1,900,000) : 

High,     equivalent    rate     of    discount     approximately 

2.380%  per  annum 98.  863 

Low,  equivalent  rate  of  discount  approximately  2.491% 

per  annum 98.  810 

Average,   equivalent   rate   of   discount   approximately 

2.473%  per  annum  i_-    98.818 

(47  percent  of  the  amount  bid  for  at  the  low  price  was 
accepted) 
Footnote  on  following  page. 


264   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Federal  Reserve  district 


Total  applied 
for 


Total  accepted 


Boston. 

New  York 

Philadelphia.. 

Cleveland 

Richmond 

Atlanta 

Chicago 

St.  Louis 

Minneapolis... 
Kansas  City... 

Dallas 

San  Francisco. 


$213, 

1,  689, 

186, 

379, 

69, 

121, 

431, 

114, 

97, 

88, 

245, 

255, 


880, 000 
980, 000 
190, 000 
695, 000 
930, 000 
975, 000 
415, 000 
265, 000 
480, 000 
900, 000 
500, 000 
425, 000 


$106, 

416, 
75, 

177, 
37, 
70, 

215, 
41, 
58, 
39, 

169, 
91, 


080, 000 
785, 000 
878, 000 
675, 000 
498, 000 
103, 000 
984, 000 
702, 000 
055,  000 
730, 000 
850, 000 
810,  000 


Total 3,894,635,000 


1,  501, 150, 000 


1  On  a  coupon  issue  of  the  same  length  and  for  the  same  amount  invested,  the  return  on  these  bills  would 
provide  a  yield  of  2.54%.  Interest  rates  on  bills  are  quoted  in  terms  of  bank  discount  with  the  return  re- 
lated to  the  face  amount  of  the  bills  payable  at  maturity  rather  than  the  amount  invested  and  their  length 
in  actual  number  of  days  related  to  a  360-day  year.  In  contrast,  yields  on  certificates,  notes,  and  bonds 
are  computed  in  terms  of  interest  on  the  amount  invested,  and  relate  the  number  of  days  remaining  in 
an  interest  payment  period  to  the  actual  number  of  days  in  the  period,  with  semiannual  compounding 
if  more  than  one  coupon  period  is  involved. 

PRESS  RELEASE  OF  APRIL  6,  1961 

The  Treasury  Department,  by  this  pubHc  notice,  invites  tenders  for 
$2,000,000,000,  or  thereabouts,  of  365-day  Treasury  bills,  for  cash  and  in  ex- 
change for  Treasury  bills  maturing  April  15,  1961,  in  the  amount  of  $2,000,780,000, 
to  be  issued  on  a  discount  basis  under  competitive  and  noncompetitive  bidding 
as  hereinafter  provided.  The  bills  of  this  series  will  be  dated  April  15,  1961,  and 
will  mature  April  15,  1962,  when  the  face  amount  will  be  payable  without  interest. 
They  will  be  issued  in  bearer  form  onlv,  and  in  denominations  of  $1,000,  $5,000, 
$10,000,  $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  o'clock  p.m.,  eastern  standard  time,  Wednesday,  April  12, 
1961.  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  these  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. 

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  responsible  and  recognized 
dealers  in  investment  securities.  Tenders  from  others  nmst  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. 

Immediatley  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  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  $400,000  or  less  without 
stated  price  from  any  one  bidder  will  be  accepted  in  full  at  the  average  price  (in 
three  decimals)  of  accepted  competitive  bids.  Settlement  for  accepted  tenders  in 
accordance  with  the  bids  must  be  made  or  completed  at  the  Federal  Reserve 
Bank  on  April  17,  1961,  in  cash  or  other  immediately  available  funds  or  in  a  like 
face  amount  of  Treasury  bills  maturing  April  15,  1961.  Cash  and  exchange 
tenders  will  receive  equal  treatment.  Cash  adjustments  will  be  made  for  differ- 
ences 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 


EXHIBITS 


265 


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  dis- 
count 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,  Revised,  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  or  branch. 


PRESS  RELEASE  OF  APRIL  13,  1961 

The  Treasury  Department  announced  last  evening  that  the  tenders  for  $2,000,- 
000,000,  or  thereabouts,  of  365-day  Treasury  bills  to  be  dated  April  15,  1961, 
and  to  mature  April  15,  1962,  which  were  offered  on  April  6,  were  opened  at  the 
Federal  Reserve  Banks  on  April  12. 
The  details  of  this  issue  are  as  follows: 

Total  applied  for $4,  116,  451,  000 

Total  accepted  (includes  $178,  894,000  entered  on  a  non- 
competitive basis  and  accepted  in  full  at  the  average 

price  shown  below) 2,000,367,000 

Range  of  accepted  competitive  bids  (excepting  one  tender 
of  $1,500,000): 

High,    equivalent    rate    of    discount    approximately 

2.790%  per  annum 97.  171 

Low,  equivalent  rate  of  discount  approximately  2.844% 

per  annum 97.  117 

Average,  equivalent  rate  of  discount  approximately 

2.827%  per  annum^ 97.  134 

(81  percent  of  the  amount  bid  for  at  the  low  price  was  accepted) 


Federal  Reserve  district 


Total  applied 
for 


Total  accepted 


Boston 

New  York 

Philadelphia.  - 

Cleveland 

Richmond 

Atlanta 

Chicago 

St.  Louis 

Minneapolis- 
Kansas  City... 

Dallas 

San  Francisco. 


$86, 818, 000 

2, 682, 215, 000 

57,  591, 000 

225,551,000 
37, 904, 000 
74,  745, 000 

522, 032, 000 
24, 797, 000 
27,  570, 000 
52,  284, 000 
39, 021, 000 

285,  923, 000 


$31, 818, 000 
,  344, 345, 000 
20, 191, 000 
72,  491, 000 
17,804,000 
35, 495, 000 

230, 793, 000 

13,  247, 000 

7, 370, 000 

27, 169, 000 

22,  921, 000 

176, 723, 000 


Total — - — -      4, 116, 451, 000 


2, 000, 367, 000 


»  On  a  coupon  issue  of  the  same  length  and  for  the  same  amount  invested,  the  return  on  these  bills  would 
provide  a  yield  of  2.93%.  Interest  rates  on  bills  are  quoted  in  terms  of  bank  discount  with  the  return 
related  to  the  face  amount  of  the  bills  payable  at  maturity  rather  than  the  amount  invested  and  their  length 
in  actual  number  of  days  related  to  a  360-day  year.  In  contrast,  yields  on  certificates,  notes,  and  bonds  are 
computed  in  terms  of  interest  on  the  amount  invested,  and  relate  the  number  of  days  remaming  in  an 
interest  payment  period  to  the  actual  number  of  days  in  the  period,  with  semiannual  compounding  if  more 
than  one  coupon  period  is  involved. 


266   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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EXHIBITS 


267 


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EXHIBITS 


269 


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270    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Guaranteed  Obligations  Called 

Exhibit  5. — Calls  for  partial  redemption,  before  maturity,  of  insurance  fund 

debentures 

During  the  fiscal  year  1961,  there  were  fifteen  calls  for  partial  redemption, 
before  maturity,  of  insurance  fund  debentures,  seven  dated  September  23,  1960, 
and  the  others  dated  March  16,  1961.  The  notices  of  call  were  pubhshed  in  the 
Federal  Register  of  September  30,  1960,  and  March  30,  1961.  The  notice  cover- 
ing the  ninth  call  of  the  2>^,  2%,  2%,  2%,  3,  3^,  3%,  3%,  3/2,  S%,  and  4}^  percent 
Series  AA  mutual  mortgage  insurance  fund  debentures  is  shown  in  this  exhibit. 
Since  the  other  notices  of  call  are  similar  to  this  exliibit,  they  have  been  omitted 
but  the  essential  details  are  summarized  in  the  table  following  the  notice  of  call. 

NOTICE  OF  CALL.     FEDERAL  REGISTER  OF  SEPTEMBER  30,   1960 

To  Holders  of  2Yi;  2%;  2%;  2li;  3;  3%;  3^;  3%;  SVf,  3%;  and  4/3  Percent  Mutual 
Mortgage  Insurance  Fund  Debentures,  Scries  A  A: 

NOTICE  OF  CALL  FOR   PARTIAL  REDEMPTION,   BEFORE   MATURITY,   OF  2H;  2^;  2H;  2W,  3; 

z\i;  3M;  ZW,  zw,  3?^;  AND  4'/^  percent  mutual  mortgage  insurance  fund  deben- 
tures, SERIES  AA 

Pursuant  to  the  authority  conferred  by  the  National  Housing  Act  (48  Stat. 
1246;  U.S.C.,  Title  12,  Sec.  1701  et  seq.)  as  amended,  public  notice  is  hereby 
given  that  2^,  2%,  2%,  2%,  3,  2,]i,  'i%,  3%,  3>^,  3%,  and  41/3  percent  mutual  mortgage 
insurance  fund  debentures,  Series  AA,  of  the  denominations  and  serial  numbers 
designated  below,  are  hereby  called  for  redemption,  at  par  and  accrued  interest, 
on  January  1,  1961,  on  which  date  interest  on  such  debentures  shall  cease: 

2y2,  2%,  2%,  2ys,  3,  SYs,  3%,  3ys,  3%,  3%,  and  ^/g  percent  mutual  mortgage  insurance 
fund  debentures,  Series  A  A 

Serial  numbers  (all 
Denomination  numbers  inclusive) 

$50 3,884  to    6,110 

100 11,369  to  18,042 

500 3,034  to    4,341 

1,000 7,845  to  11,989 

5,000 3,063  to    4,114 

10,000 2,274  to    2,856 

The  debentures  first  issued  as  determined  by  the  issue  dates  thereof  were 
selected  for  redemption  by  the  Commissioner,  Federal  Housing  Administration, 
with  the  approval  of  the  Secretary  of  the  Treasury. 

No  transfers  or  denominational  exchanges  in  debentures  covered  by  the  fore- 
going call  will  be  made  on  the  books  maintained  by  the  Treasury  Department  on 
or  after  October  1,  1960.  This  does  not  affect  the  right  of  the  holder  of  a  deben- 
ture to  sell  and  assign  the  debenture  on  or  after  October  1,  1960,  and  provision 
will  be  made  for  the  payment  of  final  interest  due  on  January  1,  1961,  with  the 
principal  thereof  to  the  actual  owner,  as  shown  by  the  assignments  thereon. 

The  Commissioner  of  the  Federal  Housing  Administration  hereby  offers  to 
purchase  any  debentures  included  in  this  call  at  any  time  from  October  1,  1960, 
to  December  31,  1960,  inclusive,  at  par  and  accrued  interest,  to  date  of  purchase. 

Instructions  for  the  presentation  and  surrender  of  debentures  for  redemption 
on  or  after  January  1,  1961,  or  for  purchase  prior  to  that  date  will  be  given  by 
the  Secretary  of  the  Treasury. 

APPROVED:  September  26,  1960 

A.  GiLMORE  Flues,  Julian  H.  Zimmerman, 

Acting  Secretary  of  the  Treasury.  Commissioner. 

Debentures  redeemed  on  or  after  January  1,  1961,  will  have  interest  paid  with 
principal  for  each  $1,000  for  each  percent  as  follows:  $12.50  for  the  2]^%;  $13,125 
for  the  2%%;  $13.75  for  the  2^4%;  $14,375  for  the  2%%;  $15.00  for  the  3%; 
$15,625  for  the  3/8%;  $16.25  for  the  3!-l%;  $16,875  for  the  3^8%;  $17.50  for  the 
3>^%;  $18.75  for  the  3^4%;  and  $20,625  for  the  4/8%. 

Debentures  purchased  between  October  1  and  December  31,  1960,  will  have 
interest  paid  with  principal  from  July  1,  1960,  to  date  of  purchase,  at  the  following 
rates  per  day  for  each  $1,000  for  each  percent:  $0.067935  for  the  2^%;  $0.071332 
for  the  2^8%;  $0.074728  for  the  2^i%]  $0.078125  for  the  2'4%;  $0.081522  for  the 
3%;  $0.084918  for  the  3.'/8%;  $0.088315  for  the  3^4%;  $0.091712  for  the  3%%; 
$0.095109  for  the  3>^%;  $0.101902  for  the  3K%:  and  $0.112092  for  the  4/8%. 


EXHIBITS 


271 


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274   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

U.S.  Savings  Bonds  Regulations 

ExfflBiT  6. — First  amendment,  March  21,  1961,  to  Department  Circular  No.  653, 
Fifth  Revision,  regulations  governing  Series  E  savings  bonds 

Treasury  Department, 
Washington,  March  21,  1961. 

Section  316.13(d)  of  Department  Circular  No.  653,  Fifth  Revision,  dated 
September  23,  1959  (31  CFR,  1960  Supp.,  316),  is  hereby  revised  to  read  as 
follows: 

Sec.  316.13.  Further  investment  yield  {interest)  on  Series  E  bonds  AFTER 
MATURITY — optional  extension  privileges. —  *   *   * 

(d)  Additional  optional  extension  privilege  on  bonds  tvith  issue  dates  of  May  1, 
1941,  through  May  1,  1949. — Owners  of  bonds  with  issue  dates  of  May  1,  1941, 
through  Ma}'  1,  1949  (i.e.,  those  which  reach  the  end  of  their  first  extension 
period  beginning  May  1,  1961,  through  May  1,  1969),  are  hereby  granted  the 
option  of  retaining  their  bonds  for  a  second  10-year  optional  extension  period  at 
the  investment  yield  of  approximately  3.75  percent  per  annum  compounded 
semiannually  for  the  second  extension  period.  The  redemption  value  of  any 
bond  at  the  end  of  the  extended  maturity  period  will  be  the  base  upon  which 
interest  will  accrue  during  the  second  extension  period.  See  tables  I  through 
XVIII  at  the  end  of  this  amendment  for  the  schedules  of  redemption  values  and 
investment  yields  of  the  bonds. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


EXHIBITS 

Table  I.— United  States  Savings  Bonds— Series  E 


275 


TABLE    OF   REDEMPTION   VALUES   AND   INVESTMENT   YIELDS  DURINO    EXTENDED    MATURITY  PERIODS'    FOR 
BONDS   BEARINO  ISSUE   DATE   OF  MAY    1,   1941 

Table  showing:  (/)  How  bonds  of  Series  E  bearing  issue  date  of  May  1,  19J,1,  by  denominations,  increase  in 
redemption  value  daring  successive  half-year  periods  following  date  of  original  mnturity:  (2)  the  approrimnte 
investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year  period;  and  (3)  the 
approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period  (a)  to 
first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent  per 
annum,  compounded  semiannually. 


Oritiiiuil  maturity  value- 
Issue  price — 


Period  after  original  ma- 
turity (be.ffinnins:  10 
years  after  issue  date) 


First  V^year., 
M  to  1  year... 

1  to  1 V^  years. 
1\4  to  2  years. 

2  to  2V$  years- 
2],i  to  3  years- 

3  to  3V^  years. 
3}-^  to  4  years. 

4  to  4}4  years. 
4H  to  5  years- 

5  to  5V^  years. 
5J/2  to  6  years. 

6  to  &l-i  years - 
6}4  to  7  years. 

7  to  lli  years. 
7}4  to  8  years. 

8  to  83^  years. 
814  to  9  years. 


$25.  00 
18.  75 


$50.  00 
37.50 


$100.00 
75.00 


$500.  00 
375.  00 


$1, 000.  00 
750.  00 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


First  extended  maturity  period 


$25.  00 
25.31 
25.62 
25.94 
26.25 
26.56 
26.87 
27.19 
27.50 
27.81 
28.12 
28.44 
28.75 
29.06 
29.37 
30.00 
30.67 
31.33 


$50. 00 
50. 62 
51.25 
51.87 
52.50 
53. 12 
53.75 
54.37 
55.00 
55.  62 
56.25 
56.87 
57.50 
58.12 
58.75 
60.00 
61.33 
62.  67 


$100. 00 
101.25 
102.  50 
103. 75 
105.  00 
106. 25 

107.  50 

108.  75 
110.00 
111.25 
112.  50 
113. 75 
115.00 
116.25 
117.50 
120. 00 
122.  67 
125.33 


$500.00  1 

506 

25 

512 

50 

518 

75 

525.00  1 

531 

25 

537 

,50 

543 

75 

550.  00 

556.  25 

562 

,50 

568. 75 

575.  00 

581 

25 

587 

50 

600. 00 

613.33 

626 

67  1 

$1,000.00 
1,012.50 
1,025.00 
1, 0.37.  50 
1, 0.50.  00 
1, 062.  50 
1,  075.  00 
1, 087.  50 
1, 100. 00 
1,112.50 
1,125.00 
1, 137.  50 
1,150.00 
1, 162.  50 
1,175.00 
1, 200. 00 
1, 226.  67 
1,  253.  33 


Approximate  invest- 
ment yield  2 


(2)  On 
purchase 
price  from 
Issue  date 

to 
bepinning 

of  each 
half-year 

period 


Percent 
2.90 
2.88 
2.86 
2.84 
2.82 
2.81 
2.79 
2.77 
2.75 
2.74 
2.72 
2.71 
2.69 
2.67 
2.66 
2.70 
2.75 
2.79 


(3)  On 
current  re- 
demption 
value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


Percent 
3  2.90 
3  2.92 
3  2.94 
3  2.97 
33.01 
33.05 
33.10 
33. 16 
33.23 
33.32 
33.43 
3  3.56 
33.73 
3  3.96 
3  4.26 
3  4.26 
34.21 
44.77 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  19.59,  revision 


9  to  9J^  years 

9H  to  10  years 

First  extended  maturity 
value    (10   years   from 
originalmaturitydate)'. 

$32. 03 
32.80 

33. 63 

$64. 06 
65.60 

67. 26 

$128. 12 
131.20 

134.  52 

$640. 60 
656. 00 

672  60 

$1,281.20 
1,312.00 

1    MF,  90 

2.84 
2.89 

2.94 

2.94 
2.96 
2.98 
3.00 
3.02 
3.03 
3.05 
3.06 
3.08 
3.09 
3.10 
3.12 
3.13 
3.14 
3.15 
3.16 
3.17 
3.18 
3.19 
3.20 

3.21 

4.93 
5.06 

Period  after  first  extended 
maturity  (betrinning  20 
years  after  issue  date) 

Second  extended  maturity  period 

(b)  to 

second 

extended 

maturity 

First  14  year 

$33.63 
34.26 
34.90 
35.56 
36. 22 
36.90 
37. 60 
38.30 
39.02 
30.75 
40.50 
41.25 
42.03 
42.82 
43.62 
44.44 
45.27 
46.12 
46.98 
47.86 

48.76 

$67.26 
68.52 
69.80 
71.12 
72.44 
73.80 
75.20 
76. 60 
78.04 
79.50 
81.00 
82.50 
84.06 
85.64 
87.24 
88.88 
90.54 
92.24 
93.96 
95.72 

97.52 

$134. 52 
137. 04 
139.60 
142. 24 
144. 88 
147.60 
150. 40 
153. 20 
156.  08 
159.00 
162. 00 
165. 00 
108. 12 
171.28 
174.48 
177.  76 
181.08 
184.48 
187.92 
191.44 

195. 04 

$672. 60 
685. 20 
698. 00 
711.20 
724. 40 
738. 00 
752. 00 
706. 00 
780. 40 
795. 00 
810. 00 
825. 00 
840. 60 
856. 40 
872. 40 
888. 80 
905. 40 
922. 40 
939. 60 
957. 20 

975.  20 

$1,  345. 20 
1,  370. 40 
1,  396. 00 
1, 422. 40 
1,448.80 
1,476.00 
1,504.00 
1,  532. 00 
1,  560. 80 
1,  590. 00 
1,620.00 
1, 650.  00 
1,681.20 
1,712.80 
1,744.80 
1,  777.  00 
1,810.80 
1, 844. 80 
1,879.20 
1,914.40 

1,950.40 

3.75 

3.75 

1  to  IVi^  years 

3.75 

li'^to2  years     . 

3.75 

2  to  2'/^  years 

3.75 

2'^  to  3  years         .  . 

3.75 

3.75 

3.75 

3.75 

3.75 

3.75 

SJ^tofl  years     

3.75 

3.75 

6J4  to  7  years     

3.75 

3.75 

3.75 

8  to  8J^  years     ... 

3.75 

3.75 

9to9Viyears     .  

3.75 

9'-^  to  10  years  

3.76 

Second  extended    matu- 
rity value  (20  years  from 
original  maturity  date)  8. 

1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.  2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Appro.ximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

« 20  years  from  issue  date.  »  30  years  from  issue  date. 


k 


276 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  II.— United  States  Savings  Bonds— Series  E 

TABLE  OF  redemption  VALUES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIODS  '  FOR  BONDS 
BEARING  ISSUE  DATES  FROM  JUNE    1   THROUGH  NOVEMBER   1,    1941 

Table  showing:  (?)  Hoiv  bonds  of  Series  E  bearing  issue  dates  from  June  1  through  November  1, 1941,  by  denomina- 
tions, increase  in  redemption  value  during  successire  half-year  periods  following  date  of  original  maturity;  (2)  the 
approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
(a)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannually. 


Original  maturity  value. 
Issuf  nrice -. 


Period  after  original  ma- 
turity (beginning  10 
years  after  issue  date) 


First  J.iyear_. 
J4  to  1  year... 
ItoVA  years. 
VAto2  years. 

2  to  2^/^  years. 
2}4  to  3  years. 

3  to  33^  years. 
3H  to  4  years. 

4  to  4}^  years. 
4}4to  5  years- 

5  to  514  years. 
S}'^  to  6  years. 

6  to  &\-i  years. 
&14  to  7  years. 

7  to  7  A  years. 
7J^  to  8  years- 

8  to  8J^  years. 


$25.  00 
18.  75 


$50.  00 
37.50 


$100.  no 

75.00 


$500.  on 

375.  00 


$1,000.00 
750.  00 


(1)  Redemption  values  during  each  half-year  period 
(.Values  Increase  on  first  day  of  period  shown) 


First  extended  maturity  period 


$25. 00 

.$50.  00 

25.31 

50.  62 

25.62 

51.25 

25.94 

51.87 

26.  25 

52.  50 

26.  56 

,53.  12 

26.87 

53.  75 

27.19 

54.  37 

27.50 

55.00 

27.81 

55.62 

28.12 

56.25 

28.44 

56. 87 

28.75 

57.  50 

29.  C6 

.58. 12 

29.37 

58.  75 

30.00 

60.00 

30.67 

61.33 

$100. 00 

101.25 

102.  50 

103.  75 

105. 00 

106.  25 

107. 50 

K.8.75 

110.00 

111.25 

112.50 

113.75 

115.00 

116.25 

11 7.  ,50 

120.00 

122.67 

$500.  00 

506.  25 

512.50 

518.  75 

525.  00 

531.25 

537.  50 

543.  75 

550.  00 

556.  25 

562.  50 

568.  75 

575.  00 

581.25 

587.  50 

6C0. 00 

613. 33 

$1,000.00 
1,012.50 
1,  025. 00 
1,037.  ,50 
1, 050. 00 
1, 062.  50 
1, 075. 00 
1,087.50 
1,100.00 
1,112  50 
1, 125. 00 
1, 137.  50 
1, 150. 00 
1,162.  .50 
1,17.5.00 
1,200.00 
1,226.67 


Appro.ximate  invest- 
ment yield  2 


(2)  On 
purchase 
price  from 
issue  date 

to 
beginning 

of  each 
half-year 

period 


Percent 
2.90 
2.88 
2.86 
2.84 
2.82 
2.81 
2.79 
2.77 
2.75 
2.74 
2.72 
2.71 
2.69 
2.67 
2.66 
2.70 
2.75 


(3)  On 
current  re- 
demption 
value  from 
beginning 
of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


Percent 
3  2.90 
3  2.  92 
3  2.94 
3  2.97 
3  3. 01 
33.05 
3  3. 10 
3 .3. 16 
3  3.  23 
3  3. 32 
3  3.  43 
3  3. 56 
3  3.  73 
3  3. 96 
3  4. 26 
3  4.26 
M.82 


Redemption  values  and  investment  yields  to  first  extended  mat'irity  on  basis  of  .Tune  1,  1959,  revision 


8K  to  9  years 

9  to  9}^  years         . 

$31.36 
32.10 

$62.  72 
64.20 
65.  78 

67.46 

$125.  44 
128.40 
131., 56 

134.92 

$627.  20 
642.  00 
657.  80 

674.  60 

$1,254.40 
1,284.00 
1,31.5.60 

1,349.20 

2.80 
2.85 

4.92 
5.02 

93/2  to  10  years 

First  extended  maturity 
value    (10   years   from 
original  maturity  date)'. 

32.89 
33.73 

2.90 
2.96 

2.96 
2.98 
3.00 
3.01 
3.03 
3.05 
3.06 
3.07 
.3.09 
3.10 
3.12 
3.13 
3.14 
3.15 
3.16 
3.17 
3.18 
3.19 
3.20 
3.21 

3.22 

5.11 

Period  after  first  extended 
maturity  (beginning  20 
years  after  issue  date) 

Second  extended  maturicy  perioil 

(b)  to 

second 

extended 

maturity 

First  }^  year 

$33.  73 
34.36 
35. 01 
35.66 
36.33 
37.01 
37.71 
38.41 
39.13 
39.87 
40.62 
41.38 
42.15 
42.94 
43.75 
44.57 
45.40 
46.26 
47.12 
48.01 

48.91 

$67. 46 
68.72 
70.02 
71.32 
72.66 
74.02 
75.42 
76.82 
78.26 
79.74 
81.24 
82.76 
84.30 
85.88 
87.  50 
89.14 
90.80 
92.52 
94.24 
96.02 

97.82 

$134.92 
137.  44 
140.04 
142.  64 
145.  32 
148.04 
150. 84 
153. 64 
156.  ,52 
15'J.  48 
162.48 
16.5.  .52 
168.60 
171.76 
175.00 
178.28 
181.60 
185.04 
188.  48 
192.04 

195.64 

$674. 60 
687.  20 
700.  20 
713.  20 
726. 60 
740.  20 
754.  20 
768.  20 
782. 60 
797.  40 
812.40 
827.  60 
843.  00 
858. 80 
875. 00 
891.40 
908.  00 
925.  20 
942.40 
960.20 

978.  20 

$1,  349. 20 
1.374.40 
1,400.40 
1.  426.  40 
1.453.20 
1,  481).  40 
1,  508.  40 
1,536.40 
1,565.20 
1,594.80 
1,  624.  80 
1,655.20 
1,  686.  00 
1,717.60 
1,750.00 
1,782.80 
1,816.00 
1,8.50.40 
1,884.80 
1,  920.  40 

1,956.40 

3.75 

3^  to  1  year...    .  

3.75 

1  to  13^  years.-  ...... 

3.75 

1}/$  to  2  years..  ..  ...  .  . 

3.  75 

2  to  2J^  years 

23^  to  3  years..  

3.75 
3.75 

3  to  33^  years . 

3.75 

3J^  to  4  years         .  .  .  .. 

3.75 

3.  75 

4J^  to  5  years             -  - 

3.75 

5  to  5}/^  years.-  

3.  75 

3.  75 

6  to  6}4  years      -      ... 

3.  75 

6j^to  7  years. 

3.75 
3.75 

7J-$  to8  years 

8  to  8J^  years 

8  V^  to  9  years         . 

3.75 
3.76 
3.75 

9  to  9H  years 

3.76 

9]/i  to  10  years              .  . 

3.75 

Second  extended  matu- 
rity   value    (20    years 
from  original  maturity 
date)  8 

'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  SeptemlxT  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  lialf-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  .Tune  1,  1959,  revision. 

*  Appro.\imate  investment  yield  from  effective  date  of  .Tune  1,  1959,  revision  to  first  extended  maturity. 

'  20  years  from  issue  date.       « 30  years  from  issue  date. 


EXHIBITS 


277 


Tatile  III.— IJvited  States  SAViNr;s  Bonds— Series  E 

TAFLE    OF   REDEMPTION    VALUES   AND    INVESTMENT    YIELDS   DTTRINn    EXTENDED    MATrRITY    PERIODS  '    FOR 
BONDS   PEARINC   ISSCE  DATES  FROM   DECEMBER   1,    1941,   THROIJCH  APRIL  1,    1942 

Table  showing:  (1)  How  bonds  of  Series  E  bearingissue  dates  from  December  1, 1941, through  April  1, 1942,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity: 
{2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  valve  from  the  beginning  of  each 
half-year  period  (a")  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannm-lly . 


Original  maturity  value.. 

$25.  00 
18.75 

$50. 00 
37.50 

$100. 00 
75.00 

$500.  00 
375.  00 

$1,000.00 
750.  00 

Approximate  invest- 
ment yield  2 

Period  after  orieinal  ma- 

n) Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 

(2^  On 
purchase 
price  from 
issue  date 

to 
beginning 

of  each 
half-year 

period 

(3)  On 
current  re- 
demption 
value  from 
bengining 

turity   (beginning  10 
years  after  issue  date) 

First  extended  maturity  period 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 

First  yi  year  .             

$25. 00 
25.  31 
25.62 
25.94 
26.25 
26.56 
26.87 
27.19 
27.50 
27.8' 
28.12 
28.44 
28.75 
29.06 
29.37 
30.00 

$50. 00 
50.62 
51.25 
51.87 
52.50 
53.12 
53.75 
54.37 
55.00 
55.62 
56.25 
56.87 
57.50 
58.12 
58.75 
60.00 

$100. 00 
101.25 

102.  50 

103.  75 
105. 00 
106. 25 

107.  50 

108.  75 
110.  00 
111.25 
112.  50 
113.75 
115.00 
116  25 
117.  50 
120. 00 

$500. 00 
506. 25 
512.  50 
518. 75 
525. 00 
531.25 
537.  50 
543. 75 
550.00 
556. 25 
562.  50 
568.  75 
575. 00 
581. 25 
587.  50 
600. 00 

$1, 000. 00 
1,012.50 
1, 025. 00 
1,037.50 
1, 050. 00 
1,062.50 
1, 075. 00 
1, 087. 50 
1,100.00 
1, 112. 50 
1,125.00 
1, 137.  50 
1,150.00 
1, 162.  50 
1, 175. 00 
1. 200. 00 

Percent 
2.90 
2.88 
2.86 
2.84 
2.82 
2.81 
2.79 
2.77 
2.75 
2.74 
2.72 
2.71 
2.69 
2.67 
2.66 
2.70 

Fercent 
3  2.90 

3  2.92 

1  to  1}-^  years             - 

3  2.94 

13^  to  2  years.-  .- 

3  2.97 

2  to  2H  years 

33.01 

23^  to  3  years .  -  - 

33.05 

3  to  5}/2  years 

33.10 

33'2  to  4  years       .  -      -  - 

33. 16 

4  to  4}^  years --  -- 

33.23 

4}^  to  5  vears---  

3  3. 32 

5  to  55-^  years.-  ._ 

33.43 

5^  to  6  years 

«3.56 

6  to  aVi  years     

»3.73 

3  3.96 

7  to  73-^  years 

3  4.26 

73'2  to  8  years 

M.86 

Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1, 1959,  revision 


8  to  832  years 

834  to  9  years-           -    -- 

$  30. 69 
31.41 
32.17 
32.98 

33.83 

$61. 38 
62.82 
64.34 
65.96 

67.66 

$122.  76 
125.  64 
128. 68 
131.92 

135. 32 

$613. 80 
628.  20 
643.  40 
659. 60 

676.  60 

!)il,227.60 
1, 2,56. 40 
1, 286. 80 
1, 319. 20 

1,  353.  20 

2.76 
2.81 
2.86 
2.92 

2.97 

2.97 
2.99 
3.01 
3.03 
3.04 
3.06 
3.07 
3.09 
3.10 
3.12 
3.13 
3.14 
3.15 
3.16 
3.17 
3.18 
3.19 
3.20 
3.21 
3.22 

3.23 

4.93 
5.01 

5.10 

93^2  to  10  years 

5.15 

First  extended  maturity 
value    (10   years   from 
original  maturity  date)'- 

Period  after  first  extended 
maturity  (beginning  20 
years  after  issue  date) 

Second  extended  maturity  period 

(b)  to 

second 

extended 

maturity 

First  ^2  year 

$33. 83 
34.46 
35.11 
35.77 
36.44 
37.12 
37.82 
38.53 
39.25 
39.99 
40.74 
41.50 
42.28 
43.07 
43.88 
44.70 
45.54 
46.39 
47.26 
48.15 

49.  05 

$67. 66 
68.92 
70.22 
71.54 
72.88 
74.24 
75.64 
77.06 
78.50 
79.98 
81.48 
83.00 
84.56 
86.14 
87.76 
89.40 
91.08 
92.78 
94.52 
96.30 

98.10 

$135.  32 
137. 84 
140. 44 
143. 08 
145.  76 
148. 48 
151. 28 
154. 12 
157. 00 
159. 96 
162. 96 
166. 00 
169. 12 
172.  28 
175.  52 
178.80 
182. 16 
185.  56 
189. 04 
192. 60 

196.  20 

$676. 60 
689. 20 
702. 20 
715.40 
728. 80 
742.40 
756. 40 
770. 60 
785. 00 
799. 80 
814. 80 
830.  00 
845.  60 
861.40 
877.  60 
894. 00 
910. 80 
927. 80 
945. 20 
963. 00 

981. 00 

$1,353.20 
1,378.40 
1,404.40 
1, 430. 80 
1, 4.57. 60 
1,  484.  80 
1,  512. 80 
1,  541.  20 
1,  570.  00 
1,  599.  60 
1.  629. 60 
1, 6fi0. 00 
1,691.20 
1,  722.  80 
1,  755. 20 
1, 788. 00 
1,821.60 
1, 855. 60 
1, 890. 40 
1, 926. 00 

1,  962. 00 

3.75 

}/2  to  1  year 

3.75 

1  to  132  years 

3.75 

1}-^  to  2  years  . 

3.75 

2  to  2^4  years 

3.75 

2}A  to  3  years 

3.75 

3  to  33^  years  .    

3.75 

33^  to  4  years... ... 

3.75 

4  to  4^4  years       .      

3.75 

3.75 

5  to  53^  years                 .  . 

3.75 

514  to  6  years 

6  to  6H  years 

3.75 
3.75 

3.75 

7  to  73'2  years.  .     

3.75 

7'/^  to  8  years.           ..  . 

3.75 

8  to  83^^  years 

3.75 

8 '-4  to  9  years 

3.75 

9  to  9^-2  years 

3.75 

9^  to  10  years 

3.74 

Second  extended   matu- 
rity   value    (20    years 
from  original  maturity 
date)" 

>  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959. 

2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Appro.ximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  .June  1,  1959,  revision. 

*  Approximate  investment  yield  from  efi'ective  date  of  Jmie  1, 1959,  revision  to  first  extended  maturity. 
« 20  years  from  issue  date.       6  30  years  from  issue  date. 


278   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  IV.— United  States  Savings  Bonds— Series  E 

TABLE   OF   REDEMPTION  VALUES   AND  INVESTMENT  YIELDS   DURING   EXTENDED   MATURITY   PERIODS  >    FOR 
BONDS  BEARING  ISSUE  DATE  OF  MAY  1,  1942 

Table  sho'i'inrj:  (/)  Hot  bonds  of  Series  E  bearing  issue  date  of  May  /,  19i2.  by  denorninations,  increase  in 
redemptioT)  value  during  successive  half-year  periods  follotring  date  of  original  maturity:  (2)  the  approximate 
investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year  period:  and  (3)  the 
approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period  (a)  to 
first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent  per 
annum,  compounded  semiannually. 


Oricinal  maturity  value.. 
Issue  price 


$25.  00 
18.75 


$50.  00 
37.50 


$100.  00 
75.00 


$500.  00 
375.  00 


$1. 000.  00 
750.  00 


Approximate  invest- 
ment yield  2 


(1)  Redemption  values  during-  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


Period  after  orieinal  ma- 
turity (beeinning  10 
years  after  issue  date) 


First  e.xtended  maturity  period 


(2)  On 
purchase 
price  from 
issue  date 

to 
bennnins; 

of  each 
half-year 

period 


First  Hyear.. 
M  to  1  year.— 

1  to  IM  years.. 
IK  to  2  years.. 

2  to  2}4  years.. 
2}^  to  3  years.. 

3  to  33^  years. 
SJi  to  4  years., 

4  to  4H  years. 
4H  to  5  years. 

5  to  514  years. 
5J/2  to  6  years. 

6  to  6\i  years. 
6H  to  7  years. 

7  to  714  years. 
7}4  to  8  years. 


$25.  00 
25.  37 
25.75 
26.12 
26.50 
26.90 
27.30 
27.70 
28.10 
28.50 
28.95 
29.40 
29.85 
30.30 
30.75 
31.20 


$50.  00 

50.  75 

51.50 

52.  25 

53.00 

53.80 

54.  60 

55.40 

56.20 

57.00 

57.  90 

58.80 

59.70 

60.60 

61.50 

62.40 

$100.  00 
101.  50 

103.  00 

104.  50 

106.  00 

107.  60 

109.  20 

110.  80 
112.  40 
114.00 
115.  80 
117.  60 
119.  40 
121.  20 

123.  00 

124.  80 


$500.  00 
507.  50 
515.00 
522.  50 
530.  00 
538.  00 
546.  00 
554.  00 
562.  00 
570.  00 
579.  00 
588.  00 
597.  00 
606.  00 
615.  00 
624.  no 


$1, 000.  00 
1,015.00 
1,030.00 
1, 045.  00 
1, 060.  00 
1, 076.  00 
1, 092.  00 
1, 108.  00 
1. 124.  00 
1, 140.  00 
1,158.00 
1. 176.  00 
1, 194.  00 
1,212.00 
1, 230.  00 
1.248.00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 
2.92 
2.92 
2.93 
2.93 
2.93 
2.93 


(3)  On 
current  re- 
demption 
vahie  from 
be.?inninG: 

of  each 
half-year 
period  (a) 

to  first 
extencied 
maturity 


Percnt 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
33. 
*3. 


Redemption  values  and  investment  yields  to  fir.st  extended  maturity  on  basis  of  June  1,  1959,  revision 


8  to  814  years     

$31.  67 
32.21 
32.80 
33.42 

34.09 

$63.  34 
64.  42 
65.60 
66.84 

68.18 

$126.  68 
128.  84 
131. 20 
133. 68 

136.  36 

$633.  40 
644.  20 
656.  00 
668. 40 

681.  80 

$1,  266. 80 
1,  288.  40 
1,312.00 
1,336.80 

1, 363.  60 

2.93 
2.95 
2.97 
2.99 

3.01 

3.01 
3.03 
3.05 
3.06 
3.08 
3.09 
3.11 
3.12 
3.13 
3.15 
3.16 
3.17 
3.18 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 

3.26 

3.72 

S}4  to  9  years 

3.82 

9  to  O^ia  years .. 

3.89 

9H  to  10  years. 

4.01 

First  extended  maturity 
value   (10  years  from 
orif  inal  maturity  datel'. 

Period  after  first  extended 
maturity  (be?:innine  20 
years  after  issue  date) 

Second  extended  maturity  period 

(b)  to 

second 

extended 

maturity 

First  M  year .. 

$34.09 
34.73 
35.38 
36.04 
36.72 
37.41 
38.11 
38.82 
39.55 
40.29 
41.05 
41.  82 
42.60 
43.40 
44.22 
45.04 
45.89 
46.75 
47.63 
48.52 

49.43 

$68.  18 
69.46 
70.76 
72.  08 
73.44 
74.82 
76.22 
77.64 
79.10 
80.58 
82.10 
83.64 
85.20 
86.80 
88.44 
90.08 
91.78 
93.50 
95.26 
97.04 

98.86 

$136.  36 
138.  92 
141.  52 
144. 16 
146. 88 
149.  64 
152.  44 
155.  28 
158.  20 
161. 16 
164. 20 
167. 28 
170. 40 
173.  60 
176.  88 
180. 16 
183.  56 
187. 00 
190.  52 
194  08 

197.  72 

$681.80 
694.  60 
707.  60 
720.  80 
734.  40 
748.  20 
762.  20 
776.  40 
791.  00 
805.  80 
821.  00 
836.  40 
852. 00 
868.  00 
884.40 
900.  80 
917.80 
935.  00 
952.  60 
970. 40 

988.  60 

$1, 363.  60 
1, 389.  20 
1,415.20 
1,441.60 
1,  468.  80 
1. 496.  40 
1, 524.  40 
1,  552.  80 
1,  582.  00 
1,611.60 
1, 642.  00 
1, 672.  80 
1, 704.  00 
1,  736.  00 
1, 768.  80 
1, 801.  60 
1,  835.  60 
1, 870  00 
1, 905.  20 
1, 940.  80 

1.977.20 

3.75 

J^  to  1  year 

3.75 

1  to  lyi  years 

3.75 

IJ^  to  2  years 

3.75 

2  to  2 J'^  years     

3.75 

2}4  to  3  years 

3.75 

3  to  syi  years 

3.75 

33^  to  4  years     

3.75 

4  to  4J^  years 

3.75 

4H  to  5  years     

3.75 

5  to  5}4  years 

3.75 

5H  to  6  years 

3.75 

6to6H  years 

3.75 

6K  to  7  years 

3.75 

7  iol}/2  years     

3.75 

7H  to  8  years.. 

3.76 

8  to  8^  years       

3.75 

8H  to  9  years 

3.75 

9  to  9H  years 

3.74 

9M  to  10  years 

3.75 

Second  extended  matu- 
rity   value    (20    years 
from  oriyinal  maturity 
date)' 

'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,0C0  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  .lune  1,  1959,  revision. 

<  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

» 20  years  from  issue  date.       «  30  years  from  issue  date. 


EXHIBITS 


279 


Table  v.— United  States  Savings  Bonds— Series  E 

TABLE  OF  redemption  VALUES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIODS  '  FOR  BONDS 
bearing   ISSUE  DATES  FROM   JUNE   1   THROUf)H   NOVEMBER   1,    1942 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dates  from  June  1  through  November  1,194$,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  folloming  date  of  original  maturity; 
(5)  the  approximate  investmeni  yield  on  the  purchase  price  from  isstie  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half- 
year  period  (a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of 
rate  percent  per  annum,  compounded  semiannually. 


Orisinal  maturity  value- 
Issue  price 


Period  after  oriirina)  ma- 
turity (becinning  10 
years  after  issue  date) 


$25.  00 
18.75 


$50.  00 
37.50 


$100.  00 
75.  00 


$500.  00 
375.  00 


$1, 000. 00 
750.  00 


(1)  Redemption  values  durins;  each  half-year  period 
(Values  iacrease  on  first  day  of  period  shown) 


First  extended  maturity  period 


Approximate  invest- 
ment yipld  2 


(2)  On 
purchase 
price  from 
issue  date 

to 
beginning 

of  each 
half-year 

period 


(3)  On 
current  re- 
demption 
value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


First  14  year. 
M  to  1  year.. 

1  to  114  years 
IM  to  2  years. 

2  to  214  years. 
2i4  to  3  years. 

3  to  3H  years 
3}4  to  4  years. 

4  to  414  years. 
4H  to  5  years. 

5  to  514  years 
514  to  6  years 

6  to  6H  years 
614  to  7  years 

7  to  7}4  years 


$25.  00 
25.37 
25.75 
26.12 
26.50 
26.90 
27.30 
27.70 
28.10 
28.50 
28.95 
29.40 
29.85 
30.30 
30.75 


$50. 00 
50.75 
51.60 
52.25 
53.  00 
53.80 
54.60 
55.40 
56.20 
57.00 
57.90 
58.80 
59.70 
60.60 
61.50 


$100. 00 

101.  50 

103. 00 

104.  50 

106.  00 

107.  60 

109.  20 

110.80 

112.40 

114.00 

115.80 

117.  60 

119.40 

121.  20 

123.00 

$500. 00 
507.  50 
515.00 
522.  50 
530. 00 
538. 00 
546.  00 
554. 00 
562.  00 
570.  00 
579. 00 
588.  00 
597. 00 
606.  00 
615. 00 


$1,  000. 00 
1,  015.  00 
1,  030.  00 
1, 045. 00 
1,  060.  00 
1,076.00 
1, 092. 00 
1, 108. 00 
1, 124. 00 
1, 140.  00 
1, 158.  00 
1, 176.  00 
1, 194. 00 
1,212.00 
1,  230.  00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 
2.92 
2.92 
2.93 
2.93 
2.93 


Percent 
3  3.00 
33.00 
33.00 
33.01 
33.02 
33.02 
33.02 
33.03 
33.04 
33.05 
33.04 
33.04 
33.03 
33.04 
<3.  55 


Re<]emption  values  and  investment  yields  to  first  e.xtended  maturity  on  basis  of  June  1,  1959,  revision 


7M  to  8  years 

8  to  S}4  years 

8H  to  9  years 

9  to  91/2  years 

9J^  to  10  years 

First  extended  maturity 

value    (10   years   from 
original  maturity  date)'. 


Period  after  first  extended 
maturity  (heiinning  20 
years  after  issue  date) 


First  14  year 

14  to  1  year 

1  to  VA  years 

V'f  to  2  years 

2  to  2]4  years 

2H  to  3  years 

3  to  SH  years 

3]4  to  4  years 

4  to  iA  years 

414  to  5  years 

5  to  5H  years 

5'/^  to  6  years 

6to6H 

6!.-^  to  7  years 

7  to  m  years 

7H  to  8  years 

8  to  8M  years 

814  to  9  years 

9  to  9H  years 

914  to  10  years 

Second  extended  ma- 
turity value  (20  years 
from  original  maturity 
date)  9 


$31.  21 
31.70 
32.27 
32.87 
33.50 


34.17 


$62.  42 
63.40 
64.54 
65.74 
67.00 

68.34 

$124.84 
126.  80 
129. 08 
131.48 
134. 00 


$624.  20 
634.  00 
645.  40 
657.  40 
670. 00 


136.  68         683.  40 


$1,  248.  40 
1,  268.  00 
1,  290. 80 
1,314.80 
1,  340. 00 


Second  extended  maturity  period 


$34. 17 
34.81 
35.46 
36.13 
36.81 
37.50 
38.20 
38.92 
39.64 
40.39 
41.15 
41.92 
42.70 
43.50 
44.32 
45.15 
46.00 
46.86 
47.74 
48.63 


49.54 


$68.  34 
69.62 
70.92 
72.26 
73.62 
75.00 
76.40 
77.84 
79.28 
80.78 
82.30 
83.84 
85.  40 
87.00 
88.64 
90.30 
92.00 
93.72 
95.48 
97.26 


99.  OS 


$136.  68 
139.  24 
141.84 
144.  52 
147.  24 
150.  00 
152.  80 
155.  68 
158.  56 
161.  56 
164.  60 
167.  68 
170.  80 
174. 00 
177.  28 
180.  00 
184.  00 
187.  44 
190.  96 
194.  52 


198. 16 


$683.  40 
696.  20 
709.  20 
722.  60 
736.  20 
750. 00 
764. 00 
778.  40 
792.  80 
807.  80 
823.  00 
838.  40 
854.  00 
870. 00 
886.  40 
903.  00 
920. 00 
937.  20 
954. 80 
972. 60 


990.  SO 


$1,  366.  80 
1,  392.  40 
1,  418.  40 
1,  445.  20 
1, 472.  40 
1,  500.  00 
1,  528. 00 
1,  556.  80 
1,  585.  60 
1,615.60 
1, 646. 00 
1,  676.  80 
1,  708. 00 
1,740.00 
1,  772.  80 
1, 806. 00 
1,  840. 00 
1,  874.  40 
1, 909.  60 
1, 945.  20 


1,981.60 


2.93 
2.94 
2.96 
2.98 
3.00 


3.02 


3.02 
3.04 
3.06 
3.07 
3.09 
3.10 
3.12 
3.13 
3.14 
3.16 
3.17 
3.18 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 


3.26 


3.66 
3.79 
3.85 
3.92 
4.00 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.74 
3.74 
3.74 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959. 

2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 
« 20  years  from  issue  date.    « 30  years  from  issue  date. 


280 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  VI.— United  States  Savings  Bonds— Series  E 

TABLE  OF  REDEMPTION  VALUES  AND   INVESTMENT    YIELDS    DURING    EXTENDED    MATURITY    PERIODS  >  FOR 
BONDS  BEARING  ISSUE   DATES  FROM   DECEMBER   1,    1942,   THROUGH  MAY   1,   1943 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dales  from  December  1,  19^2,  Ihrough  ?t[ay  1,  t9J,S,  by  de- 
nominations, increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  ma- 
twity;  (2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each 
half-year  period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  begin- 
ning of  each  half-year  period(a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  ex- 
pressed in  terms  of  rate  percent  per  annum,  compounded  semiannually. 


Orifrinal  maturity  value.. 
Issue  price 


Period  after  original  ma- 
turity (beginning  10 
years  after  issue  date) 


$25.  00 
18.75 


$50.  00 
37.50 


$100.00 
75.00 


$500  0(1 
375.  00 


$1, 000.  00 
750. 00 


(1)  Redemption  values  during  each  half-year  period 
(Value?  increase  on  first  day  of  reriod  shown) 


First  extended  maturity  period 


Approximate  invest- 
ment yield ' 


(2)  On 
purchase 
price  from 
issue  date 

to 
beginning 

of  each 
half-year 

period 


(3)  On 
current  re- 
demption 
value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturitv 


First  }4  year. . 
H  to  1  year... 

1  to  1}4  years. 
114  to  2  years. 

2  to  2^  years. 
2}4  to  3  years. 

3  to  3H  years. 
3}4  to  4  years. 

4  to  4H  years. 
4H  to  5  years. 

5  to  5H  years. 
5}-^  to  6  years- 

6  to  6H  years. 
614  to  7  years. 


$25.  00 
25.37 
25.75 
26.  12 
26.50 
26.90 
27.30 
27.70 
28.10 
28.50 
28.95 
29.40 
29.85 
30.30 


$50.  00 
.50.  75 
51.50 
52. 25 
53.00 
53.80 
54.  60 
55.40 
56.20 
57.00 
57.90 
58.80 
59.70 
60.60 


$100.  00 
101.  50 

103.  00 

104.  50 
106.  00 
107.60 
109.20 
110. 80 
112.40 
114.00 
115. 80 
117.60 
119.  40 
121. 20 


>500.  00 

507.  50 

515.  00 

522.  50 

530. 00 

538.  00 

546.  00 

554.  00 

562.  00 

570.  00 

579. 00 

588.00 

597.  00 

606.  00 

000.  00 
015.00 
030.  00 
045.  00 
060.  00 
076.  00 
092.  00 
108. 00 
124.  00 
140.  00 
158. 00 
176.  00 
194. 00 
212.  00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.  91 
2.91 
2.91 
2.91 
2.91 
2.92 
2.  92 
2.93 
2.93 


Perce  17  f 
3  3. 00 
3  3.  00 
3  3.00 
3  3. 01 
3  3.02 
3  3. 02 
33.02 
3  3.03 
33.04 
3  3. 06 
33.04 
33.04 
33.03 
<3.54 


Redemption  values  and  investment  yields  to  fir.st  extended  maturity  on  bisis  of  June  1,  1959,  revision 


7  to  7H  years 

73-i  to  8  years 

8  to  8H  years 

8J^  to  9  years 

9  to  9H  years 

9}4  to  10  years 

First  extended  maturity 

value    (10   years   from 
original  maturity  date)'. 


Period  after  first  extended 
maturity  (bej;inninc  20 
years  after  issue  date) 


First  14  year 

J^  to  1  year 

1  to  l},i  years... 

lyito  2  years 

2  to  2H  years 

2H  to  3  years 

3  to  33^  years 

3H  to  4  years 

4  to  4H  years 

i}4  to  5  years 

5  to  5}4  years... 

5H  to  6  years 

6  to  &14  years 

6J^  to  7  years 

7  to  7K  years 

yyi  to  8  years 

8  to  83^2  years. 

8H  to  9  years 

9  to  9J^  years 

9}4  to  10  years 

Second  extended  maturi- 
ty value  (20  years 
from  original  maturity 
date)« 


$30.76 
31.24 
31.75 
32.  33 
32.94 
33.58 


34.26 


$61.  52 
62.48 
63.50 
64.66 
65.88 
67.16 


68.52 


$123.  04 
124.  96 
127.  00 
129.  32 
131.  76 
134.  32 


137. 04 


$615. 20 
624. 80 
635.  00 
646.  60 
658.  80 
671.  60 


685. 20 


$1, 230.  40 
1,  249.  60 
1, 270.  00 
1, 293.  20 
1,317.60 
1, 343.  20 


1.370.40 


Second  extended  maturity  period 


$34.26 
34.90 
35.  56 
36.22 
36.90 
37.59 
38.30 
39.02 
39.  75 
40.49 
41.25 
42.03 
42.  82 
43.62 
44.44 
45. 27 
46.12 
46.98 
47.86 
48.76 


49.68 


$68.  52 
69.80 
71.12 
72.44 
73.80 
75.18 
76.60 
78.04 
79.50 
80.98 
82.50 
84.06 
85.64 
87.24 
88.88 
90.54 
92.24 
93.96 
95.  72 
97.52 


99.36 


$137.04 
139.  60 
142.  24 
144.88 
147.  60 
150.  36 
153.  20 
156.  08 
159.  00 
161.  96 
165.  00 
168.12 
171.  28 
174.  48 
177.  76 
181.  08 
184. 48 
187.  92 
191.  44 
195. 04 


198.  72 


$685.  20 
698.  00 
711.20 
724.  40 
738. 00 
751.  80 
766.  00 
780.  40 
795.  00 
809.  80 
825. 00 
840.60 
856.  40 
872.  40 
888.  80 
905.  40 
922.  40 
939.60 
957.  20 
975.  20 


993.  60 


$1,370.40 
1. 396.  00 
1, 422.  40 
1, 448. 80 
1, 476.  00 
1, 503.  60 
1, 532.  00 
1, 560. 80 
1,590.00 
1,  619.  60 
1, 650.  00 
1,  681.  20 
1, 712.  80 
1, 744.  80 
1,777.60 
1, 810. 80 
1, 844. 80 
1, 879. 20 
1.914.40 
1,  950.  40 


1, 987.  20 


2.93 
2.94 
2.95 
2.97 
2.99 
3.01 


3.04 


3.04 
3.  05 
3.07 
3.09 
3.10 
3.12 
3.13 
3.14 
3.16 
3.17 
3.18 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3. 25 
3.26 
3.27 


3.27 


3.62 
3.73 
3.84 
3.90 
3.97 
4.05 


(b)  to 

seconil 

extended 

maturity 


3.75 
3.  75 
3.75 
3.  75 
3.75 
3.75 
3.  75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.  75 
3.  75 
3.75 
3.  75 
3.  75 
3.76 
3.77 
3.77 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1,  1959,  revision  to  first  extended  maturity. 

« 20  years  from  issue  date.       « 30  years  from  issue  date. 


EXHIBITS 


281 


Table  VII.— United  States  Savincs  Bonds— Series  E 

TAPLE  OF  REDEMPTION  VALUES  AND  INVESTMENT  YIELDS  DURINC  EXTENDED  MATURITY  PERIODS  ■  FOR  BONDS 
BEARINr;  ISSUE  DATES  FROM  JUNE  1  THROUnH  NOVEMPER  1,  1943 

Table  shoiving:  (/)  How  bonds  of  Series  E  bearing  issue  dates  from  June  1  through,  November  1, 194S,  by  denominu' 
tions,  increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity;  (2)  the 
approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-vear  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
(o)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannually. 


Originnl  maturity  value., 
ssue  price 


Period  after  original  ma- 
turity (beginning  10 
years  after  issue  date) 


First  M  year. . 
3^  to  1  year... 

1  to  IK  years. 
liito'Z  years- 

2  to  23  i  years- 
2J^  to  3  years. 

3  to  syi  years. 
3^2  to  4  years- 

4  to  4}/2  years - 
4M  to  5  years - 

5  to  5}4  years. 
51-i  to  ti  years. 
tito  63.^  years. 


$25. 00 
18.75 


$50. 00 
37.50 


$100. 00 
75.00 


$500.  00 
375.  00 


$1, 000. 00 
750.  00 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  fir-^t  day  of  period  shown) 


First  e.xtended  maturity  iieriod 


$25. 00 
25.37 
25.75 
26.12 
26.50 
26.90 
27.30 
27.70 
28.10 
28.50 
28.95 
29.40 
29.85 


$50. 00 
50.75 
51.50 
52.25 
53.00 
53.80 
54.60 
55.40 
56.20 
57.00 
57.90 
58.80 
59.70 


$100.00 
101.  50 
103. 00 
104.  50 
106. 00 
107. 60 
109. 20 
110. 80 
112.40 
114. 00 
115.80 
117.  60 
119.40 


$500. 00 
507.  50 
515.00 
522.  50 
530. 00 
538. 00 
546. 00 
554. 00 
562. 00 
570. 00 
579.  00 
588. 00 
597. 00 


$1, 000. 00 
1, 015. 00 
1, 030. 00 
1, 045. 00 
1, 060. 00 
1, 076. 00 
1, 092. 00 
1, 108. 00 
1, 124. 00 
1, 140. 00 
1, 158. 00 
1, 176. 00 
1, 194. 00 


Approximate  invest- 
ment  yield  2 


(2)  On 
purchase 
price  from 
issue  date 

to 
beeinning 

of  each 
half-year 

period 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 
2.92 
2.92 
2.93 


(3)   On 
current  re- 
demption 
value  from 
bepimiing 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


Percent 
33.00 
33.00 
33.00 
33.01 
33.02 
3  3. 02 
33.02 
33.03 
33.04 
33.05 
33.04 
33.04 
<3.53 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1, 1959,  revision 


6M  to  7  years 

7  to  73^  years 

7}^  to  8  years 

8  to  8K  years 

8}4  to  9  years 

9  to  93^  years 

93;^  to  10  years 

First  extended  maturity 

value   (10   years   from 
original  maturity  date)*- 


$30. 31 
30.79 
31.29 
31.81 
32.40 
33.02 
33.66 


$60. 62 
61.58 
62.58 
63.62 
64.80 
66.04 
67.32 


$121. 24 
123. 16 
125. 16 
127. 24 
129. 60 
132. 08 
134. 64 


137. 36 


$606. 20 
615. 80 
625. 80 
636. 20 
648. 00 
660. 40 
673. 20 


$1,212.40 
1, 231. 60 
1,  251.  60 
1, 272. 40 
1, 296. 00 
1, 320. 80 
1,346.40 


1, 373. 60 


Period  after  first  extended 
maturity  (beginning  20 
years  after  issue  date) 


First  }4  year 

3^  to  1  years 

1  to  13^  years 

13^  to  2  years 

2  to  23^  years 

2}^  to  3  years 

3  to  33^  years 

33^  to  4  years 

4  to  43^  years 

43^  to  5  years 

5  to  53^  years 

5i4  to  6  years 

6  to  63^  years 

6}i  to  7  years 

7  to  73^  years 

73^  to  8  years 

8  to  83^  years 

83^  to  9  years 

9  to  93^  years 

93^  to  10  years 

Second  extended  matu- 
rity value  (20  years 
from  original  maturity 
date)  8 


Second  extended  maturity  period 


$34. 34 
34.98 
35.64 
36.31 
36.99 
37.68 
38.39 
39.11 
39.84 
40.59 
41.35 
42.13 
42.92 
43.72 
44.54 
45.37 
46.23 
47.09 
47.98 
48.87 


49.79 


69.96 
71.28 
72.62 
73.98 
75.36 
76.78 
78.22 
79.68 
81.18 
82.70 
84.26 
85.84 
87.44 
89.08 
90.74 
92.46 
94.18 
95.96 
97.74 


$137. 36 
139. 92 
142. 56 
145. 24 
147. 96 
150. 72 
153.  56 
156. 44 
159. 36 
162. 36 
165. 40 
168.  52 
171. 68 
174. 88 
178. 16 
181.48 
184. 92 
188. 36 
191.92 
195. 48 


699.  60 
712. 80 
726. 20 
739. 80 
753. 60 
767. 80 
782. 20 
796. 80 
811.80 
827. 00 
842. 60 
858. 40 
874. 40 
890. 80 
907. 40 
924. 60 
941.80 
959. 60 
977. 40 


99.58         199.16         995.80         1,991.60 


$1, 373. 60 
1,  399. 20 
1, 425.  60 
1, 452. 40 
1, 479, 60 
1,  507. 20 
1,  535. 60 
1,564.40 
1,  593. 60 
1, 623. 60 
1, 654. 00 
1,  685. 20 
1, 716. 80 
1,  748.  80 
1, 781.  60 
1, 814. 80 
1, 849. 20 
1, 883. 60 
1, 919. 20 
1, 954. 80 


2.93 
2.94 
2.95 
2.96 
2.98 
3.00 
3.02 


3.05 


3.05 
3.07 
3.08 
3.10 
3.11 
3.13 
3.14 
3.15 
3.17 
3.18 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.27 


3.28 


3.60 
3.67 
3.76 
3.86 
3.91 
3.96 
4.04 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.75 
3.74 
3.77 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1, 1959,  revision. 

<  Approximate  investment  yield  from  eflective  date  of  Jtme  1, 1959,  revision  to  first  extended  maturity. 

» 20  years  from  issue  date.       6  30  years  from  issue  date. 


282   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  VIII.— United  States  Savings  Bonds— Series  E 

Table  of  redemption  values  and  investment  yields  during  extended  maturity  periods  '  for 

bonds  be.\rinq  issue  dvtei  from  december  1,  1943,  through  m.\y  1,  1941 
Table  sho'i'ing:  (/)  Ho'u  bondi  of  Series  E  bearing  issue  dates  from  December  1,  1943,  through  May  1,  19i4,  by 
denorninalions,  inzrease  in  redemption  value  during  successive  half-gear  periods  follo'uing  date  of  original 
maturity;  (2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each 
half-year  period;  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning 
of  each  half-year  period  (a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed 
in  terms  ofiate  percent  per  annum,  compounded  semiannually. 


Original  maturity  value.. 
Issue  price 

$25.  00  1      .$50.  00  1     $100.  00  1     $500.  00  1     $1, 000.  00 
18.  75  1        37.  50  1        75.  00  |      375.  00  |          750.  00 

Approximate  invest- 
ment yield  2 

Period  after  original  ma- 

(1) Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 

(2)  On 
purchase 
price  from 
issue  date 

to 
be.einning 

of  each 
half-year 

period 

(3)  On 
current  re- 
demption 
value  from 
besinning 

turity  (beginning  10 
years  after  issue  date) 

First  extended  maturity  period 

of  each 
half-year 
period  (a) 

to  first 
e.xtended 
maturity 

First  l^  vear 

$25. 00 
25.37 
25.75 
26.12 
26.50 
26.90 
27.30 
27.70 
28.10 
28.50 
28.95 
29.40 

$50. 00 
50.75 
51.50 
52.25 
53.00 
53.80 
54.60 
55.40 
56.20 
57.00 
57.90 
58.80 

$100.00 
101.50 
103. 00 
104.  50 
106.00 
107. 60 
109. 20 
110.  80 
112.40 
114.00 
115.80 
117.60 

$500. 00 
507.  50 
515.00 
522.  50 
530. 00 
538. 00 
546.  00 
554. 00 
562. 00 
570. 00 
579.  00 
588. 00 

$1,000.00 
1,015.00 
1,030.00 
1,045  00 
1,060.00 
1,076.00 
1,092,00 
1,108.00 
1, 124  00 
1,140.00 
1,158.00 
1,176.00 

Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 
2.92 
2.92 

Percent 
33  00 

1^  to  1  year               .  _  .. 

33  00 

1  to  1/4  years    

33  00 

VA  to  2  years 

33.01 

2  to  214  years 

33.02 

2}^  to  3  years    

33.02 

3  to  3K  years    

33  02 

3)^  to  4  years 

33.03 

4  to  4!^  years 

33.04 

4H  to  5  years             

33  05 

5  to  5'.i2  years    

33  04 

5!^  to  6  years 

<3.  54 

Redemption  values  and  investment  yields  to  first  e.xtended  maturity  on  basis  of  June  1,  1959,  revision 


6  to  63^2  years 

6}^  to  7  years 

7  to  7J^  years 

7}^  to  8  years 

8  to  8'i  years 

83^  to  9  years 

9  to  9;-^  years 

93^  to  10  years..- 

First  extended  maturity 

value  (10  years  from 
original  maturity 
date)6 


Period  after  first  extended 
maturity  (besinning  20 
years  after  issue  date) 


First  H  year 

J^  to  1  year 

1  to  VA  years 

114  to  2  years 

2  to  214  years 

2}4  to  3  years 

3  to  314  years 

314  to  4  years 

4  to  4H  years 

4J^  to  5  years 

5  to  5)4  years 

514  to  6  years 

6  to  6,4  years _ 

6H  to  7  years 

7  to  714  years 

714  to  8  years 

8  to  8\4  years 

814  to  9  years 

9  to  914  years 

9>2  to  10  years 

Second  extended  maturi- 
ty value  (20  years  from 
original  maturity 
date)» 


$29.  86 
30.33 
30.83 
31.34 
31.87 
32.  47 
33.09 
33.74 


34.43 


$59. 72 
60.66 
61.66 
62.68 
63.74 
64.94 
66. 18 
67.48 


$119.44 

121. 32 

123. 32 

125. 36 

127. 48 

129.  88 

132.  36 

134. 96 

137.  72 

$597.  20 

606.  60 

616.60 

626.  80 

637.  40 

649.  40 

661.  80 

674.  80 

688.60 

$1,194.40 
1,213.20 
1,233.20 
1,2.'')3.  60 
1,  274. 80 
1,  298.  80 
1, 323.  60 
1,  349.  60 


1, 377. 20 


Second  extended  maturity  period 


$34. 43 
35.08 
35.73 
36.40 
.37. 09 
37.78 
38.49 
39.21 
39. 95 
40.70 
41.46 
42.24 
43.03 
43.83 
44.66 
45.49 
46.35 
47.22 
48.10 
49.00 


49.92 


$68.  86 
70.16 
71.46 
72.80 
74.18 

75.  56 

76.  98 
78.42 
79.90 
81.40 
82.92 
84.48 
86.06 
87.66 
89.32 
90.98 
92.70 
94.44 
96.20 
98.00 


$137.  72 
140.  32 
142. 92 
145.  60 
148.  36 
151.12 
153. 96 
156.  84 
159.  80 
162. 80 
165.  84 
168. 96 
172. 12 
175. 32 
178. 64 
181.96 
185. 40 
188.  88 
192. 40 
196. 00 


109.68 


$688.  60 
701. 60 
714.60 
728. 00 
741,80 
755.  60 
769.  80 
784. 20 
799. 00 
814. 00 
829. 20 
844.  80 
860. 60 
876.  60 
893. 20 
909.  80 
927. 00 
944.  40 
962.  00 
980. 00 


998.  40 


$1.  377.  20 
1,403.20 
1,  429  20 
1,  456.  00 
1, 483.  60 
1,511.20 
1,  539.  60 
1,568.40 
1,  598.  00 
1,628.00 
1,  658.  40 
1,  689.  60 
1,721.20 
1,  753.  20 
1,786.40 
1, 819.  60 
1, 854. 00 
1,  888,  80 
1,  924.  00 
1, 960.  00 


1,996.80 


2.93 
2.94 
2.95 
2.96 
2.97 
2.99 
3.01 
3.04 


3.06 


3.06 
3.08 
3.09 
3.11 
3.12 
3.14 
3.15 
3.16 
3.18 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.28 


3.29 


3.59 
3.66 
3.72 
3.80 
3.90 
3.95 
4.01 
4.09 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.74 
3.75 
3.76 


'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  efl'ective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

» 20  years  from  issue  date.    '  30  years  from  issue  date. 


EXHIBITS 

Table  IX.— United  States  Savinos  Bonds— Series  E 


283 


table    of   redemption   values   and   investment   YTELDS   during    extended    maturity  periods  '    FOR 
BONDS    bearing  ISSUE  DATES    FROM   JUNE    1    THROUOH   NOVEMBER   1,    1944 

Table  showing:  (1)  How  bondi  of  Series  E  bearino  issue  dates  June  1  through  November  1, 19U,  by  denominations, 
increase  in  redemption  value  during  successive  half-year  periods  foUowing  date  of  original  maturity;  (2)  the 
approximate  investment  yield  on  the  purchase  price  from  issue  di.  te  to  the  beginning  of  each  half-year  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
(a1  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannuallii . 


Original  maturity  value. 
Issue  price 


$10. 00 
7.60 


$25. 00 
18.75 


$50.00    $100.00 
37.  50       75. 00 


$500. 00 
375.  00 


$1, 000. 00 
750.  00 


Approximate 
investment  yield  2 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


Period  after  original  ma- 
turity (beginning  10 
years  after  issue  date) 


First  extended  maturity  period 


(2)  On 
purchase 
price  from 
issue  date 
to  begin- 
ning of 

each 

half-year 

period 


(3)  On 

current 
redemption 
value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


First  yi.  year-. 
yi  to  1  year... 
ItoVA  years. 
IJ^  to  2  years. 

2  to  214  years. 
2}4  to  3  years. 

3  to  3}4  years. 
3H  to  4  years. 

4  to  ii4  years. 
4K  to  5  years . 

5  to  Bl-i  years . 


$10. 00 

$25.  00 

$50. 00 

$100. 00 

10.15 

25.37 

50.75 

101.50 

10.30 

25.75 

51. 50 

103. 00 

10.45 

26.12 

52.  25 

104.  50 

10.60 

26.50 

53.00 

106. 00 

10.76 

26.90 

53.80 

107.60 

10.92 

27.30 

54.  60 

109.  20 

11.08 

27.70 

55.  40 

110  80 

11.24 

28.10 

56.20 

112.40 

11.40 

28.50 

57.00 

114.00 

11.58 

2S.  95 

57.90 

115.80 

$500. 00 
507.  SO 
515.00 
522.  50 
530. 00 
538.  00 
546. 00 
554.00 
562. 00 
570. 00 
579.  00 


.$1,000.00 
1,015.00 
1, 030. 00 
1,045.00 
1,060.00 
1,076.00 
1,092.00 
1,108.00 
1,124.00 
1,140.00 
1.158.00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 
2.92 


Percent 
3  3.00 
3  3.00 
33.00 
33.01 
3  3. 02 
33.02 
33,02 
33.03 
33.04 
33.05 
43.54 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


53^  to  6  years 

6  to  6^2  years 

6H  to  7  years 

7  to  7H  years 

7yi  to  8  years , 

8  to  8M  years 

S}4  to  9  years 

9  to  9M  years.. - 

Q^i  to  10  years 

First  extended  maturity 
value  (10  years  from 
original  maturity 
date)' 


Period  after  first  ex- 
tended maturity  (he- 
girming  20  years  after 
issue  date) 


First  yi  year. 

yi  to  1  year 

1  to  VA  years 

lyi  to  2  years 

2  to  2H  years 

2}^  to  3  years 

3  to  syi  years 

syi  to  4  years 

4  to  414  years 

434  to  5  years 

5  to  5J4  years 

5}^  to  6  years 

6  to  634  years. 

6H  to  7  years. 

7  to  734  years 

734  to  8  years 

8  to  834  years 

834  to  9  years 

9  to  934  years 

9J4  to  10  years... 

Second  extended  matu- 
rity value  (20  years 
from  original  maturity 
date)' 


$11.  76 

$29.  41 

$58.  82 

$117.  64 

11.95 

29.88 

59.  76 

119.52 

12.15 

30.37 

60.74 

121.48 

12.35 

30.87 

61.74 

123.  48 

12.  56 

31.39 

62.78 

125.  56 

12.77 

31.93 

63.86 

127.  72 

13.02 

32.54 

65.08 

130. 16 

13.27 

33.17 

66  34 

132.68 

13.53 

33.82 

67.04 

135.28 

13.80 

34.51 

69.02 

138. 04 

$588. 20 
597. 60 
607.  40 
617.  40 
627. 80 
638. 60 
650. 80 
663  40 
676. 40 


$1,176.40 
1,195.20 
1,214.80 
1,234.80 
1,25.5.60 
1, 277.  20 
1,301.60 
1,326.80 
1, 352. 80 


1, 380. 40 


Second  extended  maturity  period 


$13.80 
14.06 
14.33 
14.60 
14.87 
15.15 
15.43 
15.72 
16.02 
16.32 
16.62 
16.93 
17.25 
17.58 
17.90 
18.24 
18.58 
18.93 
19.28 
19.65 


$34.  51 

$69. 02 

$138.04 

35. 16 

70.32 

140. 64 

35.82 

71.64 

143.  28 

36.49 

72.98 

145.96 

37.17 

74.34 

148.  68 

37.87 

75.74 

151.48 

38.58 

77.16 

1.54.  32 

39.30 

78.60 

1.57.20 

40.04 

80.08 

160. 16 

40.79 

81.58 

163.16 

41.55 

83.10 

166.  20 

42.  33 

84.66 

169. 32 

43.13 

86.26 

172.  52 

43.94 

87.88 

175.76 

44.76 

89.52 

179. 04 

45.60 

91.20 

182.  40 

46.45 

92.90 

185. 80 

47.33 

94.  66 

189.  32 

48.21 

96.42 

192.  84 

49.12 

98.24 

196.  48 

50.04 

100.08 

200.16 

$690. 20 
703.  20 
716.  40 
729. 80 
743.  40 
757.  40 
771.60 
786. 00 
800.  80 
815.  80 
831.00 
846. 60 
862. 60 
878.  80 
895. 20 
912. 00 
929.  00 
946.  60 
964. 20 
982. 40 


$1,380.40 
1,406.40 
1,432.80 
1,  459.  60 
1,  486.  80 
1,514.80 
1,  543.  20 
1,572.00 
1,601.60 
1,631  60 
1,662  00 
1,  693.  20 
1,  725.  20 
1,757.60 
1,  790  40 
1,824.00 
1,858.00 
1,893.20 
1,  928.  40 
1,964.80 


1,000.80     2,001.60 


2.93 
2.93 
2.94 
2.95 
2.97 
2.98 
3.00 
3.03 
3.05 


3.07 


3.07 
3.09 
3.11 
3.12 
3.13 
3.15 
3.16 
3.17 
3.19 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.28 
3.29 


3.30 


3.59 
3.63 
3.68 
3.75 
3.83 
3.92 
3.96 
4  00 
4.08 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.76 
3.75 
3.76 
3.75 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Appro.\imate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Appro.vimate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

6  20  years  from  issue  date.       « 30  years  from  issue  date. 


614359—62- 


-19 


284 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  X.— United  States  Savincs  Bonds— Series  E 

TABLE  OF  REDEMPTION  VALTIES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIODS  '  FOR  BONDS 
BEARING  ISSUE  DATES  FROM  DECEMBER  1,  1944,  THROUGH  MAY  1,  1945 

Table  showing:  (1)  Jloni  bonds  of  Series  E  bearing  issue  dates  December  1,  19i4,  through  May  1,  1945,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity; 
(2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period;  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannually. 


Original  maturity  value. 
Issue  price 


Period  after  original  ma- 
turity (beginning  10 
years  after  issue  date) 


$10.00     $25.00     $50.00  I  $100. 00 
7. 50       18. 75       37. 50       75. 00 


$500.00    $1,000.00 
375. 00         750. 00 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


First  extended  maturity  period 


Appro.ximate 
investment  yield  2 


(2)  On 
purchase 
price  from 
issue  date 
to  begin- 
ning of 

each 

half-year 

period 


(3)  On 

current 

redemption 

value  from 

beginning 

of  each 

half-year 

period  (a) 

to  first 
extended 
maturity 


First  yi  year- 
H  to  1  year... 

1  to  IH  years - 
l>i  to  2  years. 

2  to  2>^  years. 
'lyi  to  3  years. 

3  to3>i  years - 
33^  to  4  years. 

4  to  4J^  years. 
4K  to  5  years. 


$10.00 

$25.00 

$50. 00 

$100.  00 

10.15 

25.37 

50.75 

101.  50 

10.30 

25.75 

51.50 

103. 00 

10.45 

26. 12 

52. 25 

104.  50 

10.60 

26.50 

53.00 

106. 00 

10.76 

26.90 

53.80 

107.  60 

10.92 

27.30 

54.60 

109.  20 

11.08 

27.70 

55.40 

110.80 

11.24 

28.10 

56.20 

112.40 

11.40 

28.50 

57.00 

114.00 

$500. 00 
507.  50 
515.00 
522.  50 
530. 00 
538.00 
546. 00 
554. 00 
562. 00 
570. 00 


$1, 000. 00 
1,015.00 
1, 030. 00 
1, 045. 00 
1, 060. 00 
1,076.00 
1, 092. 00 
1,108.00 
1,124.00 
1. 140. 00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 
2.91 


Percent 
33.00 
33.00 
33.00 
33.01 
33.02 
83.02 
33.02 
33.03 
33.04 
<3.55 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1, 1959,  revision 


5  to  5H  years 

bVi  to  6  years 

6  to  ^Vi  years... 

6M  to  7  years 

7  to  7]/2  years 

iVi  to  8  years 

8  to  9,^2  years 

8J^  to  9  years 

9  to  'dyi  years.. 

9H  to  10  years 

First  extended  maturity 

value  (10  years  from 
original  maturity 
date)  5 


Period  after  first  ex- 
tended maturity  (be- 
ginning 20  years  after 
issue  date) 


First  Vz  year 

]-2  to  1  year... 

1  to  V/i  years. 

lYi  to  2  years 

2  to  2}^  years 

23^  to  3  years 

3  to  33^  years 

33^  to  4  years 

4  to  4}^  years 

4}^  to  5  years 

5  to  53^  years 

bYi  to  6  years 

6  to  63^  years 

63^  to  7  years... 

7  to  73i  years 

IM  to  8  years 

8  to  83^  years 

83^  to  9  years 

9  to  93^  years. 

93^  to  10  years 

Second  extended  matu- 
rity value  (20  years 
from  original  matuiity 
date)  ° ..-- 


$11.58 

$28. 96 

$57.92 

$115.84 

11.77 

29.43 

58.86 

117.72 

11.96 

29.91 

59.82 

119. 64 

12.16 

30.41 

60.82 

121. 64 

12.37 

30.92 

61.84 

123.  68 

12.58 

31.46 

62.  92 

125. 84 

12.  80 

32.00 

64.00 

128. 00 

13.05 

32. 62 

65.24 

130. 4S 

13.30 

33.25 

66.50 

133. 00 

13.56 

33.90 

67.80 

135.  60 

13.84 

34.59 

69.18 

138. 36 

$579. 20 
588. 60 
598. 20 
608. 20 
618. 40 
629. 20 
640.  00 
652. 40 
665. 00 
678. 00 


U,  158.  40 
1, 177.  20 
1, 196. 40 
1,216.40 
1, 236. 80 
1, 258. 40 
1,280.00 
1, 304.  80 
1, 330. 00 
1, 356. 00 


Second  extended  maturity  period 


$13. 84 
14.10 
14.36 
14.63 
14.90 
15.18 
15.47 
15.76 
16.05 
16.35 
16.66 
16.97 
17.29 
17.62 
17.94 
18.28 
18.62 
18.98 
19.33 
19.69 


20.06 


$34.  59 
35.24 
35.90 
36.57 
37. 26 
37.96 
38.67 
39.39 
40.13 
40.88 
41.65 
42.43 
43.23 
44.04 
44.86 
45.71 
46.56 
47.44 
48.32 
49.  23 


$69. 18 
70.48 
71.80 
73.14 
74.52 
75.92 
77.34 
78.78 
80.26 
81.76 
83.30 
84.86 
86.46 
88.08 
89.72 
91.42 
93.12 
94.88 
96. 64 
98.46 


$138. 36 
140. 96 
143.  60 
146. 28 
149. 04 
151.84 
154.  68 
157.  56 
160.  52 
163.  52 
166.  60 
169.  72 
172.  92 
176. 16 
179. 44 
182.  84 
186. 24 
189.  76 
193.  28 
196. 92 


50. 15     100.  30     200.  00     1, 003. 00     2, 006. 00 


$691. 80 
704. 80 
718.00 
731.40 
745.  20 
759. 20 
773. 40 
787. 80 
802.  60 
817. 60 
833. 00 
848. 60 
864.  60 
880.  80 
897. 20 
914. 20 
931.20 
948. 80 
966. 40 
984.  60 


$1, 383.  60 
1, 409.  60 
1, 436. 00 
1,  462.  80 
1,  490. 40 
1,518.40 
1,  546.  80 
1,  575.  60 
1, 605. 20 
1, 635. 20 
1,  666. 00 
1,  697. 20 
1, 729. 20 
1,761.60 
1,  794. 40 
1,828.40 
1, 862. 40 
1, 897. 60 
1, 932.  80 
1,  969. 20 


2.92 
2.93 
2.94 
2.95 
2.96 
2.98 
2.99 
3.02 
3.04 
3.06 


3.09 


3.09 
3.10 
3.12 
3.13 
3.15 
3.16 
3.17 
3.18 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.27 
3.28 
3.29 
3.30 


3.31 


3.58 
3.62 
3.67 
3.71 
3.77 
3.83 
3.93 
3.95 
3.99 
4.07 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.75 
3.74 
3.75 
3.74 


'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959. 

'  Calculated  on  basis  of  $1,000  bond  (face  value). 

'  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity,  at 
first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

♦  Approximate  investment  yield  from  effective  date  of  June  1,  1959,  revision,  to  first  extended  maturity. 

«  20  years  from  issue  date.       *  30  years  from  issue  date. 


EXHIBITS 


285 


Table  XI.— United  States  Savings  Bonds— Series  E 

TABLE    OP    EEDEMPTION   VALUES   AND   INVESTMENT    YIELDS    DURING    EXTENDED    MATURITY    PERIODS  1   FOR 
BONDS   BEARINO  ISSUE  DATES   FROM  JUNE  1   THROUGH   NOVEMBER   1,    1945 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dates  June  I  fhrougk  November  1,  i9Jt5,  by  denominations, 
increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity;  (2)  the 
approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
(a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannually. 


Original  maturity 
value 

Issue  price 


Period  after  orig- 
inal maturity 
(beginning  10 
years  after  issue 
date) 


$10. 00 
7.50 


$25.  00 
18.  75 


$50.00    $100.00    $200.00 
37.  50       75.  00      150. 00 


$500.00    $1,000.00 
375.00  I       750.00 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


First  extended  maturity  periocl 


Approximate  invest- 
ment yield  2 


(2)  On 
purchase 
price 
from 
issue 
date  to 
begin- 
ning of 

each 

half-year 

period 


(3)  On 

current 

redemption 

value  from 

beginning 

of  each 

half-year 

period  (a) 

to  first 
extended 
maturity 


First  14  year.. 
J^to  1  year--. 

1  to  \}/2  years - 
13^  to  2  years - 

2  to  2>^  years - 
2J^  to  3  years - 

3  to  Z]4  years  - 
3J^  to  4  years--. 

4  to  43^  years--- 


$10.00 

$25.00 

$50.00 

$100.00 

$200. 00 

10.15 

25.37 

50.75 

101. 50 

203.00 

10.30 

25.75 

51.50 

103. 00 

206.00 

10.45 

26.12 

52.25 

104. 50 

209. 00 

10.60 

26.50 

53.00 

106.00 

212. 00 

10.76 

26.90 

53.80 

107. 60 

215. 20 

10.92 

27.30 

54.60 

109. 20 

218.40 

11.08 

27.70 

55.40 

110. 80 

221. 60 

11.24 

28.10 

56.20 

112. 40 

224. 80 

$500. 00 
507.  50 
515.00 
522. 50 
530. 00 
538. 00 
546.00 
554.00 
562. 00 


$1, 000. 00 
1,015.00 
1,030.00 
1,045.00 
1,060.00 
1,076.00 
1,092.00 
1,108.00 
1,124.00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 
2.91 
2.91 


Percent 
33.00 
33.00 
33.00 
S3. 01 
33.02 
33.02 
33.02 
33.03 
13.54 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


43^  to  5  years 

5  to  5K  years 

53i  to  6  years 

6  to  6H  years 

63^  to  7  years 

7  to  73^  years 

73^  to  8  years 

8  to  834  years 

834  to  9  years 

9  to  934  years 

93^  to  10  years 

First  extended 

maturity  value 
(10  years  from 
original  maturi- 
ty date)  5 


Period  after  first 
extended  maturi- 
ty (beginning  20 
years  after  issue 
date) 


First  34  year 

3-4  to  1  year 

1  to  134  years 

134  to  2  years 

2  to  234  years 

3^  to  3  years 

3  to  3}4  years 

334  to  4  years 

4  to  43^  years 

43^  to  5  years 

5  to  5^2  years 

534  to  6  years 

6  to  634  years 

634  to  7  years 

7  to  73^  years 

734  to  8  years 

8  to  834  years 

834  to  9  years 

9  to9>4  years 

934  to  10  years 

Second  extended 

maturity  value 
(20  years  from 
original  maturi- 
ty  date)  ^ 


$11.40 
11.59 
11.78 
11.98 
12.18 
12.39 
12.61 
12.83 
13.08 
13.33 
13.60 


13.87 


$28. 51 

$57.02 

$114.04 

$228.08 

28.97 

57.94 

115. 88 

231.76 

29.46 

58.92 

117.84 

235.  68 

29.95 

59.90 

119.80 

239.  60 

30.46 

60.92 

121.84 

243. 68 

30.98 

61.96 

123. 92 

247. 84 

31.52 

63.04 

126. 08 

252. 16 

32.07 

64.14 

128. 28 

256. 56 

32.69 

65.38 

130. 76 

261.52 

33.33 

66.66 

133. 32 

266.64 

33.99 

67.98 

135. 96 

271. 92 

34.68 

69.36 

138. 72 

277. 44 

$570. 20 
579. 40 
589. 20 
599.00 
609. 20 
619. 60 
630. 40 
641. 40 
653. 80 
666. 60 
679. 80 


$1,140.40 
1,158.80 
1, 178. 40 
1,198.00 
1, 218. 40 
1,239.20 
1, 260. 80 
1, 282. 80 
1,307.60 
1,333.20 
1, 359. 60 


Second  extended  maturity  period 


$13.87 

$34.68 

$69.36 

$138. 72 

$277. 44 

14.13 

35.33 

70.66 

141.32 

282. 64 

14.40 

35.99 

71.98 

143. 96 

287.92 

14.67 

36.67 

73.34 

146. 68 

293. 36 

14.94 

37.36 

74.72 

149.  44 

298. 88 

15.22 

38.06 

76.12 

152. 24 

304.48 

15.51 

38.77 

77.54 

155. 08 

310. 16 

15.80 

39.50 

79.00 

158.00 

316.00 

16.10 

40.24 

80.48 

160. 96 

321. 92 

16.40 

40.99 

81.98 

163. 96 

327. 92 

16.70 

41.76 

83.52 

167.04 

334.08 

17.02 

42.54 

85.08 

170. 16 

340. 32 

17.34 

43.34 

86.68 

173.36 

346.  72 

17.66 

44.15 

88.30 

176. 60 

353. 20 

17.99 

44.98 

89.96 

179. 92 

359. 84 

18.33 

45.82 

91.64 

183. 28 

366.  56 

18.67 

46.68 

93.36 

186.  72 

373. 44 

19.02 

47.56 

95.12 

190.24 

380. 48 

19.38 

48.45 

96.90 

193. 80 

387. 60 

19.74 

49.36 

98.72 

197.44 

394. 88 

20.11 

50.28 

100. 56 

201.12 

402. 24 

$693. 60 
706. 60 
719. 80 
733. 40 
747. 20 
761.20 
775. 40 
790.00 
804. 80 
819. 80 
835. 20 
850. 80 
866. 80 
883.00 
899.  60 
916.  40 
933. 60 
951.20 
969. 00 
987. 20 


$1, 387. 20 
1, 413. 20 
1. 439. 60 
1, 466. 80 
1,494.40 
1, 522. 40 
1,550.80 
1,580.00 
1, 609. 60 
1, 639. 60 
1,670.40 
1,701.60 
1. 733. 60 
1,766.00 
1,  799. 20 
1, 832.  80 
1,  867. 20 
1,902.40 
1,938.00 
1, 974. 40 


2.91 
2.92 
2.94 
2.95 
2.96 
2.98 
2.99 
3.00 
3.03 
3.05 
3.07 


3.10 


3.10 
3.11 
3.13 
3.14 
3.16 
3.17 
3.18 
3.20 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.28 
3.29 
3.30 
3.31 


3.32 


3.59 
3.63 
3.66 
3.70 
3.74 
3.80 
3.86 
3.95 
3.98 
4.01 
4.06 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.74 
3.73 


'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        ■  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  .Tune  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

4  20  years  from  issue  date.       « 30  years  from  issue  date. 


286   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  XII.— United  States  Savings  Bonds— Series  E 

TABLE  OF  redemption  VAI  UES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIODS  ■  FOB  BONDS 
BEARING  ISSUE  DATES  FROM  DECEMBER  1,  19+5,  TUROUGH  MAT  1,  1946 

Table  showing:  (1)  How  bond'i  of  Series  E  bearing  issue  dates  December  I,  1945,  through  May  1,  19 j8,  by  denomi- 
nalions,  increase  in  redemption  value  during  successive  half-year  periods  foUoving  date  of  original  maturity: 
(2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (ft)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannually. 


Original  maturity 
value 

$10. 00 

$25. 00 

$50. 00 

$100.  00 

$200. 00 

$500. 00 

$1, 000  00 

Approximate  invest- 
ment yield  2 

Issue  price 

7.50 

18.  75 

37.  50 

75.00 

150.  00 

375. 00 

750. 00 

(2)    On 

(3)  On  cur- 

(1) Redemption  values  during  each  half-year  period 

purchase 

rent  re- 

(Values increase  on  first  day  of  period  shown) 

p.  ice 

demption 

Period  after  orig- 

from issue 

value  from 

inal      maturity 

date  to 
begin- 

beginning 

(beginning      1 0 

of  each  half- 

years  after  issue 

ning  of 

year  period 

date) 

First  extended  maturity  period 

each  half- 
year 
period 

(a)  to  first 
extended 
maturity 

Percent 

Percent 

First  Kyear 

$10. 00 

$25.  00 

$50.  00 

$100.00 

$200. 00 

$500  00 

.$1,000.00 

2.90 

3  3.00 

}i2  to  1  year 

10.15 

25.37 

50.  75 

101.50 

203.  no 

507.  50 

1,015,00 

2.90 

3  3.00 

1  to  13^  years 

10.30 

25.75 

51.50 

103.  00 

206  00 

515  00 

1,030.00 

2.90 

3  3.00 

V/i  to  2  years 

10.  45 

26. 12 

52.  25 

104.  50 

209.  00 

522.  50 

1. 045. 00 

2.91 

3  3.01 

2  to  2}^  years 

10.60 

26.50 

53.00 

106. 00 

212.00 

530.  00 

1, 060. 00 

2.90 

3  3.02 

2>^  to  3  years 

10.76 

26.90 

53.80 

107.  60 

215.20 

538.  00 

1, 076. 00 

2.91 

3  3.02 

3  to  33-^  years 

10. 92 

27.30 

54.60 

109. 20 

218.  40 

546. 00 

1, 092. 00 

2.91 

3  3.02 

3'-^  to  4  years 

11.08 

27.  70 

55.40 

110.80 

221.  60 

554. 00 

1,108.00 

2.91 

*  3.  53 

a;  2  to  4  years ii.un        z/.  w        oo.  hu      iju.  gu      z,ii.Du oot.  uu      !,  luo.  uu z.  ai ^  o.  i'o 

Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


4  to  4H  years 

i}4  to  5  years 

5  to  5}i  years 

5K  to  6  years 

6  to  6H  years 

6M  to  7  years 

7  to  7^2  years 

7H  to  8  years 

8  to  8H  years 

S}4  to  9  years 

9  to  91/4  years 

9Vn  to  10  years 

First       extended 

maturity  value 
(10  years  from 
original  matu- 
rity  date)  ' 


Period  after  first 
extended  ma- 
turity (begin- 
ning 20  years 
after  issue  date) 


First  14  year 

H  to  1  year 

1  to  1}^  years 

VA  to  2  years 

2  to  2,V4  years 

2>/^  to  3  years 

3  to  3H  years 

314  to  4  years 

4  to  4}4  years 

4>2  to  5  years 

5  to  5J^  years 

514  to  6  years 

6  to  6M  years 

6}-^  to  7  years 

7  to  7M  years 

7J^  to  8  years 

8  tc  8H  years 

S14  to  9  years 

9  to  9J^  years 

91-i  to  10  years 

Second   extended 

maturity  value 
(20  years  from 
original  matu- 
rity  date)  ° 


$11.24 

$28. 11 

$.56.  22 

,$112.  44 

$224.  88 

11.41 

28.52 

57.04 

114.08 

228. 16 

11.60 

29.00 

58.00 

116.00 

232. 00 

11.80 

29.49 

58.  98 

117.96 

235.  92 

12.00 

29.99 

59. 98 

119.96 

239.  92 

12.20 

30.51 

61.02 

122. 04 

244.08 

12.42 

31.04 

62. 08 

124. 16 

248.  32 

12.63 

31.58 

63.16 

126,  32 

252.  64 

12.86 

32.14 

64.28 

128.  56 

257. 12 

13.11 

32.77 

65.  54 

131.08 

262. 16 

13.36 

33.41 

66.  82 

133. 64 

267. 28 

13.63 

34.07 

68.14 

136. 28 

272.  56 

13.91 

34.77 

69.54 

139. 08 

278. 16 

$562. 20 
570.  40 
580.  00 
589.  SO 
599.  80 
610.20 
620.  80 
631.60 
642.  SO 
655.  40 
668.  20 
681.40 


695. 40 


$1, 124.  40 
1.140  SO 
1, 160  00 
1, 179.  60 
1,199.60 
1, 220.  40 
1,241.60 
1,263.20 
1,285.60 
1,  310.  80 
1, 336.  40 
1, 362. 80 


1. 390.  80 


Second  extended  maturity  period 


$13.91 

$34.  77 

$69.  54 

$139. 08 

$278. 16 

14.17 

35.42 

70.84 

141.68 

283.  36 

14.44 

36.09 

72. 18 

144.36 

288.  72 

14.70 

36.76 

73. 52 

147.04 

294. 08 

14.98 

37.45 

74.90 

149.  80 

299.  60 

15.26 

38.15 

76,30 

152. 60 

305.  20 

15.55 

38.87 

77.74 

1.55.  48 

310.96 

15.84 

39.60 

79.20 

158.  40 

316.80 

16.14 

40.34 

80.68 

161.36 

322.  72 

16.44 

41.10 

82.20 

164.40 

328.  80 

16.  75 

41.87 

83.74 

167.  48 

334. 96 

17.06 

42.65 

85.30 

170.60 

341.20 

17.38 

43.45 

86.  90 

173.  80 

347. 6'^ 

17.71 

44  27 

88  54 

177.08 

354. 16 

18.04 

45.10 

90.20 

180.  40 

360.  80 

18.38 

45.94 

91  8S 

183.  76 

367.  52 

18.72 

46.80 

93.60 

187.  20 

374. 40 

19.07 

47.68 

95.36 

190.  72 

381.  44 

19.43 

48.58 

97.16 

194,  32 

388. 64 

19.80 

49.49 

98.98 

197. 96 

395. 92 

20.16 

50.41 

100.  82 

201.64 

403,  28 

$695. 40 
708.  40 
721.  80 
735. 20 
749. 00 
763. 00 
777.  40 
792,  00 
806.  80 
822. 00 
837.  40 
853. 00 
869  00 
885,  40 
902,  00 
918. 80 
936. 00 
953.  60 
971. 60 
989. 80 


$1. 390.  SO 
1,416.80 
1,  443. 60 
1,  470  40 
1,  498,  00 
1,  526.  00 
1, 554.  80 
1, 584. 00 
1, 613.  60 
1, 644,  00 
1, 674.  80 
1,  706. 00 
1, 738. 00 
1,770.  SO 
1,804.00 
1, 837.  60 
1, 872. 00 
1, 907. 20 
1,943.20 
1, 979. 60 


2.91 
2,91 
2.93 
2.94 
2.96 
2.97 
2.99 
3.00 
3,02 
3.04 
3,06 
3.09 


3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3  27 
■3.28 
3.29 
3.29 
3.30 
3.31 
3.32 


3.32 


3.58 
3.64 
3.66 
3.69 
3.73 
3.77 
3.82 
3.89 
3.97 
3.99 
4.03 
4.11 


(b)   to 

second  ex- 
tended 

matm-ity 


3.75 
3.75 
3.75 
3.75 


3.75 
3.75 
3.75 
.3.75 
3.75 
3.75 
3.74 
3.75 
3.75 
3.75 
3.73 
3.72 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  ba-sls  of  $1,000  bond  fface  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  pericd  to  first  extended  maturity,  at 
first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1,  1959,  revision  to  first  extended  maturity. 

•  20  years  from  Issue  date        «  30  years  from  i  ssue  date. 


EXHIBITS 


287 


Table  XIII.— United  States  Savings  Bonds— Series  E 

TABLE  OF  redemption  VALUES  AND  INVESTMENT  YIELDS  DURINn  EXTENDED  MATURITY  PERIODS  '    FOR  BONDS 
BEAEINO  ISSUE  DATES   FRO.M   JUNE   1    THROUOH   NOVEMRER   1,    1946 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dates  June  1  through  November  1, 1946,  by  denominations, 
increase  in  redemption  value  during  successive  half-year  periods  following  date  of  oriqinal  maturity;  {2)  the 
approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  ofeaih  half-year  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
la)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannually. 


Original  maturity 
value  .    

$10. 00 
7.50 

$25. 00 
18.75 

$50. 00 
37.50 

$100.  00 
75.00 

$200.  00 
150.  00 

$500.  00 
375.  00 

$1, 000. 00 
750. 00 

Approximate  invest- 
ment yield  2 

Issue  price 

Period  after  orig- 

(1) Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 

(2)  On 

purchase 

price 

from 

issue 

date  to 

beain- 

ning  of 

each 

half-year 

period 

(3)  On 

current 

redemption 

value  from 

inal  maturity 
(beginning  10 
years  after  issue 
date) 

First  extended  maturity  period 

be'-'inning 

of  each 

half-year 

period  (a) 

to  first 
extended 
maturity 

First  M  year 

H  to  1  year 

1  to  \]4  years 

IH  to  2  years 

2  to  2H  years 

2]4  to  3  years 

3  to  3.^  years 

$10.00 
10.15 
10.30 
10.45 
10.60 
10.76 
10.92 

$25. 00 
25.37 
25.75 
26.12 
26.50 
26.90 
27.30 

$50.00 
50.75 
51.50 
52.25 
53.00 
53.80 
54.60 

$100. 00 
101.50 
103. 00 
104.  50 
106.00 
107.  60 
109.  20 

$200. 00 
203.00 
206. 00 
209. 00 
212. 00 
215.  20 
218.  40 

$500. 00 
507.  50 
515.00 
522.  50 
530. 00 
538. 00 
546. 00 

$1,000.00 
1,015.00 
1,030.00 
1,045.00 
1, 060. 00 
1,076.00 
1.092.00 

Percent 
2.90 
2.90 
2.90 
2.91 
2.90 
2.91 
2.91 

Percent 
3  3.00 
3  3.00 
3  3.00 
3  3.01 
3  3.02 
33.02 
43.52 

Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


314  to  4  years 

4  to  4}  2  years 

4}^  to  5  years 

5  to  5J-2  years 

5J^  to  6  years 

6  to  %}i  years 

63^  to  7  years 

7  to  7J-2  years 

7;^  to  8  years 

8  to  8J^  years 

8}-^  to  9  years 

9  to  9K  years 

9}^  to  10  years 

First   extended 

maturity  value 
(10  years  from 
original  matu- 
rity  date)' 


Period  after  first 
extended  maturi- 
ty (beginning  20 
years  after  issue 
date) 


First  yi  year 

V^  to  1  year 

1  to  13^  years 

1 H  to  2  years 

2  to  23^2  years 

2J^  to  3  years 

3  to  zyi  years 

33^  to  4  years 

4  to  4K  years 

4K  to  5  years 

5  to  5^2  years 

5J^  to  6  years 

6  to  63^  years 

63^  to  7  years 

7  to  73^  years 

73-2  to  8  years 

8  to  83^  years 

83^  to  9  years 

9  to  934  years 

93^  to  10  years 

Second  extended 

maturity  value 
(20  years  from 
original  matu- 
rity date)" 


$11.08 

$27.  71 

$55.  42 

.$110.84 

$221.68 

11.25 

28.12 

56.24 

112.48 

224.  96 

11.42 

28.55 

57.10 

114.20 

228. 40 

11.61 

29.03 

58.06 

116.12 

232.  24 

11.81 

29.53 

59.06 

118.12 

236.24 

12.02 

30.04 

60.08 

120. 16 

240.  32 

12.23 

30.57 

61.14 

122. 28 

244.  56 

12.44 

31.10 

62.20 

124.  40 

248. 80 

12.66 

31.65 

63.30 

126.  60 

253.  20 

12.89 

32.22 

64.44 

128.  88 

257.  76 

13.14 

32.84 

65.68 

131.36 

262.  72 

13.40 

33.49 

66.98 

133.  96 

267. 92 

13.66 

34.15 

68.30 

136. 60 

273. 20 

13.94 

34.85 

09.70 

139. 40 

278. 80 

$554. 20 
562.  40 
571.00 
580. 60 
590.  60 
600.  80 
611.40 
622. 00 
633. 00 
644.  40 
656.  80 
669.  80 
683. 00 


$1,  lOS.  40 
1,124.80 
1,142.00 
1,161.20 
1,181.20 
1,201.60 
1, 222.  80 
1,244.00 
1,266.00 
1,  288.  80 
1,313.60 
1, 339. 60 
1, 366. 00 


697.00      1,394.00 


Second  extended  maturity  period 


$13.  94 

$34.  85 

$69.  70 

$139.  40 

$278.  80 

14.20 

35.50 

71.00 

142.  00 

284. 00 

14.47 

36.17 

72.34 

144.  68 

289. 36 

14.74 

36.85 

73.70 

147.  40 

294.  80 

15.02 

37.54 

75.08 

150. 16 

300. 32 

15.30 

38.24 

76.48 

152.96 

305. 92 

15.58 

38.96 

77.92 

155. 84 

311.68 

15.88 

39.69 

79.38 

158.  76 

317.52 

16.17 

40.43 

80.86 

161.72 

323.  44 

16.48 

41.19 

82. 38 

164.  76 

329.  52 

16.78 

41.96 

83.92 

167. 84 

335.  68 

17.10 

42.75 

85.50 

171.00 

342.00 

17.42 

43.55 

87.10 

174. 20 

348. 40 

17.75 

44.37 

88.74 

177.48 

354.  96 

18.08 

45.20 

90.40 

180. 80 

361.60 

18.42 

46.05 

92.10 

184. 20 

368.  40 

18.76 

46.91 

93.82 

187.  64 

375.  28 

19.12 

47.79 

95.  58 

191.16 

382. 32 

19.48 

48.  69 

97.38 

194.76 

389.  52 

19.84 

49.60 

99.20 

198. 40 

396. 80 

20.21 

50.53 

101.06 

202. 12 

404.  24 

$697. 00 

710. 00 

723.  40 

737. 00 

750.  80 

764.  80 

779. 20 

793.  80 

808. 60 

823.  80 

839.  20 

855.00 

871.00 

887.  40 

904. 00 

921.00 

938. 20 

955.  80 

973.  80 

992. 00 

,010.60 

$1,394.00 
1, 420. 00 
1,  446.  80 
1,474.00 
1,501.60 
1,529.60 
1,558.40 
1,  587. 60 
1,617.20 
1,647.60 
1,  678. 40 
1,710.00 
1,742.00 
1,  774. 80 
1,  808. 00 
1,842.00 
1,876.40 
1,911.60 
1,947.60 
1, 984  00 


2.91 
2.92 
2.92 
2.94 
2.95 
2.97 
2.98 
3.00 
3.01 
3.03 
3.05 
3.08 
3.10 


3.12 
3.14 
3.15 
3.17 
3.18 
3.19 
3.21 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.29 
3.30 
3.31 
3.32 
3.32 


3.33 


3.56 
3.61 
3.66 
3.69 
3.72 
3.75 
3.78 
3.83 
3.89 
3.96 
4.00 
4.02 
4.10 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.75 


'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity,  at 
first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

<  Approximate  investment  yield  from  effective  date  of  June  1,  1959,  revision  to  first  extended  maturity. 

'  20  years  from  issue  date.       «  30  years  from  issue  date. 


288 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  XIV.— United  States  Savings  Bonds— Series  E 

TAPLE  OF  REDEMPTION  VALUES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIOD  •  FOR  BONDS 
BEARING  ISSUE   DATES   FROM   DECEMBER   1,    1946,   THROUGH   MAY   1,    1947 

Table  showing:  (1)  Hoio  bonds  of  Series  E  bearing  issue  dates  December  1,  194S,  through  May  1,  19i7,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity: 
(2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannually . 


Original  maturity 

Approximate  invest- 

value  

$10.  00 

$25.  00 

$50. 00 

$100.  00 

$200.  00 

$500.00    $1,000.00 

ment  jield  2 

Issue  price 

7.50 

18.75 

37.50 

75.00 

150.00         375.00  1       750.00 

(2)   On 

purchase 

price 

from 

(1) 

Redemption  values  during  each  half-year  period 

(3)   On 

current 

redemption 

(Values  increase  on  first  day  of  period  shown) 

Period  after  orig- 

value from 

inal  maturity 

issue 

beginning 

(beginning  10 

date  to 

of  each 

years  after  issue 

First  extended  maturity  period 

besin- 

half-year 

date) 

ning  of 

each 

half-year 

I)eriod 

period  (a) 

to  first 
extended 
maturity 

1 

Percent 

Percent 

First  14  year 

$10. 00 

$25. 00 

$50. 00 

$100. 00 

$200.  00 

$500. 00 

$1,000.00 

2.90 

3  3.00 

J^  to  1  year 

10.15 

25.  37 

50.  75 

101.50 

203.  00 

507. 50 

1,015.00 

2.90 

3  3.00 

1  to  IH  years 

10.30 

25.75 

51.50 

103. 00 

206. 00 

515.00 

1,030.00 

2.90 

3  3.00 

1^  to  2  years..   .. 

10.45 

26.12 

52.25 

104.  50 

209. 00 

522.  50 

1, 045. 00 

2.91 

33.01 

2  to  2M  years 

10.60 

26.50 

53.00 

106. 00 

212. 00 

530. 00 

1,060.00 

2.90 

33.02 

23^  to  3  years 

10.76 

26.90 

53.80 

107. 60 

215.20 

538. 00 

1,  076. 00 

2.91 

«3.52 

Redemption  values  and  investment  yields  to  first  extendeil  maturity  on  basis  of  June  1,  1959.  revision 


3  to  3V$  years,. 

3j/^  to  4  years 

Mo  iVz  years 

■^J^  to  5  years 

5  to  5J^  years 

5}/^  to  6  years 

6  to  6  J^  years 

Hyi  to  7  years 

7  to  7J^  years 

7}^  to  8  years 

8  to  8}^  years 

8J^  to  9  years 

9  to  914  years 

9}/2  to  10  years 

First  extended 

maturity  value 
(10  years  from 
original  matu- 
rity  date)° 


Period  after  first 
extended  maturi- 
ty (beginning  20 
years  after  issue 
date) 


First  }'<2  year 

J-2  to  1  year 

1  to  l}-2  years 

1}^  to  2  years 

2  to  2J^  years 

2J4  to  3  years 

3  to  3J/^  years 

syi  to  4  years 

4  to  4)^  years 

4}4  to  5  years 

5  to  5}4  years 

514  to  6  years 

6  to  6H  years 

6H  to  7  years 

7  to  7H  years 

7}-i  to  8  years 

8  to8H  years 

8Vi  to  9  years 

9  to  9}^  years 

9,4  to  10  years 

Second  extended 

maturity  value 
(20  years  from 
original  matu- 
rity date)8 


$10.  92 
11.09 
11.26 
11.43 
11.63 
11.83 
12.04 
12.25 
12.47 
12.69 
12.92 
13.17 
13.43 
13.69 


$27.  31 

$54.  62 

$109.  24 

$218. 48 

27.72 

55.44 

110.88 

221.  76 

28.14 

56.28 

112.56 

225. 12 

28.58 

57.16 

114.32 

228.  64 

29.07 

58.14 

116.28 

232.  56 

29.58 

59. 16 

118.32 

336.  64 

30.09 

60.18 

120.36 

240.  72 

30.62 

61.24 

122.48 

244.  96 

31.17 

62.34 

124.  68 

249.  36 

31.72 

63.44 

126.88 

253.  76 

32.29 

64.58 

129. 16 

258.  32 

32. 92 

65.84 

131.68 

263.  36 

33.57 

67.14 

134.  28 

268.  56 

34.23 

68.  46 

136.  92 

273.  84 

34.94 

69.88 

139.  76 

279.  52 

$546.  20 

554.  40 

562.  80 

571 

60 

581 

40 

591 

60 

601 

80 

612 

40 

623 

40 

(i34 

40 

645 

80 

658.40  1 

671 

40 

684.  60 

698. 80 

.$1,092.40 
1,108.80 
1,125.60 
1,143.20 
1, 162. 80 
1, 183.  20 
1,  203.  60 
1,  224.  80 
1,  246.  80 
1,  268.  80 
1,291.60 
1,316.80 
1,342.80 
1,  369.  20 


Second  extended  raaturitj'  perioi 


$13.98 

$34.  94 

$69.  88 

$139.  76 

$279.  52 

14.24 

35.60 

71.20 

142.  40 

284. 80 

14.50 

36.26 

72.  52 

145.  04 

290. 08 

14.78 

36.94 

73.88 

147.  76 

295.  52 

15.06 

37.64 

75.28 

150.  56 

301.12 

15.34 

38.34 

76.68 

153.  36 

306.  72 

15.62 

39.06 

78.12 

156.  24 

312.  48 

15.92 

39.79 

79. 58 

159. 16 

318.  32 

16.22 

40.  54 

81.08 

102.16 

324.  32 

16.52 

41.30 

82.60 

165.  20 

330. 40 

16.83 

42.07 

84.14 

168.  28 

336.  56 

17.14 

42.86 

85.72 

171.44 

342.  88 

17.47 

43.67 

87.34 

174.68 

349.  36 

17.79 

44.48 

88.96 

177.  92 

355. 84 

18.13 

45.32 

90.64 

181.  28 

362. 56 

18.47 

46.17 

92.34 

184.  68 

369.  36 

18.81 

47.03 

94.06 

188. 12 

376.  24 

19.17 

47.92 

95.84 

191.68 

383. 36 

19.  52 

48.81 

97.62 

195.  24 

390.  48 

19.89 

49.73 

99.46 

198. 92 

397.  84 

20.26 

50.  60 

101.32 

202.  64 

405.  28 

$698. 80 

712.  00 

725.  20 

738. 80 

752. 80 

766. 80 

781.  20 

795.  80 

810. 80 

826. 00 

841.40 

857.  20 

873.  40 

889.  60 

906.  40 

923.  40 

940. 60 

958.  40 

976.  20 

994.  60 

1,013.20 

$1,  397.  60 
1,  424.  00 
1,450.40 
1.477.60 
1,505.60 
1,533.60 
1,562.40 
1,591.60 
1.621.60 
1,  652. 00 
1,  682. 80 
1,  714.  40 
1,746.80 
1,  779.  20 
1,812.80 
1. 846. 80 
1,881.20 
1,916.80 
1,  952. 40 
1, 989.  20 


2. 026.  40 


3.14 


3.14 
3.15 
3.17 
3.18 
3.19 
3.20 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.30 
3.30 
3.31 
3.32 
3.33 
3.33 


3.34 


3.55 
3.59 
3.64 
3.69 
3.71 
3.74 
3.77 
3.81 
3.84 
3.91 
3.98 
4.01 
4.04 
4.15 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3,75 
3.75 
3.  75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.75 
3.74 


1  For  redemption  values  and  investiuont  vi(dtls  during  original  niaturitv  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  Sciitoinhcr  23,  1959,        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  inalurity  value  prior  to  June  1,  1959,  revision. 

4  Appro.ximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

5  20  years  from  issue  date.       6  30  years  from  issue  date. 


EXHIBITS 


289 


Table  XV.— United  States  Savings  Bonds— Series  E 

TABLE  OF  REDEMPTION  VALUES  AND  INVESTMENT  YIELDS  DURING  EXTENDED  MATURITY  PERIODS  '  FOR   BONDS 
BEARING  ISSUE  DATES  FROM  JUNE    1  THROUGH   NOVEMBER   1,  1947 

Table  showing:  (1)  Houj  bonds  of  Series  E  bearing  issue  dates  June  1  through  November  1, 191,7,  by  denominations, 
increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity;  (S)  the 
approximute  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year  period;  and 
(3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each  half-year  period 
(a)  to  first  extended  maturity  or  (b)  to  second  extended  maturity.  Yields  are  expressed  in  terms  of  rate  percent 
per  annum,  compounded  semiannually. 


Original  maturity 

value 

Issue  price 


$10.  00 
7.50 

$25.  00 
18.75 

$50. 00 
37.50 

$100.  00 
75.00 

$200.00 
150.00  1 

$500. 00 
375.  00 


$1, 000. 00 
750.  00 


Approximate  invest- 
ment yield  2 


Period  after  orig- 
inal maturity 
(beginning  10 
years  after  issue 
date) 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


First  extended  maturity  period 


(2)  On 
purchase 
price 
from 
issue 
date  to 
begin- 
ning of 

each 

half-year 

period 


(3)  On 

current 
redemption 
value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


First  Hyear-. 
H  to  1  year--- 

1  to  1^  years - 
V4  to  2  years - 

2  to  214  years- 


$10.00 

$25. 00 

$50. 00 

$100. 00 

$200. 00 

10.15 

25.37 

50.75 

101.50 

203. 00 

10.30 

25.75 

51.50 

103. 00 

206. 00 

10.45 

26. 12 

52.25 

104.  50 

209. 00 

10.60 

26.50 

.53.  00 

106. 00 

212.00 

$500.  00 

507.  50 

515.00 

522. 50 

530.  00 

$1, 000. 00 
1,015.00 
1, 030. 00 
1, 045. 00 
1,060.00 


Percent 
2.90 
2.90 
2.90 
2.91 
2.90 


Percent 
33.00 
33.00 
33.00 
33. 0) 
<  3.  ,52 


Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


2V^  to  3  years 

3  to  3^2  years 

3^  to  4  years 

4  to  4}-^  years 

4'^  to  5  years 

5  to  5J.4  years 

5}^  to  6  years 

6  to  6H  years 

6^  to  7  years 

7  to  7H  years 

714  to  8  years 

8  to8J^  years 

Sl-i  to  9  years 

9  to  95^2  years 

9J'2  to  10  years 

First  extended 

maturity  value 
(10  years  from 
original  matu- 
rity date)  5 


Period  after  first 
extended  maturity 
(beginning  20  years 
after  issue  date) 


First  }/2  year 

H  to  1  year 

1  to  lli  years 

1'^  to  2  years 

2  to  2}-4  years 

21-2  to  3  years 

3  to  3}4  years 

VA  to  4  years 

4  to  iA  years 

i\4  to  5  years 

5  to  514  years 

5J-'2  to  6  years 

6  to  63-^  years 

6,4  to  7  years 

7  to  714  years 

7li  to  8  years 

8  to8J-2  years 

SH  to  9  years 

9  to  9}.^  years 

QA  to  10  years 

Second  extended 

maturity  value 
(20  years  from 
original  matu- 
rity dafp)' 


$10.  76 
10.93 
11.10 
11.27 
11.44 
11.64 
11.85 
12.06 
12.27 
12.49 
12.72 
12.94 
13.20 
13.46 
13.73 


14.01 


$26. 91 

$53. 82 

$107.  64 

.$215.  28 

27.32 

54.64 

109.  28 

218.  56 

27.74 

55.48 

110.96 

221.  92 

28.17 

56.34 

112. 68 

225. 36 

28.61 

57.22 

114. 44 

228. 88 

29.11 

58.22 

116.44 

232. 88 

29.63 

59.26 

118.  52 

237. 04 

30.15 

60.30 

120.  60 

241.  20 

30.68 

61.36 

122. 72 

245.  44 

31.23 

62.46 

124.  92 

249. 84 

31.79 

63.58 

127. 16 

254.  32 

32.36 

64.72 

129. 44 

258. 88 

33.00 

66.00 

132.00 

264. 00 

33.65 

67.30 

134.  60 

269. 20 

34.32 

68.64 

137. 28 

274.  56 

35.02 

70.04 

140. 08 

280. 16 

$538. 20 
546. 40 
554.  80 
563.  40 
572.  20 
582. 20 
592. 60 
603. 00 
613. 60 
624. 60 
635.  80 
647.  20 
660.  00 
673. 00 
686. 40 


$1,076.40 
1, 092. 80 
1, 109. 60 
1, 126. 80 
1, 144.  40 
1, 164. 40 
1, 185.  20 
1, 206. 00 
1, 227. 20 
1, 249. 20 
1,271.60 
1, 294. 40 
1, 320. 00 
1, 346. 00 
1, 372. 80 


Second  extended  maturity  period 


$14.01 

$35. 02 

$70. 04 

$140. 08 

$280. 16 

14.27 

35.68 

71.36 

142.  72 

285.  44 

14.54 

36.35 

72.70 

145. 40 

290. 80 

14.81 

37.03 

74.06 

148. 12 

296.  24 

15.09 

37.72 

75.44 

150. 88 

301.  76 

15.37 

38.43 

76.86 

153.  72 

307. 44 

15.66 

39.15 

78.30 

156.  60 

313.  20 

15.95 

39.88 

79.76 

159.  52 

319. 04 

16.25 

40.63 

81.26 

162.  52 

325. 04 

16.56 

41.39 

82.78 

16.5.  56 

331.12 

16.87 

42.17 

84.34 

168. 68 

337. 36 

17.18 

42.  96 

85.92 

171.84 

343.  68 

17.51 

43.77 

87.54 

175.  08 

350. 16 

17.84 

44.59 

89.18 

178.  36 

356.  72 

18.17 

45.42 

90.84 

181.  68 

363.  36 

18.51 

46.27 

92.54 

185. 08 

370. 16 

18.86 

47.14 

94.28 

188.  .56 

377. 12 

19.21 

48.02 

96.04 

192. 08 

.384. 16 

19.57 

48.93 

97.86 

195.  72 

391.  44 

19.49 

49.94 

99.68 

199. 36 

398.  72 

20.31 

50.  78 

101.56 

203. 12 

406.  24 

$700. 40 
713.  60 
727. 00 
740.  60 
754.  40 
768.  60 
783. 00 
797. 60 
812. 60 
827. 80 
843.  40 
859.  20 
875.  40 
891. 80 
908.  40 
925.  40 
942. 80 
960.  40 
978.  60 
996. 80 


$1, 400. 80 
1,427.20 
1,  454. 00 
1,481.20 
1,508.80 
1,  537.  20 
1,  566. 00 
1,  595.  20 
1, 625.  20 
1, 655.  60 
1,  686. 80 
1,718.40 
1,  750. 80 
1,  783.  60 
1,816.80 
1, 850.  80 
1,  885.  60 
1,920.80 
1,957.20 
1, 993.  60 


2.91 
2.92 
2.92 
2.93 
2.94 
2.95 
2.97 
2.99 
3.01 
3.02 
3.04 
3.05 
3.08 
3.10 
3.12 


3.15 


3.15 
3.16 
3.18 
3.19 
3.20 
3.22 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.30 
3.30 
3.31 
3.32 
3.33 
3.34 
3.34 


3.35 


3,54 
3.  .58 
3.62 
.3.66 
3.71 
3.73 
3.75 
3.78 
3.82 
3.85 
3.91 
3.99 
4.00 
4.03 
4.08 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.  75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.76 
3.75 
3.76 
3.75 
3.77 


1  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23, 1959. 

2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity , 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1,  1959,  revision  to  first  extended  maturity. 
'  20  years  from  issue  date.       « 30  years  from  issue  date. 


290    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  XVI.— United  States  Savings  Bonds— Series  E 

TABLE  OF  REDEMPTION  VALUES  AND  INVESTMENT  YIELDS    DURING    EXTENDED    MATURITY    PERIODS  1    FOR 
BONDS   BEARING  ISSUE   DATES   FROM   DECEMBER   1,    1947,  THROUGH   MAY   1,   1948 

Table  showing:  (/)  How  bonds  of  Series  E  bearing  issue  dates  December  1, 19J,7,  through  May  1,  191,8.  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  foUov'ing  date  of  original  maturity; 
(i)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannually. 


Original  maturity 

value 

Issue  price 


Period  after  orig- 
inal maturity 
(beeinnins  10 
years  after  issue 
date) 


$10. 00 
7.50 


$25.  00 
18.75 


$50.  00 
37.50 


$100.  00 
75.00 


$200.  00 
150.  00 


$500.00    $1,000.00 
375.00         750.00 


(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 


First  extended  maturity  period 


Approximate  invest- 
ment yield  2 


(2)  On 
purchase 
price 
from 
issue 
date  to 
begin- 
ning of 

each 

half-year 

period 


(3)  On 

current 
redemption 
value  ifrom 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 


First  H  year.. 
H  to  1  year. . . 
1  to  1}^2  years. 
VAio2  years. 


$10.  00 

$25.  00 

$50.  00 

$100.00 

.$200,  00 

10. 15 

25. 37 

50.75 

101.50 

203.  00 

10.30 

25.  75 

51.50 

103.00 

206.  00 

10.45 

26.12 

52.25 

104.  50 

209.  00 

$500.00 

507 

50 

515 

00 

522 

50 

$1,000.00 
1,015.00 
1,030.00 
1,045.00 


Percent 
2.90 
2.90 
2.90 
2.91 


Percent 
33.00 
33.00 
33.00 
<3.51 


Redemption  values  and  investment  yields  to  first  extendel  maturity  on  basis  of  June  1,  1959,  revision 


2  to  214  years 

2H  to  3  years 

3  to  3^  years 

3J4  to  4  years 

4  to  4^2  years 

43^  to  5  years 

5  to  5H  years 

5^2  to  6  years 

6  to  6!/2  years 

61^  to  7  years 

7  to  V/2  years 

V/2  to  8  years 

8  to  81.4  years 

8'.^  to  9  years 

9  to  914  years 

9.'^  to  10  years 

First      extended 

maturity  value 
(10  years  from 
original  matu- 
rity date)  ' 


Period  after  first 
extended  matu- 
rity (beiinni/ig 
20  years  aftesr 
issue  date) 


First  ^4  year 

?2  to  1  year 

1  to  IJ2  years 

IM  to  2  years 

2  to  23  2  years 

2,' '2  to  3  years 

3  to  31. 2  years 

3J'2  to  4  yeais 

4  to  4>2  years 

43-^  to  5  years 

5  to  5\<2  years 

5'/^  to  6  years 

6  to  61^  years 

^M  to  7  years 

7  to  73  2  years 

73^  to  8  j'ears 

8  to  8K  years 

83-^  to  9  years 

9  to  93^  years 

914  to  10  years 

Secondextended 

maturity  value 
(20  years  from 
original  matu- 
rity date)  « 


$10.  60 
10.77 
10.94 
11.11 
11.28 
11.46 
11.66 
11.87 
12.08 
12.30 
12.52 
12.74 
12.98 
13.23 
13.49 
13.76 


$26.  51 

$53.  02 

$100  04 

$212. 08 

26.92 

53.84 

107.  68 

215.  36 

27.34 

54.68 

109.36 

218.  72 

27.77 

55.  54 

111.08 

222  16 

28.20 

56.40 

112.80 

225.  60 

28.65 

57.30 

114.60 

229. 20 

29.16 

68.32 

116.64 

233. 28 

29.68 

59. 36 

118.  72 

237.  44 

30.21 

60.42 

120.84 

241.68 

30.75 

61.50 

123.00 

246.  00 

31.30 

62.60 

125.  20 

250.  40 

31.86 

63.72 

127.  44 

254.  88 

32.44 

64.88 

129.  76 

259.  52 

33.08 

66.16 

132.32 

261.  64 

33.  73 

67.46 

134.  92 

269. 84 

34.40 

6S.80 

137.  60 

275. 20 

35.11 

70.22 

140.44 

280. 88 

$530.  20 
538.  40 
546.  80 
555.  40 
,564.  00 
573.  00 
583. 20 
593.  60 
604.  20 
615. 00 
626.  00 
637. 20 
648.  80 
661.  60 
674. 60 
688.  00 


$1,060.40 
1,076.80 
1,  093.  60 
1,110.80 
1, 128. 00 
1,146.00 
1, 166.  40 
1,187.20 
1,208.40 
1,230.00 
1,2.52.00 
1,274.40 
1,297.00 
1,323.20 
1,319.20 
1,376.00 


1,404.40 


Second  extended  maturity  period 


$14.04 

.$35.11 

$70.  22 

$140.  44 

$280.  88 

14.31 

35.  77 

71.54 

143.  OS 

286. 16 

14.58 

36.44 

72.88 

145.  76 

291.  52 

14.85 

37.12 

74.24 

148.48 

296.  96 

15.13 

37.82 

75.64 

151.28 

302.  56 

1,5. 41 

38.53 

77.06 

154.12 

308. 24 

15.70 

39.  25 

78.50 

157.00 

314.00 

16.00 

39.99 

79.98 

159.96 

319,92 

16.30 

40.74 

81.48 

162.96 

325.  92 

16.60 

41.. 50 

83.00 

166.00 

332.  00 

16.91 

42. 28 

84.  .56 

169.12 

338. 24 

17.23 

43.07 

86.14 

172.28 

344.  56 

17.55 

43.88 

87.  76 

175.52 

351.04 

17.88 

44.70 

89.40 

178.80 

357. 60 

18.22 

45.54 

91.08 

182.16 

361.32 

18.56 

46.39 

92.78 

185.  56 

371.12 

18.90 

47.26 

94.52 

189.01 

378.  03 

19.26 

48.15 

96.30 

192.60 

385.  20 

19.62 

49.05 

98.10 

196. 20 

392.  40 

19.99 

49.97 

99.94 

199.88 

399.  76 

20.36 

50.91 

101.82 

203.  64 

407. 28 

$702,  20 
715.  40 
728.  SO 
742,  40 
756.  40 
770.  60 
785.  00 
799.  80 
814,80 
830,  00 
845.  60 
861.  40 
877.  60 
894.  00 
910.  80 
927.  SO 
945. 20 
963.  00 
981.00 
999. 40 


.$1,404.40 
1,430.80 
1,457.60 
1,484.80 
1,512.80 
1,541.20 
1,570.00 
1,  .599.  60 
1,629.60 
1,660.00 
1,691.20 
1, 722.  80 
1,  755. 20 
1,  788. 00 
1,821.60 
1.85.5.60 
1,890.40 
1, 926.  00 
1,962.00 
1, 998. 80 


2,  036.  40 


2.91 
2.91 
2.92 
2.93 
2.94 
2.95 
2.97 
2.99 
3.00 
3.02 
3. 04 
3.05 
3.07 
3.09 
3.11 
3.14 


3.16 
3.18 
3.19 
3.20 
3.21 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.30 
3.31 
3.31 
.3.32 
3.33 
3.34 
3.34 
3.35 


3.36 


3.54 
3.57 
3.61 
3.64 
3.69 
3.73 
3.75 
3.77 
3.79 
3.82 
3.87 
3.92 
3.99 
4.01 
4.  05 
4.13 


(h)  to 

se(ond 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3,75 
3,75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.76 
3.76 


I  For  redemption  values  and  investment  yields  during  original  maturitv  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity,  at  first 
extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity, 

'  20  years  from  issue  date.       ^  30  years  from  issue  date. 


EXHIBITS 


291 


Table  XVII. — United  States  Savings  Bonds — Series  E 

TABLE     OF     REDEMPTION      VALUES     AND     INVESTMENT     YIELDS      DURING      EXTENDED     MATURITY 
PERIODS  1    FOR    BONDS    BEARING    ISSUE    DATES    FROM    JUNE    1    THROUGH    NOVEMBER    1,    1948 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dates  June  1, 19i8,  through  November  1,  19i8,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  fijllowing  date  of  original  maturity; 
(2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  Ijeginning  of  each  half-year 
period:  and  (5)  the  approximate  investment  yield  on  the  curient  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  jer  annum,  comj)ounded  semiannually . 


Orisinal  maturity 
value 

$10.  00 
7.50 

$25.  00 
18.75 

$50.  00 
37.50 

$100. 00 
75.00 

$200.  00 
150.  00 

$500.  00 
375.  00 

$1, 000. 00 
750.  00 

Approximate  invest- 
ment yield  2 

Issue  price 

(2)  On 
purchase 
price 
from 
i.ssue 
date  to 
be.c  in- 
ning of 

each 

half-year 

period 

(3)  On 

current 

redemption 

value  from 

Period  after  orig- 

(1) Redemption  values  during  each  half-year  period 
(V^alues  increase  on  first  day  of  period  shown) 

inal  maturity 
(beginning  10 
years  after  issue 
date) 

First  e.xtended  maturity  period 

ber  inning 

of  each 

half-year 

period  (a) 

to  first 
extended 
maturity 

First  }4  year 

}4tol  year 

1  to  V.i  years 

$10. 00 
10.15 
10. 30 

$25. 00 
25. 37 
25.  75 

$50. 00 
50.75 
51.50 

$100. 00 
101.50 
103.00 

$200.  00 
203.  00 
206.  00 

$500. 00 
507. 50 
515,00 

$1,000.00 
1,015  00 
1,030,00 

Percent 
2.90 
2.90 
2.90 

Percent 
33.00 
33.00 
<3.50 

Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  .Tune  1,  1959,  revision 


V/i  to  2  years 

2  to  2J^  years 

2>^  to  3  years 

3  to  314  years 

3J^  to  4  years 

4  to  4}/2  years 

4}4  to  5  years 

5  to  5^2  years 

5H  to  6  years 

6  to  6^/2  years 

63^  to  7  years 

7  to  714  years 

7H  to  8  years 

8  to  8}^  years 

8H  to  9  years 

9  to  9\4  years 

9}4  to  10  years 

First  extended 

maturity  value 
(10  years  from 
original  raatu- 
ritv  date)5 


Period  after  first 
extended  matu- 
rity (beginning 
20  years  after 
issue  date) 


First  3-2  year 

J-^  to  1  year 

1  to  VA  years 

13^  to  2  years 

2  to2V2  years 

23^  to  3  years 

3  to  33^  years 

ZH  to  4  years 

4  to  43^  years 

43^  to  5  years 

5  to  53^  years 

53^  to  6  years 

6  to  61/^  years 

63^  to  7  years 

7  to  73/^  years 

73^  to  8  years 

8  to  8' 2  years 

83^  to  9  years 

9  to  93^  years 

93^  to  10  years 

Second  extended 

maturity  value 
(20  vears  from 
original  matu- 
rity  date)  6 


$10.46 
10.61 
10.77 
10.94 
11.12 
11.30 
11.48 
11.68 
11.89 
12.10 
12.32 
12.55 
12,77 
13,00 
13.26 
13.52 
13.79 


14.08 


$26. 14 

$52. 28 

$104. 56 

$209. 12 

26.52 

53.04 

106. 08 

212.16 

26.93 

53.86 

107.  72 

215.44 

27.36 

54.72 

109. 44 

218.  88 

27.80 

55.60 

111.20 

222. 40 

28.24 

56.48 

112.96 

225. 92 

28.09 

57.38 

114.76 

229.  52 

29.21 

58.42 

116.84 

233. 68 

29.73 

59.46 

118.92 

237.  84 

30.26 

60.52 

121.04 

242,08 

30.81 

61,62 

123.  24 

246  48 

31.37 

62.74 

125.48 

250. 96 

31.93 

63.86 

127,  72 

255.  44 

32.51 

65,02 

130  04 

260. 08 

33.15 

66.30 

132.60 

265. 20 

33.81 

67.62 

135.24 

270.  48 

34.48 

68.96 

137. 92 

275. 84 

35.20 

70.39 

140.  78 

281.56 

$522.  80 

530. 40 

538,  60 

547.  20 

556. 00 

564.  80 

573,  80 

584, 20 

594. 60 

605.  20 

616.20 

627.  40 

638.  60 

650.  20 

663. 00 

676.  20 

689. 60 

703.90 

$1,045.60 
1,060.80 
1,077,20 
1,  094,  40 
1,112,00 
1,129,60 
1, 147.  60 
1, 168.  40 
1, 189. 20 
1,210.40 
1, 232.  40 
1,254,80 
1,277  20 
1,300,40 
1, 326, 00 
1,  352,  40 
1,379.20 


Second  extended  maturity  period 


$14.08 

$35.  20 

$70. 39 

$140, 78 

$281.56 

14.34 

35.85 

71.70 

143. 40 

286.  80 

14.61 

36.53 

73.06 

146. 12 

292.  24 

14.88 

37.21 

74.42 

148. 84 

297.  68 

15.16 

37,91 

75.82 

151.64 

303.  28 

15.45 

38.62 

77.24 

154.48 

308. 96 

15.74 

39.34 

78.68 

157.  36 

314.  72 

16.03 

40  OS 

80.16 

160.  32 

320,  64 

16.33 

40.83 

81.66 

163.  32 

326,  64 

16.64 

41.60 

83.20 

166.  40 

332.  80 

16. 95 

42.38 

84.  76 

169.  52 

339. 04 

17.27 

43.17 

86.34 

172.  68 

345.36 

17.  59 

43.98 

87.96 

175.  92 

351.84 

17.92 

44.81 

89.62 

179. 24 

358.  48 

18.26 

45. 65 

91.30 

182.60 

365. 20 

18.  60 

46.50 

93.00 

186,  00 

372  00 

18.95 

47.38 

94.76 

189,  52 

379, 04 

19.30 

48,26 

96.52 

193,  04 

386, 08 

19.67 

49,17 

98,34 

196.  68 

393.  36 

20.04 

50.09 

100. 18 

200. 36 

400. 72 

20.41 

51.03 

102.  Ofi 

204. 12 

408. 24 

$703.  90 
717.00 
730. 60 
744. 20 
758.  20 
772,  40 
786,  80 
801.60 
816.  60 
832,  00 
847. 60 
863. 40 
879.  60 
896. 20 
913.00 
930. 00 
947.  60 
965.  20 
983.  40 
1,001.80 


24      1. 020.  60     2. 041.  20 


$1,407  80 
1, 434, 00 
1,461.20 
1,488,40 
1,516,40 
1, 544,  80 
1,573,60 
1, 603,  20 
1, 633. 20 
1,664,00 
1,695.20 
1,726.80 
1,  759. 20 
1,  792,  40 
1,826,00 
1,860.00 
1.895.20 
1, 930  40 
1,966.80 
2, 003. 60 


2.91 
2.91 
2.92 
2.93 
2.94 
2.95 
2.96 
2.98 
3.00 
3  01 
3.03 
3,05 
3  07 
3.08 
3.10 
3.13 
3.15 


3.17 


3.17 
3.19 
3.20 
3.21 
3.23 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.30 
3.31 
3.31 
3.32 
3.33 
3.34 
3.34 
3.35 
3.36 


3.37 


3.53 
3.57 
3.60 
3.63 
3.66 
3.70 
3.75 
3.76 
3.79 
3.81 
3.84 
3.87 
3.93 
4.01 
4.03 
4.06 
4.15 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.76 
3.75 
3.75 


'  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity 

s  20  years  from  issue  date.       « 30  years  from  issue  date. 


I 


292   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  XVIII.— United  States  SAViNns  Bonds— Series  E 

TABLE  OF  REDEMPTION  VALUES  AND  INVESTMENT  YIELDS  DURINO  EXTENDED  MATURITY  PERIODS  '  FOR  BONDS 
BEARINO  ISSUE  DATES  FROM  DECEMBER  I,  1948,  THROUGH  MAY  1,  1949 

Table  showing:  (1)  How  bonds  of  Series  E  bearing  issue  dates  December  1, 19i8,  through  May  1,  19i9,  by  denomi- 
nations, increase  in  redemption  value  during  successive  half-year  periods  following  date  of  original  maturity: 
(2)  the  approximate  investment  yield  on  the  purchase  price  from  issue  date  to  the  beginning  of  each  half-year 
period:  and  (3)  the  approximate  investment  yield  on  the  current  redemption  value  from  the  beginning  of  each 
half-year  period  (a)  to  first  extended  maturity  or  (6)  to  second  extended  maturity.  Yields  are  expressed  in  terms 
of  rate  percent  per  annum,  compounded  semiannually. 


Original  maturity 

$10.  00 
7.50 

$25.  00 
18.75 

$50. 00 
37.50 

$100. 00 

$200.  00 

$500.  00 
375.  00 

$1,000.00 
750.  00 

Approximate  invest- 
ment yield  2 

Issue  price 

75.00  1   150.00 

(2)  On 
purchase 
price 
from 
issue 
date  to 
begin- 
ning of 

each 

half-year 

period 

(1)  Redemption  values  during  each  half-year  period 
(Values  increase  on  first  day  of  period  shown) 

(3)  On 

current 

redemption 

Period  after  orig- 
inal maturity 
(beginning  10 
years  after  issue 
date) 

First  extended  maturity  period 

value  from 
beginning 

of  each 
half-year 
period  (a) 

to  first 
extended 
maturity 

First  l^  year 

litol  year 

$10. 00 
10.15 

$25.00 
25.37 

$50.00    $100.00 
50.75     101.50 

$200.00 
203. 00 

$500. 00 
507.  50 

$1, 000. 00 
1,015.00 

Perce7it 
2.90 
2.90 

Percent 
33.00 
<3.50 

Redemption  values  and  investment  yields  to  first  extended  maturity  on  basis  of  June  1,  1959,  revision 


1  to  IV^  years 

1'/^  to2  years 

2  to  2'4  years 

214  to  3  years 

3  to  3'/^  years 

31^  to  4  years 

4  to  41-^  years 

4'/^  to  5  years 

5  to  5V^  years 

5\4  to  6  years 

6  to  6'/^  years 

6'/^  to  7  years 

7  to  7\4  years 

7V^  to  8  years 

8  to  8^^  years 

8V^  to9  years 

9  to  91/^  years 

9V^  to  10  years 

First  extended 

maturity  value 
(10  years  from 
original  matu- 
rity  date)' 


Period  after  first 
extended  matu- 
rity (beginning 
10  years  after 
issue  date) 


First  l^year 

l^tol  year 

1  to  IH  years 

IV^  to  2  years 

2  to  21^  years 

21^  to  3  years 

3  to  3i^  years 

3^  to  4  years 

4  to  4!^  years 

4'/^  to  5  years 

5  to  5!/2  years 

5V^  to  6  years 

6  to  6V^  years 

6V^  to  7  years 

7  to  7!^  years 

7?^  to  8  years 

8  to  8'/^  years 

8V^  to  9  years 

9  to  9?^  years 

9V^to  10  years 

Second  extended 

maturity  value 
(20  years  from 
original  matu- 
rity date)' 


$10.30 

$25. 76 

$51.52 

$103. 04 

$206. 08 

10.46 

26.14 

52.28 

104.  56 

209. 12 

10.61 

26.53 

53.06 

106. 12 

212.24 

10.78 

26.96 

53.92 

107. 84 

215.68 

10.96 

27.39 

54.78 

109.  56 

219.12 

11.13 

27.83 

55.66 

111.32 

222. 64 

11.31 

28.28 

56.56 

113.12 

226. 24 

11.50 

28.74 

57.48 

114.96 

229. 92 

11.70 

29.26 

58.52 

117.04 

234.08 

11.92 

29.79 

59.58 

119.16 

238. 32 

12.13 

30.33 

60.66 

121.32 

242.  64 

12.35 

30.87 

61.74 

123. 48 

246.  96 

12.57 

31.43 

62.86 

125.  72 

251.44 

12.80 

32.00 

64.00 

128. 00 

256.00 

13.04 

32.59 

65.18 

130.36 

260.  72 

13.29 

33.23 

66.46 

132. 92 

265. 84 

13.56 

33.89 

67.78 

135.  56 

271.12 

13.82 

34.56 

69.12 

138. 24 

276. 48 

14.11 

35.28 

70.56 

141.12 

282. 24 

$515.20 
522. 80 
530. 60 
539. 20 
547. 80 
556. 60 
565. 60 
574. 80 
585. 20 
595. 80 
606.  60 
617. 40 
628.  60 
640. 00 
651.80 
664. 60 
677. 80 
691. 20 


705. 60 


$1,030.40 
1,045.60 
1,061.20 
1,078.40 
1,095.60 
1,113.20 
1,131.20 
1, 149.  60 
1.170.40 
1,191.60 
1,213.20 
1,234.80 
1, 257. 20 
1,280.00 
1,303.60 
1, 329. 20 
1, 355.  60 
1,382.40 


Second  extended  maturity  period 


$14.11 

$35. 28 

$70. 56 

$141.12 

$282. 24 

14.38 

35.94 

71.88 

143.  76 

287.  52 

14.65 

36.62 

73.24 

146. 48 

292. 96 

14.92 

37.30 

74.60 

149. 20 

298.40 

15.20 

38.00 

76.00 

152.00 

304. 00 

15.48 

38.71 

77.42 

154. 84 

309.  68 

15.78 

39.44 

78.88 

157.  76 

315.52 

16.07 

40.18 

80.36 

160.  72 

321.  44 

16.37 

40.93 

81.86 

163. 72 

327. 44 

16.68 

41.70 

83.40 

166. 80 

333. 60 

16.99 

42.48 

84.96 

169. 92 

339. 84 

17.31 

43.28 

86.56 

173. 12 

346. 24 

17.64 

44.09 

88.18 

176.36 

352.  72 

17.97 

44.92 

89.84 

179. 68 

359. 36 

18.30 

45.76 

91.52 

183.04 

366. 08 

18.65 

46.62 

93.24 

186. 48 

372. 96 

19.00 

47.49 

94.98 

189. 96 

379.92 

19.35 

48.38 

96.76 

193.  52 

387. 04 

19.72 

49.29 

98.58 

197. 16 

394. 32 

20.08 

50.21 

100. 42 

200. 84 

401.68 

20.46 

51. 15 

102.30 

204. 60 

409.20 

$705.  60 
718.80 
732. 40 
746. 00 
760. 00 
774. 20 
788. 80 
803. 60 
818. 60 
834. 00 
849.60 
865. 60 
881. 80 
898.  40 
915. 20 
932.  40 
949. 80 
967. 60 
985. 80 
1, 004. 20 


$1,411.20 
1, 437. 60 
1, 464. 80 
1,492.00 
1,520.00 
1, 548. 40 
1, 577. 60 
1, 607. 20 
1,637.20 
1, 668. 00 
1,699.20 
1,731.20 
1,  763. 60 
1, 796. 80 
1,830.40 
1, 864. 80 
1,899.60 
1,935.20 
1,971.60 
2, 008. 40 


2.91 
2.91 
2.91 
2.93 
2.94 
2.95 
2.96 
2.97 
2.99 
3.01 
3.03 
3.04 
3.06 
3.08 
3.09 
3.12 
3.14 
3.16 


3.19 


3.19 
3.20 
3.21 
3.22 
3.24 
3.25 
3.26 
3.27 
3.28 
3.29 
3.30 
3.31 
3.32 
3.32 
3.33 
3.34 
3.35 
3.35 
3.36 
3.37 


3.53 
3.56 
3.59 
3.62 
3.65 
3.68 
3.72 
3.76 
3.78 
3.79 
3.82 
3.85 
3.89 
3.94 
4.01 
4.03 
4.06 
4.17 


(b)  to 

second 

extended 

maturity 


3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.75 
3.74 
3.75 
3.75 
3.74 
3.74 


»  For  redemption  values  and  investment  yields  during  original  maturity  period  see  Department  Circular 
No.  653,  Fifth  Revision,  dated  September  23,  1959.        2  Calculated  on  basis  of  $1,000  bond  (face  value). 

3  Approximate  investment  yield  from  beginning  of  each  half-year  period  to  first  extended  maturity, 
at  first  extended  maturity  value  prior  to  June  1,  1959,  revision. 

*  Approximate  investment  yield  from  effective  date  of  June  1, 1959,  revision  to  first  extended  maturity. 

'  20  years  from  issue  date.       « 30  years  from  issue  date. 


EXHIBITS  293 

Exhibit  7. — Fourth  amendment.  May  16,  1981,  to  Department  Circular  No.  750, 
Revised,  regulations  governing  payments  by  banks  and  other  financial  insti- 
tutions in  connection  with  the  redemption  of  U.S.  savings  bonds 

Treasury  Department, 
Washington,    May   16,    1961. 

Section  321.9  of  Treasury  Department  Circular  No.  750,  Revised,  dated  June 
30,  1945,  as  amended  and  supplemented  (31  C.F.R.  321),  is  hereby  amended 
to  read  as  follows: 

Sec.  321.9.  Specific  limitations  of  payment  authority. — ^An  agent  is  not  author- 
ized to  pay  a  bond:  (a)  If  the  bond  is  presented  for  payment  prior  to  the  ex- 
piration of  two  months  from  the  issue  date  (the  issue  date  should  not  be  confused 
with  the  date  appearing  in  the  issuing  agent's  dating  stamp).  Any  payment  or 
advance  to  a  bond  owner  before  a  bond  is  eligible  for  redemption  is  not  authorized 
in  any  circumstance. 

(6)  If  the  agent  does  not  know  or  cannot  establish  to  its  complete  satisfaction 
the  identity  of  the  person  requesting  payment  as  the  owner  of  the  bond  (including 
the  establishment  of  the  identity  of  parents  requesting  payment  on  behalf  of 
minor  children,  as  set  forth  in  sec.  321.8(b)). 

(c)  If  the  owner  requesting  payment  (form  for  which  appears  on  the  back  of 
each  bond)  does  not  sign  his  name  in  ink  as  it  is  inscribed  on  the  face  of  the  bond 
and  show  his  home  or  business  address.  (See  also  sees.  321.8  (a)  and  (b),  and 
321.10(d).) 

(rf)  If  the  bond  appears  to  bear  a  material  irregularity,  for  example,  an  altered, 
illegible,  incomplete,  or  unauthorized  inscription,  issue  date,  or  issuing  agent's 
validating  stamp  impression;  or  if  a  bond  appears  to  be  altered,  or  is  mutilated 
or  defaced  in  such  a  manner  as  to  create  doubt  or  arouse  suspicion  with  respect 
to  the  bond  or  any  essential  part  thereof. 

(e)  If  Treasury  Department  regulations  require  the  submission  of  documentary 
evidence  to  support  the  redemption  of  the  bond,  as  in  the  case  of  deceased  owners, 
incompetents  or  minors  under  legal  guardianship,  or  the  change  of  an  owner's 
name  as  inscribed  on  a  bond  if  for  any  reason  other  than  marriage. 

(/)  If  the  owner  named  on  the  bond  and  requesting  payment  is  a  minor  who, 
in  the  opinion  of  the  agent,  is  not  of  sufficient  competency  and  understanding 
to  execute  the  request  for  payment  and  comprehend  the  nature  of  such  act. 
(Note  the  authority  granted  to  agents  to  make  payments  of  bonds  to  either 
parent  on  behalf  of  a  minor  child  under  the  provisions  of  sec.  321.8(b).) 

(gr)  If  it  is  known  to  the  agent  that  the  owner  has  been  declared,  in  accordance 
with  law,  incompetent  to  manage  his  estate. 

(h)   If  partial  redemption  is  requested. 

Attention  is  directed  to  sec.  321.17  hereof  for  handling  bonds  of  the  foregoing 
classes  of  cases  which  may  not  be  paid  by  agents. 

Robert  V.  Roosa, 
Under  Secretary  of  the  Treasury  for  Monetary  Affairs. 


U.S.  Savings  Stamps  Regulations 

Exhibit  8. — First  revision,  August  5,  1980,  of  Department  Circular  No.  1008, 
regulations  governing  Treasury  savings  stamp  agents  in  the  sale  of  U.S.  savings 
stamps  at  schools  ^ 

Treasury  Department, 
Washington,  August  5,  1960. 

Department  Circular  No.  1008,  dated  April  25,  1958  (31  CFR  338),  is  hereby 
revised  to  read  as  follows: 

Sec.  338.1  Authority  for  circular. — The  Secretary  of  the  Treasury,  pursuant 
to  the  authority  of  the  Second  Liberty  Bond  Act,  as  amended  (49  Stat.  21,  as 
amended,  31  U.S.C.  757c),  hereby  prescribes  the  regulations  in  this  part  for  the 
qualification  and  control  of  Treasury  savings  stamp  agents. 

Sec.  338.2  Eligibility  for  applying  for  agency. — Any  individual  is  eligible  to 
apply  for  qualification  as  a  Treasury  savings  stamp  agent  to  sell  United  States 

>  This  Is  to  facilitate  the  carrying  out  of  the  Treasury's  school  savings  program  as  administered  by  the 
Savings  Bonds  Division  of  the  Treasury  Department. 


294   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

savings  stamps  (hereinafter  referred  to  as  stamps)  at  a  specific  school  or  schools 
in  the  United  States,  its  Territories  and  possessions,  and  the  Canal  Zone,  upon 
being  recommended  for  qualification  by  (i)  the  principal  or  superintendent,  or 
other  person  in  charge  of  a  school,  (ii)  a  duly  constituted  school  board,  or  (iii) 
with  the  consent  of  the  appropriate  school  official  or  board  to  the  sale  of  stamps 
at  the  subject  school,  an  organization,  association,  or  a  unit  of  a  State  or  nationally 
federated  civic,  parents',  parent-teachers',  service,  teachers',  veterans',  or  women's 
organization. 

Sec.  338.3  Q^iah'fication  of  agents. — An  eligible  applicant  seeking  to  qualify 
as  a  Treasury  savings  stamp  agent  shall  file  a  duly  completed  Application- Agree- 
ment, Treasury  Form  PD  2949  (original  and  two  copies),  with  the  local  State 
Director  of  the  Treasury's  U.S.  Savings  Bonds  Division.  The  term  "State 
Director"  shall  include  any  director  appointed  by  the  U.S.  Savings  Bonds  Division 
for  the  District  of  Columbia,  or  for  any  Territory  or  possession  of  the  United 
States,  or  the  Canal  Zone.  If  such  Application-Agreement  is  accepted,  the 
State  Director  will  certify  it  and  distribute  a  copy  bearing  his  certification  to 
(i)  the  postmaster  of  the  post  office,  branch  or  station  designated  in  the  applica- 
tion, and  (ii)  the  Treasury  savings  stamp  agent,  hereinafter  referred  to  as  the 
agent.  Upon  receipt  of  such  copies,  the  postmaster  and  the  agent  are  authorized 
to  perform  the  functions  necessary  to  effect  the  sale  of  stamps  as  provided  herein. 
An  applicant  is  not  authorized  to  act  as  or  to  represent  himself  to  be  a  Treasury 
savings  stamp  agent  unless  and  until  he  receives  a  completed  copy  of  his  Applica- 
tion-Agreement bearing  the  certification  of  the  State  Director. 

Sec.  338.4  Responsibility  of  agents. — Each  agent  will  be  responsible  for  the 
faithful  performance  of  his  duties  and  functions  and  for  fully  accounting  for  all 
stamps  received  without  prepayment.  All  stamps  obtained  pursuant  to  the 
provisions  of  this  circular,  including  proceeds  of  sales  thereof,  are  the  property 
of  the  United  States  and  shall  be  held  in  trust  for  it  by  the  agent  until  duly 
accounted  for  pursuant  to  the  provisions  of  this  circular. 

Sec.  338.5  Scope  of  authority  of  Treasury  savings  stamp  agent. — An  agent  is 
authorized  to  sell  stamps  only  at  the  school  or  schools  designated  in  the  agent's 
Application-Agreement,  and  in  accordance  with  the  provisions  of  this  circular. 
Agents  may  sell  stamps  only  for  cash  and  at  their  face  value.  Qualification  as  a 
Treasury  savings  stamp  agent  does  not  authorize  an  individual  to  act  in  any 
other  agency  capacity  for  or  on  behalf  of  the  Treasury  Department. 

Sec.  338.6  Stamps  may  be  obtained  without  prepayment. — Each  agent  may, 
subject  to  the  provisions  of  this  circular,  obtain  without  prepayment  an  amount 
of  stamps  sufficient  to  meet  his  maximum  sales  requirements  for  any  one  stamp 
day.  (The  term  "stamp  day"  means  the  day  of  the  week  designated  by  the 
appropriate  school  official  as  the  day  when  U.S.  savings  stamps  may  be  purchased 
by  students  served  by  the  agent.)  Such  stamps  shall  be  obtained  by  the  agent 
from  the  post  office,  branch  or  station  designated  in  the  agent's  Application- 
Agreement  (hereinafter  referred  to  as  the  post  office)  under  one  of  the  bases  set 
forth  in  sec.  338.7. 

Sec.  338.7  Bases  for  agents  obtaining  stamps. —  (a)  General. — If  an  agent's 
stamp  requirements  for  a  stamp  day  have  been  established  by  previous  sales 
experience,  the  agent  may  elect  to  obtain  and  account  for  his  stamp  supplies  on 
one  of  two  bases  designated:  (1)  a  consignment  basis,  and  (2)  a  fixed  credit  basis; 
provided,  however,  that  the  Treasury  may  place  a  hmit  on  the  amount  of  the 
fixed  credit  of  any  agent(s)  and  it  may  at  any  time,  or  from  time  to  time,  require 
any  fixed  credit  agent (s)  to  render  a  full  accounting  or  to  change  from  a  fixed 
credit  to  a  consignment  basis.  If  an  agent's  stamp  requirements  for  a  stamp 
day  have  not  been  satisfactorily  established  by  previous  sales  experience,  the 
agent  shall  be  required  to  obtain  and  account  for  his  stamp  supplies  on  a  consign- 
ment basis  until  such  sales  experience  is  duly  established  at  which  time  he  may, 
as  provided  above,  elect  to  change  to  a  fixed  credit  basis. 

(6)  Obtaining  stamps  on  the  consignment  basis. — Under  the  consignment  basis 
an  agent  shall  (1)  obtain  a  supply  of  stamps  on  each  stamp  day,  or  on  the  business 
day  preceding  such  day,  and  (2)  duly  account  in  full  (as  provided  in  sec  338.8) 
for  all  such  stamps  not  later  than  the  second  business  day  following  the  day  the 
stamps  were  to  be  sold. 

(c)  Fixed  credit  basis. — An  agent  operating  on  the  fixed  credit  basis  shall 
(1)  obtain  a  supply  of  stamps  for  any  one  stamp  day  and  use  the  proceeds  of  sales 
thereof  to  replenish  such  supply  for  subsequent  stamp  day  sales,  and  (2)  duly 
account  in  full  for  the  amount  of  the  stamps  covered  by  the  fixed  credit,  not  later 
than  the  second  business  day  following  the  last  stamp  day  in  each  school  semester; 


EXHIBITS  295 

provided,  however,  that  the  Treasury  may  at  any  time,  or  from  time  to  time, 
limit  or  adjust  the  fixed  credit  of  any  agent,  may  require  a  full  or  partial  account- 
ing by  a  "fixed  credit  agent"  and  may  require  any  "fixed  credit  agent"  to  change 
to  a  consignment  basis  for  obtaining  and  accounting  for  stamps.  A  "fixed  credit 
agent"  may  request  a  reduction  or  an  increase  (supported  by  evidence  of  need) 
of  the  stamps  he  may  obtain  on  the  fixed  credit  basis  and  he  may  elect  to  change 
to  a  consignment  basis  for  obtaining  stamps. 

Sec.  338.8  Accounting  for  stamps  obtained  without  prepayment. — (a)  Receipts 
given  by  agents  for  stamps  obtained. — A  receipt  form,  supplied  by  the  post  office, 
shall  be  signed  by  the  agent  to  cover  all  stamps  he  actually  obtains  at  any  one 
time  without  prepayment.  The  agent  shall  be  satisfied  that  the  amount  stated 
on  the  receipt  is  correct  before  signing  it.  These  forms  shall  be  retained  by  the 
post  office  until  a  full  accounting  for  the  stamps  is  made  by  the  agent. 

(b)  Full  accounting  for  stamps. — Stamps  obtained  without  prepayment  must 
be  accounted  for  in  full  at  such  time  or  times  as  are  prescribed  in  sec.  338.7. 
Such  accounting  shall  be  in  the  form  of  unsold  stamps  or  cash,  or  both,  in  the 
aggregate  amount  of  the  full  value  of  stamps  recorded  on  the  related  post  office 
receipt  form  signed  by  the  agent.  When  such  accounting  is  made  the  postal 
employee  receiving  same  will  mark  the  related  receipt  form  "canceled"  and  date 
and  sign  such  notation.  The  form  shall  then  be  immediately  given  to  the  agent. 
Should  such  receipt  form  be  unavailable  at  the  time  of  such  accounting  the  postal 
employee  shall  appropriately  note  the  facts  of  the  accounting  and  unavailability 
of  the  receipt  and  date  and  sign  such  notation  on  Treasury  Form  PD  2950  (see 
sec.  338.9(b)).     The  form  should  be  retained  by  the  agent. 

(c)  Partial  accounting  for  stamps. — This  paragraph  covers  each  situation  where 
an  agent  renders  any  accounting  for  stamps  and  such  accounting  is  for  less  than 
the  full  amount  of  stamps  obtained  without  prepayment.  However,  it  does  not 
include  transactions  whereby  stamps  are  purchased  by  "fixed  credit  agents" 
with  proceeds  of  stamp  sales  for  the  purpose  of  replenishing  supplies  of  stamps 
for  sale  on  other  stamp  days.  An  accounting  shall  be  in  the  form  of  unsold 
stamps  or  cash,  or  both.  If  an  agent  renders  an  accounting  that  is  less  than  the 
total  amount  of  the  stamps  obtained  by  him  without  prepayment,  the  postal 
employee  to  whom  the  accounting  is  made  shall  appropriately  note  and  date  the 
facts  on  the  related  receipt  previously  given  by  the  agent  and  require  the  agent 
to  endorse  the  notation.  The  receipt  will  be  retained  by  the  post  office  until  a 
full  accounting  is  made.  A  similar  notation,  duly  dated,  shall  be  made  and 
signed  by  the  postal  employee  on  Treasury  Form  PD  2950,  which  form  shall  be 
retained  by  the  agent  as  prescribed  in  sec.  338.9.  (When  the  stamps  are  fully 
accounted  for  the  postal  employee  will  date,  cancel,  sign,  and  return  the  receipt 
to  the  agent  as  prescribed  in  the  preceding  paragraph  338.8(b).)  If  the  original 
related  receipt  form  given  by  the  agent  is  unavailable  at  the  time  of  a  partial 
accounting,  the  postal  employee  shall  appropriately  date,  note,  and  sign  the 
facts  of  the  accounting  and  unavailabiUty  of  the  receipt  on  Treasury  Form  PD 
2950,  which  form  shall  be  retained  by  the  agent  (see  sec.  338.9(b)). 

Sec.  338.9  Records  and  reports,  preparation,  maintenance,  and  destruction  by 
agents. —  (a)  Receipts  by  agents  for  stamps  obtained  without  prepayment. — Section 
338.8  covers  the  preparation  and  distribution  of  receipts  for  stamps  obtained  by 
agents  without  prepayment.  A  receipt  duly  canceled  and  returned  to  an  agent 
shall  be  retained  by  him  one  calendar  month  after  the  month  in  which  it  is  returned 
after  which  the  agent  may  retain  or  destroy  the  receipt  as  he  may  elect. 

(6)  Record  of  transportatio7i  of  sta7nps  and  proceeds  thereof  to  post  office. — Each 
agent  shall  keep  a  record,  in  duplicate,  by  calendar  month,  of  unsold  stamps 
and/or  the  proceeds  of  stamp  sales  (including  proceeds  of  sales  used  by  "fixed 
credit  agents"  for  the  purchase  of  additional  stamps)  shipped  or  otherwise  de- 
livered during  the  month  to  the  post  office.  A  Treasury  Form  PD  2950  is  pro- 
vided for  this  purpose.  Entries  shall  be  made  by  the  agent  on  Form  PD  2950 
at  the  time  each  shipment  or  delivery  is  made.  The  agent  shall  take  the  dupli- 
cate copy  of  Form  PD  2950  with  him  each  time  he  makes  a  full  or  partial  account- 
ing to  the  post  office  for  stamps  that  he  obtained  without  prepayment  (this  does 
not  include  purchase  of  additional  stamps  with  the  proceeds  of  stamp  sales  by 
"fixed  credit  agents").  The  original  and  the  duplicate  copy  of  this  form  shall 
be  retained  one  calendar  month  after  the  date  of  the  last  shipment  recorded 
thereon,  after  which  the  agent  may  retain  or  destroy  them:  Provided,  however, 
that  when  (i)  unsold  stamps  or  the  proceeds  of  stamp  sales  are  lost,  stolen,  or 
destroyed  in  transit,  or  (ii)  the  agent  does  not  duly  account  for  stamps  (when 
and  as  required  under  the  provisions  of  sec.  338.8  (b)  or  (c)),  the  Form  PD  2950 


I 


296   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

(both  copies)  shall  be  retained  by  the  agent  until  one  calendar  month  after  the 
deficiency  is  removed,  unless  the  form  is  delivered  to  the  Treasury,  and  provided 
further  that  if  a  post  office  is  unable  to  return  to  the  agent  his  post  office  receipt 
form  covering  stamps  obtained  without  prepayment  at  the  time  a  full  accounting 
therefor  is  made,  the  Form  PD  2950  duly  noted  and  signed  by  the  postal  employee 
shall  be  retained  for  three  months  after  such  accounting. 

(c)  Other. — Other  records  prepared  and  maintained  by  and  for  the  agent's  own 
use  may  be  disposed  of  at  the  discretion  of  the  agent:  Provided,  however,  that 
any  records,  affidavits,  etc.,  that  are  prepared  in  connection  with  a  loss  which 
may  be  the  subject  of  a  claim  to  the  Treasury  for  relief  shall  be  retained  as  pro- 
vided in  section  338.10(d)  hereof. 

Sec.  338.10  Losses  in  transportation. — (a)  General. — The  Government  Losses 
in  Shipment  Act,  as  amended,  (5  U.S.C.  134-134h)  provides  protection  against 
losses  arising  from  shipments  of  valuables  made  at  the  risk  of  the  United  States, 
if  the  shipments  are  made  in  accordance  with  prescribed  regulations.  The  term 
"shipment"  as  used  herein  is  defined  (in  the  same  manner  as  provided  in  the 
Government  Losses  in  Shipment  Act,  as  amended)  to  mean  "the  transportation 
or  the  effecting  of  transportation  of  valuables  without  limitation  as  to  the  means 
or  facilities  used  *  *  *."  The  transportation  of  stamps  from  the  post  office 
to  the  school  and  of  unsold  stamps  and/or  cash  from  the  school  to  the  post  office 
by  or  in  the  possession  of  a  Treasury  savings  stamp  agent  acting  in  his  official 
capacity  are  shipments  of  valuables  at  the  risk  of  the  United  States.  Accord- 
ingly, an  agent  may  be  relieved  of  his  accountability  for  stamps  if  they  are  lost, 
stolen,  or  destroyed  in  shipment  (see  sec.  338.10(d)). 

(b)  Preparation  for  transportation. — The  amount  of  stamps  and/or  proceeds 
thereof  being  transported  from  or  to  the  post  office  must  be  established,  prior 
to  transportation,  by  actual  count  by  the  agent.  The  agent's  receipt  given  at 
the  post  office  for  stamps  obtained  without  prepayment  will  ordinarily  constitute 
an  adequate  record  of  the  amount  of  stamps  being  transported  by  the  agent  to  the 
school. 

(c)  Procedure  for  transportation  and  delivery. — An  agent  must  transport  and 
deliver  the  stamps  and/or  the  proceeds  thereof  in  person,  using  due  care  to  pre- 
vent loss,  theft,  or  destruction  in  transit.  The  agent's  trip  may  be  made  on  foot 
or  by  private  or  public  transportation  facilities. 

(d)  Report  of  losses  and  presentation  of  claims  for  relief. — Losses  occurring  during 
the  transportation  by  an  agent  of  stamps  or  the  proceeds  thereof  shall  be  promptly 
reported  by  the  agent  to  (i)  the  State  Director  who  certified  the  agent's  Applica- 
tion-Agreement, and  (ii)  the  post  office.  Local  police  authorities  should  also  be 
notified  if  the  loss  is  occasioned  by  theft.  If  prompt  recovery  of  the  loss  does  not 
seem  possible,  the  agent  should  supplement  the  report  of  loss  by  presenting  his 
claim  for  relief  to  the  State  Director  who,  in  turn,  will  present  it  for  consideration 
by  the  Treasury  Department.  The  agent's  claim  should  be  supported  by  the 
appropriate  duplicate  copy  of  Form  PD  2950;  the  report  of  any  investigation 
made;  action  taken  or  expected  to  be  taken  and  of  any  results  obtained  or  ex- 
pected; statements  by  the  agent  as  to  the  circumstances  and  cause  of  the  loss; 
and,  if  available,  statements  or  affidavits  of  any  witnesses  to  the  incident  causing 
the  loss.  The  foregoing  data  need  not  be  furnished  if  it  has  previously  been 
furnished  to  or  obtained  by  the  Treasury's  Secret  Service.  Stamp  agents  should 
bear  the  foregoing  requirements  in  mind  so  that  in  the  event  of  a  loss,  they  may 
be  in  a  position  to  obtain  data  for  justifying  a  claim  for  relief  from  the  loss. 
Unless  the  records  referred  to  herein  have  been  turned  over  to  the  Treasury  they 
should  be  retained,  notwithstanding  the  provisions  of  section  338.9  hereof,  until 
one  calendar  month  after  the  claim  is  settled.  An  agent  will  be  relieved  of  lia- 
bility for  a  loss  occurring  during  his  transportation  of  stamps  or  the  proceeds 
thereof,  unless  it  arose  as  a  result  of  his  failure  to  comply  with  the  provisions  of  this 
circular  and  instructions  issued  hereunder. 

Sec.  338.11  Action  by  postmasters  in  connection  with  an  agent's  failure  to 
account. — Postmasters  should  promptly  report  any  failure  of  an  agent  to  account 
when  due,  in  whole  or  in  part,  for  stamps  supplied  to  the  agent  without  prepay- 
ment. Such  reports  should  be  made  to  the  State  Director  of  the  U.S.  Savings 
Bonds  Division  who  certified  the  respective  agent's  Application-Agreement. 

Sec.  338.12  Termination  of  an  agent's  qualification. — The  Secretary  of  the 
Treasury,  the  Fiscal  Assistant  Secretary  of  the  Treasury,  the  National  Director, 
or  a  State  Director  of  the  U.S.  Savings' Bonds  Division  may  terminate  the  quali- 
fication of  a  Treasury  savings  stamp  agent  at  any  time  by  written  notice  to  the 
agent,  in  which  event  a  copy  of  such  notice  will  be  sent  to  the  post  office  con- 


EXHIBITS  297 

cerned.  A  qualified  agent  may  withdraw  from  and  discontinue  his  agency  by 
giving  an  appropriate  written  notice  to  the  office  of  the  State  Director  of  the  U.S. 
Savings  Bonds  Division  who  certified  the  agent's  Application-Agreement:  Pro- 
vided, however,  that  the  agent  will  be  obligated  to  make  a  full  accounting  for  all 
stamps  received  by  him  without  prepayment. 

Sec.  338.13  Continuation  of  existing  qualiUcations  of  stamp  agents.— Any 
person  who  is  a  qualified  agent  at  the  effective  date  of  the  revision  of  this  circular 
may  continue  to  act  under  such  qualification  subject  to  the  terms  and  conditions 
of  this  revision. 

Sec.  338.14  Miscellaneous. — The  Secretary  of  the  Treasury  reserves  the  right, 
in  his  discretion,  to  waive  or  modify  any  provision  or  provisions  of  these  regulations 
and  to  provide  supplementary  instructions  for  operations  hereunder.  Informa- 
tion as  to  any  such  actions  shall  be  promptly  furnished  to  agents  concerned. 

Julian  B.  Baird, 

Acting  Secretary  of  the  Treasury. 


Legislation 

ExfflBiT  9. — An  act  to  increase  for  a  one-year  period  the  public  debt  limit  set 
forth  in  section  21  of  the  Second  Liberty  Bond  Act 

[Public  Law  87-69,  87th  Congress,  H.R.  7677,  June  30,  1961] 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled,  That,  during  the        ■□  y,,- 
period  beginning  on  July  1,  1961,  and  ending  on  June  30,  1962,  the        temporary 
public  debt  limit  set  forth  in  the  first  sentence  of    section    21  of  increase, 

the  Second  Liberty  Bond    Act,    as   amended  (31    U.S.C.    757b), 
shall  be  temporarily  increased  by  $13,000,000,000. 

Approved  June  30,  1961. 


ExfflBiT  10. — An  act  to  authorize  adjustments  of  outstanding  old  series  currency, 

and  for  other  purposes 

[Public  Law  87-66,  87th  Congress,  S.  1619,  June  30,  1961] 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled,  That  this  Act  may    old  Series  Cur- 
be  cited  as  the  "Old  Series  Currency  Adjustment  Act".  rency  Adjust- 

Sec.  2.  For  the  purposes  of  this  Act—  "'^^  ^^^■ 

(a)  The  term  "Secretary"  means  the  Secretary  of  the  Treasury.    Definitions. 

(b)  The  term  "United  States  notes"  means  currency  notes  issued 
pursuant  to  the  first  section  of  the  Act  of  February  25,  1862  (12 
Stat.  345),  the  Act  of  July  11,  1862  (12  Stat.  532),  the  resolution 
of  January  17,  1863  (12  Stat.  822),  section  2  of  the  Act  of  March 
3,  1863  (12  Stat.  709),  or  section  3571  of  the  Revised  Statutes  of 
the  United  States  (31  U.S.C,  sec.  401). 

(c)  The  term  "Treasury  notes  of  1890"  means  currency  notes 

issued  pursuant  to  the  Act  of  July  14,  1890  (26  Stat.  289).  12  use  145. 

Sec.  3.  The  Secretary  of  the  Treasury  is  hereby  authorized  and    Transfer  of  gold 
directed  to  transfer  to  the  general  fund  of  the  Treasury,  to  be   ^^^  silver,  au- 
credited  as  a  public  debt  receipt,  the  following:  "^^  ^' 

(1)  Gold  held  as  security  for  gold  certificates  issued  prior 
to  January  30,  1934. 

(2)  Standard  silver  dollars  held  as  security  for,  or  for  the 
redemption  of,  silver  certificates  issued  prior  to  July  1,  1929. 

(3)  Standard  silver  dollars  held  as  security  for,  or  for  the 
redemption  of.  Treasury  notes  of  1890. 

Sec.  4.  The  Board  of  Governors  of  the  Federal  Reserve  System,    Federal  Reserve 
with  the  approval  of  the  Secretary,  may  require  any  Federal  Re-   notes. 
serve  bank  to  pay  to  the  Secretary,  to  be  credited  as  a  public  debt 
receipt,  an  amount  equal  to  the  amount  of  Federal  Reserve  notes 
of  any  series  prior  to  the  series  of  1928  issued  to  such  bank  and 
outstanding  at  the  time  of  such  payment. 


298 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Redemption  of 
currency. 


Continuing 
accountability. 


Leeal-tender 

notes. 

Reduction. 

20  Stat.  87. 


Federal  Reserve 
Act,  amendment. 
38  Stat.  251; 
48  Stat.  339. 


40  Stat.  236. 


Sec.  5.  Any  currency  the  funds  for  the  redemption  or  security 
of  which  have  been  transferred  pursuant  to  the  provisions  of  sec- 
tion 3  of  this  Act,  and  any  Federal  Reserve  notes  as  to  which 
payment  has  been  made  under  section  4  of  this  Act,  shall  there- 
after, upon  presentation  at  the  Treasury  for  redemption,  be 
redeemed  by  the  Secretary  from  the  general  fund  of  the  Treasury 
and  thereupon  retired. 

Sec.  6.  (a)  Except  as  provided  in  subsection  (c)  of  this  section, 
upon  completion  of  the  transfers  and  credits  authorized  and 
directed  by  section  3  of  this  Act  there  shall  be  carried  on  the  books 
of  the  Treasury  as  public  debt  bearing  no  interest  the  following: 

(1)  Gold  certificates  isssed  prior  to  January  30,  1934. 

(2)  Treasury  notes  of  1890. 

(3)  United  States  notes  issued  prior  to  July  1,  1929. 

(4)  Silver  certificates  issued  prior  to  July  1,  1929. 

(b)  Except  as  provided  in  subsection  (c)  of  this  section,  there 
shall  be  carried  on  the  books  of  the  Treasury  as  public  debt  bearing 
no  interest  Federal  Reserve  notes  as  to  which  payment  has  been 
made  to  the  Secretary  under  section  4  of  this  Act  and  the  amount 
of  the  payment  credited  as  a  public  debt  receipt  in  accordance 
with  such  section. 

(c)  The  Secretary  is  authorized  to  determine,  from  time  to 
time,  the  amount  of — 

(1)  outstanding  currency  of  any  type  designated  in  sub- 
sections (a)  and  (b)  of  this  section, 

(2)  circulating  notes  of  Federal  Reserve  banks,  issued  prior 
to  July  1,  1929,  for  which  the  United  States  has  assumed 
liability,  and 

(3)  circulating  notes  of  national  banking  associations,  issued 
prior  to  July  1,  1929,  for  which  the  United  States  has  assumed 
liability, 

which,  in  his  judgment,  have  been  destroyed  or  irretrievably  lost 
and  so  will  never  be  presented  for  redemption,  and  to  reduce 
accordingly  the  amount  or  amounts  thereof  outstanding  on  the 
books  of  the  Treasury  and  to  credit  such  amounts  to  the  appro- 
priate receipt  account. 

Sec.  7.  The  first  paragraph  of  the  Act  of  May  31,  1878,  entitled 
"An  Act  to  forbid  the  further  retirement  of  United  States  legal- 
tender  notes"  (31  U.S.C.,  sec.  404),  is  amended  by  inserting  im- 
mediately before  the  period  at  the  end  thereof  the  following: 
":  And  provided  further,  That  in  the  event  of  any  determination 
by  the  Secretary  of  the  Treasury  under  section  6  of  the  Old  Series 
Currency  Adjustment  Act  that  an  amount  of  said  notes  has  been 
destroyed  or  irretrievably  lost  and  so  will  never  be  presented  for 
redemption,  the  amount  of  said  notes  required  to  be  kept  in  cir- 
culation shall  be  reduced  by  the  amount  so  determined". 

Sec.  8.  (a)  The  fifth  paragraph  of  section  16  of  the  Federal 
Reserve  Act  (12  U.S.C.,  sec.  415)  is  amended  by  adding  at  the 
end  thereof  the  following  new  sentence:  "The  liability  of  a  Federal 
Reserve  bank  with  respect  to  its  outstanding  Federal  Reserve 
notes  shall  be  reduced  by  any  amount  paid  by  such  bank  to  the 
Secretary  of  the  Treasury  under  section  4  of  the  Old  Series  Cur- 
rency Adjustment  Act." 

(b)  The  seventh  paragraph  of  section  16  of  the  Federal  Reserve 
Act  (12  U.S.C.,  sec.  416)  is  amended  by  striking  out  the  third 
sentence  and  inserting  in  lieu  thereof  the  following:  "Any  Federal 
Reserve  bank  shall  further  be  entitled  to  receive  back  the  collateral 
deposited  with  the  Federal  Reserve  agent  for  the  security  of  any 
notes  with  respect  to  which  such  bank  has  made  payment  to  the 
Secretary  of  the  Treasury  under  section  4  of  the  Old  Series  Cur- 
rency Adjustment  Act.  Federal  Reserve  banks  shall  not  be 
required  to  maintain  the  reserve  or  the  redemption  fund  heretofore 
provided  for  against  Federal  Reserve  notes  which  have  been 
retired,  or  as  to  which  payment  has  been  made  to  the  Secretary 
of  the  Treasury  under  section  4  of  the  Old  Series  Currency  Ad- 
justment Act." 


EXHIBITS  299 

Sec.  9.  Nothing  contained  in  this  Act  shall  impair  the  redeem-   Redeemahiuty. 
ability  of  any  currency  of  the  United  States  as  now  provided  by 
law. 

Sec.  10.  In  order  to  provide  a  historical  collection  of  the  paper  Historical 
currency  issues  of  the  United  States,  the  Secretary  of  the  Treasury  collection, 
is  authorized,  after  redemption,  to  withhold  from  cancellation 
and  destruction  and  to  transfer  to  a  special  account  one  piece  of 
each  design,  issue,  or  series  of  each  denomination  of  each  kind  of 
paper  currency  of  the  United  States,  including  bank  notes,  hereto- 
fore or  hereafter  issued,  and  to  make  appropriate  entries  in  the 
redemption  accounts  and  other  books  of  the  Treasurv  to  cover 
any  such  transfers. 

Approved  June  30,  1961. 


I 


Public  Debt  Management 

Exhibit  11. — Statement  by  Secretary  of  the  Treasury  Dillon,  June  27,  1961, 
before  the  Senate  Finance  Committee  on  a  new  temporary  public  debt  limit 

I  am  here  today  in  support  of  a  new  temporary  limit  of  $298  billion  on  the  public 
debt  for  the  fiscal  year  1962. 

Under  the  existing  legislation  the  current  temporary  ceiling  of  $293  billion 
reverts  at  the  end  of  this  month  to  $285  billion.  On  that  date,  June  30,  1961, 
which  is  now  just  a  few  days  away,  we  estimate  that  the  public  debt  subject  to 
limitation  will  be  about  $289  billion.  This  is  expected  to  include  a  cash  balance 
of  approximately  $5]4  billion,  which  is  about  the  usual  balance  for  the  end  of  the 
fiscal  year. 

During  the  next  twelve  months,  the  fiscal  year  1962,  we  expect  revenues  to  fall 
short  of  expenditures.  On  the  assumption  that  we  are  able  to  closeout  fiscal  year  1962 
with  a  minimum  working  cash  balance  as  low  as  $3.5  billion,  we  estimate  a  total 
public  debt  subject  to  limitation  of  about  $290  billion  on  June  30,  1962.  Because 
of  normal  seasonal  factors,  however,  the  end-of-June  debt  position  is  generally 
well  below  the  high  point  reached  during  the  fiscal  year.  Our  current  projections 
(as  shown  in  table  1)  indicate  a  net  increase  of  about  $6  billion  in  the  public  debt 
for  the  rest  of  the  calendar  year  to  a  high  of  about  $295  billion  in  December. 

In  addition  it  is  prudent  to  set  the  debt  limit  at  a  level  that  makes  a  reasonable 
provision  for  errors  in  the  estimates  as  well  as  other  unforeseen  contingencies,  and 
permits  sufficient  flexibility  in  debt  management  so  that  the  efficiency  of  day-to- 
day operations  is  not  impaired.  To  provide  this  margin,  I  believe  that  an 
allowance  of  $3  billion,  the  same  allowance  that  has  been  made  in  previous  years, 
should  be  added  to  the  projected  high  point  of  $295  billion  in  the  public  debt 
during  fiscal  year  1962.  This  clearly  indicates  the  need  for  a  temporary  debt 
ceiling  of  $298  billion  in  the  forthcoming  fiscal  year. 

As  you  know,  setting  the  temporary  debt  limit  at  $298  billion  is  by  no  means  a 
"license"  to  spend  freely  out  of  borrowings  up  to  that  amount.  Federal  expendi- 
tures are  determined  on  the  basis  of  congressional  authorizations  and  appropria- 
tions, and  I  am  wholeheartedly  in  support  of  observing  strict  discipline  in  weighing 
the  merits  of  the  many  competing  demands  for  additional  expenditures.  If  the 
Congress  wished  to  set  limits  on  its  own  actions  in  authorizing  expenditures,  it 
could  do  so  directly  by  placing  a  ceiling  on  new  spending  authorizations  in  any 
year.  There  is  no  way  by  which  the  debt  ceiling  can  be  effective  in  limiting 
congressional  authorizations  to  spend,  because  there  is  no  direct  and  immediate 
connection  between  congressional  authorizations  and  their  effects  on  the  public 
debt  which  will  be  felt  months  or  even  years  later,  when  the  spending  takes  place. 

In  arriving  at  the  projected  need  for  a  temporary  debt  ceiling  of  $298  billion, 
the  latest  budget  estimates  have  been  taken  into  account,  including  full  allowance 
for  all  of  the  new  or  expanded  programs  recommended  by  the  President  in  his 
message  of  May  25  on  "Urgent  National  Needs."  Budget  outlays  for  fiscal  1962 
are  now  estimated  at  $85.1  billion.  The  increase  of  $800  million  from  the  $84.3 
billion  figure  reported  in  late  March  largely  represents  additional  funds  for  space 
exploration,  defense  and  military  assistance,  expanded  lending  to  small  business, 
and  programs  to  alleviate  structural  unemployment.  Budget  revenues  are  still 
estimated  at  $81.4  billion,  the  same  as  reported  in  March,  indicating  a  deficit  of 

614359—62 20 


300    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

$3.7  billion.  These  spending  and  revenue  projections  have  been  based  on  the 
assumption  that  the  Congress  would  act  favorably  on  the  President's  recommenda- 
tions to  put  the  highway  building  program  on  a  fully  self-sustaining  basis,  to 
eliminate  the  postal  deficit  by  raising  postal  rates,  and  to  maintain  various  tax 
rates  otherwise  scheduled  for  reduction  or  termination.  Since  the  preparation 
of  these  estimates  the  Congress  has  acted  favorably  on  the  President's  request 
for  continuation  of  existing  tax  rates.  In  addition  the  Congress  has  completed 
action  on  the  highway  financing  bill  which  avoids  any  diversion  of  general  revenues 
during  fiscal  1962.  However,  there  has  as  yet  been  no  action  on  postal  rate 
increases  which  were  recommended  in  the  amount  of  $741  million.  If  the  Con- 
gress fails  to  act  on  this  legislation  the  expected  fiscal  1962  deficit  would  be 
increased  to  $4.4  billion,  and  the  Treasury's  margin  of  flexibility  would  be  reduced 
to  $2^  billion. 

I  might  add  that  the  currently  projected  budget  deficit  of  $3.7  billion  for  the 
fiscal  year  1962  compares  with  deficits  of  $4.2  billion  and  $12.4  billion  in  the 
fiscal  years  following  the  two  previous  business  recessions  (the  fiscal  years  1955 
and  1959).  It  may  seem  incongruous  that  with  a  vigorous  recovery  already  under 
way,  we  nonetheless  expect  a  deficit  next  year.  The  reason  for  this  deficit  is 
simple.  Corporate  income  tax  revenues,  as  you  know,  are  highly  important  in 
our  overall  revenue  structure.  But  the  corporate  tax  revenues  which  will  be 
available  to  us  in  fiscal  1962  will  be  based  on  corporate  profits  during  the  present 
calendar  year  which  includes  the  lowest  point  of  the  recession.  In  effect,  while 
the  economy  is  recovering,  our  corporate  income  tax  revenues  will  still  be  at 
recession  levels.  The  same  applies,  to  a  somewhat  lesser  extent,  to  individual 
income  tax  collections  above  the  standard  withholding  deductions,  because  these 
collections  are  largely  dependent  on  incomes  realized  during  calendar  year  1961. 
Therefore,  the  coming  fiscal  year  will  be  one  of  continued  recession  revenues  as 
far  as  the  Federal  Government  is  concerned. 

On  the  spending  side  the  latest  estimates  indicate  that  the  January  budget 
underestimated  expenditures  for  going  programs  by  about  $400  million.  In 
addition  President  Kennedy  has  proposed  certain  programs  which  he  considers 
vital  in  terms  of  fulfilling  needs  for  national  defense,  promoting  a  healthy  and 
vigorously  growing  economy  at  home,  and  meeting  the  challenge  of  space  explora- 
tion. Total  budgetary  expenditures  for  these  new  proposals  in  fiscal  year  1962 
are  expected  to  amount  to  $3.8  billion.  The  main  increases  in  spending  that  we 
expect  for  1962,  compared  with  those  in  the  January  budget  message,  are  for 
defense,  extended  unemployment  compensation,  aid  to  education,  agricultural 
programs,  and  space  exploration.  The  spending  for  unemployment  compensation 
is  under  a  program  very  similar  to  what  was  done  in  1958.  A  substantial  portion 
of  the  additional  spending  on  agricultural  programs  represents  the  use  of 
more  realistic  assumptions  in  preparing  our  spending  estimates.  In  the  areas  of 
defense  spending  and  space  exploration,  the  force  of  external  events  has  called 
for  additional  programs  that  would  and  should  have  been  undertaken,  in  some 
form,  whatever  administration  was  in  office.  In  short,  in  my  view  the  budget 
changes  since  January  simply  do  not  add  up  to  the  picture  of  unrestrained  spend- 
ing that  some  have  sought  to  draw. 

Moreover,  the  deficit  now  anticipated  for  fiscal  year  1962  will  not  have  an 
inflationary  impact  on  our  economy.  For  while  we  do  expect  the  economy 
throughout  this  period  to  be  recovering  sturdily,  the  period  as  a  whole  will  not 
be  one  of  full  prosperity.  For  today  there  is  substantial  unused  capacity  in 
every  part  of  our  industrial  structure,  and  most  seriously  in  our  labor  force. 
Rather  than  creating  the  inflationary  pressures  that  are  inevitably  associated 
with  deficits  in  times  of  full  employment,  the  deficit  we  anticipate  in  the  coming 
fiscal  year  will  be  helpful  in  putting  our  unused  plant  capacity  and  labor  force 
to  work. 


EXHIBITS  301 

Looking  further  ahead  we  can  and  do  foresee  a  sharp  increase  in  revenues  in 
fiscal  year  1963.  This  follows  the  same  pattern  as  in  previous  recovery  periods. 
Revenues  increased  very  substantially  in  the  fiscal  years  1956  and  1960.  In 
fact,  during  fiscal  year  1960  the  increase  over  the  preceding  year  amounted  to 
$9.8  billion.  While  naturally  we  cannot  make  any  firm  prediction  at  this  point, 
I  believe  it  is  a  reasonable  expectation  that  we  will  be  able  to  present  a  budget 
for  fiscal  year  1963  in  which  receipts  exceed  expenditures.  For  as  the  President 
stated  in  his  message  on  budget  and  fiscal  policy  of  March  24,  1961: 

"Federal  revenues  and  expenditures  *  *  *  should,  apart  from  any  threat  to 
national  security,  be  in  balance  over  the  years  of  the  business  cycle — running  a 
deficit  in  years  of  recession  when  revenues  decline  and  the  economy  needs  the 
stimulus  of  additional  expenditures,  and  running  a  surplus  in  years  of  prosperity, 
thus  curbing  inflation,  reducing  the  public  debt,  and  freeing  funds  for  private 
investment." 

This  statement  by  President  Kennedy  clearly  outlines  our  budgetary  policy,  a 
policy  from  which  we  have  never  wavered. 

Our  projections  of  the  public  debt  at  semimonthly  intervals  during  the  fiscal 
year  1962  are  shown  in  the  first  table  attached  to  my  statement.  One  important 
assumption  in  preparing  these  projections  is  that  the  Treasury's  operating  balance 
at  the  Federal  Reserve  Banks  and  private  commercial  banks  would  hold  steady 
throughout  the  period  at  $3.5  billion.  That  is  actually  a  rather  low  working 
balance  for  an  operation  as  large  and  as  subject  to  sharp  fluctuations  in  receipts 
and  expenditures  as  is  the  management  of  the  Treasury's  cash  position.  A 
balance  of  $3.5  billion  would  cover  only  a  little  over  half  of  an  average  month's 
budget  expenditures,  which  is  a  much  lower  ratio  of  cash  holdings  to  expenditures 
than  is  maintained  by  the  average  business  corporation. 

In  fact,  as  shown  in  the  second  attached  table,  the  operating  balance  has 
been  more  often  above  than  below  $3.5  billion  during  the  fiscal  year  now  ending. 
It  has  averaged  closer  to  $5  billion  than  to  $3.5  billion,  and  this  has  provided  a 
highly  desirable  and  important  degree  of  flexibility  in  the  efficient  conduct  of 
day-to-day  Treasury  operations.  It  is  because  of  this  need  for  flexibility  in  the 
management  of  cash  balances,  and  because  of  the  inescapable  uncertainties  of 
revenue  and  expenditure  estimates,  that  the  $3  billion  margin  has  been  added  to 
our  calculation  of  the  appropriate  debt  ceiling. 

As  you  can  see  from  the  first  table,  our  debt  projections,  plus  the  $3  billion 
allowance  for  flexibility,  will  reach  a  high  point  of  $298  billion  during  the  winter 
months.  A  temporary  limit  of  that  amount  should  give  us  sufficient  elbowroom 
for  maximum  efficiency  of  operations  and  yet  not  impair  any  useful  function  which 
may  be  served  by  the  public  debt  limitation. 

The  intended  function  of  the  debt  limit  is  but  poorly  served,  I  think,  when  a 
specific  limit  fits  so  closely  that  the  Treasury  is  forced  to  obtain  additional  funds — 
at  higher  cost — through  the  market  borrowings  of  Federal  agencies  not  subject  to 
the  statutory  debt  limit.  Indeed  the  Government  was  forced  to  take  such  steps  a 
few  years  ago  when  the  debt  ceiling  imposed  too  tight  a  limit  on  Government 
fiscal  operations.  In  addition  the  Treasury  in  its  own  borrowings  has  at  times  had 
to  defer  borrowings  when  it  would  have  been  advantageous,  or  to  engage  in 
piecemeal  borrowings  because  of  the  limitations  of  too  little  margin  under  the 
debt  ceiling. 

In  conclusion,  I  believe  that  a  temporary  increase  in  the  debt  limit  to  $298 
billion  is  essential  to  the  orderly  and  economical  management  of  the  Govern- 
ment's finances,  and  I  earnestly  recommend  its  prompt  approval  by  this  com- 
mittee. 


302    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  I. — Forecast  of  public  debt  outstanding,  fiscal  year  1962,  based  on  constant 
operating  cash  balance  of  $3.5  billion  (excluding  free  gold) 
[In  billions  of  dollars.    Based  on  assumed  budget  deficit  of  $3.7  billion]  ' 


Operating  bnl- 
avce,  Federal 
Reserve  Banks 

and  deposi- 
taries (excluding 
free  gold) 


Public  debt 
subject  to 
limitation 


Allowance  to 
provide  flexibil- 
ity in  financ- 
ing and  for 
contingencies 


Total  public 

debt  limitation 

required  ^ 


190! 

June  30 

July  15 

July  31 

August  15 

August  31 

September  15 

September  30 

October  15 

October  31 

November  15 

November  30 

December  15 

December  31 

January  15 

January  31 

February  15 

February  28 

March  15 

March  31 

April  15 

April  30 

Mavl5 

May  31 

June  15 

June  30 


$3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 


3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 
3.5 


$286.  4 
288.6 
289.6 
289.9 
290.1 
291.9 
288.2 
290.7 
292.2 
293.0 
292.8 
294.9 
292.4 


294.9 
294.0 
294.1 
293.2 
294.7 
291.2 
293.4 
292.7 
291.9 
292.3 
293.6 
290.1 


$3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 


3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 
3.0 


$289.  4 
291.6 
292.6 
292.9 
290.1 
294.9 
291.2 
293.7 
295.2 
296.0 
295.8 
297.9 
295.4 


297.9 
297.0 
297.1 
296.2 
297.7 
294.2 
296.4 
295.7 
294.9 
295.3 
296.6 
293.1 


1  Incorporates  estimated  budget  revenues  of  $81.4  billion  and  estimated  expenditures  of  $85.1  billion. 

2  From  July  1,  19G0,  to  June  30,  1961,  the  statutory  debt  limit  is  $293  billion.    Thereafter  it  will  revert  to 
$285  billion. 

'  Because  the  actual  operating  balance  on  June  30, 1961 ,  is  expected  to  be  considerably  larger  than  $3.5  billion 
the  pubUc  debt  subject  to  limitation  will  be  about  $289  billion  on  that  date. 


Table  II.- 


-Actual  cash  balance  and  public  debt  outstanding  July  1960 — May  1961 
[In  billions  of  dollars] 


1960 

July  15 

July  31 

August  15 

August  31 - 

September  15 

September  30 --- 

October  15 

October  31 

November  15-- - - 

November  30 

December  15 

December  31 

1961 

January  15 

January  31 

February  15 - 

February  28 --. 

March  15 -. 

March  31 -- 

April  15 

April  30 - -- -- 

May  15 -. 

May  31 


Operating  bal- 
ance. Federal 
Reserve  Banks 

and  deposi- 
taries (excluding 
free  gold) 


Public  debt 
subject  to 
limitation 


$288.  6 
288.1 
287.5 
288.4 
288.3 
288.2 
287.2 
290.2 
289.9 
290.2 
290.0 
290.0 


289.9 
289.8 
290.5 
290.3 
290.0 
287.3 
288.4 
287.8 
288.8 
290.0 


Note.— From  July  1,  1960,  to  June  30,  1961,  the  statutory  debt  limit  is  $293  billion, 
revert  to  $285  billion. 


Thereafter  it  will 


EXHIBITS  303 

Taxation  Developments 

Exhibit  12.— Message  from  the  President,  April  20,  1961,  relative  to  the  Federal 

tax  system 

[House  Document  No.  140,  87th  Congress,  1st  sess. 

To  the  Congress  of  the  United  States: 

A  strong  and  sound  Federal  tax  sj'stem  is  essential  to  America's  future.  Without 
such  a  system,  we  cannot  maintain  our  defenses  and  give  leadership  to  the  free 
world.  Without  such  a  system,  we  cannot  render  the  public  services  necessary  for 
enriching  the  lives  of  our  people  and  furthering  the  growth  of  our  economy. 

The  tax  system  must  be  adequate  to  meet  our  public  needs.  It  must  meet 
them  fairly,  calling  on  each  of  us  to  contribute  his  proper  share  to  the  cost  of 
government.  It  must  encourage  efficient  use  of  our  resources.  It  must  promote 
economic  stability  and  stimulate  economic  growth.  Economic  expansion  in 
turn  creates  a  growing  tax  base,  thus  increasing  revenue  and  thereby  enabling 
us  to  meet  more  readily  our  public  needs,  as  well  as  our  needs  as  private  individuals. 

This  message  recognizes  the  basic  soundness  of  our  tax  structure.  But  it  also 
recognizes  the  changing  needs  and  standards  of  our  economic  and  international 
position,  and  the  constructive  reform  needs  to  keep  our  tax  system  up  to  date 
and  to  maintain  its  equity.  Previous  messages  have  emphasized  the  need  for 
prompt  congressional  and  executive  action  to  alleviate  the  deficit  in  our  inter- 
national balance  of  payments — to  increase  the  modernization,  productivity,  and 
competitive  status  of  American  industrj^ — to  stimulate  the  expansion  and  growth 
of  our  economy — to  eliminate  to  the  extent  possible  economic  injustice  within 
our  own  society  and  to  maintain  the  level  of  revenues  requested  in  my  predeces- 
sor's budget.  In  each  of  these  endeavors,  tax  policy  has  an  important  role  to  play 
and  necessary  tax  changes  are  herein  proposed. 

The  elimination  of  certain  defects  and  inequities  as  proposed  below  will  provide 
revenue  gains  to  offset  the  tax  reductions  offered  to  stimulate  the  economy. 
Thus  no  net  loss  of  revenue  is  involved  in  this  set  of  proposals.  I  wish  to  emphasize 
here  that  they  are  a  "set" — -and  that  considerations  of  both  revenue  and  equity, 
as  well  as  the  interrelationship  of  many  of  the  proposals,  urge  their  consideration 
as  a  unit. 

I  am  instructing  the  Secretary  of  the  Treasury  to  furnish  the  Committee  on 
Ways  and  Means  of  the  House  a  detailed  explanation  of  these  proposals  in  con- 
nection with  their  legislative  consideration. 

I.  Long-range  tax  reform 

While  it  is  essential  that  the  Congress  receive  at  this  time  this  administration's 
proposals  for  urgent  and  obvious  tax  adjustments  needed  to  fulfill  the  aims  listed 
above,  time  has  not  permitted  the  comprehensive  review  necessary  for  a  tax 
structure  which  is  so  complicated  and  so  critically  important  to  so  many  people. 
This  message  is  but  a  first  though  urgent  step  along  the  road  to  constructive 
reform. 

I  am  directing  the  Secretary  of  the  Treasury,  building  on  recent  tax  studies  of 
the  Congress,  to  undertake  the  research  and  preparation  of  a  comprehensive 
tax  reform  program  to  be  placed  before  the  next  session  of  the  Congress. 

Progressing  from  these  studies,  particularly  those  of  the  Committee  on  Ways 
and  Means  and  the  Joint  Economic  Committee,  the  program  should  be  aimed  at 
providing  a  broader  and  more  uniform  tax  base,  together  with  an  appropriate 
rate  structure.  We  can  thereby  work  toward  the  goal  of  a  higher  rate  of  economic 
growth,  a  more  equitable  tax  structure,  and  a  simpler  tax  law.  I  know  these 
objectives  are  shared  by — and,  at  this  particular  time  of  year,  acutely  desired 
by — the  vast  majority  of  the  American  people. 

In  meeting  the  demands  of  war  finance,  the  individual  income  tax  moved  from 
a  selective  tax  imposed  on  the  wealthy  to  the  means  by  which  the  great  majority 
of  our  citizens  participates  in  paying  for  well  over  one-half  of  our  total  budget 
receipts.  It  is  supplemented  by  the  corporation  income  tax,  which  provides  for 
another  quarter  of  the  total. 

This  emphasis  on  income  taxation  has  been  a  sound  development.  But  so  many 
taxpayers  have  become  so  preoccupied  with  so  many  tax-saving  devices  that 


304    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

business  decisions  are  interfered  with,  and  the  efficient  functioning  of  the  price 
system  is  distorted. 

Moreover,  special  provisions  have  developed  into  an  increasing  source  of 
preferential  treatment  to  various  groups.  Whenever  one  taxpayer  is  permitted 
to  pay  less,  someone  else  must  be  asked  to  pay  more.  The  uniform  distribution 
of  the  tax  burden  is  thereby  disturbed  and  higher  rates  are  made  necessary  by  the 
narrowing  of  the  tax  base.  Of  course,  some  departures  from  uniformity  are  needed 
to  promote  desirable  social  or  economic  objectives  of  overriding  importance 
which  can  be  achieved  most  effectively  through  the  tax  mechanism.  But  many 
of  the  preferences  which  have  developed  do  not  meet  such  a  test  and  need  to  be 
reevaluated  in  our  tax  reform  program. 

It  will  be  a  major  aim  of  our  tax  reform  program  to  reverse  this  process  by 
broadening  the  tax  base  and  reconsidering  the  rate  structure.  The  result  should 
be  a  tax  system  that  is  more  equitable,  more  efficient,  and  more  conducive  to 
economic  growth. 

II.  Tax  incentive  for  modernization  and  expansion 

The  history  of  our  economy  has  been  one  of  rising  productivity,  based  on  im- 
provement in  skills,  advances  in  technology,  and  a  growing  supply  of  more  efficient 
tools  and  equipment.  This  rise  has  been  reflected  in  rising  wages  and  standards 
of  living  for  our  workers,  as  well  as  a  healthy  rate  of  growth  for  the  economy  as  a 
whole.  It  has  also  been  the  foundation  of  our  leadership  in  world  markets,  even 
as  we  enjoyed  the  highest  wage  rates  in  the  world. 

Today,  as  we  face  serious  pressure  on  our  balance-of-payments  position,  we  must 
give  special  attention  to  the  modernization  of  our  plant  and  equipment.  Forced 
to  reconstruct  after  wartime  devastation,  our  friends  abroad  now  possess  a  modern 
industrial  system  helping  to  make  them  formidable  competitors  in  world  markets. 
If  our  own  goods  are  to  compete  with  foreign  goods  in  price  and  quality,  both  at 
home  and  abroad,  we  shall  need  the  most  efficient  plant  and  equipment. 

At  the  same  time,  to  meet  the  needs  of  a  growing  population  and  labor  force, 
and  to  achieve  a  rising  per  capita  income  and  employment  level,  we  need  a  high 
and  rising  level  of  both  private  and  public  capital  formation.  In  my  preceding 
messages,  I  have  proposed  programs  to  meet  some  of  our  needs  for  such  capital 
formation  in  the  public  area,  including  investment  in  intangible  capital  such  as 
education  and  research,  as  well  as  investment  in  physical  capital  such  as  buildings 
and  highways.  I  am  now  proposing  additional  incentives  for  the  modernization 
and  expansion  of  private  plant  and  equipment. 

Inevitably,  capital  expansion  and  modernization — now  frequently  under  the 
name  of  automation — alter  established  modes  of  production.  Great  benefits 
result  and  are  distributed  widely — but  some  hardships  result  as  well.  This  places 
heavy  responsibilities  on  public  policy,  not  to  retard  modernization  and  capital 
expansion  but  to  promote  growth  and  ameliorate  hardships  when  they  do  occur — 
to  maintain  a  high  level  of  demand  and  employment,  so  that  those  who  are  dis- 
placed will  be  reabsorbed  quickly  into  new  positions — and  to  assist  in  retraining 
and  finding  new  jobs  for  such  displaced  workers.  We  are  developing,  through  such 
measures  as  the  area  redevelopment  bill  and  a  strengthened  employment  service, 
as  well  as  assistance  to  the  unemployed,  the  programs  designed  to  achieve  these 
objectives. 

High  capital  formation  can  be  sustained  only  by  a  high  and  rising  level  of 
demand  for  goods  and  service.  Indeed,  the  investment  incentive  itself  can  con- 
tribute materially  to  achieving  the  prosperous  economy  under  which  this  incentive 
will  make  its  maximum  contribution  to  economic  growth.  Rather  than  delaying 
its  adoption  until  all  excess  capacity  has  disappeared  and  unemployment  is  low, 
we  should  take  this  step  now  to  strengthen  our  antirecession  program,  stimulate 
employment,  and  increase  our  export  markets. 

Additional  expenditures  on  plant  and  equipment  will  immediately  create  more 
jobs  in  the  construction,  lumber,  steel,  cement,  machinery,  and  other  related 
capital  goods  industries.  The  staffing  of  these  new  plants — and  filling  the  orders 
for  new  export  markets — will  require  additional  employees.  The  additional 
wages  of  these  workers  will  help  create  still  more  jobs  in  consumer  goods  and  serv- 
ice industries.  The  increase  in  jobs  resulting  from  a  full  year's  operation  of  such 
an  incentive  is  estimated  at  about  half  a  million. 


EXHIBITS  305 

Specifically,  therefore,  I  recommend  enactment  of  an  investment  tax  incentive 
in  the  form  of  a  tax  credit  of — 

Fifteen  percent  of  all  new  plant  and  equipment  investment  expenditures 
in  excess  of  current  depreciation  allowances; 

Six  percent  of  such  expenditures  below  this  level  but  in  excess  of  50 
percent  of  depreciation  allowances;  with 

Ten  percent  on  the  first  $5,000  of  new  investment  as  a  minimum  credit. 
This  credit  would  be  taken  as  an  offset  against  the  firm's  tax  liability,  up  to  an 
overall  limitation  of  30  percent  in  the  reduction  of  that  liability  in  any  one  year. 
It  would  be  separate  from  and  in  addition  to  depreciation  of  the  eligible  new 
investment  at  cost.  It  would  be  available  to  individually  owned  businesses  as 
well  as  corporate  enterprises,  and  apply  to  eligible  investment  expenditures  made 
after  January  1  of  this  year.  To  remain  a  real  incentive  and  make  a  maximum 
contribution  to  those  areas  of  capital  expansion  and  modernization  where  it  is 
most  needed,  and  to  permit  efficient  administration,  eligible  investment  expendi- 
tures would  be  limited  to  expenditures  on  new  plant  and  equipment,  on  assets 
located  in  the  United  States,  and  on  assets  with  a  life  of  6  years  or  more.  Invest- 
ments by  public  utilities  other  than  transportation  would  be  excluded,  as  would  be 
investment  in  residential  construction  including  apartments  and  hotels. 

Of  the  eligible  firms,  it  is  expected  that  many  small  firms  would  be  able  to  take 
advantage  of  the  minimum  credit  of  10  percent  on  the  first  $5,000  of  new  invest- 
ment which  is  designed  to  provide  a  helpful  stimulus  to  the  many  small  businesses 
in  need  of  modernization.  Other  small  firms,  subject  to  a  30  percent  tax  rate, 
would  strive  to  be  eligible  for  the  full  15  percent  credit — the  equivalent  for  such 
firms  of  a  deduction  from  their  gross  income  for  tax  purposes  of  50  percent  of  the 
cost  of  new  investment.  Among  the  remaining  firms  it  is  expected  that  a  majority 
would  be  induced  to  make  new  investments  in  modern  plant  and  equipment  in 
excess  of  their  depreciation  in  order  to  earn  the  15  percent  credit.  New  and  grow- 
ing firms  would  be  particularly  benefited.  The  6  percent  credit  for  those  whose 
new  investment  expenditures  fall  between  50  and  100  percent  of  their  depreciation 
allowances  is  designed  to  afford  some  substantial  incentive  to  the  depressed  or 
hesitant  firm  which  knows  it  cannot  yet  achieve  the  15  percent  credit. 

In  arriving  at  this  form  of  tax  encouragement  to  investment,  careful  consider- 
ation was  given  to  other  alternatives.  If  the  credit  were  given  across  the  board 
to  all  new  investment,  a  much  larger  revenue  loss  would  result  from  those  expend- 
itures which  would  have  been  undertaken  anyway  or  represent  no  new  level  of 
effort.  Our  objective  is  to  provide  the  largest  possible  inducement  to  new  invest- 
ment which  would  not  otherwise  be  undertaken.  Thus  the  plan  recommended 
above  would  involve  the  same  revenue  loss — approximately  $1.7  billion — as  only 
a  7  percent  credit  across  the  board  to  all  new  investment. 

The  use  of  current  depreciation  allowances  as  the  threshold  above  which  the 
higher  rate  of  credit  would  apply  recommends  itself  for  a  number  of  reasons.  De- 
preciation reflects  the  average  level  of  investment  over  the  past,  but  is  a  less 
restrictive  and  more  stable  test  than  the  use  of  an  average  of  investment  expendi- 
tures for  a  period  such  as  the  preceding  5  years.  In  addition,  the  depreciation 
allowances  themselves  in  effect  supply  tax-free  funds  for  investment  up  to  this 
level.  We  now  propose  a  tax  credit — which  would  help  to  secure  funds  needed 
for  the  additional  investment  beyond  that  level. 

The  proposed  credit,  in  terms  of  the  revenue  loss  involved,  will  also  be  much 
more  effective  as  an  inducement  to  investment  than  an  outright  reduction  in  the 
rate  of  corporation  income  tax.  Its  benefits  would  be  distributed  more  broadly, 
since  the  proposed  credit  will  apply  to  individuals  and  partnerships  as  well  as 
corporations.  It  will  also  be  more  effective  as  a  direct  incentive  to  corporate 
investment,  and  increase  available  funds  more  specifically  in  those  corporations 
most  likely  to  use  them  for  additional  investment.  In  short,  whereas  the  credit 
will  have  the  advantage  of  focusing  on  the  profitability  of  new  investment,  much 
of  the  revenue  loss  under  a  general  corporate  rate  reduction  would  be  diverted 
into  raising  the  profitability  of  old  investment. 

It  is  true  that  this  advantage  of  focusing  entirely  on  new  investment  is  shared 
by  the  alternative  strongly  urged  by  some — a  tax  change  permitting  more  rapid 
depreciation  of  new  assets  (be  it  accelerated  depreciation  or  an  additional  depre- 
ciation allowance  for  the  first  year).  But  the  proposed  investment  credit  would 
be  superior,  in  my  view,  for  a  number  of  reasons.  In  the  first  place,  the  deter- 
mination of  the  length  of  an  asset's  life  and  proper  methods  of  depreciation  have 
a  normal  and  important  function  in  determining  taxable  income,  wholly  apart 
from  any  considerations  of  incentive;  and  they  should  not  be  altered  or  manipulated 


306   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

for  other  purposes  that  would  interfere  with  this  function.  It  may  be  that  on 
examination  some  of  the  existing  depreciation  rules  will  be  found  to  be  outmoded 
and  inequitable;  but  that  is  a  question  that  should  be  separated  from  investment 
incentives.  A  review  of  these  rules  and  methods  is  underway  in  the  Treasury 
Department  as  a  part  of  its  overall  tax  reform  study  to  determine  whether  changes 
are  appropriate  and,  if  so,  what  form  they  should  take.  Adoption  of  the  proposed 
incentive  credit  would  in  no  way  foreclose  later  action  on  these  aspects  of 
depreciation. 

In  second  place,  an  increase  in  tax  depreciation  tends  to  be  recorded  in  the 
firm's  accounts,  thereby  raising  current  costs  and  acting  as  a  deterrent  to  price 
reduction.     The  proposed  investment  credit  would  not  share  this  defect. 

Finally,  it  is  clear  that  the  tax  credit  would  be  more  effective  in  inducing  new 
investment  for  the  same  revenue  loss.  The  entire  credit  would  be  reflected  im- 
mediately in  the  increased  funds  available  for  investment  without  increasing  the 
company's  future  tax  liability.  A  speedup  in  depreciation  only  postpones  the 
timing  of  the  tax  liability  on  profits  from  the  investment  to  a  later  date — an 
increase  in  profitability  not  comparable  to  that  of  an  outright  tax  credit.  Yet 
accelerated  depreciation  is  much  more  costly  in  immediate  revenues. 

For  example,  on  an  average  investment,  a  tax  credit  of  15  percent  would  bring 
the  same  return  to  the  firm  as  an  additional  first  year  depreciation  of  over  50  per- 
cent of  the  cost  of  the  investment.  Yet  the  immediate  revenue  loss  to  the  Treas- 
ury from  such  additional  depreciation  would  be  twice  as  much,  and  would  remain 
considerably  higher  for  many  years.  The  incentive  to  new  investment  our  econ- 
omy needs,  and  which  this  recommendation  would  provide  at  a  revenue  loss  of 
$1.7  billion,  could  be  supplied  by  an  initial  writeoff  only  at  an  immediate  cost  of 
$3.4  billion. 

I  believe  this  investment  tax  credit  will  become  a  useful  and  continuous  part  of 
our  tax  structure.  But  it  will  be  a  new  venture  and  remain  in  need  of  review. 
Moreover,  it  may  prove  desirable  for  the  Congress  to  modify  the  credit  from  time 
to  time  so  as  to  adapt  it  to  the  needs  of  a  changing  economy.  I  strongly  urge 
its  adoption  in  this  session. 

III.  Tax  treatment  of  foreign  income 

Changing  economic  conditions  at  home  and  abroad,  the  desire  to  achieve  greater 
equity  in  taxation,  and  the  strains  which  have  developed  in  our  balance-of- 
payments  position  in  the  last  few  years,  compel  us  to  examine  critically  certain 
features  of  our  tax  system  which,  in  conjunction  with  the  tax  system  of  other 
countries,  consistently  favor  U.S.  private  investment  abroad  compared  with  in- 
vestment in  our  own  economy. 

1.  Elimination  of  tax  deferral  privileges  in  developed  countries  and  "tax  haven" 
deferral  privileges  in  all  countries. — Profits  earned  abroad  by  American  firms 
operating  through  foreign  subsidiaries  are,  under  present  tax  laws,  subject  to  U.S. 
tax  only  when  they  are  returned  to  the  parent  company  in  the  form  of  dividends. 
In  some  cases,  this  tax  deferral  has  made  possible  indefinite  postponement  of  the 
U.S.  tax;  and,  in  those  countries  where  income  taxes  are  lower  than  in  the  United 
States,  the  ability  to  defer  the  payment  of  U.S.  tax  by  retaining  income  in  the  sub- 
sidiary companies  provides  a  tax  advantage  for  companies  operating  through  over- 
sea subsidiaries  that  is  not  available  to  companies  operating  solely  in  the  United 
States.  Many  American  investors  properly  made  use  of  this  deferral  in  the  con- 
duct of  their  foreign  investment.  Though  changing  conditions  now  make  con- 
tinuance of  the  privilege  undesirable,  such  change  of  policy  implies  no  criticism 
of  the  investors  who  so  utilize  this  privilege. 

The  undesirability  of  continuing  deferral  is  underscored  where  deferral  has 
served  as  a  shelter  for  tax  escape  through  the  unjustifiable  use  of  tax  havens  such 
as  Switzerland.  Recently  more  and  more  enterprises  organized  abroad  by 
American  firms  have  arranged  their  corporate  structures — aided  by  artificial 
arrangements  between  parent  and  subsidiary  regarding  intercompany  pricing,  the 
transfer  of  patent  licensing  rights,  the  shifting  of  management  fees,  and  similar 
practices  which  maximize  the  accumulation  of  profits  in  the  tax  haven — so  as  to 
exploit  the  multiplicity  of  foreign  tax  systems  and  international  agreements  in 
order  to  reduce  sharply  or  eliminate  completely  their  tax  liabilities  both  at  home 
and  abroad. 

To  the  extent  that  these  tax  havens  and  other  tax  deferral  privileges  result  in 
U.S.  firms  investing  or  locating  abroad  largely  for  tax  reasons,  the  etficient  allo- 
cation of  international  resources  is  upset,  the  initial  drain  on  our  already  adverse 


I 


EXHIBITS  307 

balance  of  payments  is  never  fully  compensated,  and  profits  are  retained  and  re- 
invested abroad  which  would  otherwise  be  invested  in  the  United  States.  Cer- 
tainly since  the  postwar  reconstruction  of  Europe  and  Japan  has  been  completed, 
there  are  no  longer  foreign  policy  reasons  for  providing  tax  incentives  for  foreign 
investment  in  the  economically  advanced  countries. 

If  we  are  seeking  to  curb  tax  havens,  if  we  recognize  that  the  stimulus  of  tax 
deferral  is  no  longer  needed  for  investment  in  the  developed  countries,  and  if  we 
are  to  emphasize  investment  in  this  country  in  order  to  stimulate  our  economy 
and  our  plant  modernization,  as  well  as  ease  our  balance-of-payments  deficit, 
we  can  no  longer  afford  existing  tax  treatment  of  foreign  income. 

I  therefore  recommend  that  legislation  be  adopted  which  would,  after  a  two- 
step  transitional  period,  tax  each  year  American  corporations  on  their  current 
share  of  the  undistributed  profits  realized  in  that  year  by  subsidiary  corporations 
organized  in  economicallj^  advanced  countries.  This  current  taxation  would  also 
apply  to  individual  shareholders  of  closely  held  corporations  in  those  countries. 
Since  income  taxes  paid  abroad  are  properly  a  credit  against  the  U.S.  income 
tax,  this  would  subject  the  income  from  such  business  activities  to  essentially 
the  same  tax  rates  as  business  activities  conducted  in  the  United  States.  To 
permit  firms  to  adjust  their  operations  to  this  change,  I  also  recommend  that 
this  result  be  achieved  in  equal  steps  over  a  2-year  period,  under  which  only  one- 
half  of  the  profits  would  be  affected  during  1962.  Where  the  foreign  taxes  paid 
have  been  close  to  the  U.S.  rates,  the  impact  of  this  change  would  be  small. 

This  proposal  will  maintain  U.S.  investment  in  the  developed  countries  at  the 
level  justified  by  market  forces.  American  enterprise  abroad  will  continue  to 
compete  with  foreign  firms.  With  their  access  to  capital  markets  at  home  and 
abroad,  their  advanced  technical  know-how,  their  energy,  resourcefulness,  and 
many  other  advantages,  American  firms  will  continue  to  occupy  their  rightful 
place  in  the  markets  of  the  world.  While  the  rate  of  expansion  of  some  American 
business  operations  abroad  may  be  reduced  through  the  withdrawal  of  tax  deferral 
such  reduction  would  be  consistent  with  the  efficient  distribution  of  capital  re- 
sources in  the  world,  our  balance-of-payments  needs,  and  fairness  to  competing 
firms  located  in  our  own  country. 

At  the  same  time,  I  recommend  that  tax  deferral  be  continued  for  income  from 
investment  in  the  developing  economies.  The  free  world  has  a  strong  obligation 
to  assist  in  the  development  of  these  economies,  and  private  investment  has  an 
important  contribution  to  make.  Continued  income  tax  deferral  for  these  areas 
will  be  helpful  in  this  respect.  In  addition,  the  proposed  elimination  of  income 
tax  deferral  on  U.S.  earnings  in  industrialized  countries  should  enhance  the  rela- 
tive attraction  of  investment  in  the  less-developed  countries. 

On  the  other  hand,  I  recommend  elimination  of  the  tax  haven  device  anywhere 
in  the  world,  even  in  the  underdeveloped  countries,  through  the  elimination  of 
tax  deferral  privileges  for  those  forms  of  activities,  such  as  trading,  licensing, 
insurance,  and  others,  that  typically  seek  out  tax  haven  methods  of  operation. 
There  is  no  valid  reason  to  permit  their  remaining  untaxed  regardless  of  the 
country  in  which  they  are  located. 

2.  Taxation  of  foreign  investment  companies. — -For  some  years  now  we  have  wit- 
nessed substantial  outflows  of  capital  from  the  United  States  into  investment 
companies  created  abroad  whose  principal  justification  lies  in  the  tax  benefits 
which  their  method  of  operation  produces.  I  recommend  that  these  tax  benefits 
be  removed  and  that  income  derived  through  such  foreign  investment  companies 
be  treated  in  substantially  the  same  way  as  income  from  domestic  investment 
companies. 

3.  Taxation  of  American  citizens  abroad. — It  is  no  more  justifiable  to  provide 
tax  exemptions  for  individuals  living  in  the  developed  countries  than  it  is  to  pro- 
vide tax  inducements  for  capital  investment  there.  Nor  should  we  permit  totally 
unjustified  tax  benefits  to  be  obtained  by  those  Americans  whose  choice  of  resi- 
dence is  dictated  primarily  by  their  desire  to  minimize  taxes. 

I,  therefore,  recommend — 

That  the  total  tax  exemption  now  accorded  the  earned  income  of  Ameri- 
can citizens  residing  abroad  be  completely  terminated  for  those  residing 
in  economically  advanced  countries; 

That  this  exemption  for  earned  income  be  limited  to  $20,000  for  those 
residing  in  the  less-developed  countries;  and 

That  the'  exemption  of  $20,000  of  earned  income  now  accorded  those 
citizens  who  stay  (but  do  not  reside)  abroad  for  17  out  of  18  months  also 


308   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

be  completely  terminated  for  those  living  or  traveling  in  the  economically 
advanced  countries. 

4.  Estate  tax  on  property  located  abroad. — I  recommend  that  the  exclusion  from 
the  estate  tax  accorded  real  property  situated  abroad  be  terminated.  With  the 
adoption  several  years  ago  of  the  credit  for  foreign  taxes  under  the  estate  tax, 
there  is  no  justification  for  the  continued  exemption  of  such  property. 

5.  Allowance  for  foreign  tax  on  dividends. — Finally,  the  method  by  which  the 
credit  for  foreign  income  taxes  is  computed  in  the  case  of  dividends  involves  a 
double  allowance  for  foreign  income  taxes  and  should  be  corrected. 

These  proposals,  along  with  more  detailed  and  technical  changes  needed  to 
improve  the  taxation  of  foreign  income,  are  expected  to  reduce  substantially  our 
balance-of-payments  deficit  and  to  increase  revenues  by  at  least  $250  million 
per  year. 

IV.  Correction  of  other  structural  defects 

I  next  recommend  a  number  of  measures  to  remove  other  serious  defects  in  the 
income  tax  structure.  These  changes,  while  making  a  beginning  toward  the  com- 
prehensive tax  reform  program  mentioned  above,  will  provide  sufficient  revenue 
gains  to  offset  the  cost  of  the  investment  tax  credit  and  keep  the  revenue-producing 
potential  of  our  tax  structure  intact. 

1.  Withholding  on  interest  and  dividends. — Our  system  of  combined  withholding 
and  voluntary  reporting  on  wages  and  salaries  under  the  individual  income  tax 
has  served  us  well.  Introduced  during  the  war  when  the  income  tax  was  extended 
to  millions  of  new  taxpayers,  the  wage-withholding  system  has  been  one  of  the 
most  important  and  successful  advances  in  our  tax  system  in  recent  times.  Initial 
difficulties  were  quickly  overcome,  and  the  new  system  helped  the  taxpayer  no 
less  than  the  tax  collector. 

It  is  the  more  unfortunate,  therefore,  that  the  application  of  the  withholding 
principle  has  remained  incomplete.  Withholding  does  not  apply  to  dividends 
and  interest,  with  the  result  that  substantial  amounts  of  such  income,  particularly 
interest,  improperly  escape  taxation.  It  is  estimated  that  about  $3  billion  of 
taxable  interest  and  dividends  are  unreported  each  year.  This  is  patently  unfair 
to  those  who  must  as  a  result  bear  a  larger  share  of  the  tax  burden.  Recipients 
of  dividends  and  interest  should  pay  their  tax  no  less  than  those  who  receive 
wage  and  salary  income,  and  the  tax  should  be  paid  just  as  promptly.  Large 
continued  avoidance  of  tax  on  the  part  of  some  has  a  steadily  demoralizing  effect 
on  the  compliance  of  others. 

This  gap  in  reporting  has  not  been  appreciably  lessened  by  educational  pro- 
grams. Nor  can  it  be  effectively  closed  by  intensified  enforcement  measures, 
except  by  the  expenditure  of  inordinate  amounts  of  time  and  money.  With- 
holding on  corporate  dividends  and  on  investment-type  interest,  such  as  interest 
paid  on  taxable  Government  and  corporate  securities  and  savings  accounts,  is 
both  necessary  and  practicable. 

1,  therefore,  recommend  the  enactment  of  legislation  to  provide  for  a  20  percent 
withholding  rate  on  corporate  dividends  and  taxable  investment-type  interest, 
effective  January  1,  1962,  under  a  system  which  would  not  require  the  preparation 
of  withholding  statements  to  be  sent  to  recipients.  It  would  thus  place  a  rela- 
tively light  burden  of  compliance  on  the  payers  of  interest  and  dividends — 
certainly  less  than  that  placed  on  payers  of  wages  and  salaries — while  at  the 
same  time  largely  solving  the  compUance  problem  for  most  of  the  taxpayers 
receiving  dividends  and  interest.  Steps  will  also  be  taken  to  avoid  hardships 
for  recipients  who  are  not  subject  to  tax. 

The  remaining  need  for  compliance,  largely  in  the  high  income  group  subject 
to  a  higher  tax  rate,  would  be  met  through  the  concentration  of  enforcement 
devices  on  taxpayers  in  these  brackets.  Introduction  of  equipment  for  the  auto- 
matic processing  of  information  returns  would  be  especially  helpful  for  this  pur- 
pose and  would  thus  supplement  the  extension  of  withholding. 

Enactment  of  this  proposal  is  estimated  to  increase  revenue  by  $600  million 
per  year. 

2.  Repeal  of  the  dividend  credit  and  exclusion. — The  present  law  provides  for 
an  exclusion  from  income  of  the  first  $50  of  dividends  received  from  domestic 
corporations,  and  for  a  4  percent  credit  against  tax  of  such  dividend  income  in 
excess  of  $50.  These  provisions  were  enacted  in  1954.  Proponents  argued  that 
they  would  encourage  capital  formation  through  equity  investment,  and  that 
they  would  provide  a  partial  offset  to  the  so-called  double  taxation  of  dividend 


EXHIBITS  309 

income.     It  is  now  clear  that  they  serve  neither  purpose  well;  and  I,  therefore, 
recommend  the  repeal  of  both  the  dividend  credit  and  exclusion. 

The  dividend  credit  and  exclusion  are  not  an  efficient  stimulus  to  capital 
expansion  in  the  form  of  plant  and  equipment.  The  revenue  losses  resulting  from 
these  provisions  are  spread  over  a  large  volume  of  outstanding  shares  rather 
than  being  concentrated  on  new  shares;  and  the  stimulating  effect  of  the  provisions 
are  thus  greatly  diluted,  resulting  in  relatively  little  increases  in  the  supply  of 
equity  funds  and  a  relatively  slight  reduction  in  the  cost  of  equity  financing. 
In  fact,  such  reduction  as  does  occur  is  more  likely  to  benefit  large  corporations 
with  easy  access  to  the  capital  market,  while  being  of  little  use  to  small  firms 
which  are  not  so  favorably  situated.  Insofar  as  raising  the  profitability  of  new 
investment  in  plant  and  equipment  is  concerned,  the  tax  investment  credit  pro- 
posed above  would  be  far  more  eflfective  since  it  is  offered  to  the  corporation, 
where  the  actual  investment  decision  is  made. 

The  dividend  credit  and  exclusion  are  equally  inadequate  as  a  solution  to 
the  so-called  problem  of  double  taxation.  Whatever  may  be  the  merits  of  the 
arguments  respecting  the  existence  of  double  taxation,  the  provisions  of  the  1954 
act  clearly  do  not  offer  an  appropriate  remedy.  They  greatly  overcompensate 
the  dividend  recipient  in  the  high  income  bracket,  while  giving  either  insufficient 
or  no  relief  to  shareholders  with  smaller  income. 

This  point  deserves  emphasis.  For  viewed  simply  as  a  means  of  tax  reduction, 
the  dividend  credit  is  wholly  inequitable.  The  distribution  of  its  benefits  is 
highly  favorable  to  the  taxpayers  in  the  upper  income  groups  who  receive  the 
major  part  of  dividend  income.  Only  about  10  percent  of  dividend  income 
accrues  to  those  with  incomes  below  $5,000;  about  80  percent  of  it  accrues  to  that 
6.5  percent  of  taxpayers  whose  incomes  exceed  $10,000  a  year.  Similarly, 
dividend  income  is  a  sharply  rising  fraction  of  total  income  as  we  move  up  the 
income  scale.  Thus,  dividend  income  is  about  1  percent  of  all  income  from  all 
sources  for  those  taxpayers  with  incomes  of  $3,000  to  $5,000;  but  it  constitutes 
more  than  25  percent  of  the  income  for  those  with  $100,000  to  $150,000  of  income, 
and  about  50  percent  for  those  with  incomes  over  $1  million. 

The  role  of  the  dividend  credit  should  not  be  confused  with  the  broader  question 
of  tax  rates  appUcable  to  high  incomes.  These  high  rates  deserve  reexamination; 
and  this  is  one  of  the  problems  which  will  be  examined  in  the  context  of  next 
year's  tax  reform.  But  if  top  bracket  rates  were  to  be  reduced,  the  dividend  credit 
is  not  the  way  to  do  it.  Rate  reductions,  if  appropriate,  should  apply  no  less 
to  those  with  high  incomes  from  other  sources,  such  as  professional  and  salaried 
people  whose  tax  position  is  particularly  diflRcult  today. 

If  the  credit  is  eliminated,  the  $50  exclusion  should  also  be  discarded  for  similar 
reasons.  The  tax  saving  from  the  exclusion  is  substantially  greater  for  a  dividend 
recipient  with  a  high  income  than  for  a  recipient  with  low  income.  Moreover, 
on  equity  grounds,  there  is  no  reason  for  giving  tax  reduction  to  that  small  frac- 
tion of  low-income  taxpayers  who  receive  dividends  in  contrast  to  those  who  must 
live  on  wages,  interest,  rents,  or  other  forms  of  income. 

The  1954  formula  therefore  is  a  dead  end  and  should  be  rescinded,  effective 
December  31  of  this  year.     The  estimated  revenue  gain  is  $450  million  per  year. 

3.  Expense  accozints.- — In  recent  years  widespread  abuses  have  developed 
through  the  use  of  the  expense  account.  Too  many  firms  and  individuals  have 
devised  means  of  deducting  too  many  personal  living  expenses  as  business  expenses, 
thereby  charging  a  large  part  of  their  cost  to  the  Federal  Government.  Indeed, 
expense  account  Hving  has  become  a  byword  in  the  American  scene. 

This  is  a  matter  of  national  concern,  affecting  not  only  our  public  revenues, 
our  sense  of  fairness,  and  our  respect  for  the  tax  system,  but  our  moral  and  busi- 
ness practices  as  well.  This  widespread  distortion  of  our  business  and  social 
structure  is  largely  a  creature  of  the  tax  system,  and  the  time  has  come  when  our 
tax  laws  should  cease  their  encouragement  of  luxury  spending  as  a  charge  on 
the  Federal  Treasury.  The  slogan — "It's  deductible"^ — should  pass  from  our 
scene. 

Tighter  enforcement  of  present  legislation  will  not  suffice.  Even  though  in 
some  instances  entertainment  and  related  expenses  have  an  association  with  the 
needs  of  business,  they  nevertheless  confer  substantial  tax-free  personal  benefits 
to  the  recipients.  In  other  cases,  deductions  are  obtained  by  disguising  personal 
expenses  as  business  outlays.  But  under  present  law,  it  is  extremely  difficult  to 
separate  out  and  disallow  such  pseudo-business  expenditures.  New  legislation  is 
needed  to  deal  with  the  problem. 


310    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

I,  therefore,  recommend  that  the  cost  of  such  business  entertainment  and  the 
maintenance  of  entertainment  facilities  (such  as  j'achts  and  hunting  lodges) 
be  disallowed  in  full  as  a  tax  deduction  and  that  restrictions  be  imposed  on  the 
deductibility  of  business  gifts,  expenses  of  business  trips  combined  with  vacations, 
and  excessive  personal  living  expenses  incurred  on  business  travel  away  from  home. 

I  feel  confident  that  these  measures  will  be  welcomed  by  the  American  people. 
I  am  also  confident  that  business  firms,  now  forced  to  emulate  the  expense  account 
favors  of  their  competitors,  however  unsound  or  uneconomical  such  practices  may 
be,  will  welcome  the  removal  of  this  pressure.  These  measures  will  strengthen 
both  our  tax  structure  and  the  moral  fiber  of  our  society.  These  provisions 
should  be  effective  as  of  January  1,  1962,  and  are  estimated  to  increase  Treasury 
receipts  by  at  least  $250  million  per  year. 

4.  Capital  gains  on  sale  of  depreciable  business  property. — Another  flaw  which 
should  be  corrected  at  this  time  relates  to  the  taxation  of  gains  on  the  sale  of 
depreciable  business  property.  Such  gains  are  now  taxed  at  the  preferentiaLrate 
applicable  to  capital  gains,  even  though  they  represent  ordinary  income. 

This  situation  arises  because  the  statutory  rate  of  depreciation  mav  not  coincide 
with  the  actual  decline  in  the  value  of  the  asset.  While  the  taxpayer  holds  the 
property,  depreciation  is  taken  as  a  deduction  from  ordinary  income.  Upon  its 
resale,  where  the  amount  of  depreciation  allowable  exceeds  the  decline  in  the 
actual  value  of  the  asset  so  that  a  gain  occurs,  this  gain  under  present  law  is  taxed 
at  the  preferential  capital  gains  rate.  The  advantages  resulting  from  this  practice 
have  been  increased  by  the  liberalization  of  depreciation  rates. 

Our  capital  gains  concept  should  not  encompass  this  kind  of  income.  This 
inequity  should  be  eliminated,  and  especially  so  in  view  of  the  proposed  investment 
credit.  We  should  not  encourage  through  tax  incentives  the  further  acquisition 
of  such  property  as  long  as  this  loophole  remains. 

I,  therefore,  recommend  that  capital  gains  treatment  be  withdrawn  from  gains 
on  the  disposition  of  depreciable  property,  both  personal  and  real  property,  to 
the  extent  that  depreciation  has  been  deducted  for  such  property  by  the  seller  in 
previous  years,  permitting  only  the  excess  of  the  sales  price  over  the  original  cost 
to  be  treated  as  a  capital  gain.  The  remainder  should  be  treated  as  ordinary 
income.  This  reform  should  immediately  become  effective  as  to  all  sales  taking 
place  after  the  date  of  enactment.  It  is  estimated  to  raise  revenue  by  $200  million 
annually. 

5.  Cooperatives  and  financial  institutions. — Another  area  of  the  tax  laws  which 
calls  for  attention  is  the  treatment  of  cooperatives,  private  lending  institutions, 
and  fire  and  casualty  insurance  companies. 

Contrary  to  the  intention  of  Congress,  substantial  income  from  certain  coopera- 
tive enterprises,  reflecting  business  operations,  is  not  being  taxed  either  to  the 
cooperative  organization  itself  or  its  members.  This  situation  must  be  corrected 
in  a  manner  that  is  fair  and  just  to  both  the  cooperatives  and  competing  businesses. 

The  present  inequity  has  resulted  from  court  decisions  which  held  patronage 
refunds  in  certain  forms  to  be  nontaxable.  I  recommend  that  the  law  be  clarified 
so  that  all  earnings  are  taxable  to  either  the  cooperatives  or  to  their  patrons, 
assessing  the  patron  on  the  earnings  that  are  allocated  to  him  as  patronage 
dividends  or  refunds  in  scrip  or  cash.  The  withholding  principle  recommended 
above  should  also  be  applied  to  patronage  dividends  or  refunds  so  that  the  average 
patron  receiving  scrip  will,  in  effect,  be  given  the  cash  to  pay  his  tax  on  his  patron- 
age dividend  or  refund.  The  cooperatives  should  not  be  penalized  by  the  assess- 
ment of  a  patronage  tax  upon  dividends  or  refunds  taxable  to  the  patron  but  left 
in  the  business  as  a  substitute  for  the  sale  of  securities  to  obtain  additional  equity 
capital.  The  exemption  for  rural  electric  cooperatives  and  credit  unions  should 
be  continued. 

The  tax  provisions  applicable  to  fire  and  casualty  insurance  companies,  origi- 
nally adopted  in  1942,  need  to  be  reviewed  in  the  light  of  current  conditions.  Many 
of  these  companies,  organized  on  the  mutual  or  reciprocal  basis  are  now  taxed 
under  a  special  formula  which  does  not  take  account  of  their  underwritings  gains 
and  thus  results  in  an  inequitable  distribution  of  the  tax  burden  amoung  various 
types  of  companies.  Consideration  should  be  given  to  taxing  mutual  or  reciprocal 
companies  on  a  basis  similar  to  stock  companies,  following  the  pattern  of  similar 
treatment  of  stock  and  mutual  enterprise  in  the  life  insurance  field. 

Some  of  the  most  important  types  of  private  savings  and  lending  institutions 
in  the  country  are  accorded  tax  deductible  reserve  provisions  which  substantially 
reduce  or  eliminate  their  Federal  income  tax  liability.  These  provisions  should 
be  reviewed  with  the  aim  of  assuring  nondiscriminatory  treatment. 


EXHIBITS  311 

Remedial  legislation  in  these  fields  would  enlarge  the  revenues  and  contribute 
to  a  fair  and  sound  tax  structure. 

V.  Tax  administration 

One  of  the  major  characteristics  of  our  tax  system,  and  one  in  which  we  can 
take  a  great  deal  of  pride,  is  that  it  operates  primarily  through  individual  self- 
assessment.  The  integrity  of  such  a  system  depends  upon  the  continued  wilHng- 
ness  of  the  people  honestly  and  accurately  to  discharge  this  annual  price  of 
citizenship.  To  the  extent  that  some  people  are  dishonest  or  careless  in  their 
dealings  with  the  Government,  the  majority  is  forced  to  carry  a  heavier  tax 
burden. 

For  voluntary  self-assessment  to  be  both  meaningful  and  productive  of  revenues, 
the  citizens  must  not  only  have  confidence  in  the  fairness  of  the  tax  laws,  but  also 
in  their  uniform  and  vigorous  enforcement  of  these  laws.  If  noncompliance  by 
the  few  continues  unchecked,  the  confidence  of  the  many  in  our  self-assessment 
system  will  be  shaken  and  one  of  the  cornerstones  of  our  Government  weakened. 

I  have  in  this  message  already  recommended  the  application  of  withholding  to 
dividends  and  interest  and  revisions  to  halt  the  abuses  of  expense  accounts.  These 
measures  will  improve  taxpayer  compliance  and  raise  the  regard  of  taxpayers  for 
the  fairness  of  our  system.  In  addition,  I  propose  three  further  measures  to 
improve  the  tax  enforcement  machinery. 

1.  Taxpayer  account  numbers. — The  Internal  Revenue  Service  has  begun  the 
installation  of  automatic  data  processing  equipment  to  improve  administration  of 
the  growing  job  of  tax  collection  and  enforcement.  A  system  of  identifying 
taxpayer  account  numbers,  which  would  make  possible  the  bringing  together  of 
all  tax  data  for  any  one  particular  taxpayer,  is  an  essential  part  of  such  an  improved 
collection  and  enforcement  program. 

For  this  purpose,  social  security  numbers  would  be  used  by  taxpayers  already 
having  them.  The  small  minority  currently  without  such  numbers  would  be 
assigned  numbers  which  these  persons  could  later  use  as  well  for  social  security 
purposes  if  needed.  The  numbers  would  be  entered  on  tax  returns,  information 
returns,  and  related  documents. 

I  recommend  that  legislation  be  enacted  to  authorize  the  use  of  taxpayer  account 
numbers  beginning  January  1,  1962,  to  identify  taxpayer  accounts  throughout  the 
processing  and  recordkeeping  operations  of  the  Internal  Revenue  Service. 

2.  Increased  audit  coverage. — The  examination  of  tax  returns  is  the  essence  of 
the  enforcement  process.  The  number  of  examining  personnel  of  the  Internal 
Revenue  Service,  however,  has  been  consistently  inadequate  to  cope  with  the  audit 
workload.  Consequently,  it  has  been  unable  to  audit  carefully  many  of  the  returns 
which  should  be  so  examined.  Anticipated  growth  in  our  population  will,  of 
course,  increase  this  enforcement  problem. 

Related  to  broadened  tax  audit  is  the  criminal  enforcement  program  of  the 
Revenue  Service.  Here,  the  guiding  principle  is  the  creation  of  a  deterrent  to 
tax  evasion  and  to  maintain  or,  if  possible,  increase  voluntary  compliance  with  all 
taxing  statutes.  This  means  placing  an  appropriate  degree  of  investigative 
emphasis  on  all  types  of  tax  violations,  in  all  geographical  areas,  and  identifying 
violations  of  substance  in  all  income  brackets  regardless  of  occupation,  business, 
or  profession. 

Within  this  framework  of  a  balanced  enforcement  effort,  the  Service  is  placing 
special  investigative  emphasis  on  returns  filed  by  persons  receiving  income  from 
illegal  sources.  I  have  directed  all  Federal  law  enforcement  agencies  to  cooperate 
fully  with  the  Attorney  General  in  a  drive  against  organized  crime,  and  to  utilize 
their  resources  to  the  maximum  extent  in  conducting  investigations  of  individuals 
engaged  in  criminal  activity  on  a  major  scale.  With  the  foregoing  in  mind,  I 
have  directed  the  Secretary  of  the  Treasury  to  provide  through  the  Internal 
Revenue  Service  a  maximum  effort  in  this  field. 

To  fulfill  these  requirements  for  improved  audits,  enforcement,  and  anticrime 
investigation,  it  is  essential  that  the  Service  be  provided  additional  resources 
which  will  pay  their  own  cost  many  times  over.  In  furthering  the  Service's  long- 
range  plans,  the  prior  administration  asked  additional  appropriation  of  $27!4 
million  to  hire  about  3,500  additional  personnel  during  fiscal  1962,  including 
provisions  for  the  necessary  increases  in  space  and  modern  equipment,  vital  to  the 
efficient  operation  of  the  Service.  To  meet  the  commitments  described  above 
this  administration  reviewed  these  proposals  and  recommended  that  they  be 
increased  by  another  $7  million  and  765  additional  personnel  to  expedite  the 
expansion  and  criminal  enforcement  programs.     The  pending  alternative  of  only 


312   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

1,995  additional  personnel,  or  less  than  one-half  of  the  number  requested,  this 
administration  would  consider  little  more  than  the  additional  employees 
needed  each  year  during  the  1960's  just  to  keep  up  with  the  estimated  growth  in 
number  and  complexity  of  returns  filed.  Thus  I  must  again  strongly  urge  the 
Congress  to  give  its  full  support  to  my  original  request.  These  increases  will 
safeguard  the  long-term  adequacy  of  the  Nation's  traditional  voluntary  compliance 
system  and,  at  the  same  time,  return  the  added  appropriations  several  times  over 
in  added  revenue. 

3.  Inventory  reporting. — It  is  increasingly  apparent  that  the  manipulation  of 
inventories  has  become  a  frequent  method  of  avoiding  taxes.  Current  laws  and 
regulations  generally  permit  the  use  of  inventory  methods  which  are  acceptable  in 
recognized  accounting  practice.  Deviations  from  these  methods,  which  are  not 
always  easy  to  detect  during  examination  of  tax  returns,  can  often  lead  to  com- 
plete nonpayment  of  taxes  until  the  inventories  are  liquidated;  and,  for  some  tax- 
payers, this  represents  permanent  tax  reduction.  The  understating  of  the  valua- 
tion of  inventories  is  the  device  most  frequently  used. 

I  have  directed  the  Internal  Revenue  Service  to  give  increasing  attention  to  this 
area  of  tax  avoidance,  through  a  stepped-up  emphasis  on  both  the  verification  of 
the  amounts  reported  as  inventories  and  an  examination  of  methods  used  in 
arriving  at  their  reported  valuation. 

VI.  Tax  rate  extension 

As  recommended  by  my  predecessor,  it  is  again  necessary  that  Congress  enact 
an  extension  of  present  corporation  income  and  excise  tax  rates  otherwise  scheduled 
for  reduction  or  termination  on  July  1,  1961.  Such  extension  has  been  adopted 
by  the  Congress  on  a  number  of  previous  occasions,  and  our  present  revenue 
requirements  make  such  extension  absolutely  necessary  again  this  year. 

In  the  absence  of  such  legislation,  the  corporate  tax  rate  would  be  decreased  5 
percentage  points,  from  52  percent  to  47  percent,  excise  tax  rates  on  distilled 
spirits,  beer,  wines,  cigarettes,  passenger  automobiles,  automobile  parts  and  acces- 
sories, and  the  transportation  of  persons  would  also  decline;  and  the  excise  tax  on 
general  telephone  service  would  expire.  We  cannot  afford  the  loss  of  these  revenues 
at  this  time. 

VII.  Aviation  fuel 

The  last  item  on  the  agenda  relates  to  aviation  fuel.  The  two  previous  adminis- 
trations have  urged  that  civil  aviation,  a  mature  and  growing  industry,  be  re- 
quired to  pay  a  fair  share  of  the  costs  of  operating  and  improving  the  Federal 
airways  system.  The  rapidly  mounting  costs  of  these  essential  services  to  air 
transportation  makes  the  imposition  of  user  charges  more  imperative  now  than 
ever  before.  The  most  efficient  method  for  recovering  a  portion  of  these  costs 
equitably  from  the  airway  users  is  through  a  tax  on  aviation  fuel.  Present  law 
provides  for  a  net  tax  of  2  cents  a  gallon  on  aviation  gasoline  but  no  tax  on  jet 
fuel.  The  freedom  from  tax  on  jet  fuel  is  inequitable  and  is  resulting  in  substantial 
revenue  losses  due  to  the  transition  to  jet  power  and  the  resulting  decline 
in  gasoline  consumption. 

My  predecessor  recommended  a  flat  4>^-cent  tax  for  both  aviation  gasoline  and 
jet  fuels.    Such  a  request,  however,  appears  to  be  unreahstic  in  view  of  the  current 
financial  condition  of  the  airline  industry. 
Therefore,  I  recommend — 

Extending  the  present  net  2-cent  rate  on  aviation  gasoline  to  jet  fuels; 
Holding  this  uniform  rate  covering  both  types  of  fuel  at  the  2-cent  level 
for  fiscal  1962;  and 

Providing  for  annual  increments  in  this  rate  of  one-half  cent  after  fiscal 
year  1962  until  the  portion  of  the  cost  of  the  airways  properly  allocable  to 
civil  aviation  is  substantially  recovered  by  this  tax. 
The  immediate  increase  in  revenue  from  this  proposal  is  modest  in  comparison 
with  anticipated  airways  costs;  and  the  annual  gradation  of  further  increases  is 
intended  to  moderate  the  impact  of  the  tax  on  the  air  carrier  industry.     Should 
future  economic  or  other  developments  warrant,  a  more  rapid  increase  in  the  fuel 
tax  will  be  recommended.    The  decline  from  the  revenues  estimated  by  my  prede- 
cessor is  not  large,  and  will  be  met  by  the  reforms  previously  proposed.     I  repeat 
my  earlier  recommendation  that,  consistent  with  the  user  charge  principle,  reve- 


EXHIBITS  313 

nues  from  the  aviation  fuels  tax  be  retained  in  the  general  fund  rather  than 
diverted  to  the  highway  trust  fund. 

Conclusion 

The  legislation  recommended  in  this  message  offers  a  first  step  toward  the 
broader  objective  of  tax  reform.  The  immediate  need  is  for  encouraging  eco- 
nomic growth  through  modernization  and  capital  expansion,  and  to  remove  tax 
preferences  for  foreign  investment  which  are  no  longer  needed  and  which  impair 
our  balance-of-payments  position.  A  beginning  is  made  also  toward  removing 
some  of  the  more  glaring  defects  in  the  tax  structure.  The  revenue  gain  in  these 
proposals  will  offset  the  revenue  cost  of  the  investment  credit.  Finally,  certain 
rate  extensions  are  needed  to  maintain  the  revenue  potential  of  our  fiscal  system. 

These  items  need  to  be  done  now;  but  they  are  a  first  step  only.  They  will  be 
followed  next  year  by  a  second  set  of  proposals,  aimed  at  thorough  income  tax  re- 
form. Their  purpose  will  be  to  broaden  and  unify  the  income  tax  base,  and  to 
review  the  entire  rate  structure  in  the  light  of  these  revisions.  Let  us  join  in  solving 
these  immediate  problems  in  the  coming  months,  and  then  join  in  further  action 
to  strengthen  the  foundations  of  our  revenue  system. 

John  F.  Kennedy. 

The  White  House,  April  BO,  1961. 


ExmBiT  13. — Statement  by  Secretary  of  the  Treasury  Dillon,  May  3,  1961,  before 
the  House  Committee  on  Ways  and  Means  on  the  President's  tax  program 

The  central  objectives  of  the  President's  current  tax  program  are: 

First,  to  encourage  modernization  and  expansion  of  American 
industry ; 

Second,  to  remove  tax  advantages  no  longer  justified  that  are  now 
enjoyed  by  some  American  firms  with  investments  overseas; 

Third,  to  correct  certain  evident  flaws  in  our  income  tax  structure; 

Fourth,  to  extend  present  corporation  income  and  excise  tax  rates 
so  as  to  maintain  needed  revenues  during  the  coming  years ;  and 

Fifth,  to  improve  important  aspects  of  tax  administration. 

This  program  will  bring  substantial  gains  to  the  American  economy. 
Its  prompt  enactment  is  urgently  needed  to  stimulate  the  gathering 
forces  of  economic  recovery,  to  create  new  jobs,  to  strengthen  the 
competitive  position  of  American  enterprise,  and  to  reduce  our  balance- 
of-payments  deficit. 

The  program  will  also  take  us  an  important  first  step  toward  our 
longer  run  objectives  of  tax  reform,  which  are  to  adapt  our  tax  system 
to  the  requirements  of  a  dynamically  expanding  economy,  to  provide 
for  a  broader  and  more  uniform  tax  base,  and,  as  a  consequence,  to 
permit  reconsideration  of  the  entire  rate  and  bracket  structure. 

I.  Tax  Incentives  for  Modernization  and  Expansion 

The  President's  message  urges  that  "modernization  and  expansion 
of  the  Nation's  productive  plant  and  equipment  are  essential  to  raise 
productivity,  to  accelerate  economic  growth,  and  to  strengthen  our 
competitive  position  in  world  markets."  For  this  purpose,  he  proposes 
that  an  investment  credit  be  provided  under  the  income  tax.  This 
credit  offers  the  most  powerful  and  efficient  type  of  tax  incentive. 

WHY    WE    NEED    A   TAX    INCENTIVE 

As  we  look  back  over  the  past  century  we  see  that  our  record  of 
economic  growth  has  been  unmatched  anywhere  in  the  world.     But 


314   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

of  late  we  have  fallen  behind.  From  a  historic  growth  rate  of  3 
percent  per  annum  in  gross  national  product  (1909-56,  in  constant 
prices),  we  have  fallen  to  2  percent  in  the  latter  part  of  the  fifties. 
In  the  last  5  years  Western  Europe  has  grown  at  double  or  triple  our 
recent  rate  and  Japan  has  grown  even  faster.  While  there  is  some 
debate  as  to  the  precise  annual  growth  rate  of  the  Soviet  economy, 
CIA  estimates  that  their  GNP  grew  at  a  rate  of  7  percent  in  the  fifties. 
Clearly,  we  must  improve  our  performance;  otherwise,  we  cannot 
maintain  our  national  security,  we  cannot  maintain  our  position  of 
leadership  in  the  eyes  of  the  world  and  we  cannot  achieve  our  national 
aspirations.  The  pressing  task  before  us,  then,  is  to  restore  the  vigor 
of  our  economy  and  to  return  to  our  traditionally  high  rate  of  economic 
expansion  and  growth.  I  am  confident  this  can  be  accomplished. 
But  it  will  require  a  major  effort  by  all  of  us. 

I  have  been  impressed  during  recent  travels  abroad  by  the  great 
progress  our  friends  overseas  have  made  in  reconstructing  their  econ- 
omies since  World  War  II  and  by  the  highly  modern  and  efficient 
plants  they  now  have  at  their  disposal.  We  can  take  justifiable  pride 
in  our  contribution  to  their  recovery,  for  all  of  us  stand  to  gain  from 
economic  progress  anywhere  in  the  free  world.  But  we  must  recog- 
nize that  our  friends  are  once  again  our  vigorous  competitors.  And 
we  cannot  overlook  the  challenge  which  their  competition  represents 
to  our  economy. 

Obviously,  we  cannot  hope  to  meet  this  challenge  with  aging  and 
obsolescent  plant  and  equipment.  The  average  age  of  our  plant 
today  is  24  years.  While  this  is  an  improvement  over  the  immediate 
postwar  years,  our  plant  is  much  older  than  during  the  twenties. 
Much  more  serious  is  the  fact  that  the  average  age  of  our  business 
machinery  and  equipment  has  been  rising  over  the  past  decade.  It 
now  averages  more  than  9  years,  and  from  1954  to  1959,  the  stock  of 
equipment  over  10  years  old  rose  by  50  percent.  While  no  com- 
parable figures  are  available  for  Western  Europe,  all  the  information 
we  do  have  indicates  that  the  plant  and  equipment  of  our  friends  and 
competitors  are  considerably  younger  than  ours. 

Although  this  difference  reflects  the  rebuilding  of  the  shattered 
European  economies,  I  think  it  important  to  emphasize  that  it  was 
due  in  good  part  to  the  vigorous  policies  of  the  European  governments. 
Tax  incentives  for  investment  played  a  significant  role,  including  ac- 
celerated depreciation,  initial  allowances,  and  investment  credits. 
Accelerated  depreciation  now  provides  for  twice  the  straight-line  rate 
under  the  double  declining  balance  method  in  West  German}^  for 
equipment  only  and  in  Canada  for  plant  and  equipment — as  we  also 
do  in  the  United  States  for  both  plant  and  equipment.  It  provides 
for  2K  times  the  straight-line  rate  in  France.  The  United  Kingdom 
permits  special  depreciation  deductions  from  income  of  5  percent  of 
the  cost  of  plant  in  the  first  year,  and  10  percent  in  the  case  of  ma- 
chinery, with  the  balance  depreciated  under  normal  procedures  con- 
currently. Holland  permits  33}^  percent  of  the  cost  of  machinery  to 
be  deducted  over  the  first  4  years  (for  buildings,  5j^  years),  while 
Italy  permits  40  percent  over  the  same  period,  and  in  both  cases  the 
balance  depreciated  concurrently.  The  most  liberal  provisions  are 
found  in  Sweden,  where  the  entire  cost  of  equipment  may  be  \vritten 
off  in  5  years.     Three  Western  European  countries  provide  for  de- 


EXHIBITS  315 

ductions  from  income  of  special  investment  allowances  above  cost, 
which  are  similar  to  the  technique  we  are  now  recommending.  These 
include  a  10  percent  allowance  over  2  years  in  Holland,  an  allowance 
of  10  percent  on  plant  and  20  percent  on  equipment  ia  the  United 
Kingdom,  and  in  Belgium,  a  30  percent  allowance  spread  over  3  years 
on  expenditures  in  excess  of  depreciation  and  proceeds  from  sale  of 
depreciable  assets. 

All  of  our  citizens  will  benefit  from  modernization  of  our  industry. 
A  basic  fact  of  economic  life  is  that  modernization  and  expansion  are 
essential  to  higher  productivity.  Rising  productivity  will  provide  us 
with  a  rising  level  of  per  capita  income,  with  resultant  and  widely 
shared  benefits  in  the  form  of  rising  real  wages  and  rising  investment 
incomes.  Rising  productivity  will  also  permit  us  to  hold  prices  dov^m. 
But  rapid  economic  change  is  not  without  cost.  Progress  alters 
established  modes  of  production  and  creates  hardships  of  transition. 
As  noted  in  the  President's  message,  this  imposes  serious  responsibil- 
ities on  Government  to  facilitate  readjustment  and  spread  these  hard- 
ships equitably. 

A  most  important  contribution  can  be  made  by  maintaining  a  high 
level  of  employment  and  capacity  utilization.  The  fruits  of  moderni- 
zation and  capital  expansion  are  increasingly  realized  as  fuller  use  is 
made  of  all  our  productive  resom-ces.  Moreover,  the  higher  level  of 
capital  formation  which  will  be  induced  by  our  proposed  investment 
credit,  will  generate  added  demand,  which  is  much  needed  at  this 
time  to  raise  our  overall  economic  activity.  The  resultant  increase 
in  jobs  is  estimated  in  the  President's  message  at  about  500,000. 

The  investment  credit  is  needed  this  year  to  stimulate  modernization 
of  our  plant  so  that  we  can  secure  a  higher  rate  of  growth,  create  jobs 
and  stabilize  the  dollar  both  at  home  and  abroad.  There  is  not  a 
moment  to  lose. 

PROPOSED    METHOD    OF    INVESTMENT    STIMULUS 

The  tax  credit  provides  the  most  powerful  stimulant  at  the  lowest 
cost  in  revenues  for  a  given  incentive  effect.  The  investment  credit, 
whQe  new  to  tax  practice  in  the  United  States,  is  not  a  novel  invention 
of  this  admmistration.  As  I  noted  earlier,  similar  approaches  are 
found  in  the  United  Kingdom,  the  Netherlands,  and  Belgium.  The 
proposed  investment  credit  follows  their  general  approach  but  is 
adapted  to  the  needs  of  our  own  economy. 

We  propose,  therefore,  that  the  investor  be  given  a  credit  against 
tax  equal  to  15  percent  of  eligible  investment  expenditures  in  excess 
of  depreciation  allowance;  and  in  addition  that  he  be  given  a  credit  of 
6  percent  of  investment  between  50  and  100  percent  of  depreciation. 
As  a  floor,  in  lieu  of  these  credits,  a  credit  would  be  provided  of  10 
percent  on  the  first  $5,000  of  investment,  regardless  of  whether  it 
was  more  or  less  than  depreciation.  As  an  upper  limit,  the  credit 
would  not  be  allowed  to  exceed  30  percent  of  tax  liability,  but  a  5-year 
carryover  of  unused  tax  credit  would  be  provided.  The  credit  would 
apply  to  investment  expenditures  made  after  January  1  of  this  year 
and  would  be  available  to  individually  owned  firms  as  well  as  to  cor- 
porations. It  would  be  separate  from  and  in  addition  to  subsequent 
depreciation  of  the  asset  under  existing  depreciation  rules. 

614359—62 21 


316    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Let  me  illustrate  the  method  of  computing  the  credit.  Suppose  a 
firm  has  depreciation  deductions  of  $100,000.  If  it  spends  $150,000 
on  new  plant  and  equipment  or  $50,000  in  excess  of  its  depreciation, 
its  credit  would  amount  to  15  percent  on  the  $50,000  excess  or  $7,500 
plus  6  percent  or  $3,000  on  the  $50,000  expenditures  between  50  and 
100  percent  of  depreciation.  This  would  give  it  a  total  credit  of 
$10,500.  If  the  firm  spent  $100,000,  it  would  not  quahfy  for  the  15 
percent  credit,  but  would  receive  the  6  percent  credit  or  $3,000  on 
the  $50,000  expenditures  between  50  and  100  percent  of  depreciation. 
If  the  firm  spent  less  than  $50,000,  it  would  qualify  for  neither  the 
6  percent  nor  the  15  percent  credit,  but  would  have  a  minimum  credit 
of  10  percent  on  the  first  $5,000  of  its  investments. 

The  15  percent  credit  is  very  substantial.  It  is  the  equivalent  of 
a  deduction  of  29  percent  of  the  cost  of  an  asset  for  a  corporation 
subject  to  the  52  percent  tax  rate;  a  deduction  of  50  percent  of  cost 
for  small  corporations  subject  to  the  30  percent  tax  rate;  and  a  deduc- 
tion of  75  percent  for  an  individually  owned  firm  subject  to  the  first 
bracket  rate  imder  the  personal  income  tax.  As  noted  later,  it  is 
largely  because  of  this  advantage  to  the  small  firm  that  we  favor  the 
credit  over  the  deduction  method. 

The  details  of  the  proposed  investment  credit  are  set  forth  in  the 
detailed  explanation  which  has  just  been  submitted  to  you.  As 
shown  there,  appropriate  provisions  for  averaging  would  be  made  to 
avoid  undesirable  bunching  of  investment  and  inequities  between 
firms.  The  method  would  consist  of  carrying  over  as  an  addition  to 
depreciation  in  future  years  the  excess  of  current-year  depreciation 
over  current-year  investment.  This  carryover  would  be  for  a  5-year 
period.  Thus,  firms  would  have  to  offset  current  depreciation  plus 
cumulated  deficiencies  in  investment  over  a  5-year  period  starting 
with  1961. 

In  order  to  obtain  the  maximum  contribution  to  modernization  and 
capital  expansion,  eligible  investment  expenditures  would  be  limited 
to  expenditures  on  new  plant  and  equipment,  and  to  assets  with  a 
Ufe  of  6  years  or  more.  Investment  in  plant  and  equipment  located 
outside  the  United  States  would  be  excluded  as  would  be  investment 
by  public  utilities,  other  than  transportation,  and  investment  in 
residential  construction,  including  hotels  and  apartment  buildings. 
As  stated  in  the  President's  message,  the  credit  should  become  a  useful 
and  continuous  part  of  our  tax  structure.  While  it  would  be  subject 
to  periodic  review,  it  is  not  intended  as  a  temporary  measure.  The 
estimated  revenue  cost  of  the  credit  would  be  $1.7  billion  per  annum. 

ADVANTAGES    OF    INVESTMENT    CREDIT 

As  stated  in  the  President's  message: 

The  proposed  credit  is  designed  to  give  the  greatest  inducement  to  investment 
for  the  revenue  loss  involved. 

The  intent  is  to  stimulate  investment,  not  to  give  general  relief  to 
one  particular  group  of  taxpayers.  For  this  purpose,  the  credit  is 
superior  to  certain  alternative  measures  involving  equal  revenue  loss, 
such  as  a  corresponding  cut  in  the  rate  of  corporation  tax,  or  a  cor- 
responding allowance  for  more  rapid  depreciation  on  new  assets. 


EXHIBITS  317 

The  proposed  credit  is  altogether  superior  to  a  general  cut  in  the 
rate  of  corporation  tax.  The  benefits  from  a  cut  in  the  corporate  rate 
would  be  received  by  all  companies,  whether  they  invested  or  not. 
Our  purpose  is  to  stimulate  new  investment,  not  to  give  general  tax 
reduction.     Therefore,  we  reject  this  approach. 

A  speedup  in  depreciation  on  new  assets,  like  the  investment 
credit,  is  directly  aimed  at  new  investment.  However,  the  invest- 
ment credit  is  a  more  potent  stimulus.  It  goes  markedly  further  in 
increasing  the  rate  of  return  on  new  investment  for  the  same  revenue 
loss.  Where  the  investment  credit  results  in  outright  tax  reduction 
over  and  above  present  depreciation  allowances,  a  speedup  in  depre- 
ciation only  postpones,  for  any  particular  asset,  the  due  date  for  the 
investor's  tax  liabihty  on  the  earnings  from  this  asset.  This  tax 
postponement  raises  the  rate  of  return,  to  be  sure,  but  the  gain  is  very 
much  less  than  under  the  credit.  Consider  a  20-year  asset  which 
yields  10  percent  after  tax  using  straight-line  depreciation  or  about 
11  percent  using  double-declining-balance  depreciation.  The  15  per- 
cent credit  would  raise  its  rate  of  return  to  nearly  14  percent — or  by 
27  percent,  assuming  use  of  the  double-declining-balance  method  of 
depreciation.  The  percentage  gain  in  yield  would  be  even  greater  for 
a  lower  yielding  asset  or  a  shorter  lived  asset.  To  get  approximately 
the  same  effect  for  the  above  20-year  asset,  over  50  percent  of  addi- 
tional depreciation  in  the  first  year  (applied  to  investment  in  excess  of 
depreciation)  would  be  necessary,  and  the  initial  revenue  cost  would 
be  more  than  twice  as  great.  The  revenue  loss  under  the  depreciation 
approach  would  remain  higher,  even  if  the  total  revenue  loss  over  a 
period  of,  say,  10  years  is  considered.  Therefore,  for  any  given  cost 
in  revenue  to  the  Treasury  over  a  substantial  period,  the  increase  in 
rate  of  return,  and  hence  the  stimulus  to  investment,  would  be  much 
greater  under  the  credit  approach. 

This  conclusion  may  seem  surprising.  While  the  credit  clearly 
involves  a  permanent  revenue  loss,  it  is  frequently  said  that  the 
speedup  of  depreciation  involves  no  permanent  revenue  loss  to  the 
Treasury  but  merely  a  tax  postponement.  This  is  true  for  revenues 
from  earnings  on  any  particular  asset,  but  it  is  wrong  with  regard  to 
effects  on  the  Treasury's  total  revenue  over  time.  Assuming  a  con- 
stant stream  of  investment,  the  revenue  loss  from  accelerated  deprecia- 
tion is  also  permanent.  While  the  annual  net  revenue  loss  from  a 
speedup  in  depreciation  declines  as  postponed  taxpajonents  come  due 
in  later  years,  the  earlier  losses  are  never  recouped. 

Since  the  net  revenue  loss  from  accelerated  depreciation  declines 
over  the  years  while  that  from  the  credit  remains  constant  (I  still 
refer  to  the  assumed  case  of  constant  investment),  it  follows  that  the 
advantage  of  the  credit  over  accelerated  depreciation,  given  equal 
revenue  cost,  is  greater  if  a  fairly  short  period  is  considered.  How- 
ever, as  I  have  just  stated,  the  credit  would  still  remain  superior — 
more  effective  in  raising  profitability  for  a  given  revenue  loss — for  a 
period  of  at  least  10  years.  And  if  investment  should  constantly 
grow,  as  is  more  likely  to  be  the  case,  long-run  comparisons  become 
even  more  favorable  to  the  investment  credit  as  the  revenue  cost  of 
accelerated  depreciation  falls  off  more  slowly  with  growing  investment 
than  with  constant  investment. 


318   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Not  only  is  the  investment  credit  superior  in  raising  profitability, 
it  has  other  advantages  as  well.  In  the  first  place,  it  is  a  tax  offset, 
not  a  deduction  from  income.  The  credit  will  not  be  booked  in 
corporate  records  as  a  cost  of  operation  as  would  increased  writeoffs 
under  accelerated  depreciation.  Thus,  the  credit  avoids  distortion 
of  the  costs  on  which  a  firm  bases  its  pricing  and  other  business 
decisions.  Since  one  of  our  major  goals  is  to  hold  the  price  line  so  as 
to  strengthen  the  dollar,  this  advantage  of  the  credit  is  of  very  great 
significance. 

In  the  second  place,  the  investment  credit  does  not  confuse  the 
problem  of  stimulating  investment  with  that  of  properly  defining 
taxable  income.  Depreciation  constitutes  a  major  cost  in  arriving 
at  taxable  income.  The  amount  deducted  depends  on  the  method 
of  depreciation  and  the  depreciable  lives  of  the  assets,  and  both  of 
these  are  subject  to  differences  of  opinion  and  debate.  Some  believe 
that  present  procedures  inevitably  produce  inadequate  amounts  of 
depreciation  by  fading  realistically  to  measure  the  amount  of  asset 
cost  used  up  in  any  current  period.  This  question  is  now  under 
intensive  study  in  the  Treasury  in  connection  with  next  year's  tax 
recommendations,  and  it  is  as  yet  too  early  to  anticipate  what  our 
findings  will  be.  In  any  event,  the  investment  credit  here  proposed 
will  in  no  way  prejudice  the  case  for  such  depreciation  reform  as  may 
prove  to  be  desirable  to  improve  income  measurement. 

INCENTIVE    FOR    ADDITIONAL    INVESTMENT 

I  repeat  that  the  purpose  of  the  investment  credit  is  not  to  provide 
general  tax  reduction  for  recipients  of  profit  income.  Rather,  it  is 
to  stimulate  investment  in  the  most  efficient  manner.  The  credit, 
therefore,  should  be  focused  on  investment  which  would  not  have 
been  undertaken  without  this  inducement,  and  which  will  be  most 
responsive  to  the  stimulus  which  it  provides.  A  higher  credit  on 
such  strategic  investment  will  stimulate  modernization  and  expansion 
more  than  will  a  credit  granted  to  all  new  investment  at  a  lower  rate. 
Holding  the  revenue  cost  constant,  the  proposed  credit  of  6  and  15 
percent  may  be  compared  with  a  credit  to  aU  new  investment  of  7 
percent.  The  proposed  credit  is  superior  because  it  gives  a  greater 
stimulus  to  the  undertaking  of  investment  that  was  not  previously 
planned,  and  is  less  likely  to  give  a  credit  for  investment  that  would 
have  been  undertaken  in  any  event. 

The  strategic  area  for  investment  stimulus  cannot  be  determined 
precisely  investor  by  investor,  and  must  necessarily  be  deHmited  by 
some  general  standard.  In  our  view  it  may  best  be  defined  as  invest- 
ment in  excess  of  depreciation  allowances.  This  threshold  marks  the 
dividing  line  between  a  firm's  traditional  level  of  investment — 
depreciation  being,  after  all,  but  an  indicator  of  the  firm's  average 
level  of  investment  in  the  past — and  a  more  ambitious  policy  of 
modernization  and  expansion.  Also,  it  marks  the  dividing  line  be- 
tween the  level  of  investment  which  can  be  financed  from  deprecia- 


« 


EXHIBITS  319 

tion,  funds  accumulated  free  of  income  tax,  and  that  which  requires 
other  sources  for  finance,  either  external  or  internal. 

This  type  of  credit  would  focus  the  incentive  on  the  most  responsive 
area  of  investment.  At  the  same  time,  it  would  bring  benefits  to  a 
broad  range  of  American  business.  The  Treasury's  recent  deprecia- 
tion survey  indicates  that  nearly  80  percent  of  small  businesses  and 
about  85  percent  of  large  corporations  made  investment  expenditures 
which  averaged  in  excess  of  depreciation  over  the  6-year  period 
1954-59.  In  any  particular  year,  the  fraction  of  qualifying  firms 
would  be  different.  In  the  current  year  1961  it  is  estimated^  that  the 
expenditures  of  94  percent  of  all  business  firms  will  be  substantially 
covered  by  the  minimum  credit.  Of  the  remaining  6  percent  of  firms 
which  account  for  the  greater  part  of  our  national  production  over 
60  percent  are  expected  to  be  eligible  for  the  15  percent  credit  and  an 
additional  25  percent  for  the  6  percent  credit.  Thus  over  85  percent 
of  these  larger  firms  w^ill  benefit  this  year  from  our  proposal. 

While  it  is  desirable  to  have  the  incentive  within  reach  of  a  large 
number  of  firms,  breadth  of  coverage  is  not  the  only  criterion.  The 
purpose,  as  noted  before,  is  not  to  provide  general  tax  reduction  for 
the  recipients  of  profit  income.  The  purpose  is  to  encourage  modern- 
ization and  expansion.  It  is  only  right,  therefore,  that  firms  which 
respond  less  should  benefit  less.  The  greatest  benefit  should  go  to 
the  most  favorable  investment  response. 

The  proposed  stimulus  will  be  of  particular  advantage  to  new  and 
growing  firms  engaged  in  a  high  rate  of  capital  expansion.  It  will 
also  be  of  particular  advantage  to  small  firms  whose  investment  is 
largely  covered  by  the  10  percent  credit.  Moreover,  small  firms  will 
benefit  from  the  proposal  to  express  the  investment  allowance  as  a 
credit  against  tax,  rather  than  as  a  deduction  from  taxable  income. 
Under  the  credit  approach  the  tax  saving  per  dollar  of  eligible  invest- 
ment is  the  same  for  small  and  large  firms.  Under  a  deduction  ap- 
proach the  tax  reduction  would  be  greater  for  large  firms  which  are 
subject  to  a  higher  rate  of  tax. 

RELATION   TO    NEXT   YEAR's   TAX    REVISION 

Before  leaving  this  topic,  let  me  relate  the  proposed  investment 
credit  to  our  longer  run  objectives  of  tax  reform.  In  important  part 
these  will  center  on  provision  for  a  broader  and  more  uniform  base 
but,  as  I  have  noted  above,  attention  must  also  be  given  to  the  re- 
quirements of  a  growing  economy.  As  the  President  states  in  his 
message : 

Some  departures  from  uniformity  are  needed  to  promote  desirable  social  or 
economic  objectives  of  overriding  importance  which  can  be  achieved  most  effec- 
tively through  the  tax  mechanism. 


I  On  tbe  basis  of  the  Department  of  Commerce  and  SEC  survey  of  anticipated  expenditures  on  plant 
and  equipment,  by  projecting  the  depreciation  deductions  shown  in  tax  returns  in  most  recent  years. 


320    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

As  indicated  by  the  President,  such  is  clearly  the  case  with  the  pro- 
posed investment  credit. 

The  importance  of  stimulating  modernization  and  capital  expansion 
and  of  doing  so  right  now  is  beyond  doubt.  Also,  it  is  clear  that  tax 
policy  can  make  a  vitally  needed  contribution  to  this  end.  The 
proposed  credit  offers  the  best  approach  and  achieves  this  incentive 
in  a  powerful  and  efficient  way.  Just  how  powerful  this  incentive  is 
can  be  measured  by  the  equivalence  in  effect  on  profitability  of  the 
15  percent  credit  to  a  50  percent  initial  writeoff.  The  tax  credit, 
at  the  same  time,  is  least  likely  to  waste  itself  in  benefits  which  do 
not  serve  the  purpose  of  inducing  modernization  and  expansion  and 
is  directed  most  squarely  to  those  who  are  prepared  to  respond  to  an 
incentive. 

II.  Equal  Taxation  of  Foreign  Investment  Income 

The  President  in  his  tax  message  has  cited  the  strains  in  our  balance- 
of-payments  position  as  one  of  the  factors  which  have  led  us  to  re- 
examine our  tax  treatment  of  foreign  income.  Earlier,  in  his  balance- 
of-payments  message,  the  President  made  it  clear  that  our  concern 
relates  to  the  'prejerential  treatment  of  foreign  investment  income, 
tax  treatment  that  has  favored  U.S.  private  investment  abroad  com- 
pared with  investment  in  our  own  country.  There  is  no  thought  of 
penalizing  private  investment  abroad  which  rests  upon  genuine 
production  or  market  advantages. 

ROLE    OF   TAX    DEFERRAL 

The  most  important  feature  of  our  tax  system  giving  preferential 
treatment  to  U.S.  investment  abroad  is  the  privilege  of  deferring 
U.S.  income  tax  on  the  earnings  derived  through  foreign  subsidiaries 
until  those  earnings  are  distributed  as  dividends.  The  lower  the 
rate  of  foreign  income  tax,  the  more  significant  is  this  privilege  of  tax 
deferral. 

I  have  here  a  table  showing  in  the  first  line  of  figures  the  statutory 
income  tax  rates  imposed  by  various  industrialized  countries  in 
Europe.  It  shows  a  range  of  rates  from  28 ^  percent  in  Belgium  to 
31  percent  in  Italy,  51  percent  in  Germany  and  53.5  percent  in  the 
United  Kingdom.  If  one  were  to  take  into  account  variations  in  the 
methods  of  computing  taxable  income,  the  range  of  effective  rates 
would  be  somewhat  lower,  but  similar  adjustments  would  have  to  be 
made  for  U.S.  tax  rates,  and  for  present  purposes  the  statutory  rates 
would  seem  to  be  the  appropriate  ones  to  use.  As  3''ou  can  see,  in 
most  of  these  countries,  and  particularly  those  countries  which  are 
our  more  important  competitors,  the  tax  rates  are  substantially  at 
the  same  level  as  the  U.S.  corporation  income  tax.  Tax  deferral  with 
respect  to  profits  earned  in  these  countries  does  not,  of  course,  have 
any  material  effect  on  U.S. -owned  firms. 


I 


I 


EXHIBITS 


321 


Com-parison  of  tax  rates  applicable  to  income  derived  in  selected  foreign  countries 
under  alternative  assumptions  concerning  form  of  organization 


Assumptions 

Bel- 
gium 

Den- 
mark 

France 

Ger- 
many 

Italy 

Nether- 
lands 

Sweden 

United 
King- 
dom 

1.  Corporation   organized    by   U.S. 
parent  in  country  where  all  op- 
erations are  conducted,  and  all 
profits  are  retained  by  subsidi- 
ary        -- 

Percent 
128.5 

29.1 

Percent 
M4.0 

28.5 

Percent 
50.0 

31.5 

Percent 
3  51.0 

32.9 

Percent 
»31.0 

22.0 

Percent 
47 

30 

Percent 
40 

28 

Percent 
•53.5 

2.  Corporation  organized  in  country 
wliere    manufacturing    is    con- 
ducted as  a  subsidiary  of  a  U.S.- 
owned    Swiss    parent;    parent 
makes  sales  and  derives  half  the 
total  profits,  and  receives  divi- 
dends from  the  subsidiary  « 

32.0 

•  Taxes  paid  In  the  previous  year  are  deductible  in  every  case,  thus  lowering  the  effective  tax  burden. 
Assuming  100  percent  distributions  each  year,  this  latter  adjustment  reduces  the  40  percent  nominal  Bel- 
gian tax  rate  to  28.5  percent. 

'  Because  of  a  special  deduction  measured  by  a  percentage  of  capital  stock  outstanding  and  allowed  to 
all  Danish  corporations,  the  rate  may  be  reduced  as  low  as  22  percent.  The  average  rate  for  most  corpo- 
rations is  36  percent. 

3  The  German  corporate  rate  of  51  percent  is  reduced  to  approximately  22  percent  if  all  profits  are  dis- 
tributed. This  tax  plus  the  creditable  portion  of  the  capital  tax  would  amount  to  a  total  combined  rate 
of  approximately  37  percent. 

•  Includes  some  allowance  for  excess  profits  tax  imposed  at  the  rate  of  15  percent  on  profits  in  excess  of  6 
percent  of  capital  plus  cerfciin  allowable  reserves. 

'  Taking  into  account  the  increase  announced  in  the  1961-62  budget  message. 

«  The  Swiss  Federal  tax  rate  is  8  percent.  In  addition,  income  taxes  are  also  imposed  in  varying  degrees 
by  the  cantons.  However,  substantial  tax  concessions  may  be  granted  by  the  cantons.  In  the  canton  of 
Geneva,  for  instance,  the  granting  of  such  concessions  would  result  in  an  aggregate  tax  rate  of  15  percent, 
or  13  percent  taking  into  account  the  fact  that  ta.xes  paid  in  the  preceding  year  are  allowed  as  a  deduction. 
Foreign  source  dividends  are  not  taxable  in  Switzerland. 

However,  to  the  extent  that  business  operations  are  conducted 
in  countries  with  lower  tax  rates,  there  is  considerable  leeway  for 
deferring  U.S.  tax.  With  a  foreign  tax  rate  of  28K  percent,  for  example, 
a  company  can  defer  U.S.  tax  payments  equal  to  23^2  percent  of  total 
pretax  profits.  It  thus  can  through  deferral  retain  nearly  an  extra 
dollar  out  of  every  four  that  it  earns. 

These  statutory  rates,  however,  do  not  give  adequate  weight  to 
the  variet}^  of  arrangements  that  have  been  made  by  American  firms 
in  their  foreign  operations  which  may  bring  down  rather  substantially 
the  rates  of  tax  imposed  on  income  from  their  foreign  operations. 
Thus,  an  American  company  operating  in  West  Germany  through  a 
German  subsidiary  will  be  subject  to  tax  there  at  the  West  German 
income  tax  rate  of  51  percent,  and  hence  it  cannot  benefit  significantly 
from  U.S.  tax  deferral.  However,  to  the  extent  that  the  profits  of  the 
German  subsidiary  can  be  diverted  from  the  sweep  of  the  German  tax 
system,  a  lower  tax  on  profits  can  be  attained.  And  this  is  precisely 
what  is  achieved  through  a  proliferation  of  corporate  entities  in  tax 
haven  countries,  like  Switzerland. 

The  tax  haven  companies  are  given  the  right  to  license  patents 
developed  b}^  their  parent  organizations  or  sister  corporations. 
They  supply  the  services  of  technicians  of  their  corporate  affiliates 
to  firms  in  various  other  countries.  They  acquire  the  distribution 
rights  of  products  manufactured  by  their  affiliates.  The  transfer 
of  these  various  activities  to  tax  haven  entities  means  a  transfer  of 


322   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

income  to  them.  Since  the  income  taxes  in  these  tax  haven  countries 
are  very  low  or  nonexistent  with  respect  to  income  derived  outside 
their  own  borders,  the  result  of  these  arrangements  is  to  bring 
about  a  substantial  reduction  in  tax  on  the  total  income  derived 
from  the  foreign  operations.  Switzerland,  for  example,  has  a  federal 
income  tax  ranging  from  3  to  8  percent.  While  local  income  taxes 
vary  widely,  there  are  opportunities  for  the  negotiation  of  tax  liability 
to  the  cantons.  With  U.S.  tax  deferral  operating  simultaneously, 
tax  payments  overall  can  be  and  often  are  very  substantially  reduced. 

If  $100  of  income  of  a  German  subsidiary  can  be  segmented  so 
that  $50  is  attributed  to  the  entity  in  Germany  and  $50  attributed 
to  a  selling  entity  in  Switzerland,  half  the  profit  would  be  subject  to 
the  51  percent  German  tax  rate  but  the  other  half  would  be  subject 
to  a  Swiss  national  tax  of  only  8  percent.  The  overall  rate  of  tax 
would  thus  be  reduced  to  less  than  30  percent.  The  table  I  last 
referred  to  shows  on  the  second  line  the  aggregate  income  tax  in  cases 
where  manufacturing  subsidiaries  are  organized  in  various  European 
countries  but  which  effect  their  sales  through  a  Swiss  sales  corporation 
so  that  taxable  profits  are  divided  equally  between  the  country  of 
manufacture  and  Switzerland.  As  a  consequence  of  such  arrange- 
ments, and  taking  into  account  withholding  taxes  on  dividends 
transferred  from  the  manufacturing  company  to  the  Swiss  sales 
company,  the  resulting  tax  rates  range  from  about  22  to  33  percent. 

The  reductions  in  tax  that  can  be  achieved  through  the  use  of  tax 
haven  operations  assume  that  the  incomes  attributed  to  the  tax  haven 
companies  are  fair  and  reasonable.  But  the  problem  is  compounded 
by  the  fact  that  incomes  are  often  allocated  to  tax  haven  companies 
which  are  not  economically  justifiable.  U.S.  companies  frequently 
attribute  a  disproportionate  share  of  profits  to  the  trading,  licensing, 
and  servicing  companies  established  in  tax  haven  countries — a 
practice  that  is  extremely  difficult  if  not  impossible  for  the  Internal 
Revenue  Service  to  police  effectively. 

This  is  not  simply  a  question  of  allocating  the  profits  of  foreign 
operations  to  tax  haven  countries.  It  is  a  problem  that  significantly 
affects  U.S.  taxation  of  domestic  profits.  The  technique  that  is  used 
for  diverting  profits  from  one  company  to  another  among  European 
affiliates  is  also  used  to  divert  income  from  U.S.  companies  to  foreign 
affiliates.  Income  that  would  normally  be  taxable  by  the  United 
States  is  thrown  into  tax  haven  companies  with  the  object  of  obtaining 
tax  deferral.  This  is  done,  for  example,  by  placing  in  a  Swiss  or 
Panamanian  corporation  the  activities  of  the  export  division  of  a 
U.S.  manufacturing  enterprise.  A  very  substantial  volume  of  ex- 
ports is  required  merely  to  offset  the  loss  in  foreign  exchange  which 
the  retention  abroad  of  export  profits  entails. 

The  recent  growth  of  U.S.  subsidiaries  in  tax  haven  countries — 
and  Switzerland  and  Panama  are  but  two  examples — suggests  that 
their  importance  as  a  means  of  tax  reduction  and  avoidance  will 
rapidly  increase  if  the  deferral  privilege  is  continued.  An  examina- 
tion of  the  public  records  in  Switzerland  alone  indicates  that  there  are 


EXHIBITS  323 

more  than  500  firms  there  which  can  be  identified  as  being  owned  by 
U.S.  interests.  About  170  of  these  were  created  in  the  year  ending 
March  31,  1961.  U.S.  officials  on  the  spot  are  of  the  opinion  that 
in  addition  to  these  firms  there  are  a  substantial  number  of  other 
U.S. -owned  firms  in  Switzerland  which  cannot  be  readily  identified  as 
such  on  the  basis  of  the  presently  available  data.  Increasingly,  U.S. 
manufacturing  subsidiaries  operating  elsewhere  in  Europe  are  being 
linked  to  subsidiaries  in  the  tax  haven  countries.  Parenthetically,  I 
might  note  that  the  information  returns  filed  by  U.S.  shareholders  or 
officers  of  foreign  corporations  indicate  that  there  are  only  92  U.S.- 
owned  corporations  in  Switzerland  all  told.  There  is  little  doubt  that 
these  information  returns  are  inadequate  and  incomplete.  The 
tightened  requirements  for  filing  information  returns  on  new  foreign 
corporations  which  were  adopted  by  the  Congress  last  year  will 
doubtless  give  us  more  accurate  information  in  the  future. 

PROPOSAL    REGARDING    ADVANCED    COUNTRIES    AND    TAX    HAVEN 

OPERATIONS 

To  avoid  artificial  encouragement  to  investment  in  other  advanced 
countries  as  compared  with  investment  in  the  United  States,  we  pro- 
pose that  American  corporations  be  fully  taxed  each  year  on  their 
current  share  in  the  undistributed  profits  realized  by  subsidiary  cor- 
porations organized  in  economically  advanced  countries.  This  change 
in  the  method  of  taxation  should  be  achieved  over  2  years,  with  only 
half  of  the  profits  aft'ected  in  1962.  Deferral  of  tax  would  also  be 
ehminated  for  individual  shareholders  controlling  closely  held  foreign 
corporations  in  the  industrialized  countries.  The  proposed  change 
will  not  alter  the  principle  that  companies  may  credit  income  taxes 
paid  abroad  against  U.S.  income  tax  liability. 

In  view  of  the  national  objective  of  aiding  the  development  of  less- 
advanced  countries,  we  do  not  propose  the  same  change  in  the  tax 
treatment  of  income  from  investments  in  less-developed  countries. 
Tax  deferral  wiU  continue  to  apply  with  respect  to  operations  in  those 
areas,  except  that  we  propose  to  eliminate  deferral  in  the  case  of  tax 
haven  companies  even  in  the  less  industriahzed  countries.  For  this 
purpose,  a  tax  haven  company  would  be  defined  generally  as  one 
receiving  more  than  20  percent  of  its  gross  profit  from  sources  outside 
the  country  in  which  it  is  created. 

This  test  would  reach  such  typical  tax  haven  activities  as  export 
and  import  companies,  licensing  companies,  and  insurance  companies. 
However,  the  general  test  would  be  qualified  so  as  not  to  affect  manu- 
facturing companies  operating  in  less-developed  regions  which  must 
look  to  more  than  one  country  for  their  markets.  Other  possible 
areas  of  exception  may  be  considered  in  the  light  of  forthcoming 
testimony  before  this  committee. 

While  it  is  difficult  to  estimate  quantitatively  by  how  much  tax 
deferral  has  contributed  to  the  balance-of-payment  deficit,  it  has 
surely  been  a  significant  factor.     Particularly  when  it  is  enhanced  by 


324   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

the  resort  to  tax  havens,  tax  deferral  has  given  artificial  encouragement 
to  foreign  investment  and  has  acted  as  a  deterrent  to  the  repatriation 
of  dividend  income.  Deferral  thus  adversely  affects  our  balance-of- 
payments  position  by  increasing  payments  and  reducing  receipts.  For 
the  4  years  1957  through  1960,  the  U.S.  capital  outflow  to  Western 
European  subsidiaries  amounted  to  $1.7  billion,  raising  the  total  in- 
vestment in  these  subsidiaries  to  $6.2  billion  at  the  end  of  1960. 
Earnings  from  these  subsidiaries  in  the  same  period  were  $2.4  billion, 
of  which  $1.1  biUion  were  reinvested  abroad  and  $1.3  bihion  were 
remitted  to  the  United  States  in  dividends.  On  balance,  the  outflow 
for  the  4-year  period  exceeded  dividend  remittances  by  $400  million. 
Much  the  same  picture  appUes  to  Canada.  The  capital  outflow  in  the 
same  4  years  amounted  to  $1.3  billion,  bringing  our  investment  there 
to  $9.3  billion.  Earnings  were  $2.4  billion,  but  $1.3  billion  were 
reinvested  and  only  $1.1  billion  were  remitted  in  dividends.  Thus, 
capital  outflow  exceeded  dividend  remittances  by  $200  million. 

It  is  true  that  deferral  causes  U.S.  assets  abroad  to  rise  more  rapidly 
than  they  would  otherwise,  so  that  dividend  remittances  would  also 
tend  to  rise  over  a  long  span  of  years.  But  the  time  span  is  apt  to 
be  very  long.  The  attached  chart  shows  how  the  tax  deferral  privi- 
lege can  result  in  a  slower  remittance  of  earnings  from  investment  in 
a  foreign  subsidiary,  as  compared  ^^dth  a  situation  in  which  the  de- 
ferral privilege  did  not  exist.  Suppose  an  investment  of  $1,000  in  a 
foreign  subsidiary  that  yields  20  percent  a  year  before  taxes,  and  that 
the  foreign  tax  rate  is  20  percent.  Suppose  also  that  the  subsidiary 
reinvests  all  of  its  after-tax  earnings  for  5  years;  and  then  for  the  next 
15  years  reinvests  half  its  profits  and  remits  half  its  profits  to  the 
United  States  as  dividends. 

Without  the  deferral  privilege,  as  the  solid  line  shows,  the  company 
would  immediately  begin  to  remit  funds  for  U.S.  tax  payments  on  its 
earnings. 

With  the  dejerral  privilege,  as  the  dotted  fine  shows,  the  company 
reinvests  the  funds  it  would  otherwise  have  remitted  for  U.S.  tax- 
payments  and  it  remits  nothing  for  the  first  5  years.  The  greater 
amount  of  reinvestment  results  in  a  more  rapid  growth  of  its  net 
worth,  and  increases  its  earnings  and  remittances,  once  they  begin. 
Nevertheless,  it  will  be  17  years  before  cumulative  remittances  to  the 
United  States  equal  those  that  would  have  occurred  if  the  deferral 
privilege  had  not  existed.  On  the  chart  this  point  is  reached  where 
the  curves  cross. 

Actually,  this  is  an  optimistic  example  since  it  assumes  that  with 
the  deferral  privilege  the  subsidiary  will  begin  remitting  half  of  its 
after-foreign-tax  earnings  from  the  sixth  year  on.  In  practice,  the 
existence  of  the  deferral  privflege  may  lead  it  to  remit  a  considerably 
lower  portion  of  its  profits  and  thus  prolong  further  the  time  when 
the  two  curves  cross. 


EXHIBITS 


325 


CUfyfULATIVE  RE^iTTANCES  TO  U.S.  FRCS^ 
NET  EARNINGS  OF  A  U.S.  FOREIGN  SUBSIDIARY 


Dollars 

_ 

Model  A" 

y 

4,000 

- 

3.000 

Without  Deferral  ^^  ^,^<^ 

2,000 

" 

^^,,^'-'^;^"'^*^WItli  Deferral 

1,000 

- 

-^"^^"""^ 

0 

1 

l"'< 



5 

10                        15                        20 

Years 


'fnifial  investment  $1,000:  annual  rate  of  earnings  before  taxes  20%;  foreign  tax 
rate  20%;  It.  S.  tax  rote  50%.  Reinvestment  of  all  after-fax  earnings  for  first  5 years, 
and  reinvestment  of  half  after-tax  earninos  for  next  15  vsars. 


Today  our  situation  is  such  that  we  must  look  first  to  the  more 
immediate  balance-of-payments  results.  Last  fall,  as  you  know,  our 
balance-of-pa3mients  position  led  to  a  crisis  which  threatened  the 
stability  of  the  dollar  and  therefore  jeopardized  the  economic  health 
of  the  entire  free  world.  Although  returning  confidence  has  given  a 
temporary  reprieve,  it  is  important  that  we  act  to  prevent  a  recur- 
rence of  last  fall's  situation.  We  must  improve  our  balance-of-pay- 
ments position.  Eliminating  the  deferral  privilege  will  help  us  to 
do  so. 

It  may  be  estimated,  although  very  roughly,  that  the  elimination  of 
the  deferral  privilege  for  subsidiaries  in  advanced  coimtries  and  for  tax 
haven  operations  in  all  countries  would  improve  our  balance-of-pay- 
ments position  by  as  much  as  $390  million  per  annum.  This  estimate 
includes  the  increase  in  remittances  for  U.S.  taxpayments  on  foreign 
earnings,  as  well  as  increased  dividend  remittances  and  a  lower  level 
of  capital  outflow  than  would  occur  if  the  present  privilege  were  con- 
tinued. 

I  have  heard  it  said  that  elimination  of  tax  deferral  such  as  we  pro- 
pose will  not  help  our  balance  of  pa3mients.  Some  people  even  go  so 
far  as  to  claim  that  it  will  injure  our  payments  position.  In  my 
opinion  this  view  is  utterly  erroneous.  I  would  cite  in  support  of  my 
opinion  that  of  the  responsible  financial  leaders  of  Europe.  In  mid- 
January,  during  the  height  of  our  balance-of-payments  difficulties,  the 
finance  ministers  of  the  six  Common  Market  countries  met  and  dis- 


326   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

cussed  the  U.S.  balance-of-payments  position.  They  were  good 
enough  to  give  us  the  general  tenor  of  their  thinking.  In  particular, 
the  ministers  informed  us  of  their  unanimous  belief  that  the  United 
States  would  be  justified  in  discontinuing  the  fiscal  incentives  which 
encouraged  the  nonremittance  of  profits  made  in  Europe.  This  view- 
point from  countries  which  have  an  interest  in  attracting  and  keeping 
U.S.  investment  is  strong  confkmation  of  our  own  judgment  regard- 
ing the  adverse  impact  of  the  deferral  privilege  on  our  balance  of 
payments. 

While  relief  for  the  balance  of  payments  is  an  important  reason  for 
discontinuing  tax  deferral,  it  is  not  the  only  one.  There  exists,  in 
addition,  an  important  issue  of  equity  which  has  a  significant  bearing 
on  domestic  employment  and  production,  as  well  as  an  indirect  bear- 
ing on  our  balance-of-payments  position.  With  the  present  deferral 
privilege,  an  American  firm  contemplating  a  new  investment  and  find- 
ing cost  and  market  conditions  comparable  at  home  and  abroad  is 
impelled  toward  the  investment  opportunity  overseas.  This  is  so  be- 
cause it  would  thereafter  be  able  to  finance  expansion  on  the  basis  of 
an  interest-free  loan  from  the  U.S.  Treasury,  repayable  at  the  option 
of  the  borrower.     Tax  deferral,  after  all,  is  just  such  a  loan. 

This  issue  of  equity  is  sometimes  presented  in  reverse;  namely,  that 
the  withdrawal  of  the  deferral  privilege  would  be  unfair  because  it 
would  change  the  rules  on  which  companies  have  alread}^  based  major 
investment  decisions.  This  argument  seems  to  me  to  be  very  ques- 
tionable. During  the  postwar  period  the  promotion  of  private  for- 
eign investment  in  both  advanced  and  less-developed  countries  was  in 
the  public  interest.  Times  have  changed,  and  the  need  to  stimulate 
investment  in  advanced  countries  no  longer  exists.  Hence,  there  can 
be  no  proper  claim  that  preferential  treatment  should  be  continued 
merely  to  perpetuate  a  private  gain.  This  change,  moreover,  cannot 
severely  injure  companies  already  abroad,  for  a  change  in  the  timing  of 
income  tax  liability  will  not  normally  tm-n  a  profit  into  a  loss.  At 
most,  it  may  slow  the  growth  of  companies  abroad  or  make  the  financ- 
ing of  growth  somewhat  more  expensive.  To  alleviate  possible  prob- 
lems, our  proposal  would  remove  the  tax  deferral  privilege  in  two 
steps. 

It  is  sometimes  contended  that  if  U.S.  firms  are  to  compete  suc- 
cessfully abroad  they  must  enjoy  as  favorable  a  tax  treatment  as 
their  foreign  competitors.  I  believe  that  this  argument  has  been 
overly  stressed.  A  difference  in  tax  rates,  I  said  before,  should  not 
handicap  companies  producing  abroad,  although  it  may  slow  the 
rate  of  ex-pansion.  But  even  if  this  argument  were  fully  valid,  it 
could  not  be  a  decisive  objection  to  our  proposal.  As  long  as  the  tax 
systems  of  various  countries  dift'er — and  I  venture  to  predict  that 
this  will  be  the  case  for  years  to  come — we  must  make  a  firm  choice. 
Either  we  tax  the  foreign  income  of  U.S.  companies  at  U.S.  tax  rates 
and  credit  income  taxes  paid  abroad,  thereb}^  eliminating  the  tax 
factor  in  the  U.S.  investor's  choice  between  domestic  and  foreign 
investment;  or  we  permit  foreign  income  to  be  taxed  at  the  rates 
applicable  abroad,  thereby  removing  the  impact,  if  any,  which  tax 
rate  differences  may  have  on  the  competitive  position  of  the  American 
investor  abroad.  Both  tj^^es  of  neutrality  cannot  be  achieved  at 
once.     I  believe  that  reasons  of  tax  equity  as  well  as  reasons  of  eco- 


EXHIBITS  327 

nomic  policy  clearly  dictate  that  in  the  case  of  investment  in  other 
industrialized  countries  we  should  give  priority  to  tax  neutrality  in 
the  choice  between  investment  here  and  investment  abroad. 

This  does  not  mean  that  elimination  of  the  deferral  privilege 
would  end  U.S.  investment  in  foreign  subsidiaries.  In  many  cases, 
foreign  investment  opportunities  will  remain  more  attractive  al- 
though the  same  rates  of  tax  apply  to  subsidiary  earnings  as  to 
income  from  a  domestic  business.  Many  U.S.  subsidiaries  in  high 
tax  countries  such  as  the  United  Kingdom  and  Germany  have  not 
exploited  tax  haven  opportunities  and  are  therefore  paj^ng  taxes 
closely  comparable  to  those  in  the  United  States.  Yet  these  com- 
panies compete  effectively.  Curtailment  of  foreign  investment  which 
can  survive  only  under  the  shelter  of  preferential  tax  treatment  can 
only  be  in  the  U.S.  interest  and  in  the  interest  of  the  world  economy. 
It  will  help  domestic  growth,  strengthen  our  balance-of-payments 
position,  and  (a  matter  in  which  I  am  not  entirely  disinterested)  sub- 
stantially increase  tax  receipts. 

CREDITING    OF    FOREIGN    TAX 

The  credit  for  foreign  income  taxes  allowed  a  taxpayer  under 
existmg  law  operates  so  as  to  grant  an  excessive  allowance  when 
business  activities  are  conducted  abroad  through  a  foreign  sub- 
sidiary. When  a  foreign  subsidiary  pays  income  tax  abroad,  the 
portion  of  its  profits  utilized  for  this  purpose  is,  of  course,  not  available 
for  distribution  as  a  dividend  to  the  parent.  The  foreign  income  tax 
is,  in  effect,  deducted  from  taxable  profits.  When  the  U.S.  parent 
company  receives  dividends  from  its  subsidiary  it  is  allowed  a  credit 
for  a  proportionate  part  of  the  income  tax  paid  by  the  subsidiary. 
Thus  both  a  deduction  and  a  credit  are  allowed  for  the  same  income 
tax.  The  result  is  to  bring  about  a  combined  foreign  and  domestic 
effective  tax  rate,  m  the  optimum  case,  of  about  45  percent  instead 
of  the  statutory  rate  of  52  percent. 

This  may  be  clearer  from  the  example  shown  on  the  attached  table. 
With  a  foreign  income  tax  rate  of  30  percent  on  the  foreign  subsidiary, 
the  combined  effective  tax  rate  is  45.4  percent  instead  of  52  percent. 
The  present  method  of  computing  the  credit  for  foreign  income  tax 
thus  offers  a  substantial  inducement  to  investment  abroad  through  a 
foreign  subsidiary  and  produces  serious  tax  discrimination  against  in- 
vestment in  the  United  States.  The  differential  may  be  enlarged 
even  further  if  operations  abroad  are  arranged  through  two  foreign 
subsidiaries. 

To  eliminate  this  unjustified  tax  advantage,  it  is  proposed  that  a 
taxpayer  be  required,  as  a  condition  for  obtaining  the  credit,  to  in- 
clude in  taxable  income  his  share  of  profits  before  foreign  tax.  The 
resulting  gain  in  our  tax  receipts  on  foreign  earnings  may  be  estimated 
at  $110  million  a  year. 

SHARES    IN    FOREIGN    INVESTMENT    COMPANIES 

Shareholders  in  domestic  regulated  investment  companies  are  sub- 
ject to  tax  currently  on  the  earnings  of  the  investment  companies 
because  the  earnings  must  be  distributed  currently  if  the  companies 


328    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


are  to  be  relieved  of  the  corporate  income  tax.  Foreign  investment 
companies  whose  shares  are  held  by  U.S.  shareholders  are  not  subject 
to  U.S.  tax,  except  on  income  from  U.S.  sources.  Hence,  they  may 
accumulate  earnings  indefinite!}^.  Moreover,  when  a  shareholder  re- 
ceives his  pro  rata  portion  of  such  accumulated  earnings  by  submitting 
his  shares  to  the  company  for  redemption,  he  obtains  capital  gains 
treatment  on  the  income. 

Example 

Computation  of  foreign  tax  credit  for  dividends  from  foreign  subsidiary 


Present  law 


Proposal 


Profits  of  subsidiary , 

Foreign  tax 

Dividend  to  U.S.  parent 

Plus"grossup"  of  foreign  taxes 

Tentative  U.S.  tax  at  52  percent 

Credit  for  foreign  taxes  paid  by  subsidiary. 

Net  U.S.  tax 

Combined  foreign  and  U.S.  tax 


$100. 00 
30.00 
70.00 


36.40 
21.00 
15.40 
45.40 


$100 
30 
70 
30 
52 
30 
22 
52 


These  foreign  investment  companies  formed  to  attract  U.S.  share- 
holders are  organized  in  localities  where  the  companies  themselves 
are  subject  to  little  or  no  tax  as  in  Canada  or  Bermuda. 

We  propose  to  eliminate  this  preferential  treatment  of  investments 
in  foreign  investment  companies  by  requiring  U.S.  shareholders  in 
such  companies  to  pay  tax  currently  on  their  share  of  the  income 
derived  by  the  foreign  investment  company.  Since  the  SEC  requires 
such  companies  to  report  their  earnings  currently,  there  is  no  serious 
administrative  difficulty  involved  in  making  this  change. 


LIMITATION    OF    EARNED    INCOME    EXCLUSION    UNDER    SECTION    911 

Under  existing  law,  an  individual  citizen  of  the  United  States  who 
qualifies  as  a  foreign  resident  is  granted  tax  exemption  on  his  entire 
earned  income  from  outside  the  United  States.  In  addition  an 
individual  who  goes  abroad  without  establishing  a  foreign  residence 
and  remains  abroad  for  a  period  of  17  out  of  18  consecutive  months 
is  exempt  with  respect  to  his  earned  income  up  to  $20,000  a  year. 

Available  evidence  mdicates  that  there  were  approximately  50,000 
American  citizens  who  were  living  abroad  in  1959  and  who  claimed 
an  aggregate  exemption  of  more  than  $500  million  for  that  year 
under  these  two  provisions.  One  individual  excluded  earned  income 
of  almost  a  million  dollars  for  1  year.  A  number  of  others  reported 
excluded  income  of  between  $100,000  and  $500,000,  as  the  attached 
table  shows. 


EXHIBITS 


329 


Individuals  claiming  tax  exemption  of  earned  income  of  $100,000  or  more  under  sec. 
911  on  tax  returns  filed  in  calendar  year  1960 


Taxpayer  identification  no. 


Country  of  residence 


Adjusted 

Amount  of 

gross  Income 

meome 

reported 

excluded 

$32,  791 

$186, 751 

14, 739 

108, 638 

26,  797 

996,200 

17, 651 

130, 766 

64,  985 

105, 707 

20,931 

217,500 

22,813 

583, 087 

5,976 

136,700 

5,111 

122, 260 

8,021 

160,000 

6,729 

107,000 

8,984 

107, 367 

756 

184,171 

1,345 

155, 360 

48, 876 

119, 551 

74, 586 

115,523 

122,  951 

156,000 

146, 821 

265, 540 

132 

111,870 

2,321 

217,121 

0 

161,083 

0 

151,167 

0 

122, 307 

431 

153, 078 

331 

449, 803 

3,182 

131,950 

282 

129, 570 

240 

160,  450 

4,493 

144, 833 

0 

150, 059 

5,677 

117,556 

2,893 

162, 500 

3,161 

105, 145 

C-1.. 
C-2.. 
C-3- 
C-4.. 
C-5.. 
C-6.. 
C-7.. 
C-8.. 
C-9.- 
C-10. 
C-U. 
C-12- 
C-13- 
C-14. 
C-1 5. 
C-16. 
C-1 7. 
C-18- 
C-19. 
C-20. 
C-21- 
C-22- 
C-23. 
C-24. 
C-25. 
C-26. 
C-27. 
C-28-, 
C-29., 
C-30. 
C-31- 
C-32., 
C-33-. 


Canada 

Philippines 

(•) — 

England 

Australia 

England 

Mexico 

Canada 

Japan 

Switzerland 

Venezuela 

do 

do 

Switzerland 

Venezuela 

France 

Switzerland 

Philippines 

do- 

Argentina.. 

Venezuela 

Lebanon 

Ecuador 

Venezuela 

BrazU 

Philippines 

Venezuela 

Germany 

Brazil 

Dominican  Republic- 
Switzerland 

England 

Venezuela.. 


'  Not  listed  to  avoid  disclosure. 

Source:  U.S.  Treasury  Department,  Internal  Revenue  Service. 

I  believe  that  it  is  an  unsound  policy  for  the  U.S.  Government 
generally  to  subsidize  through  tax  exemption  those  of  its  citizens  who 
wish  to  live  abroad.  This  is  especially  so  for  individuals  who  establish 
their  residence  abroad  for  tax  purposes  even  though  the  nature  of 
their  business  does  not  require  it.  It  is  manifestly  unfair  to  other 
taxpayers  to  continue  these  exemptions  which  also  contribute  to  our 
adverse  balance-of-payments  position.  For  these  reasons,  the  Presi- 
dent has  recommended  that  the  tax  exemptions  now  accorded  the 
earned  income  of  American  citizens  who  are  abroad  be  eliminated 
entirely  for  those  living  in  economically  developed  countries. 

Here,  again,  the  less-developed  countries  pose  a  different  problem. 
It  is  in  the  public  interest  that  Americans  skilled  in  industry,  educa- 
tion, medicine,  and  other  professions  be  encouraged  to  go  to  these 
countries  and  contribute  to  their  economic  development.  It  is  recom- 
mended therefore  that  the  exemption  for  foreign  residents  be  con- 
tinued for  those  resident  in  these  areas  but  only  to  the  extent  of  $20,000 
per  year.  The  present  exemption  of  $20,000  for  those  who  remain 
abroad  for  17  out  of  18  months  would  also  be  continued  for  those 
individuals  working  in  the  less-developed  countries. 


330        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
ESTATE    TAX    EXEMPTION    FOR    FOREIGN    REAL    ESTATE 

The  President  recommended  that  the  existing  exemption  of  foreign 
real  estate  from  the  Federal  estate  tax  be  eliminated.  In  recent  3'ears 
this  also  has  been  a  subject  of  abuse.  Primarily  because  of  this  tax 
feature,  persons  have  been  induced  to  make  investments  in  foreign  real 
estate  in  countries  which,  due  to  their  very  low  tax  rates,  could  be 
appropriately  termed  "estate  tax  havens."  Under  legislation  adopted 
in  1951,  credit  is  allowed  for  estate  and  inheritance  taxes  paid  abroad, 
and  there  is  no  justification  for  continuing  the  special  exemption  for 
foreign  real  estate. 

In  addition  to  the  changes  that  I  have  just  discussed,  there  are 
several  other  proposals  of  a  relatively  minor  nature  which  are  covered 
in  the  technical  statement. 

SUMMARY 

The  foregoing  set  of  proposals  is  designed  to  place  the  tax  treatment 
of  foreign  income  on  a  more  equal  footing  with  that  of  domestic 
income.  These  proposals  are  estimated  to  increase  revenues  by  $275 
million  annually.  Taken  together  these  proposals  may  be  expected 
to  improve  our  balance-of-payments  position  by  as  much  as  $525 
million  a  year,  of  which  about  one-half  would  represent  increased  tax 
receipts  on  foreign  earnings.  Therefore,  enactment  of  these  proposals 
will  mark  a  significant  forward  step  in  the  battle  to  safeguard  the 
dollar.  It  is  essential  that  we  win  this  battle  and  win  it  quickly. 
Thus,  these  proposals  have  a  special  significance  far  higher  than  the 
increase  in  tax  receipts. 

Ill,  Correction  of  Other  Structural  Defects 

We  are  currently  examining  the  income  tax  structure,  using  recent 
studies  by  congressional  committees  as  well  as  materials  developed  by 
the  Treasury.  Our  objective  is  to  develop  a  basic  program  of  tax 
reform.  Studies  of  some  parts  of  this  program  have  been  compl  eted, 
and  in  these  areas  the  President  has  recommended  action  at  this  time. 

Adoption  of  these  recommendations  will  improve  the  equity  of  the 
tax  structure  and  constitute  an  important  first  step  toward  tax  re- 
form. The  President  has  directed  the  Treasury  to  continue  with  its 
research  and  studies  aimed  at  providing  a  broader  and  more  uniform 
tax  base  together  with  an  appropriate  rate  structure.  Additional 
proposals  to  this  end  will  be  submitted  next  year.  I  turn  now  to  the 
President's  recommendations  for  this  year. 

1.  tax  withheld  on  dividend  and  interest  income 

We  must  face  the  serious  and  continuing  problem  of  numerous 
individuals  failing  to  report  dividend  and  interest  income  for  tax  pur- 
poses. This  results  in  substantial  revenue  losses  to  the  Government 
and  is  unfair  to  those  who  pay  all  of  their  taxes. 

General  tax  compliance  with  respect  to  income  from  salaries  and 
wages  has  been  largely  and  satisfactorily  achieved  by  a  system  of 
tax  withholding.  This  system  has  been  of  help  not  only  to  the  Gov- 
ernment but  also  to  the  wage  earner  in  paying  his  taxes  in  a  gradual 
and  S3^stematic  manner.     A  similar  system  should  be  extended  to 


EXHIBITS  331 

dividend  and  interest  income  to  assure  and  facilitate  tax  compliance. 

This  matter  has  been  considered  at  various  times  by  the  Congress 
and  withholding  provisions  were  passed  by  the  House  of  Representa- 
tives in  1942,  1950,  and  1951.  I  beheve  that  we  have  now  developed 
a  plan  which  overcomes  the  objections  which  have  been  raised  pre- 
viously. 

Legislative  action  is  clearly  needed.  The  failure  to  report  dividends 
and  interest  income  cannot  be  dealt  with  adequately  through  educa- 
tion programs. 

In  1959  the  Treasury  Department  launched  an  extensive  educational 
program  to  remind  taxpayers  to  report  their  full  interest  and  dividend 
income  on  their  1959  income  tax  returns  which  were  to  be  filed  in 
early  1960.  Payers  of  interest  and  dividends  cooperated  fully  with 
the  Treasury,  and  tens  of  milHons  of  reminder  notices  were  distributed 
by  them.  Publicity  campaigns  were  organized  using  newspapers, 
magazines,  radio,  and  television.  The  cooperative  effort  of  corpora- 
tions, banks,  the  stock  exchanges,  communications  media,  and  others 
in  the  educational  campaign  has  been  greatly  appreciated  by  the 
Department. 

Unfortunately,  the  evidence  indicates  that  despite  these  sub- 
stantial efforts,  there  has  been  at  best  only  a  slight  improvement. 
While  compared  to  1958  returns,  a  larger  number  of  taxpayers  re- 
ported this  type  of  income  in  the  1959  returns  and  while  the  overall 
percentages  of  reported  interest  and  dividends  improved  slightly, 
the  absolute  amounts  of  unreported  interest  and  dividends  actually 
increased  because  of  the  larger  overall  payments  of  interest  and 
dividend  income  in  1959.  The  most  recent  Treasury  study  indicates 
that  for  1959  income,  taxable  individuals  failed  to  report  an  estimated 
$834  million  of  dividends  and  $1,995  million  of  interest  payments, 
or  a  total  of  $2,829  million.  By  including  the  unreported  interest 
and  dividend  incomes  of  those  filing  nontaxable  returns,  the  total 
nonreporting  gap  for  1959  is  increased  to  $3,777  million. 

It  is  further  estimated  that  11  percent  of  nonreported  dividends 
were  received  by  taxpayers  with  incomes  below  $5,000,  18  percent  by 
those  with  incomes  between  $5,000  and  $10,000,  and  71  percent  by 
those  with  incomes  in  excess  of  $10,000.  The  corresponding  per- 
centages for  nonreported  interest  income  were  29,  42,  and  29  percent. 
The  failure  to  report  1959  interest  and  dividends  is  estimated  to 
have  cost  the  Government  $864  million. 

The  problem  cannot  be  solved  by  increased  audit  and  enforcement 
procedures.  Nonreporting  of  interest  and  dividends  is  a  mass  com- 
pliance problem.  Some  of  the  nonreporting  is  deliberate  tax  evasion, 
but  much  of  it  is  due  to  inadvertence,  forgetfulness,  and  failure  to 
keep  records,  particularly  by  taxpayers  who  receive  a  small  portion 
of  their  incomes  from  such  sources.  Obviously,  it  is  impracticable 
and  inefficient  to  rely  only  on  information  documents  combined  with 
audit  procedures  to  verify  and  to  follow  up  on  millions  of  interest  and 
dividend  transactions.  The  Government,  at  best,  can  be  expected 
to  recover  at  a  high  cost  only  a  small  proportion  of  the  unreported 
tax  by  this  method.  An  inordinate  amount  of  time  and  money  would 
have  to  be  spent  in  the  attempt  to  close  the  gap,  and  little  would  be 
gained  by  it. 

614359—^62 22 


332   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

To  meet  this  need  for  compliance,  we  recommend  instead  that  a 
20  percent  withholding  rate  be  applied  to  interest  and  dividends. 
Withholding  would  be  apph cable  to  dividends  paid  by  domestic 
corporations,  interest  paid  on  deposits  in  savings  institutions,  such  as 
banks,  savings  and  loan  associations,  and  building  and  loan  associa- 
tions, interest  paid  on  U.S.  Government  and  corporate  securities  other 
than  short-term  discount  obligations,  and  to  patronage  dividends 
allocated  by  cooperatives. 

The  withholding  system  we  recommend  would  not  impose  any 
substantial  burden  on  the  payers  of  dividends  and  interest.  In  fact, 
there  would  be  little  additional  work  as  compared  to  their  present 
operations.  The  withholding  agent  would  be  asked  to  withhold  on  a 
simple  fiat  rate  basis  without  exemptions  and  he  would  not  be  required 
to  prepare  withholding  statements  to  be  sent  to  recipients.  Remit- 
tance to  the  Internal  Revenue  Service  of  amounts  withheld  would  be 
by  lump  sum,  without  requiring  the  listing  of  individual  paA^ees  as  is 
required  under  wage  withholding. 

Exemption  from  withholding  of  certain  payees  such  as  exempt 
organizations  and  nontaxable  individuals  would  increase  payer 
burdens.  Across-the-board  withholding  with  no  exemptions  is  there- 
fore recommended  to  make  the  task  of  payers  as  simple  and  as  inex- 
pensive as  possible.  Provision  would  be  made  in  turn  to  prevent 
hardship  due  to  overvvithholding  in  the  case  of  tax-exempt  organiza- 
tions and  individuals  not  subject  to  tax.  Tax-exempt  organizations, 
such  as  pension  trusts,  charitable  foundations,  and  educational  in- 
stitutions, would  be  allowed  to  offset  currently  the  amounts  withheld 
from  their  interest  and  dividends  against  the  amounts  they  withhold 
from  their  employees  for  income  and  social  security  tax  purposes. 
Where  these  credits  would  be  insufficient  to  provide  a  full  offset, 
quarterly  refunds  would  be  provided.  In  order  to  simplify  the  re- 
funding of  small  amounts  withheld  from  nontaxable  minors,  provision 
would  be  made  for  a  parent  of  a  dependent  minor  to  claim  credit  on 
the  parent's  annual  tax  return  for  amounts  withheld  from  the  minor, 
if  the  parent  so  wishes.  Individuals  not  subject  to  tax  (other  than 
minors)  would  be  allowed  to  claim  the  refunds  on  a  quarterly  basis. 
These  refunds  can  be  paid  promptly.  Although  withholding  state- 
ments would  not  be  used,  it  is  not  expected  that  their  absence  would 
result  in  baseless  claims  for  refunds.  An  excessive  claim  for  refund 
is  a  fraudulent  act;  this  fortunately  is  not  commonplace  among  our 
taxpayers.  Moreover,  the  Service  would  institute  a  special  audit 
enforcement  program  to  verify  the  incomes  reported  by  individuals 
claiming  refunds.  Spot  checks  of  refunds  would  be  made  by  having 
payers  confirm  the  reported  incomes  on  those  claims. 

The  adoption  of  this  practicable  system  of  withholding  on  dividends 
and  most  forms  of  interest  would,  on  the  basis  of  1959  results,  increase 
revenues  by  an  estimated  $613  million,  the  bulk  of  the  estimated  rev- 
enue loss.  For  most  dividend  and  interest  recipients,  withholding 
would  cover  the  bulk  of  their  tax  liabilities  on  such  income.  We  would 
then  be  in  a  position  to  concentrate  enforcement  efforts  on  inadequate 
tax  compliance  among  higher  bracket  taxpayers  to  insure  collection  of 
the  total  amounts  of  tax  properly  due.  The  out-of-pocket  cost  to  the 
Government  to  recoup  the  $613  million  by  withholding  is  estimated 
to  be  $18  million,  or  3  percent  of  the  revenue  gain.     Ten  million 


i 


EXHIBITS  333 

dollars  of  this  total  would  be  the  cost  of  additional  return  and  refund 
processing;  $6  million  would  be  the  cost  to  the  Treasury  for  check 
issuance  and  fiscal  service  activities  as  payer;  and  $2  million  would 
be  the  cost  of  policing  the  refund  system. 

2.    REPEAL  OF  THE  DIVIDEND  CREDIT  AND  EXCLUSION 

Under  the  law  enacted  in  1954  the  first  $50  of  dividends  may  be  ex- 
cluded from  income  and  a  credit  against  tax  of  4  percent  taken  on 
dividends  in  excess  of  this  amount.  By  providing  the  exclusion  and 
the  credit  against  tax,  it  was  intended  to  stimulate  investment  in  the 
economy  through  tax  relief  for  <iividend  income,  and  to  partially  re- 
move the  so-called  double  taxation  of  dividend  income.  In  my  view, 
the  investment  credit  is  a  much  more  direct  and  effective  method  of 
encouraging  investment.  As  an  attempt  to  coordinate  the  personal 
and  the  corporate  tax  on  dividend  income,  the  1954  technique  has 
proved  to  be  discriminatory  and  inequitable. 

Whether  there  is,  in  fact,  double  taxation  of  dividends  has  been  the 
subject  of  much  controversy.  However,  even  assuming  the  existence 
of  such  double  taxation  the  fact  remains  that  the  dividend  credit  and 
exclusion  give  a  considerably  larger  relative  reduction  in  the  burden 
of  double  taxation  to  the  dividend  recipient  with  high  income  than  to 
the  dividend  recipient  with  low  income. 

This  point  may  be  made  clear  by  considering  the  average  stock- 
holder in  a  particular  income  class.  The  corporate  tax  imposes  an 
extra  tax  burden,  over  and  above  the  personal  tax  on  dividends,  of 
52  cents  per  dollar  of  corporate  profit  before  tax  for  shareholders  not 
liable  to  income  tax,  42  cents  per  dollar  of  corporate  profits  before 
tax  for  stockholders  in  the  20  percent  tax  bracket  (for  example, 
married  couples  with  less  than  $5,000  income),  and  of  but  5  cents  per 
dollar  of  corporate  profits  on  those  with  incomes  of  over  $1  million. 
On  the  average,  the  credit  and  exclusion  combined  reduce  this  extra 
burden  by  3  cents  per  dollar  of  corporate  profit  before  tax  for  married 
couples  with  income  of  $5,000,  and  by  2  cents  for  those  with  income 
over  $1  million.  The  percentage  reduction  of  the  so-called  double 
tax  is  thus  only  8  percent  for  low  income  stockliolders,  while  it  is  41 
percent  for  high  income  stockholders.  This  deficiency  of  the  credit 
and  exclusion  has  been  noted  widely.  Surely  a  technique  as  dis- 
criminatory as  this  has  little  to  recommend  it. 

The  dividend  credit  represents  a  dead  end  approach  toward  the 
equitable  taxation  of  dividends.  In  1954  the  provisions  were  repre- 
sented as  only  a  first  step  toward  full  relief,  which  was  eventually 
to  be  achieved  by  raising  the  credit  to  15  percent  of  dividends. 
However,  it  is  not  possible  to  increase  the  credit  to  such  a  level  without 
giving  those  in  the  high  tax  brackets  reductions  exceeding  the  extra 
burdens  they  are  presumed  to  bear  as  a  result  of  the  corporate  income 
tax.  For  example,  the  tax  relief  granted  by  a  15  percent  credit 
would  amount  to  7.2  cents  per  dollar  of  corporate  earnings  before 
tax — ^or  about  25  percent  more  than  the  extra  burden  presumed  to 
fall  on  those  with  incomes  of  $250,000  because  of  the  corporate  tax. 
With  a  20  percent  credit,  which  has  been  recommended  by  some,  the 
tax  relief  at  high  income  brackets  could  be  twice  as  large  as  the 
presumed  extra  burden  of  the  corporate  tax. 


334   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Looked  at  as  straight  tax  reduction,  the  benefits  provided  by  these 
provisions  are  highly  concentrated  in  the  upper  income  groups. 
In  recent  years  less  than  9  percent  of  the  total  combined  tax  reductions 
from  the  dividend  credit  and  exclusion  have  gone  to  returns  with 
less  than  $5,000  of  income.  In  contrast,  more  than  75  percent  of 
the  total  tax  reductions  accrue  to  returns  with  incomes  of  $10,000 
and  over  and  more  than  54  percent  to  taxpayers  with  incomes  over 
$20,000.  In  view  of  the  fact  that  the  dividend  exclusion  is  frequently 
represented  as  being  helpful  to  low-income  groups,  it  is  noteworthy 
that  only  about  15  percent  of  the  total  tax  reduction  due  to  such 
exclusions  go  to  returns  with  incomes  under  $5,000.  About  55 
percent  of  its  tax  benefits  go  to  individuals  with  over  $10,000  of 
income. 

Benefits  from  the  1954  dividend  provisions  accrue  more  broadly 
at  the  higher  income  levels  because  shareholding  is  more  usual  at 
those  levels.  Only  6  percent  of  taxable  returns  with  income  under 
$5,000  have  any  dividends  at  all,  while  over  90  percent  of  returns  with 
incomes  of  over  $50,000  have  dividends.  Dividend  income  for 
returns  under  $5,000  constitutes  but  1  percent  of  total  income  of  this 
group  as  against  29  percent  for  the  higher  group.  Putting  it  dif- 
ferently, returns  with  incomes  under  $5,000,  or  40  percent  of  the 
total  number  of  taxable  returns,  report  only  about  8  percent  of  the 
dividends  included  in  tax  returns.  On  the  other  hand,  returns  with 
incomes  over  $50,000,  or  two-tenths  of  1  percent  of  all  returns, 
account  for  33  percent  of  all  dividends.  Anjnvay  one  looks  at  it, 
the  overall  benefit  of  the  dividend  credit  is  much  larger  for  the  upper 
income  groups. 

If  the  dividend  credit  and  exclusion  are  thought  of  as  methods  of 
reducing  taxes,  they  are  extremely  restricted  in  form.  Singling  out 
a  particular  type  of  income  for  such  reduction  discriminates  against 
all  other  lands  of  income  recipients  who  also  face  high  marginal  tax 
rates. 

I  am  vitally  interested  in  shaping  the  tax  structure  to  stimulate 
investment  and  growth.  When  the  dividend  credit  and  exclusion 
were  adopted  it  was  hoped  that  they  would  mduce  new  equity  issues 
from  corporations  which  would  use  the  proceeds  to  undertake  new 
investment  in  plant  and  equipment.  However,  these  provisions  have 
not  proved  effective  in  encouraging  additional  capital  investment. 
They  cannot  begin  to  compare  in  this  regard  to  the  proposed  invest- 
ment credit  which  applies  only  to  new  investment,  operates  directly 
at  the  point  where  the  decision  to  buy  plant  and  equipment  is  made, 
is  available  to  firms  whether  they  are  investing  retained  earnings  or 
outside  funds,  and  draws  no  distinction  between  incorporated  or  unin- 
corporated enterprises. 

Let  us  look  at  the  record  and  see  what  the  dividend  credit  and 
exclusion  have  done  to  increase  investment.  Although  the  number 
of  stockholders  has  increased  since  the  dividend  provisions  were 
adopted,  there  has  been  no  increase  at  all  in  the  annual  dollar  purchases 
of  equity  securities  (less  sales)  by  individuals.  In  both  1951  and 
1952  when  dividends  received  no  relief  the  net  purchases  of  stock  by 
individuals  were  higher  than  in  an}^  other  year  in  the  past  decade.  In 
recent  years,  net  stock  purchases  by  individuals  have  also  been  out- 
paced by  a  number  of  other  forms  of  personal  savings  such  as  time  and 


i 


EXHIBITS  335 

savings  deposits  in  banks  and  shares  in  savings  and  loan  associations. 
The  relative  importance  of  stock  issues  to  corporate  external  long- 
term  financing  from  all  som'ces  has  not  risen.  Department  of  Com- 
merce figiu-es  show  that  the  relative  importance  of  stock  issues  was 
higher  in  the  1949-51  period  than  in  later  years  of  the  past  decade, 
except  for  1959.  And,  finally,  but  not  least,  any  incentive  effect 
could  only  assist  those  large  firms  well  enough  known  to  be  able  to 
tap  the  stock  market  for  new  funds. 

According  to  estimates  by  the  New  York  Stock  Exchange,  the 
number  of  shareholders  rose  from  6.5  million  in  1952  to  12.5  million 
in  1959  and  to  15  million  in  1961.  This  is  a  healthy  course  for 
economic  democracy  to  take,  and  we  welcome  it.  However,  this 
development  does  not  require  special  tax  preferences,  and  it  is  very 
doubtful  whether  the  dividend  credit  and  exclusion  have  played  a 
major  role  in  this  respect.  A  number  of  other  factors  such  as  the 
levels  of  personal  incomes  and  savings,  corporate  profits,  dividends, 
and  stock  prices,  appear  to  have  been  far  more  important  than  the 
dividend  provisions  in  stimulating  stock  ownership. 

The  repeal  of  the  dividend  credit  and  exclusion  should  be  enacted 
promptly  so  that  the  introduction  of  withholding  on  dividend  and 
interest  income  may  benefit  from  the  resulting  simplification.  The 
revenue  gain  from  the  repeal  of  these  provisions  is  estimated  at  $450 
million  a  year. 

3.    EXPENSE    ACCOUNTS 

Turning  now  to  expense  accounts,  much  has  been  said  and  written 
about  the  abuses  in  this  area.  Abuses  through  expense  accounts  take 
a  variety  of  forms.  Tax  deductible  entertainment  allowances  fre- 
quently are  a  means  by  which  business  provides  tax-free  compensation 
to  favored  employees  or  business  associates.  The  seller  invites  the 
buyer  to  his  yacht  or  hunting  lodge,  the  buyer  may  reciprocate  with 
lavish  parties  and  nightclub  entertainment,  and  both  then  charge  it 
off  as  a  business  expense.  Some  of  this  is  done  because  of  the  business- 
man's own  desire  to  obtain  such  luxuries  tax  free;  much  of  it  is  done 
in  response  to  a  competitive  pressure  which  has  in  large  measure  been 
created  by  our  tax  law  and  not  by  the  dictates  of  business.  As  a 
result,  therefore,  there  are  few  of  the  luxuries  of  life,  such  as  vacations 
at  fancy  resorts,  club  memberships,  and  cruises  which  a  large  number 
of  taxpayers  cannot  in  some  way  deduct  on  tax  returns  as  business 
expenses.  As  the  President  stated,  the  time  has  come  when  our  tax 
laws  should  cease  to  encourage  luxury  spending  as  a  charge  on  the 
Federal  Treasury. 

I  have  here  a  four-part  document  illustrating  the  abuses  in  the 
entertainment  area.  This  document  demonstrates  that  tighter 
enforcement  of  present  law  will  not  suflSce;  corrective  legislation  is 
necessary. 

Part  One  of  this  document  summarizes  the  result  of  a  recent  audit 
by  the  Internal  Revenue  Service.  This  audit  was  undertaken  last 
September  by  the  Treasury  Department  as  a  step  in  meeting  the 
directive  of  the  Congress,  set  forth  in  the  Public  Debt  and  Tax  Rate 
Extension  Act  of  1960,  that  the  Secretary  of  the  Treasury  make  a 
report  as  soon  as  practicable  during  the  87th  Congress  on  the  progress 
of  an  enforcement  program,  initiated  by  the  Internal  Revenue  Service 


336   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

in  1960,  relating  to  expenses  for  entertainment,  travel,  yachts,  hunting 
lodges,  club  dues,  and  similar  items.  Although  this  audit  covered 
only  38,000  returns,  it  shows  that  these  returns  claimed  deductions 
totaling  $5  7  million  for  chib  dues,  $2  milHon  for  theater  tickets  and 
similar  amusements,  over  $1  milHon  for  hunting  lodges  and  fishing 
camps,  $2.6  milUon  for  yachts,  and  $11.5  milhon  for  business  gifts. 
Most  significantly,  the  audit  shows  that  only  a  small  portion  of  these 
expenses  can  be  disallowed  under  existing  law. 

The  difficulty  in  administering  present  law  is  shown  by  the  fact 
that,  even  though  most  of  the  claimed  expenditure  for  entertainment 
was  allowed  under  the  existing  generous  standards,  almost  50  percent 
of  the  returns  had  to  be  adjusted  by  Internal  Revenue  agents.  These 
adjustments  resulted  in  the  disallowance  of  $28.3  million  of  claimed 
travel  and  entertainment  expense.  In  addition,  it  was  determined 
that  $29.5  million  of  the  claimed  deductions  constituted  unreported 
income  in  the  nature  of  dividends  or  additional  compensation  to 
stockholders,  officers,  or  employees. 

Part  Two  of  the  document  consists  of  a  report  by  the  Commissioner 
of  Internal  Revenue  on  the  very  serious  problems  encountered  in 
administering  present  law  relating  to  travel  and  entertainment 
expenses. 

Part  Three  contains  a  summary  of  some  court  decisions  and  admin- 
istrative cases  illustrative  of  the  type  of  entertainment  expenditure 
which  is  deductible  under  existing  law.  As  the  introduction  to  this 
part  states,  when  judicial  decisions  permit  the  cost  of  a  safari  to 
Africa  undertaken  by  a  hunting  enthusiast  and  his  wife  to  be  deducted 
as  an  expense  for  advertising  dairy  milk,  one  cannot  expect  revenue 
agents  to  question  successfully  the  business  necessity  for  duck  hunting 
or  nightclubbing  with  business  associates. 

Part  Four  of  the  document  contains  a  compilation  of  recent  com- 
ments on  expense  accounts  and  business  gifts  appearing  in  newspapers 
and  other  periodicals.  These  comments  illustrate  the  widespread 
public  concern,  shared  by  many  in  the  business  community,  with 
expense  account  abuses. 

The  supplemental  statement  contains  detailed  proposals  for  carry- 
ing out  the  President's  recommendation  to  disallow  certain  enter- 
tainment expenses.  The  characteristic  feature  of  all  of  these  expenses 
is  that  they  confer  substantial  personal  benefits  which  are  in  large 
measure  a  substitute  for  personal  living  expenses.  Under  these 
detailed  proposals,  expenses  for  entertaining  guests  at  such  functions 
as  parties,  nightclubs,  theaters,  country  clubs  and  fishing  trips  would 
be  disallowed  in  full.  So  also  would  be  expenses  for  luxury  entertain- 
ment facilities  such  as  yachts,  hunting  lodges,  and  swimming  pools, 
as  well  as  for  such  items  as  country  club  dues.  The  cost  of  so-called 
business  gifts  would  be  disallowed  to  the  extent  it  exceeds  an  annual 
limitation  of  $10  for  each  recipient. 

Expenditures  for  food  and  beverages  generally  would  be  disallowed, 
although  several  exceptions  are  made.  One  exception  relates  to  food 
or  beverages  provided  primarily  to  emplo3'ees  on  business  premises. 
Another  exception  covers  the  cost  of  food  and  beverages  consumed 
in  the  course  of  conducting  business,  but  not  in  excess  of  a  fixed 
amount  per  day  for  each  individual  involved.  This  figure  could  be 
somewhere  in  the  range  of  $4  to  $7.     A  deduction  for  the  cost  of 


I 


EXHIBITS  337 

food  and  lodging  while  on  business  trips  would  be  limited  to  twice 
the  maximum  per  diem  rate  authorized  to  be  paid  to  Federal  em- 
ployees. At  the  present  time  this  rate  for  travel  in  the  United  States 
is  $12  per  day,  but  the  Bureau  of  the  Budget  has  recommended  to  the 
Congress  that  this  figure  be  raised  to  $15.  Therefore,  the  per  diem 
limitation  applicable  to  business  travel  would  be  $30  if  the  Congress 
accepts  the  recommendation  of  the  Bureau  of  the  Budget.  Finally, 
where  a  business  trip  is  combined  with  a  vacation,  a  portion  of  the 
cost  of  travel  to  the  business  destination  would  be  disallowed. 

I  believe  that  these  are  reahstic  recommendations  which  recognize 
the  legitimate  needs  of  business  while  at  the  same  time  eliminating 
the  lavish  expenditure  for  personal  benefit  which  has,  in  the  past, 
been  charged  off  to  the  American  taxpayer.  They  would  increase 
revenues  by  at  least  $250  million  per  year. 

4.    CAPITAL   GAINS   ON   SALE   OF   DEPRECIABLE   BUSINESS   PROPERTY 

The  President  has  recommended  that  capital  gain  treatment  be 
withdrawn  from  gains  on  the  disposition  of  depreciable  property  to 
the  extent  of  prior  depreciation  allowances.  Such  gain  reflects 
depreciation  allowances  in  excess  of  the  actual  decline  in  value  of  the 
asset  and  under  the  President's  proposal  would  be  treated  as  ordinary 
income.  Any  gain  in  excess  of  the  cost  of  the  asset  would  still  be 
treated  as  capital  gain.  This  reform  will  eliminate  an  unfair  tax 
advantage  which  the  law  today  gives  to  those  who  depreciate  prop- 
erty at  a  rate  in  excess  of  the  actual  decline  in  market  value  and  then 
proceed  to  sell  the  property,  thus,  in  effect,  converting  ordinary 
income  into  a  capital  gain.  This  reform  is  particularly  essential  at 
this  time  in  view  of  the  recommendations  to  provide  a  tax  credit  for 
new  investment  in  depreciable  property. 

Moreover,  the  proposed  withdrawal  of  capital-gain  treatment  from 
gains  on  disposition  of  depreciable  property  that  reflect  prior  deprecia- 
tion would  eliminate  much  of  the  present  tax  advantage  attaching  to 
investment  in  so-called  depreciation  shelters,  which  exist  primarily  in 
the  real  estate  area.  For  example,  during  the  fii'st  few  years  after 
acquisition  of  a  building  by  a  real  estate  syndicate,  the  total  deprecia- 
tion allowances  and  mortgage  interest  will  often  exceed  the  rental 
income,  so  that  distributions  of  income  during  this  period  are  tax 
exempt  in  the  hands  of  the  investor.  Wlien  the  distributions  sub- 
stantially cease  to  be  tax  exempt,  the  building  is  sold,  a  capital  gains 
tax  paid  on  the  gain  attributable  to  the  depreciation  allowances, 
and  another  building  is  acquired  to  provide  another  depreciation 
shelter.  Withdrawal  of  capital-gain  treatment  from  the  gain  on  sale 
of  the  building,  to  the  extent  of  prior  depreciation  allowances,  will 
substantially  eliminate  this  kind  of  tax  trafficking.  The  gain  in 
revenue  is  estimated  to  be  $200  million  per  year. 

5.    SPECIAL   TYPES    OF    INSTITUTIONS 

In  an  economy  characterized  by  a  great  variety  of  institutions,  the 
tax  law  must  attempt  as  far  as  possible  to  provide  uniform  and  non- 
discriminatory treatment  among  them.  Various  improvements  of 
this  sort  are  recommended  in  the  President's  message. 


338   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Cooperatives. — The  President  has  recommended  legislation  to  insure 
that  earnings  of  cooperatives  reflecting  business  activities  are  taxed 
either  to  the  cooperatives  or  to  the  patrons.  Under  the  recom- 
mendation, cooperatives  would  be  allowed  to  deduct  amounts  allo- 
cated in  cash  or  scrip  as  patronage  dividends  and  the  patrons  would  be 
taxable  on  the  patronage  dividends  allocated  to  them.  As  under 
present  law,  a  patronage  dividend  received  by  a  patron  with  respect 
to  purchases  by  him  of  items  for  his  personal  use  would  not  be  included 
in  his  income. 

In  1951,  Congress  enacted  legislation  which  was  intended  to  ac- 
complish just  this  result.  However,  various  court  decisions  have 
rendered  ineffective  the  congressional  intent  by  holding  certain  allo- 
cations of  patronage  dividends  to  be  nontaxable  to  the  patron,  al- 
though such  allocations  are  deductible  by  the  cooperative.  As  a 
result,  substantial  income  from  certain  cooperative  enterprises  is  not 
being  taxed  to  either  the  cooperative  or  to  its  patrons.  The  Presi- 
dent's recommendation  would,  in  essence,  fulfill  the  prior  intention  of 
Congress  and  remove  a  present  inequity  in  the  tax  law. 

The  President  also  recommended  that  the  withholding  tax  on 
dividends  and  interest  at  a  rate  of  20  percent  be  applied  to  patronage 
dividends.  This  would,  in  effect,  assure  the  average  patron  of  cash 
with  which  to  pay  the  tax  attributable  to  patronage  dividends  which 
he  receives,  since  the  20  percent  tax  paid  to  the  Government  by  the 
cooperative  will  come  from  its  funds.  The  President's  recommenda- 
tion will  result  in  a  method  of  taxation  of  cooperative  income  that  is 
fair  and  just  to  both  the  cooperatives  and  competing  businesses.  It 
is  estimated  to  raise  revenue  by  $25  to  $30  million. 

Fire  and  casualty  insurance  companies.- — -As  indicated  in  the  Presi- 
dent's message,  the  tax  provisions  applicable  to  mutual  fire  and 
casualty  insurance  companies,  originally  adopted  in  1942,  are  out- 
moded and  result  in  an  inadequate  and  inequitable  distribution  of 
tax.  Under  the  provisions  of  the  present  law,  stock  fire  and  casualty 
insurance  companies  are  taxed  essentially  like  other  corporations,  on 
the  basis  of  the  application  of  the  regular  corporate  rates  to  their 
combined  investment  and  underwriting  income.  Mutual  companies 
in  the  fire  and  casualty  insurance  field,  however,  are  generally  subject 
to  an  alternative  tax  formula  under  which  they  pay  the  regular  cor- 
porate rates  on  net  investment  income  only  or  1  percent  on  their 
gross  income,  consisting  of  the  sum  of  the  gross  investment  income  and 
net  premiums,  whichever  results  in  the  higher  tax.  Reciprocals  and 
interinsurers  are  excused  from  the  1  percent  gross  income  tax. 

We  recommend  that  legislation  be  adopted  which  would  eliminate 
the  special  provisions  now  applicable  to  mutual  and  reciprocal 
insurance  companies  and  tax  these  companies  on  the  general  cor- 
porate basis  in  essentialh''  the  same  manner  as  stock  companies.  The 
bills  introduced  in  this"  Congress  by  Mr.  Boggs  and  Mr.  Baker, 
members  of  this  committee,  to  equalize  the  taxation  of  the  various 
types  of  fire  and  casualty  insurance  companies  provide  a  sound  basis 
on  which  to  effect  current  remedial  legislation  in  this  field. 

It  is  estimated  that  the  enactment  of  legislation  along  the  line  of 
the  Boggs-Baker  bill,  effective  beginning  in  1962  would  increase 
revenues  by  about  $50  million  annually  in  the  next  few  years. 


EXHIBITS  339 

Mutual  savings  banks  and  savings  and  loan  associations. — As  the 
President  has  pointed  out: 

Some  of  the  most  important  types  of  private  savings  and  lending  institutions 
are  accorded  tax  deductible  reserve  provisions  which  substantially  reduce  or 
eliminate  their  Federal  income  tax  liability. 

The  President  has  further  stated: 

These  provisions  should  be  reviewed  with  the  aim  of  assuring  nondiscriminatory 
treatment. 

The  Treasury  Department  in  cooperation  with  other  interested  Gov- 
ernment agencies  is  now  intensively  reviewing  these  provisions  in 
order  to  develop  specific  recommendations  in  accordance  with  the 
President's  message.  As  soon  as  this  review  is  completed,  which  we 
expect  to  be  done  sometime  in  June,  we  will  present  our  recommenda- 
tions to  the  Congress. 

IV.  Further  Recommendations 

I  now  turn  to  a  final  set  of  recommendations,  including  tax  rate 
extension,  taxation  of  aviation  fuel,  and  taxpayer  account  numbers. 

Tax  rate  extension. — The  President,  in  his  tax  message,  recom- 
mended an  extension  of  present  corporation  income  and  excise  tax 
rates  otherwise  scheduled  for  reduction  or  termination  on  July  1,  1961. 
In  the  absence  of  this  legislation,  the  corporate  tax  rate  would  be 
decreased  5  percentage  points  from  52  percent  to  47  percent,  excise 
tax  rates  on  distilled  spirits,  beer,  wines,  cigarettes,  passenger  auto- 
mobiles, automobile  parts  and  accessories,  and  the  transportation  of 
persons  would  also  decline;  and  the  excise  tax  on  general  telephone 
service  would  expire. 

These  scheduled  reductions  in  corporate  taxes  and  excise  taxes  would 
cause  a  revenue  loss  of  about  $2.6  billion  in  fiscal  year  1962  and  a  full 
year  revenue  loss  of  $3.6  billion.  Since  we  are  already  facing  a  deficit 
in  fiscal  1962  this  is  entirely  unacceptable.  It  is  essential  that  these 
rates  be  extended  promptly  to  maintain  intact  the  revenue  producing 
power  of  oiu"  tax  system,  to  prevent  an  increase  in  the  budget  deficit, 
and  to  avoid  prejudging  next  year's  overall  tax  reform. 

Aviation  Juel. — The  President  has  recommended  (1)  extending  the 
present  net  2-cent  rate  on  aviation  gasoline  to  jet  fuels;  (2)  holding 
this  uniform  rate  covering  both  types  of  fuel  at  the  2-cent  level  for 
fiscal  1962;  and  (3)  providing  for  annual  increments  in  this  rate  of 
one-half  cent  after  the  fiscal  year  1962,  until  the  portion  of  the  cost 
of  the  airways  properly  allocable  to  civil  aviation  is  substantially  re- 
covered by  this  tax. 

The  immediate  increase  in  revenue  from  this  proposal  wUl  be  modest 
in  comparison  with  anticipated  airway  cost;  and  the  annual  gradation 
of  further  increases  is  intended  to  moderate  the  impact  of  the  tax  on 
the  air  carrier  industry. 

The  inclusion  of  jet  fuel  in  the  tax  base,  along  with  aviation  gaso- 
line, is  clearly  in  order  and  is  estimated  to  almost  triple  the  revenue 
from  aviation  fuel.  As  air  travel  increases  through  the  introduction 
of  modern  jet  aircraft,  revenues  from  the  aviation  fuel  tax  are  declin- 
ing, from  $29  million  in  fiscal  year  1960  to  an  estimated  $17  million 
in  fiscal  year  1962.     This  is  a  topsy-turvy  situation  which  must  be 


340   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

corrected.  If  the  tax  were  extended  to  jet  fuel  at  the  2-cent  rate, 
revenues  in  fiscal  year  1962  would  increase  by  $28  million  to  a  total  of 
$45  million.  In  view  of  the  rapid  transition  to  jet  aircraft,  the  taxa- 
tion of  jet  fuel  is  essential  if  the  aviation  industry  is  to  contribute 
anywhere  near  its  proper  share  to  the  cost  of  improving  and  operating 
the  Federal  airways  system.  Further,  since  the  revenue  from  aviation 
fuel  is  considered  a  user  charge  for  airways,  the  revenue  from  aviation 
fuel  now  going  to  the  highway  trust  fund  should  be  retained  in  the 
general  fund  of  the  Treasury.  Representatives  of  the  Federal  avia- 
tion authority  are  available  to  discuss  this  recommendation  in  detail 

Taxpayer  account  numbers. — The  President  has  recommended  that 
legislation  should  be  enacted  to  authorize  the  use  of  taxpaj^er  account 
numbers  beginning  January  1,  1962,  to  identify  taxpayer  accounts 
throughout  the  processing  and  recordkeeping  operations  of  the  Inter- 
nal Revenue  Service.  This  legislation  would  require  the  use  of  iden- 
tifying numbers  for  persons  filing  tax  returns  and  other  documents. 
It  would  also  specify  that  such  identifying  numbers  must  be  furnished 
to  other  persons  who  are  required  to  file  various  tax  documents. 

The  assignment  of  an  account  number  to  each  taxpayer  is  indis- 
pensable to  the  effective  operation  of  the  system  of  automatic  data 
processing  which  the  Internal  Revenue  Service  is  now  establishing. 
It  is  generally  recognized  that  such  a  system  utilizing  modern  mechani- 
cal methods  of  collecting  and  processing  tax  data  is  essential  to  a  con- 
tinued effective  collection  and  enforcement  program.  A  pilot  process- 
ing installation  located  in  Atlanta,  Ga.,  encompassing  the  seven 
Southeastern  States,  is  scheduled  to  begin  operation  in  January  of 
1962.     The  need  for  identifying  numbers  is  therefore  apparent. 

The  proposed  coordination  of  account  number  assignment  with  the 
existing  social  security  numbering  system  will  substantially  alleviate 
any  possible  burden  on  taxpayers.  Moreover,  substantial  flexibility 
in  the  requirements  for  using  identifying  numbers  has  been  incorpo- 
rated in  the  proposed  legislation  in  order  to  permit  the  special  problems 
of  taxpayers  in  connection  with  information  returns  to  be  taken  into 
account. 

CONCLUSION 

In  concluding,  let  me  repeat  what  I  believe  should  be  the  basic 
principles  underlying  our  tax  policy  this  year  and  next.  We  must 
conserve  and  strengthen  the  revenue-producing  power  of  our  tax  sys- 
tem so  that  its  proceeds  will  be  adequate  to  meet  the  needs  of  Govern- 
ment in  these  crucial  years.  We  must  adapt  the  tax  structure  to  the 
requirements  of  a  healthy  economy,  an  economy  that  makes  full  use  of 
its  resources,  provides  relative  stability  of  prices,  and  which  generates 
a  steadily  rising  level  of  income,  contributing  thereb,y  to  its  role  in  an 
expanding  world  economy.  Finall.y,  we  must  improve  tlie  equity  of 
our  tax  structure  so  as  to  assure  that  all  Americans  contribute  their 
fair  and  proper  share  to  the  cost  of  their  Government.  If  these  things 
are  done,  the  tax  system  will  be  a  powerful  positive  force  in  the  working 
of  our  econom}^  and  in  the  life  of  our  Nation.  I  propose  to  strive  with 
you  to  make  it  such. 


EXHIBITS  341 

Exhibit  14. — Statement  by  Secretary  of  the  Treasury  Dillon,  March  14,  1961, 
before  the  House  Committee  on  Ways  and  Means  on  financing  the  Federal 
highway  program 

The  transportation  potential  of  the  Federal  highway  program's  network  of 
roads — its  contribution  to  the  economic,  agricultural,  and  industrial  growth  of  the 
Nation,  as  well  as  to  its  security — is  clearly  visible.  We  have  tlie  engineers, 
machinery,  and  manpower  to  carry  out  the  program  easily  within  the  time  limit 
contemplated.  Furthermore,  highway  construction  is  making  a  positive  contribu- 
tion at  this  moment  by  putting  underemployed  manpower  and  machinery  to  work. 

However,  as  President  Kennedy  said  in  his  message  of  February  28,  the  pay- 
as-you-go  Federal  highway  program  is  in  trouble. 

Five  years  have  now  passed  since  it  was  decided  to  complete  the  previously 
planned  interstate  system.  We  now  see  clearly  that  considerably  more  money 
than  was  first  anticipated  must  be  raised  to  pay  for  the  system  if  it  is  to  be 
finished  in  the  early  1970's  as  scheduled. 

The  highway  trust  fund  will  need  an  additional  $9.7  billion  by  1972  to  meet  the 
anticipated  extra  costs,  and  $12.2  billion  if  the  presently  scheduled  diversion  for 
fiscal  1962-64  of  revenues  from  the  general  fund  of  the  Treasury  is  rescinded. 

Let  us  take  a  look  at  the  situation  facing  us  in  the  next  few  years  in  order  to  put 
these  figures  in  better  perspective: 

Highway  aid  involves  planning  and  apportionments  to  States  far  in  advance  of 
the  time  the  funds  are  actually  spent.  For  this  reason.  State  apportionments  will 
be  made  this  summer  for  the  fiscal  year  1963.  Under  present  law,  authorizations 
for  both  fiscal  1963  and  1964  for  the  interstate  system  are  set  at  $2.2  billion. 

Because  of  estimated  shortages  of  trust  fund  revenues  under  present  law,  how- 
ever, it  now  appears  that  apportionments  to  States  for  fiscal  1963  can  only  be 
$2  billion,  and  for  fiscal  1964,  $1.5  billion.  Thereafter,  under  present  law, 
revenues  would  permit  apportionments  to  rise  slowly  to  a  maximum  of  $1.9  billion 
in  1968,  compared  to  an  estimated  requirement  in  that  year  of  $3  billion. 

Under  present  law,  diversions  from  the  general  fund  to  the  trust  fund  amounting 
to  $2.5  billion  are  scheduled  during  the  fiscal  years  1962-64. 

President  Kennedy,  just  as  President  Eisenhower  before  him,  has  requested 
that  this  diversion  not  be  permitted  to  occur.  Instead,  both  have  supported  the 
1956  decision  for  financing  the  highway  trust  fund.  The  original  legislation 
setting  up  the  highway  trust  fund  represented  a  decision  that  some,  but  not  all, 
revenues  from  excises  on  automotive  products  be  used  for  highway  purposes. 

At  this  point  it  is  important  to  remember  that  when  the  new  Federal  highway 
program  was  set  up,  it  was  well  understood  that  the  Federal  Government  would 
have  to  spend  considerably  more  on  highway  aid  than  the  equivalent  of  receipts 
then  being  obtained  from  the  gasoline  tax  alone.  Thus,  in  making  the  1956  pro- 
gram possible.  Congress  decided:  To  impose  a  few  new  automotive  taxes,  tread 
rubber  and  the  truck  weight  tax;  to  increase  the  rates  on  others,  motor  fuels,  high- 
way tires,  sales  of  trucks;  and  to  use  the  resulting  additional  revenues,  plus  most 
of  the  then  existing  revenues  from  these  sources,  for  highway  aid. 

Other  revenues  from  these  and  from  other  automotive  products  were  retained  as 
general  revenue  sources. 

To  reverse  the  1956  decision  would  be  highly  undesirable.  It  would  represent 
an  attempt  to  avoid  admitting  that  the  highway  program  is  costing  more  money 
than  estimated.  More  revenues  are  required.  Diverting  moneys  from  the  general 
fund  for  highway  aid  would  reduce  revenues  required  for  other  needs  of  the  Govern- 
ment, around  which  other  important  programs  have  been  built.  This  would 
not  solve  the  problem.  It  would  merely  transfer  it  to  another  portion  of  the  over- 
all Federal  budget. 

To  use  some  of  the  previously  expected  general  fund  revenues  for  highways 
would  be  tantamount  to  making  one  of  these  assumptions:  That  highway  building 
should  replace  some  planned  expenditures  for  defense,  aid  to  farmers,  aid  to 
veterans,  etc.;  or,  that  these  latter  functions  should  be  carried  on  as  planned  by 
increasing  the  taxes  used  for  general  fund  purposes;  or,  finally,  that  highway 
building  should  be  financed  by  deficits. 

I  am  sure  it  is  not  intended  to  use  diversions  from  the  general  fund  for  highway 
financing  as  a  means  of  reducing  other  governmental  programs.  On  the  other 
hand,  I  am  not  aware  of  any  interest  in  increasing  other  taxes  to  offset  the  loss  to 
the  general  fund  of  any  diversion  to  the  highway  trust  fund.  Consequently,  it  is 
most  likely  that  diversion  will  in  fact  mean  the  use  of  deficit  financing  to  build  our 


342 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


highways.  Financing  the  highway  program  by  increasing  the  level  of  the  general 
Federal  debt  may  make  it  difficult  to  measure  the  cost  of  bond  financing,  but  the 
cost  is  still  there. 

A  special  bond  issue  to  finance  the  interstate  system  was  proposed  to  the  Con- 
gress in  1955.  The  Congress  considered  the  interest  cost  disadvantages  of  bonds 
and  decided  on  a  pay-as-you-build  approach. 

I  think  that  decision  is  just  as  sound  today  as  it  was  in  1955. 

The  magnitude  of  interest  costs,  if  we  were  to  take  this  route  toward  completing 
the  Federal  liighway  program,  would  be  heavy  indeed.  The  President  said  in  his 
message  that  a  special  highway  bond  program  to  finish  the  interstate  system  as 
now  planned  would  cost  $6.6  billion  in  interest.  This  figure  was  based  upon 
three  assumptions:  One,  a  4  percent  interest  rate;  two,  reduction  of  the  motor  fuel 
tax  to  3  cents  per  gallon  on  July  1,  1961;  three,  repeal  of  the  now  scheduled  diver- 
sion for  fiscal  1962-64  of  the  equivalent  of  a  5  percent  tax  on  passenger  automobiles 
and  parts  and  accessories.  The  highway  trust  fund  would  have  to  be  kept  in 
being  through  most  of  fiscal  1981  to  retire  the  bonds  which  would  amount  to  over 
$16  billion  at  their  maximum.  Financing  the  highway  cost  through  regular 
Federal  debt  issues  could  reduce  the  interest  estimate  somewhat,  but  there  would 
still  be  billions  of  interest  costs — dollars  that  build  no  roads. 

The  President  has  definitely  stated  that  he  believes  deficitf financing  for  the 
Federal  highway  program  would  be  an  unwise  decision  and  that  the  amendment 
to  section  209  of  the  Highway  Revenue  Act  of  1956  limiting  highway  aid  appor- 
tionments to  estimated  trust  fund  revenues  should  be  continued  in  force.  The 
President  is  pledged,  "barring  a  worsening  economy,  to  submit  to  the  Congress 
programs  (aside  from  any  new  defense  outlays)  which  of  and  by  themselves  will 
not  unbalance  the  budget  previously  submitted."  To  finance  the  highway  pro- 
gram by  diverting  revenues  now  going  to  the  general  fund  from  the  tax  on  pas- 
senger automobiles  and  parts  and  accessories  would  constitute  a  deliberate 
unbalancing  of  the  budget.  As  the  President  said,  "This  is  a  decision  which, 
if  it  is  taken  at  all,  should  be  taken  on  its  merits,  in  relation  to  the  state  of  the 
economy  and  the  budget  as  a  whole,  not  as  an  accidental  by-product  of  the 
highway  program." 

With  these  considerations  in  mind,  and  after  reviewing  possible  methods  of 
financing,  the  President  decided  that  it  would  be  preferable  to  raise  additional 
revenues  from  the  excises  which  have  previously  been  earmarked  to  support  the 
highway  program.  As  you  remember,  he  made  alternative  suggestions  in  this 
respect. 

His  first  preference  was  the  retention  of  the  present  four  cents  per  gallon  tax 
on  gasoline,  rather  than  allowing  it  to  be  reduced  to  three  cents  on  July  1  as 
scheduled  under  present  law.  As  part  of  this  program,  he  recommended  increases 
in  certain  other  taxes  as  follows: 


Tax  base 


Present 
rate 


Rate  as  of 

July  1 

under 

present 

law 


Rate  pro- 
posed by 

the 
President 


Diesel  fuel  and  special  motor  fuel 
Trucks  and  buses  over  26,000  Ibs. 

Highway  tires 

Inner  tubes 

Tread  rubber 


gallon 

1,000  lbs.  of  gross  weight 

pound.. 

pound 

pound 


4(S 
$1.50 


$1.  50 


H 


$5. 00 

m 


His  alternative  suggestion,  which  also  was  the  recommendation  of  the  previous 
administration,  was  to  increase  the  tax  on  motor  fuels  to  4}^  cents  a  gallon,  but 
without  other  tax  increases. 

To  obtain  a  full  perspective  of  the  increases  proposed  bj^  the  President,  as 
compared  with  present  highway  trust  fund  tax  rates,  I  refer  you  to  the  table 
attached  to  my  statement. 

While  either  of  these  alternative  programs  would  raise  approximately  $900 
million  a  year  at  present  levels  of  consumption,  the  first — which  is  the  President's 
preference — would  shift  a  considerable  part  of  the  increase  on  to  heavier  trucks 
using  diesel  fuel,  rather  than  on  to  motorists  in  general.  The  desirability  of 
such  a  shift  of  the  tax  burden  is  clearly  borne  out  by  various  State  and  Federal 


EXHIBITS 


343 


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344   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

studies.  The  shift  would  assign  to  heavier  trucks  a  more  reasonable  share  of 
the  highway  building  costs  attributable  to  them.  For  its  part,  the  Treasury- 
would  consider  either  alternative  to  be  financiallj^  satisfactory  because  both  meet 
the  need  to  finance  the  highway  program  from  additional  revenues. 

I  should  point  out  that  both  alternatives  appear  to  leave  a  shortfall  of  about 
$1  billion  by  the  end  of  fiscal  1972  relative  to  present  estimated  financing  needs. 
Since  this  is  about  2  percent  of  total  revenues  over  the  life  of  the  fund,  it  should 
permit  the  taxes  to  end  before  the  close  of  the  calendar  year  1972.  We  are 
dealing  with  revenue  and  expenditure  estimates  up  to  a  decade  in  the  future,  so 
there  will  be  ample  time  in  the  future  to  take  care  of  such  minor  adjustments. 

Of  course  the  additional  taxes  of  about  $900  million  that  the  President  has 
recommended  mean  additional  burdens  which  in  all  fairness  must  be  justified. 
The  highway  program  benefits  most  specifically  the  automotive  users  of  the  roads. 
Federal  aid  to  roads  came  into  being  because  of  the  development  of  the  auto- 
mobile and  truck,  and  federaUy  aided  roads  are  designed  and  built  for  automotive 
traffic  needs.  Since  highways  built  with  Federal  aid  exist  because  of  the  need 
for  motor  roads  and  would  not  exist  except  for  motor  travel,  the  additional 
revenue  should  come  from  motor  vehicles. 

Let  me  say  a  final  few  words  regarding  one  further  item  mentioned  by  the 
President:  the  use  of  receipts  from  the  2  cents  per  gallon  tax  on  aviation  gasoline. 
These  receipts,  about  $22  million  in  fiscal  1962,  are  now  transferred  to  tlie  high- 
way trust  fund.  The  President  recommended  that  in  the  future  aviation  gasoline 
receipts  be  retained  in  the  general  fund  of  the  Treasury. 

Aircraft  operators  use  a  Federal  airways  system  which  provides  services  that 
may  be  compared  with  the  Federal  highway  system.  Federal  costs  for  operating 
and  improving  the  airways  system  (excluding  airport  grants  and  weather  and 
other  indirect  services)  now  approach  $600  million  a  year.  Under  the  circum- 
stances, it  is  inconsistent  to  use  the  revenues  derived  from  aviation  gasoline  to 
help  build  highways. 

President  Kennedy's  proposal  with  respect  to  aviation  gasoline  revenues  did 
not  include  any  recommendations  as  to  an  increase  in  the  level  of  taxation  of 
aviation  gasoline  or  the  taxing  of  jet  fuel,  which  is  now  free  of  tax.  We  believe, 
along  with  the  previous  administration,  that  these  products  should  make  a  greater 
contribution  to  Federal  revenues  in  view  of  the  heavy  Federal  expenditures  for 
airways.  However,  we  have  not  finished  our  analysis  of  the  situation  and,  there- 
fore, are  not  making  any  suggestions  for  change  at  this  time. 

To  sum  up,  I  believe  that  we  have  got  to  keep  our  Federal  highway  program 
moving  ahead— and  that  we  should  do  so  on  a  pay-as-you-build  basis. 


ExraBiT  15. — Statement  by  Assistant  Secretary  of  the  Treasury  Surrey,  July  25, 
1961,  before  the  Senate  Finance  Committee  on  H.R.  10,  to  encourage  the 
establishment  of  voluntary  pension  plans  by  self-employed  individuals 

The  Treasury  Department  welcomes  this  opportunity  to  present  its  views  on 
H.R.  10,  "To  encourage  the  establishment  of  voluntary  pension  plans  by  self- 
employed  individuals."  The  problem  with  which  this  iDill  is  concerned,  how  to 
treat  the  retirement  savings  of  the  self-employed  for  tax  purposes,  is  an 
important  one. 

The  objective  of  H.R.  10  is  to  give  self-employed  people  a  tax  postponement 
advantage  for  income  set  aside  in  qualified  pension  plans  generally  comparable 
to  that  now  received  by  employees  covered  by  such  plans  who  now  are  not 
required  to  include  their  employer's  pension  contributions  currently  in  their 
taxable  income.  Under  the  bill,  self-employed  people  covered  by  pension  plans 
meeting  the  requirements  described  below  would  be  allowed  income  tax  deduc- 
tions, within  certain  limits,  for  pension  contributions  made  on  their  own  behalf. 
In  general,  the  income  set  aside  in  such  pension  plans  would  remain  free  of  tax 
until  received  by  the  individual,  when  it  would  be  included  in  income  for  tax 
purposes.  In  addition,  the  earnings  on  the  income  so  set  aside  would  likewise  be 
exempt  from  tax  prior  to  withdrawal.  Since  income  tends  to  decline  in  the 
retirement  years  and  older  people  receive  favored  tax  treatment  under  a  number 
of  provisions,  the  deferment  of  tax  from  the  time  when  the  self-employed  individual 
makes  the  pension  contributions  until  the  time  he  receives  the  pension  benefits 
would  shift  income  to  lower  income  tax  brackets.  In  addition  to  reducing  taxes, 
the  postponement  of  the  time  when  tax  is  payable,  both  as  respects  the  amounts 


t 


EXHIBITS  345 

set  aside  and  the  earnings  on  such  amounts,  would  provide  substantial  interest 
savings  to  covered  self-employed  individuals  by  allowing  them  to  retain  the 
use  of  funds  for  a  longer  period  of  time. 

Principal  features  of  H,R.  10 

Under  this  bill,  self-employed  people  (including  partners)  would  be  allowed 
to  be  covered  by  qualified  pension  plans.  Individuals  would  be  considered  self- 
employed  for  this  purpose  if  they  own  more  than  a  10  percent  interest  in  the 
business.  In  general,  individuals  who  have  an  interest  in  the  business  which 
does  not  exceed  10  percent  would  be  treated  as  employees  for  pension  purposes. 

Self-employed  people  with  fewer  than  four  employees  would  be  allowed  to 
establish  pension  plans  for  themselves  without  making  any  provision  for  the 
retirement  needs  of  their  employees.  In  such  cases,  a  self-employed  individual 
would  be  permitted  to  contribute  and  deduct  contributions  for  hiinself  up  to  10 
percent  of  his  self-employment  income  with  a  maximum  of  $2,500  a  year.  Since 
self-employment  income  represents  the  entire  net  income  from  a  trade"  or  business, 
the  tax  deductions  of  the  self-employed  people  would  be  based  on  income  attribut- 
able to  capital  invested  in  the  business  as  well  as  on  income  from  personal  services. 

Self-employed  individuals  with  four  or  more  employees  would  have  to  cover 
their  employees  under  the  ciualified  pension  plan  in  order  to  secure  coverage  in 
the  plan  for  themselves.  In  such  cases,  the  pension  plan  would  be  required  to 
cover  all  employees,  other  than  part-time  and  seasonal  employees,  who  have  at 
least  three  years  of  service.  The  covered  employees  would  have  to  be  given 
nonforfeitable  rights  to  the  contributions  made  for  them. 

Where  the  self-employed  individuals  qualify  as  having  four  or  more  employees, 
the  contributions  on  their  own  behalf  would  not  be  limited  to  the  10  percent — 
$2,500  allowance.  In  such  cases  a  self-employed  individual  would  be  permitted 
to  contribute  and  deduct  for  himself  any  amount  without  limit  except  that  the 
ratio  of  his  contributions  for  himself  to  his  self-employment  income  could  not 
exceed  the  ratio  of  contributions  to  earnings  of  any  of  his  covered  employees.  If 
the  self-employed  individual's  deductible  contributions  for  himself  did  not  exceed 
one-third  of  the  total  deductible  contributions,  the  plan  could  be  coordinated 
with  the  social  security  system  by  treating  the  employer's  actual  social  security 
contributions  for  himself  and  his  employees  as  if  they  were  made  under  the 
private  plan  for  purposes  of  determining  whether  the  ratio  test  is  met.  Once  a 
self-employed  individual  qualified  as  having  four  or  more  employees  in  any  year 
his  deductible  contributions  for  himself  would  no  longer  be  limited  to  the  10 
percent — $2,500  allowance,  even  though  his  employees  drop  below  this  number  in 
any  subsequent  year. 

Except  in  the  event  of  severe  disability  or  death,  benefits  for  self-employed 
individuals  would  not  be  payable  before  the  age  of  59^^  and  would  have  to  begin 
before  the  age  70^/1  The  retirement  benefits  received  from  the  plans  by  the 
self-employed  individuals  would  be  taxable  as  ordinary  income.  Averaging 
treatment  would  be  accorded  lump-sum  distributions.  In  general,  the  tax  on 
such  distributions  received  after  age  59}^  would  be  equal  to  five  times  the  increase 
in  tax  resulting  from  including  in  income  one-fifth  of  the  distribution.  Except 
in  case  of  disability,  distributions  of  $2,500  or  more  to  self-employed  people 
prior  to  age  59)i  would  be  taxed  at  not  less  than  110  percent  of  the  liability  result- 
ing from  spreading  the  distribution  over  the  taxable  year  and  the  preceding  four 
years. 

Retirement  funds  could  be  invested  with  a  bank  as  trustee  or  used  to  purchase 
retirement  annuities  from  an  insurance  coiripany  or  face  amount  certificates. 
Custodial  accounts  could  also  be  set  up  with  banks  if  the  investment  is  solely  in 
regulated  investment  company  stock.  In  addition,  the  self-employed  indi\'idual 
could  purchase  and  distribute  to  his  employees  in  the  plan  a  special  nontransferable 
U.S.  bond  redeemable  after  age  59)^  or  disability. 

The  bill  would  be  effective  for  taxable  years  beginning  after  December  31,  1961. 

Problems  raised  by  H.R.  10 

The  Treasury  Department  recognizes  that  the  present  law  does  not  give  self- 
employed  people  tax  treatment  for  their  retirement  savings  comparable  to  that 
now  accorded  to  employees  covered  by  employer  financed  pension  plans.  How- 
ever, H.R.  10  as  passed  by  the  House  does  not  provide  a  satisfactory   solution. 


346    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

If  it  is  to  be  effective  in  achieving  its  objective,  any  legislation  designed  to 
achieve  comparable  tax  advantages  for  self-employed  people  under  pension  plans 
should  at  least  have  the  following  attributes: 

(1)  It  should  at  least  grant  approximately  the  same  tax  treatment  under  pen- 
sion plans  to  self-employed  people  and  corporate  owner-managers.  Since  the 
principal  justification  for  granting  tax  advantages  for  the  retirement  savings  of  the 
self-employed  is  that  they  are  not  given  the  pension  advantages  now  received  by 
corporate  owners,  any  legislation  which  results  in  treating  these  groups  in  a  mark- 
edly different  fashion  would  merely  represent  a  temporary  expedient  and  not  a 
lasting  solution.  Moreover,  if  corporate  owner-managers  retain  important  tax 
advantages  over  the  self-employed  individuals  for  pension  purposes  an  artificial 
tax  incentive  would  remain  for  self-employed  people  to  change  their  businesses  to 
the  corporate  form  wherever  possible  in  order  to  secure  greater  pension  advantages. 
Self-employed  individuals  who  now  cannot  incorporate  would  also  continue  to 
seek  State  legislation  permitting  them  to  do  so. 

(2)  To  prevent  the  use  of  pension  plans  to  secure  undue  advantages,  there  should 
at  least  be  appropriate  limitations  on  the  pension  contributions  made  for  self- 
employed  people  and  corporate  owner-managers.  At  present,  despite  the  non- 
discrimination requirements  imposed  by  the  law  on  qualified  plans,  it  is  difficult  to 
check  abuses  which  arise  when  owner-managers  of  closely  held  corporations  estab- 
lish pension  plans  primarily  for  their  own  benefit.  In  some  cases,  for  example,  the 
contributions  under  the  plan  may  be  used  mainly  to  provide  substantial  benefits  to 
the  owner-managers,  and  other  employees  may  receive  only  nominal  benefits 
or  none  at  all.  For  example,  a  plan  covering  only  salaried  employees,  which  is 
within  the  purview  of  section  401(a)  (5)  of  the  Internal  Revenue  Code,  could  result 
in  the  coverage  of  the  owner-managers  to  the  exclusion  of  all  other  employees. 
Any  legislation  allowing  self-employed  people  to  be  covered  by  qualified  plans 
should  not  create  problems  of  this  type  for  plans  covering  self-employed  people, 
but  instead  should  contain  appropriate  provisions  eliminating  these  abuses  where 
they  now  exist. 

(3)  In  seeking  to  remove  discrimination  against  self-employed  people,  the  legis- 
lation should  not  grant  them  coverage  under  pension  plans  under  such  conditions 
as  would  create  a  counter  discrimination  against  their  employees.  Historically, 
the  objective  of  granting  favored  tax  treatment  to  qualified  pension  plans  has  been 
to  encourage  the  establishment  of  plans  to  meet  the  retirement  needs  of  employees. 
In  order  to  achieve  this  objective,  the  Internal  Revenue  Code  contains  an  entire 
set  of  provisions  which  were  designed  to  confine  the  special  tax  treatment  to  plans 
which  do  not  discriminate  as  to  coverage  or  benefits  in  favor  of  owner-managers 
and  highly  paid  employees  as  compared  with  the  rank  and  file  of  employees.  In 
view  of  this  background  it  is  especially  important  that  any  legislation  in  this  field 
should  require  self-employed  individuals  securing  pension  coverage  for  themselves 
to  provide  comparable  coverage  for  their  employees  without  any  arbitrary  ex- 
clusion of  certain  groups  of  employees. 

H.R.  10  does  not  meet  these  requirements.  Its  adoption  would  create  new 
serious  discriminations  to  replace  the  problems  that  it  seeks  to  solve  by  allowing 
self-employed  people  to  be  covered  by  qualified  pension  plans.  It  would  result 
in  very  substantial  differences  in  tax  treatment  for  pension  purposes  not  only  for 
self-employed  individuals  as  compared  with  owner-managers  of  corporations  and 
for  self-employed  people  as  compared  with  their  employees,  but  also  among  self- 
employed  people  themselves. 

In  some  situations  self-employed  individuals  would  receive  more  favorable 
treatment  than  corporate  owner-managers;  in  other  situations  the  reverse  would  be 
true.  For  example,  where  there  are  no  employees  other  than  the  owner,  corporate 
owner-managers  would  receive  more  favorable  treatment  than  the  self-employed. 
In  such  cases,  H.R.  10  limits  the  amounts  that  a  self-employed  individual  can 
contribute  on  his  own  behalf  to  10  percent  of  his  self-employment  income  or  $2,500 
a  year.  In  contrast,  in  accordance  with  the  present  provisions  of  the  Code, 
nondiscriminatory  contributions  to  qualified  pension  plans  on  behalf  of  corporate 
owner-managers  would  not  be  subject  to  any  specific  dollar  limit. 

On  the  other  hand,  where  there  are  from  one  to  three  employees,  H.R.  10  would 
allow  self-employed  individuals  to  secure  pension  coverage  for  themselves  without 
making  any  provision  for  the  retirement  needs  of  their  employees.  Under  present 
law,  the  owner-manager  of  a  corporation  does  not  have  a  comparable  privilege. 
In  order  to  secure  pension  coverage  for  himself  he  would  have  to  establish  a  non- 
discriminatory plan  which  could  not  automatically  exclude  all  other  employees 
though  it  could  exclude  employees  on  the  basis  of  a  nondiscriminatory  classifi- 


EXHIBITS  347 

cation  and  seasonal  and  part-time  employees  as  well  as  those  with  not  more  than 
five  years  of  service. 

Where  there  are  four  or  more  employees  besides  the  owner,  both  the  self-em- 
ployed individual  and  the  corporate  owner-manager  would  be  required  to  extend 
coverage  under  the  plan  to  their  employees  in  order  to  be  covered  themselves. 
However,  in  such  cases,  there  would  be  important  dififerences  in  the  qualification 
rules  for  the  plans  established  by  self-employed  persons  and  plans  established  by 
corporations  in  regard  to  the  conditions  under  which  employees  would  have  to  be 
covered,  the  rights  that  employees  would  have  to  contributions  made  on  their 
behalf,  and  the  method  of  coordinating  the  private  pension  plan  with  the  social 
security  system. 

Besides  failing  to  produce  the  same  tax  treatment  for  self-employed  individuals 
and  corporate  owner-managers  under  pension  plans,  H.R.  10  discriminates  against 
employees  when  it  allows  self-employed  individuals  with  fewer  than  four  em- 
ployees to  secure  coverage  in  qualified  plans  for  themselves  without  making  any 
provision  for  the  retirement  needs  of  their  employees.  There  is  no  logical  basis 
for  such  an  arbitrary  exclusion  of  employees  from  the  benefits  of  the  pension 
plans  covering  the  self-employed.  Since  self-employed  individuals  very  fre- 
quently have  less  than  four  employees,  the  practical  ett'ect  of  the  exclusion  would 
be  to  deprive  a  large  number  of  employees  of  the  benefits  of  the  new  pension 
plans  that  would  be  established  under  the  bill. 

There  also  are  not  adequate  safeguards  to  check  abuses  in  contributions  for 
self-employed  people  with  more  than  four  employees.  Under  H.R.  10,  such  in- 
dividuals would  be  permitted  to  make  pension  contributions  for  themselves 
exceeding  the  10  percent — $2,500  limit,  presumably  on  the  theory  that  they 
would  have  to  grant  coverage  to  such  employees  and  make  substantial  contribu- 
tions for  them.  However,  since  the  contributions  to  the  plan  would  be  based  on 
the  self-employment  income  of  the  owner,  including  income  from  capital  invested 
in  the  business,  and  the  compensation  of  the  employees,  the  bulk  of  such  contri- 
butions would  be  made  for  the  owner  in  those  cases  where  employees  earn  modest 
salaries  and  the  owner's  self-employment  income  is  large.  In  such  cases,  the 
immediate  tax  reduction  received  by  the  self-employed  individuals  as  a  result  of 
the  deduction  for  his  own  contribution  could  greatly  exceed  the  contribution 
made  for  his  employees.  Though  some  part  of  this  tax  reduction  might  be  offset 
by  the  tax  resulting  in  later  years  when  the  pension  is  received  and  included  in 
taxable  income,  the  net  tax  benefits  to  such  a  self-employed  individual  would 
generally  be  substantial. 

Self-employed  individuals  having  once  qualified  for  the  larger  allowances  as 
employers  of  four  or  more  individuals,  can  continue  to  contribute  amounts  in 
excess  of  the  10  percent — $2,500  limit  in  subsequent  years  even  if  they  have  no 
employees  in  such  years.  Also,  because  the  bill  specifically  permits  a  self-em- 
ployed individual  to  exclude  from  the  plan  employees  who  have  less  than  three 
years  of  service  and  at  the  same  time  to  count  them  in  determining  whether  he 
has  at  least  four  employees,  it  would  be  possible  for  the  self-employed  individual 
to  contribute  for  himself  more  than  the  basic  10  percent — $2,500  amounts  with- 
out making  any  contributions  on  behalf  of  any  other  individual.  As  a  result, 
some  self-employed  people  would  be  able  to  deduct  annual  contributions 
substantially  exceeding  $2,500  indefinitely  even  though  they  never  have  any 
employees  who  qualify  under  the  plan. 

Another  important  defect  of  the  present  bill  is  that  the  pension  contributions 
by  the  self-employed  on  their  own  behalf  would  be  based  on  their  self-employ- 
ment income  which  generally  includes  income  from  capital  invested  in  the  busi- 
ness as  well  as  personal  service  income.  This  would  give  self-employed  people 
an  important  advantage  over  covered  employees  since,  under  present  law,  pension 
contributions  for  covered  employees,  including  owner-managers  of  corporations, 
are  based  on  earned  income  alone. 

H.R.  10  would  involve  a  revenue  loss  amounting  to  an  estimated  $358  million 
annually  on  a  full-year  basis.  Over  one-fourth  of  this  revenue  loss  would  be  ac- 
counted for  by  the  fact  that  the  bill  would  allow  self-employed  people  to  base 
their  allowable  deductions  for  pension  contributions  on  self-employment  income 
instead  of  on  personal  service  income  alone.  These  estimates  assume  that  actual 
deductions  for  contributions  made  by  self-employed  people  on  their  own  behalf 
would  be  only  a  part  of  the  maximum  allowable,  ranging  from  15  percent  of  the 
maximum  for  taxpayers  with  less  than  $3,000  of  income  to  GQjs  percent  of  the 
maximum  for  those  with  more  than  $20,000  of  income.  Particularly  in  view  of 
the  present  budgetary  situation,  it  would  clearly  not  be  appropriate  to  incur  a 

614359—62—23 


348    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

revenue  loss  of  this  magnitude  for  legislation  which  would  not  constitute  an 
adequate  solution  to  the  tax  treatment  of  the  retirement  savings  of  self-employed 
people. 

Because  of  these  compelling  considerations  the  Treasury  Department  is  op- 
posed to  the  enactment  of  H.R.  10.  Though  it  seeks  to  equalize  the  tax  treat- 
ment of  retirement  savings,  the  bill  creates  many  inec|uities  and  unjustifiable 
differences  in  tax  treatment.  As  you  know,  the  President  has  directed  the 
Treasury  to  undertake  the  research  and  preparation  of  a  comprehensive  tax  re- 
form program  to  be  submitted  to  the  Congress  next  year.  A  major  aspect  of 
this  program  will  be  a  broadened  and  more  equitable  tax  base  and  reconsidera- 
tion of  the  rate  structure.  We  believe  that  the  problem  which  H.R.  10  seeks  to 
meet  should  more  appropriately  be  considered  in  connection  with  such  a  general 
tax  program  so  that  this  problem  could  be  evaluated  in  the  context  of  the  entire 
program.  At  the  same  time  this  would  permit  consideration  of  the  problem  in 
the  light  of  a  general  examination  of  issues  in  the  pension  and  retirement  area 
and  in  the  context  of  the  rate  structure  that  may  result  from  a  reexamination  of 
the  existing  structure.  Accordingly,  the  Department  recommends  that  legisla- 
tion dealing  with  the  tax  treatment  of  the  retirement  savings  of  self-employed 
people  be  deferred  until  it  can  be  considered  in  the  perspective  of  the  entire  tax 
reform  program. 


International  Financial  and  Monetary  Developments 

Exhibit  16. — Statement  by  the  President,  October  27,  1961,  on  the  new  programs 
to  stimulate  American  exports,  strengthen  the  U.S.  balance  of  payments,  and 
enlist  the  maximum  cooperation  of  private  credit  facilities 

In  my  message  to  the  Congress  on  balance  of  payments  and  gold  earlier  this 
year,  I  directed  the  President  of  the  Export-Import  Bank  to  initiate  measures 
designed  to  give  American  exporters  full  equality  with  their  competitors  in  other 
countries  in  order  to  help  boost  the  total  volume  of  United  States  exports.  I  also 
asked  the  Secretary  of  the  Treasury  to  undertake  a  study  of  methods  through 
which  private  financial  institutions  could  participate  more  broadly  in  providing 
export  credit  facilities. 

These  two  studies  have  been  closely  coordinated  and  carried  out  under  the  im- 
mediate supervision  of  the  Export-Import  Bank,  with  policy  guidance  from  the 
Secretary  of  the  Treasury  and  the  National  Advisory  Council.  I  am  pleased  to 
announce  two  fundamental  and  complementary  steps  to  achieve  the  objectives  of 
stimulating  American  exports,  strengthening  the  balance  of  payments  of  our 
country,  and  enlisting  maximum  cooperation  of  private  credit  facilities. 

The  new  programs  are  intended  to  be  fully  comparable  with  those  offered 
abroad,  particularly  with  respect  to  small-and  medium-sized  export  concerns  and 
with  respect  to  assistance  in  the  financing  of  consumer  goods  exports. 

The  first  new  program  consists  of  a  system  of  export  credit  insurance  to  ex- 
porters. This  will  be  operated  through  the  newly  organized  Foreign  Credit 
Insurance  Association,  a  voluntary,  unincorporated  group  of  major  United 
States  insurance  companies.  The  FCIA  has  entered  into  an  agreement  with  the 
Export-Import  Bank  to  issue  coverage  against  commercial  foreign  credit  risks  in 
partnership  with  Eximbank,  which  will  cover  political  risks. 

The  second  program  consists  of  a  new  system  of  guaranties  to  be  issued  by 
Eximbank  directly  to  commercial  banks  and  affiliated  financial  institutions  under- 
taking the  financing  of  exports.  It  is  designed  to  encourage  these  banks  to 
provide  nonrecourse  financing  of  medium-term  credits,  and  to  speed  up  these 
transactions  by  permitting  the  exporter  to  deal  with  his  bank  rather  than  with 
Eximbank  in  Washington. 

The  objective  of  both  programs  is  to  assure  that  U.S.  exporters  will  not  lose 
sales  because  of  a  lack  of  credit  facilities  where  the  extension  of  credit  is  appro- 
priate. I  believe  that  American  exporters  will  be  more  disposed  to  extend  credit 
to  their  customers  if  they  hold  an  export  credit  insurance  policy  issued  through 
the  FCIA,  and  that  commercial  banks  will  be  prepared  to  discount  such  insured 
paper.  Accordingly,  our  exporters,  through  use  of  the  insurance  and  bank  guar- 
anty programs,  will  be  better  able  to  compete  successfully  with  exporters  in 
other  countries  on  sales  where  credit  is  required  by  the  customers  overseas. 

I  am  deeply  appreciative  of  the  splendid  response  of  private  industry  in  further- 
ing the  national  interest  in  this  area.     Both  the  participating  insurance  companies 


1 


EXHIBITS  349 

and  the  commercial  banks  have  rendered  a  public  service  through  their  coopera- 
tion in  making  these  export  credit  facilities  available  as  part  of  the  national  effort 
to  improve  the  balance  of  payments  to  the  United  States. 


Exhibit  17, — Statement  by  Secretary  of  the  Treasury  Dillon,  February  14,  1961, 
before  the  Senate  Foreign  Relations  Committee  on  ratification  of  the  Organi- 
zation for  Economic  Cooperation  and  Development  Convention 

I  am  glad  to  appear  before  the  Foreign  Relations  Committee  to  urge  Senate 
approval  of  the  Convention  for  the  Organization  for  Economic  Cooperation  and 
Development.  When  I  last  appeared  before  the  committee  on  this  subject,  we 
were  in  the  middle  of  the  negotiations  and  while  the  main  outlines  of  the  OECD 
Convention  were  already  clear  many  details  remained  to  be  ironed  out.  Now  the 
convention  has  been  signed  and  is  before  the  Senate  for  its  advice  and  consent  to 
ratification. 

The  concept  of  the  OECD  reflects  an  historic  change  in  our  relations  with 
Western  Europe  and  in  the  relations  between  the  industrialized  and  developing 
countries.  The  OECD  would  be  the  main  instrumentality  for  welding  stronger 
links  between  the  countries  of  North  America  and  Western  Europe  in  meeting  the 
enormous  challenge  they  face  in  advancing  the  cause  of  economic  growth  and 
freedom  throughout  the  free  world.  Only  through  working  together  can  we  bring 
our  tremendous  economic  resources,  technical  competence,  and  scientific  ability 
fully  to  bear  on  the  problems  of  today's  revolutionary  world. 

Before  indicating  in  more  detail  the  kind  of  cooperation  through  the  OECD  of 
major  concern  to  the  Treasury  Department,  I  should  like  to  mention  briefly  the 
origins  of  the  OECD  Convention,  with  which  I  was  closely  associated  as  Under 
Secretary  of  State. 

The  OECD  was  an  American  proposal  put  forward  by  President  Eisenhower  late 
in  1959.  It  was  an  initiative  to  which  the  Western  European  countries  and  Canada 
quickly  and  enthusiastically  responded. 

The  old  Organization  for  European  Economic  Cooperation,  originally  estab- 
lished in  1948  to  assist  in  carrying  out  the  Marshall  Plan,  had  completed  the  task 
it  was  designed  to  fulfill.  Western  Europe  had  been  restored  to  vigorous  health. 
Discriminatory  trade  quotas  were  rapidly  disappearing.  Convertibility  of  the 
major  European  currencies  had  been  reestablished.  This  era  of  transatlantic 
relations  had  drawn  to  a  close. 

In  this  earlier  period  the  United  States  and  Canada  were  associated  with  the 
Europeans  in  their  efforts  through  the  OEEC,  but  were  not  full  partners.  This 
was  proper  for  the  job  to  be  done  required  a  breakthrough  in  intra-European 
cooperation,  with  the  United  States  and  Canada  cast  in  the  role  of  providing 
material  and  moral  support  for  this  great  cooperative  effort  of  Europe  to  help 
itself. 

Now  we  are  entered  upon  a  new  era  and  face  new  challenges.  In  this  era 
intra-European  cooperation  remains  important  and  must  be  preserved.  But, 
beyond  this,  the  industrialized  countries  of  Western  Europe  and  North  America 
must  henceforth  work  in  full  partnership  to  strengthen  the  economy  of  the  entire 
free  world  and  to  provide  the  developing  countries  with  the  resources  they  so 
sorely  need  if  freedom  is  to  be  preserved. 

In  the  fall  of  1959  Western  Europe,  newly  strong  and  confident,  appeared 
ready  to  share  fully  with  us  the  responsibilities  we  had  shouldered  virtually  alone 
through  most  of  the  postwar  period.  Accordingly,  President  Eisenhower  in  his 
meetings  in  Paris  in  December  of  that  year  with  President  de  Gaulle,  Chancellor 
Adenauer,  and  Prime  Minister  Macmillan  suggested  that  the  time  had  come  to 
reorganize  and  revitalize  transatlantic  relations  so  as  to  redirect  the  energies  of 
the  industrialized  countries  toward  the  economic  improvement  of  the  free  world 
as  a  whole. 

Out  of  these  four-power  talks  emerged  consultations  and  negotiations  among 
all  eighteen  of  the  member  countries  of  the  OEEC,  the  United  States,  and  Canada. 

A  group  of  four  experts  was  created  to  draft  the  charter  of  a  successor  organi- 
zation to  the  OEEC  which  the  United  States  and  Canada  could  join  as  full 
members.  After  consulting  representatives  of  the  twenty  interested  governments, 
as  well  as  a  number  of  individuals  and  international  organizations,  the  group  of 
four  experts  submitted  their  draft  in  April  1960.     Intensive  intergovernmental 


350    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

negotiations  on  the  OECD  then  began  in  May  and  continued  ahnost  without 
break  until  December  14,  when  representatives  of  the  twenty  governments 
signed  the  OECD  Convention. 

The  result  of  this  work  is  the  convention  before  you.  It  provides  a  solid 
foundation  for  the  OECD.  It  clearly  states  the  basis  on  Avhich  the  industrialized 
nations  of  North  America  and  Western  Europe  are  joining  together  and  the 
reasons  why  they  are  doing  so.  It  provides  the  means  for  converting  common 
policy  objectives  into  effective  action.  Yet  it  does  not  restrict  or  impinge  upon 
the  sovereign  rights  which  each  of  the  member  countries  is  determined  to  pre- 
serve. In  short,  the  convention  provides  a  simple,  sturdy  platform  from  which 
the  OECD  countries  can  launch  cooperative  and  constructive  action  to  meet 
the  major  economic  problems  facing  us  today. 

The  Treasury  Department  is  especially  concerned  with  two  types  of  measures 
to  which  the  functions  of  the  OECD  would  be  relevant:  Those  that  will  in\'igor- 
ate  our  economy  and  those  that  will  improve  our  balance-of-payments  position. 
Such  measures  are  now  closely  interrelated.  For  the  first  time  in  over  thirty 
years,  and  to  a  larger  extent  than  ever  before  in  our  history,  our  success  in  pur- 
suing these  objectives  is  dependent  on  the  understanding  and  cooperation  of  the 
industrialized  countries  of  Western  Europe.  In  turn  their  economies  are  heavily 
influenced  by  our  actions  here  at  home.  We  must  take  into  account  the  inter- 
national repercussions  of  actions  which  we  take  here  at  home  since  the  reactions 
they  may  provoke  abroad  could  easily  frustrate  our  objectives.  The  only  answer 
is  close  continuing  consultation  and  cooperation  with  Canada  and  the  countries 
of  Western  Europe.  The  OECD  is  designed  to  provide  the  forum  for  this  con- 
sultation and  cooperation. 

As  an  example,  the  effectiveness  of  the  program  just  announced  by  the  Presi- 
dent to  improve  our  balance  of  payments  will  depend  to  a  considerable  degree  on 
the  extent  to  which  the  major  Western  European  countries  pursue  compatible 
policies.  It  is  in  this  connection  that  we  in  the  Treasury  Department  think  the 
OECD  will  be  especially  useful.  In  the  OECD,  we  shall  be  able  to  have  in- 
formal and  frank  consultations  with  policymaking  officials  from  our  partner 
countries.  Such  consultations  should  enable  the  OECD  countries  to  move  in 
harmony  toward  the  common  objective  of  economic  growth.  Also  such  consulta- 
tions should  result  in  measures  to  contribute  to  the  solution  of  the  U.S.  balance- 
of-payments  problem. 

The  President,  in  his  message  to  Congress  on  balance  of  payments  and  gold, 
set  forth  our  program  to  ease  the  problem  of  short-term  funds  as  well  as  to  cor- 
rect the  basic  payments  deficit  and  achieve  longer-term  equilibrium.  JNIost  of 
the  measures  described  by  the  President  will  be  more  effective  if  complementary 
policies  are  followed  by  the  major  OECD  countries.  Some  of  the  measures  can 
be  effective  only  in  cooperation  with  these  countries. 

To  illustrate  the  need  for  better  international  coordination  of  economic  and 
financial  policies  I  would  like  to  refer  to  last  year's  movements  of  international 
short-term  capital. 

During  the  first  half  of  1960  our  balance-of-payments  deficit  on  an  animal 
basis  was  $2.7  billion — -down  markedly  from  the  level  of  $3.8  billion  in  1959. 
Last  spring  our  Federal  Reserve  discount  rate  was  at  4  percent,  the  German 
Bundesbank  rate  was  4  percent,  and  the  Bank  of  England  rate  was  5  percent. 
In  other  words  all  those  rates  were  close  together.  Then,  as  business  began  to 
slow  in  the  United  States,  our  Federal  Reserve  began  to  ease  credit  and  reduced 
its  rate  first  to  3}^  percent,  and  later  to  3  percent.  Meanwhile  the  German 
Bundesbank,  with  its  eye  on  the  domestic  boom  in  Germany,  and  with  the  objec- 
tive of  controlling  inflation  at  home,  increased  its  discount  rate  to  5  percent  in 
June.  The  Bank  of  England  promptly  followed  suit  and  upped  its  rate  to  6 
percent. 

These  actions  brought  about  a  sharp  imbalance  in  short-term  interest  rates. 
The  results  were  bad  for  all  concerned.  A  flood  of  short-term  funds  left  New 
York  seeking  the  higher  return  in  Frankfurt  and  London.  This  sharply  increased 
our  balance-of-payments  deficit  from  an  annual  rate  of  $2.9  biUion  in  the  first 
six  months  to  a  rate  of  $4.7  billion  in  the  second  six  months.  This  sudden  and 
sharp  increase  shook  confidence  in  the  dollar  and  the  result  was  a  substantial 
increase  in  the  outflow  of  gold.  This  in  turn  brought  on  the  speculative  outbreak 
in  the  private  gold  market  in  London  last  October  when  for  a  day  or  two  gold 
sold  at  $40  an  ounce.  Meanwhile  the  large  inflow  of  American  funds  frustrated 
the  efforts  of  the  German  authorities  to  tighten  up  on  investment  in  Germany. 
When  this  became  clear  the  German  and  British  authorities  cut  back  their  discount 


EXHIBITS  351 

rates,  the  flow  of  short-term  capital  slowed  and  confidence  was  gradually  restored. 

The  lesson  to  be  learned  by  all  this  is  that  in  these  days  of  convertible  currencies 
there  must  be  close  cooperation  and  coordination  between  our  financial  and 
monetary  authorities  and  those  of  the  major  industrialized  countries  of  Western 
Europe.  This  is  now  recognized  on  all  sides.  The  OECD  is  the  forum  in  which 
this  coordination  can  be  worked  out  and  through  which  we  can  avoid  similar 
episodes  in  the  future.  As  such  it  is  a  vitally  important  element  in  our  drive  to 
right  our  payments  deficit  without  infringing  on  the  actions  that  must  be  taken 
to  reinvigorate  our  economy  at  home. 

The  OECD  will  also  provide  an  especially  important  mechanism  for  the 
industrialized  countries  of  North  America  and  Western  Europe  to  work  in  concert 
to  contribute  to  sound  economic  growth  in  the  less-developed  countries.  The 
extreme  poverty  of  these  countries  cannot  be  allowed  to  continue.  The  gap 
between  standards  of  living  in  the  industrialized  OECD  countries  and  those  in 
the  less-developed  countries  is  large  and  widening. 

To  narrow  this  gap  will  require  great  effort  and  considerable  resources. 
Economic  development  requires  the  formation  of  capital  on  a  large  scale.  While 
the  greatest  portion  of  this  capital  must  be  derived  from  savings  on  the  part  of 
the  less-developed  countries,  these  countries  also  need  large  help  from  the  indus- 
triahzed  countries.  By  fostering  consultation  and  coordination  among  member 
countries,  the  OECD  can  contribute  greatly  to  increasing  and  improving  the 
economic,  technical,  and  educational  assistance  extended  to  the  less-developed 
countries.  It  can  help  to  ensure  that  all  the  industrialized  countries  carry  their 
full  and  fair  share  of  the  burden,  including  those  which  up  to  now  have  not  fully 
met  their  responsibilities  in  this  field.  In  this  respect  also  we  in  the  Treasury 
Department  look  on  the  OECD  as  an  essential  instrument  of  financial  policy. 

To  summarize  the  role  of  the  OECD,  in  terms  of  tasks  which  the  President  has 
stressed  in  his  message  on  balance  of  payments  and  gold: 

It  will  be  a  major  forum  for  efforts  to  harmonize  the  financial  and  economic 
policies  for  growth  and  stability  of  most  of  those  industrialized  nations  of  the 
world  whose  economic  behavior  significantly  influences  the  course  of  the  world 
economy  and  trend  of  international  payments; 

It  will  provide  a  solid  framework  for  intensive  and  frequent  international 
consultations  on  the  financial  and  monetary  policies  which  must  be  pursued  in 
order  to  achieve  and  maintain  better  balance  in  the  international  payments 
position; 

Finally,  it  will  bring  into  being  an  organization  of  vital  importance  for  assisting, 
on  a  cooperative  basis,  the  developing  countries  of  the  free  world. 


Exhibit  18. — Statement  by  Secretary  of  the  Treasury  Dillon,  March  7,  1961, 
before  the  Joint  Economic  Committee 

I  am  pleased  to  meet  with  this  distinguished  committee.  It  is  important  that 
we  discuss  the  broad  outlines  of  our  economic  situation  and  the  economic  programs 
the  Government  should  follow  in  pursuit  of  our  central  national  objective. 

This  objective,  simply  stated,  is  to  preserve  and  develop  the  security,  freedom, 
and  prosperity  of  the  United  States  within  a  strong  free  world.  Our  economic 
policies,  both  domestic  and  foreign,  can  be  used  effectively  to  serve  our  central 
objective  if  they  are  directed  particularly  at  three  specific  economic  objectives 
which  have  been  a  subject  of  particular  concern  to  this  committee  during  the 
past  year. 

The  first  national  economic  objective  is  that  stated  in  the  Employment  Act  of 
1946,  namely,  the  maintenance  of  a  high  level  of  employment  or,  in  the  words  of 
the  act,  "maximum  employment." 

During  the  intervening  years,  marked  at  various  times  by  unanticipated  price 
rises,  attention  shifted  to  the  problem  of  inflation  and  reasonable  price  stability 
emerged  as  a  second  national  economic  objective. 

More  recently,  a  third  national  objective  has  received  increasing  emphasis — to 
develop  economic  policies  directed  at  stimulating  maximum  sustainable  rates  of 
growth  within  our  own  country  and  within  the  economies  of  our  friends  and  allies. 

In  pursuing  these  national  economic  objectives  it  is  important  to  keep  in  mind 
other  national  objectives  such  as  national  security,  a  desirable  degree  of  economic 
freedom,  a  maintenance  of  a  market  mechanism  unimpaired  by  the  absence  of 


352    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

workable  competition,  the  provision  of  adequate  Government  services  in  areas 
where  private  action  will  not  suffice,  and  some  equitable  distribution  of  income  and 
opportunity. 

It  is  only  realistic  to  recognize  that  some  courses  of  policy  and  action  can  serve 
to  promote  the  achievement  of  certain  of  our  goals  at  the  sacrifice  of  others.  It 
seems  important  that  we  search  for  and  employ  those  economic  policies  which  are 
best  designed  to  achieve  a  maximum  of  all  of  these  desirable  objectives,  without 
unduly  sacrificing  one  at  the  expense  of  another. 

In  moving  now,  in  the  year  1961,  towards  these  long-range  national  economic 
objectives,  we  must  recognize  the  urgency  of  the  two  major  problems  immediately 
confronting  us: 

First,  the  problem  of  bringing  about  a  prompt  recovery  from  the  present 
recession  and,  even  more  important,  a  continuing,  vigorous  expansion  in  our 
domestic  economy. 

Second,  during  the  long  standing  imbalance  in  our  international  payments,  and 
working  in  concert  with  other  industrialized  nations  toward  a  more  permanent 
equilibrium. 

The  simultaneous  occurrence  of  recession  and  acute  balance-of-payments  diffi- 
culties posed  new  and  complex  problems  for  the  United  States  last  year.  The 
sensitive  interrelationship  between  our  domestic  economy  and  our  balance-of- 
payments  situation  can  be  expected  to  remain  with  us  in  the  future.  For  today 
we  face  an  international  economic  situation  quite  different  from  anything  we 
have  seen  for  over  thirty  years.  This  new  situation  arose  two  years  ago  with 
the  return  of  convertibility  in  Europe.  For  the  first  time  since  the  thirties  all 
the  major  currencies  of  the  free  world  became  freely  interchangeable  for  current 
transactions. 

This  new  situation  severely  aggravated  our  balance-of-payments  problem  last 
year  and,  in  turn,  it  determined  the  nature  of  some  of  our  responses  to  recession 
here  at  home. 

To  begin  with,  I  should  like  to  review  briefly  the  significant  developments  in 
our  balance  of  payments  in  recent  years. 

Between  1951  and  1957  foreign  countries  utilized  the  proceeds  of  their  surpluses, 
averaging  roughly  one  billion  dollars  a  year,  to  build  up  needed  reserves  of  dollars. 
The  situation  has  been  quite  different  since  1957.  In  1958  and  1959,  our  exports 
fell  off  sharply  and  our  imports  rose.  Our  deficit  rose  to  $3}4  billion  and  more 
a  year  and  we  had  to  pay  out  some  $3  billion  in  gold  to  cover  a  large  part  of 
this  deficit.  In  1960  another  overall  deficit  of  $3.8  billion  occurred  and  we  paid 
out  another  $1.7  billion  of  gold. 

The  situation  in  1960  was  dominated  by  a  new  element.  Our  exports  had  a 
very  good  year.  But  a  very  large  outflow  of  short-term  capital  took  place,  mainly 
from  June  to  the  end  of  the  year.  Our  basic  deficit — that  is,  minus  the  short- 
term  capital  outflow — markedly  improved,  and  was  estimated  at  about  $1}^ 
billion,  as  against  something  over  $4  billion  in  1959.  The  outflow  of  short-term 
capital,  amounting  to  more  than  two  billion  dollars,  was  the  major  factor  in  the 
large  drain  of  gold  and  dollars  during  the  final  six  months  of  last  year. 

Now  what  caused  this  new  phenomenon — the  large  scale  exodus  of  short-term 
capital? 

With  convertibility,  international  money  markets  have  again  become  closely 
interconnected  and  liquid  funds  now  flow  freely  in  large  volume  between  these 
markets  in  response  to  differentials  in  interest  rates,  as  well  as  to  speculative 
considerations.  When  recession  here  coincided  with  boom  abroad  from  mid-1960 
onward,  monetary  policies  and  interest  rates  in  the  United  States  and  Europe 
diverged  widely.  At  one  time  last  fall  a  short-term  investor  could  obtain  as  much 
as  two  percent  more  on  his  money  in  London  than  in  New  York.  Hence,  a  broad 
stream  of  short-term  capital  moved  from  New  York  to  London  and  other  European 
money  centers  in  search  of  these  higher  short-term  rates.  The  size  of  this  flow 
shook  confidence  in  our  ability  to  maintain  the  value  of  the  dollar.  Speculation 
began  against  the  dollar  and  added  to  the  outflow.  This  speculative  fever 
continued  unabated  until  late  January. 

The  first  task  of  this  administration  was  to  restore  confidence  and  put  an  end 
to  these  speculative  movements.  The  President  promptly  pledged  that  the 
official  dollar  price  of  gold  would  be  maintained  at  $35  per  ounce.  He  also  out- 
lined a  broad  and  comprehensive  approach  to  achieving  an  overall  equilibrium 
in  our  international  payments,  placing  heavy  emphasis  on  expanding  our  exports. 
He  rejected  protectionism  as  ineffective  and  undesirable  and  stressed  that  help 


( 


EXHIBITS  353 

for  the  less-developed  countries  from  all  the  economically  advanced  countries 
must  be  enlarged. 

I  am  pleased  to  report  that  reaction  abroad  to  the  President's  vigorous  and 
determined  approach  has  been  very  favorable.  The  dollar  once  again  is  strong. 
There  has  been  a  decided  slackening  in  the  outflow  of  gold  and  dollars  and  there 
are  signs  that  some  of  the  speculative  funds  that  left  our  shores  last  fall  are 
beginning  to  return. 

This  is  not,  of  course,  a  sign  that  the  problem  is  over,  but  only  that  the  world 
believes  that  we  mean  what  we  say.  It  is  imperative,  therefore,  that  we  press 
on  with  more  fundamental  measures  for  correcting  our  basic  balance-of -payments 
deficit,  utilizing  the  breathing  spell  provided  by  this  free  world  vote  of  confidence. 
It  is  clear  that  achievement  of  reasonable  equilibrium  in  our  balance  of  payments 
will  not  be  a  simple  task.  It  will  involve  vigorous  and  many-sided  action  by  our 
Government,  the  cooperation  of  other  free  countries,  and  active  and  enlightened 
support  by  our  own  people.  I  am  increasingly  hopeful  that  if  we  utilize  these 
elements,  properly  welded  together,  we  can  reach  our  goal  within  the  next  two  years. 

One  inescapable  conclusion  which  emerged  from  the  short-term  capital 
movements  of  1960  is  the  need  for  more  effective  international  cooperation  in 
economic  and  monetary  policy  in  order  to  minimize  the  disruptive  effects,  and 
the  magnitude  of  such  movements.  To  be  sure  there  will  always  be  differences 
among  countries  in  the  timing  of  booms  and  recessions,  and  there  will  always  be 
some  need  for  a  short-term  capital  flow.  But  if  fuller  exchanges  of  views  and 
experience  among  the  financial  ofl^cials  of  leading  countries  can  in  any  way  reduce 
the  impact  of  these  swings,  we  must  seek  such  exchanges.  We  hope  to  pursue 
this  cooperation  through  the  proposed  new  Organization  for  Economic  Coopera- 
tion and  Development  (OECD),  through  the  International  Monetary  Fund,  and 
in  other  appropriate  ways.  At  longer  range,  we  are  instituting  a  thorough  explora- 
tion of  measures  to  improve  the  functioning  of  the  International  Monetary  Fund 
and  to  strengthen  its  capabilities,  in  order  to  assure  adequate  and  flexible  liquidity 
for  the  growth  that  lies  ahead. 

I  have  said  that  we  must  utilize  the  time  given  us  by  the  restoration  of  confidence 
to  attack  the  problem  of  our  basic  deficit,  which  last  year  amounted  to  about 
$1.5  billion.  In  dealing  with  this  basic  deficit,  we  are  actively  pursuing  the 
specific  lines  of  policy  laid  down  by  the  President.  For  example,  we  expect  to 
tie  our  military  procurement  and  economic  aid  expenditures  even  more  closely 
to  United  States  sources  of  supply.  We  are  preparing  to  improve  our  facilities 
for  providing  credit  to  our  exporters.  We  are  moving  vigorously  to  promote  an 
increased  stream  of  tourists  to  the  United  States.  We  are  recommending  a 
reduction  in  tourist  allowances.  We  are  developing  procedures  to  encourage 
foreign  monetary  authorities  to  hold  dollars.  And  we  are  reexamining  the  tax 
status  of  American  investment  abroad  to  determine  whether  it  is  paying  its  fair 
share  of  our  national  tax  and  whether  or  not  any  deficiency  of  our  tax  system  in 
this  regard  has  contributed  substantially  to  an  imbalance  of  payments.  We  will 
continue  to  explore  ways  and  means  of  assuring  that  the  substantial  payment 
imbalances  of  recent  years  are  not  continued  so  as  to  impair  our  national  economic 
position. 

But  improvement  in  our  basic  deficit  also  means  that  the  chronic  surplus  in 
the  balance  of  payments  of  certain  other  advanced  countries  needs  to  be  simul- 
taneously reduced.  This  calls  for  improved  international  cooperation  across  the 
broad  spectrum  of  economic  policies.  International  cooperation  is  also  increas- 
ingly needed  in  approaching  what  are  now  mutual  responsibilities  for  a  rising 
flow  of  capital  to  the  less-developed  countries.  We  hope  to  facilitate  both  of 
these  types  of  cooperation  through  the  OECD. 

It  is  also  essential  for  our  people  to  realize  that  we  are  inevitably  subject  to 
international  competition.  Just  as  this  country  has  always  found  open  competi- 
tion to  be  a  major  force  in  stimulating  growth,  expansion,  and  technological 
change  here  at  home,  the  same  is  proving  to  be  true  internationally.  This 
development  serves  to  emphasize  our  need  to  remain  strong  and  competitive — and 
not  restrictive  or  isolated.  Obviously,  this  has  a  great  many  implications  for 
American  industry  in  terms  of  the  price-wage-cost  structure.  It  becomes  impor- 
tant to  emphasize  to  both  management  and  labor  that  profits  and  wages  need 
not  always  be  increased  to  provide  more  benefits  to  investors  and  workers.  Both 
of  these  economic  groups  are  made  up  of  individual  consumers.  Hence,  the  pro- 
vision of  more  goods  and  services  for  the  same  dollar  by  some  lowering  of  prices 
with  increasing  productivity  may  better  distribute  the  benefits  of  that  increased 


354   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

productivity  between  workers,  investors,  and  consumers,  without  sacrificing  our 
international  competitive  position.  The  President  has  just  provided  a  channel 
for  funneling  many  of  these  considerations  and  bringing  them  to  bear  on  key 
problems  through  the  President's  Advisory  Committee  on  Labor-Management 
Policy. 

Now  to  return  to  the  problems  of  our  economy  here  at  home.  We  must  try 
to  produce  an  environment  that  will  not  only  bring  us  out  of  our  present  recession, 
but  will  also  permit  our  economy  to  grow  at  a  faster  rate  than  has  been  the  case 
in  recent  years. 

The  role  of  the  Federal  Government  as  an  energizing  force  in  the  growth  of 
our  economy  and  as  a  stabilizing  influence  upon  its  ups  and  downs  is  daily  becom- 
ing more  important.  But  there  are  limits  upon  what  the  Government  can,  or 
should,  do.  It  is  as  important  to  avoid  overcommitment  as  undercommitment, 
as  essential  to  avoid  waste  as  to  avoid  constrictive  economy.  We  must  make 
certain  that  the  powerful  and  productive  influence  of  the  Federal  Government 
is  used  most  effectively. 

Our  Nation's  resources — the  capacity  of  our  people  and  the  quality  of  our 
physical  plant  and  materials — are  impressive.  But  they  are  not  presently  being 
fully  utilized  and  the  level  of  unemployment  is  unacceptably  high.  In  initiating 
new  programs  of  expansion,  therefore,  we  can  call  upon  unused  resources,  upon 
credit  ease  and  fiscal  expansion — and  even  upon  a  reasonable  budget  deficit  for 
a  limited  period  of  time — without  running  the  risk  of  inflation. 

There  are,  of  course,  inescapable  physical  limits  on  the  speed  with  which  our 
untapped  reserves  can  be  put  to  use.  Nevertheless,  the  current  recession  makes 
a  modest  and  temporary  deficit  not  only  inevitable,  but  actually  desirable  as  a 
stimulant  to  recovery  and  the  resumption  of  economic  growth.  The  fact  is  that 
a  budget  deficit  may  prove  helpful  in  a  period  of  widespread  unemployment  such 
as  the  present  one.  IDuring  periods  of  prosperity,  of  course,  we  should  return  to 
balanced  budgets  and  surpluses. 

It  is  now  clear  that  revenues  in  fiscal  1962  cannot  help  but  be  less  than  those 
projected  in  President  Eisenhower's  final  Budget  Message  of  January  16.  In 
that  message,  corporate  profits  for  calendar  1961  (on  which,  of  course,  fiscal  1962 
revenue  figures  are  based)  were  estimated  at  forty-six  billion  dollars.  The  facts 
now  available  indicate  that  this  estimate  is  too  high,  possibly  by  as  much  as  three 
billion  dollars.  In  addition,  personal  income  may  fall  somewhat  short  of  the 
four  hundred  fifteen  billion  dollar  estimate  in  that  message. 

I  cannot  pinpoint  revenues  and  expenditures  more  exactly  since  final  decisions 
have  not  yet  been  taken  by  the  President.  However,  the  Director  of  the  Budget 
will  be  able  to  provide  you  with  these  estimates  when  he  appears  before  you  later 
this  month. 

In  past  recessions  the  Federal  Reserve  has  been  able  to  promote  the  needed 
lower  long-term  rates  of  interest  by  allowing  the  short-term  rate  to  fall  almost  to 
zero.  In  1958,  for  instance,  ninety  day  bills  sold  at  six-tenths  of  one  percent. 
This  tended  to  lower  long-term  rates  and  in  turn  promoted  economic  recovery. 
It  is  important  here  to  recognize  that  extremely  low  short-term  rates  are  not  of 
themselves  necessary  for  recovery.  They  reflect  increased  credit  availability 
and  help  stimulate  the  investment  flow  into  the  long-term  sector  at  lower  rates. 
Today,  a  reduction  in  long-term  interest  rates,  including  mortgage  rates,  is  just 
as  necessary  as  in  previous  recessions,  but  we  must  find  new  tools  to  achieve  it. 
No  longer  can  extremely  low  short-term  rates  be  permitted  to  result  from  credit 
easing  steps  taken  to  achieve  our  recovery  objective.  Instead,  moves  have  been 
made  to  stabilize  the  short-term  rate  around  present  levels,  an  adequately  low 
rate  for  business  purposes.  There  is  always  the  danger  that  a  lower  rate  may 
precipitate  a  renewed  flow  of  short-term  capital  abroad  which  could  once  again 
aflfect  confidence  in  the  soundness  of  our  dollar.     This  we  cannot  allow  to  occur. 

Therefore,  other  means  must  be  found  to  promote  lower  long-term  rates — ■ 
means  that  they  do  not  immediately  involve  downward  pressures  on  short  rates. 
It  was  this  dilemma  that  led  the  Federal  Reserve  Board  to  the  conclusion  that 
the  "bills  only"  policy  which  had  worked  effectively  in  earlier  recessions  was 
no  longer  appropriate  to  the  task  at  hand.  In  addition,  the  Treasury  can  and 
should  support  efforts  to  lower  the  long-term  rate  by  judicious  debt  management 
policies,  not  forgetting,  however,  the  need  for  some  lengthening  of  the  debt  so 
as  to  maintain  a  reasonable  refunding  pattern. 

Recent  developments  in  this  field  can  be  seen  from  the  two  charts  before  you 
which  show  the  market  yields  on  U.S.  Treasury  securities  for  selected  dates. 


EXHIBITS 


355 


MARKET  YIELDS  ON  U.S.  TREASURY  SECURITIES 
Pattern  of  Rates  by  Length  of  Maturity 


15  20  25 

Yeors  to  Moturity 


30 


35 


40 


The  first  chart  shows  that  the  high  point  last  year  was  reached  in  January 
and  the  low  point  the  following  July.  It  also  clearly  shows  that  long-term  rates 
actually  moved  up  as  the  recession  deepened  toward  the  end  of  last  year — 
indicative  of  a  lag  in  the  availabilit}"  of  credit  to  borrowers. 

MARKET  YIELDS  ON  U.S.  TREASURY  SECURITIES 
Pattern  of  Rates  by  Length  of  Maturity 


The  second  chart  shows  that  a  decline  in  rates  has  occurred  since  Inaugural 
Day  and  that  a  further  decline  followed  the  President's  economic  message,   in 


356   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

which  he  specifically  called  for  maintaining  short^rates  at  current  levels  and  a 
greater  availability  of  long-term  credit  at  declining  rates.  This  decline  in  long- 
term  rates,  coupled  with  the  maintenance  of  short-term  rates,  was  helped  when 
the  Federal  Reserve  last  month  began  buying  Government  notes  and  bonds  of 
varying  maturities,  some  beyond  five  years,  for  virtually  the  first  time  in  a 
decade,  and  the  Teasury  concentrated  its  sales  of  securities  in  the  short-term 
sector.  The  effect  of  these  policies  is,  of  course,  to  decrease  the  supply  of  long-term 
securities  and  increase  the  supply  of  short-term  securities. 

Our  attempts  to  try  to  bring  about  a  greater  availability  of  credit  at  lower 
interest  rates  in  pursuing  recovery  and  growth  are  certainly  justified  by  recent 
developments.  There  has  been  a  notable  lag  in  certain  key  areas  such  as  housing 
and  municipal  and  corporate  investment.  Yet  these  are  the  very  areas  which  we 
wish  to  stimulate. 

Let  me  briefly  examine  these  tliree  specific  areas: 

First,  housing:  Although  in  housing  the  availability  of  credit  at  lower  mortgage 
rates  is  only  one  aspect  of  the  problem,  it  is  nevertheless  an  important  one.  We 
are  hopeful  that  efforts  of  the  administration  to  lower  mortgage  rates — by 
reducing  the  Federal  Housing  Administration  rate,  placing  more  emphasis  in  the 
Federal  National  Mortgage  Association  program  on  buying  rather  than  selling 
mortgages,  and  urging  key  mortgage  lenders  to  lower  their  rates — will  help  to 
speed  up  a  decrease  in  long-term  mortgage  rates  reflecting  the  increase  in  available 
mortgage  funds  that  is  already  beginning  to  manifest  itself. 

Second,  security  offerings  of  municipalities.  State,  and  local  governments: 
Ordinarily,  as  interest  rates  decline  and  funds  become  increasingly  available  in  a 
recession  period,  such  offerings  increase.  However,  in  the  current  recession,  this 
pattern  has  not  been  discernible.  As  late  as  last  month,  offerings  continued  to 
lag  somewhat  below  a  year  ago.  But  as  the  credit  ease  continues,  we  can  expect 
some  growth  in  constructive  municipal  borrowing.  Estimates  for  March  project 
a  considerable  increase  over  the  corresponding  month  last  year. 

Third,  the  corporate  financing  field,  where  the  stock  market  seems  to  be  openly 
inviting  additional  equity  financing — an  invitation  we  hope  will  be  increasingly 
accepted  by  corporations.  For  the  more  corporations  turn  to  the  securities 
markets  and  repay  their  bank  loans,  the  more  the  banks  will  be  able  to  supply 
credit  to  other  borrowers,  and  so  stimulate  recovery. 

There  is  another  vital  force  in  this  whole  area  of  interest  rates  and  the  avail- 
ability of  funds  generally,  and  that  is  in  the  field  of  tax  policy. 

I  shall  defer  discussion  of  this  subject  in  view  of  the  recommendations  which  the 
President  proposes  to  submit  shortly  on  tax  measures  that  will  encourage  the 
expansion  and  modernization  of  the  Nation's  productive  plant  so  as  to  accelerate 
economic  growth  and  improve  the  international  competitive  position  of  American 
industry.  It  will  perhaps  suffice  to  state  the  basic  goal  of  our  tax  policy.  It  is 
simply  this:  to  develop  and  maintain  a  strong  tax  system  which  will  meet  the 
revenue  requirements  of  the  Government,  contribute  to  economic  stability,  and 
further  the  objectives  of  a  dynamic  and  growing  economy. 

The  tax  system  should  be  flexible  and  respond  to  changing  economic  conditions. 
In  times  of  falling  income,  the  receipts  under  such  a  tax  system  should  decline,  so 
that  resulting  Federal  Budget  deficits  will  help  to  sustain  the  level  of  demand  and 
employment.  In  times  of  rising  income  and  employment,  the  system  should 
furnish  increasing  revenue  and  a  surplus  should  result.  An  important  advantage 
of  the  surplus  will  be  that  through  debt  retirement,  it  can  be  made  available  to 
private  investors  for  capital  formation  and  economic  growth.  We  are  looking 
forward  to  a  strong  economy  in  which  such  years  of  surplus  will  match  or  exceed 
those  of  deficit. 

The  problems  of  bringing  about  a  prompt  recovery  and,  more  importantly, 
vigorous  expansion,  call  for  the  stimulating  potential  of  a  larger  Government 
budget  within  a  financially  orderly  framework.  We  aim  to  make  Government's 
contribution  to  economic  activity  in  a  way  that  will  provide  solid  support — rather 
than  more  temporary  stimulus — to  the  flourishing  and  continuing  growth  we  can 
and  must  achieve.  We  hope  that  by  carrying  out  these  many-sided  programs  with 
resolve  and  determination,  we  can  make  maximum  use  of  our  resources,  both 
human  and  material,  to  create  a  brighter  future  for  all  Americans. 


EXHIBITS  357 

Exhibit  19. — Remarks  by  Secretary  of  the  Treasury  Dillon,  April  11,  1961,  at 
the  second  meeting  of  the  Board  of  Governors  of  the  Inter-American  Devel- 
opment Bank,  Rio  de  Janeiro,  Brazil 

It  is  a  special  pleasure  for  me  to  meet  with  you  in  my  new  capacity  as  a  Governor 
of  the  Inter-American  Development  Bank.  The  concept  of  the  Bank  as  a  vital 
instrument  of  inter-American  cooperation  has  been  close  to  my  heart  since  1958, 
when  I  had  the  high  privilege  of  informing  the  Inter-American  Economic  and 
Social  Council  of  United  States  support  for  this  new  and  long-dreamed  of  joint 
venture. 

We  are  all  grateful  to  the  Government  and  the  people  of  Brazil  for  inviting  us 
to  this  gracious  and  hospitable  city  of  Rio  de  Janeiro.  The  fame  of  Rio  as  a 
world  metropolis  is  too  well  established  for  us  to  enrich  it  further  by  our  remarks. 
But  we  can  and  do  extend  our  warm  thanks  to  the  friendly  people  of  this  lovely 
city  for  making  our  stay  so  very  pleasant. 

I  also  cannot  fail  to  congratulate  our  chairman,  the  distinguished  Minister  of 
Finance  of  Brazil,  for  the  inspiration  which  he  has  given  to  our  deliberations  by 
the  wisdom  of  his  words.  It  is  fitting  that  the  first  birthday  of  the  Bank  is  being 
celebrated  here  in  Brazil,  whose  genius  gave  us  the  noble  concept  of  Operacao 
Panamericana.  Operation  Pan  America,  born  of  onrushing  social  change  and 
the  awakening  aspirations  of  the  people,  speaks  to  the  hearts  of  the  men  and 
women  of  the  Americas.  It  is  a  spiritual  call  to  action,  action  to  raise  the  living 
standards  of  the  many  millions  who  now  struggle  in  poverty  and  to  give  their 
lives  real  meaning  in  terms  of  personal  freedom  and  individual  dignity.  More 
than  a  century  ago,  democracy  raised  its  voice  throughout  Latin  America  in  a 
revolutionary  "grito"  for  liberty.  Operation  Pan  America  is  the  "grito"  of  the 
20th  century — an  insistent  and  inexorable  demand  for  liberation  from  the  human 
misery  created  by  crushing  economic  and  social  conditions.  The  governments 
and  the  peoples  of  the  hemisphere  are  responding  to  the  call.  At  San  Salvador, 
a  year  ago,  we  joined  in  inaugurating  the  Inter- American  Development  Bank. 
At  Bogota,  last  fall,  we  joined  in  launching  an  unprecedented  social  develop- 
ment program  for  Latin  America,  a  program  which  substantially  enlarged  the 
responsibilities  of  the  Bank.  The  stage  is  now  set  for  us  to  join  together  again 
in  a  vast,  expanded  effort  to  achieve  our  goals  through  practical  and  concrete 
measures  affecting  all  aspects  of  economic  and  social  life. 

President  Janio  Quadros  in  his  message  last  month  to  the  National  Congress 
stated:  "As  was  recognized  by  the  Act  of  Bogota,  in  which  the  major  practical 
and  theoretical  points  of  Operation  Pan  America  were  consecrated,  the  solution 
of  the  problems  which  afflict  the  Continent  will  depend  substantially  on  economic 
progress.  That  economic  progress  will  not  be  stimulated  until  the  Governments 
of  America  decide  to  pass  from  the  plane  of  theoretical  formulations  to  the  terrain 
of  the  practical  execution  of  adequate  measures."  To  "pass  from  the  plane  of 
theoretical  formulations  to  the  terrain  of  the  practical  execution  of  adequate 
measures" — ^and  to  do  so  on  a  comprehensive  scale:  this  is  the  very  purpose  of  the 
Alianza  Para  El  Progreso  proposed  by  President  Kennedy.  In  President  Ken- 
nedy's words:  "If  we  are  to  meet  a  problem  so  staggering  in  its  dimension,  our 
approach  must  itself  be  equally  bold,  an  approach  consistent  with  the  majestic 
concept  of  Operation  Pan  America.  Therefore,  I  have  called  on  all  the  people  of 
the  hemisphere  to  join  in  a  new  alliance  for  progress — a  vast  cooperative  eff"ort, 
unparalleled  in  magnitude  and  nobility  of  purpose,  to  satisfy  the  basic  needs  of  the 
American  people  for  homes,  work  and  land,  health  and  schools — techo,  trabajo  y 
tierra,  salud  y  escuela." 

What  are  the  economic  and  social  goals  we  must  pursue  in  carrying  forward  an 
alliance  for  progress? 

I  think  these  goals  can  be  defined  as  growth,  stability,  and  social  equity  for  the 
individual.  These  three  goals  go  hand  in  hand.  They  are  not  isolated  objectives. 
Indeed,  if  they  are  to  serve  the  people,  and  in  our  hemisphere  the  well-being  of  the 
people  is  the  supreme  purpose  of  government,  they  must  form  an  indissoluble 
trinity. 

Economic  stability  is  not  an  end  in  itself.  It  is  a  means  to  promote  steady  and 
widely  shared  economic  growth.  To  induce  an  adequate  rate  of  savings,  to  chan- 
nel investment  into  truly  productive  undertakings,  to  strengthen  popular  con- 


358   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

fideiice  in  democratic  processes,  to  attract  foreign  enterprise,  in  short  to  promote  a 
balanced  development  of  the  economy,  there  must  be  reasonable  price  stability. 
This  in  turn  requires  effective  budget  management  and  tax  administration. 
Credit  policies  should  be  designed  to  foster  growth.  They  should  also  be  designed 
to  avoid  speculative  excess.  Foreign  exchange  policies  should  realistically  relate 
internal  prices  and  cost  to  world  markets.  These  views,  I  believe,  are  now  well 
settled  in  the  thinking  of  those  responsible  for  economic  and  financial  policy  in 
the  developing  countries.  The  heavy  long-run  costs  of  severe  inflation  have  been 
widely  recognized.  The  illusion  that  such  inflation  can  provide  a  quick  and  easy 
way  to  better  living  standards  has  been  dispelled.  Of  course  economic  stability 
by  itself  will  not  guarantee  economic  growth.  This  is  especially  true  in  the 
developing  countries,  where  bold  and  positive  efforts  must  be  made  in  both  the 
governmental  and  private  sectors  to  help  create  the  conditions  for  growth. 

I  have  heard  it  said  that  some  Latin  Americans  believe  the  United  States  is 
concerned  only  with  financial  stabilization  programs  in  Latin  America.  If  there 
are  any  doubts  on  this  score,  let  me  dispel  them  here  and  now:  The  United  States 
is  concerned,  and  deeply  concerned,  with  much  more  than  stability.  We  do  not 
accept  economic  stagnation  as  a  tolerable  condition  for  the  Americas.  Develop- 
ment— growth,  progress  broadly  based  and  widely  shared — these  must  be  our 
primary  objectives.  Stablilization  and  growth  are  not  alternatives  in  conflict 
with  each  other. 

On  the  contrary,  they  are  mutually  reinforcing  objectives  which,  when  pursued 
simultaneously,  promote  improvement  in  living  standards  at  the  most  rapid  and 
continuous  rate  possible.  Social  equity  for  the  individual,  our  third  goal,  is  in 
many  ways  the  most  important.  Development  will  not  produce  true  economic 
progress  if  its  benefits  are  restricted  to  the  privileged  few  and  denied  to  the  many 
who  today  are  sadly  underprivileged.  Social  equity  for  the  individual  must  be  a 
prime  target  of  our  endeavor.  Our  spiritual  traditions  demand  no  less.  More- 
over, people  are  the  single  most  powerful  factor  in  economic  development.  With- 
out social  equity  for  the  individual,  democracy  will  languish  and  free  government 
will  disappear.  The  move  rapidly  towards  these  interrelated  goals,  the  Alliance 
for  Progress  proposed  by  President  Kennedy,  calls  for  a  concerted  maximum 
eiTort  over  the  next  decade.  This  would  involve  the  formulation  by  each  Latin 
American  country  of  its  own  long-term  plans  for  development,  as  well  as  the 
establishment  of  specific  targets  and  priorities.  These  plans  would  not  only 
inspire  surging  national  efforts,  they  would  also  provide  solid  foundations  for  the 
effective  use  of  external  assistance  from  the  Inter-American  Development  Bank, 
from  the  United  States  and  other  industrialized  countries,  and  from  the  inter- 
national institutions  of  the  free  world. 

The  new  Social  Development  Program  embodied  in  the  Act  of  Bogota  will  be 
an  important  part  of  the  Alliance  for  Progress.  We  are  confident  that  this  pro- 
gram can  be  started  quickly,  with  the  Inter- American  Bank  taking  a  leading  role. 
As  you  know,  President  Kennedy  has  proposed  to  our  Congress  that,  of  the  500 
million  dollars  to  be  provided  as  a  first  step  in  implementing  social  development 
imder  the  Act  of  Bogota,  394  million  dollars  be  administered  by  the  Bank  and  six 
million  dollars  by  the  Organization  of  American  States.  In  the  normal  course  of 
our  legislative  process  these  funds  should  become  available  within  the  next  two 
months.  Social  development,  we  are  all  agreed,  must  be  accompanied  by  eco- 
nomic development. 

Planning  and  resources,  both  national  and  international,  must  be  devoted  to 
the  expansion  of  industry,  agriculture  and  mining,  transport  and  power,  and 
(commercial  enterprise.  The  United  States  is,  therefore,  prepared  to  devote 
substantial  resources  over  and  above  the  present  flow  of  public  and  private  capital, 
to  basic  economic  development  as  a  part  of  the  Alliance  for  Progress.  President 
Kennedy  has  submitted  to  the  Congress  a  new  overall  program  of  foreign  economic 
assistance  to  assure  the  availability  of  United  States  public  capital  for  these  pur- 
poses in  Latin  America,  as  well  as  in  other  developing  countries.  This  assistance 
will  be  available,  on  a  long-range  basis,  both  for  specific  projects  and  for  general 
economic  support  of  well-conceived  development  programs.  Terms  of  repayment 
are  to  be  adjusted  to  national  ability  to  repay,  and  will  include  the  use  of  long-term, 
interest-free  loans. 

We  also  hope  that  the  Alliance  for  Progress  will  lead  to  an  increase  in  develop- 
ment assistance  to  Latin  America  from  tlie  other  industrialized  countries  of  the 
free  world.  Two  weeks  ago  in  London,  the  members  of  the  Development  Assist- 
ance Group  agreed  upon  a  significant  declaration  of  policy.  They  called  for  an 
expansion  of  the  aggregate  volume  of  the  resources  presently  flowing  to  the 


I 


EXHIBITS  359 

developing  countries,  for  aid  on  an  assured  and  continuing  basis,  and  for  greater 
assistance  in  the  form  of  grants  and  loans  on  favorable  terms.  A  larger  supply 
of  external  public  capital  and  its  more  systematic  application  for  development 
programs  should  bring  about  a  greater  flow  of  foreign  private  investment,  par- 
ticularly investment  in  the  production  and  distribution  of  goods  and  services 
for  expanding  domestic  markets.  When  the  new  Organization  for  Economic 
Cooperation  and  Development  is  established  sometime  later  this  year,  the 
Development  Assistance  Group  will  become  a  subsidiary  body  of  the  OECD. 

Through  the  Organization  of  American  States,  Latin  America  should  have  a 
close  working  relationship  with  the  OECD.  The  United  States  will  strive  to 
bring  this  about.  We  do  not  foresee  any  difficulty,  for  I  understand  that  Mr. 
Thorkil  Kristensen,  the  distinguished  European  statesman,  who  will  be  the 
Secretary  General  of  the  OECD,  shares  this  view. 

I  have  spoken  of  the  need  for  self-help  and  effective  national  planning  in  carry- 
ing forward  the  Alliance  for  Progress.  The  phrase  "self-help"  should  not  be 
interpreted  to  mean  conditions  imposed  upon  a  country  as  the  price  of  external 
assistance.  Quite  the  contrary,  self-help  is  the  key  to  the  entire  development 
process.  Without  it,  outside  assistance  would  be  totally  ineffective.  The  great 
bulk  of  resources  for  development,  human  and  material,  must  come  from  within 
the  developing  countries.  External  assistance  can  be  a  critically  important  sup- 
plement to  their  own  efforts.  But  it  can  be  effective  only  when  the  developing 
countries  make  full  use  of  their  own  resources  on  their  own  behalf. 

It  is  for  this  reason  that  long-range  planning  and  programming  for  economic 
and  social  development  are  so  important  to  the  concept  of  the  Alliance  for 
Progress. 

As  we  see  it,  development  planning  does  not  imply  regimentation  of  economies 
through  governmental  controls.  It  does  mean  consistent  programming  of  public 
investment  aimed  at  broad  development  targets — programming  supplemented 
by  economic  and  social  policies  designed  to  activate  a  nation's  energies  and 
resources,  including  the  indispensable  private  sector.  It  means  good  monetary 
management.  It  means  the  mobilization  of  each  country's  resources  in  a  manner 
best  calculated  to  bring  into  the  common  endeavor  the  savings  and  earnings  of 
all  the  people.  It  means  the  encouragement  of  private  enterprise  through  tax 
and  other  policies.  It  means  the  building  of  roads  and  dams.  It  means  the 
extension  of  marketing,  distribution,  and  banking  systems.  It  means  the  opening 
up  of  agricultural  lands  and  the  reformation  of  outdated  systems  of  land  tenure. 

Let  us  not  deceive  ourselves.  The  adoption  and  execution  of  well-planned 
programs  based  upon  self-help  will  call  for  discipline  and  sacrifice.  These  burdens 
will  bear  most  heavily  upon  the  more  favored  classes  of  society.  Great  as  these 
sacrifices  may  be,  I  am  confident  that  they  will  be  made.  For  the  challenge 
which  the  Americas  face  is  clear  and  unmistakable.  We  can  not,  we  dare  not, 
let  it  go  unanswered. 

The  vast  effort  required  in  planning,  in  self-help,  and  in  the  channeling  of 
external  resources  into  development,  makes  it  mandatory  that  we  make  full  use 
of  our  inter-American  machinery.  The  Bank,  Inter-American  Economic  and 
Social  Council,  and  Economic  Commission  for  Latin  America;  each  must  play 
its  part.  An  excellent  beginning  has  already  been  made  with  the  creation  of  the 
new  Committee  on  Cooperation  by  our  President,  Senor  Felipe  Herrera,  and  his 
colleagues.  Dr.  Raul  Prebish  of  ECLA,  and  Dr.  Jose  Mora  of  the  OAS.  The 
opportunity  to  organize  in  concrete  terms  the  new  substantive  programs  envisaged 
in  the  Alliance  for  Progress  will  be  provided  by  the  forthcoming  Special  Ministerial 
Meeting  of  lA-ECOSOC.  The  United  States  will  have  specific  suggestions  to 
present  at  that  meeting,  and  we  will  warmly  welcome  the  suggestions  of  others. 

Meanwhile  I  should  like  to  outline  some  of  our  thinking:  It  may,  for  example, 
be  desirable  to  make  use  of  a  limited  number  of  special  working  groups  in  areas 
where  individual  country  experience  can  be  beneficially  exchanged,  or  where 
multilateral  consultations  may  be  needed,  as  in  the  formulation  of  methods  for 
employing  surplus  food  in  social  development  projects. 

We  attach  great  importance  to  the  annual  review  of  economic  and  social 
problems  and  progress  as  envisaged  by  the  Act  of  Bogota.  These  reviews  should 
provide  both  a  continuing  sense  of  direction  and  a  stimulus  for  even  greater 
efforts.  The  all  important  thing  is  that  there  be  continuous  and  productive  work 
from  which  the  member  nations  can  really  benefit.  Surveys  and  reports  serve 
no  useful  purpose  unless  they  produce  concrete  results.  We  are  also  convinced 
that  the  staff  of  IA-ECOSC)C  must  be  built  into  an  outstandingly  competent 
and  creative  secretariat — a  goal  which  we  are  happy  to  note  is  well  on  its  way  to 


360    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

fulfillment  under  the  able  leadership  of  Senor  Jorge  Sol.  The  Inter-American 
Development  Bank  is  destined  to  play  a  vital  role  in  both  the  economic  and  social 
development  sectors  of  this  great  new  effort,  not  only  as  a  lender  of  funds,  but 
also  as  a  provider  of  technical  assistance,  as  a  policy  coordinator  with  other  in- 
ternational agencies,  and  as  a  source  of  information  and  assistance  to  the  United 
States  in  the  operation  of  its  foreign  aid  programs. 

The  Inter- American  Development  Bank  has  been  chosen  by  our  governments  to 
carry  the  principal  responsibility  for  administering  the  Fund  for  Social  Develop- 
ment. We  beheve  in  the  multilateral,  cooperative  concept  which  inspired  its 
organization.  The  distinguished  President  of  the  Bank,  Felipe  Herrera,  whose 
eloquent  speech  we  have  just  heard,  was  ideally  chosen  to  direct  the  Bank's  efforts 
in  fulfilling  this  responsibility.  He,  together  with  the  Executive  Directors  and  the 
professional  staff  are  men  of  broad  experience,  intellectual  stamina,  objectivity, 
and  personal  integrity — men  well  deserving  of  the  trust  reposed  in  them. 

Our  trust  has  been  sustained  by  the  Bank's  performance.  In  the  short  period 
of  its  existence  the  Bank  has  already  approved  50  million  dollars  in  loans  to  private 
and  public  enterprises  in  eight  Latin  American  countries:  Six  loans  for  $23,750,000 
from  its  ordinary  capital  resources,  and  four  loans  for  $26,500,000  from  its  funds 
for  special  operations.  It  has  also  provided  technical  assistance  to  several 
countries  through  its  wide-ranging  missions.  Its  record  of  accomplishment  is 
outstanding.  It  has  given  high  priority  to  providing  urgently  needed  funds  for 
the  economic  development  of  small-  and  middle-size  private  enterprises.  Two 
of  its  loans  met  a  need  which  is  basic  in  many  Latin  American  countries:  increased 
supplies  to  potable  water  and  expanded  sanitation.  These  loans  provide  graphic 
examples  of  how  economic  and  social  progress  can  be  combined  in  sound  loans. 

As  testimony  to  the  soundness  of  the  Bank's  operations  fifteen  private  financial 
institutions  of  my  country  have  participated  with  the  Bank  in  its  operations. 
This,  too,  is  something  of  a  record  for  an  international  bank  still  in  its  infancy. 
The  Bank  has  also  moved  quickly  into  areas  where  economic  frustration  has 
retarded  the  march  of  progress.  It  has  faced  up  to  hard  problems.  Loans  to 
break  the  grip  of  stagnation  have  been  extended  to  Bolivia,  Haiti,  Paraguay,  and 
to  the  northeast  region  of  our  host  country,  Brazil.  There  is  a  quality  in  the 
Bank's  growth  which  has  a  special  significance — the  pervading  spirit  of  unanimity 
and  brotherhood  in  what  the  Bank  does  after  thoroughgoing  examination  and 
discussion  of  complex  issues.  The  management  and  directors  have  not  once 
failed  to  arrive  at  a  decision  which  all  could  consider  a  wise  and  forward  step. 

This  is  a  happy  augury  for  the  future  success  of  our  Alliance  for  Progress. 
Earlier  in  my  remarks,  I  said  that  we  of  the  United  States  do  not  accept  economic 
stagnation  as  a  tolerable  condition  for  the  Americas.  We  regard  both  economic 
stagnation  and  social  injustice  as  totally  intolerable.  To  us,  therefore,  economic 
and  social  progress  in  the  hemisphere  is  not  merely  a  dream  it  is  an  essential  step 
in  the  attainment  of  the  possible.  We  have  the  essential  instruments  in  our 
grasp.     Let  us  here  resolve  to  use  them  wisely  and  well. 


Exhibit  20. — Statement  by  Secretary  of  the  Treasury  Dillon,  April  28,  1961, 
before  the  Senate  Appropriations  Committee  on  the  Act  of  Bogota  and  the 
proposed  Fund  for  Social  Progress 

Before  reviewing  briefly  the  Act  of  Bogota  of  last  September,  which  constitutes 
an  important  segment  of  the  background  against  which  the  proposed  Fund  for 
Social  Progress  is  to  be  appraised,  I  would  like  to  say  a  word  about  the  second 
annual  meeting  of  the  Board  of  Governors  of  the  Inter-American  Development 
Bank  which  took  place  in  Rio  de  Janeiro  two  weeks  ago.  Inasmuch  as  the 
administration  is  proposing  that  $394  million  of  the  $500  million  Fund  requested 
will  be  administered  by  the  IDB,  attitudes  of  that  institution  toward  the  program 
are  of  major  significance. 

Second  annual  meeting  of  the  Inter-American  Development  Bank 

It  was  clearly  evident  at  this  most  recent  meeting  of  Latin  American  leaders 
that  the  spirit  of  the  Act  of  Bogota,  the  inspiration  of  President  Kennedy's  call 
for  an  "Alliance  for  Progress,"  and  the  earlier  Brazilian  appeal  to  join  in  Operation 
Pan  America  have  already  started  to  bring  about  an  effective  shift  in  age-old 
patterns  of  thought  in  Latin  America.     It  is  not  a  new  idea  for  us — the  idea  that 


EXHIBITS  361 

the  purpose  of  economic  development  is  to  achieve  an  improvement  in  the  physical, 
educational,  cultural,  and  social  life  of  all  the  people.  But  as  that  idea  becomes 
more  and  more  widely  accepted  as  a  basis  for  action  by  the  leaders  of  Latin 
America,  it  will  constitute  a  basic  prerequisite  for  sound,  sustainable  economic 
growth.  The  spread  of  this  idea  will  create  social  ferment,  but  it  will  provide 
the  best  hope  for  avoiding  social  explosions. 

One  Latin  American  statesman  at  Rio  de  Janeiro  interpreted  the  new  spirit  of 
Latin  American  progress  in  these  words: 

"Progress,  economic  growth,  expansion  of  wealth,  industrialization,  expansion 
of  markets,  substantial  increase  in  bujdng  power,  whatever  words  you  use,  we 
all  understand  the  concept.  But  we  do  not  believe  in  the  methods  of  the  Pharaohs. 
We  do  not  believe  in  their  present-day  counterpart,  totalitarian  methods,  which 
consist  in  planning  great  works  but  with  the  sacrifice  of  millions  of  human  beings 
and  of  several  generations.  Therefore  we  must  think  in  terms  of  the  human  being 
of  today,  not  as  a  figure  of  statistics  but  as  a  man  of  flesh  and  blood,  who  lives 
and  breathes,  who  knows  hunger,  perhaps  is  attacked  by  sickness  requiring  medical 
attention,  lacks  schools,  needs  a  roof  over  his  head,  and  longs  for  a  bit  of  land  to 
work  and  to  call  his  own  and  to  be  able  to  pass  on  to  his  children,  the  present 
living  conditions  of  our  peoples  in  many  cases  are  terribly  difficult.  Therefore 
paralleling  a  plan  of  economic  growth,  we  must  carry  forward  without  delay  a  bold 
and  creative  program  of  social  betterment." 

I  was  impressed  not  only  by  the  enthusiasm  with  which  speaker  after  speaker 
endorsed  the  theme  that  economic  progress  and  social  progress  must  go  hand  in 
hand,  but  also  by  the  widespread  recognition  that  the  new  Alliance  for  Progress 
demands  self-help  measures  on  the  part  of  the  Latin  American  countries  as  a  pre- 
condition for  assistance  from  the  Social  Progress  Fund  which  you  are  considering 
today.  Senor  Herrera,  President  of  the  IDB,  pointed  out  that  there  should  be  no 
illusions  that  the  Social  Development  Fund  will  provide  a  direct  solution  to  the 
social  requirements  and  problems  of  Latin  America.  He  said:  "The  Fund  will  not 
act  as  a  charitable  institution  but  as  a  device  contributing  to  the  effort  of  such 
Latin  American  countries  as  are  concerned  with  surmounting  social  obstacles  to 
their  economic  progress." 

In  the  short  span  of  seven  months  between  the  conference  at  Bogota  and  the 
recent  conference  in  Rio,  very  substantial  advaiices  have  been  made  in  creating 
a  unified  and  consistent  concept  of  the  type  of  economic  and  social  growth  we  are 
seeking  in  Latin  America. 

I  would  like  tojexpress  my  appreciation  for  the  fact  that  among  my  advisers  at 
the  Rio  meeting  were  Senator  Fulbright  and  Senator  Hickenlooper,  and  Repre- 
sentatives Kilburn  and  Rains.  Senator  Morse  and  Senator  Hickenlooper  were 
members  of  our  earlier  delegation  to  the  conference  in  Bogota.  The  report  of  the 
last  two  Senators  on  the  Bogota  Conference  is  an  excellent  summary  review  and 
analysis  of  that  meeting. 

The  Bogota  Conference 

The  conference  held  in  Bogota,  Colombia,  in  September  of  last  year  was  the 
third  full-scale  meeting  of  the  Subcommittee  to  Study  the  Formulation  of  New 
Measures  for  Economic  Cooperation. 

This  group,  popularly  known  as  the  "Committee  of  21,"  was  first  convened  by 
the  Organization  of  American  States  in  November  1958  in  Washington,  to  give 
specific  form  and  content  to  Operation  Pan  America.  This  was  the  name  given  by 
the  then  President  of  Brazil  to  the  stirring  appeal  he  had  voiced  in  June  of  that 
year  for  closer  cooperation  within  the  Americas,  in  order  to  preserve  and  defend 
Western  values  of  democratic  government  and  personal  freedom  by  joining  in  a 
concerted  attack  on  underdevelopment  and  poverty.  The  committee  met  again 
in  the  spring  of  1959  in  Buenos  Aires. 

The  Brazilian  appeal  embodied  in  Operation  Pan  America,  like  the  call  of 
President  Kennedy  for  an  "Alliance  for  Progress,"  dramatized  the  growing  desire 
through  the  hemisphere  for  a  collective  attack  upon  the  social  and  economic 
problems  of  the  Americas. 

The  United  States  delegation  went  to  the  Bogota  Conference  with  an  unusually 
favorable  opportunity  to  present  a  positive  and  forward-looking  program  to  the 
other  American  Republics.  This  opportunity  existed  because  of  the  action  of  the 
Congress  last  September  in  authorizing  appropriation  to  the  President  of  $500 
million  to  be  used  in  assisting  those  Latin  American  countries  which  were  prepared 


362   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

to  support  programs  designed  to  further  social  progress  in  their  respective  coun- 
tries. 

Early  in  the  Conference,  the  United  States  delegation  introduced  a  draft  docu- 
ment proposing  a  great  cooperative  effort  to  achieve  these  goals.  After  intensive 
consideration,  based  on  this  draft,  the  Act  of  Bogota  was  evolved  and  approved 
by  the  Conference.  You  will  find  the  full  text  in  Annex  B  of  the  presentation 
book. 

I  should  like  to  stress  at  this  point  the  emphasis  which  the  Act  of  Bogota  as 
finally  agreed  placed  upon  self-help  measures.  The  preamble  of  the  act  recognizes 
that  the  success  of  the  cooperative  program  of  economic  and  social  progress  will 
require  maximum  self-help  efforts  on  the  part  of  the  American  Republics.  Chap- 
ter I  consists  of  an  outline  of  a  program  for  social  development  in  which  the  partici- 
pating countries  undertake  to  examine  existing  legal  and  institutional  systems 
dealing  with  land  tenure  legislation,  agricultural  credit  institutions,  tax  systems, 
and  fiscal  policies  as  they  affect  use  of  land.  Similar  examination  is  called  for  in 
connection  with  measures  for  improving  housing  and  community  facilities,  the 
reexamination  of  educational  systems,  measures  for  improving  public  health,  and 
measures  for  mobilizing  domestic  resources  with  a  view  to  providing  additional 
revenues  to  assist  in  accomplishing  the  purposes  of  the  act. 

In  Chapter  II  of  the  Act  of  Bogota,  the  other  American  Republics  welcome  the 
decision  of  the  United  States  to  establish  a  special  inter-American  fund  for  social 
development  "to  support  the  efforts  of  the  Latin  American  countries  that  are 
prepared  to  initiate  or  expand  effective  institutional  improvements  and  to  adopt 
measures  to  employ  efficiently  their  own  resources,  with  a  view  to  achieving 
greater  social  progress  and  more  balanced  economic  growth." 

The  introduction  of  the  U.S.  proposal  to  the  meeting  rapidly  set  the  tone  of  the 
entire  Bogota  Conference.  All  other  topics  on  the  agenda  were  subordinated  to 
the  task  of  drafting  the  Act  of  Bogota.  The  tone  of  the  Conference  was  one  of 
enthusiastic  and  friendly  cooperation  in  working  out  agreement  on  detailed  areas 
of  activity  in  which  the  Latin  American  countries  recognized  the  need  for  self- 
help  measures  in  support  of  which  the  proposed  Fund  for  Social  Progress  would 
provide  assistance. 

The  only  discordant  note  was  sounded  by  representatives  of  the  Government  of 
Cuba.  Cuba  did  not  sign  the  Act  of  Bogota  and  will  not  be  eligible  for  assistance 
from  the  proposed  Social  Progress  Fund  so  long  as  it  continues  to  isolate  itself 
from  cooperative  efforts  in  this  hemisphere.  The  Dominican  Republic  was  not 
present  at  the  Conference  and  will  not  be  eligible  for  assistance  so  long  as  it  is 
subject  to  economic  or  diplomatic  sanctions  by  the  Organization  of  American 
States. 

Chapter  III  of  the  Act  of  Bogota,  which  deals  with  measures  for  economic 
development,  emphasizes  a  very  important  point — that  the  Social  Progress  Pro- 
gram is  designed  to  supplement,  not  to  supplant  in  any  degree,  the  essential 
measures  needed  for  economic  development. 

Social  progress  and  economic  development  are  not  separate  and  independent 
efforts.  They  are  mutually  reenforcing.  Fundamentally,  social  progress  is  an 
added  dimension  to  economic  growth,  the  dimensions  of  a  broader  distribution  of 
the  benefits  of  growth  and  genuine  participation  in  the  development  process  by  all 
segments  of  the  population.  Economic  development  can  take  place  without  ade- 
quate social  progress.  But  sustained  social  progress  cannot  take  place  without 
economic  development. 

I  think  we  will  find  as  the  years  go  by  that  the  Act  of  Bogota  will  be  regarded  as 
one  of  the  truly  historic  documents  of  human  progress  in  this  hemisphere.  It  is 
taken  very  seriously  by  the  Latin  American  countries.  One  very  encouraging  develop- 
ment since  the  close  of  the  meeting  in  Bogota  is  the  agreement  of  the  Organization 
of  American  States  and  the  United  Nations  Economic  Commission  for  Latin 
America  to  sponsor  a  long-range  program  to  strengthen  Latin  American  tax 
systems  within  the  context  of  the  Act  of  Bogota.  This  work  will  be  carried  out  in 
cooperation  with  tlie  Harvard  Law  School's  International  Program  in  Taxation. 
The  Inter-American  Development  Bank  will  participate  in  certain  phases  of  the 
program.  A  conference  in  Latin  America  on  tax  administration  is  planned  for 
this  fall  to  be  followed  by  another  conference  on  tax  pohcy  early  next  year. 


EXHIBITS  363 

Use  of  the  Inter-American  Development  Bank  as  a  primary  mechanism  in  ad- 
ministering the  proposed  Fund 

Secretary  Ball  has  rightly  stressed  the  desirability  of  using  an  inter-American 
agency  for  administering  a  substantial  portion  of  the  proposed  Fund  for  Social 
Progress.  This  applies  to  the  fields  of  improved  land  use,  housing,  and  sanitation 
which  are  appropriate  for  financing  mainly  on  a  loan  basis.  The  fields  of  education 
and  health,  which  are  proposed  for  bilateral  assistance  mainly  on  a  grant  basis, 
are  of  course  equally  essential  parts  of  the  Bogota  program  as  a  whole. 

When  the  Social  Development  Program  was  presented  to  the  Congress  last  year 
it  was  suggested  that  a  substantial  proportion  of  the  funds  available  should  be 
channeled  through  the  Inter-American  Development  Bank.  The  same  proposal 
was  enthusiastically  endorsed  by  representatives  of  the  Latin  American  govern- 
ments at  the  Bogota  Conference  and  the  Act  of  Bogota  contemplates  that  the 
Inter-American  Development  Bank  will  be  the  "primary  mechanism"  for  the 
administration  of  the  proposed  Fund. 

Operating  on  the  conviction  that  social  progress  is  an  added  dimension  to  eco- 
nomic growth  it  appears  highly  appropriate  that  the  Inter-American  Development 
Bank,  which  was  created  "to  contribute  to  the  acceleration  of  economic  develop- 
ment in  Latin  America,"  should  be  entrusted  with  additional  funds  to  handle  this 
additional  dimension  of  the  problem.  Both  economic  development  and  social 
development  must  be  carried  on  with  due  attention  to  the  total  allocation  of  a 
nation's  resources,  both  those  domestically  available  and  those  provided  through 
external  assistance.  The  staff  of  the  Bank  is  Iiighly  qualified  to  deal  with  both 
these  problems. 

The  Act  of  Bogota  emphasizes  necessary  improvement  of  institutions  for 
mobilizing  domestic  resources.  Such  improvement  will  involve  consideration  of 
tax  sj'stems,  the  stim.ulation  of  capital  markets,  the  organization  of  local  savings 
and  loan  institutions.  These  are  all  areas  in  which  the  Inter-American  Develop- 
ment Bank  and  its  specialized  personnel  will  have  particular  competence. 

The  Inter-American  Development  Bank  is  already  showing  its  ability  to  handle 
the  important  functions  with  which  it  has  been  entrusted.  It  opened  its  doors 
for  business  on  October  1,  1960.  At  the  second  annual  meeting  in  Rio  this  month 
the  President  of  the  Bank  was  able  to  announce  that  the  Bank  had  already  ap- 
proved ten  credit  operations  with  a  total  value  of  $50.2  million.  He  forecast 
that  this  amount  might  be  doubled  within  the  next  three  months.  The  loans  had 
involved  Peru,  Bolivia,  Paraguay,  Haiti,  Nicaragua,  Brazil,  Chile,  and  Colombia. 
The  President  of  the  Bank  also  announced  that  520  loan  requests  or  inquiries  had 
been  received  by  the  Bank  up  to  the  end  of  February  1961.  Of  the  loan  requests, 
118  involving  an  estimated  $240  million  were  being  given  further  study  and  24 
loan  requests,  involving  $60  million,  were  in  an  advanced  stage  of  analysis  and 
consideration. 

The  management  of  the  Bank  has  the  full  confidence  of  the  United  States  and 
the  enthusiastic  support  of  the  Latin  American  countries  which  have  contributed 
to  its  resources  and  regard  it  as  an  institution  wholly  devoted  to  economic  advance 
in  the  Americas.  This  was  made  abundantly  clear  during  the  course  of  the 
second  annual  meeting  in  Rio  de  Janeiro. 

The  President  of  the  Bank  is  Mr.  Felipe  Herrera.  He  is  a  distinguished  Chilean 
who  formerly  served  his  country  as  Minister  of  Finance  and  as  General  Manager 
of  Chile's  Central  Bank.  The  Executive  Vice  President  is  Mr.  T.  Graydon  Upton 
of  the  United  States  who  was  formerly  Assistant  Secretary  of  the  Treasury.  All 
the  Executive  Directors  have  had  broad  experience  with  both  the  economic  and 
social  problems  of  the  area. 

Mr.  Ball  has  explained  the  arrangements  we  have  in  mind  for  entrusting  the 
managem.ent  of  a  substantial  portion  of  these  funds  to  the  Inter-American  Devel- 
opment Bank.  We  expect  to  benefit  from  the  wide  knowledge  and  experience  of 
the  Bank's  Board  of  Executive  Directors  and  from  the  work  of  the  Bank's  staff 
which  has  already  demonstrated  high  competence  and  a  strong  sense  of  responsi- 
bility both  to  the  shareholders  and  to  the  clients  of  the  Bank.  At  the  same  time, 
all  decisions  regarding  use  of  the  moneys  entrusted  to  the  Bank  from  the  Social 
Progress  Fund  will  be  taken  by  a  two-thirds  vote  of  the  Board  of  Executive 
Directors.  This  means  that  the  Executive  Director  representing  the  United 
States,  who  casts  over  40  percent  of  the  total  votes,  will  be  in  a  position  to  prevent 
favorable  action  on  any  particular  loan  proposal  not  clearly  in  harmony  with  the 
principles  of  the  Act  of  Bogota. 


614359—62 24 


364   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Exhibit  21. — Remarks  by  Secretary  of  the  Treasury  Dillon,  May  2,  1961,  before 
the  U.S.  Council  of  the  International  Chamber  of  Commerce,  New  York,  N.Y. 

The  most  important  single  problem  confronting  our  Nation  in  the  field  of 
international  finance  today  is  how  to  achieve  and  maintain  overall  balance  in 
onr  international  payments,  the  accounting  which  shows  the  results  of  all  of  our 
trade  and  financial  relations  with  the  rest  of  vhe  world. 

It  is,  I  am  aware,  a  problem  with  which  the  members  of  the  United  States 
Council  of  the  International  Chamber  of  Commerce  are  deeply  concerned.  It 
is  also  a  problem  that  you  are  in  a  position  to  help  resolve  in  our  country's  favor, 
for  I  know  of  no  group  which  has  greater  influence  upon  our  international  trade 
and  payn^ents.     I  am,  therefore,  extremely  pleased  to  be  here  with  you  tonight. 

The  facts  of  our  international  payments  position  have  been  widely  discussed  in 
the  past  two  years.  At  times  they  have  been  both  overdramatized  with  unfounded 
alarm  and  underplayed  with  unwarranted  complacency.  To  help  put  them  into 
proper  focus,  let  me  review  them  briefly: 

From  the  beginning  of  1951  to  the  end  of  1956,  when  European  currencies 
were  approaching  convertibility,  the  United  States  ran  a  deficit  in  its  balance  of 
payments  which  averaged  one  billion  two  hundred  million  dollars  a  year.  The 
total  deficit  for  these  eix  years  was  seven  billion  two  hundred  million  dollars. 

During  that  critical  period  of  recovery  from  the  ravages  of  World  War  II, 
these  deficits  played  a  useful  role.  They  helped  to  rebuild  the  shattered  financial 
structures  of  other  free  nations.  They  helped  to  bring  the  worldwide  dollar 
shortage  to  an  end.  They  gave  to  Western  Europe  the  extra  reserves  needed  to 
restore  convertibility  to  their  currencies,  thus  releasing  free  world  trade  and 
payments  from  exchange  controls.  This  convertibility  of  the  major  currencies — ■ 
which  is  of  great  benefit  to  the  export  trade  of  the  United  States,  but  which  had 
not  existed  since  before  World  War  II — was  achieved  for  all  practical  purposes 
at  the  end  of  1958  and  was  formally  recognized  by  the  International  IVIonetary 
Fund  just  last  February. 

The  deficits  of  1951-56  generated  only  a  small  outflow  of  gold  from  the  United 
States.  They  were  reflected  instead  by  increases  in  foreign  liquid  dollar  holdings, 
which  became  a  part  of  the  monetary  reserves  of  our  friends  and  allies  abroad. 
The  importance  of  the  dollar  as  a  reserve  currency  was  thereby  greatly  increased. 
So,  consequently,  was  the  responsibility  of  the  United  States  to  maintain  the 
value  of  the  dollar  as  a  reserve  currency. 

1957,  when  the  United  States  ran  a  moderate  surplus,  saw  a  temporar}-  change 
in  our  balance  of  payments.  However,  this  surplus  resulted  from  the  Suez  crisis, 
which  brought  with  it  heavily  increased  purchases  of  American  petroleum  and 
other  goods  and  did  not  signify  a  basic  shift  in  our  payments  position. 

In  1958  we  again  returned  to  a  deficit,  but  this  time  on  a  very  large  scale;  a 
deficit  of  three  billion  five  hundred  million  dollars,  almost  triple  the  1951-56 
average.  The  following  year  our  deficit  rose  to  three  billion  eight  hundred  million 
dollars.     And  last  year  it  once  again  reached  three  billion  eight  hundred  million. 

In  contrast  to  the  pre-Suez  years,  the  deficits  of  1958-60  were  accompanied  by 
substantial  outflows  of  gold  from  the  United  States  which  in  part  reflected  the 
decision  of  some  foreign  countries  to  revert  to  their  customary  practice  of  holding 
in  gold  a  larger  share  of  their  overall  monetary  reserves. 

In  looking  back  at  1960,  when  there  was  a  large  outflow  of  short-term  capital, 
it  is  quite  apparent  that  our  traditional  method  of  measuring  a  deficit  can  be  mis- 
leading in  this  new  era  of  convertible  currencies.  Because  of  currency  converti- 
bility, short-term  capital  movements  last  year  were  on  a  scale  not  seen  since  the 
Twenties.  These  movements  initially  resulted  from  difi"erences  between  the 
short-term  interest  rates  then  prevailing  in  the  United  States  and  those  then  pre- 
vailing in  other  financial  centers.  Last  fall,  speculative  transactions  also  added 
to  the  outflow^  But  these  movements  did  not  reflect  persisting  forces  in  our 
balance  of  payments. 

To  put  it  simply,  when  an  American  transfers  his  money  from  New  York  to 
invest  at  short-term  in  London  or  Frankfurt,  he  purchases  sterling  or  deutsche 
marks  with  dollars — thus  increasing  the  United  States  "deficit"  in  the  conven- 
tional sense.  However,  he  also  acquires  a  short-term  claim  in  the  same  amount 
against  sterling  or  deutsche  marks,  a  claim  that  can  be  quickly  reconverted  to 
dollars  whenever  he  decides  to  shift  his  funds  back  home.  Consequently,  to  in- 
clude such  short-term  capital  outflows  in  our  deficit  is  to  record  liabilities  without 
recording  equivalent  assets.  This  has  the  efi'ect  of  making  the  payments  posi- 
tion of  recipient  countries  appear  stronger  than  they  really  are,  and  of  making 
our  position  appear  weaker  than  it  really  is. 


I 


EXHIBITS  365 

Nevertheless,  heavy  short-terra  capital  outflows  can,  and  last  year  did,  result 
in  large  transfers  of  gold.  They  pose  a  severe  threat  to  international  financial 
relationships  because  they  can  bring  loss  of  confidence  in  their  v/ake.  Closer 
international  cooperation  is  therefore  required  to  prevent  excessive  difl'erentials 
in  interest  rates  and  other  conditions  which  may  stimulate  such  outflows.  Hence, 
we  are  now  regularly  consulting  with  friendly  financial  and  central  bank  officials 
in  order  to  achieve  the  needed  coordination.  We  hope  to  continue  and  improve 
these  consultations  through  the  new  Organization  for  Economic  Cooperation  and 
Development  and  in  other  appropriate  ways. 

Now,  as  to  our  "basic"  deficit: 

If  estimated  short-term  capital  movements  are  excluded  from  the  international 
accounts  of  the  United  States,  we  find  that  our  basic  deficit  in  1960  was  not  three 
billion  eight  hundred  million,  but  nearer  one  billion  five  hundred  million  dollars. 
It  is  this  deficit  which  is  the  persisting  hard  core  of  our  balance-of-payments 
problem. 

How  is  this  basic  deficit  created?  By  the  simple  circumstance  that,  even 
though  we  have  large  export  surpluses,  they  have  not  been  sufficient  to  meet  the 
expenditures  we  must  make  abroad  in  our  national  interest  to  maintain  our 
military  installations,  to  conduct  our  foreign  economic  assistance  programs,  and 
to  cover  the  investment  of  private  capital  and  the  transfer  of  private  remittances. 
In  1960  our  export  surplus  of  goods  and  services  amounted  to  almost  seven  billion 
dollars.  But  our  major  nontrade  expenditures  were  over  eight  and  a  half  billion 
dollars:  Three  billion  dollars  for  our  military  forces  abroad,  two  billion  eight 
hundred  million  dollars  for  economic  assistance,  two  billion  dollars  for  net  long- 
term  United  States  private  investment  abroad  and  foreign  investment  in  this 
countrj',  and,  finally,  eight  hundred  million  dollars  for  remittances. 

The  cry  is  sometimes  raised  that  we  could  solve  our  payments  problem  by 
curtailing  our  programs  of  economic  aid  to  needy  peoples  in  Asia,  Africa,  and 
Latin  America.  This  is  as  unrealistic  as  it  is  fallacious.  It  is  unrealistic  because 
our  assistance  to  the  new  and  developing  countries  is  critically  necessary  to  our 
own  survival  as  members  of  the  free  world.  It  is  fallacious  because  most  of  our 
foreign  economic  assistance  is  in  the  form  of  U.S.  goods  and  services  which  would 
not  otherwise  enter  our  export  picture.  These  goods  and  services  are  a  vital 
contribution  to  the  developing  countries  and  go  to  areas  which  cannot  afford  to 
pay  cash  for  them.  They  are  also  an  important  contribution  to  our  export 
surplus,  since  foreign  aid  shipments  aie  included  in  our  commercial  export 
statistics. 

For  instance,  in  1960  it  is  estimated  that  over  two  billion  dollars  of  our  two 
billion  eight  hundred  million  dollar  total  of  foreign  economic  assistance  repre- 
sented payments  for  U.S.  goods  and  services.  As  a  matter  of  fact,  taking  mer- 
chandise alone,  goods  shipped  from  the  United  States  under  our  foreign  economic 
aid  programs  were  equivalent  to  nearly  half  of  our  merchandise  export  surplus. 

In  attacking  our  basic  payments  problem,  the  administration  is  seeking  to 
avoid  damage  to  our  national  security  and  to  take  actions  consistent  with  our 
international  obligations.     President  Kennedy  has  been  moving  on  many  fronts: 

The  Export-Import  Bank  is  expanding  its  export  credit  guaranty  program. 

The  President  has  requested  tax  legislation  as  an  investment  incentive  to 
American  business  designed  to  help  modernize  our  plant  and  improve  our  com- 
petitive position  in  export  markets. 

Our  military  and  economic  assistance  programs  are  being  administered  so  as 
to  place  primary  emphasis  upon  procurement  of  American  goods. 

The  Congress  is  preparing  to  act  on  administration  legislation  cutting  down 
on  duty-free  tourist  allowances  in  order  to  reduce  the  encouragement  to  U.S. 
travelers  to  spend  their  dollars  abroad. 

Through  the  promotion  of  foreign  travel  to  the  United  States  and  of  foreign 
investment  in  the  United  States,  we  are  endeavoring  to  increase  our  receipts  on 
service  and  capital  accounts. 

We  are  examining  the  possibilities  of  strengthening  the  international  monetary 
system. 

We  are  seeking  through  the  Organization  for  Economic  Cooperation  and  De- 
velopment to  encourage  increased  economic  development  contributions  by  other 
industralized  countries,  as  well  as  to  improve  international  cooperation  so  as  to 
moderate  the  size  and  violence  of  shifts  of  short-term  capital. 

The  combination  of  these  measures  will,  we  hope,  do  a  great  deal  to  solve  our 
balance-of-payments  problem.  As  for  the  immediate  outlook,  I  am  sure  you  will 
want  to  know  how  we  are  doing  so  far  in  1961.     Since  only  pi-eliminary  figures 


366   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

are  at  hand,  all  that  I  can  tell  you  is  necessarily  tentative.  We  have  had  a  sub- 
stantial improvement  in  our  payments  position  during  the  first  quarter  of  1961. 
Our  expoit  surplus  remains  high.  Confidence  in  the  dollar  has  been  restored. 
Gold  stopped  flowing  out  after  February  and  there  was  a  small  inflow  during 
March.  It  is  probable  that  our  usual  "basic"  deficit  was  replaced  by  a  modest 
surplus  for  the  first  quarter  of  this  year.  But,  because  of  the  continuing  outflow 
of  short-term  funds,  even  though  at  a  much  lower  rate,  we  still  recorded  an 
overall  loss  of  gold  and  dollars  for  the  period.  This  relatively  modest  loss  was, 
however,  in  sharp  contrast  to  the  very  large  loss  of  the  previous  quarter. 

The  substantial  improvement  in  our  balance-of-pa3^ments  position  during  the 
first  quarter  has  been  gratifying.  But  the  long-term  problem  has  not  yet  been 
solved.  The  attainment  and  maintenance  of  reasonable  equilibrium  in  our  inter- 
national payments  and  receipts  must  remain  a  major  national  objective. 

Although  the  surplus  in  our  exports  of  goods  and  services  has  recently  con- 
tinued to  grow,  the  growth  has  been  small  and  the  rise  has  been  due  almost 
entirely  to  a  continued  decline  in  our  imports,  for  exports  have  remained  fairly 
constant.  A  substantial  pai't  of  our  recent  improvement  has  resulted  from  the 
simultaneous  occurrence  of  a  boom  in  Europe  and  a  recession  here  at  home — a 
situation  which  cannot  be  expected  to  continue  indefinitely. 

Although  we  must  spare  no  efl'ort  to  strengthen  our  export  surplus,  we  cannot 
overlook  other  possibilities  for  strengthening  our  position.  A  major  area  is 
capital  transactions,  including  long-term  investments,  which  have  an  important 
impact  on  our  international  payments. 

Our  past  direct  investments  have  built  a  strong  base  for  present  and  future 
net  income  from  abroad.  Indeed,  in  1960  we  received  two  billion  four  hundred 
million  dollars  from  this  source.  But  we  must  realize  that,  while  the  earnings 
remitted  from  investments  which  we  have  built  up  abroad  over  the  years  are 
substantial,  they  still  are  being  offset  to  a  very  sizable  extent  by  }^early  outflows 
of  new  capital.  This  is  particularly  true  in  the  case  of  the  industrialized  coun- 
tries. For  instance,  new  capital  outflows  to  Western  Europe  and  Canada  gen- 
erally exceed  the  return  flow  from  these  same  areas. 

While  it  is  in  our  national  interest  to  continue  to  promote  direct  U.S.  invest- 
ment in  countries  in  the  earlier  stages  of  development  so  that  they  may  benefit 
from  American  capital,  technical  know-how,  and  managerial  skills,  we  do  not  see 
any  reason  why  we  should  continue  to  provide  special  incentives  for  U.S.  invest- 
ment in  the  prospering  industrialized  countries.  We  believe  the  time  has  come 
to  terminate  incentives  in  our  tax  la^ws  that  enable  American  companies  to  defer 
payment  of  U.S.  income  tax  on  the  unremitted  earnings  of  their  subsidiaries  in 
these  countries. 

The  tax-deferral  privilege,  as  it  is  called,  has  fostered  the  use  of  tax  "havens", 
which  permit  enterprises  to  pay  very  little  tax,  or  to  escape  paying  taxes  alto- 
gether, either  to  the  United  States  or  to  the  country  in  which  their  business  is 
principally  conducted.  This  is  most  clearly  demonstrated  by  the  stampede  to 
Switzerland,  where  over  two  hundred  new  American-owned  companies  were  es- 
tablished during  the  past  year. 

In  addition  tax  deferral  inevitably  favors  investment  abroad  over  investment 
at  home.  Other  things  being  equal,  companies  are  naturally  inclined  to  invest 
where  tax  rates  are  lowest.  Corporate  income  tax  rates  in  some  European 
countries  are  a  bit  lower  than  in  the  United  States,  although  in  Germany,  France, 
and  England  the  differential  is  virtually  nonexistent.  The  elimination  of  tax 
deferral  will  not  have  a  substantial  effect  on  companies  operating  in  these  coun- 
tries and  it  w-ill  promote  equity  by  placing  investment  at  home  and  abroad  on  a 
fully  equal  footing. 

While  it  is  difficult  to  make  exact  estimates,  we  believe  that  elimination  of  the 
tax-deferral  privilege  in  industrialized  countries  and  the  restriction  of  tax  havens 
everywhere,  will  yield  some  two  hundred  and  fifty  million  dollars  annually  in 
additional  taxes — plus  a  substantial  additional  amount  in  balance-of-payments 
savings.  This  represents  a  significant  and  much-needed  contribution  to  the 
solution  of  our  long-range  balance-of-payments  problem. 

In  conclusion,  I  should  like  to  say  just  a  few  words  about  the  relationship 
between  our  balance  of  payments  and  our  domestic  economy: 

The  two  largest  items  by  far  in  our  international  accounts  are  exports  and 
imports. 

As  our  economic  activity  expands,  we  normally  may  expect  an  increase  in 
imports.  At  the  same  time  we  may  experience  upward  pressures  on  domestic 
prices  which  would  bring  with  them  a  decline  in  exports.     We  must  resist  these 


EXHIBITS  367 

pressures.  This  is  essential  if  we  are  to  maintain  and  improve  our  position  in 
world  markets.  Our  export  prices  must  continue  to  be  fully  competitive  if  we 
are  to  achieve  a  sustainable  equilibrium  in  our  balance  of  payments.  We  cannot 
relax,  for  there  will  be  no  letup  in  the  growing  pressure  of  worldwide  competition. 


Exhibit  22. — Statement  by  Secretary  of  the  Treasury  Dillon,  May  10,  1961, 
before  a  Subcommittee  of  the  House  Committee  on  Banking  and  Currency 
on  a  proposed  amendment  to  the  Articles  of  Agreement  of  the  International 
Finance  Corporation 

I  appear  before  you  today  in  support  of  H.R.  6765,  authorizing  the  approval 
by  the  United  States  of  a  proposed  amendment  to  the  Articles  of  Agreement 
of  the  International  Finance  Corporation  which  would  permit  the  Corporation 
to  make  equitv  investments  under  limited  conditions. 

This  amendment  would  have  a  significant  effect  in  stepping  up  the  rate  at 
which  the  Corporation  is  able  to  invest  in  its  less-developed  member  countries 
and  would  thereby  further  the  purposes  for  which  the  Corporation  was  established. 

The  proposed  agreement  has  been  carefuUy  considered  by  the  Corporation  and 
is  unanimously  recommended  by  its  Board  of  Directors. 

This  is  the  first  time  since  the  IFC's  creation  in  1956  that  a  matter  concerning 
it  has  been  before  this  committee.  It  may,  therefore,  be  helpful  to  review  the 
origins  of  the  Corporation  and  its  work. 

The  IFC  war  established  as  an  affiliate  of  the  International  Bank  for  Recon- 
struction and  Development,  or  World  Bank,  whose  outstanding  record  the 
committee  knows  well.  Any  country  which  is  a  member  of  the  Bank  may  become 
a  member  of  the  IFC,  and  59  of  the  Bank's  68  members  have  now  joined  the 
Corporation.  The  total  authorized  capital  of  the  Corporation  is  $100  million. 
Present  members  have  actually  paid  in  $96.6  million  in  dollars.  The  United 
States  subscription,  which  we  paid  when  we  joined  in  1956,  is  $35.2  million. 

While  the  Corporation  has  cooperated  closely  with  the  World  Bank  since  its 
inception,  its  relationship  to  the  Bank  wiU  be  even  closer  in  the  future.  The 
President  of  the  Corporation,  Mr.  Garner,  has  announced  his  intention  to  retire 
this  fall  after  the  annual  meeting.  Mr.  Eugene  Black,  President  of  the  World 
Bank,  has  agreed  to  take  on  the  added  duty  of  the  Presidency  of  the  International 
Finance  Corporation  at  that  time.  This  will  ensure  the  closest  possible  co- 
ordination between  the  operations  of  these  tw^o  important  institutions. 

The  idea  behind  the  Corporation  is  a  simple  one.  It  is  that  a  multilateral 
source  of  capital  should  be  available  to  give  direct  encouragement  to  the  stimula- 
tion and  growth  of  private  enterprise  in  the  less-developed  countries  of  the  free 
world.  The  Corporation  seeks  to  accomplish  this  by  providing  "seed  capital," 
that  extra  margin  which  may  very  well  determine  whether  private  funds  are 
willing  to  go  in. 

In  practice  the  Corporation  has  invested  in  small  or  medium  private  enterprise 
projects.  What  is  often  regarded  as  a  small  private  firm  in  a  large  industrialized 
nation  may  be  a  good-sized  undertaking  in  many  of  the  less-developed  countries 
with  which  the  Corporation  deals. 

Most  of  the  enterprises  assisted  by  the  Corporation  are  engaged  in  light  and 
medium  manufacturing  in  such  fields  as  furniture,  rubber  products,  automotive 
components  and  replacement  parts,  electrical  equipment,  steel  products,  and  food 
packing.  A  number  of  firms  in  which  IFC  has  invested  produce  basic  materials 
such  as  cement,  bricks,  lumber  products,  fertilizers,  and  paper  pulp.  AH  of  the 
firms  have  aided  local  economies  by  providing  additional  employment,  and  all 
contribute  importantly  to  the  growth  of  the  private  sector  of  the  developing 
economies. 

During  the  approximately  four  years  of  its  operations  the  Corporation  has 
made  investment  commitments  totaling  $44.8  million,  of  which  $29.3  million 
has  actually  been  disbursed.  The  average  size  of  its  investments  is  about  one 
and  one-quarter  million  dollars.  Thirty-six  investment  commitments  have 
been  made  in  seventeen  countries.  In  each  case  additional  private  invest- 
ment funds  have  been  committed  alongside  the  IFC.  These  private  investments 
have  amounted  to  over  $125  million  or  nearly  $3.00  of  new  private  investment 
for  each  $1.00  of  IFC  investment. 

In  carrying  forward  its  operations  the  Corporation  has  been  severely  limited 
by  the  provision  in  Article  III,  Section  2(a)  of  its  Articles  that:  ".  .  .  financing 
[by  the  Corporation]  is  not  to  take  the  form  of  investments  in  capital  stock." 


368    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

As  I  indicated  in  my  letter  of  April  4,  1961,  to  the  Speaker  of  the  House,  this 
limitation  has  tended  to  constrict  the  desirable  flexibility  of  the  Corporation  in 
making  risk  capital  available  to  less-developed  economies.  Because  of  this 
limitation  the  Corporation  has  had  to  resort  to  the  use  of  convertible  debentures 
or  long-term  stock  options,  that  is,  instruments  which  are  not  themselves  com- 
mon stock  and  may  be  converted  to  common  stock  only  under  prescribed  con- 
ditions and  only  after  they  have  been  transferred  out  of  the  hands  of  the  Corpora- 
tion. However,  convertible  debentures  are  not  well-known  in  foreign  capital 
markets,  especially  in  the  developing  countries.  In  many  of  these  countries 
legal  provisions  for  the  issuance  of  such  debentures  do  not  exist.  Arrangements 
for  long-term  stock  options  have  involved  techniques  which  are  legally  complex 
and  present  substantial  negotiating  difficulties.  A  detailed  explanation  of  these 
problems  and  of  the  need  for  authority  to  make  equity  investments  is  contained 
in  a  memorandum  dated  February  10,  1961,  from  the  President  of  the  Corpora- 
tion which  I  would  like  to  submit  for  the  record  at  this  point.  In  sum,  the 
charter  limitation  or  the  purchase  of  capital  stock  has  severely  restricted  the 
ability  of  the  Corporation  to  carry  out  its  primary  function  of  stimulating  private 
enterprise  in  the  less-developed  areas. 

The  original  reason  for  including  a  prohibition  against  equity  investment  in  the 
Articles  of  Agreement  was  to  insure  that  the  Corporation  would  not  as  a  result  of 
stock  ownership  have  management  responsibilities  in  the  private  enterprises  in 
which  it  invested.  Su3h  responsibihties  properly  he  with  the  private  owners  of 
the  enterprise.  This  concept  is  a  sound  one  and  remains  applicable  today. 
However,  safeguards  have  been  incorporated  in  the  proposed  amendment  to 
insure  that  the  Corporation  will  not  become  involved  in  the  operational  or  man- 
agement decisions  of  the  enterprises  in  which  it  invests. 

The  form  of  the  proposed  amendment  to  the  Articles  of  Agreement  is  embodied 
in  the  proposed  Resolution  of  the  Board  of  Governors  of  the  International  Fi- 
nance Corporation.  It  proposes  that  Article  III,  Section  2  of  the  Corporation's 
Articles,  the  sense  of  which  I  described  to  you  a  moment  ago,  would  be  deleted, 
and  a  new  section  2  would  be  substituted,  reading  simply:  "The  Corporation  may 
make  investments  of  its  funds  in  such  form  or  forms  as  it  may  deem  appropriate 
in  the  circumstances." 

In  order  to  safeguard  the  Corporation's  role  in  exercising  voting  rights  attached 
to  capital  stock  which  it  acquires,  Subsection  (iv)  of  Article  III,  Section  3,  which 
now  reads: 

"The  Corporation  shall  not  assume  responsibility  for  managing  any  enterprise 
in  which  it  has  invested" 
would  be  amended  by  adding: 

".  .  .  and  shall  not  exercise  voting  rights  for  such  purpose  or  for  any  other 
purpose  which,  in  its  opinion,  properly  is  within  the  scope  of  managerial  control." 

This  formulation,  in  my  judgment,  would  achieve  the  purpose  of  the  original 
prohibition  on  the  purchase  of  capital  stock.  Yet  it  would  also  permit  the  Cor- 
poration to  take  the  necessary  steps  to  protect  its  interests  in  the  event  it  is 
legally  required,  as  a  stockholder,  to  vote  on  such  matters  as  corporate  reorgan- 
ization, increase  of  capitalization,  etc. 

The  proposed  amendment  represents  a  desirable  and  logical  evolution  in  the 
development  of  the  Corporation.  The  National  Advisory  Council  on  Interna- 
tional Monetary  and  Financial  Problems  has  recommended  its  adoption.  It  is 
in  the  interest  of  the  United  States,  as  well  as  in  the  interest  of  the  free  world  as 
a  whole,  to  improve  the  ability  of  the  Corporation  to  carry  out  its  tasks  of  pro- 
moting productive  private  enterprise  in  the  developing  countries.  The  proposed 
amendment  is  essential  for  this  purpose. 

H.R.  6765  would  give  me  authority,  as  United  States  Governor  of  the  IFC,  to 
vote  in  favor  of  the  proposed  amendment  and  I  earnestly  recommend  its  ap- 
proval by  the  Congress. 

Exhibit  23. — Joint  announcement,  May  17,  1961,  by  Secretary  of  the  Treasury 
Dillon  and  the  Minister  of  Finance  of  Brazil  of  the  conclusion  of  financial 
negotiations  between  the  United  States  and  Brazil 

Secretary  of  the  Treasury  Douglas  Dillion  and  the  Minister  of  Finance  of 
Brazil  Clemente  Mariani  today  announced  the  conclusion  of  financial  negotiations 
between  the  United  States  and  Brazil. 


EXHIBITS  369 

In  his  message  to  the  Brazihan  Congress  in  March  President  Quadros  an- 
nounced a  new  economic  program  to  bring  economic  growth  and  progress  to  the 
Brazilian  people  under  conditions  of  financial  stability.  President  Kennedy,  in 
the  spirit  of  Operation  Pan  America  and  the  Alliance  for  Progress,  responded  by 
directing  the  appropriate  agencies  of  the  U.S.  Government  to  assist  the  Brazilian 
people  in  carrying  out  Brazil's  new  economic  program. 

President  Kennedy  pointed  out  that  the  future  of  Brazil — a  nation  containing 
half  the  population  of  South  America — was  vital  to  the  future  of  the  Western 
Hemisphere.  "By  identifying  ourselves  with  the  economic  and  social  aspirations 
of  the  people  of  Brazil,"  the  President  said,  "we  are  identified  with  the  hopes  of 
half  the  continent."  The  size  and  importance  of  Brazil  make  it  clear  that  the 
success  of  this  nation  in  realizing  its  potential  for  growth  and  progress  is  a  key 
to  the  maintenance  of  free  government  in  Latin  America. 

As  a  result  of  the  financial  negotiations  between  the  United  States  and  Brazil, 
the  United  States  has  agreed: 

1.  To  postpone  to  later  years  principal  repayments  to  the  Export-Import 
Bank,  amounting  to  $220  million,  which  would  otherwise  have  fallen  due  during 
the  rest  of  1961,  calendar  year  1962,  and  the  first  half  of  1963. 

2.  To  extend  the  obligation  to  repay  over  a  20-year  period  the  existing  debt 
to  Export-Import  Bank  of  approximately  $530  million  by  rescheduling  payments 
of  approximately  $305  miUion.  This  rescheduling  includes  the  postponement, 
referred  to  above,  of  principal  payments  otherwise  due  during  the  next  two  years 
in  the  amount  of  $220  million. 

3.  To  provide  new  credits  to  Brazil  totaling  $338  million.  Of  this  amount 
$168  million  will  be  provided  by  the  Export-Import  Bank,  $70  million  by  the 
Treasury  Exchange  Stabilization  Fund,  and  $100  million  from  President  Kennedy's 
new  foreign  assistance  program,  subject  to  action  by  the  Congress  on  the  proposed 
foreign  aid  program. 

Minister  Mariani  and  Secretary  Dillon  have  signed  the  Treasury  Exchange 
Stabilization  Agreement  and  the  President  of  the  Export-Import  Bank,  Harold  F. 
Linder,  has  issued  a  letter  of  commitment  on  behalf  of  the  Bank. 

While  in  Washington  Minister  Mariani  also  completed  discussions  with  the 
International  Monetary  Fund.  The  Fund  today  announced  that,  in  order  to 
assist  Brazil  in  carrying  out  its  new  economic  program,  the  Fund  has  agreed  to  re- 
schedule Brazil's  existing  debt  to  the  Fund  of  $140  million  and,  in  addition,  to 
extend  to  Brazil  a  standby  credit  of  $160  million. 

Conversations  were  also  held  by  Brazilian  representatives  with  private  U.S. 
banks  with  a  view  to  alleviating  the  burden  of  repayments  in  the  next  few  years, 
which  amount  to  $114  million,  as  well  as  to  obtaining  additional  credits.  These 
conversations  are  proceeding  satisfactorily  and  will  be  concluded  by  the  Director 
of  Exchange  of  the  Bank  of  Brazil  who  will  stay  in  the  United  States  for  this 
purpose. 

The  Brazilian  and  U.S.  Governments  have  also  undertaken  discussions  with 
European  countries  regarding  the  contribution  they  might  make  in  helping  Brazil 
to  overcome  its  financial  difficulties.  The  two  Governments  have  been  informed 
that  a  number  of  European  countries  have  agreed  in  principle  to  extend  to  Brazil 
a  substantial  standby  credit  and  to  reschedule  Brazil's  existing  debts  to  them  in 
order  to  lengthen  the  terms  of  repayment  and  reduce  substantially  payments  of 
principal  due  in  1961  and  1962. 

During  Minister  Mariani's  visit  to  Washington  he  and  Ambassador  Walther 
Moreira  SaUes,  who  has  conducted  the  preparatory  phase  of  the  negotiations,  were 
received  by  President  Kennedy.  The  President  expressed  his  great  hope  that 
assistance  provided  by  the  United  States,  the  International  Monetary  Fund,  and 
European  countries  would  help  to  assure  the  success  of  Brazil's  new  economic 
program. 

Exhibit  24. — Statement  by  Secretary  of  the  Treasury  Dillon,  June  5,  1961, 
before  the  Senate  Foreign  Relations  Committee  on  the  proposed  Act  for  In- 
ternational Development  and  the  International  Peace  and  Security  Act 

My  belief  that  foreign  aid  is  a  critically  essential  ingredient  of  our  national 
policy  is  well  known  to  this  committee.  As  Secretary  of  the  Treasury,  I  am,  of 
course,  intimately  concerned  with  the  formidable  problem  of  financing  all  of  our 
most  urgent  national  needs,  both  foreign  and  domestic.     If  we  are  to  meet  these 


370    19  61  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

needs  without  sacrificing  our  fiscal  integrity,  we  must  set  priorities.  And  I  am 
firmly  convinced  that  an  adequate,  flexible,  and  soundly  conceived  program  of 
foreign  economic  assistance  merits  very  high  priority.  Such  a  program  is  basic 
to  the  security  and  well-being  of  our  Nation.  I  agree  with  the  views  expressed 
by  Secretary  of  State  Rusk  last  Wednesday  describing  the  urgency  and  importance 
of  President  Kennedy's  new  program,  and  I  am  pleased  to  appear  before  you  in 
support  of  S.  1983. 

I  would  like  to  confine  my  remarks  today  to  the  financial  aspects  of  the  proposed 
legislation — aspects  for  which  I,  as  Secretary  of  the  Treasury  and  Chairman  of  the 
National  Advisory  Council  on  International  Monetary  and  Financial  Problems, 
have  a  special  responsibility.  At  my  request  the  National  Advisory  Council  has 
reviewed  and  approved  those  aspects  of  the  proposed  Act  for  International  De- 
velopment which  relate  to  international  financial  policy. 

The  program  the  President  has  submitted  to  Congress  is  one  that  the  United 
States  can  afford.  Including  the  essential  increases  requested  by  President 
Kennedy  in  his  special  message  on  urgent  national  needs,  a  total  of  $2,878  million 
is  being  requested  in  fiscal  1962  for  the  Act  for  International  Development.  This 
amount  includes  authorization  to  reuse  some  $287  million  which  is  what  we  cur- 
rently expect  to  receive  from  dollar  repayments  of  previous  foreign  loans.  It 
also  includes  authority  to  borrow  $900  million  from  the  Treasury  for  development 
loans.  In  addition,  the  military  assistance  request  for  1962  amounts  to  $1,885 
million.  This  makes  up  an  overall  total  program  of  $4,763  million  which  amounts 
to  less  than  one  percent  of  our  gross  national  product,  a  figure  that  is  certainly 
well  within  the  capacity  of  our  domestic  economy. 

The  proposed  bill  also  requests  authority  to  borrow  from  the  Treasury  $1.6 
billion  for  each  of  the  following  four  years  as  well  as  continued  authority  to  reuse 
the  dollars  from  repayments  on  earlier  foreign  loans.  These  repayments  are 
expected  to  average  about  $300  million  annually  during  these  four  years. 

The  expenditure  estimates  for  fiscal  year  1962  under  the  proposed  program 
are  approximately  the  same  as  those  contained  in  the  budget  presented  to  the 
Congress  by  President  Eisenhower.  The  increased  expenditures  to  be  expected 
over  the  years  following  1962  will,  of  course,  be  taken  into  account  in  the  presen- 
tation of  the  budgets  for  those  years. 

As  Secretary  of  the  Treasury  I  am  especially  interested  in  the  relationship  of 
foreign  assistance  to  our  balance  of  payments.  The  program  proposed  is  consist- 
ent with  our  efforts  to  achieve  and  sustain  overall  balance  in  our  international 
payments.  I  wish  to  emphasize  that  it  is  the  form  in  which  aid  is  extended, 
rather  than  the  amount  to  be  provided,  which  is  most  relevant  to  this  ciuestion. 
We  will  continue  under  the  new  program  to  place  primary  emphasis  on  the  pur- 
chase of  U.S.  goods  and  services  by  aid  recipients.  The  preponderant  part  of 
foreign  aid  expenditures  will  be  spent  in  the  United  States.  Such  expenditures, 
which  are  accompanied  by  American  exports,  have  no  adverse  impact  on  our 
balance  of  payments.  In  1960,  American  exports  financed  by  aid  programs 
accounted  for  nearly  half  of  our  total  export  surplus.  The  fact  that  foreign 
assistance  is  in  any  case  largely  accompanied  by  an  outflow  of  American  exports 
is  not  understood  by  those  who  hope  to  cure  our  payments  deficit  by  curtailing 
foreign  economic  assistance.  Nevertheless,  for  such  time  as  our  payments 
situation  requires,  our  objective  will  be  to  assure  that  at  least  eighty  percent  of 
our  foreign  economic  assistance  will  be  spent  on  U.S.  goods  and  services.  Because 
of  earlier  commitments  this  goal  cannot  be  achieved  immediately  but  the  new 
policy  will  liave  an  increasingly  favorable  effect  on  our  payments  position. 

Under  the  present  policy  it  is  not  in  every  case  practicable  or  desirable  to 
require  that  foreign  assistance  funds  be  limited  exclusively  to  the  procurement 
of  U.S.  goods  and  services.  In  some  cases  particular  commodities  financed  by 
aid  dollars  are  not  available  in  the  United  States,  or  may  not  be  available  here 
in  the  time  required.  Also,  emergency  situations  sometimes  require  the  transfer 
of  aid  through  cash  grants,  a  part  of  which  is  ultimately  spent  for  the  goods  of 
other  countries.  Nevertheless,  through  our  procurement  policy  we  will  keep 
to  a  minimum  any  adverse  effect  of  aid  spending  on  our  payments  situation.  I 
am  satisfied  that  "the  present  directives  are  adequate  to  assure  this  result. 

TJie  new  economic  aid  program  set  forth  in  the  proposed  Act  for  International 
Development  emphasizes  long-term  authority  for  financing  development  lending. 
The  President,  in  his  letter  transmitting  the  draft  foreign  assistance  bill,  stated 
that  "Real  progress  in  economic  development  cannot  be  achieved  by  annual, 
short-term  dispensations  of  aid  and  uncertainty  as  to  future  intentions." 


EXHIBITS  371 

I  am  convinced  from  my  earlier  experience  in  the  Department  of  State  that 
long-term  financing  authority  is  an  essential  tool  for  the  achievement  of  our 
foreign  policy  objectives.  I  am  equally  convinced  as  Secretary  of  the  Treasury 
that  this  is  the  most  efficient  and  least  costly  method  of  providing  development 
assistance. 

Adequate  authority  for  long-term  financing  as  proposed  in  the  bill  will  permit 
both  orderly  development  and  effective  execution  of  development  lending  pro- 
grams by  the  administrator  of  the  aid  program.  Without  such  authority  there 
will  continue  to  be  insistent  pressures  for  stopgap  financing  to  meet  crises  which 
could  have  been  prevented,  at  less  cost,  by  adequate  long-range  programs. 

In  my  judgment  the  inability  of  the  Executive  to  make  long-term  commit- 
ments has  diminished  the  effectiveness  and  increased  the  cost  of  the  foreign  aid 
program.  Without  adequate  assurance  of  financing  for  long-term  programs  to 
deal  with  the  basic  needs  of  a  developing  country,  there  is  less  incentive  for  such 
a  country  to  thoroughly  organize  its  plans  or  to  adopt  appropriate  measures 
of  self-help.  We  urge  the  developing  countries  to  undertake  basic  and  difficult 
reforms  that  are  essential  to  development.  But  such  reforms  take  years  to  imple- 
ment, and  require  the  support  of  long-term  development  programs.  Reasonable 
assurance  of  outside  assistance  extending  over  a  period  of  years  may  often  mean 
the  difference  between  success  or  failure  in  the  efforts  of  a  developing  country 
to  carry  out  the  measures  requisite  to  effective  development.  Legislative  author- 
ity to  make  multiyear  commitments  will  for  the  first  time  put  the  United  States 
in  a  position  to  effectively  stimulate  and  cooperate  in  basic  reforms.  It  will 
also  provide  an  iiicentive  to  other  industrialized  countries  to  join  with  the  United 
States  in  providing  aid  to  developing  areas. 

Because  an  effective  long-term  foreign  lending  program  requires  an  assured 
and  adequate  source  of  funds  for  solid  multiyear  commitments,  the  President 
has  requested  that  development  loans  be  financed  by  borrowing  from  the  Treasury. 
For  this  purpose  the  proposed  bill  provides  for  authority  to  borrow  from  the 
Treasury  $900  million  in  fiscal  year  1962  and  $1.6  billion  in  each  of  the  succeeding 
four  years.  This  method  would  be  used  only  for  development  loans  and  specific 
ceilings  would  be  established  limiting  the  amount  of  borrowing  authority  to  be 
exercised  annually.  All  loan  transactions  making  use  of  this  authority  would 
be  in  dollars  and  all  repayments  would  be  in  dollars.  Grants  or  other  iforms  of 
assistance  connected  with  the  foreign  aid  program  would  continue  to  be  financed 
by  annual  appropriations. 

It  is  a  common  practice  to  finance  lending  operations  of  U.S.  agencies  through 
loans  and  advances  from  the  Treasury.  The  Treasury  uses  this  method  to  finance 
the  programs  of  more  than  twenty  agencies,  in  accordance  with  the  statutes 
governing  the  activities  of  the  particular  agency.  A  list  of  examples  of  legislative 
authorizations  currently  in  effect  for  financing  governmental  activities  through 
the  borrowing  method  has  been  submitted  for  the  information  of  the  committee. 

This  fiscal  arrangement  need  not,  and  will  not,  mean  any  loss  of  legislative 
control  over  expenditures.  The  funds  will  be  available  only  for  the  purposes 
and  in  the  annual  amounts  approved  by  the  Congress.  Under  the  proposed  legis- 
lation, specific  congressional  control  over  the  lending  program  would  be  exercised 
in  each  year  of  the  five-year  period  in  a  number  of  ways: 

First,  the  law  would  determine  the  availability  of  the  funds  year-by-year. 

Second,  quarterly  reports  on  lending  operations  would  be  submitted  to  the 
Congress. 

Third,  an  annual  presentation  would  be  made  to  the  authorizing  committees  of 
the  Congress  covering  all  development  lending  operations. 

Fourth,  an  annual  presentation  would  be  made  to  the  appropriations  commit- 
tees of  the  Congress  in  accordance  with  the  provisions  of  the  Government  Corpora- 
tions Control  Act.  Under  this  act  the  aid  agency  would  be  required  to  submit 
to  the  appropriations  committees  an  annual  budget  setting  forth  its  proposed 
lending  operations  for  the  coming  year  and  to  obtain  from  Congress  authority  to 
expend  funds  in  accordance  with  this  budget. 

Finally,  the  amounts  to  be  borrowed  under  the  proposed  legislation  would  be 
included  each  year  in  the  budget  as  new  obligational  authority  in  the  same  manner 
as  other  appropriations.  Similarly,  expenditures  would  appear  in  the  regular 
expenditures  budget.  As  far  as  the  budget  is  concerned  there  is  not  the  slightest 
difference  between  this  method  of  funding  and  the  appropriation  process  heretofore 
used  for  this  program. 

I  would  like  to  make  a  further  point  in  connection  with  the  use  of  borrowing 
authority.     This  is  that  borrowing  from  the  Treasury  under  the  Act  for  Inter- 


372   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

national  Development  would  not  mean  that  the  Treasury  would  be  forced  into 
any  additional  borrowing  from  the  public.  To  put  it  another  way,  the  extent  to 
which  the  Treasury  may  have  to  increase  the  public  debt,  or  alternatively  rely 
upon  tax  or  other  income  is  exactly  the  same  whether  foreign  development  lending 
is  financed  by  the  borrowing  method  or  by  funds  otherwise  appropriated.  The 
requirements  of  this  and  all  other  programs,  foreign  and  domestic,  determine  the 
amount  of  overall  expenditure  which  must  be  met  by  the  receipts  of  the  Treasury. 

The  financing  of  development  loans  by  borrowing  authority  was  recommended 
by  President  Eisenhower  in  1957  at  the  inception  of  the  Development  Loan  Fund 
and  approved  at  that  time  by  this  committee  and  the  Senate.  As  you  know, 
the  Development  Loan  Fund  is  authorized  to  make  loans  repayable  in  local 
currency,  that  is,  repayable  in  the  currency  of  the  borrower  rather  than  in  dollars. 
As  a  result  of  experience,  it  has  been  found  desirable  to  change  this  policy.  It 
is  now  proposed  that  all  development  loans  under  the  new  program  be  repaid 
exclusively  in  dollars. 

An  important  reason  for  this  change  is  that  the  United  States  is  rapidly  ac- 
quiring large  accruals  of  local  currencies  from  various  programs,  most  importantly 
from  the  sale  of  agricultural  surpluses  under  Public  Law  480.  There  is  danger 
that  continued  large  accruals  of  local  currency  by  the  U.S.  Government  could 
become  a  source  of  friction  and  misunderstanding  in  our  future  relations  with 
the  countries  whose  currencies  we  are  accumulating.  This  danger  would  be 
particularly  acute  if  the  U.S.  Government  were  to  acquire  a  large  proportion  of 
the  outstanding  money  supply  in  a  foreign  country.  The  accumulation  of  large, 
and  in  many  cases  excessive  or  unusable  amounts  of  local  currency,  provides  no 
advantage  to  the  United  States  whereas  repayment  in  dollars,  even  over  a  long 
period  of  time,  would  provide  a  definite  return. 

The  President  has  also  requested  authority  to  make  available  for  development 
lending  the  dollars  to  be  realized  from  repayments  of  earlier  foreign  obligations. 
This  request  is  confined  to  outstanding  obligations  in  which  the  United  States 
has  the  option  to  require  dollar  repayments.  The  amounts  will  approximate 
$300  million  a  year  for  the  next  five  years.  This  is  a  reasonable  extension  of  the 
revolving  fund  principle  that  has  been  used  in  many  other  lending  programs. 
It  would,  in  brief,  put  the  returns  from  our  earlier  aid  programs  to  the  indus- 
trialized countries  to  work  in  our  new  program  to  help  the  developing  countries. 

The  primary  purpose  of  the  development  lending  provisions  of  the  Act  for 
International  Development  is  to  assist  the  developing  countries  in  carrying  out 
long-range  development  programs.  Loan  funds  are  intended  to  support  those 
activities  which  make  the  most  effective  contribution  to  economic  growth.  Loans 
may,  for  example,  be  directed  to  specific  projects.  They  may  also  be  used  to 
provide  broad  support  for  a  national  development  program.  They  may  also  be 
used  to  help  in  establishing  general  financial  and  economic  conditions  essential  to 
steady  growth  in  the  future.  All  three  kinds  of  lending  operations  are  essential 
if  the  needs  of  the  developing  countries  are  to  be  met. 

During  the  past  few  years  the  United  States  has  come  to  recognize  the  need 
of  the  developing  countries  for  loans  on  terms  more  favorable  to  the  borrower 
than  can  be  provided  under  conventional  banking  practices.  Under  the  proposed 
legislation  this  need  will  continue  to  be  met,  even  though  dollar  repayment  is  to 
be  required.  Dollar  repayment  should  be  possible  as  the  developing  country 
increases  its  ability  to  mobilize  domestic  resources  and  to  enlarge  its  exports  and 
foreign  exchange  earnings.  But  these  self-help  efforts  of  the  developing  countries 
will  take  time  to  bear  fruit.  Meanwhile,  it  is  necessary  to  avoid  excessive  debt 
burdens  on  the  budget  or  the  balance  of  payments  of  the  developing  country. 
Repayment  over  a  long  term  with  substantial  grace  periods  would  allow  the  major 
burden  of  repayment  to  come  after  self-sustaining  growth  has  commenced. 
Elimination  or  drastic  reduction  of  the  interest  burden  on  loans  should  also 
considerably  ease  the  annual  and  overall  debt  service  burden  of  the  loan. 

It  is  for  these  reasons  that  development  loans  under  the  proposed  program 
are  intended  to  be  on  terms  much  less  onerous  than  conventional  banking  terms. 
Periods  of  repayment  may  extend  up  to  fifty  years.  Grace  periods,  in  which  no 
repayment  of  principal  is  required,  may  be  granted  up  to  ten  years.  Rates  of 
interest  could  be  low  or  nonexistent,  although  a  small  service  charge  might  be 
made.  In  short,  loan  terms  would  take  into  account  the  prospective  situation  of 
the  borrower.    Flexibility  would  perniit  loans  to  private  borrowers  on  appropriate 


EXHIBITS  373 

terms.  Thus,  while  the  objective  of  lending  operations  will  be  to  improve  the 
ability  of  the  borrowing  country  to  service  its  debts  through  progress  in  develop- 
ment, the  burden  of  debt  service  will  not  be  such  as  to  impede  that  progress. 
These  terms  and  conditions  which  are  along  the  lines  being  worked  out  by  the 
International  Development  Association  should  enable  the  United  States  to  offer 
to  the  developing  countries  loan  terms  as  favorable  as  those  offered  by  any  other 
country  in  the  world.  It  is  significant  that  the  International  Development 
Association  reached  this  decision  after  long  and  thorough  international  discussion 
under  the  leadership  of  its  distinguished  President,  Mr.  Eugene  Black. 

The  development  lending  operations  of  the  new  aid  agency  will  necessarily  be 
related  to  the  activities  of  other  lending  institutions — national  and  international. 
As  the  U.S.  Governor  of  the  major  international  financial  institutions,  I  have 
responsibility  for  assuring  that  the  national  lending  activities  of  the  United  States 
are  properly  coordinated  with  the  activities  of  the  International  Bank  for  Recon- 
struction and  Development,  the  International  Development  Association,  the 
International  Finance  Corporation,  and  the  Inter-American  Development  Bank. 
Coordination  with  the  international  institutions  and  with  the  Export-Import 
Bank  will  also  be  effected  through  the  National  Advisory  Council,  through  the 
United  States  Executive  Directors  of  the  international  institutions,  and  through 
informal  day-to-day  contacts.  In  addition  the  proposed  legislation  provides  for 
a  Development  Loan  Committee,  similar  to  the  present  Development  Loan  Fund 
Board,  to  establish  standards  and  criteria  for  the  lending  operations  of  the  new 
aid  agency  in  accordance  with  the  foreign  and  financial  policies  of  the  United 
States.  The  Treasury  Department  and  the  Export-Import  Bank  will  be  repre- 
sented on  this  interagency  committee. 

Through  proper  coordination  we  can  ensure  that  the  new  lending  program  will 
complement,  rather  than  compete  with,  other  established  lending  institutions, 
domestic  or  international  as  well  as  the  flow  of  private  funds  available  for  inter- 
national investment. 

We  will  also  continue  to  work  with  the  other  industrialized  nations  of  the  free 
world  to  encourage  increased  participation  by  them  in  providing  economic  assist- 
ance to  the  developing  countries.  This  is  the  major  objective  of  the  Development 
Assistance  Group  which  will  soon  be  incorporated  in  the  new  Organization  for 
Economic  Cooperation  and  Development.  The  functions  of  the  Development 
Assistance  Group  and  the  Organization  for  Economic  Cooperation  and  Develop- 
ment in  this  field  will  be  discussed  in  detail  by  Under  Secretary  Ball. 

In  addition  to  the  work  of  the  Development  Assistance  Group  in  urging  the 
mobilization  of  resources  of  the  industrialized  countries  for  the  purpose  of  help- 
ing the  developing  countries,  there  has  been  very  substantial  progress  in  coordi- 
nating and  enlarging  free  world  assistance  to  particular  countries.  The  Inter- 
national Bank  for  Reconstruction  and  Development  has  pioneered  in  this  effort 
by  enlisting  the  cooperation  of  a  number  of  industrialized  countries  in  expanding 
help  to  India  and  Pakistan.  You  are  familiar  with  the  Bank's  role  in  the  Indus 
Waters  project  and  the  financial  participation  by  a  number  of  its  members  in 
this  important  undertaking.  The  Bank  has  also  played  an  important  role  in 
stimulating  and  coordinating  efforts  by  the  economically  advanced  countries  to 
assist  India's  economic  development  by  convening  consortium  meetings  on  several 
occasions  in  the  past.  Only  last  week  it  led  a  meeting  of  capital-exporting  coun- 
tries prepared  to  help  in  financing  India's  third  Five- Year  Plan. 

Participating  countries  other  than  the  United  States  indicated  their  willingness 
to  provide  $780  million  over  the  next  two  years.  This  amount,  together  with 
$400  million  from  the  World  Bank  and  the  International  Development  Associa- 
tion, and  $1  billion  from  the  United  States,  which  is  subject  to  congressional 
action  on  the  pending  legislation,  should  enable  India  to  proceed  in  an  orderly 
manner  to  a  successful  launching  of  its  Third  Plan.  A  similar  meeting  under 
the  auspices  of  the  World  Bank  is  being  held  this  week  to  consider  aid  to  Pakistan. 

If  the  United  States  and  the  other  industrialized  countries  of  the  free  world 
fully  cooperate  in  providing  assistance  to  the  developing  areas,  based  upon  the 
self-help  efforts  of  the  developing  countries  themselves,  we  can  look  forward  to 
a  decade  of  progress  and  development  for  the  hundreds  of  millions  of  people  in 
other  lands  economically  less  fortunate  than  our  own.  Their  economic  progress 
is  to  no  small  degree  dependent  on  us.  Our  own  future  importantly  depends  on 
them.     The  bill  before  you  is  essential  to  meet  the  need. 


374   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Exhibit  25. — Statement  by  Secretary  of  the  Treasury  Dillon,  June  19,  1961, 
before  the  Subcommittee  on  International  Exchange  and  Payments  of  the 
Joint  Economic  Committee 

I  appreciate  this  opportunity  to  appear  before  you  this  morning  to  discuss 
recent  developments  in  tlie  international  payments  structure.  Tlie  committee's 
review  of  these  developments  and  its  study  of  possible  ways  to  improve  present 
international  monetary  mechanisms  is  both  timely  and  welcome. 

The  problems  stemming  from  persistent  imbalances  in  the  international  econ- 
omy are  of  course  not  new,  they  have  been  with  us  in  one  form  or  another  through- 
out much  of  the  postwar  period.  While  the  so-called  "dollar  shortage"  of  earlier 
years  was  recognized  as  a  source  of  international  instability,  and  policies  were 
adopted  by  the  United  States  specifically  to  deal  with  this  problem,  its  effects 
were  felt  more  directly  by  the  rest  of  the  world  than  they  were  by  us.  What 
is  new  is  that  the  constraints  imposed  by  our  own  recent  balance-of-payments 
deficits — most  conspicuously  evidenced  in  the  decline  of  the  U.S.  gold  stock — 
liave  become  a  matter  of  direct  public  concern  in  this  country. 

Problems  in  the  world's  financial  markets  cannot  be  divorced  from  the  under- 
lying economic  conditions  and  trade  patterns  of  the  world's  major  countries. 
Therefore,  although  the  committee  has  indicated  its  desire  to  focus  on  the  financial 
side  of  the  international  payments  structure  during  the  current  hearings,  I  should 
like  to  begin  by  highlighting  recent  developments  in  this  country's  balance  of 
payments  with  the  rest  of  the  world,  relating  these  developments  to  the  pressures 
that  have  arisen  in  the  exchange  markets.  Against  this  background,  I  should 
then  like  to  comment  on  the  exchange  market  pressures  themselves  and  some  of 
the  specific  steps  that  have  been  taken  to  deal  with  them. 

The  U.S.  balance  of  payments,  1960-61 

The  problems  which  gave  rise  to  the  rajjid  gold  outflow  during  the  second  half 
of  1960  had  their  roots  in  the  unprecedentedly  large  balance-of-payments  deficits 
incurred  by  the  United  States  in  both  1958  and  1959.  In  analyzing  these  deficits, 
we  need  to  distinguish  between  what  may  be  called  the  "basic"  components  of 
our  payments  accounts,  and  the  short-term  capital  flows  which,  as  we  have  seen, 
can  have  such  an  important  impact  on  our  overall  position  at  any  given  time.  It 
was  partly  to  point  up  this  distinction  that  I  made  arrangements  several  months 
ago  to  set  up  a  special  interdejoartmental  Committee  on  Balance-of-Payments 
Information  to  study  possible  ways  of  rearranging  our  international  accounts  to 
make  them  analytically  more  useful.  I  thought  that  your  committee  might  be 
interested  in  one  form  of  presentation  that  we  have  adapted  for  our  use  in  the 
Treasury,  on  the  basis  of  the  interdepartmental  committee's  work  thus  far. 

If  you  will  look  at  line  15  of  table  I,  you  will  see  that  our  basic  deficit  was  very 
large  in  1958  and  increased  still  further  in  1959.  Last  year,  however,  there  was 
substantial  improvement  in  the  l^asic  balance  as  exports  picked  up  sharply  and 
imports  actually  declined  somewhat.  In  the  first  quarter  of  this  year,  moreover, 
exports  remained  at  high  levels  while  imports  continued  to  fall  slightly,  with  the 
result  that  we  actually  achieved  a  small  surplus  on  these  basic  items. 

While  there  are  some  indications  that  the  recent  improvement  in  our  merchan- 
dise accounts  reflects  a  strengthened  U.S.  competitive  position — for  example,  in 
the  displacement  of  foreign  automobile  imports  by  domestically  produced  compact 
models — we  cannot  overlook  the  fact  that  much  of  the  change  was  due  to  the  con- 
junction of  high  levels  of  economic  activity  in  other  advanced  countries  with  a 
recession  in  the  United  States.  Therefore,  since  the  progress  of  recovery  in  tlie 
United  States  will  undoubtedly  bring  some  increase  in  our  imports,  we  must  expect 
somewhat  less  favorable  results  during  the  second  half  of  the  year.  Furthermore, 
even  if  we  should  achieve  a  basic  balance  this  year,  there  is  no  assurance  that  this 
balance  can  be  maintained  in  1962.  Certainly  we  cannot  afl"ord  to  depend  on  the 
recent  combination  of  circumstances — boom  conditions  in  Europe  and  Japan 
side  by  side  with  recession  in  the  United  States — ^which  make  for  the  widest  possi- 
ble trade  surplus.  It  is  essential,  therefore,  that  we  push  forward  with  the  Presi- 
dent's balance-of-payments  program  in  order  to  assure  our  ability  to  maintain 
balance  in  our  international  accounts  over  the  longer  run. 

We  must  of  covu'se  be  concerned  not  onlj'^  witli  policies  that  will  strengthen  our 
basic  balance,  but  also  with  the  development  of  measures  to  cope  with  interna- 
tional short-term  capital  flows.  While  we  must  expect  some  transfers  of  funds 
between  countries  in  response  to  differing  commercial  incentives,  there  is  no 
economic  justification  for — and  potentially  much  harm  from — movements  that 


EXHIBITS  375 

begin  to  feed  on  themselves  for  speculative  reasons.  As  you  know,  the  consider- 
able improvement  in  our  basic  balance  during  1960  was  offset  almost  completely 
by  outflows  of  short-term  funds.  Line  16  of  the  first  table  shows  the  rise  of  more 
than  a  billion  dollars  in  this  outflow  last  year.  An  additional  strain  was  placed 
on  our  overall  balance  by  the  shift  in  unrecorded  transactions  (line  17)  from  a  sub- 
stantial inflow  in  1959  to  an  outflow  of  more  than  half  a  billion  dollars  in  1960. 
These  unrecorded  transactions  represent  largely  private  transactions  and  much  of 
last  year's  shift  is  clearly  associated  with  the  speculative  atmosphere  that  devel- 
oped last  fall. 

While  short-term  capital  movements  are  more  difficult  to  analyze  than  changes 
in  the  basic  components  of  our  international  accounts,  it  seems  likely  that  much 
of  the  outflow,  initially  at  least,  was  attributable  to  widening  differentials  in  in- 
terest rates  and  credit  availabilities  between  this  country  and  other  financial 
centers.  Not  only  was  there  a  substantial  incentive  to  transfer  funds  to  foreign 
money  market  instruments  such  as  Treasury  bills  and  bankers'  acceptances,  but 
the  differential  in  bank  lending  rates  also  caused  business  borrowers  to  shift  their 
source  of  financing  from  other  countries  to  U.S.  banks.  At  the  same  time  the 
unfavorable  short-run  prospects  for  capital  appreciation  in  this  country  caused 
foreigners  to  contract  their  investments  in  the  stock  market,  and  enhanced  the 
attractiveness  to  U.S.  firms  of  direct  investments  abroad. 

As  the  summer  months  progressed,  and  the  earlier  improvement  in  the  trade 
balance  was  increasingly  offset  by  these  capital  outflows,  rumors  began  to  appear 
in  the  exchange  markets  that  even  the  dollar  itself  could  not  withstand  continued 
deficits  of  the  magnitude  that  had  been  experienced  in  the  three  preceding  years. 
As  a  result  there  was  some  liquidation  of  dollar  holdings  to  avoid  any  risk  from 
devaluation,  with  the  result  that  speculative  withdrawals  of  funds  were  added  to 
the  outflows  already  taking  place  in  response  to  business  incentives. 

The  wide  differentials  in  money  market  rates  which  helped  to  activate  the 
sizable  movements  of  short-term  "funds  in  1960  have,  for  the  most  part,  been 
considerably  narrowed  this  year.  Even  more  important,  the  President's  un- 
equivocal statements  of  our  determination  to  maintain  the  present  gold  value  of 
the  dollar,  together  with  his  program  for  dealing  with  balance-of-payments 
deficits,  have  fully  restored  confidence  in  the  dollar,  and  thus  eliminated  a  source 
of  heavy  pressure  on  our  reserves.  This  changed  atmosphere  was  reflected  in 
the  sharp  swing  in  "unrecorded  transactions"  from  a  large  negative  figure  in  the 
latter  part  of  last  j'ear  to  a  small  plus  figure  during  the  first  quarter.  On  the 
other  hand,  foreign  business  firms,  particularly  in  Japan  and  Germany,  continued 
to  borrow  heavily  from  U.S.  banks  with  the  result  that  recorded  outflows  of  short- 
term  capital  continued  at  roughly  the  same  rate  as  the  second  half  of  last  year 
during  the  first  three  months  of  1961,  that  is,  close  to  $2  billion  a  j^ear  on  a  sea- 
sonally adjusted  basis.  Therefore,  even  though  there  has  been  a  significant 
improvement  from  the  latter  part  of  1960,  we  must  still  keep  an  eye  on  short- 
term  rates  in  this  country  so  as  not  to  encourage  a  resumption  of  sizable  money 
market  investments  a])road. 

Before  going  on  to  discuss  some  of  the  steps  that  have  been  taken  to  deal  both 
with  the  basic  balance-of-payments  problem  and  the  unsettling  effects  of  short- 
term  capital  movements,  I  think  it  would  be  useful  to  summarize  the  geographical 
distribution  of  gold  and  dollar  gains  during  the  past  three  years.  In  a  very  rough 
way  these  gains  reflect,  and  indeed  are  the  counterpart  of,  U.S.  deficits.  Table 
II  emphasizes  the  well-known  fact  that  by  far  the  largest  part  of  excess  U.S. 
expenditures  abroad  has  ended  up,  directly  or  indirectlj',  in  the  gold  and  dollar 
holdings  of  continental  Western  European  countries.  Japan,  too,  has  accumu- 
lated sizable  balances  during  this  period,  though  the  increase  in  official  reserves 
seems  to  have  come  to  a  halt  recently.  The  large  increase  in  the  gold  and  dollar 
holdings  of  the  sterling  area  during  1960  was  more  than  accounted  for  by  short- 
term  capital  inflows  into  the  United  Kingdom,  and  there  has  been  some  reverse 
flow  in  the  last  few  months. 

The  point  I  wish  to  emphasize  is  that  international  imbalances  are  two-sided. 
The  obligation  to  take  effective  action  to  bring  about  equilibrium  in  international 
accounts  falls  as  heavily  on  surplus  countries  as  it  does  on  those  incurring  a  deficit. 
The  United  States  recognized  this  obligation  and  acted  decisively  during  the 
earlier  postwar  period  to  alleviate  the  dollar  shortage.  Now  that  circumstances 
have  changed,  others  must  follow  this  example. 

At  the  same  time  we  ourselves  have  embarked  on  a  broad  program  aimed  at 
achieving  a  sustainable  balance  in  our  international  payments  within  the  next 


376    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

two  years.  The  general  outline  of  the  proposed  measures  was  described  in  the 
President's  message  to  Congress  of  February  6,  and  I  do  not  believe  it  is  necessary 
to  reexamine  the  whole  program  in  detail  at  this  time.  I  would,  however,  like  to 
offer  a  few  general  observations. 

First  of  all,  these  measures  have  been  designed  to  avoid  damage  to  our  national 
security  and  to  be  consistent  with  our  international  obligations.  For  this  reason 
we  have  not  proposed  curtailment  of  our  overall  military  or  economic  assistance 
programs.  We  have,  however,  carefully  reviewed  these  programs  and  taken 
action  to  reduce  their  foreign  exchange  costs  as  much  as  possible.  Both  our  mili- 
tary and  our  economic  assistance  programs  are  now  being  administered  so  as  to 
place  primary  emphasis  on  procurement  of  U.S.  goods  and  services.  In  fact,  we 
estimate  that  more  than  two  billion  dollars  of  U.S.  Government  economic  grants 
and  credits  were  spent  internally  even  in  1960. 

The  administration's  balance-of-payments  measures  were  also  designed  to  con- 
form to  this  country's  liberal  commercial  policy.  We  have  ruled  out  the  imposition 
of  either  trade  or  foreign  exchange  controls  because  such  controls  would,  of  course, 
be  self-defeating — -particularly  for  a  country  of  our  relative  importance  in  inter- 
national transactions.  We  have  advocated  the  removal  of  special  tax  incentives 
to  direct  investment  in  developed  countries  overseas.  It  would  clearly  be  to  our 
own  long-run  disadvantage,  as  well  as  contrary  to  our  principles,  to  impose  general 
restraints  on  foreign  investment.  Similarly  in  the  area  of  trade,  our  efforts  have 
been  aimed  at  inducing  other  countries  and  trading  groups  to  eliminate  discrimi- 
natory quotas  and  reduce  tariffs  on  dollar  exports  rather  than  imposing  restrictions 
ourselves. 

While  the  United  States  will  continue  to  seek  a  solution  to  its  balance-of- 
payments  problem  along  lines  that  are  consistent  with  its  international  obligations 
and  policies,  I  cannot  emphasize  too  strongly  that  the  task  will  be  exceedingly 
difficult  without  the  fullest  cooperation  of  the  surplus  coimtries.  A  continued 
accumulation  of  reserves,  year  after  year,  cannot  avoid  straining  the  international 
financial  system.  Industrialized  countries  must  work  together  closely  to  eliminate 
the  basic  imbalances  that  have  developed  during  the  past  few  years. 

At  the  same  time  it  is  also  important  that  we  continue  our  efforts  to  strengthen 
the  international  financial  framework  itself  so  that  the  danger  from  speculative 
capital  movements — generated  by  these  imbalances — may  be  minimized.  I 
should  like  to  turn  now  to  some  of  the  steps  that  have  already  been  taken,  both 
unilaterally  and  in  cooperation  with  authorities  abroad,  to  this  end. 

Strengthening  the  international  financial  system 

The  problems  that  arose  from  the  outflow  of  short-term  funds  during  the 
second  half  of  1960,  not  only  for  the  United  States  but  also  for  the  recipients  of 
these  funds,  grew  out  of  the  conditions  that  have  developed  since  the  return  to 
convertibility  by  most  of  the  world's  important  currencies  at  the  end  of  1958. 
It  quickly  became  clear  that  these  new  problems  required  new  measures  to  deal 
with  them. 

One  of  the  most  widely  discussed  experiments  undertaken  in  this  country  in- 
volved the  attempt  to  influence  the  structure  of  domestic  interest  rates  through 
new  techniques  in  the  implementation  of  monetary  and  debt  management  policies. 
For  several  months  now  the  authorities  have  sought  to  achieve  the  seemingly 
contradictory  goals  of  holding  up  short-term  rates  while  enlarging  the  flow  of 
funds  into  all  forms  of  domestic  investment  in  order  to  spur  domestic  recovery. 
On  the  whole  this  venture  has  been  gratifyingly  successful  thus  far,  both  in  limit- 
ing the  interest  incentive  to  transfer  short-term  funds  abroad  and  in  maintaining 
credit  ease  and  encouraging  monetary  expansion  at  home. 

In  part  this  has  been  made  possible  by  the  cooperation  of  other  countries  in 
an  effort  to  reduce  the  volatility  of  short-term  flows.  This  was  most  clearly  seen 
in  the  measures  taken  by  various  European  monetary  authorities  to  reduce  the 
attractiveness  of  their  money  market  instruments  to  foreigners.  In  both  Ger- 
many and  Switzerland,  for  example,  the  authorities  took  administrative  action 
to  discourage  foreign  investments  in  their  respective  money  markets  by  barring 
the  payment  of  interest  on  such  investments,  and  in  certain  cases  even  imposing 
a  penalty  on  foreign  balances.  Similarly  in  Germany,  short-term  interest  rates 
were  reduced  specifically  with  a  view  to  the  foreign  effect.  As  a  result,  the  dif- 
ferential between  short-term  rates  here  and  abroad,  particularly  after  allowing 
for  forward  exchange  cover,  has  narrowed,  and  thus  reduced  considerably  the 
interest  advantage  of  shifting  funds  abroad. 


EXHIBITS  377 

Although  these  measures  were  most  helpful  in  alleviating  the  immediate  prob- 
lem posed  by  interest  differentials,  it  was  generally  agreed  that  there  was  a  need 
for  continuing  contact  and  discussion  of  international  financial  problems  in  order 
that  steps  might  be  taken  before  a  potentially  unstable  situation  got  out  of  hand. 
The  Federal  Reserve,  both  on  its  own  behalf  and  as  fiscal  agent  of  the  Treasury, 
has  been  keeping  in  closer  touch  with  monetary  authorities  in  Europe.  At  the 
same  time,  the  U.S.  Government  has  taken  the  initiative  in  developing  a  frame- 
work for  close  consultation  with  European  authorities  through  the  Organization 
for  European  Economic  Cooperation-Organization  for  Economic  Cooperation  and 
Development.  A  new  working  party  on  monetary  and  fiscal  policies  has  been 
established  as  a  subcommittee  of  the  Economic  Policy  Committee  of  OEEC. 
It  is  meeting  at  four-to  six-week  intervals  in  Paris,  where  a  small  group  of  re- 
sponsible officials  can  discuss  questions  of  mutual  interest  and  concern,  and  gain 
a  practical  grasp  of  the  flexibility  which  exists  in  national  policies  to  help  dis- 
courage excessive  or  disequilibrating  movements  of  liquid  funds.  These  officials 
well  realize  that  international  financial  considerations  are  only  one  of  many  objec- 
tives that  must  be  taken  into  account  in  the  overall  financial  policy  of  a  nation. 
Yet  it  is  through  the  lessons  learned  last  year  and  through  consultations  of  this 
kind  that  progress  has  been  made  toward  a  better  coordinated  and  more  stable 
pattern  of  international  interest  rate  relationships  than  was  the  case  last  year. 
These  OECD  meetings  also  afford  an  opportunity  to  keep  the  basic  balance-of- 
payments  situation  under  scrutiny,  and  the  confrontation  serves  to  keep  both  the 
surplus  and  deficit  countries  aware  of  their  responsibilities  to  correct  their  posi- 
tions. At  the  same  time  the  International  Monetary  Fund  is  beginning  regular 
consultations  with  convertible-currency  countries,  thus  broadening  the  scope  of 
these  useful  periodic  reviews  which  previously  had  been  largely  confined  to  coun- 
tries maintaining  exchange  restrictions. 

The  need  to  strengthen  the  international  financial  system  and  improve  inter- 
national financial  cooperation  was  again  dramatized  recently  by  the  speculative 
movements  of  capital  that  developed  following  the  revaluations  of  the  German 
mark  and  the  Dutch  guilder  in  early  March.  The  methods  employed  on  that 
occasion  to  contain  these  movements  and  prevent  them  from  forcing  either  an 
undesirable  and  unnecessary  change  in  exchange  rates,  or  a  reversion  to  the  con- 
trols removed  only  after  such  painstaking  struggle  through  the  postwar  years, 
were  impressive.  Even  though  no  question  concerning  the  standing  of  the  dollar 
was  directly  involved  in  this  latest  speculative  flurry,  the  techniques  developed 
and  the  lessons  learned  through  the  close  day-by-day  contact  which  we  have 
maintained  with  various  European  monetary  authorities  during  this  period,  will 
have  lasting  value  to  the  United  States. 

I  believe  you  will  have  an  opportunity  to  explore  this  subject  further  tomorrow 
with  the  representatives  of  the  Federal  Reserve  Bank  of  New  York,  whose  opera- 
tional contacts  have  been  utilized  on  behalf  of  the  Treasury  as  our  fiscal  agent 
as  these  new  procedures  were  being  developed.  The  particular  techniques  used 
are  not  as  important,  however,  as  the  fact  that  ways  were  found  to  offset  specula- 
tive capital  flows  of  very  large  magnitude.  What  stands  out  against  the  back- 
ground of  uneasiness  prevailing  last  autumn  is  that  the  speculative  flows  which 
began  in  March  at  the  time  of  the  revaluations  of  the  mark  and  the  guilder  did 
not  precipitate  any  resumption  of  gold  purchases  by  foreigners.  Our  monetary 
gold  stock  has  actually  increased  by  more  than  $100  million  since  the  revaluations. 

We  have,  meanwhile,  initiated  a  number  of  measures  designed  to  diminish  the 
likeUhood  that  speculation  against  the  dollar  might  recur.  Our  decision  to  under- 
take limited  operations  in  forward  exchange  markets  represents  one  step  in  this 
direction. 

The  impact  of  the  currency  speculation  during  March  did  not  confine  itself  to 
the  markets  for  spot  exchange.  In  the  case  of  the  German  mark,  for  example, 
the  premium  on  the  forward  mark  rose  to  very  high  levels  immediately  following 
the  revaluation.  Had  this  premium  been  allowed  to  rise  unchecked,  it  might 
well  have  aggravated  the  speculative  conditions  prevailing  in  the  market.  How- 
ever, arrangements  were  worked  out  between  the  United  States  and  Germany 
whereby  a  stabilizing  influence  could  be  exerted  on  the  market.  It  is  our  inten- 
tion to  conduct  similar  operations  in  other  major  currencies  whenever  such  action 
appears  appropriate  and  useful.  I  might  point  out  that  although  the  recent  offi- 
cial operations  in  the  forward  exchange  market  have  been  directed  primarily  at 
suppressing  potential  speculation  on  currency  revaluations,  essentially  the  same 
techniques  can  be  used  to  exert  an  influence,  upward  or  downward,  on  the  covered 


378   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

interest  incentive  to  move  short-term  investment  funds  from  one  market  to 
another. 

Aside  from  these  operations  in  the  forward  market  the  Treasury,  through  the 
facihties  of  the  Federal  Reserve  System  and  in  cooperation  with  authorities 
abroad,  has  begun  to  acquire  modest  holdings  of  foreign  exchange  which  could 
be  sold  in  the  spot  market  should  the  dollar  again  come  under  pressure.  You  will 
recall,  for  example,  that  we  requested  Germany  to  make  some  marks  available  to 
us  temporarily  at  the  time  they  agreed  to  prepay  $587  million  of  their  official 
debt  to  the  United  States.  The  Treasury  has  also  taken  advantage  of  opportuni- 
ties to  acquire  certain  other  convertible  currencies  in  relatively  small  amounts 
during  recent  months.  Whereas  other  countries  have  long  been  in  a  position  to 
even  out  short-term  influences  on  their  currencies  through  sales  or  purchases  of 
dollars,  the  United  States,  because  it  held  no  convertible  currencies,  had  no  similar 
option.  Our  decision  to  acquire  small  balances  of  foreign  currencies  is  designed 
to  eliminate  or  reduce  this  disparity.  Henceforth,  in  order  to  indicate  clearly 
the  increased  strength  and  flexibility  of  our  position,  we  expect  to  include  holdings 
of  convertible  foreign  exchange  as  well  as  gold  in  the  reports  of  our  monetary 
assets. 

While  it  is  too  soon  to  judge  the  possibilities  for  lasting  effectiveness  of  these 
actions  in  dealing  with  disturbances  in  the  exchange  markets,  we  have  been 
highly  pleased  with  the  results  of  our  operations  thus  far.  Another  implication  of 
the  experiences  in  Europe  during  March  is  that  intercentral  bank  credits  can 
play  an  important  role  in  offsetting  the  destabilizing  effects  of  speculative  capital 
flows.  I  believe  the  various  participants  w^ould  agree,  however,  that  intercentral 
bank  credits  must  supplement  rather  than  replace  the  facilities  provided  by  the 
International  Monetary  Fund.  In  fact,  there  would  seem  to  be  considerable 
logic  in  an  arrangement  whereby  central  bank  credits  might  in  some  part  be 
repaid  or  refinanced  through  drawings  on  the  Fund  whenever  the  capital  flows 
that  had  initially  given  rise  to  the  interbank  credits  did  not  reverse  themselves 
quickly  enough  to  permit  repayment  by  this  means. 

I  should  point  out,  however,  that  the  Fund  at  the  moment  holds  only  moderate 
amounts  of  continental  European  and  Japanese  currencies  so  that  drawings  of 
these  currencies  by  the  United  States,  should  such  action  ever  seem  desirable, 
would  in  practice  be  restricted.  For  this  reason  among  others,  the  United  States 
is  participating  in  exploratory  discussions  which  we  hope  will  lead  to  an  agreement 
among  the  industrial  countries  to  provide  standby  credits  to  supplement  the 
Fund's  resources  of  needed  currencies.  Many  technical  questions  remain  to  be 
explored  in  this  approach,  but  there  seems  to  be  increasing  agreement  on  the 
need  for  standby  facilities  of  this  sort  to  deal  with  short-term  capital  flows. 

I  believe  it  would  be  premature  at  this  time  to  go  into  detail  on  the  technical 
aspects  of  any  change  that  might  be  made  in  the  operations  or  resources  of  the 
International  Monetary  Fund.  However,  I  think  it  is  fair  to  say  that  our  efforts 
at  the  moment  are  directed  toward  strengthening  the  existing  international 
framework,  and  improving  the  institutional  arrangements  for  making  more 
effective  use  of  present  world  reserves. 

There  has  been  considerable  public  discussion,  as  you  know,  of  proposals  for 
fundamental  changes  in  the  international  financial  system.  These  proposals 
arise  out  of  concern  that  over  the  longer  run,  injections  of  international  reserves 
may  be  needed  to  finance  a  growing  volume  of  trade  and  financial  transactions. 
Whether  there  in  fact  is  likely  to  be  a  shortage  of  aggregate  world  liquidity  some- 
time in  the  future,  and  specifically  whether  any  such  shortage  will  need  to  be 
corrected  by  creating  an  international  currency  to  replace  dollars  (and  sterling) 
as  official  reserves,  are  controversial  cjuestions  on  which  there  is  as  yet  no  agree- 
ment among  economists.  Therefore,  although  these  questions  need  to  be  included 
in  our  continuing  study  and  consideration  of  long-range  monetary  problems,  they 
seem  very  unlikely  to  be  matters  of  practical  policy  at  the  present  time.  Today 
our  problem  is  the  correction  of  imbalances  and  the  handling  of  excessive  shifts 
of  liquid  funds,  rather  than  a  shortage  of  overall  liquidity.  Indeed,  in  several 
countries  the  problem  is  to  direct  some  of  the  excess  liquidity  into  longer  term 
finance  through  long-term  capital  exports.  New  reserves  injected  into  the 
present  payments  situation  would  simply  move  to  the  centers  which  already  have 
excess  reserves. 

In  the  final  analysis  there  is  no  substitute  for  balance-of-payments  discipline 
in  this  or  any  economj^,  a  discipline  that  reaches  through  our  productivity  per- 


EXHIBITS 


379 


formance,  our  price  and  wage  performance,  our  governmental  budgetary  posi- 
tion, and  our  monetary  and  credit  policies.  Neither  the  force  nor  the  form  of 
this  discipline  is  materially  different  for  a  reserve-currency  country  than  for  any 
other.  But  because  of  its  position  as  the  principal  key-currency  country,  the 
United  States  does  have  a  special  position  of  prominence.  The  way  in  which  it 
acts  to  maintain  the  conditions  for  balance-of-payments  equilibrium  sets  the 
pace  for  many  other  countries  of  the  Western  Alliance,  all  of  whom  use  our  cur- 
rency in  carrying  on  their  trade,  and  in  supporting  their  own  monetary  reserves. 
In  that  sense  the  present  role  of  New  York,  and  thus  of  the  United  States,  as 
the  financial  center  for  the  world,  carries  great  responsibilities  and  great  oppor- 
tunities. The  further  shaping  of  that  role  will  clearly  benefit  from  periodic 
review  of  the  kind  that  Congress  is  initiating  with  the  meetings  beginning  here 
today. 

Table  I. —  United  States  balance  of  payments,  1958-60 

[In  billions  of  dollars] 


1958 

1959  1 

1960 

First 

quarter 

1961 

(seasonally 

adjusted) 

Basic  components: 

1.  U.S.  payments,  total ... 

27.4 

29.7 

30.1 

7  2 

2.         Merchandise  imports . 

13.0 
4.7 
3.4 
2.5 
3.1 
.7 

23.9 

15.3 
5.1 
3.1 
2.3 

3.0 

.8 

25.3 

14.7 
5.6 
3.0 
2.5 
3.4 
.8 

28.2 

3  4 

3.         Nonmilitary  services 

1  4 

4.         Military  expenditures  abroad 

.8 

5.  U.S.  direct  and  portfolio  investment  abroad 

6.  U.S.  Qovernment  grants  and  credits  (gross) 

7.  Pensions  and  remittances 

.5 

1.0 

2 

8.  U.S.  receipts,  total ._  . 

7  3 

9.         Merchandise  exports.. . 

16.3 

2.9 

3.8 

.3 

.5 

16.3 

3.U 

4.1 

.3 

.6 
1.1 

19.4 

3.2 

4.4 
.3 

.3 

.6 

5  0 

Nonmilitary  services: 
10.               Income  on  investments . 

g 

11.               Other 

1.1 

12.         Military  sales 

1 

13.         Foreign  direct  and  portfolio  investment  in  United 
States 

.1 

14.         Repayments  to  U.S.  Qovernment 

.  1 

15.  Basic  balance  (deficit  (— )) 

-3.6 

-4.3 

-1.9 

+.2 

Other  components: 

16.  U.S.  private  short-term  assets  abroad  (increase  (—)).-- 

17.  Unrecorded  inflow  (+),  or  outflow  (— ) 

-.3 

+.4 

-.1 

+.5 

-1.3 
-.6 

-.5 
+.1 

18.  Overall  balance  (deficit  (-)) 

-3.5 

-3.9 

-3.8 

—.3 

*Less  than  $50  mUlion. 

1  Excludes  U.S.  subscription  of  $1.4  billion  to  IMF. 

Note.— Excludes  military  grant  transactions. 


Tableau, — Net  changes  in  gold  and  dollar  holdings 
[Official  and  private  in  millions  of  dollars] 


1960 


Total  foreign  countries 

Latin  America 

Canada... 

U.K.  and  Sterling  Area. 

Continental  W.  Europe 

Other  foreign  countries- 
Japan 

Others 

International  institutions  L. 


+3,  927 


+3, 112 


-268 
+207 
+878 
+2,  876 
+234 
+379 
-145 


-228 
+218 
+2 
+2,  352 
+778 
+471 
+307 


+451 


+2, 854 


+3, 120 


-335 

+99 
+939 
+1,  908 
+509 
+602 
-93 


+1, 053 


I  Beginning  with  1959  includes  changes  in  dollar  holdings  of  international  shipping  companies  operating 
under  the  flags  of  Liberia,  Panama,  Honduras,  and  the  Bahamas. 


614359—62- 


-25 


380   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Exhibit  26. — Statement  by  Secretary  of  the  Treasury  Dillon  as  Governor  for  the 
United  States,  September  20,  1961,  at  the  discussion  of  the  Annual  Report  of 
the  International  Monetary  Fund 

First,  let  me  say  how  delighted  I  am  to  be  once  again  in  the  gracious  and  storied 
city  of  Vienna.  Since  my  last  visit  a  little  more  than  a  year  ago,  I  have  seen  fresh 
evidences  of  growth  and  change — change  that  reflects  the  industry,  the  imagina- 
tion, and  the  initiative  of  the  Austrian  people.  The  stability  of  the  Austrian 
Government  in  postwar  years,  the  extent  of  Austria's  remarkable  economic  re- 
surgence, the  unswerving  devotion  of  the  Austrian  people  to  democratic  principles 
all  are  features  of  modern  Austria  that  command  our  respect.  This  small  nation — 
this  revered  cradle  of  thought  and  culture — this  courageous  outpost  on  the 
frontiers  of  freedom — has  aroused  the  admiration  of  free  men  everywhere.  On 
behalf  of  my  Government — on  behalf  of  the  President  of  the  United  States,  who 
recalls  with  pleasure  the  warm  hospitality  he  received  here  last  June — I  wish  to 
say  that  we  consider  Vienna  to  be  a  most  auspicious  setting  for  the  important 
work  upon  which  we  are  embarked. 

During  the  past  year  the  International  Monetary  Fund,  under  the  distinguished 
leadership  of  Per  Jacobsson,  has  again  demonstrated  its  vital  importance  to  world 
monetary  stability  and  economic  growth. 

The  role  of  the  Fund  is  being  further  enhanced  at  this  meeting  where  we  have 
the  privilege  of  welcoming  to  our  deliberations  ten  new  countries — the  largest 
increase  in  a  single  year's  operations  since  the  Fund's  inception.  It  is  a  partic- 
ular pleasure  for  me  to  welcome  to  our  midst  our  good  friends  from  Cyprus, 
Laos,  Liberia,  Nepal,  New  Zealand,  Nigeria,  Portugal,  Senegal,  Sierra  Leone, 
and  Togo. 

Since  we  met  a  year  ago  in  Washington,  $2.4  billion  has 'been 'drawn  from  the 
Fund.  A  major  part  of  that  was  the  recent  drawing  by  the  United  Kingdom,  but 
21  other  member  countries  made  drawings  totaling  more  than  $980  million. 
There  are  also  20  standby  arrangements  in  eflfect,  with  unused  drawing  rights 
totaling  $1.2  billion. 

Fund  assistance  in  the  past  year  has  both  strengthened  the  structure  of  currency 
convertibility  in  the  industrialized  countries  and  helped  many  of  the  developing 
countries  to  adopt  or  maintain  programs  of  financial  and  monetary  stabilization. 
The  Fund  has  come  to  occupy  a  central  position  in  international  monetary 
affairs — a  role  I  am  confident  will  be  of  ever-increasing  importance  to  all  our 
member  countries  in  the  years  ahead. 

A  few  years  ago  almost  all  drawings  from  the  Fund  were  in  dollars.  Since  the 
advent  of  currency  convertibihty  in  Western  Europe,  however,  the  Fund  has 
made  great  progress  in  using  a  larger  number  of  the  currencies  it  holds,  thus 
increasing  the  percentage  of  drawings  in  currencies  other  than  U.S.  dollars. 
During  the  past  year,  eleven  different  currencies  were  drawn  from  the  Fund,  and 
two-thirds  of  the  total  drawings  were  in  currencies  other  than  the  dollar.  This 
is  an  encouraging  development.  It  has  made  a  reality  of  the  original  concept  of 
the  Fund  as  a  reserve  pool  of  many  currencies  for  the  use  of  members. 

Last  year  the  Fund's  advisory  activities  continued  on  a  broad  scale.  Wherever 
member  countries  have  sought  to  deal  effectively  with  financial  instability — by 
strengthening  their  fiscal  resources,  by  controUing  money  and  credit,  or  by  other- 
wise improving  their  financial  institutions — they  have  been  able  to  rely  on  the 
staff  of  the  Fund  for  expert  and  objective  advice. 

The  stabilization  programs  many  members  of  the  Fund  have  worked  out  and 
put  into  operation,  usually  with  Fund  advice,  have  at  times  been  criticized  on  the 
ground  that  they  have  supposedly  imposed  a  choice  between  stagnation  and  eco- 
nomic growth.  I  do  not  beUeve  that  this  is  a  correct  appraisal  of  the  role  played  by 
financial  stabihzation  in  economic  development.  I  agree  with  the  opinion 
expressed  by  Mr.  Jacobsson  in  his  brilliant  opening  statement:  That  the  aim  of  a 
well-designed  stabilization  program  is  to  eliminate  inflation,  not  only  as  a  source 
of  balance-of-payments  disequiUbrium,  but  also  as  an  obstacle  to  economic  growth. 
Financial  stability  can  thus  assist  economic  growth  which,  together  with  social 
progress,  must  be  the  major  objective  of  development  policy. 

Of  course,  financial  stability  cannot  of  itself  cure  all  the  problems  of  economic 
growth  that  beset  the  developing  countries.  Effective  development  planning, 
basic  internal  reforms,  and  adequate  capital  from  both  external  and  internal 
sources — all  are  necessary.  This  is  well  recognized  by  the  Fund,  which  is,  as  it 
should  be,  the  partner  of  economic  development  institutions,  national  and  inter- 
national, in  coordinated  efforts  to  increase  the  flow  of  external  assistance  and  to 


EXHIBITS  381 

help  the  developing  countries  make  the  best  use  of  their  own  domestic  resources. 

I  turn  now  to  the  economy  of  the  United  States  and  the  status  of  our  inter- 
national balance  of  payments. 

The  recovery  of  the  U.S.  economy,  following  the  mildest  of  our  postwar  reces- 
sions, is  well  under  way  and  moving  strongly.  The  low  point  in  economic  activity 
was  reached  in  the  first  quarter  of  this  year.  In  the  second  quarter  major  eco- 
nomic indicators  recorded  new  highs.  Gross  national  product,  personal  income, 
and  personal  consumption  expenditures  all  reached  fresh  peaks  in  the  April-June 
period.  Total  industrial  production  recorded  a  new  high  in  July  and  again  in 
August.  We  estimate  that  gross  national  product,  which  jumped  from  an  annual 
rate  of  just  over  $500  billion  at  the  beginning  of  the  year  to  $516  billion  in  the 
second  quarter,  will  reach  approximately  $540  billion  during  the  fourth  quarter. 
The  course  of  our  economic  recovery  has  been  particularly  encouraging  since 
prices  have  remained  stable.  Hence,  almost  the  entire  rise  in  our  gross  national 
product  has  been  real.  Moreover,  our  increased  economic  activity  has  not  been 
accompanied  by  speculative  buying  or  abnormal  buildup  of  inventories. 

During  the  past  year  the  monetary  and  fiscal  policies  of  the  United  States  have 
been  directed  at  limiting  the  extent  of  the  decline  in  economic  activity  and  at 
strengthening  the  forces  of  recovery.  Prompt  recognition  by  our  monetary 
authorities  of  the  impending  downturn  brought  a  quick  shift  of  policy  from 
monetary  restraint  to  ease.  As  early  as  June  of  last  year  the  Federal  Reserve 
relaxed  credit  restrictions  by  reducing  discount  rates  and  lowering  the  reserve 
requirements  of  commercial  banks.  Federal  Reserve  purchases  of  Government 
securities  provided  additional  bank  reserves  to  combat  recession  and  finance 
expansion.  Reflecting  this  Federal  Reserve  policy,  total  loans  and  investments  of 
commercial  banks  have  expanded  by  seven  percent,  or  $14  billion,  during  the  past 
12  months.  This  large  increase  provided  a  major  force  which  softened  the  strains 
of  recession  and  stimulated  recovery. 

On  the  fiscal  side  increased  unemployment  benefits  and  other  Government 
outlays  associated  with  the  recession,  in  conjunction  with  reduced  income  tax 
collections,  have  operated  as  in  previous  recessions  to  provide  an  automatic 
supporting  influence.  Largely  as  a  result  of  these  "built-in  stabilizers"  the  total 
value  of  all  goods  and  services  produced  during  the  economic  downturn  never  fell 
appreciably  below  the  corresponding  quarter  of  the  previous  year. 

As  I  noted  earlier,  we  are  especially  encouraged  that  our  recovery  and  our 
attainment  of  record  new  levels  of  production  have  been  accompanied  by  price 
stability.  Our  index  of  wholesale  prices  has  remained  for  three  years  at  virtually 
the  same  level.  Retail  commodity  prices  have  been  stable  while  the  overall  index 
of  consumer  prices  has  increased  by  less  than  one  percent  since  last  October. 

The  business  outlook  for  the  United  States  during  the  coming  year  is  very 
promising.  Excessive  stocks  have  been  liquidated.  As  a  result  of  rising  pro- 
duction and  sales,  inventories  have  once  more  begun  to  increase  moderatelj'  but 
they  are  not  high  in  relation  to  either  present  or  prospective  needs.  Consumers 
have  reduced  their  debt  and  built  up  their  savings,  thus  strengthening  the  outlook 
for  retail  trade.  Net  financial  savings  of  individuals  rose  by  $7.7  billion  in  the 
first  half  of  1961  on  top  of  a  $10  billion  rise  in  1960.  In  contrast  to  1958-59, 
interest  rates  have  remained  remarkably  constant  during  the  initial  recovery 
period. 

We  anticipate  further  vigorous  growth.  The  substantial  room  in  our  economy 
for  further  expansion  should  avert  any  inflationary  pressures  that  might  other- 
wise develop.  For  we  have  no  shortage  of  productive  resources,  nearly  all  of  our 
industries  are  operating  well  below  capacity  and  the  labor  supply  is  ample.  Con- 
tinued rises  in  output  should  materially  assist  us  in  solving  the  persisting  problem 
of  relatively  high  unemployment.  Nevertheless,  we  are  developing  worker  re- 
training programs  designed  to  attack  this  problem  directly. 

Federal  budget  expenditures  remain  well  within  our  capacity.  In  fact,  the 
deficit  for  fiscal  year  1961  and  the  projected  deficit  for  1962  are  together  much 
smaller  than  the  deficits  during  the  last  comparable  recession  and  recovery  in 
1958-59.  After  taking  into  account  all  presently  scheduled  expenditures,  in- 
cluding the  substantially  increased  outlays  for  defense  requested  by  President 
Kennedy  in  July,  our  estimates  point  to  a  deficit  this  year  (fiscal  1962)  that  will 
amount  to  about  half  the  deficit  for  fiscal  1959.  In  addition,  our  gross  national 
product  will  run  some  17  percent  higher  than  in  fiscal  year  1959,  and  our  tax 
revenues  will  be  about  21  percent  greater.  Hence,  the  economic  impact  of  the 
current  deficit  will  be  considerably  less  than  half  that  of  the  1959  deficit. 


382   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  deficits  in  fiscal  1961  and  1962  are  essentially  a  reflection  of  the  shortfall 
of  revenues  resulting  from  the  recent  recession.  This  is  a  characteristic  of  our  tax 
system  because  it  is  heavily  dependent  upon  direct  taxation  of  personal  and  busi- 
ness income.  For  the  same  reason  we  may  expect  sharp  increases  in  revenues  as 
business  improves  and  the  economy  grows.  The  calendar  year  1962  gives  every 
promise  of  being  a  very  good  year  for  business,  and  since  our  revenues  are  based 
upon  earnings  of  the  previous  year  we  can  confidently  look  forward  to  a  substan- 
tial increase  in  our  income  during  the  fiscal  year  1963,  which  begins  next  July 
first.  Fiscal  1963  will  be  closely  comparable  in  the  business  cycle  to  fiscal  1960, 
when  Federal  revenues  jumped  $10  billion  over  the  preceding  year.  Hence, 
unless  a  need  arises  for  further  increases  in  defense  outlays,  the  balanced  budget 
which  President  Kennedy  is  determined  to  submit  next  January  can  be  achieved 
without  any  increase  in  taxes.  However,  should  additional  defense  expenditures 
become  necessary  the  President  has  stated  clearly  and  unequivocally  that  he  is 
prepared  to  request  additional  taxes  should  they  be  required  to  balance  the 
budget. 

I  would  like  to  emphasize  the  firmness  of  our  decision  to  balance  our  budget  in 
fiscal  1963.  Indeed,  had  it  not  been  for  the  increase  in  international  tensions 
over  Berlin,  which  forced  us  to  increase  our  defense  expenditures  substantially 
above  the  levels  previously  planned,  we  could  have  looked  forward  confidently  to 
a  substantial  budgetary  surplus  in  fiscal  1963.  We  are  resolute  in  our  determi- 
nation to  maintain  both  a  sound  and  an  expanding  economy  so  that  the  United 
States  may  play  its  full  part  in  the  defense  and  the  development  of  the  free  world 
and,  at  the  same  time,  meet  the  requirements  of  an  increasing  population  at  home. 

I  am  glad  to  be  able  to  report  that  the  U.S.  balance  of  payments  has  developed 
in  a  m.uch  more  satisfactory  manner  this  year  than  in  1960.  The  marked  im- 
provement in  our  merchandise  accoimt  during  1960  continued  into  1961  and  the 
large  speculative  outflows  of  short-term  capita!,  which  swelled  the  volume  of  our 
outpayments  in  the  second  half  of  1960,  have  ceased.  Our  merchandise  trade 
surplus  in  1960  amounted  to  $4.7  billion,  whereas  in  1959  it  had  been  less  than 
$1  billion.  In  the  first  half  of  1961  our  trade  surplus  was  running  at  a  seasonally 
adjusted  annual  rate  of  $6  billion. 

These  developments  are  reflected  both  in  our  "basic"  position  (comprising  all 
of  our  recorded  transactions  exclusive  of  U.S.  private  short-term  capital  outflow) 
and  in  our  overall  pavments  position.  In  1960  the  basic  deficit  amounted  to  $1.9 
billion,  compared  with  $4.3  billion  in  1959  and  $3.6  biUion  in  1958.  In  the  first 
half  of  1961  the  basic  position  continued  the  substantial  improvement  shown  in 
1960  and,  without  counting  special  prepayments  of  $650  miflion  on  U.S.  Govern- 
ment loans,  was  almost  exactly  in  balance.  Our  overall  deficit,  which  is  measured 
by  decreases  in  U.S.  holdings'of  gold  and  convertible  currencies  plus  increases  in 
foreign  liquid  holdings  of  U.S.  dollars,  which  together  amounted  to  about  $4 
billion  in  both  1959  and  1960,  was  running  at  a  seasonally  adjusted  annual  rate 
somewhat  under  $1.7  billion  in  the  first  half  of  1961.  The  figure  of  $1.7  billion 
also  does  not  count  as  a  receipt  the  special  debt  prepayments  of  $650  million. 
While  this  indicates  the  continuation  of  substantial  short-term  capital  outflows, 
these  movements  have  represented,  for  the  most  part,  a  substantial  enlargement 
of  the  financing  of  world  trade  by  U.S.  banking  institutions  and  have  not  been 
speculative  in  character. 

These  are  encouraging  developments.  But  they  do  not  mean  that  the  United 
States  can  relax  its  efforts  to  achieve  a  satisfactory  and  durable  equilibrium  in 
its  balance  of  payments.  We  must  have  a  large  and  growing  export  surplus  of 
goods  and  services  to  pay  for  military  expenditures  abroad  which  we  incur  for 
the  defense  of  the  free  world.  We  must  have  it  for  both  that  portion  of  our 
foreign  aid  program  that  is  not  covered  by  procurement  in  the  United  States 
and  for  our  continuing  large  outflow  of  long-term  private  development  capital. 

The  improvement  in  our  trade  surplus  so  far  this  year  cannot  be  expected  to 
continue  in  the  months  ahead  since  it  was  accomplished  more  through  a  decrease 
in  imports  than  through  an  increase  in  exports.  And  now  as  the  U.S.  economy 
moves  toward  reasonably  full  employment  of  resources,  we  must  look  to  a  corre- 
sponding expansion  of  our  imports.  Indeed,  they  have  already  started  to  grow. 
While  this  tends  to  sharpen  our  payments  problem  it  also  leads  to  larger  world 
trade  and  greater  prosperity  for  our  trading  partners. 

Accordinglv,  we  must  continue  to  make  intensive  efforts  to  expand  our  exports. 
This  means  for  us,  as  it  does  for  any  nation,  that  we  must  constantly  improve 
the  productivity  on  which  the  ability  of  our  producers  to  compete  in  world  markets 
is  based.     It  also  requires  that  we  prevent  increases  in  money  costs  from  canceling 


EXHIBITS  383 

out  improvements  in  productivity.  At  the  same  time  our  producers  must  search 
out  export  opportunities  with  energy  and  imagination.  The  domestic  market 
of  the  United  States  is  a  very  large  one  and  many  of  our  producers  have  tradi- 
tionaUy  thought  almost  exclusively  in  terms  of  that  market,  rather  than  of 
opportunities  overseas.  We  believe  this  orientation  can  and  must  be  shifted, 
for  there  are  surely  thousands  of  our  producers  who  can  be  more  successful  in  the 
export  field  than  they  have  been  in  the  past.  It  is  for  this  reason  that  our  Govern- 
ment is  devoting  considerable  effort  to  bringing  market  opportunities  abroad 
to  the  attention  of  our  business  community. 

We  are  well  aware  that  the  position  of  the  dollar  as  a  strong  reserve  currencj^ 
depends  upon  our  success  in  maintaining  a  reasonable  equilibrium  over  the  years 
in  our  balance  of  payments.  This  we  are  determined  to  do.  As  we  succeed, 
the  upward  trend  in  the  accumulation  of  gold  and  dollars  by  other  countries 
taken  together  will  necessarily  be  slowed.  The  elimination  of  current  payments  im- 
balances can,  of  course,  be  greatly  facilitated  by  the  cooperation  of  surplus  countries 
in  pursuing  liberal  trade  pohcies,  in  increasing  long-term  development  assistance, 
and  in  sharing  expenditures  for  the  common  defense  in  accordance  with  their 
capabilities. 

During  the  past  year,  as  Mr,  Jacobsson  has  reminded  us,  there  has  been  active 
discussion  and  examination  in  governmental  circles,  among  economists,  and  in 
the  financial  press,  of  the  adequacy  of  existing  international  monetary  arrange- 
ments. These  discussions  have  been  very  helpful.  Mr  Jacobsson  has  now 
proposed  that  each  of  the  principal  industrial  countries  commit  itself  to  lend  its 
currency  to  the  Fund  up  to  a  stated  amount.  I  strongly  agree  that  an  arrange- 
ment of  this  sort  should  be  W'Orked  out  to  ensure  the  fund  access  to  the  additional 
amounts  that  would  be  needed  should  balance-of-payments  pressures  involving 
these  countries  ever  impair  or  threaten  to  impair  the  smooth  functioning  of  the 
world  payments  system. 

At  the  same  time,  for  its  regular  requirements  the  Fund  can,  and  should  be 
expected  to,  borrow  from  one  or  another  of  the  participating  countries  under 
Article  VII  whenever  its  supply  of  any  of  these  particular  currencies  becomes 
low.  It  would  also  appear  reasonable  to  consider  the  possibility  that  such  loans 
be  credited  against  any  commitment  which  the  lending  country  may  have  under- 
taken as  its  part  of  the  multilateral  arrangement.  These  special  bilateral 
borrowings  would  thus  replenish  the  Fund's  supply  of  particular  currencies  in 
strong  demand  and,  in  this  way,  would  help  to  avoid  undue  drains  on  its  gold 
reserve. 

I  have  no  fixed  opinions  on  the  details  of  the  multilateral  borrowing  arrange- 
ment. I  am  confident  on  the  basis  of  the  encouraging  views  I  have  heard  ex- 
pressed in  the  past  few  days  that  practical  means  can  be  found  to  give  effect  to 
the  agreement  in  principle  which  so  evidently  exists.  There  are  four  important 
aspects  which  I  do  wish  to  emphasize: 

First,  the  aggregate  amount  the  participating  countries  should  look  forward 
to  committing  to  the  project  should  be  large  enough  to  add  decisively  to  the 
Fund's  capacity  to  play  its  essential  role. 

Second,  to  be  effective,  the  additional  resources  must  be  promptly  available 
in  case  of  need. 

Third,  safeguards  will  be  required  to  ensure  that  there  will  be  effective  consul- 
tation between  the  Fund  and  the  lenders,  and  that  the  Fund  will  only  actually 
borrow  under  the  commitment  arrangements  after  taking  full  account  of  the  cur- 
rent reserve  position  of  the  lending  country.  In  addition,  each  country  which 
actually  lends  to  the  Fund  should,  in  case  the  need  develops,  be  able  automatically 
to  obtain  repayment  from  the  Fund. 

Fourth,  I  concur  in  Mr.  Jacobsson's  judgment  that  there  must  be  no  weakening 
of  the  policies  that  have  guided  the  Fund  in  the  use  of  its  resources;  nor  should 
the  new  arrangements  change  in  any  way  the  existing  rights  and  duties  of  members 
of  the  Fund,  both  as  drawers  of  currencies  and  as  providers  of  currencies. 

This  is  an  important  project.  The  Fund  should  push  ahead  promptly  in  its 
current  consultations  with  the  prospective  lending  countries  in  order  that  the 
Executive  Board  may  carry  the  project  to  completion  so  that  the  participating 
countries  may  obtain  the  necessary  legislative  authority  from  their  parliaments 
early  next  year.  With  this  done,  the  monetary  system  of  the  free  world  will  be 
substantially  strengthened.  For  the  Fund  will  then  clearly  be  in  a  position  to 
meet  the  changing  needs  of  the  new  world  of  convertible  currencies. 

Speaking  for  my  country,  I  want  to  say  that  the  United  States  regards  the  work 
in  which  we  are  engaged  here  in  Vienna  as  having  a  direct  and  important  bearing 


384   1961  KEPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

upon  the  future  course  of  free  world  growth  and  progress.  I  have  confidence  in 
the  ultimate  outcome  of  our  deliberations  because  I  have  confidence  in  the  vitality 
of  the  free  economies  upon  which  the  work  of  the  Fund  is  founded.  Our  mutual 
goal  is  a  world  of  expanding  opportunities  for  every  human  being  to  pursue  his 
legitimate  aspirations  in  peace  and  freedom.  The  International  Monetary  Fund 
is  playing  an  important  role  in  helping  us  to  achieve  it. 


Exhibit  27. — Statement  by  Assistant  Secretary  of  the  Treasury  Leddy  as  Tem- 
porary Alternate  Governor  for  the  United  States,  September  21,  1961,  at  the 
discussion  of  the  Annual  Report  of  the  International  Finance  Corporation 

It  gives  me  great  pleasure  to  join  in  paying  tribute  to  Robert  Garner,  our 
distinguished  President  and  good  friend,  as  he  approaches  his  retirement  next 
month  from  the  presidency  of  the  International  Finance  Corporation.  Robert 
Garner  is  the  pioneer  of  the  IFC.  It  was  his  wise  leadership  which  guided  this 
novel  institution  through  its  critical  early  years  of  experimentation  in  an  untested 
field. 

We  all  know  how  difficult  his  task  has  been.  From  the  beginning  the  IFC  has 
been  handicapped  by  the  limitation  in  its  Articles  of  Agreement  prohibiting  the 
Corporation  from  investing  in  capital  stock.  Happily  this  prohibition  has  now 
been  removed  with  the  approval  last  month  of  an  amendment  to  the  Articles  of 
Agreement.  The  large  favorable  vote  on  the  amendment,  reflecting  approval  by 
88  percent  of  the  Governors  and  94  percent  of  the  total  voting  power,  is  due  in  no 
small  measure  to  the  unceasing  efforts  of  President  Garner  to  make  the  IFC  a 
vital  and  progressive  institution.  We  extend  to  him  our  admiration,  our  warm 
thanks,  and  every  good  wish  for  the  future.  To  Eugene  Black,  the  new  President, 
and  to  Martin  Rosen,  who  holds  the  newly  created  office  of  Executive  Vice  Pres- 
ident, we  offer  our  full  cooperation  and  our  hopes  for  every  success  in  steadily 
enlarging  the  role  and  influence  of  the  IFC  in  furthering  private  enterprise  in  the 
developing  countries. 

Despite  the  serious  restrictions  in  its  charter,  the  IFC  has  succeeded  in  making 
45  business  investments  in  18  member  countries  for  a  total  of  almost  $58  million. 
Of  this  total,  over  $13  million  represents  five  commitments  entered  into  during 
the  last  three  months,  signifying  a  sharp  increase  in  activity. 

The  IFC  is  the  only  intergovernmental  financial  institution  established  solely 
for  the  purpose  of  investing  directly  in  private  enterprise  in  the  developing 
countries.  And  for  each  dollar  of  IFC  money  several  additional  dollars  of 
private  money  have  gone  into  enterprises  in  which  the  IFC  has  invested.  Thus, 
we  estimate  that  total  investment  generated  by  the  IFC  has  been  in  the  neigh- 
borhood of  $200  million. 

Since  IFC's  total  authorized  capital  of  $100  million  is  relatively  small,  it  is 
especially  important  for  the  IFC  to  replenish  its  funds  by  selling  its  invest- 
ments in  completed  projects  to  private  investors.  So  far  the  Corporation  has 
been  able  to  make  little  progress  in  this  direction,  mainly  because  the  prohibition 
against  investment  in  capital  stock  has  forced  the  Corporation  to  utilize  devices 
such  as  convertible  debentures,  stock  options,  and  contingent  interest  arrange- 
ments which  are  complicated,  little  known,  and  not  readily  marketable  in  the 
developing  countries.  Now  that  the  Corporation  has  been  authorized  by  the 
new  amendment  to  invest  in  capital  stock,  including  common  shares,  we  have 
every  reason  to  hope  that  it  will  be  able  to  sell  its  portfolio  much  more  readily 
and  thus  truly  revolve  the  limited  capital  at  its  disposal. 

The  new  amendment,  while  enabling  the  Corporation  to  invest  in  common 
stock,  does  not  permit  it  to  participate  in  the  management  of  private  enterprise 
except  to  protect  its  interests  in  cases  of  default  or  jeopardy.  It  is  the  hope 
of  the  United  States  that  the  need  for  exercising  this  protective  power  will  be 
rare.  We  are  sure  that  the  officers  of  the  Corporation  have  no  desire  or  inten- 
tion that  it  intervene  in  operations  which  are  properly  within  the  domain  of 
private  management. 


EXHIBITS  385 

The  Corporation  now  has  greater  flexibility  to  take  full  advantage  of  the 
opportunities  open  to  it  for  stimulating  private  investment  and  enterprise.  We 
are  confident  that  it  will  move  forward  vigorously  in  carrying  out  its  important 
tasks. 

In  closing,  may  I  extend  a  warm  welcome  to  our  new  members — we  look 
forward  to  a  close  association  with  them  in  the  work  of  the  Corporation  which 
lies  ahead. 


Exhibit  28. — Statement  by  Assistant  Secretary  of  the  Treasury  Upton,  August 
15,  1960,  before  the  Senate  Foreign  Relations  Committee  on  the  President's 
proposal  for  Latin  America 

I  am  happy  to  appear  on  behalf  of  the  Treasury  Department  in  support  of  the 
President's  proposal  for  Latin  America.  The  Treasury  has  a  deep  interest  in  our 
financial  relations  with  Latin  America.  As  you  know,  the  Treasury  Department 
presented  to  the  Congress  last  year  recommendations  for  the  formation  of  the 
Inter-American  Development  Bank,  which  the  Congress  approved.  It  is  antici- 
pated that  the  Inter-American  Development  Bank  will  take  an  active  role  in 
the  implementation  of  the  program  which  is  being  presented  to  you. 

We  see  this  program  as  a  major  and  significant  step  in  the  evolution  of  the 
historic  close  relations  among  the  American  Republics.  As  the  President's 
message  indicated,  what  is  envisaged  here  is  a  direct  approach  to  some  of  the 
problems  of  the  average  man  in  Latin  America.  We  are  confident  that  the  Latin 
American  countries  wish  to  direct  their  own  efforts  increasingly  to  this  objective, 
and  the  purpose  of  our  program  is  to  supplement  and  encourage  these  additional 
steps.  We  would  cooperate  with  individual  Latin  American  countries  in  their  own 
efforts  to  provide  for  the  individual  citizen.  He  needs  such  things  as  improved 
community  facilities  and  an  opportunity  to  work  land  which  is  not  now  being  used 
productively.  We  expect  that  under  the  authorization  being  requested,  we  should 
be  able  to  extend  our  assistance  in  such  areas  as  pilot  and  self-help  housing  and 
vocational  education.  Measures  of  this  type  will,  as  the  President  said,  "help  our 
Latin  American  neighbors  accelerate  their  efforts  to  strengthen  the  social  and 
economic  structure  of  their  nations  and  improve  the  status  of  their  individual 
citizens." 

While  we  will  press  forward  with  our  efforts  to  assist  constructive  economic 
development  activities,  the  new  program  would  seek  to  assist  in  spreading  the 
benefits  of  economic  growth.  The  proposal  is  supplemental  to  the  long  history  of 
our  previous  efforts  taken  to  promote  economic  and  industrial  development 
through  loans  for  dams,  power,  airports,  railroads,  and  factories. 

The  U.S.  program,  including  the  present  proposal,  can  be  considered  as  providing 
support  for  the  broad  objectives  of  Operation  Pan  America,  which  was  conceived 
some  two  years  ago  by  President  Kubitschek  of  Brazil.  There  is,  however,  some 
difference  of  emphasis.  President  Eisenhower's  proposal  would  promote  demo- 
cratic freedom  by  giving  particular  attention  to  social  aspects  of  the  Latin  Ameri- 
can problem  and  to  the  objective  of  spreading  the  benefits  of  economic  growth 
and  advancing  the  status  of  individual  people  in  these  nations. 

In  considering  this  new^endeavor  it  is  necessary  to  recognize  the  special  place 
of  the  American  Republics  in  their  historical  association  with  the  United  States 
and  the  particular  importance  to  us  of  these  neighboring  countries  in  the  southern 
parts  of  this  hemisphere.  We  have  a  long  history  of  a  special  political  relationship 
with  the  American  Republics.  More  recently  that  special  relationship  has  been 
highhghted  in  the  economic  and  financial  field  by  the  establishment  of  the  Inter- 
American  Development  Bank.  The  proposal  now  before  you  represents  our 
belief  that  the  time  has  come  to  underline  this  relationship  still  further  and  with 
particular  stress  upon  the  status  of  the  individual  citizen  and  his  opportunity  for 
advancement.  Economic  development  by  itself  does  not  fully  meet  the  need  in 
Latin  America  to  promote  growth  with  social  stability. 


386   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

In  our  relations  with  leaders  of  Latin  American  countries  we  have  sensed  an 
increasing  note  of  urgency  about  the  importance  of  stressing  activities  which  would 
contribute  directly  and  relatively  quickly  to  the  economic  and  social  progress  of 
individual  citizens.  During  most  of  the  postwar  3'^ears  Latin  America  has  con- 
centrated on  the  development  of  industries  and  other  directly  productive  economic 
areas.  Our  neighbors  have  come  to  us  for  financial  support  for  these  activities, 
and,  as  is  well  known,  they  have  obtained  large  amounts  of  financing.  Great 
strides  have  been  achieved  in  general  economic  progress.  Indeed  during  many  of 
the  postwar  years  the  growth  of  the  gross  national  product  in  many  Latin  American 
countries  has  proceeded  more  rapidly  than  in  most  other  parts  of  the  world. 

It  is  evident  that  the  United  States  and  the  international  institutions  have  been 
doing  a  great  deal  toward  advancing  economic  development  in  Latin  America. 
We  expect  to  be  doing  even  more  through  the  Inter-American  Development  Bank. 
The  Export-Import  Bank  has  been  particularly  active  in  Latin  America,  and  of 
its  total  current  loans  about  $1.5  billion,  or  45  percent,  pertains  to  this  area. 
(The  total  loans  of  the  Bank  include  nondevelopment  loans,  particularly  to 
European  countries;  therefore  Latin  America's  share  of  development  loans  is 
even  higher.)  The  World  Bank  has  some  21  percent,  or  almost  $800  million,  of 
its  current  loans  in  Latin  America.  The  International  Monetary  Fund  has  given 
repeated  and  active  support  to  overcoming  the  exchange  problems  of  Latin 
American  countries.  At  present  it  has  more  than  $415  million  in  short-term 
credits  outstanding  to  these  countries.  Furthermore,  there  is,  of  course,  a  very 
large  investment  of  private  American  capital  south  of  our  border  totaling  ap- 
proximately $9  billion  in  the  other  American  RepubHcs.  About  31  percent  of  our 
total  private  foreign  investments  are  situated  in  Latin  America. 

Nevertheless,  there  are  many  problems  remaining  in  Latin  America.  Some  of 
these  have  their  roots  in  poHtical  and  social  history,  in  degree  and  type  of  economic 
activity,  in  climate,  and  many  other  factors.  One  of  the  major  problems  is  the 
extremely  rapid  rate  of  increase  in  population.  It  has  been  estimated  that  in 
the  case  of  a  few  countries  the  population  may  as  much  as  triple  by  the  end  of  this 
century.  Without  improved  faciUties  for  utilization  of  land  and  settlement  of  a 
growing  population  on  new  land,  there  is  a  movement  to  the  cities  where  the 
increasing  numbers  put  a  very  heavy  strain  on  community  facilities. 

In  struggling  with  these  problems,  the  Latin  countries  have  faced  many  difficul- 
ties due  to  the  overall  limitations  on  available  resources  and  the  many  competing 
demands  for  their  use.  These  countries  have  also  found  impediments  in  the  way 
of  mobilizing  effectively  their  financial,  human,  and  physical  means  to  organize 
and  carry  out  advancement  in  these  fields.  We  all  recognize,  I  am  sure,  that  there 
is  everywhere  tremendous  competition  for  available  resources  and  savings.  But 
such  competition  is  more  acute  when  the  total  production  of  a  country  is  limited 
and  when  its  population  is  rapidly  increasing. 

A  special  problem  in  many  Latin  American  countries  has  been  the  development 
of  financial  policies  to  enable  currencies  to  be  strengthened  and  inflation  to  be 
brought  vmder  control.  Deficit  financing  on  an  excessive  scale  and  rapid  inflation 
have  driven  capital  abroad  and  have  distorted  the  pattern  of  savings  and  their 
effective  use.  Inflation  has  brought  its  usual  consequences  of  speculative  in- 
vestment and  of  particularly  heavy  burdens  for  the  large  groups  of  the  community 
who  are  least  able  to  protect  themselves  against  the  threat  to  real  incomes  which 
inflation  presents.  In  recent  years  an  increasing  number  of  Latin  American 
countries  have  recognized  the  need  for  ending  the  vicious  cycle  of  inflation  if  they 
are  to  survive  economically  and  progress  socially.  It  is  gratifying  that  several 
countries  have  recently  seen  considerable  success  in  their  stabilization  efforts. 
In  due  course,  as  savings  are  encouraged  and  capital  markets  develop,  the  social 
values  of  a  stable  currency  are  increasingly  demonstrated. 

I  have  listed  some  of  the  factors  which  I  believe  create  an  urgent  demand  for 
the  proposals  envisaged  by  this  legislation.  If  this  program  is  approved,  we  shall 
be  able  to  work  with  the  countries  of  Latin  America  by  providing  financing  to 
supplement  the  investment  of  additional  domestic  resources  in  the  direction  which 
many  of  their  leaders  increasingly  believe  requires  a  higher  priority. 


EXHIBITS  387 

In  the  implementation  of  this  program  we  propose  to  be  flexible.  We  will 
seek  to  concentrate  our  efforts,  in  cooperation  with  Latin  American  countries, 
in  the  particular  situations  and  areas  where  our  assistance  will  be  most  valuable 
and  effective.  As  Mr.  Dillon  has  indicated,  it  is  expected  that  the  Inter-American 
Development  Bank  will  become  the  principal  institution  for  administering  loans 
under  the  special  program  for  Latin  America.  The  Inter-American  Development 
Bank  was  organized  only  this  year  and  it  will  not  officially  open  its  doors  for  loans 
for  another  six  weeks.  But  its  potential  for  promoting  economic  progress  in 
Latin  America  has,  I  feel,  already  been  demonstrated  by  the  practical  and  coop- 
erative atmosphere  which  surrounded  the  work  of  building  the  structure  of  the 
Bank  and  by  the  high  quality  of  the  Bank's  Board  of  Directors  and  Management. 

In  the  ultimate  analysis,  we  can  provide  seed  capital,  technical  assistance,  and 
assist  in  meeting  some  of  the  more  drastic  needs  in  some  areas.  The  overall 
problems  are  so  large,  and  so  complex,  and  are  so  intimately  related  to  the  institu- 
tions and  the  economic  and  social  capacities  and  capabiHties  of  each  country,  that 
only  the  Latin  American  people  themselves,  and  particularly  their  leaders,  can 
effectively  deal  with  them.  In  the  utihzation  of  land,  and  in  the  various  areas  of 
pubUc  administration  and  pubhc  finance,  I  beHeve  they  realize  increasingly  the 
challenges  before  them  and  wish  to  face  up  to  them.  Through  the  present  pro- 
posal we  can  give  encouragement  and  emphasis  to  an  approach — directed  straight 
to  the  heart  of  the  problem — the  simple  needs  of  the  common  man  in  Latin 
America.  I  sincerely  hope  that  this  Congress,  so  many  members  of  which  have 
shown  themselves  cognizant  and  actively  interested  in  Latin  America,  will  give  its 
support  to  tills  proposal. 


ExfflBiT  29. — Press  release,  August  9,  1960,  announcing  the  signing  of  the  Arti- 
cles of  Agreement  of  the  International  Development  Association 

Secretary  of  the  Treasury  Robert  B.  Anderson  today  signed  the  Articles  of 
Agreement  of  the  International  Development  Association  (IDA)  on  behalf  of 
the  United  States.  Mr.  Anderson  acted  in  his  capacity  as  U.S.  Governor  of  the 
International  Bank  for  Reconstruction  and  Development  (Wond  Bank),  of 
which  the  new  Association  is  to  be  an  affiliate. 

The  IDA  is  designed  to  complement  the  World  Bank  by  providing  develop- 
ment financing  in  less-developed  countries  on  terms  which  are  more  flexible  and 
bear  less  heavily  on  the  balance  of  payments  than  the  terms  of  conventional 
loans.  IDA  is  to  have  initial  subscriptions  from  its  members  totahng  $1  billion, 
payable  over  a  five-j^ear  period.  Of  this,  the  U.S.  subscription  is  $320  million. 
Seventeen  other  economically  strong  members  are  to  subscribe  a  total  of  $443 
million,  payable  in  gold  or  freely  convertible  currency,  and  the  balance  is  to  be 
subscribed  by  the  less-developed  members,  largely  in  their  own  currencies.  The 
Articles  of  Agreement  also  provide  a  means  whereby  one  member  may  under 
appropriate  circumstances  transfer  to  IDA  the  local  currency  of  another  member. 

Membership  in  the  IDA  is  open  to  the  68  member  countries  of  the  World 
Bank,  and  becomes  effective  as  soon  as  member  countries  whose  subscriptions 
amount  to  65  percent  ol  the  $1  billion  total  accept  the  IDA  Articles  of  Agreement, 
but  not  prior  to  September  15.  It  is  hoped  that  the  65  percent  figure  will  be 
achieved  by  that  date,  so  that  TDA's  entry  into  force  under  the  terms  of  the 
Agreement  could  be  formally  announced  at  the  annual  meeting  of  the  Board  of 
Governors  of  the  World  Bank  in  Washington  late  in  September.  Financial 
operations  by  the  agency  could  start  shortly  thereafter. 

Also  signing  the  IDA's  Articles  of  Agreement  today  were  Canada  and  Honduras. 
As  a  result  of  today's  actions,  subscriptions  now  amount  to  43.1  percent  of  the 
$1  biUion  total.  Legislative  action  has  been  completed  by  a  substantial  number 
of  other  countries,  thus  opening  the  way  for  additional  signatures  in  the  near 
future. 


388   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

The  new  organization  is  the  outgrowth  of  a  U.S.  suggestion  originally  put  for- 
ward early  in  1958  by  Senator  A.  S.  Mike  Monroney  of  Oklahoma.  At  President 
Eisenhower's  request  Secretary  Anderson,  Under  Secretary  of  State  Dillon,  and 
other  U.S.  officials  took  the  initiative  at  the  1958  annual  meeting  of  the  World 
Bank  in  New  Delhi  and  the  1959  annual  meeting  in  Washington,  and  in  the  inter- 
vening period  in  moving  the  project  closer  to  reality.  In  the  fall  of  1959  active 
negotiations  were  undertaken  by  the  Executive  Directors  of  the  International 
Bank.  In  January  1960  the  Executive  Directors  submitted  the  present  Articles 
of  Agreement  to  member  governments  for  action. 

Legislative  action  in  the  United  States  was  completed  by  the  Congress  early 
in  July.  The  Congress  authorized  the  President  to  accept  U.S.  membership  in 
IDA  with  a  subscription  of  $320.29  million  and  appropriated  $73,666,700  to  pay 
the  first  installment  on  the  U.S.  subscription.  This  payment  is  to  be  made 
within  thirty  days  after  IDA  begins  operations. 


Exhibit  30.^ — Press  release,  January  6,  1961,  on  extending  the  exchange  agree- 
ment between  the  United  States  and  Argentina 

Robert  B.  Anderson,  Secretary  of  the  Treasury,  and  Emilio  Donato  del  Carril, 
Ambassador  of  Argentina,  today  signed  a  one-year  extension  of  the  $50,000,000 
exchange  agreement  between  the  U.S.  Treasury  and  the  Government  and  Central 
Bank  of  Argentina,  which  had  been  in  force  during  1960. 

The  agreement  is  designed  to  assist  Argentina  in  its  continuing  efforts  to  promote 
economic  stability  and  freedom  in  its  trade  and  exchange  system.  Exchange 
operations  on  the  part  of  the  Argentine  authorities  will  be  for  the  purpose  of  main- 
taining an  orderl}'  foreign  exchange  sj'stem. 

Under  the  Treasury  exchange  agreement,  Argentina  may  request  the  United 
States  Exchange  Statailization  Fund  to  purchase  Argentine  pesos.  Any  pesos 
acquired  by  the  U.S.  Treasury  would  subsequently  be  repurchased  by  Argentina 
with  dollars. 

With  the  purpose  of  assisting  the  Argentine  Government  in  continuing  its 
stabilization  efforts,  by  providing  currencies  that  may  be  used  tor  the  maintenance 
of  an  orderly  exchange  market,  the  International  Monetary  Fund  on  December  9, 
1960,  announced  a  standby  arrangement  with  Argentina  in  the  amount  of  $100 
million. 


Exhibit  31.— Press  release,  February  10,  1961,  on  the  signing  of  an  exchange 
agreement  between  the  United  States  and  Chile 

Secretary  of  the  Treasury  Douglas  Dillon,  and  Walter  Muller,  Ambassador  of 
Chile,  today  signed  an  exchange  agreement  in  the  amount  of  $15  million. 

Under  the  agreement,  which  will  run  for  one  year,  Chile  may  request  the  United 
States  Exchange  Stabilization  Fund  to  purchase  Chilean  pesos  should  the  occasion 
for  such  purchases  arise.  Any  pesos  so  acquired  by  the  U.S.  Treasury  would 
subsequently  be  repurchased  by  Chile  for  dollars. 

This  exchange  agreement  is  designed  to  assist  the  continuing  efforts  of  Chile 
to  consolidate  economic  stabilization  and  freedom  in  its  trade  and  exchange 
system,  while  Chile  pursues  a  program  of  reconstruction  from  the  damage  of  the 
severe  earthquakes  of  May  1960  and  a  program  of  general  economic  development. 
The  Chilean  Government  has  stated  that  exchange  operations  on  the  part  of  the 
authorities  will  be  conducted  to  minimize  exchange  rate  fluctuations  arising  from 
purely  temporarj^  or  erratic  influences  which  do  not  reflect  a  fundamental  trend 
in  the  market. 

The  agreement  with  the  U.S.  Treasury  supplements  the  $75  million  standby 
arrangement  with  the  International  Monetary  Fund  which  was  also  announced 
today. 


EXHIBITS 


389 


Organization  and  Procedure 

Exhibit  32. — Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the 
Treasury  Department  from  September  11,  1789,  to  January  20,  1961,  and  the 
Presidents  under  whom  they  served 


Term  of  service 


From — 


Sept.  11,1789 
Feb.  3, 1795 


Jan.  1, 
May  14, 

Feb. 
Oct. 

Oct.  22. 

Mar.  7, 
Mar.  6. 

Aug. 
May  29, 
Sept.  23, 
July  1 

Mar.  6 
Sept.  13 
Mar.  8 
July  4 
Mar. 
Mar. 


July 

Mar. 

Mar. 

Dee. 

Jan. 

Mar. 

July 

Mar. 

Mar. 

Mar. 

June 
July 
Mar. 
Mar. 
Nov. 
Sept. 
Oct. 
Mar. 
Apr. 

Mar. 
Feb. 


Mar.  7, 
Mar.  6, 

Feb.  1 

Mar.  4, 
Mar.  8, 
Mar.  6, 
Dec.  16, 
2, 
4, 


Feb. 
Mar. 


Feb.  13 
Mar.  4 
Jan. 


1801 
1801 

1814 
1814 

1816 
1825 
1829 

1831 
1833 
1833 
1834 

1841 
1841 
1843 
1844 
1845 
1849 

1850 
1853 
1857 
1860 
1861 
1861 
1864 
1865 
1869 
1873 

1874 
1876 
1877 
1881 
1881 
1884 
1884 
1885 
1887 

1889 
1891 

1893 

1897 

1902 
1907 
1909 
1913 
1918 
1920 
1921 

1932 
1933 
1934 


To— 


Jan.    31,1795 
Dec.  31,1800 


May  13, 
Feb. 


Oct. 
Oct. 


Mar.  6, 
Mar.  5, 
June  20. 

May  28, 
Sept.  22, 
June  25, 
Mar.    3 

Sept.  11 
Mar.  1 
May  2, 
Mar.  7 
Mar.  5 
July   22, 


Mar. 
Mar. 
Dec. 
Jan. 
Mar. 
June 
Mar. 
Mar. 
Mar. 
June 


June  20 
Mar. 
Mar.  3, 
Nov.  13 
Sept.  4 
Oct.  30 
Mar.  7 
Mar.  31 
Mar.    6 

Jan.    29, 
Mar.    6. 

Mar.    5, 

Jan.    31 

Mar.  3, 
Mar.  7 
Mar.  5, 
Dec.  15 
Feb. 
Mar.  3, 
Feb.  12, 


Mar.  3, 
Dec.  31 
July   22 


July  23,1945  June  23,1946 

June  25, 1946  Jan.  20, 1953 

Jan.  21,1953  July  28,1957 

July  29,1957  Jan.  20,1961 

Footnotes  at  end  of  table. 


1801 
1814 

1814 
1816 

1825 
1829 
1831 

1833 
1833 
1834 
1841 

1841 
1843 
1844 
1845 
1849 
1850 

1853 
1857 
1860 
1861 
1861 
1864 
1865 
1869 
1873 
1874 

1876 

1877 
1881 
1881 
1884 
1884 
1885 
1887 


1891 
1893 

1897 

1902 

1907 
1909 
1913 
1918 
1920 
1921 
1932 

1933 
1933 
1945 


Official 


Secretaries  of  the  Treasury 

Alexander  Hamilton,  New  York_ 
Oliver  Wolcott,  Connecticut 


Samuel  Dexter,  Massachusetts. .. 
Albert  Gallatin,  Pennsylvania  '— 

George  W.  Campbell,  Tennessee. 
Alexander   J.    Dallas,    Pennsyl- 
vania. 

Wm.  H.  Crawford,  Georgia 

Richard  Rush,  Pennsylvania  2 

Samuel    D.    Ingham,    Pennsyl- 
vania.^ 

Louis  McLane,  Delaware 

Wm.  J.  Duane,  Pennsylvania 

Roger  B.  Taney,  Maryland 

Levi   Woodbury,   New   Hamp- 
shire. 

Thomas  Ewing,  Ohio 

Walter  Forward,  Pennsylvania... 

John  C.  Spencer,  New  York  ^ 

Geo.  M.  Bibb,  Kentucky 

Robt.  J.  Walker,  Mississippi 

Wm.    M.    Meredith,    Pennsyl- 
vania. 

Thos.  Corwin,  Ohio 

James  Guthrie,  Kentucky 

Howell  Cobb,  Georgia 

Philip  F.  Thomas,  Maryland 

John  A.  Dix,  New  York 

Salmon  P.  Chase,  Ohio 

Wm.  P.  Fessenden,  Maine 

Hugh  McCulIoch, Indiana  5 

Geo.  S.  Boutwell,  Massachusetts. 
Wm.  A.  Richardson,  Massachu- 
setts. 

Benj.  H.  Bristow,  Kentucky 

Lot  M.  Morrill,  Maine 

John  Sherm.an,  Ohio 

Wm.  Windom,  Minnesota  « 

Chas.  J.  Folger,  New  York 

Walter  Q.  Gresham,  Indiana 

Hugh  McCulloch,  Indiana  5 

Daniel  Manning,  New  York 

Chas.  S.  Fairchild,  New  York 


Wm.  Windom,  Minnesota «. 
Chas.  Foster,  Ohio.. 


John  G.  Carlisle,  Kentucky. 
Lyman  J.  Gage,  Illinois 


L.  M.  Shaw,  Iowa 

George  B.  Cortelyou,  New  York.. 

Franklin  MacVeagh,  Illinois 

W.  G.  McAdoo,  New  York 

Carter  Glass,  Virginia 

David  F.  Houston,  Missouri 

Andrew   W.    Mellon,    Pennsyl- 
vania. 

OgdenL.  Mills,  New  York 

William  H.  Woodin,  New  York... 
Henry    Morgenthau,    Jr.,    New 
York. 

Fred  M.  Vinson,  Kentucky 

John  W.  Snyder,  Missouri 

George  M.  Humphrey,  Ohio 

Robert  B.  Anderson,  Connecticut. 


Served  Under- 


Secretary  of  the 
Treasury 


President 


Washington. 
Washington, 

Adams. 
Adams,  Jefferson. 
Jefferson, 

Madison. 
Madison. 
Madison. 

Madison,  Monroe. 
Adams,  J.  Q. 
Jackson. 

Jackson. 
Jackson. 
Jackson. 
Jackson,  Van 

Buren. 
Harrison,  Tyler. 
Tyler. 
Tyler. 
Tyler,  Polk. 
Polk. 
Taylor,  Fillmore. 

Fillmore. 

Pierce. 

Buchanan. 

Buchanan. 

Buchanan. 

Lincoln. 

Lincoln. 

Lincoln,  Johnson. 

Grant. 

Grant. 

Grant. 

Grant,  Hayes. 

Hayes. 

Garfield,  Arthur. 

Arthur. 

Arthur. 

Arthur,  Cleveland. 

Cleveland. 

Cleveland, 

Harrison. 
Harrison. 
Harrison, 

Cleveland. 
Cleveland, 

McKlnley. 
McKinley, 

Roosevelt. 
Roosevelt. 
Roosevelt. 
Taft. 
Wilson. 
Wilson. 
Wilson. 
Harding,  Coolidge, 

Hoover. 
Hoover. 
Roosevelt. 
Roosevelt. 

Truman. 
Truman. 
Truman. 
Eisenhower. 
Eisenhower. 


390    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Exhibit  32. — Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the 
Treasury  Department  from  September  11,  1789,  to  January  20,  1961,  and  the 
Presidents  under  whom  they  served — Continued 


Term  of  service 


Official 


Served  Under- 


Secretary  of  the 
Treasury 


President 


July  1,1921 
Nov.  20, 1923 
Mar.  4,1927 
Feb.  13,1932 
May  19,1933 
Nov.  17, 1933 

May    2,1934 

Jan.  29,1937 
Nov.  1,1938 
Jan.  18,1940 

Mar.  4,1946 
Jan.  23,1947 

July  15,1948 
Jan.  28,1953 
Aug.  3,1955 
Aug.  9,1957 


Aug.  3,1954 
Sept.  30, 1957 


Mar. 
Oct. 
Nov. 
Mar. 

Mar. 

Mar. 

Mar. 

Jan. 

July 


12, 1849 

10. 1849 

16. 1850 
14, 1853 

13, 1857 

13, 1861 

18, 1864 

5, 1865 

11,1865 


Dec.  2, 1867 
Mar.  20, 1869 


Mar.  8,1873 
July  1, 1874 


Mar.  4,1875 
Aug.  12,1876 


Apr.  3, 1877 

Dec.  9, 1877 

Apr.  10,1880 

Feb.  28,1882 

Apr.  17,1884 


Mar.  14, 1885 
Nov.  10,1885 
July  12,1886 


Nov.  17, 1923 
Feb.  1, 1927 
Feb.  12, 1932 
May  1.5,1933 
Nov.  16, 1933 
Dec.  31,1933 

Feb.  15,1936 

Sept.  15,1938 
Dec.  31, 1939 
Dec.  31,1945 

Jan.  14,1947 
July   14,1948 

Jan.  20,1953 

July  31, 1955 

Jan.  31,19.56 

Jan.  20, 1961 


Sept.  25, 1957 
Jan.    20,1961 


Oct. 

Nov. 
Mar. 
Mar. 

Jan. 

July 

June 

Nov. 

May 


9, 1849 
15, 1850 
13. 18.53 
12, 1857 

16, 1861 

11, 1865 

15, 1865 

30, 1867 

4, 1875 


May  31,1868 
Mar.  17,1873 

June  11,1874 

Apr.     3, 1877 

June  30,1876 
Mar.    9, 1885 


Dec.  8, 1877 
Mar.  31, 1880 
Dec.  31,1881 

Apr.  16,1884 
Nov.  10, 1885 


Apr.  1, 1887 
June  30, 1886 
Mar.  12,1889 


Under  Secretaries ' 

S.  Parker  Gilbert,  Jr.,  New  Jersey- 
Garrard  B.  Winston,  Illinois 

Ogden  L.  Mills,  New  York  ^ 

Arthur  A.  Ballantine,  New  York. 

Dean  Q.  Acheson,  Maryland 

Henry    Morgenthau,   Jr.,    New 

York." 
Thomas  .Tefferson  Coolidge,  Mas- 
sachusetts. 

Roswell  Magill,  New  York 

John  W.  Hanes,  North  Carolina- 
Daniel  W.  Bell,  Illinois 

O.  Max  Gardner,  North  Carolina. 
A.  L.  M.  Wiggins,  South  Caro- 
lina. 
Edward  H.  Foley,  New  York... 

Marion  B.  Folsom,  New  York 

H.  Chapman  Rose,  Ohio 

Fred  C.  Scribner,  Jr.,  Maine 

Under  Secretary  for 
Monetary  Affairs  'o 

W.  Randolph  Burgess,  Maryland. 

Julian  B.  Baird,  Minnesota 

Assistant  Secretaries  " 

Charles  B.  Penrose,  Pennsylvania 

Allen  A.  Hall,  Pennsylvania 

William  L.  Hodge,  Tennessee 

Peter  Q.  Washington,  District  of 

Columbia. 
Philip  Clayton,  Georgia — . 


George  Harrington,  District  of 

Columbia.'!! 
Maunsell  B.  Field,  New  York- 


William     E.     Chandler, 

Hampshire. 
John  F.  Hartley,  Maine- 


New 


Edmund  Cooper,  Tennessee 

William  A.  Richardson,  Massa- 
chusetts. 
Frederick    A.    Sawyer,    South 

Carolina. 
Charles  F.  Conant,  New  Hamp- 
shire. 

Curtis  F.  Burnam,  Kentucky 

Henry  F.  French,  Massachusetts, 


Richard  C.  McCormick,  Arizona. 

John  B.  Hawley,  Illinois 

J.  Kcndrick  Upton,  New  Hamp- 
shire. 

John  C.  New,  Indiana 

Charles  E.  Coon,  New  York 

Charles  S.  Falrchild,  New  York" 

William  E.  Smith,  New  York 

Hugh  S.  Thompson,  South  Caro- 
lina. 


Mellon 

Mellon 

Mellon 

Mills,  Woodin... 

Woodin 

Woodin 

Morgenthau 

Morgenthau 

Morgenthau 

Morgenthau,  Vin- 
son. 
Vinson,  Snyder.. 
Snyder— 

Snyder 

Humphrey 

Humphrey 

Anderson 


Humphrey,    An- 
derson. 
Anderson 


Meredith 

Meredity,  Corwin. 
Corwin,  Guthrie.. 
Guthrie,  Cobb 

Cobb,  Thomas, 
Dix. 

Chase,  Fessenden, 
McCulloch. 

Chase,  Fes.senden, 
McCulloch. 

Fessenden,  Mc- 
Culloch. 

McCulloch,  Bout- 
well,  Richard- 
son, Bristow. 

McCulloch 

Boutwell 


Richardson,  Bris- 
tow. 

Bristow,  Morrill, 
Sherman. 

Bristow 

Morrill,  Sherman, 
Windom,  Fol- 
ger,  Gresham, 
McCulloch, 
Manning. 

Sherman 

Sherman 

Sherman,  Win- 
dom, Folger. 

Folgcr 

Folger,  Gresham 
McCulloch, 
Miuining. 

Manning 

Manning 

Manning,  Fair 
child,  Windom 


Harding,  Coolidge. 
Coolidge. 
Coolidge,  Hoover. 
Hoover,  Roosevelt. 
Roosevelt. 
Roosevelt. 

Roosevelt. 

Roosevelt. 
Roosevelt. 
Roosevelt,  Truman. 

Truman. 
Truman. 

Truman. 
Eisenhower. 
Eisenhower. 
Eisenhower. 


Eisenhower. 
Eisenhower. 

Taylor. 

Taylor,  Fillmore. 
Fillmore,  Pierce. 
Pierce,  Buchanan. 

Buchanan. 

Lincoln,  Johnson. 

Lincoln,  Johnson. 

Lincoln,  Johnson. 

Johnson,  Grant. 

Johnson. 
Grant. 

Grant. 

Grant,  Hayes. 

Grant. 

Grant,    Hayes, 

Garfield,  Arthur, 

Cleveland. 


Hayes. 
Hayes. 
Hayes,      Garfield, 

Arthur. 
Arthur. 
.\rthur,  Cleveland. 


Cleveland. 
Cleveland. 
Cleveland,    Harri- 
son. 


Footnotes  at  end  of  table. 


EXHIBITS 


391 


Exhibit  32. — Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the 
Treasury  Department  from  September  11,  1789,  to  January  20,  1961,  and  the 
Presidents  under  whom  they  served — Continued 


Term  of  service 


Apr.     6, 1887 


Apr. 
Apr. 

July  22, 

July  23, 

Apr.  27, 

Nov.  22, 

Dec.  23, 


Apr. 

Apr. 

July 

Apr. 
Apr. 

June 
Mar. 

Mar. 

Mar. 
May 
Mar. 

July 
Jan. 
Apr. 
Mar. 


Apr.  5, 
Apr.  19, 
Nov.  27 

June  8 
Apr.  4 
July  20, 

Mar.  24 
Aug.    1 

Oct.  1 
Mar.  24 
Aug.  1 
Apr.  17 
June  22 
Oct.     5, 


Oct.    30; 

Dec.  15, 
Sept.    4, 

Mar.  5 
Nov.  21 
June  15, 
July     6, 

Dec. 
Dec.    4, 

Mar.  16 

4, 


1889 
1889 

1890 
1890 

1891 
1892 
1892 

1893 

1893 

1893 

1897 
1897 

1897 
1899 

1901 

1903 
1903 
1905 

1906 
1907 
1907 


1909 
1909 
1909 

1910 
1911 
1912 

1913 
1913 

1913 
1914 
1914 
1917 
1917 
1917 


1917 

1917 
1918 

1919 
1919 
1920 
1920 

1920 
1920 

1921 
1921 


Mar.  11,] 


July 
Oct. 

Dec. 
June 

Oct. 
Mar. 
Apr. 

Apr. 

Mar. 

May 

Mar. 
Mar. 

Mar. 
June 


20, 


Apr.  15, 

Mar.  5, 
Jan.  21 
Nov.    1 

Mar.  15, 
Feb.  28, 
Mar.  6, 
Apr.  10, 

June  8, 
Apr.  3, 
July  31 

July  3, 
Mar.  a 
Sept.  30, 

Feb. 
Aug. 

Sept.  30 
Jan.  26, 
Mar.  15 
Aug.  28 
Nov.  20 
Aug.  26, 


July     5, 

Jan.  31 
June  30, 

Nov.  15 
June  14, 
Apr.  14, 
June  30, 

May  31 
Mar.    4, 

Mar.  31 
July     9 


1890 
1890 

1892 
1893 

1892 
1893 
1893 

1897 

1897 

1897 

1899 
1903 

1901 
1906 


1905 
1907 


1908 
1907 
1909 
1909 

1910 
1911 
1913 

1912 
1913 
1913 

1914 
1914 

1917 
1917 
1917 
1918 
1919 
1921 


1920 

1919 
1920 

1920 

1920 

1921 

>,  1921 

1921 
1921 

1925 
1923 


May 

Footnotes  at  end  of  table. 


Official 


Assistant  Secretaries  "—Continued 

Isaac  N.  Maynard,  New  York 

George  H.  Tichner,  Illinois 

George     T.     Batchelder,     New 
York." 

A.  B.  Nettleton,  Minnesota 

Oliver  L.  Spaulding,  Michigan... 

Lorenzo  Crounse,  Nebraska _ 

John  H.  Gear,  Iowa 

Genlo  M.  Lambertson,  Nebraska- 
Charles  S.  Hamlin,  Massachu- 
setts. 
William  E.  Curtis,  New  York 

Scott  Wike,  Illinois 

William  B.  Howell,  New  Jersey.. 
Oliver  L.  Spaulding,  Michigan... 

Frank  A.  Vanderlip,  Illinois 

Horace  A.  Taylor,  Wisconsin 

Milton  E.  Ailes,  Ohio. 

Robert  B.  Armstrong,  Iowa 

Charles  H.  Keep,  New  York 

Janips  B.  Reynolds,  Massachu- 
setts. 

John  II.  Edwards,  Ohio 

Arthur  F.  Statter,  Oregon 

Beekman  Winthrop,  New  York.. 
Louis   A.    Coolidge,    Massachu- 
setts. 

Charles  D.  Norton,  Illinois 

Charles  D.  Hilles,  New  York 

James  F.  Curtis,  Massachusetts. _ 

A.  Piatt  Andrew,  Massachusetts- 
Robert  0.  Bailey,  Illinois 

Sherman  P.  Allen,  Vermont 

John  Skelton  Williams,  Virginia. _ 
Charles  S.  Hamlin,  Massachu- 
setts. 
Byron  R.  Newton,  New  York... 
William  P.  Malburn,  Colorado.. . 
Andrew  J.  Peters,  Mnssachusetts. 

Oscar  T.  Crosby,  Virginia.. _ 

Leo  S.  Rowe,  Pennsylvania 

James  H.  Moyle,  Utah 


Russell    C.    Leffingwell,    New 
York.  15 

Thomas  B.  Love,  Texas 

Albert  Rathbonc,  New  York 


Jouett  Shouse,  Kansas 

Norman  H.  Davis,  Tennessee 

Nicholas  ICelley,  New  York 

S.  Parker  Gilbert,  Jr.,  New  Jer- 
sey." 

Ewing  Laporte,  Missouri 

Angus  W.  McLean,  North  Caro- 
lina. 
Eliot  Wadsworth,  Ma.ssachusetts. 
Edward  Clifford,  Illinois 


Served  Under- 


Secretary  of  the 
Treasury 


Fairchild,     Win- 
dom. 

Windom.. 

Windom.. 


Windom,  Foster.. 
Windom,   Foster, 
Carlisle. 

Foster 

Foster 

Foster,  Carlisle- 
Carlisle,  Gage 

Carlisle,  Gage 

Carlisle,  Gage 

Gage 

Gage,  Shaw 

Gage 

Gage,  Shaw - 

Gage,  Shaw 

Shaw 

Shaw 

Shaw,  Cortclyou, 

MaeVeagh. 
Shaw,  Cortelyou. 

Shaw 

Cortelyou 

Cortelyou,    Mae- 
Veagh. 

MaeVeagh 

MaeVeagh 

MaeVeagh,  Mc- 
Adoo. 

MaeVeagh. 

MaeVeagh 

MaeVeagh,  Mc- 
Adoo. 

McAdoo 

McAdoo. 

McAdoo 

McAdoo 

McAdoo 

McAdoo 

McAdoo,  Glass.. 

McAdoo,  Glass, 
Houston,  Mel- 
lon. 

McAdoo,  Glass, 
Houston. 

McAdoo,  Glass.. 

McAdoo,  Glass, 
Houston. 

Glass,  Houston... 

Glass,  Houston... 

Houston,  Mellon. 

Houston,  Mellon. 

Houston,  Mellon. 
Houston 

Mellon 

Mellon 


President 


Cleveland, 

son. 
Harrison. 
Harrison. 

Harrison. 
Harrison, 

land. 
Harrison. 
Harrison. 
Harrison, 

land. 
Cleveland, 

Kinley. 
Cleveland, 

Kinley. 
Cleveland, 

Kinley. 
McKinley. 
McKinley, 

vclt. 
McKinley. 
McKinley, 

velt. 
McKinley, 

velt. 
Roosevelt. 
Roosevelt. 
Roosevelt, 


Harri- 


Cleve- 

Cleve- 
Mc- 
Mc- 
Mc- 

Roose- 

Roose- 
Roose- 

Taft. 


Roosevelt. 
Roosevelt. 
Roosevelt. 
Roosevelt,  Taft. 

Taft. 
Taft. 
Taft,  Wilson. 

Taft. 
Taft. 
Taft,  Wilson. 

Wilson. 
Wilson. 

Wilson. 
Wilson. 
Wilson. 
Wilson. 
Wilson. 
Wilson,  Harding. 


Wilson. 

Wilson. 

Wilson. 

Wilson. 
Wilson. 

Wilson,  Harding. 
Wilson,  Harding. 

Wilson,  Harding. 
Wilson. 

Harding,  Coolidge. 
Harding. 


392 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Exhibit  32. — Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the 
Treasury  Department  from  September  11,  1789,  to  January  20,  1961,  and  the 
Presidents  under  whom  they  served — Continued 


Term  of  service 

Official 

Served  Under- 

From— • 

To— 

Secretary  of  the 
Treasury 

President 

Dec.  23, 1921 

Julv    25,  1922 
June   13.1926 
Nov.  19,1923 
Nov.    5,  1927 
July    31.  1927 
June   2.5, 1929 
Mar.  15,1933 
Sept.    1,1929 

Apr.    17.1933 
.Mar.  15  1931 
Feb.    12,1932 
.Tune  11,1933 
Feb.   15,1936 

Sept.  30, 1939 

Dec.   12,1933 
Nov.    1, 1937 
Feb.   28,1939 
Oct.    31. 1938 
Dec.     2, 1945 

Nov.  .30, 1944 
May    1, 1946 

July   14,1948 
Jan.    20, 1953 
Mar.  31, 1951 

Feb.  28,1957 

Aug.     2, 1955 
Jan.    20,1961 

Dec.   15,1957 

Aug.    8,1957 

Dec.   15,1958 

'Decri8,l960' 
Jan.   20,1961 

June  17,1955 

Assistant  Secretaries  n— Continued 

El^rer  Dover,  Washington 

McKenzie  Mo.ss,  Kentucky 

Garrard  B.  Winston,  Illinois  i'... 
Charles  S.  Dewev,  Illinois 

Mellon 

Harding. 

Mar.    3, 1923 

Mellon 

Harding,  Coolidge. 
Harding,  Coolidge. 
Coolidge. 
Coolidge. 

July     9, 1923 

Mellon . 

July     1, 1924 
Apr.     1, 1925 
Dec.  28, 1926 

Mellon 

Lincoln  C.  Andrews,  New  York__ 
Carl  T.  Schuneman,  Minnesota. _ 
Seymour  I,ovvman,  New  York... 
Henry  Herrick  Bond,  Massachu- 
setts. 

Ferry  K.  Heath,  Michigan 

Walter  Ewing  Hope,  New  York_. 
Arthur  .\.  Ballantine,  New  York". 
James  11.  Douglas,  Jr.,  Illinois... 
Lawrence  W.  Robert,  Jr.,  Georgia. 

Stephen  B.  Gibbons,  New  York.. 

Thomas  Hewes,  Connecticut 

Josephine  Roche,  Colorado 

Wa^Tie  C.  Taylor,  Rlinois 

John  W.  Haties,  North  Carolina". 
Herbert  E.  Gaston,  New  York... 

John  L.  Sullivan,  New  Hampshire 
Harry  D.  White,  Maryland 

Edward  H.  Foley,  New  York  20.. 
John  S.  Graham,  North  Carolina. 
William  McChesney  Martin,  Jr., 

New  York. 
Andrew  N.  Overby,  District  of 

Columbia. 

H.  Chapman  Rose,  Ohio  21 

Laurence  B.  Robbins,  Illinois  22.. 

David  W.  Kendall,  Michigan 

Fred  C.  Scribner,  Jr.,  Maine  23... 

Tom  B.  Coughran,  California 

A.  Gilniore  Flues,  Ohio 

T.  Graydon  Upton,  Pennsylvania 
John  P.  Weitzel,  Rhode  Island... 

Fiscal  Assistant  Secretaries^* 

Edward  F.  Bartelt,  Illinois 

William  T.  Heffelfinger,  District 
of  Columbia. 

Administrative  Assistant  Secretaries-^ 

William  W.  Parsons,  California.  _ 

A.  E.  Weatherbee,  Maine 

Mellon 

Mellon 

Coolidge,  Hoover. 

Aug.     1, 1927 

Mellon 

Nov.    7. 1927 

MeUon 

Coolidge,  Hoover. 

June  26,1929 

Mellon 

Hoover. 

Nov.  21, 1929 

Mellon.    .  . 

Hoover. 

Mar.  16, 1931 

.Mellon 

Mar.    9  1932 

Mills 

Hoover. 

Apr.   18,1933 
June    6, 1933 
June  12, 1933 

Woodin,  Morgen- 
thau. 

Woodin,  Morgen- 
thau. 

Roosevelt. 
Roosevelt. 
Roosevelt. 

Dec.     1, 1934 
Feb.   19.19.36 
July     1  1938 
June  23,1939 

Jan.    18,1940 
Jan.    24,1945 

Apr.   15,1946 
Julv    16, 1948 

Morgenthau 

Morgenthau 

Morgenthau 

Morgenthau,  Vin- 
son. 

Morgenthau 

Morgenthau,  Vin- 
son. 
Vinson,  Snyder... 
Snyder  ...  . 

Roosevelt. 
Roosevelt. 
Roosevelt. 
Roosevelt, 

Truman. 
Roosevelt. 
Roosevelt, 

Truman. 
Truman. 
Truman. 

Feb.     8, 1949 

Snyder 

Truman. 

Jan.    24,1952 

Jan.    28,  1953 
Sept.  20, 1954 

Aug.    3, 1955 

Apr.   18,1957 

Dec.     4, 1957 

Snyder,  Humph- 
rey. 

Humphrey 

Humphrey, 
Anderson. 

Humphrey, 
Anderson. 

Humjihrey, 
Anderson. 

Anderson . 

Truman, 
Eisenhower. 
Eisenhower. 
Eisenhower. 

Eisenhower. 

Eisenhower. 

Eisenhower. 

Dee.  16,1957 

Anderson 

Eisenhower. 

Dec.   17, 1958 

Anderson.  . 

Eisenhower. 

Dec.  20,1960 

Anderson 

Eisenhower. 

Mar.  16, 1945 
June  19, 1955 

Morgenthau,  Vin- 
son, Snyder, 
Humphrey. 

Humphrey, 
Anderson. 

Snyder,  Humph- 
rey, Anderson. 
Anderson       ..     .. 

Roosevelt, 
Truman, 
Eisenhower. 
Eisenhower. 

Aug.    2, 1950 
Sept.  14,1959 

Aug.  31, 1959 

Truman, 

Eisenhower. 
Eisenhower. 

'  While  holding  the  office  of  Secretary  of  the  Treasury,  Gallatin  was  commissioned  envoy  extraordinary 
and  minister  plenipotentiary  Apr.  17,  1813,  with  John  Quincy  Adams  and  James  A.  Bayard,  to  negotiate 
peace  with  Great  Britain.  On  Feb.  9,  1814,  his  seat  as  Secretary  of  the  Trea.sury  was  declared  vacant 
because  of  his  absence  in  Europe.  William  Jones,  of  Pennsylvania  (Secretary  of  the  Navy),  acted  ad 
interim  Secretary  of  the  Treasury  from  Apr.  21,  1813,  to  Feb.  9,  1814. 

2  Rush  was  nominated  Mar.  5,  1825,  confirmed  and  commissioned  Mar.  7,  1825,  but  did  not  enter  upon 
the  discharge  of  his  duties  until  Aug.  1,  1825.  Samuel  L.  Southard,  of  New  Jersey  (Secretary  of  the  Navy), 
served  as  ad  interim  Secretary  of  the  Treasury  from  Mar.  7  to  July  31,  1825. 

'  Asbury  Dickens  (chief  clerk),  ad  interim  Secretary  of  the  Treasury  from  June  21  to  Aug.  7,  1831. 


EXHIBITS  393 


«  Spencer  resigned  as  Secretary  of  the  Treasury  May  2,  1844;  McClintock  Young  (chief  clerk),  ad  interim 
Secretary  of  the  Treasury  from  May  2  to  July  3,  1844. 

6  Hugh  McCulloch  was  Secretary  from  Mar.  9,  1865,  to  Mar.  3,  1869,  and  also  from  Oct.  31,  1884,  to  Mar. 
7,  1885. 

6  William  Windom  was  Secretary  from  Mar.  8, 1881,  to  Nov.  13,  1881,  and  also  from  Mar.  7,  1889,  to  Jan. 
29,  1891. 

7  Office  established  by  act  of  June  16,  1921;  appointed  by  the  President. 

8  Became  Secretary  Feb.  13,  1932. 
»  Became  Secretary  Jan.  1,  1934. 

'»  Office  e.stablished  by  act  of  July  22,  1954;  appointed  by  the  President. 

"  Office  established  by  act  of  Mar.  3,  1849;  appointed  by  the  Secretary.  Act  of  Mar.  3,  1857,  made  the 
office  presidential. 

'2  Act  of  Mar.  14,  1864,  provided  for  an  additional  Assistant  Secretary. 

13  Became  Secretary  April  1,  1887. 

1*  Act  of  July  11,  1890,  provided  for  an  additional  Assistant  Secretary. 

'5  Act  of  Oct.  6, 1917,  provided  for  two  additional  Assistant  Secretaries  for  duration  of  war  and  six  months 
after. 

■6  Became  Under  Secretary  July  1,  1921. 

"  Became  Under  Secretary  Nov.  20,  1923. 

18  Became  Under  Secretary  Feb.  13,  1932. 

'9  Became  Under  Secretary  Nov.  1,  1938. 

20  Became  Under  Secretary  July  15,  1948. 

21  Became  Under  Secretary  Aug.  3,  1955. 

22  Act  of  July  22,  1954,  provided  for  an  additional  Assistant  Secretary. 

23  Became  Under  Secretary  Aug.  9,  1957. 

24  Office  established  by  Reorganization  Plan  No.  3  of  1940. 

25  Office  established  by  Reorganization  Plan  No.  26  of  1950. 

Note. — Robert  Morris,  the  first  financial  officer  of  the  Government,  was  Superintendent  of  Finance 
from  1781  to  1784.  Upon  the  resignation  of  Morris,  the  powers  conferred  upon  him  were  transferred  to 
the  "Board  of  the  Treasury."  Those  who  finally  accepted  positions  on  this  board  were  John  Lewis 
Gervais,  Samuel  Osgood,  and  Walter  Livingston.  The  board  served  until  Hamilton  assumed  office  in 
1789. 


Exhibit  33. — Treasury  Department  orders  relating  to  organization  and  procedure 

No.   148,  Revision  No.  8,  December  1,   1960. — Supervision  of  Bureaus  of 
THE  Treasury  Department 

The  following  assignments  of  bureaus  of  the  Treasury  Department  are  hereby 
ordered : 

Under  Secretary  (Mr.  Fred  C.  Scribner,  Jr.) : 
Internal  Revenue  Service. 
Bureau  of  Engraving  and  Printing. 
Administrative  Assistant  Secretary  (Mr.  A.  E.  Weatherbee) : 

Management  Analysis  Staff. 

Office  of  Administrative  Services. 

Office  of  Budget. 

Office  of  Personnel. 
Assistant  to  the  Secretary  (Mr.  Nils  A.  Lennartson) : 

Office  of  Information. 
Assistant  to  the  Secretary  (Mr.  Francis  J.  Gafford) : 

Office  of  Personnel  Securit3^ 
Tax  Analysis  Staff. 
International  Tax  Staff. 
Under  Secretary  for  Monetary  Affairs  (Mr.  Julian  B.  Baird) : 
Fiscal  Assistant  Secretary  (Mr.  William  T.  Heffelfinger) : 

Bureau  of  Accounts. 

Bureau  of  the  Public  Debt. 

Office  of  the  Treasurer  of  the  United  States. 
United  States  Savings  Bonds  Division. 
Assistant  to  the  Secretary  (Mr.  J.  Dewey  Daane). 
Assistant  to  the  Secretary  (Mr.  Charls  E.  Walker). 
Special  Assistant  to  the  Secretary  (Mr.  Frank  A.  Southard,  Jr.). 
Debt  Analysis  Staff. 
Assistant  Secretary  (Mr.  Laurence  B.  Robbins) : 
Office  of  Defense  Lending. 
Bureau  of  the  Mint. 
Office  of  the  Comptroller  of  the  Curx-ency. 


394   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Assistant  Secretary  (Mr.  A.  Gilmore  Flues): 
United  States  Coast  Guard. 
United  States  Secret  Service. 
Bureau  of  Customs. 
Bureau  of  Narcotics. 

Assistant  to  the  Secretary  for  Law  Enforcement  (Vacancy), 
Assistant  Secretary  (Mr.  T.  Graydon  Upton): 

Assistant  to  tiie  Secretary  (Mr.  Alfred  H.  Von  Klemperer) : 

Office  of  International  Finance  (including  Foreign  Assets  Control). 
General  Counsel  (Mr.  David  A.  Lindsay): 

Assistant  to  the  Secretary  and  Head,  Legal  Advisory  StafT  (Mr.  Jay  W. 
Glasmann). 
Deputy  to  the  Secretary  (Mr.  John  P.  Weitzel). 

Robert  B.  Anderson, 
Secretary  of  the  Treasury. 

No.  148,  Revision  No.  10,  March  2,  1961 — Supervision  of  Bureaus  of  the 

Treasury  Department 

1.  The  following  assignments  of  bureaus  and  offices  of  the  Treasury  Department 
are  hereby  ordered,  effective  immediately  or  upon  the  date  of  oath  where  any 
official  has  yet  to  be  confirmed  by  the  Senate. 

Under  Secretary  for  Monetary  Affairs  (Mr.  Robert  V.  Roosa) : 

Assistant  to  the  Secretary  (Mr.  J.  Dewey  Daane): 
Office  of  Debt  Analysis. 

Office  of  the  Comptroller  of  the  Currency. 

United  States  Savings  Bonds  Division. 
Assistant  Secretary  (Mr.  A.  Gilmore  Flues): 

Bureau  of  Customs. 

Bureau  of  Engraving  and  Printing. 

Bureau  of  the  Mint. 

Bureau  of  Narcotics. 

Office  of  Law  Enforcement  Coordination, 

United  States  Coast  Guard. 

United  States  Secret  Service. 
Assistant  Secretary  (Mr.  John  M.  Leddy) : 

Office  of  International  Finance. 
Assistant  Secretary  (Mr.  Stanley  S.  Surrey): 

Office  of  Tax  Analysis. 

Office  of  Tax  Legislative  Counsel. 

Office  of  International  Tax  Affairs. 
General  Counsel  (Mr.  Robert  H.  Knight): 

Office  of  Legal  Services. 
Fiscal  Assistant  Secretary  (Mr.  William  T,  Heffelfinger) : 

Bureau  of  Accounts. 

Bureau  of  the  Public  Debt. 

Office  of  the  Treasurer  of  the  United  States. 

Office  of  Defense  Lending. 
Administrative  Assistant  Secretary  (Mr.  A.  E.  Weatherbee) : 

Office  of  Administrative  Services, 

Office  of  Budget. 

Office  of  Management  and  Organization. 

Office  of  Personnel. 

Office  of  Security. 

2.  In  addition  to  the  above  assignments,  the  following  bureaus,  offices,  staffs, 
and  staff  assistants  shall  be  under  the  direct  supervision  of  the  Secretary  and  the 
Under  Secretary: 

Internal  Revenue  Service  (Mr.  Mortimer  M.  Caplin). 
Assistant  to  the  Secretary  (Congressional  Relations) 

(Mr.  Joseph  W.  Barr). 
Assistant  to  the  Secretary  (Public  Relations) 

(Mr,  Dixon  Donnelley), 


EXHIBITS  395 

Special  Assistant  to  the  Secretary  (Mr.  Robert  A.  Wallace). 
Special  Assistant  to  the  Secretary  (Mr.  Frank  A.  Southard,  Jr.). 
Special  Assistant  to  the  Secretary  (Mr.  Robert  Cutler). 
Director,  Executive  Secretariat  (Mr.  Thomas  W.  Wolfe). 

3.  The  Under  Secretary  shall  have  general  supervision  over  all  the  functions  of 
the  Department  and  will  act  as  Secretary  of  the  Treasury  in  the  absence,  un- 
availability, or  sickness  of  the  Secretary.  In  case  of  the  absence  of  the  Secretary 
and  the  Under  Secretary,  the  following  will  act  as  Secretary  of  the  Treasury  in 
the  order  indicated: 

The  Under  Secretary  for  Monetary  Affairs. 
The  senior  Assistant  Secretary  present. 
The  General  Counsel. 

4.  This  order  supersedes  Treasury  Department  Order  No.  148  (Revision  No. 
9),  dated  January  23,  19G1,  and  all  other  orders  and  circulars  previously  issued 
with  reference  to  the  supervision  of  bureaus  and  offices  of  the  Treasury  De- 
partment. 

Douglas  Dillon, 
Secretary  of  the    Treasury. 


No.    150-53,    December    7,    1960. — Establishment    of    Internal    Revenue 

District,  Anchorage 

By  virtue  of  the  authority  vested  in  me  as  Secretary  of  the  Treasury  by  Re- 
organization Plan  No.  26  of  1950,  Reorganization  Plan  No.  1  of  1952,  section 
7621  of  the  Internal  Revenue  Code  of  1954,  as  amended,  and  Executive  Order 
10289,  approved  September  17,  1951,  made  applicable  to  the  Internal  Revenue 
Code  of  1954  by  Executive  Order  10574,  approved  November  5,  1954,  it  is  hereby 
ordered: 

1.  Area  comprising  Alaska  removed  from  Internal  Revenue  District,  Seattle. — 
The  area  comprising  the  State  of  Alaska  is  removed  from  the  Internal  Revenue 
District,  Seattle. 

2.  Establishment  of  Internal  Revenue  District  and  Office  of  District  Director. — An 
internal  revenue  district  to  be  known  as  Internal  Revenue  District,  Anchorage, 
which  shall  include  the  area  comprising  the  State  of  Alaska,  and  an  office  of  District 
Director,  Anchorage,  are  established  in  the  San  Francisco  region  for  all  purposes 
authorized  by  the  internal  revenue  laws  of  the  United  States. 

3.  Effective  date. — This  order  shall  be  effective  January  1,  1961. 

Fred  C.  Scribner,  Jr. 
Acting  Secretary  of  the  Treasury. 


No.  150-55,  January  19,  1961. — Delegation  of  Functions  to  the  Secretary 

OF  the  Interior 

By  virtue  of  the  authority  vested  in  me  as  Secretary  of  the  Treasury,  there  are 
hereby  delegated  to  the  Secretary  of  the  Interior,  to  be  performed  through  the 
Governors  of  Guam  and  American  Samoa,  or  their  subordinates,  the  functions  of 
the  Internal  Revenue  Service  in  the  administration,  collection,  and  enforcement  in 
Guam  and  American  Samoa  of  the  taxes  imposed  by  chapters  2  and  21  of  the 
Internal  Revenue  Code  of  1954. 

The  authority  delegated  herein  shall  be  carried  out  generally  in  conformity 
with  the  pohcies,  procedures,  and  instructions  established  for  the  Internal  Revenue 
Service. 

The  Internal  Revenue  Service  shall  furnish  the  Governors  of  Guam  and  Amer- 
ican Samoa  or  their  subordinates  with  pertinent  Treasury  Department  issuances, 
render  interpretations  of  the  applicable  tax  laws  and  regulations,  and  provide 
guidance  and  assistance  in  carrying  out  the  functions  delegated  herein. 

Robert  B.  Anderson, 
Secretary    of   the    Treasury. 


614359—62 26 


396        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 

No.   167-44,    October   18,    1960. — Delegation   of   Functions  to   the   Com- 
mandant, U.S.  Coast  Guard 

By  virtue  of  the  authority  vested  in  me  by  Reorganization  Plan  No.  26  of  1950 
and  by  14  U.S.C.  631,  there  are  transferred  to  the  Commandant,  U.S.  Coast 
Guard,  the  functions  of  the  Secretary  of  the  Treasury  under  Public  Law  86-555, 
the  Great  Lakes  Pilotage  Act  of  1960  (74  Stat.  259-262). 

The  Commandant  may  make  provision  for  the  performance  by  subordinates  in 
the  Coast  Guard  of  the  functions  delegated  herein. 

A.  Gilmore  Flues, 
Acting  Secretary  of  the  Treasury. 

No.  168-2,  January  23,  1961. — Authorization  to  Continue  the  Sale  op 
Certain  U.S.  Securities  Bearing  the  Facsimile  Signature  of  the  Former 
Secretary  of  the  Treasury 

Pursuant  to  the  provisions  of  R.S.,  Sec.  161,  5  U.S.C.  22,  as  amended,  it  is 
hereby  ordered: 

That  the  sale  and  issue  of  United  States  savings  bonds  of  Series  E  and  H,  pur- 
suant to  Department  Circulars  Nos.  653,  Fifth  Revision,  and  905,  Second  Revi- 
sion, continue  and  that  the  existing  stocks  be  used  notwithstanding  the  tact  that 
the  bonds  of  such  stocks  bear  the  facsimile  signature  of  the  former  Secretary  of  the 
Treasury.  All  savings  bonds  issued  or  reissued  pursuant  to  said  Department 
circulars  or  applicable  regulations  by  the  Treasury,  directly  or  through  authorized 
issuing  agents,  shall  be  valid  and  binding  obligations  notwithstanding  the  fact 
that  they  bear  the  facsimile  signature  of  the  former  Secretary.  The  term  "existing 
stocks"  as  used  herein  means  stocks  of  bonds  of  Series  E  and  H  now  on  order,  as 
well  as  stocks  thereof  presently  on  hand  in  the  Treasury  Department  and  at  its 
issuing  agencies,  including  the  Federal  Reserve  Banks  and  branches. 

This  order  shall  be  effective  immediately. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 

No.  170-6,  January  23,  1961. — Establishment  of  an  Executive  Secretariat 

There  is  hereby  established  in  the  Office  ot  the  Secretary  an  Executive  Secre- 
tariat. The  Executive  Secretariat  will  be  the  central  coordinating  staff  of  the 
Department  serving  the  Secretary  and  the  Under  Secretary.  Its  purpose  is  to 
screen  and  check  all  matters  submitted  to  them  for  completeness  and  conformity 
with  established  standards  of  presentation,  and  to  insure  responsiveness  in  all 
departmental  units  to  the  wishes  of  the  Secretary  and  the  Under  Secretary. 

In  carrying  out  this  responsibility,  the  Director  of  the  Executive  Secretariat 
will,  among  other  duties: 

(a)  Review  all  material  submitted  by  departmental  units  for  the  attention  of 
the  Secretary  and  Under  Secretary  to  insure  completeness  and  proper  coordina- 
tion; 

(6)  Review  for  assignment  of  action  all  incoming  official  correspondence  for 
the  Secretary  and  Under  Secretary; 

(c)  Attend  key  meetings  with  the  Secretary  and  Under  Secretary  to  assure 
completeness  of  action  assignments  made; 

(d)  Assure  proper  oral  and/or  written  briefing  of  the  Secretary  and  Under 
Secretary  for  their  appointments  with  the  President,  meetings  of  the  Cabinet, 
NSC  and  similar  engagements,  and  for  official  visitors  caUing  upon  them;  and 

(e)  Maintain  direct  liaison  with  the  White  House  Staff  Secretary  as  the 
principal  Department  channel  to  the  White  House. 

All  action  papers,  correspondence,  staff  studies  and  memoranda,  and  similar 
material  submitted  by  departmental  units  for  the  attention  of  the  Secretary  and 
Under  Secretary  will  be  routed  through  the  Executive  Secretariat  for  review  and 
approval. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


EXHIBITS  397 

No.  170-7,   February  23,   1961. — Establishment  of  an  Office  of  Congres- 
sional Relations 

There  has  been  established  within  the  Office  of  the  Secretary  an  Office  of 
Congressional  Relations.  This  office  will  coordinate  congressional  relations 
activities  throughout  the  Department.  In  carrying  out  this  responsibility,  the 
Assistant  to  the  Secretary  for  Congressional  Relations  will,  among  other  duties: 

(a)  Service  congressional  mail,  inquiries,  requests,  etc.; 

(b)  Supervise  and  coordinate  the  Department's  legislative  program,  except 
appropriation  matters; 

(c)  Assist  the  Secretary  in  determining  feasible  legislative  policy;  and 

(d)  Act  as  a  conduit  for  the  continuous  exchange  of  information  between  the 
Congress  and  the  Department. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 

No.    177-14,   Revised,   September  26,   1960. — Delegation  of  Authority  to 
Make  Certain  Loans  to  the  District  of  Columbia 

By  virtue  of  the  authority  vested  in  me  by  Reorganization  Plan  No.  26  of  1950, 
there  is  hereby  transferred  to  the  Fiscal  Assistant  Secretary  of  the  Treasury  the 
function  of  making  loans  to  the  Board  of  Commissioners  of  the  District  of 
Columbia: 

(1)  Pursuant  to  the  act  of  June  2,  1950,  64  Stat.  195,  as  amended  by  the 
District  of  Columbia  Public  Works  Act  of  1954,  68  Stat.  101,  103,  for  the  expan- 
sion and  improvement  of  the  District  of  Columbia  water  system; 

(2)  Pursuant  to  the  District  of  Columbia  Public  Works  Act  of  1954,  68  Stat. 
101,  108,  for  the  construction,  expansion,  relocation,  replacement,  or  renovation 
of  the  sanitary  sewer  system  of  the  District  or  the  combined  sewer  system  of  the 
District; 

(3)  Pursuant  to  the  District  of  Columbia  Public  Works  Act  of  1954,  68  Stat. 
101,  110,  for  financing  highway  construction; 

(4)  Pursuant  to  the  act  of  June  12,  1960,  Public  Law  86-515,  74  Stat.  210, 
211,  for  the  planning,  construction,  operation,  and  maintenance  of  a  sanitary 
sewer  to  connect  the  Dulles  International  Airport  with  the  District  of  Columbia 
system;  and 

(5)  Pursuant  to  the  act  of  June  6,  1958,  72  Stat.  183,  to  assist  in  financing 
the  cost  of  constructing  facilities  required  for  activities  financed  by  the  general 
fund  of  the  District. 

All  of  the  foregoing  loans  shall  be  made  at  rates  of  interest  fixed  by  the  Secre- 
tary of  the  Treasury  in  accordance  with  the  applicable  statutory  provisions. 

Julian  B.  Baird, 

Acting  Secretary  of  the  Treasury. 


No.  180-5,  August  3,  1960. — Delegation  of  Functions  to  the  Commissioner 

OF  Narcotics 

By  virtue  of  the  authority  vested  in  me  by  Reorganization  Plan  No.  26  of  1950 
and  by  Public  Law  86-429,  there  is  hereby  delegated  to  the  Commissioner  of 
Narcotics  authority  to  perform  all  the  functions  of  the  Secretary  of  the  Treasury 
under  Public  Law  86-429,  74  Stat.  55,  cited  as  the  "Narcotics  Manufacturing  Act 
of  1960." 

The  functions  herein  transferred  to  the  Commissioner  of  Narcotics  may  be 
delegated  by  him  to  subordinates  as  he  deems  necessary. 

Regulations  issued  by  the  Commissioner  of  Karcotics  under  the  Narcotics 
Manufacturing  Act  of  1960  shall  be  subject  to  approval  by  the  Secretary  of  the 
Treasury. 

A.  GiLMORE  Flues, 
Acting  Secretary  of  the  Treasury. 


398        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 

No.  180-6,  March  30,  1961. — Authorization  for  the  Governor  of  the 
Canal  Zone  to  Administer  the  Laws  and  Regulations  Relating  to 
Narcotic  Drugs 

WHEREAS,  section  4735(b)  of  the  Internal  Revenue  Code  of  1954,  as  amended, 
provides  that — 

"The  President  is  authorized  and  directed  to  issue  such  Executive  orders  as 
will  carry  into  effect  in  the  Canal  Zone  the  intent  and  purpose  of  sections  4701 
to  4707,  inclusive,  and  sections  4721  to  4726,  inclusive,  of  the  Internal  Revenue 
Code  of  1954,  by  providing  for  the  registration  and  the  imposition  of  a  special 
tax  upon  all  persons  in  the  Canal  Zone  who  produce,  import,  compound,  deal  in, 
dispense,  sell,  distribute,  or  give  away  narcotic  drugs;" 
and 

WHEREAS,  the  President  by  Executive  Order  10583  of  December  18,   1954 
(3  CFR,  1954  Supp.  98),  delegated  to  the  Secretary  of  the  Treasury  his  powers 
under  section  4735(b)  of  the  Internal  Revenue  Code  of  1954,  as  amended; 
NOW,  THEREFORE,  by  virtue  of  this  authority  it  is  hereby  ordered  that: 

1.  The  heading  of  Part  16  of  Title  35  is  amended  to  read  as  set  forth  above,  and 
the  part  is  revised  to  read  as  follows.  These  sections  supersede  former  §§  16.1 
to  16.9. 

Subpart  A — Administration  of  Laws  and  Regulations  Relating  to  Narcotic  Drugs 

Sec. 

16.1  Authority  of  the  Governor  of  the  Canal  Zone. 

16.2  Issuance  of  regulations. 

16.3  Redelegation. 

16.4  Prohibited  acts. 

16.5  Registration  and  payment  of  tax. 

16.6  Issuance  of  order  forms. 

16.7  Penalties. 

Subpart  B — [Reserved] 

AUTHORITY:  §§  16.1  to  16.7  issued  under  68A  Stat.  559;  26  U.S.C.  4735(b). 
Subpart  A — Administration  of  Laws  and  Regulations  Relating  to  Narcotic  Drugs 

§  16.1     authority  op  the  governor  of  the  canal  zone 

The  Governor  of  the  Canal  Zone  shall  perform  in  the  Canal  Zone  all  of  the 
duties  required  to  be  performed  under  the  act  of  Congress  approved  December 
17,  1914,  entitled  "An  Act  To  provide  for  the  registration  of,  with  collectors  of 
internal  revenue,  and  to  impose  a  special  tax  upon  all  persons  who  produce,  import, 
manufacture,  compoimd,  deal  in,  dispense,  sell,  distribute,  or  give  away  opium 
or  coca  leaves,  their  salts,  derivatives,  or  preparations,  and  for  other  purposes," 
as  amended.  These  duties  shall  include  the  making  of  such  inspections  and  the 
taking  of  such  actions  as  may  be  necessary  to  enforce  the  provisions  of  the  act 
of  December  17,  1914,  as  amended,  and  ail  orders  and  regulations  issued  there- 
under, insofar  as  they  apply  to  activities  in  or  relating  to  the  Canal  Zone. 

§  16.2     ISSUANCE  of  regulations 

The  Governor  of  the  Canal  Zone  shall  prescribe  such  regulations  as  may  be 
necessary  to  carry  the  provisions  of  this  subpart  into  full  force  and  effect.  In 
doing  so  the  Governor  shall  follow  the  form  of  regulations  prescribed  by  the 
Commissioners  of  Narcotics  and  Internal  Revenue  and  approved  by  the  Secretary 
of  the  Treasury  (26  CFR  Part  151)  so  far  as  they  can  be  made  applicable  to 
conditions  in  the  Canal  Zone. 

§   16.3       REDELEGATION 

The  Governor  of  the  Canal  Zone  is  authorized  to  delegate  to  such  officers  or 
employees  of  the  Canal  Zone  as  he  may  deem  appropriate  any  of  his  functions 
under  this  subpart  when  he  deems  a  delegation  necessary  or  desirable  to  carry 
out  the  purposes  of  this  subpart. 


EXHIBITS  399 

§  16.4       PROHIBITED  ACTS 

No  person  shall  produce,  import,  manufacture,  compound,  deal  in,  dispense, 
sell,  distribute,  or  give  away  in  the  Canal  Zone  opium,  opiates,  or  coca  leaves, 
their  salts,  derivatives,  or  preparations  unless  he  shall  have  complied  with  the 
provisions  of  the  act  of  December  17,  1914,  as  amended,  and  all  relevant  orders 
and  regulations  issued  thereunder. 

§  16.5      REGISTRATION    AND    PAYMENT    OP   TAX 

Every  person  who  by  the  terms  of  the  act  of  December  17,  1914,  as  amended, 
would  be  required,  if  located  outside  of  the  Canal  Zone,  to  register  with  the 
director  of  internal  revenue  of  his  district,  his  name  or  style,  place  of  business  and 
place  or  places  where  such  business  is  to  be  carried  on,  shall  register  that  informa- 
tion with  the  Governor  of  the  Canal  Zone  or  his  delegate  on  forms  to  be  prescribed 
by  the  Governor.  At  the  time  of  sach  registry,  and  on  or  before  the  first  day  of 
July  annually  thereafter,  every  person  who  produces,  imports,  manufactures, 
compounds,  deals  in,  dispenses,  sells,  distributes,  or  gives  away  any  of  the  afore- 
said narcotic  drugs  shall  pay  to  the  Governor  of  the  Canal  Zone,  or  to  his  delegate, 
a  special  tax  at  the  rate  or  rates  specified  in  section  4721  of  the  Internal  Revenue 
Code  of  1954,  as  amended;  provided,  however,  that  any  person  who  would  not 
be  required,  if  located  outside  the  Canal  Zone,  to  register  or  pay  a  special  tax 
shall  not  be  required  to  register  or  pay  the  special  tax  as  provided  in  this  subpart. 

§  16.6       ISSUANCE    OF    ORDER    FORMS 

The  Governor  of  the  Canal  Zone  or  his  delegate  shall  cause  suitable  order  forms 
to  be  prepared  for  sale  to  persons  who  shall  have  registered  and  paid  the  special 
tax  as  required  by  the  act  of  December  17,  1914,  as  amended,  and  by  this  subpart. 
The  price  to  be  paid  for  such  order  forms  shall  be  $1  per  hundred.  The  Governor 
or  his  delegate  shall  be  subject  to  the  same  limitation  on  sales  of  order  forms  as 
directors  of  internal  revenue  in  districts  outside  of  the  Canal  Zone. 

§  16.7       PENALTIES 

Any  person  who  violates  or  fails  to  comply  with  any  of  the  requirements  of  the 
act  of  December  17,  1914,  as  amended,  or  of  any  applicable  order  thereunder  in 
the  Canal  Zone  shall  be  subject  to  the  penalties  provided  for  in  that  act,  as 
amended. 

Subpart  B — [Reserved] 

2.  To  the  extent  that  any  order,  regulation,  or  circular  heretofore  issued  may 
be  in  conflict  with  this  order  it  is  hereby  revoked. 

A.  GiLMORE  Flues, 
Acting  Secretary  of  the  Treasury. 


No.  183,  Revision  No.  2,  May  24,  1961. — Succession  Order  Among  Treasury 

Officials 

Pursuant  to  Executive  Order  10941,  dated  May  15,  1961,  in  the  case  of  the 
death,  resignation,  absence,  or  sickness  of  the  Secretary,  the  Under  Secretary, 
and  the  Under  Secretary  for  Monetary  Affairs,  the  following  officers  shall,  in  the 
order  of  succession  indicated,  act  as  Secretary  of  the  Treasury  until  a  successor  is 
appointed  or  until  the  absence  or  sickness  shall  cease: 

(1)  General  Counsel 

(2)  Assistant  Secretaries  in  the  order  in  which  they  took  the  oath  of  office 
as  Assistant  Secretary. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


400        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 

No.  188,  May  26,  1961. — Establishment  op  an  Ad  Hoc  Advisory  Committee 

ON  Ethical  Standards 

In  accordance  with  the  President's  message  of  April  27,  1961,  on  Ethical  Conduct 
in  Government,  there  is  established  in  the  Treasury  Department  an  Ad  Hoc 
Advisory  Committee  on  Ethical  Standards  constituted  as  follows: 

Chairman Robert  A.  Wallace 

Member Amos  N.  Latham,  Jr. 

Member John  K.  Carlock 

The  Committee  will  serve  in  an  advisory  capacity  on  ethical  problems  as  they 
arise. 

Problems  relating  to  bureau  heads  and  officials  who  report  directly  to  me  may 
be  referred  directly  to  the  Chairman  of  the  Ad  Hoc  Committee.  Problems 
relating  to  all  other  employees  shall  be  referred  to  the  Committee  through  normal 
personnel  channels. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


No.  189,  May  26,  1961. — Designation  of  Compliance  Officer  for  Recom- 
mendations Relating  to  the  President's  Committee  on  Equal  Employ- 
ment Opportunity  and  Also  Treasury  Department  Contracting  Practices 

By  virtue  of  the  authority  vested  in  me  by  Executive  Order  No.  10925  of 
March  6,  1961,  and  as  Secretary  of  the  Treasury  of  the  United  States,  I  hereby 
order  as  follows: 

1.  Pursuant  to  section  307  of  Executive  Order  No.  10925,  I  hereby  designate 
Mr.  Robert  A.  Wallace,  Special  Assistant  to  the  Secretary,  as  Principal  Com- 
pliance Officer  of  the  Treasury  Department.  Deputy  Compliance  Officers  as 
may  be  necessary  and  appropriate  to  carry  out  the  provisions  of  that  order  will 
be  designated. 

2.  I  hereby  assign  to  the  Principal  Comphance  Officer  the  responsibility  for 
conducting  studies  of  departmental  contracting  practices  and  for  recommending 
to  me  any  proposed  orders,  procedures,  or  other  measures  relating  to  the  contract- 
ing activities  of  this  Department  which  will  assure  maximum  effectiveness  in 
carrying  out  the  intent  and  purpose  of  Part  III  of  Executive  Order  No.  10925. 

3.  The  Principal  Compliance  Officer  shall  promptly  prepare  for  my  considera- 
tion recommendations  concerning  any  actions  that  the  President's  Committee  on 
Equal  Employment  Opportunity  might  initiate  to  assure  the  prompt  eradication 
of  all  vestiges  of  racial,  religious,  or  other  unfair  discrimination  from 
our  Government. 

4.  The  functions  assigned  to  Mr.  Robert  A.  Wallace  by  this  order  shall  be  in 
addition  to  the  functions  assigned  to  him  by  Administrative  Circular  No.  13, 
Revised,  dated  February  18,  1961. 

5.  This  order  is  effective  this  date. 

Douglas  Dillon, 
Secretary  of  the  Treasury. 


I 


TABLES 

Note. — In  tables  where  figures  have  been  rounded  to  a  specified  unit  and  where 
calculations  have  been  made  from  unrounded  figures,  the  details  may  not  check 
to  the  totals  shown. 


Bases  of  Tables 

The  figures  in  this  report  are  shown  on  the  basis  of:  (a)  The  Daihj  Statement 
of  the  United  States  Treasury,  (b)  the  Monthly  Statement  of  Receipts  and  Expendi- 
tures of  the  United  States  Government,  (c)  warrants  issued,  (d)  public  debt  accounts, 
and  (e)  administrative  accounts  and  reports.  Where  no  basis  is  indicated,  the 
figures  are  derived  from  administrative  reports  prepared  according  to  various 
specifications.  Where  more  than  one  basis  is  used  in  a  single  table  that  covers 
a  period  of  years,  the  dates  of  the  changes  in  bases  are  stated. 

Data  on  the  first  two  bases  are  derived  from  the  pubhcations  indicated  by  their 
titles.  The  monthly  statement  was  first  published  in  February  1954,  and  reports 
budget  results  which  previously  had  been  shown  in  the  daily  statement.  At 
the  same  time,  the  latter  became  a  statement  of  cash  deposits  and  withdrawals 
affecting  the  account  of  the  Treasurer  of  the  United  States.  (See  exhibits  69,  70, 
and  71  in  the  1954  Annual  Report.)  The  sources  of  data  used  in  these  two  publi- 
cations and  the  bases  of  tables  in  this  report  are  hereinafter  described. 

Daily  Statement  of  the  United  States  Treasury 

Until  February  1954  the  daily  Treasury  statement  (publication  of  which 
started  on  January  2,  1895)  not  only  covered  transactions  cleared  through  the 
Treasurer's  account  but  included  certain  transactions  by  Government  agencies 
which  were  handled  through  commercial  bank  accounts.  It  carried  information 
on  the  status  of  the  Treasurer's  account  and  on  public  debt  issues,  retirements, 
and  amounts  outstanding.  Receipts  and  expenditures  were  classified  beginning 
with  July  1,  1930,  to  show  the  budget  results  for  a  given  period  and  were  used 
as  a  basis  for  reporting  the  results  under  the  President's  budget  program  as  enacted 
by  the  Congress.  Prior  to  October  1,  1915,  receipts  and  expenditures  were 
reported  in  the  statement  on  the  basis  of  warrants  issued  and,  beginning  with  that 
date,  the  reporting  was  changed  to  a  clearance  basis,  that  is,  on  the  basis  of  in- 
formation shown  on  bank  transcripts  received  and  cleared  by  the  Treasurer's 
Office.  Effective  July  1,  1946,  and  through  February  16,  1954,  expenditures 
were  on  the  basis  of  checks  issued  through  the  facilities  of  the  Treasury  Depart- 
ment's Division  of  Disbursement  while  certain  others,  principally  those  of  the 
Department  of  Defense  and  its  predecessor  organizations,  were  on  the  basis  of 
checks  paid  or  clearance  basis. 

Since  February  1954  the  Daily  Statement  of  the  United  States  Treasury  has 
covered  only  transactions  which  clear  through  the  Treasurer's  account.  For 
each  business  day  it  reflects  cash  deposits  and  withdrawals  in  that  account  and 
the  status  of  the  account. 

No  distinction  is  made  as  to  type  of  account  (budget,  trust,  etc.)  in  reporting 
deposits  and  withdrawals,  which  are  segregated  in  a  Hmited  number  of  classifica- 
tions. The  deposits  are  on  the  basis  of  certificates  of  deposit  cleared  through  the 
accounts  of  the  Treasurer  of  the  United  States.  Total  withdrawals  are  on  the 
basis  of  checks  paid  or  cash  disbursements  made  out  of  the  Treasurer's  account. 
Some  of  the  withdrawal  classifications  shown  are  reported  on  the  basis  of  mailed 
reports  of  checks  issued,  adjusted  by  means  of  clearing  accounts  to  the  total 
checks  paid.  Except  for  relatively  minor  amounts  interfund  and  intragovern- 
mental  transactions  are  excluded.  In  order  to  facilitate  current  reporting  and 
classification,  Federal  Reserve  Banks  at  the  close  of  each  day  report  by  telegraph 
the  balances  they  carry  in  the  Treasurer's  account  and  certain  other  information. 
The  pubhc  debt  "figures  in  the  daily  Treasury  statement  are  also  on  the  clearance 
basis,  as  developed  for  classification  purposes  by  the  Bureau  of  the  Public  Debt. 
During  periods  when  new  marketable  public  debt  issues  are  being  sold  or  when 
issues  mature,  reports  of  transactions  are  based  upon  telegrams  received  from 
the  Federal  Reserve  Banks.  (See  the  1953  Annual  Report  of  the  Secretary  of 
the  Treasury,  pages  108  and  321,  for  more  detailed  information  on  the  daily 
Treasury  statement.) 

Monthly  Statement  of  Receipts  and  Expenditures  of  the  United  States  Govern- 
ment 

In  February  1954  this  monthly  statement  replaced  the  daily  statement  as  the 
primary  source  of  budget  results  (budget  surplus  or  deficit)  and  other  receipt 
and  expenditure  data  classified  by  type  of  account.  (See  "Description  of  Accounts 
Relating  to  Cash  Operations"  on  p.  406).  This  statement  shows  all  receipts  and 
expenditures  of  the  Government,  including  those  made  from  cash  accounts  held 

403 


404   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

outside  the  United  States  Treasury.  The  information  in  the  monthly  statement 
is  compiled  from  reports  of  the  Treasurer  of  the  United  States  and  of  other  col- 
lecting and  disbursing  agencies,  including  those  agencies  which  maintain  checking 
accounts  in  commercial  banks.  These  reports  cover  transactions  recorded  in 
the  accounts  of  collecting  and  disbursing  agencies  during  the  reporting  period. 
The  net  of  transactions  as  compiled  from  these  reports  is  reconciled  in  the  monthly 
statement  to  changes  in  the  cash  balances  in  the  Treasurer's  account,  cash  held 
outside  the  Treasurer's  account,  and  changes  in  the  public  debt  outstanding. 

The  budget  receipts  and  expenditures  as  reported  in  this  statement  are  on  the 
following  bases. 

Receipts. — Receipts  of  taxes  and  customs  duties  are  reported  on  a  collection 
basis,  which  means  that  they  are  reported  as  of  the  time  that  the  cash  received  is 
placed  under  accounting  control.  The  various  other  receipts  are  reported  par- 
tially on  a  collection  basis  and  partially  on  a  deposits  confirmed  basis,  that  is, 
when  the  deposits  are  acknowledged  by  the  depositar}^  banks. 

Expenditures. — Expenditures,  except  those  for  interest  on  the  public  debt, 
are  reported  on  the  basis  of  checks  issued  by  disbursing  officers.  Certain  modifi- 
cations of  this  basis  are  described  in  the  following  paragraphs: 

(a)  Where  payment  is  made  in  cash  rather  than  by  check,  the  cash  payment 
also  is  considered  as  an  expenditure;  (b)  transactions  of  an  interfund  or  intra- 
governmental  nature  are  included  even  though  actual  issuance  of  checks  or  actual 
receipt  of  cash  may  not  be  involved.  Examples  of  these  transactions  are:  (1) 
Charges  made  against  budget  appropriations  representing  a  part  of  employees' 
salaries  which  are  transferred  to  the  civil  service  retirement  and  disability  fund 
and  the  employees'  life  insurance  fund,  or  which  are  withheld  for  individual 
income  taxes  and  for  bond  allotments;  (2)  public  debt  securities  which  are  ac- 
quired in  lieu  of  other  properties,  or  donated,  are  considered  as  a  constructive 
receipt  of  cash  and  therefore  the  par  amounts  of  such  securities  are  included  as 
budget  receipts  of  the  acquiring  agency;  (3)  where  a  debt  instrument  is  issued 
by  a  wholly  owned  Government  enterprise  to  either  the  public  or  another  wholly 
owned  enterprise,  in  lieu  of  a  check  in  payment  of  a  liability,  the  issuance  of  the 
debt  instrument  is  considered  to  be  a  budget  expenditure,  and  a  corresponding 
budget  receipt  of  the  receiving  agency.  On  the  other  hand,  payments  to  the 
Treasury,  principally  by  wholly  owned  Government  corporations,  for  retirement 
of  capital  stock  and  for  disposition  of  earnings  are  excluded  in  reporting  both 
budget  receipts  and  expenditures  as  these  transactions  do  not  affect  the  budget 
surplus  or  deficit.  For  the  same  reason,  financing  transactions  such  as  borrow- 
ings from  or  repayments  to  the  United  States  Treasury  are  excluded. 

Certain  other  transactions  are  excluded  from  budget  expenditures  even  though 
the  issuance  of  checks  is  involved.  Examples  of  these  transactions  are:  (a) 
Checks  issued  for  cash  advances  to  imprest  funds,  agent  cashiers,  and  others. 
Expenditures  are  then  taken  up  as  payments  are  made  from  such  advances 
(travel  advances,  however,  are  treated  as  expenditures  when  advanced) ;  (b) 
checks  issued  representing  transfers  between  disbursing  officers  or  between 
checking  accounts;  (c)  transactions  representing  investments  in  or  sales  of  public 
debt  securities;  and  (d)  sales  or  redemptions  of  obligations  of  Government  agencies 
in  the  market. 

From  February  1954  through  May  1955  the  public  debt  interest  expenditure 
figures  represented  interest  which  became  due  and  payable;  since  June  1955, 
interest  on  the  public  debt  has  been  reported  on  an  accrual  basis. 

Beginning  with  the  final  statement  for  June  30,  1960,  totals  shown  for  net 
budget  receipts  and  budget  expenditures  exclude  certain  interfund  transactions 
which  are  included  in  the  detail  of  both  budget  receipts  and  budget  expenditures. 
The  transactions  deducted  consist  of  interest  payments  and  minor  amounts  of 
certain  other  payments  made  by  Government  agencies  to  the  Treasurj'.  This 
reporting  change  has  been  made  in  accordance  with  the  i)lan  stated  in  the  Presi- 
dent's budget  message  of  January  18,  1960.  It  does  not  affect  t.he  budget  surphis 
or  deficit.  The  interfund  transactions  deducted  under  this  procedure  do  not 
include  the  payments  to  the  Treasurj'  by  wholly  owned  Government  corporations 
for  retirement  of  their  capital  stock  and  for  disposition  of  earnings.  These  capital 
transfers  have  been  excluded  from  budget  receipts  and  expenditures  since  July 
1,  1948. 

Warrants  issued 

Until  1950  the  use  of  warrants  was  an  integral  part  of  the  accounting  for  re- 
ceipts and  expenditures   and  the  basis  for  many  earlier  financial   statements. 


TABLES  405 

The  Budget  and  Accounting  Procedures  Act  of  1950  permitted  the  Secretary  of 
the  Treasury  and  the  Comptroller  General  of  the  United  States  jointly  to  waive 
the  legal  requirements  with  respect  to  the  use  of  warrants.  Under  the  authority 
of  this  act,  the  following  joint  regulations  were  issued:  No.  1,  effective  November 
1,  1950,  eliminated  the  necessity  for  issuance  of  covering  warrants,  the  requisi- 
tioning of  funds,  and  the  use  of  accountable  warrants  in  connection  with  repay- 
ments to  appropriations;  No.  2,  effective  May  1,  1951,  provided  that  appropriated 
funds  be  made  immediately  available  in  the  accounts  of  disbursing  officers;  No. 
3,  effective  July  1,  1951,  provided  that  certain  special  fund  and  trust  fund  receipts 
be  credited  directly  to  the  accounts  of  disbursing  officers;  and  No.  4,  effective 
July  1,  1955,  waived  the  requirements  with  regard  to  the  requisitioning  and 
advancing  of  funds  to  accountable  officers  and  the  issuance  and  counter-signature 
of  warrants  acknowledging  receipt  of  money  to  be  covered  into  the  Treasury. 
An  explanation  of  the  warrant  basis  for  receipts  and  expenditures  follows. 

Receipts. — Section  305  of  the  Revised  Statutes  as  amended  (31  U.S.C.  147) 
provides  that  the  receipts  for  all  moneys  received  by  tne  Treasurer  of  the  United 
States  "shall  be  indorsed  upon  warrants  signed  by  the  Secretary  of  the  Treasury, 
without  which  warrant,  so  signed,  no  acknowledgment  for  money  received  into 
the  Public  Treasury  shall  be  valid."  Covering  warrants  were  prepared  from 
certificates  of  deposit  mailed  to  the  Treasury,  principally  by  Government  de- 
positaries, showing  deposits  received.  The  figures  thus  compiled  were  on  a 
"warrants-issued"  basis.  Table  2  for  the  years  prior  to  1916  shows  receipts  on 
this  basis.  Since  these  certificates  did  not  reach  the  Treasury  simultaneously, 
all  receipts  for  a  fiscal  year  could  not  be  covered  into  the  Treasury  by  warrant  of 
the  Secretary  immediately  upon  the  close  of  the  fiscal  year.  Therefore,  certain 
certificates  of  deposit  representing  amounts  deposited  during  one  fiscal  year  were 
reported  as  the  next  year's  receipts. 

Prior  to  the  fiscal  year  1954  all  collections  of  internal  revenue,  customs,  and 
miscellaneous  receipts,  except  repayments  to  appropriations  and  certain  special 
and  trust  fund  receipts  as  provided  by  the  joint  regulations  previously  descril)(>d, 
were  covered  into  the  Treasury  by  warrants  signed  by  the  Secretary  of  the 
Treasury.  Beginning  with  the  fiscal  year  1954,  the  recording  of  receipts  by 
Treasury  offices  designated  for  that  purpose  by  the  Secretary  of  the  Treasury,  in 
receipt  accounts,  or  appropriation  and  fund  accounts,  i)ursuant  to  the  act  of  Julv 
31,  1894,  as  amended  (5  U.S.C.  255),  and  section  114(b)  of  the  Budget  and 
Accounting  Procedures  Act  of  1950  (31  U.S.C.  66b(b)),  has  constituted  the  official 
acknowledgment  of  moneys  received  and  covered  into  the  Treasury. 

Expenditures. — The  Constitution  of  the  United  States  provides  that  "No 
money  shall  be  drawn  from  the  Treasury,  but  in  conseciuence  of  appropriations 
made  by  law  *  *  *."  Section  305  of  the  Revised  Statutes  as  amended  (31 
U.S.C.  147)  requires  that  the  Treasurer  of  the  United  States  shall  disburse  the 
moneys  of  the  United  States  upon  warrants  drawn  by  the  Secretary  of  the  Treas- 
ury. Prior  to  1916,  reports  of  expenditures  were  based  on  the  amount  of  ac- 
countable and  settlement  warrants  issued  and  charged  to  the  appropriation 
accounts.  Since  accountable  warrants  covered  advances  to  disbursing  officers, 
such  expenditure  reports  necessarily  included  the  balances  of  funds  remaining 
unexpended  to  the  credit  of  the  disbursing  officers  at  the  close  of  the  fiscal  year. 
Effective  July  1,  1955,  joint  regulation  No.  4  waived  the  requirements  with 
regard  to  the  requisitioning  and  advancing  of  funds  to  accountable  officers  by 
warrant. 

Public  Debt  accounts 

The  figures  reported  on  this  basis  represent  transactions  which  have  been 
audited  by  the  Bureau  of  the  Public  Debt.  It  is  sometimes  several  months  after 
a  financing  operation  before  all  the  transactions  have  been  reported  and  audited. 
Therefore,  the  public  debt  figures  on  this  basis  differ  from  tliose  reported  in  the 
daily  Treasury  statement  since  the  latter  consist  of  transactions  cleared  through 
the  Treasurer's  account  during  the  reporting  period  (see  explanation  under 
"Daily  Statement  of  the  United  States  Treasury,"  on  p.  403).  A  reconciliation 
of  figures  on  the  two  bases  is  given  in  table  29. 

Administrative  accounts  and  reports 

Certain  tables  in  this  report  are  developed  from  the  accounts,  records,  and 
reports  of  the  administrative  agencies  concerned,  which  may  be  on  various  bases. 
These  tables  include  internal  revenue  collections,  customs,  postal  receipts,  sales 
of  savings  bonds  by  States,  prices  and  yields  of  securities,  customs  statistics, 


406   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

foreign  currency  transactions  in  the  accounts  of  the  Secretary  of  the  Treasury, 
and  balance  sheets,  statements  of  income  and  expense,  and  source  and  application 
of  funds  of  public  enterprise  funds. 

Internal  revenue  collections  (tables  17  and  18)  are  stated  partly  on  the  basis  of 
reports  of  directors  of  internal  revenue  representing  collections  made  by  these 
officers  and  partly  on  the  basis  of  reports  of  deposits  made  directly  to  the  Federal 
Reserve  Banks  under  the  depositary  receipt  procedure. 

Customs  collections  (table  19)  are  based  upon  reports  of  collectors  of  customs 
representing  collections  made  during  the  period. 

Postal  revenues  (table  21)  are  based  upon  reports  of  the  Post  Office  Department 
prepared  on  a  modified  accrual  basis  (revenues  earned  less  deferred  box  rentals, 
etc.). 

Description  of  Accounts  Relating  to  Cash  Operations 

Three  classes  of  accounts  are  maintained  with  respect  to  the  cash  operations 
of  the  Federal  Government.  First,  there  are  the  accounts  of  fiscal  officers  or 
agents,  collectively,  who  receive  monej^  for  deposit  in  the  United  States  Treasury 
or  for  other  authorized  disposition  or  who  make  expenditures  by  drawing  checks 
on  the  Treasurer  of  the  United  States  or  by  effecting  payments  in  some  other 
manner.  Second,  there  are  the  accounts  of  the  Treasurer  of  the  United  States 
whose  office,  generally  speaking,  is  responsible  for  the  receipt  and  custody  of 
money  deposited  by  fiscal  officers  or  agents;  for  the  payment  of  checks  drawn  on 
the  Treasurer  and  the  payment  of  public  debt  securities  redeemed.  These  ac- 
counts indicate  the  bank  or  financial  institution  holding  cash  balances  in  the 
name  of  the  Treasurer  of  the  United  States.  Third,  a  set  of  central  accounts  is 
maintained  in  the  Treasury  Department  for  the  purpose  of  consolidating 
financial  data  reported  periodically  from  these  two  operating  segments  in  order 
that  the  results  of  cash  operations  may  be  presented  in  central  financial  reports 
on  a  unified  basis  for  the  Government  as  a  whole,  and  as  a  means  of  internal 
control. 

The  central  accounts  relating  to  cash  operations  disclose  monthly  and  fiscal 
year  information  on:  (1)  The  Government's  receipts  by  principal  sources,  and 
its  expenditures  according  to  the  different  appropriations  and  other  funds  in- 
volved; and  (2)  the  cash  transactions,  classified  by  types,  together  with  certain 
directly  related  assets  and  liabilities  which  underlie  such  receipts  and  expendi- 
tures. The  accounting  for  receipts  is  substantially  on  the  basis  of  collections, 
and  that  for  expenditures  is  on  the  basis  of  checks  issued  and  cash  payments 
made  except  that  interest  on  the  public  debt  is  on  an  accrual  basis.  The  struc- 
ture of  the  accounts  provides  for  a  reconciliation,  on  a  firm  accounting  basis, 
between  the  published  reports  of  receipts  and  expenditures  and  budget  results 
for  the  Government  as  a  whole  and  changes  in  the  Treasurer's  cash  balance  by 
means  of  such  factors  as  checks  outstanding,  deposits  in  transit,  and  cash  held 
outside  the  Treasury.  Within  the  central  accounts,  receipt  and  expenditure 
accounts  are  classified  as  described  in  the  following  paragraphs. 

Budget  accounts 

Included  in  the  Budget  accounts  are  only  those  accounts  that  determine  the 
budget  surplus  or  deficit  of  the  United  States  Government  as  follows: 

General  fund  receipt  accounts. — The  general  fund  receipt  accounts  are  credited 
with  all  receipts  which  are  not  earmarked  by  law  for  a  specific  purpose.  General 
fund  receipts  consist  principally  of  internal  revenue  collections,  which  include 
income  taxes,  excise  taxes,  estate,  gift,  and  employment  taxes.  The  remainder 
consist  of  customs  duties  and  a  large  number  of  miscellaneous  receipts,  including 
fees  for  permits  and  licenses;  fines,  penalties,  and  forfeitures;  interest  and 
dividends;  rentals;  royalties;  sale  of  Government  property;  and  seigniorage. 

Special  fund  receipt  accounts. — Special  fund  receipt  accounts  are  credited 
with  receipts  from  specific  sources,  as  authorized  by  law,  but  which  are  not 
generated  from  a  cycle  of  operations.  Such  receipts  may  be  expended  only  for 
the  particular  purposes  specified  by  law.  The  Congress  may  appropriate  these 
receipts  for  special  purposes  on  an  annual  basis  or  for  an  indefinite  period  of 
time.  Although  such  receipts  are  not  available  for  general  purposes,  they  are 
included  in  the  totals  of  budget  receipts.  Examples  of  special  fund  receipts 
are  those  arising  from  rents  and  royalties  under  the  Mineral  Leasing  Act,  the 
revenue  from  visitors  to  Yellowstone  National  Park,  the  proceeds  of  the  sale 


TABLES  407 

of  certain  timber  and  reserve  lands,  and  other  receipts  authorized  to  be  credited 
to  the  reclamation  fund. 

General  fund  expenditure  accounts. — General  fund  expenditure  accounts  are 
established  to  record  amounts  (either  specific  or  indefinite)  appropriated  by  the 
Congress  to  be  expended  respectively  for  the  general  support  of  the  Government. 
Such  accounts  are  classified  according  to  the  limitations  that  are  established 
by  the  Congress  with  respect  to  the  period  of  availability  for  obligation  of  the 
appropriation,  as  1-year,  multiple-year,  or  "no-year"  (without  a  time  limit), 
and  with  respect  to  the  agency  authorized  to  enter  into  obligations  and  approve 
expenditures. 

Special  fund  expenditure  accounts. — Special  fund  expenditure  accounts  are 
established  to  record  appropriated  amounts  of  receipts  from  specific  sources  to 
be  expended  only  for  the  specific  purpose  authorized  by  law.  These  accounts 
are  generally  available  without  time  limit,  but  may  also  be  subject  to  fiscal 
limitations  as  in  the  case  of  general  fund  accounts. 

Revolving  and  management  fund  accounts. — These  are  funds  authorized  by  spe- 
cific provisions  of  law  to:  (a)  Finance  a  continuing  cycle  of  operations  with 
receipts  derived  from  such  operations  available  without  further  action  by  Con- 
gress; or  (b)  facilitate  accounting  for  and  administration  of  intragovernmental 
operations,  other  than  a  continuing  cycle  of  operations.  Treasury  reports  gen- 
erally show  the  net  effect  of  operations  in  the  accounts  (excess  of  disbursements 
or  collections  and  reimbursements  for  the  period)  which  aff"ect  the  budget  surplus 
or  deficit.  These  accounts  are  usually  designated  as  "no-year"  accounts  and 
are  without  limitation  as  to  period  of  availability  for  obligation  or  expenditure. 
Examples  of  such  accounts  include  corporate  revolving  funds  such  as  those  under 
the  Export-Import  Bank  of  Washington,  the  Commodity  Credit  Corporation, 
and  other  revolving  funds  such  as  the  General  Supply  Fund  administered  by  the 
General  Services  Administration  and  the  working  capital  fund  of  the  Public 
Buildings  Service. 

Consolidated  working  fund  accounts. — These  are  accounts  established  to  receive 
and  disburse  advance  payments  by  an  agency  from  other  agencies  or  bureaus 
pursuant  to  Section  601  of  the  Economy  Act  (31  U.S.C.  686)  or  other  provi- 
sions of  law  to  be  expended  for  purposes  authorized  by  law.  "Consolidated" 
working  funds  may  be  credited  with  advances  from  two  or  more  appropriations 
for  the  procurement  of  goods  or  services  to  be  furnished  by  the  performing 
agency,  with  the  use  of  its  own  facilities  within  the  same  fiscal  year.  Expendi- 
ture transactions  recorded  in  these  accounts  are  stated  net  of  advances  credited 
and  are  classified  under  the  agencies  administering  the  accounts.  The  accounts 
are  subject  to  the  fiscal  year  limitations  of  the  parent  appropriations  or  other 
accounts  from  which  advanced. 

Nonbudget  accounts 

Trust  accounts. — These  are  accounts  maintained  to  record  the  receipt  and 
expenditure  of  moneys  held  in  trust  by  the  Government  for  use  in  carrying  out 
the  specific  purposes  or  programs  in  accordance  with  the  terms  of  a  trust  agree- 
ment or  statute.  The  receipts  of  many  trust  funds,  especially  the  major  ones, 
not  needed  for  current  benefits  and  other  payments,  are  invested  in  United 
States  securities.  Generally,  trust  fund  accounts  consist  of  separate  receipt  and 
expenditure  accoimts,  but  when  the  trust  corpus  is  established  to  perform  a 
business-type  operation,  the  fund  entity  is  called  a  "trust  revolving  fund"  and 
a  combined  receipt  and  expenditure  account  is  used.  Unlike  the  funds  in  gen- 
eral and  special  accounts,  the  trust  funds  are  not  available  for  general  or  special 
purposes  and  do  not  enter  into  the  budget  surplus  or  deficit.  Some  of  the  major 
trust  accounts  are  the  Federal  old-age  and  survivors  insurance  trust  fund, 
unemployment  trust  fund,  civil  service  retirement  fund,  and  the  national  service 
life  insurance  fund. 

Deposit  fund  accounts. — Deposit  funds  are  combined  receipt  and  expenditure 
accounts  established  to  account  for  receipts  that  are  either  (a)  held  in  suspense 
temporarily  and  later  refunded  or  paid  into  some  other  fund  of  the  Government 
upon  administrative  or  legal  determination  as  to  the  proper  disposition  thereof, 
or  (b)  held  by  the  Government  as  banker  or  agent  for  others  and  paid  out  at 
the  direction  of  the  depositor.  Such  funds  are  not  available  for  paying  salaries, 
expenses,  grants,  or  other  expenditures  of  the  Government.  As  in  the  case  of 
the  trust  funds,  the  transactions  in  these  accounts  are  not  included  in  the  budget 
totals. 


408   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Summary  of 


Table  1. — Summary  of  fiscal  operations, 
[On  basis  of  dally  Treasury  statements  through  1952; '  thereafter  on  basis  of  "Monthly  Statement 


Fiscal  year  or  month 


Budget  receipts  and  expenditures 


Net  receipts  ^ 


Expenditures ' 


Surplus,  or 
deficit  (— ) 


Trust  account 
and  other 

transactions, 
net  receipts, 
or  expendi- 
tures (— )  « 


Clearing 
account ' 


1932 

1933...- 

1934 

1935 

1936 

1937 

1938 

1939 

1940 

1941 

1942 

1943 

1944 

1945 

1946 

1947 

1948' 

1949  9 

1950 

1951 

1952 

1953 

1954 

1955.. 

1956 

1957 

1958 

1959 

I960-.. 

1961 

1960— July 

August 

September 

October 

November. 

December. 

1961 — January... 

February. . 

March 

April 

May 

June 


10, 


923, 891,  824 
996, 843. 833 
014,969,799 
705. 955. 600 
997, 058, 975 
955,  612,  556 
588,011,873 
979, 005.  958 
137, 249,  771 
095, 676, 052 
546,  618,  755 
947. 283. 157 
562. 609,  460 
362, 020.  944 
649, 870,  986 
677,167,024 
374,  701, 989 
662, 972.  939 
421,934,577 
480, 067, 075 
286,  560,  916 
670,  584, 424 
420, 034, 061 
208,  508,  692 
849,951,339 
561,886,113 
549,  720. 044 
915,348,624 
763, 460, 221 
659.  424, 972 
127.  663,  585 
453,  983,  691 
981,156,218 
822, 942,  594 
300. 308,  846 
642,  962. 862 
845.  867. 142 
537,185,623 
524,109,982 
125,236,215 
467,  284,  745 
830,  723,  463 


$4, 659, 
4.  598. 
6,644, 

6,  497, 
8,421. 

7,  733, 
6,  764, 
8.841, 
9. 055, 

13,254. 
34, 036, 
79,  367. 
94. 986, 

98. 302. 
60,  326, 
38. 923, 
32,  955, 
39, 474, 
39,  544. 
43,  970, 

65. 303, 
74,119, 

67,  537, 
64, 388. 
66, 224. 

68,  960, 
71,369. 
80, 342, 
76.  539, 
81,515, 

6.171, 
6,  803, 
6,  793, 
6,  828. 
6.  773. 
6,816, 
6,  469, 
6. 235. 
7,012. 

6,  450, 
7.169. 

7,  960, 


181,  532 
49.5,  918 
601,  741 
007,  700 
608,  205 
033, 270 
628, 471 
223, 998 
268,  931 
948,411 
861,487 
713.  522 
002, 002 
937, 069 
041,  595 
379, 364 
232. 145 
412,987 
036. 935 
284. 450 
201,294 
797,  882 
000,317 
737,614 
397,  935 
314,562 
174,086 
335,  375 
412,  799 
167,520 
728,  886 
089,  779 
356, 824 
778,  445 
431,347 
616,318 
545,  270 
774, 966 
427,  45 
355.  807 
462,  257 
600, 159 


-$2. 735, 
-2,601, 
-3,  629, 
-2,  791, 
-4,  424, 
-2,777, 
-1,176, 
-3,  862, 
-3,918, 
-6,159, 
-21,490, 
-57,420, 
-51,  423, 
-53,940, 
-20,  676, 
753, 

8,419, 
-1,811, 
-3,122, 

3,  509, 
-4.016. 
-9, 449, 
-3.116. 
-4,180, 

1,625, 

1.  ,595. 
-2,819, 

-12.  426, 

1,224, 

-3,  855, 

-3,  044, 

-3i9, 

2,187, 

-4,  005, 

-473, 

796. 

-1, 623. 

301 

1,511 

-1,325, 

-702, 

2,  870, 


289, 708 
652, 085 
631,943 
0,52,100 
549, 230 
420,714 
616,598 
158,040 
019,161 
272, 358 
242.  732 
430,  365 
392. 541 
916.126 
170,609 
787,  660 
469, 844 
440. 048 
102.357 
782. 624 
640, 378 
213.  457 
966, 256 
228, 921 
553,  403 
571,550 
454,041 
986,  751 
047, 422 
742,  548 
065, 301 
106.  087 
799, 394 
835,  851 
122,  500 
346,  544 
678, 128 
410,657 
682,  525 
119,592 
177,512 
123. 304 


-5, 

834, 

402. 

187, 

3, 

98, 

1,209, 

442, 

907, 

-1,612, 

-337, 

-2,221, 

791, 

-523, 

-1,102, 

-294, 

-494, 

99, 

679, 

147, 

434, 

327, 

231 

-193, 

194, 

632, 

-328. 

-49, 

-602, 

-94 

-567, 

-123 


—221, 

-184i 

711, 

-628, 

24, 

48, 

-14, 


178, 050 
009, 989 
880, 108 
724,190 
063, 025 
314,169 
934, 030 
673,  564 
538, 143 
790,  781 
785, 695 
796,138 
918,654 
293, 666 
587, 210 
524. 942 
342, 662 
733. 365 
137,360 
223.  478 
077, 201 
671,979 
762, 083 
296,  942 
580,  583 
731,536 
513.036 
663, 331 
526, 275 
403,  079 
703, 201 
411,728 
528,  535 
014,33: 
133,  748 
234.  037 
932.  286 
654,  60 
784,  765 
238.  039 
523,  846 
373, 097 


.$554,  706. 981 

-507,106,039 

366,441,900 

482,  656.  886 

-214,140,135 

-401,389,312 

-249.  920,  729 

-303.126,484 

283,518,269 

521,955,153 

-522,  892, 840 

530, 045,  771 

-5,750,464 

-145, 025,  682 

507,  346,  821 

124,  809,  797 

-521,428,231 

607. 189. 129 

217,279,30 

-663,  093,  808 

202,  350,  791 

407.  555, 356 

-.58, 057,  864 

691,  540,  793 

24,  567,  358 

-376.  772.  665 

-148,  593, 142 


'  With  the  exceptions  that  public  debt  figures  are  on  the  basis  of  daily  Treasury  statements  for  all  years 
shown  and  guaranteed  obligations  for  1934-39  are  on  the  basis  of  pubhc  debt  accounts  and  thereafter  on  the 
basis  of  daily  Treasury  statements.  Public  debt  includes  debt  incurred  to  finance  expenditures  of  certain 
wholly  owned  Government  corporations  and  other  business-type  activities  in  exchange  for  which  obligations 
of  the  corporations  and  activities  were  issued  to  the  Treasury.     (See  table  124.) 

-  Total  receipts  less  refunds  of  receipts  and  starting  with  fiscal  1937,  less  transfers  of  tax  receipts  to  certain 
major  trust  accounts  (as  shown  in  table  3);  and  exclusive  also  of  certain  interfund  transactions  (also  excluded 
from  expenditures)  which  are  shown  in  table  5.  The  figures  in  annual  reports  before  1960  did  not  exclude 
interfund  transactions. 

3  Expenditures  are  "net"  after  allowance  for  reimbursements  to  appropriations,  receipts  of  revolving 
fund  accounts,  and  receipts  credited  to  disbursing  accounts  of  corporations  and  agencies  having  authority 
to  use  collections  without  formal  covering  into  the  Treasury.  The  figures  include  transfers  to  trust  accounts. 
Beginning  with  1951,  the  net  Investments  by  wholly  o\^•ned  Government  corporations  and  agencies  in 
public  debt  securities  are  excluded  from  budget  expenditures  and  are  included  in  trust  account  and  other 
transactions.  The  expenditure  figures  also  exclude  |)ublic  debt  retirements  ch.-irgeable  to  the  sinlving  fund, 
etc.,  under  special  provisions  of  law.  Effective  July  1,  1948,  payments  to  the  Treasury,  principally  by 
wholly  owned  Government  corporations,  for  retirement  of  capital  stock  and  disposition  of  earnings  are 
excluded  from  both  receipts  and  expenditures.  Trior  year  adjustments  of  such  payments  are  shown  in 
the  1958  annual  report,  p.  396,  table  2,  footnote  3.  Beginning  with  fiscal  1932,  certain  interfund  trans- 
actions are  excluded,  as  from  net  receipts,  the  content  of  which  is  shown  in  table  5.  The  figures  in  annual 
reports  before  1960  did  not  exclude  interfund  transactions. 


TABLES 


409 


Fiscal  Operations 


fiscal  years  1933-61  and  monthly  1961 

of  Receipts  and  Expenditures  of  the  United  States  Qovernment,"  see  "  Bases  of  Tables"] 


Public  debt, 

net  increase, 

or  decrease 

(-) 


Balance 
in  account  of 
the  Treasurer 
of  the  U.S., 
net  increase, 
or  decrease 
(-) 


Amount,  end  of  period 


Balance 

in  account  of 

the  Treasurer 

of  the  U.S 


Debt  outstanding ' 


Public  debt 


Guaranteed 

obligations 
held  outside 
the  Treasury 


Total ' 


Subject    to 
limitation ' 


$2,  685,  720,  952 
3,051,670,116 
4,  514,  468,  854 

1,  647,  751, 210 
5, 077,  650,  869 

2,  646, 070.  239 
740, 126,  583 

3,  274,  792, 096 

2,  527,  998,  627 
5, 993,  912, 498 

23, 461, 001,  581 
64, 273,  645, 214 
64, 307, 296, 891 
57,  678,  800, 189 
10,739,911,763 
-11.135,716,065 
-5,  994, 136,  596 
478,113,347 

4,  586,  992,  491 
-2, 135,  375,  536 

3,  883,  201, 970 
6,  965, 882, 853 
5. 188,  537,  469 
3, 114,  623,  694 

-1,623,409,153 

-2, 223,  641,  752 

5, 816, 045,  849 

8, 362,  689,  332 

1,  624,  853,  770 

2.  640, 177,  762 
2, 007,  510, 187 

333,  947,  859 
-248,  886, 121 
2,  063, 399, 862 
-72,617,642 
-197,299,751 
-181,2.54,843 

508,  029,  882 
-3,  072, 188,  847 

515,  765,  470 
2, 158, 473,  937 
1, 174,  702, 232 


-$54,  746,  805 
445, 008, 042 

1,719,717,020 

-740,  576.  701 
840, 164,  664 

-128. 036,  307 

-337,  555,  984 
622,  307,  620 

-947,  482.  391 
742,  430, 921 
357, 973, 154 

6,  515,  418,  710 
10,  661,  985,  696 

4,  529, 177,  729 
-10,459,846,056 
-10,929,746,366 

1,  623,  884,  548 
-1,461,618,165 

2, 046,  684,  380 
1, 839,  490, 432 
-387,  750,  519 

-2,  298,  579,  356 
2,096,206,813 
-550,  790, 014 
3.30,  518,  820 
-956,  231,  506 
4, 159. 150,  615 

-4,398,711,214 

2,  654.  349,  235 
-1,310,621,045 

1,006,448,518 
1, 103,  998, 187 
2,  422,  573, 868 

-1,  645, 142, 349 

-840,  700,  205 

580,163,546 

-1,  582, 309,  900 
1,  463, 037,  283 

-1,  497,  750,  294 
-760,548,725 
1, 128,  047,  605 
1, 532, 454, 834 


$417, 
862, 
2,  581, 
1,841, 
2,  681, 
2,  553, 
2,  215, 
2,  838, 

1,  890, 

2,  633, 
2, 991, 
9,  506, 

20,  168, 
24,  097, 
14,  237, 

3,  308, 
4, 932, 

3,  470, 
5,517, 
7,  356, 
6,  968, 

4,  670, 
6,  766, 

«6,215, 
6,  546, 
5, 589, 
9,  749, 

5,  350, 
8. 004, 

6,  694, 
6,  998, 
5,  894, 
8,316, 
6, 671, 
5,831, 
6,411, 
4,  828, 
6,291, 
4,  794, 
4, 033, 
5,161, 
6, 694, 


197. 178 
205,  221 
922,  240 
345,  539 
510,  204 
473,  897 
917,913 
225,  533 
743, 141 
174,062 
147,216 
565,  92( 
551,  622 
729,  352 
883,  295 
136,  929 
021,  477 
403,  312 
087.  692 
578, 123 
827,  604 
248, 248 
455, 061 
665, 047 
183, 868 
952,  362 
102,  977 
391,  763 
740.  998 
119,954 
292,  479 
294,  291 
868,160 
725, 810 
025,  605 
189, 151 
879,  250 
916,533 
166,239 
617,514 
665, 119 
119,  954 


$19,  487, 

22,  538, 

27, 053. 

28,  700, 

33,  778, 

36,  424, 

37, 164, 

40,  439. 

42,  967, 

48,  961, 

72,  422, 

136,  696, 

201. 003, 

258,  682, 

269, 422, 

258.  286. 

252,  292, 

252,  770, 

257,  357. 

255, 221, 

259, 105, 

266,071, 

271,  259, 
274, 374, 

272,  750, 
270,  527, 
276,  343, 
284.  705. 
286.  330, 
288,  970, 
288, 338. 
288,  672, 
288,  423, 
290,  486, 
290,  414. 
290,216, 
290,  035, 
290,  543, 
287,471, 
287, 987, 
290,145, 
288, 970, 


002,  444 
672,  560 
141,414 
892,  625 
543,  494 
613,  732 
740, 315 
532,411 
531, 038 
443,  536 
445.  116 
090, 330 
387,  221 
187,410 
099. 173 
383, 109 
246,  513 
359,  860 
352,  351 
976,  815 
178,  785 
061,  639 
599, 108 
222, 802 
813,  649 
171.896 
217,745 
907, 078 
760,  848 
938,  610 
271,035 
218, 895 
332,  773 
732, 635 
114,993 
815,241 
560, 398 
590,  280 
401,433 
166,904 
640, 841 
938, 610 


$680,  767, 
4, 122,  684, 
4,  718, 033. 
4,  664,  604, 

4,  852,  791, 

5.  450. 834, 

5,  529,  070. 

6,  370,  252, 
4,  568,  259, 
4,  099.  943, 
1,  623. 069. 

433. 158, 

476, 384, 

89,  520, 

73,  460, 

27,  275, 

19,  503. 

29.  227, 

45,  565, 

52, 072, 

81,441, 

44, 142, 

73,  888, 

107, 137, 

101.  220. 

111,019, 

139,  841, 

240,215, 

134, 189, 

156,  859, 

161,031, 

159,  075, 

153,  056, 

155,938. 

160, 486, 

196, 067, 

210,  844, 

219.  097, 

225,  390, 

240, 215, 


002, 444 
672,  560 
909,  231 
577,316 
576,  735 

218. 265 
531,  967 
366.  510 
601,693 
696, 116 
704,  746 
033,  376 
456,  522 
345,  802 
484, 033 
903,  294 
707, 331 
635, 268 
855,  385 
203,  984 
744, 131 
134,  400 
040, 494 
365,  763 
702, 124 
309,  846 
438, 345 
926,  228 
602,  623 
154,060 
460,  810 
078,  570 
364,  473 
808,  535 
171,893 
753,  566 
047,  073 
657,  305 
245,  858 
264,  679 

037. 266 
154,  060 


(n 

(') 

(0 

(0 
881, 899,  956 
371,110,606 
219, 123,  375 
493,  588,  731 
154,  457.  607 
469, 083,  742 
077,  255, 051 
670,  763,  468 
932,  355,  302 
491,416,060 
541,  571,  385 
027,  712,  585 
652, 133,  429 
566,  629,  670 
506,  598. 138 
521.  736, 381 
790,304,616 
914,  849,  696 
361,216,449 
188,  321, 086 
013,  439,  621 
398,  474, 090 
064,  964,  324 
861,862,530 
067,911,935 
424,  890,  549 
180,520,738 
243,  507, 053 
165,187,891 
971,198,190 
795,  752,  640 
340,376,187 
283,  980,  274 
808,671,653 
974,591,045 
861,  862,  530 


*  Consists  of  transactions  of  trust  and  deposit  fund  accounts,  net  investments  by  Government  agencies 
in  public  debt  securities,  and  net  redemptions  or  sales  of  obligations  of  Government  agencies  in  the  market. 
(See  table  9.)  Investments  by  wholly  owned  Government  corporations  in  public  debt  securities  are  in- 
cluded in  budget  expenditures  before  1951.  Retirements  of  national  bank  notes  chargeable  against  the 
increment  on  gold  (fiscal  years  1935-39)  are  excluded. 

•  For  checks  outstanding  and  telegraphic  reports  from  Federal  Reserve  Banks;  public  debt  interest  accrued 
and  unpaid  beginning  with  June  and  the  fiscal  year  1955  (previously  included  from  November  1949  as  interest 
checks  and  coupons  outstanding) ;  also  deposits  in  transit  and  changes  in  cash  held  outside  the  Treasury  and 
in  certain  other  accounts  beginning  with  the  fiscal  year  1954.  For  1955  includes  adjustment  of  —.$207,183,858 
for  effect  on  balance  in  Treasurer's  account  due  to  reclassification  in  November  1954  of  Post  Office  disbursing 
accounts. 

8  A  summary  of  legislation  on  debt  limitation  under  the  Second  Liberty  Bond  Act  from  Sept.  24,  1917, 
through  June  30,  1961,  is  shown  in  table  34.  Guaranteed  securities  held  outside  the  Treasury  are  included 
in  the  limitation  beginnine  Apr.  3, 1945.  Savings  bonds  are  included  at  current  redemption  value  beginning 
June  26,  1946;  before  that  date  they  are  included  at  maturity  value.  In  the  debt  outstanding,  savings  bonds 
are  carried  at  current  redemption  value. 

?  Prior  to  May  26,  1938,  the  limitation  applied  to  particular  segments  of  the  debt,  not  to  the  total. 

8  Excludes  transfer  of  $3,000,000,000  in  1948  and  includes  transfer  of  a  like  amount  in  1949  to  the  Foreign 
Economic  Cooperation  Trust  Fund.     (See  table  2,  footnote  9.) 

'Includes  adjustment  of  -$207,183,858  which  reflects  the  reclassification,  begun  in  November  1954,  of 
Post  OflSce  Department  and  postmasters'  disbursing  accounts  (formerly  treated  as  liability  accounts  of  the 
Treasurer  of  the  United  States)  to  net  expenditures  on  the  basis  of  cash  receipts  and  expenditures  as  reported 
by  the  Post  OflQce  Department. 


410   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Receipts  and 

Table  2. — Receipts  and  expendi- 


[On  bajls  of  warrants  Issued  from  1789  to  1915  and  on  basis  of  daily  Treasury  statempnts  for  191 G  through 
of  the  United  States  Government."  General,  special,  emergency,  and  trust  accounts  combined  from 
see  "Bases  of  Tables"] 


1 

Receipts 

Year  « 

Customs 

(including 

tonnage  tax) 

Internal  revenue 

Other  re- 
ceipts ' 

Total 
receipts « 

Net  re- 
ceipts 

Income  and 
profits  taxes 

Other 

1789-91  

$4.  399.  473 

3,  443.  071 

4,  255.  307 
4,801,065 

5,  588,  461 

6,  567,  988 

7,  549,  650 
7, 106,  062 
6, 610,  449 

9, 080, 933 
10,  750,  779 

12,  438,  236 
10,479.418 
11,098,565 
12, 936,  487 
14,  667,  698 
15, 845,  522 

16,  363, 551 
7, 296, 021 

8,  583, 309 
13,313,223 

8,  958,  778 

13,  224.  623 
5,  998,  772 
7,  282,  942 

36,  306, 875 

26,  283.  348 
17, 176, 385 
20, 283, 609 

15,005,612 
13, 004,  447 

17,  589,  762 
19, 088,  433 

17. 878. 326 
20, 098,  713 
23,341,332 
19,712.283 

23,  205,  524 

22,  681,  966 

21,922,391 

24,  224,  442 
28.  465.  237 
29,032,509 
16,214,957 
19,391,311 
23, 409, 941 
11,169,290 
16,158,800 
23, 137, 925 

13,  499,  502 
14,487,217 
18, 187, 909 
7, 046, 844 
26, 183,  571 

27,  528, 113 
26,  712,  668 

23,  747, 865 
31,757,071 
28, 346, 739 

39, 668, 686 
49,017,568 

47. 339. 327 
58,  931,  866 
64,  224, 190 
53, 025, 794 
64. 022, 863 

$19, 440 

17,946 

59,910 

356,  750 

188,  318 

1, 334.  252 

663.  640 

150,  076 

157,  228 

958,  420 
1,136.519 
1, 935.  659 
369.  500 
676.  801 
602.  459 
872,132 
639.  446 
688.  900 
473, 408 

793, 475 
1,108.010 

837,  4.52 
1,111,032 

3,  519,  868 
3, 768, 023 
6,  246. 088 

4,  137,  601 
3,453,516 
4, 090, 172 

2, 768,  797 

1,  499,  905 

2,  575, 000 
1,417.991 
1,468.224 
1,716.374 
1,897,512 
3,234.195 

1,  540,  654 
2,131,158 

2,  909,  564 
4,  295.  445 

3,  388,  693 

4,  913, 159 
6,  672,  783 

16,028,317 
27, 416,  485 
13,  779, 369 
10,141,295 
8,342,271 

5,978,931 
2,  369,  682 

1,  787,  794 
1,2.55,  7,';5 
3, 136, 026 

2,  438,  476 
2,  984,  402 

2,  747,  529 
3, 978,  333 
2,861,404 

3, 934, 753 

3,  541,  736 
2,  507,  489 
2,655,188 
9,576,151 

12,  324,  781 
10, 033, 836 

$4,418,913 

3.  669.  960 

4.  652.  923 
5,431.905 
6,114,534 
8,  377,  .530 
8,  6S8.  781 
7,  900,  496 
7,546,813 

10,  848,  749 

12,  935, 331 

14,  995.  794 
11,064,098 
11,826.307 

13,  560,  693 

15.  559,  931 
16,398,019 
17, 060.  662 

7,  773,  473 

9,384.215 

14,  423,  529 
9,801,1.33 

14,  340,  410 
11,181,625 
15,729,024 
47, 677,  671 
33,  099,  050 
21,585,171 
24, 603, 375 

17, 880,  670 
14,573,380 
20,  232.  428 
20,  540,  666 
19,381,213 
21.840.8.58 

25,  260,  434 
22.  966.  364 
24.  763.  630 
24,  827,  627 

24.844,116 
28,  526,  821 
31,865,561 
33,  948,  427 
21,791,936 
35,  430,  087 
50,  826,  796 
24,954,153 
26, 302,  562 
31, 482,  749 

19,480,115 
16,860,160 
19,976,198 
8, 302,  702 
29,321,374 
29, 970, 106 
29, 699,  967 

26,  495,  769 
35,  735,  779 
31,  208, 143 

43,  603.  439 
52.  559.  304 
49,846,816 
61,587,054 
73,800,341 
65, 350,  575 
74,056,699 

1792 

$208,  943 
337,  706 
274,  090 
337, 755 
475,  290 
575,49) 
644,  358 
779, 136 

809, 390 

1, 048, 033 

621,899 

215,180 

50.941 

21.747 

20. 101 

13,051 

8,211 

4,044 

7,431 

2,296 

4,903 

4,755 

1, 662,  985 

4,  678, 059 

5, 124,  708 

2, 678, 101 

955,  270 

229,  594 

106, 261 
69.  028 
67.  666 
34.  242 
34.  663 
25.  771 
21,590 
19, 886 
17,  452 
14, 503 

12,161 
6,934 

11,631 
2,759 
4,196 

10, 459 
370 
5,494 
2,467 
2,553 

1,  682 

3,261 

495 

103 

1,777 

3.517 

2,897 

375 

375 

1793 

1794 

1795 

1796 

1797 

1798 

1799        

1800            

1801 

1802 

1803 

1804 

1805              .     .. 

1806 

1807 

1808      .  .. 

1809 

1810 

1811 

1812 

1813 

1814 

1815     

1816 

1817 

1818 

1819 

1820 

1821 

1822 

1823 

1824     

1825 

1826 

1827 

1828 

1829 

1830 

1831 

1832 

1833 

1834  -- 

1835 

1836 

1837 

1838 

1839 

1840 

1841     

1842 

1843  ' 

1844 

1845  .     . 

1846 

1847 

1848 

1849 

1850 

1851 

1852 

1853.     . 

1854 

1855 

1856 

Footnotes  at  end  of  table. 


TABLES 


411 


Expenditures 

tures,  fiscal  years  1789-1961 

1952.    Beginning  with  fiscal  year  1953  on  basis  of  the  "Monthly  Statement  of  Receipts  and  Expenditures 

1789  through  1930.    Trust  accounts  excluded  for  1931  and  subsequent  years.    For  explanation  of  accounts 


Expenditures 

Department  of 

Surplus,  or 

the  Army 

Department  of 

Interest  on  the 

Total  expendi- 

deficit  (-) 

(formerly  War 

the  Navy « 

public  debt 

Other  » 

tures » 

Department)  * 

$632, 804 

$570 

$2, 349,  437 

$1, 286, 216 

$4,  269, 027 

$149, 886 

1, 100,  702 

63 

3,  201,  628 

777, 149 

5,  079,  532 

-1,409,572 

1  130  249 

2,  772  242 

579,  822 
800, 039 

4,  482, 313 
6,  990, 839 

170,  610 
-1,558,934 

2,  639, 098 

6i,"409 

3,  490,  293 

2,  480,  910 

410,  562 

3, 189, 151 

1,  459, 186 

7,  539,  809 

-1,425,275 

1, 260,  264 

274,  784 

3, 195,  055 

996,  883 

5,  726,  986 

2,  650,  544 

1, 039,  403 

382,  632 

3, 300, 043 

1,411,556 

6, 133,  634 

2,  555, 147 

2, 009,  522 

1, 381,  348 

3, 053,  281 

1,  232,  353 

7,  676,  504 

223,  992 

2, 466,  947 

2, 858, 082 

3, 186, 288 

1, 155, 138 

9,  666,  455 

-2, 119,  642 

2,  560,  879 

3, 448,  716 

3, 374,  705 

1, 401,  775 

10,  786,  075 

62,  674 

1,  672,  944 

2,  111,  424 

4,  412,  913 

1, 197,  301 

9, 394,  582 

3,  540,  749 

1, 179, 148 

915,  562 

4, 125,  039 

1,  642, 369 

7, 862, 118 

7, 133,  676 

822, 056 

1.  215,  231 

3, 848,  828 

1,  965,  538 

7, 851,  653 

3,  212,  445 

875,  424 

1, 189,  833 

4,  266,  583 

2,  387,  602 

8,  719,  442 

3, 106,  865 

712,  781 

1,  597,  500 

4, 148,  999 

4,  046,  954 

10,  506,  234 

3, 054,  459 

1,  224,  355 

1,  649,  641 

3,  723,  408 

3,  206,  213 

9, 803,  617 

5,  756,  314 

1, 288,  686 

1,  722, 064 

3, 369,  578 

1,  973,  823 

8,  354, 151 

8,  043, 868 

2, 900,  834 

1, 884, 068 

3,  428, 153 

1,  719,  437 

9,  932,  492 

7, 128, 170 

3, 345,  772 

2, 427,  759 

2,866,075 

1,  641, 142 

10, 280,  748 

-2,  507,  275 

2,  294,  324 

1,  654,  244 

2,  845, 428 

1,  362,  514 

8, 156,  510 

1,  227,  705 

2,  032,  828 

1,  965,  566 

2,  465,  733 

1,  594,  210 

8,  058,  337 

6, 365, 192 

11,  817,  798 

3,  959, 365 

2,  451,  273 

2,  052,  335 

20,  280,  771 

-10,479,638 

19,  652, 013 

6, 446,  600 

3,  599,  455 

1,  983,  784 

31,  681,  852 

-17,341,442 

20, 350,  807 

7, 311,  291 

4,  593,  239 

2,  465,  589 

34,  720,  926 

-23,  539,  301 

14,  794,  294 

8,  660, 000 

5,  754,  569 

3,  499,  276 

32,  708,  139 

-16,  979, 115 

16,  012, 097 

3,  908,  278 

7,  213,  259 

3,  453,  057 

30,  586,  691 

17,  090,  980 

8, 004,  237 

3, 314,  598 

6,  389,  210 

4, 135,  775 

21,  843,  820 

11,  255, 230 

5,  622,  715 

2,  953,  695 

6,  016,  447 

5,  232,  264 

19,  825, 121 

1,  760,  050 

6,  506, 300 

3,  847,  640 

5, 163,  538 

5,  946, 332 

21, 463,  810 

3, 139,  565 

2,  630, 392 

4,  387,  990 

5, 126,  097 

6, 116, 148 

18,  260,  627 

-379,  957 

4, 461,  292 

3,  319,  243 

6, 087,  274 

2,  942,  944 

15,  810,  753 

-1,237,373 

3,  HI,  981 

2,  224,  459 

5, 172,  578 

4,  491,  202 

15,  000,  220 

6,  232,  208 

3, 096,  924 

2,  503,  766 

4,  922,  685 

4, 183,  465 

14,  706,  840 

5,  833,  826 

3,  340,  940 

2,  904,  582 

4,  996,  562 

9, 084,  624 

20, 326,  708 

-945,  495 

3,  659,  914 

3, 049,  084 

4,  366,  769 

4,  781,  462 

15,  857,  229 

5,  983,  629 

3,  943, 194 

4,  218,  902 

3,  973,  481 

4,  900,  220 

17,  035,  797 

8,  224,  637 

3,  938,  978 

4,  263,  877 

3,  486, 072 

4,  450,  241 

16, 139,  168 

6, 827, 196 

4, 145,  545 

3,  918,  786 

3,  098,  801 

5,  231,  711 

16,  394,  843 

8,  368,  787 

4,  724,  291 

3, 308,  745 

2,  542,  843 

4,  627,  454 

15,  203,  333 

9,  624,  294 

4,  767, 129 

3,  239,  429 

1,  913,  533 

5,  222,  975 

15, 143,  066 

9,  701, 050 

4,  841,  836 

3,  856,  183 

1,  383,  583 

5, 166,  049 

15,  247,  651 

13,  279, 170 

5.  446,  035 

3,  956,  370 

772,  562 

7, 113,  983 

17,  288.  950 

14,  576,  611 

6,  704,  019 

3,  901.  357 

303,  797 

12, 108, 379 

23,  017,  552 

10,  930,  875 

5,  696,  189 

3,  956,  260 

202, 153 

8,  772,  967 

18,  627,  569 

3, 164,  367 

5,  759, 157 

3,  864,  939 

57,  863 

7,  890,  854 

17,  572,  813 

17,  857,  274 

12, 169,  227 

5,  807,  718 

12,  891,  219 
16,  913,  847 

30,  868,  164 
37,  243,  496 
33,  865,  059 

19,  958,  632 
-12,  289,  343 
-7,  562,  497 

13,  682,  734 

6,  646,  915 

12,  897,  224 

6, 131,  596 

i4,"997 

14,  821,'  242 

8,  916,  996 

6, 182,  294 

399,  834 

11,  400,  004 

26,  899, 128 

4,  583,  621 

7, 097,  070 

6, 113,  897 

174,  598 

10,  932,  014 

24, 317,  579 

-4, 837,  464 

8,  805,  565 

6, 001, 077 

284,  978 

11,  474,  253 

26,  565,  873 

-9,  705,  713 

6,  611,  887 

8,  397,  243 

773,  550 

9,  423,  081 

25,  205,  761 

-5,  229,  563 

2,  957,  300 

3,  727,  711 

523,  595 

4,  649,  469 

11,  858,  075 

-3,  555,  373 

5, 179,  220 

6,  498,  199 

1, 833,  867 

8,  826,  285 

22,  337,  571 

6,  983,  803 

5,  752  644 

6,  297,  245 

1, 040,  032 

9,  847,  487 

22,  937, 408 

7, 032,  698 

10,  792,  867 

6,  454,  947 

842,  723 

9,  676,  388 

27,  766,  925 

1,  933, 042 

38,  305,  520 

7,  900,  636 

1,119,215 

9,  956,  041 

57,  281,  412 

-30,  785,  643 

25,  501,  963 

9,  408,  476 

2,  390,  825 

8,  075,  962 

45,  377,  226 

-9,  641, 447 

14,  852,  966 

9,  786,  706 

3,  565,  578 

16,  846,  407 

45,  051,  657 

-13,843,614 

9,  400,  239 

7,  904,  709 

3,  782,  331 

18,  456,  213 

39,  543,  492 

4, 059,  947 

11,811,793 

9,  005,  931 

3,  696,  721 

23, 194,  572 

47,  709,  017 

4,  850,  287 

8,  225,  247 

8,  952.  801 

4,  000,  298 

23,  016,  573 

44, 194,  919 

5,  651,  897 

9,  947,  291 

10,  918,  781 

3,  665,  833 

23,  652,  206 

48, 184,  111 

13,  402,  943 

11,  733,  629 

10,  798,  586 

3,  071,  017 

32,  441,  630 

58,  044,  862 

15,  755,  479 

14,  773,  826 

13,  312,  024 

2,  314,  375 

29.  342, 443 

59,  742,  668 

5,  607,  907 

16,  948, 197 

14, 091,  781 

1,953,822 

36,  677, 226 

69,  671,  026 

4,485,672 

614359—62 


412   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  2. — Receipts  and  expenditures, 


Receipts 

Year' 

Customs 

(Including 

tonnage  tax) 

Internal 

revenue 

Other  re- 
ceipts ' 

Total 
receipts ' 

Net  re- 
ceipts 

Income  and 
profits  taxe.s 

Other 

1857 

$63, 875, 905 
41,789,621 
49,  565, 824 

53, 187, 512 
39,  582. 126 
49,  056, 398 
69,  059, 642 
102, 316. 153 
84, 928.  261 
179,046.652 
176,417,811 
164,  464.  600 
180, 048, 427 

194,  538. 374 
206,  270.  40S 
216, 370.  287 
188,  089,  523 
163. 103,  834 
157,  167,  722 
148,071.985 
130, 956.  493 
130,170,680 
137, 250, 048 

186,  .122. 064 
198, 159.  676 
220,410.730 
214,  706, 497 

195,  067,  490 
181,471,939 
192,  905,  023 
217,  286, 893 
219.091.174 
223, 832,  742 

229. 668,  585 
219,  522, 205 
177, 452. 964 
203,355.017 
131,818,531 
152,158,617 
160,021,752 
176.554,127 
149,575,062 
206, 128,  482 

233, 164,  871 
238,  585, 456 
254, 444,  70S 
284,  479.  582 
261,  274,  .565 
261, 798, 857 
300,  251,  878 

332,  233, 363 
286,113,1.30 
300,711,934 

333,  683,  445 
314,497,071 
311,321,672 
318,  891. 396 
292. 320.  014 
209,  786, 672 
213. 185,  840 
225,  962.  393 
179, 998. 385 
184, 457,  867 

322, 902,  650 
308,  564, 391 
356,  443, 387 
661,928,867 
545, 637, 504 

$5, 089,  408 

4,  865,  745 
3, 920, 641 

2,  877, 096 

1,  927,  805 

2,  931,  058 

5.  996,  861 
52,  569, 484 

39. 322. 129 
69.  759, 155 
48.  188,  662 
50. 085,  894 
32,  538,  859 

31,817.347 
33. 955. 383 
27, 094,  403 
31,919,368 
39,  465, 137 
20.  824,  835 
29.  323,  148 
31.819.518 
17,011,574 
23,  015,  526 

22.995,173 
27,358,231 
36,616,924 
38,860,716 

31,  866,  307 
29,720.041 

26,  728,  767 
35.  292,  993 
35.  878,  029 

32,  335, 803 

30, 805,  693 

27,  403.  992 

23,  513.  748 
21. 436.  988 
27. 425.  552 

29. 149. 130 
31,357.830 

24.  479.  004 
84,  845.  631 
36, 394, 977 

38,  748,  054 
41,919,218 
36, 153.  403 
46.591.016 
46,  908, 401 
48. 380, 087 
45.  582,  3.55 

63,  960,  250 
64. 037,  650 
57, 395, 920 

51,894,751 

64,  806, 639 

59.  675. 332 

60.  802.  86S 
62.312,145 
72,  454,  509 
56.  646,  673 
88,996,194 

298.5,50,  16S 
652,  514,  290 

966.631,164 
719.  942,  5S51 
539,  407.  507 
820,  733,  853 
671,250,162 

$68, 965, 313 
46, 655, 366 
53,486,465 

56, 064.  608 
41,509.931 
51, 987,  456 
112.697,291 
264,  626,  771 
333,714,605 

558. 032. 620 
490,  634, 010 
405,  638,  083 
370, 943,  747 

411,255,477 
383.  323,  945 
374.  106, 868 
333,  738,  205 
304,  978,  756 
288,  000.  051 
294.  095. 865 
281,406.419 
257,  763,  879 
273, 827, 185 

333,526,611 
360,  782, 293 
403,  525,  250 
398.  287,  582 
348.519,870 

323,  090,  706 
336,  439,  726 
371,403,277 
379.  266, 075 
387, 050, 059 

403, 080, 984 
392,  612,  447 
354,  937,  784 
385,  819,  629 
306,  355,  316 

324,  729, 419 
338.  142,  447 
347,721,705 
405. 321, 335 

515. 960. 621 

567, 240,  852 
587, 685,  338 
562.  478, 233 
561,880,722 
541, 087, 085 
544,  274,  685 
594,  984,  446 
665, 860, 386 
601,861,907 
604, 320, 498 

675,511,715 

701,832,911 

692,  609,  204 

724,111,230 

734.673,167 

697. 910. 827 

782,  534,  548 

1,124,324,795 

3,  664.  582,  865 

5,152,257,136 

6,  694,  565, 389 
5,  624,  932.  961 
4, 109, 104,  151 
4,007,135,481 
4,012,044,702 

1858 

1859 

1860                   -  - 

1861 

1862 

1863               

$2,741,858 
20.  294,  732 
60. 979. 329 
72.982.159 
66,014,429 
41.455.598 
34,  791, 856 

37,  775,  874 

19, 162,  651 

14,  436,  862 

5,  062.  312 

139.  472 

233 

588 

98 

$34, 898.  930 
89, 446,  402 
148, 484,  886 
236.  244.  654 
200.013.108 
149.631,991 

123,  564,  605 

147, 123,  882 
123, 935,  503 
116,205.316 
108.  667. 002 
102.270.313 
110.007.261 
116,700.144 
118.630.310 
110,581,025 
113,501,611 

124,  009,  374 
135,261.364 
146,  497,  .596 

144.  720.  369 
121,530.445 
112,498,726 
116,805.936 
118.823,391 
124.  296,  872 
130,  881,  514 

142,  606,  706 

145.  686.  250 
153,971.072 
161.027,624 
147.111,233 

143.  344,  541 

146.  762.  865 
146.  688,  574 
170,900,642 
273,  437, 102 

295,  327, 927 
307, 180,  664 
271,  880, 122 
230,810,124 
232.904.119 
234,095,741 
249, 150,  213 
269,  606,  773 
251,711,127 
246, 212, 644 

268,981,738 
289,  012,  224 
293. 028,  896 
309.410.666 
30S,  659.  733 
335,  467,  887 
387,  764,  776 
449, 684.  980 
872, 028. 020 
1,  296,  501,  292 

1,460.082,287 

1,390.379.823 

1, 145, 125, 064 

945, 865.  333 

953, 012, 618 

1864    .- 

1865 

1866 

1867    

1868 

1869 

1870 

1871        

1872 

1873 

1874     

1875 

1876 

1877    

1878 

1879 

1880 

1881     — 

3,022 

1882 

1883 

1884    .  .  

55,  628 

1885 

1886 

1887    

1888 

1889 

1890 

1891     .          

1892 

1893 

1894 

1895 

77, 131 

1896 

1897 

1898 

1899            .      .  - 

1900            

1901 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

20, 951,  781 
33,  516,  977 
28,  583, 304 
35, 006, 300 
71,381,275 
80,201,759 
124. 937, 253 
359,  681,  228 

2.  314,  006,  292 
3, 018,  783, 687 

3.  944,  949,  288 
3,206,046,158 
2,068,128,193 
1,  678,  607, 428 
1, 842, 144, 418 

1911 

1912 

1913 

1914 

1915 

1916 

1917 

1918 

1919 

1920 

1921 

1922 

1923 

1924 

See  footnote  at  end  of  table. 


TABLES 

413 

fiscal  years  1789-1961— Continued 

Expenditures 

Department  of 

Surplus,  or 

the  Army 

Department  of 

Interest  on  the 

Total  expendi- 

deficit (-)  6 

(formerly  War 

the  Navy  * 

public  debt 

Other « 6 

tures  ' 

Department)' 

$19,  261,  774 

$12,  747,  977 

$1,  678,  265 

$34. 107.  692 

$67,  795.  708 

$1,169,605 

25,  485,  383 

13,  984,  .551 

1,  567. 056 

33,148.280 

74,  185,  270 

—27,  529,  904 

23,243,823 

14, 642,  990 

2,  638,  464 

28,  545,  700 

69, 070,  977 

—16, 584, 512 

16, 409,  767 

11,514,965 

3, 177,  315 

32,  028,  551 

63,130,598 

—7, 065,  990 

22,  981, 150 

12,  420,  888 

4, 000, 174 

27,  144,  433 

66,  546, 645 

-25,036.714 

394,  368.  407 

42.  668.  277 

13,  190.  325 

24.534,810 

474.761,819 

—422,  774,  363 

599,298.601 

63.221,964 

24,  729.  847 

27,490,313 

714,740,725 

—602.  043.  434 

690.791.843 

85.  725.  995 

53,  685,  422 

35,119,382 

865.  322,  642 

—600,  695, 871 

1, 031,  323.  361 

122.612.945 

77,  397,  712 

66,221,206 

1,  297,  655,  224 

—963.840,619 

284,  449,  702 

43.324.118 

133.  067.  742 

59.  967,  855 

520,809.417 

37,  223,  203 

95.  224.  415 

31,034,011 

143.781.592 

87,  502,  657 

357,  542.  675 

133,  091,  335 

123.  246,  648 

25,  775.  503 

140,  424.  046 

87, 894, 088 

377,  340.  285 

28.  297,  798 

78,  501,  991 

20, 000,  758 

130,  694, 243 

93,  668,  286 

322, 865,  278 

48, 078, 469 

57,  655,  676 

21, 780,  230 

129, 235,  498 

100,  982, 157 

309, 653.  561 

101,601,916 

35,  799,  992 

19.431,027 

125,  576,  566 

111,369,603 

292,  177,  188 

91,146,757 

35,372.157 

21,249,810 

117,357,840 

103.  538.  156 

277.  517.  963 

96,  588,  905 

46,323.138 

23,  526.  257 

104.  750.  688 

115,745,162 

290,  345.  245 

43,  392,  960 

42,313,927 

30.  932,  587 

107,119.815 

122.  267,  544 

302,  633.  873 

2,  344.  883 

41, 120,  646 

21,497,626 

103.  093.  545 

108.911.576 

274,  623,  393 

13.  376.  658 

38, 070,  889 

18,  963.  310 

100,  243,  271 

107,823.615 

265,101,085 

28,  994.  780 

37,082,736 

14,  959,  935 

97, 124.  512 

92.  167,  292 

241,  334,  475 

40, 071.  944 

32, 154, 148 

17,365,301 

102,  500.  875 

84, 944,  003 

236,  964,  327 

20,  799,  552 

40,  425, 661 

15, 125, 127 

105, 327,  949 

106, 069, 147 

266,  947, 884 

6, 879,  301 

38,116,916 

13,  536,  985 

95,  757.  575 

120.231,482 

267, 642.  958 

65, 883, 653 

40,  466,  461 

15,  686,  672 

82,508,741 

122.051,014 

260,712.888 

100,  069.  405 

43,  570,  494 

15, 032. 046 

71,077,207 

128.  301.  693 

257,981,440 

145.543.810 

48,911.383 

15,283,437 

59, 160. 131 

142.053.187 

265.408.138 

132.  879.  444 

39,  429,  603 

17,292,601 

54,  578.  379 

132.  825,  661 

244.126,244 

104.  393.  626 

42,  670.  578 

16.021.080 

51,  386,  256 

150.149,021 

260.  226.  935 

63.  463.  771 

34,  324, 153 

13,907.888 

50.  580,  146 

143,  670.  952 

242,483.139 

93.  956,  587 

38,  561. 026 

15.141.127 

47,741.577 

166.  488,  451 

267,  932,  181 

103.  471, 096 

38, 522,  436 

16,  926.  438 

44,  715, 007 

167.  760,  920 

267.  924,  801 

111,341,274 

44, 435,  271 

21,378,809 

41,001,484 

192, 473, 414 

299,  288,  978 

87,761,081 

44,  582,  838 

22, 006,  206 

36, 099,  284 

215,  352,  383 

318,040,711 

85,  040,  273 

48,  720,  065 

26.  113,896 

37.547,135 

253.  392,  808 

365,  773.  904 

26. 838,  543 

46,  895,  456 

29, 174, 139 

23.378.116 

245.  575.  620 

345,  023,  331 

9,914,453 

49,641,773 

30,136,084 

27,  264,  392 

276.  435,  704 

383,  477,  953 

2,  341.  676 

54,  567,  930 

31,  701,  294 

27,841,406 

253.  414,  651 

367,  525.  281 

—61, 169.  965 

61,804,759 

28,  797,  796 

30,  978, 030 

244,614.713 

356,195,298 

—31,  465,  879 

SO,  830,  921 

27, 147,  732 

35.  385, 029 

238,  815,  764 

352,179,446 

—14,  036,  999 

48,  950,  268 

34,561.546 

37,791,110 

244,471,235 

365.  774. 159 

—18.  052.  454 

91,  992,  000 

58.  823,  985 

37,  585,  0,56 

254.  967.  542 

443.  368.  583 

—38,  047.  248 

229,  841, 254 

63,  942, 104 

39,  896, 925 

271,391,896 

605,  072, 179 

—89,111,558 

134,774,768 

55.  953. 078 

40,160.333 

289.  972.  668 

520, 800,  847 

46,  380  005 

144.615.697 

60.  506,  978 

32.  342.  979 

287,  151.  271 

524.616.925 

63,068  413 

112.272.216 

67.803,128 

29,108.045 

276.  050,  860 

485.  234,  249 

77,  243.  984 

118,629,505 

82.618,034 

28,  556.  349 

287.  202.  239 

517.006.127 

44.  874,  595 

165,199,911 

102.  956,  102 

24,  646.  490 

290,  857,  397 

583.  659,  900 

—42.  572.  815 

126, 093.  894 

117,550.308 

24,  590,  944 

299,  043.  768 

567,  278,  914 

—23,  004.  229 

137.  326. 066 

110,  474.  264 

24,  308.  576 

298. 093.  372 

570.  202.  278 

24,  782.  168 

149,  775,  084 

97, 128,  469 

24.481.158 

307,  744.  131 

579.  128,  842 

86.  731., 544 

175,  840,  453 

118, 037, 097 

21,  426,  138 

343,  892,  632 

659, 196,  320 

—57,  334.  413 

192, 486,  904 

115,546,011 

21, 803, 836 

363,  907, 134 

693,  743, 885 

—89, 423, 387 

189,  823,  379 

123,173,717 

21, 342,  979 

359, 276,  990 

693,617,065 

—18, 105,  350 

197, 199,  491 

119,937.644 

21,311,334 

352,  753. 043 

691,201,512 

10.631,399 

184, 122,  793 

135,591.956 

22,616,300 

347,  550,  285 

689. 881,  334 

2,  727,  870 

202,128,711 

133,  262, 862 

22, 899,  108 

366,  221,  282 

724,511,963 

—400,  733 

208,  349,  746 

139,  682. 186 

22, 863,  957 

364, 185,  542 

735,081,431 

—408,  264 

202.  160, 134 

141,835.6,54 

22,  902.  897 

393,688,  117 

760.  586, 802 

—62, 675,  975 

183,176,439 

153.8.'i3.  567 

22,  900.  869 

374.125.327 

734.  056,  202 

48.  478, 346 

377,  940,  870 

239.  632,  757 

24,  742.  702 

1,  335,  365,  422 

1,977.681,751 

-853.  356,  956 

4,  869,  955.  286 

1,  278,  840,  487 

189,  743.  277 

6,  358,  163,  421 

12.696,702,471 

—9,032,119,606 

9,  009, 075,  789 

2, 002, 310,  785 

619,  215.  569 

6,  884, 277, 812 

18,514,879,955 

—13, 362,  622, 819 

1,621,9.53,095 

736,021,456 

1,020,251,622 

3.025.117,668 

6,  403.  343,  841 

291,221,548 

1,118,076,423 

650,  373,  836 

999, 144,  731 

2.  348,  332,  700 

5,115,927,690 

509, 005,  271 

457,  756, 139 

476,  775, 194 

991, 000,  759 

1, 447,  075, 808 

3,  372,  607,  900 

736,  496,  251 

397,  050,  596 

333,  201,  362 

1, 055,  923,  690 

1.508,451,881 

3,  294, 627,  529 

712.  507, 952 

357, 016, 878 

332, 249, 137 

940, 602,  913 

1.418,809,037 

3. 048, 677,  965 

963, 366, 737 

414        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


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—  CO  CO  O  CM  CM  — 

OS  CD  to  — '  oc  — <  OS 
OS  CD  O  OS  00  r^  I  ~ 


— ICO        COCOC^ICOCM         CMCOiOtOtO        TftocOtOtOCDcD 


CO  CO  CO  00  CO      CO  lO  cr>  — <  CM 

CM  OS  00  00  00        O  O  CD  to  O 


OS  C  CS  CM  CO        O  to  lO  c 


CO  CO  r^  00  00 

CO  —  CM  l>.  CO 


cc  CO  OS  cc  CD 
to  ■*  ■*  OS  CM 

r-^oTio  GO  CM 

■*  t--.  Q  CD  O 
to  to  CD  to  CC 


JiOtOCO         to  —  tOOCCO         CTSI--- 


o  CO  t^  r^-* 

"cTco 

,  I  to  — I 

to  CO  CO  CM  CO 


CO  GO  CO  <• 

CO  cd  CDOs'od 
—  00  CO  to  — 

COCO  ■*  coco 


to  00  OS  CM  CM 

00  —  CO  * 

-*  OS  00  CM  _  , 
CO  CO  CO  CO  ^ 


CMCMOOC  CD 
**  t>-  CO  CM  OS 
to  O  CM  O  t- 

r-  r^r^  CM  cr 

h-TfO  t--* 
-^iO-S^— "rjT 
to  CO  OS  CM  OO 
CO  •*■*•*  CO 


OS  C^l  OS  CM  CO 
CM  *0  h^  00  — 

coo  CO  to  CD 


■*  CO  CD  00  to  OS  ■* 

CO  —  -^  o  —  r^  — 

CD  to  -*  00  CM  to  CM 


OS  OS  CD  O  —  CO  to 


CO  O  O -*  O  COOO*tO'*OI 

. —  -_     ,  -._.-.  ,  CM  ■*O~C0CM  CD -*  -*  Os" 00  CO  t-^ 

OJtO— I        — 'OOCOiO^H        M*OS00CMC0        toCOOSCMOO         C^lCMtO— iCO  OOtoCS'-rCMO 
— " ■-  —  -■'  —        ^cDtOCDtO  Ot~»t^t>.OS— iO 


lOCOr^OOOS        O  —  CMCO-*         lOCOr^OOOS        O— tCMCO-*         tOCOt^OOOi        o— 'C^ICO-*        tocot-oooso— i 
CMCICMCMCM         COCOCOCOCO         COCOCOCOCO         ■*■*■*■*■*         "if^^^rf-rt^  lOtOiOiOiO         lOiOiOtOtOCCO 

ososososos       Qsosososi^      Qsonososos       ososososos      cscsososo)      ososososos       asOSOJOSOS^(^ 


TABLES 


415 


CO  b-cD  »M  Oi 

»00  CO  OCO 

cc  00  r^  CO  t- 

CO  co'  '^'  CO  o 

Tt-  Tj<  O  QC  Ol 

o^oooco 

.'  to  lO  ctT  rfJ" 

■t  CO  to  :  — 

•  OOi-HC 


.-*  CO  to  CO  CO 


6^ 


OOOOOiOCO         OO^OOO  1— t  00  C^I  to  <-H  COOiO-^OO  h-.'^COh-CO  ^H  CO  Q  i-H  1-H  (N  00 

— 'OC'Oootj*       oco-— 'Oi'^  oiocoa::-^^  c^oo-^-^  loc-it-iot-  -.-. -^  .*--.«  ^■.-« 

00OI--OO         .-HOIt-iOO  rHCOt--COtO  r-^COOOCO  CO^OCO-^C 

cN"t--^oi'(M''-r      c^fci'oo'od  oT c^' 0-1  o C'f  cdo  h^o  cJ"  ci(M*oco*'o  ccco  -— '  "^  ^  t;;  ^ 

fCO-— I  0!NC3"^CO  OS'-'t^-^Tt*  r-«r-CO<NCs  CStOiOTt^CXOr-- 


O  00  !M  CO  CD 


-1-HtOi-tas         1— iTT-h-fOtM         000300CO 


CO  CO  CO  O  03 

t^  Tji  r^  CO  o 

I    M  tN'co" 

I  i  I 


Oi  (M  t^  t--  CO  _     ,  .  _ 

t-^  -^   t^  r-t  00  Ol  1-t  TT*  Tr<  Tp 


O  CO  CO  Oi  <— I 

-rf   r--  lO  --I   .— I 

Oi  CO  t-^'^  CO 

CO  o     odi-T 


,,_5cooico      otoioasco-^io 

,— iiOOTTi-l         i-hcO»O00tJ«C^00 


Or-itMcoto       cocoooa:o      ooc 


C-1  CO  -^  to  CD 
CO  C<)  t--  to  00 
CO  00  CO  00 '^ 

.  .   ■*  (M  CO  to 

1  CO  O  IM  00 

co't-^-^'co  00 
CO  o  r-  o  Oi 

000>-H  (N 

co"  cdci  CO  co" 


00  OCO  -H  rt* 

00  o  tooi  r- 


cc^  ■— I  to  ^ 


^  ^  t^(M  C^        Oi  t 


to  o  '^  (M  r^ 


>  t^  t^  Oi        CO  •-' 00  C^  O        CO  a>  CO  ■^  00        COtOOiCC'-H 


JCq  CO  to  Ol  o 


-C^iM-^Oi        Cl'^'^too        OiOCO>-<Cs        Ol-^CMOOCO        CDCitOOCOI-to 


r^  00  CO  00  CO 


M  rr '-* -^  CD        O  CD  O  CO  C^ 


O  t*05  00  -n^ 

'(T  l^  'O  Ol  -^i 

TT  to  CO  to  CO 

C0C0"'^'"'^'CD 


t--   !-•  CO   ■^   .-H 

OC<»COCO'^ 
"^  "^  I"-  t^  00 

tdodt^CD  00 


_ co-Tt^'— ir^o      r'-h-'^'^toiMr-- 

CO.— «o      co-^r^co—t      C000OC5O      cooi-— 'r-cot-ico 


to  Tf  CO  r^  CD 
to  tc  coco  00 

0(N  OCOCft 

oTco'^^'aT'^ 


CO  '^  r^co 
O:  OCO(N  Tt< 


0<NC^l-0        t^COCOi— iCO'^'-H 


(MCOCOtO'^  rfOCOOsr-  00  rt*  CD  O:  !N  O  to 

0<M(NiOr^  -rfit-O^CO  OO  C^  cO  CO '^  CO  <-< 

COCOOOi"^  lOOlCO'-HtO  COCMOlCOCOtOtO 

(y5"o  oo'c^foT  oTco  trf'^r-T  rr  co  oo<-ro  co  r-T 


Jt^Oi        Ol  CD  CO  CO  CO 


TfCDt^O        CO  CO  CD  !>■  00  t- 00 


J^OiOC^        CO-— '050CD         <— '-^(NCOO        OCicOC-lOO  COCOtOt^'-'C'lO 

'.-hcooci^       r^co<Ncocn       (NCi^to-n       coocooc^  OTfcocooi'CO 

-_.- .     . _        (M-^rcDcOOi  (MfNOO'MOcOI:^ 

CO  co*"co'as"<N  to  00  co'  h-'-^  oicf 

—  ■"  00  to  to  CO  t^  CO  Oi  o  t  ■" 


tM  CO  CO  CD  00   1^- r^  O  00  t 


^  00  O  CO    CO  to  —  »■ 


00  h-  00  Oi  CO 
to  I-  00  O  CO 
Oi  OOOi  Ol  CN 

co'  ^  CN  r-*"  r^ 
CI  t^  (N  cq  i-H 


ooco--ir^r-       _-._,.- —       - 

otoO'«9'to      C3toco-«rco      dcor-oiaioioi 


CO  I>  00  Oi  tM    CO  1— '  Ol  CO  tM    <N  t^  ^ -^  tO   i-i  lO  CO  CO  "^  CO  C 


<-H  CM  O  T-t  CO   t^  00  O  to  CO    00  .-H  C 


)  CO'  to  o:  to 


t-t  i-H  C^    »-l  CO  ^  »0  CO  CD  CO 


■■B.2. 
a  s 


^^1 


CM  CO -^  to  CO  -^  CO  to  00 -^ 
COC^lf^tOOO  0CO(NOto 
CO  00  CO  OO --^Jl        oooooooo 


to  Oi  C3  o  o 
^  — I  oco  r^ 

Oi  Oi  -^  !>■  to 


-^OlcOfMCO        OOiCDOO 


(N  t^  OOi-H  00 


tooiOTt*to      t^oor^cocOf-ios 


to  as      oi  •-<  r- oi  Ci      oitocooo-^      .-h  t-- oi  to  co  to  c 


-COCOOi-^         rH00O"^C^         00  »-H '■r  CO -^  ' 


(MCOOOr-Ht-^       o-^coooo       coo-^t^c 


0>— 'O-lcOtO         COCOOCOOi         cOOOtMCOtO        COOt^COO        .— tt^CiOOO         OCOOOtO 


(M  CO'  00  '-H  Ci  to  O 


CSrr(M00OO        Oi-^OOO-rf        OCSCOi-H 


COt^Oi         OOOtOCSCO         o:  t^  O --*  <N  CO  .-H 


CO  h-  -^  CO  00 
CD  05  I^-  O  OS 
O  OOi  r-.  (N 

coco  cT CO  CO 


TP  to  CO  CO  O 
coco  TPrjTtxT 


OCO  CO  --H  00 
(M  0:>  to  05  |0 
to  -^  t^  t--  00 

co'odt^cD'od 


Ol  (M  to  1^  OO        CO  l>-  (M  GO  C 

COcO'^OtO  ^ 'tf  CO  CO  c 


Oi  CO -^  Ci  to        00  O  O  CO  CI 


^  to  O  h-  t^ 

CO  otp  CM  r* 


O:  O;  CO  CO  t--  CO  Ci 
CO  CO  CO  CO  O  CO  o 


•rf  CD  Ol  <— I  O  t—  OJ 


r-H  CO  r- 03       Oi  O  CO  CO  CO       corrcot^co       co  co  co  t^  oo  t-^  oo 


■'CO 


OcOt^O"^         i-HCOTj-cOto         '^OiCM 


r-<  00  00 

"   ">  t-  _   , 

-  OOC^l  CO 

to  c?  co"  to*  c5 
t-  -T?"  QC  r^  c^i 

»-(   O0C5  i-H   O 

f  00  ctT  o 
_   _:o:  CO  "" 

^  to  -^  CO 


1-ioootoco      cococor^ 


CO  CM  oo  to 


OcOr^tCO  OiOcOOO       •^cd— »CO*^COOO 

--~.^^— -.w-  -, --         r-^-^OOOCM  OC-ICOOOCM         OiOOOtOCDCit^ 

i-HCOOC^l'^         OOt-^t^-^OS        OOCi-^ClO        COCSCJCD"^  CMCDOOIOO         tO^tOOOt^f-HCM 

CM*  rf  CO  CO*  od 
O  CO  O  OCO 
o:  O  .-H  to  t>- 


OOCR  00  CO  CO 

t^cooo 


i-H  en  CO  O -^        Oi  to  CO  r 


■^  ■^  r-  to  <-H 


coco         tOOOltOCD         t^COOlCOOJ         ■^COCMGOO         t--.f-<"^OCCt--CO 


00O:COCO  ■^O-lClTfCO         t~-C7lOCM'^  ClOlOOOOt--         cOl--Or^OO         C100.-<tOi— I  i-tOOCMO^tOi-H 


OS  r-  CM  1-H  CM 

i-Tcm'co'co'io 


lO  to  "^  to  05 

t^cn  OCM  -^ 
r-  to  t—  CO  to 

"^co'tO  ■^"co' 


■^  to  -^  o  t^ 
of  oT  o  to  CO 


i  ,-.  TT  O   Tf  O  I^  C 

5  -^  o   r-^  CO  cm'  c 


to  tOOl  '^  O  O  CM 
CM  to  to  CO  t^-'ci  t^ 


CM  to  CO  00  r-t      TT  to  o  r- Oi      CO  Oi  r- CM  o  o  »-< 

CD  to  oT-'J^'cd"       Tfi'cMOi'tOO        ot-^oi'coo        CMC0C0t0ci"r-*O 
1-t  .-(         .-H  .-(,—(  1-4  CM         03  .-<  T-(  CM  CM         CM  CM  CM  CM  CO  CM  CO 


43^ 


CMOOOCOO        CO'^.-'cDt—        COC^l'-H-^Tp         r~-CMCDCDCO         OOCO'^tOCD        "^CMt^ 
-      —        1-HOCOOCM         tOOCO'-^CO        Oli-iCOOlO        ■^OOOOCOCO         CO.— ICO 


CO  t>- CD  •— <  I— I        CO  GO  CO  t- r-         O  CO  CO  CO 


^ ._       _, ..  ,       t^cooocooto.— I 

OcOtTOOCO         OCO-^OCO         t-^OO-^O.— "COCO 


COr^Oi'^O        r^OiCOtOt^        COCO^j^OOl         lOCMtoOO         CCr^Olr-iCD        CO-^COOtO        1— 'COCO-^OiOOT-i 

OCO.— 'COCO      •^tor-.cOr-i      CMCJ500COCO      coasoocor-      ooioc^ioci      i-tiocoooco      coasosb-coco-rti 

00050r*CO        COtOCMCOcO         OiCOCOCMtO        OlcOO'-HOi         COO^Ol.— ICO        OOCMtOTT        COtO.— it-t^tcCM 

c5cd'^coo3*05'rC 

I--  00  "^  O  Oi  t^  to 
CO  b-  CM  CO  to  1-H  Oi 


,—,.—11^.— (CO        Ci.— 'OiOcO        OOicOcOO        OOOOO 


tOT-icnooto       CM-^coC'i'^ 


.-.  CO  O  O        *-<  CM  to 


O000t-»t^cO        CCcDiO<:Ot~*        OOt^COOiOS         O'-<C^00CD 


I^-  r-(  Oi 

,  .  to  .-I  CO 

CO  r-  Oi  CM  CO 

CO  ■^'^  to  to 


O  C-1  Ol  CO  CM 
rJH  »-(  to  O  00 
l>  CO  GO  toco 

lo  lO  io^ccTto" 


<©  CD  t^  t^  t^  Oi  00 


OQOCOCMCO  OOCM^iO'Tt^OO'^ 

OOCM-^tOOl  Tf^CMtOCOOOltO 

tOCOCOOiCO  CO  CD  O  to  "S*  CM  to 

orco'crTr^co  oor^'co  cjco-^s' cm 


I  CO  CO  O  rH  C-1   t- 


CO  ■'J^  C^l  CO  CM  '^  CM 


iTji         COCOCOCM-^         OCDOlOOCOCMI 


CMtotoooo      o-^cocoooccr^ 

ICO        toCOGOOCD  "'     — 

1^       CO  CD  of  to  to 


locr.  oi: 

-3-.^  CO  C 
■>  t^CO'- 
co'cDGCC 


II 


fi-s 


O  .— '  Ol  O  ■^        CO  00  CO  Oi  03 

^  — -~      -'j^oor^-'S* 


1-1  OCO  c^ 
o .— '  o  O    - 
O"^  o-<j<  o 

of  CO  cT  to 

Tt<  TP  O  CO  _ 
1-t  t^O  CO  to 

CD  C^'oOi-T-^Sh" 
,5ji  ^  ^  COCD 
CO  CO  CO  CO  CO 


OliO'^Tt*0        ClCOCDOit-*        COCOCOCDt'-         lOOlcOtOO 


jiOtOCMO        Os-^OO-^OSCMtO 


i^ 


D^-  CM 

r-t  t--  to  COOi 


-OCOOl         OltOt^Olt--        CO  t-- CO  CI  CM         lO-^COtO"^         1— tcooo-^otr 

<ot--co      tooiCsooo      1— icoO'-tOi      cooot^.— id      ocoo>'^r^r--o 
loc-f  Tf^'o  CM^     -^t^ccc^co      cm' cm" CO  cT to"      tood-^oco"      1— I  trdco  f^  CO  CO  i:^ 


OCOCD        COO'-'t-CM         COOOI--CMCM         OOtOQO'^cO         lOr-iO'-jO 


OCOO         »-<  .-I  CM  GO  to  00  Ol 


CMOOCD.— tt'-        ■^OtOCOCD        1— irt^CMCOt^        totOCMOOOO        COt^CMCMO-^CM 


■^COr^OlcD        CDOOCDCOCM         1— iCOOiOO-  

l-^totOrJHOi         COCMtOOir-         Olt—t^OCCO         -rfCOOiOOCO 
COCOCOCOCM        ^tOtOtocO        COCOtOOOto         —      ..---_- 


'^ coc  ""  ": 

0--I  tOCM'^S^ 
o  to  to -^-^ 


O:  CM  1-1  '*'  CM 

CM  coco  r-o> 

rH  00  CM  00  CM 

•^lO  Of-T 


1-H  CO  r- CO  o  CM  ■* 

CO  TP  O  1— I  CM  Tp  T-< 
t-  b- CO  Ci  I^- CD  CM 

ci"  Oi"  O  O  1-^  i-h"  CM 


^  2  "^  S 


^lOClCO-^    lO-^i-HOCO    O-^tOCM.-!    .-(OOOOCO 


to  .— Ol  CO  t^    05  ■rj*  Oi  o  c 


^,  ^^  ^,„         tOrf'OCMiO        CO-S'COOOS         OstO-^t^iO        00r-C0Tt4-<^OO 

CMi-<CJO0"^        i-tOOtOr-^        OOOO-^O        tOt-^COCO^'S^         OG0C0TtHTf-<*<t^ 


O^CMOCOS  .-(tO.-<COOO 

t:^0.-«cOrH  tOI--C000t^ 

O  Cft-^"05  t^"  co"  .-•" to  O  co"  to  t--"-'^  CO  CO"  O  CO  00  CI  o 

COOCi-iOO-^  tO-^OCJOO  oooocoto  co-^ococo 

03  O  .— I  Oi  Oi  00  1—1  CO  CO  to  OS  to  r-H  d  CM  »-*  O  to  tO  CO 

O-^'cT^OtO  rf^CDcO-^od  t~-rcdod-^"tO  t-^OC'to'iOcd        CDCOCMOOCi'       0:tOClTPtO 


t--OOOCOGO        COOOOt^OlCOO 


:  CO  to  03   CO  CO  T-(  CO  c 


^  t^^  toco 


-  CO  CO'  O  CI    CO  OC' 


OO  r-i  CI  rp  Ol    O  CO 


CiOOr-OlCO         OOCOtOtOi— I 


■^  ^^  Tp -^  ■^   -^  CO  CD  CO  CO   Oi  OJ  CO  to -^   -^  Oi  r-<  CO  CO   !>•  CO  rr  O  *0 

co'^'cfoi"   o  h^os't-^t-^   lOod  t^t^CO 


1-H  rfi  rj*    tOCM 


CO  o  00  r-  to  Oi  CI 
CO  CO  r^  CO  OC"  — 


O -^  tT  to  Tf  CO  CM 

to  r^  o  r-  GO  o:  o 
■^  CM  r-  tr^  CM  CM  1-1 

05  05  ^  05  O  O  »-H 


3  CO  t^  00  OS    O  1-1  CI 


to  CO  t-^  00  OS  O  1— I 


tOCOh-OOOS         Oi-fCMCO-^        lOcOt^COOs         O'-iCMCOtP         _,„.-„..         -_. -^  —  -„-^-ii-5t.-i 

CM  CM  CM  CM  CM    CO  CO  CO  CO  CO    CO  CO  CO  CO  CO    M* 'tj* '^ -rj* -rp    '-d^  Tf -^ 'tp '^    tO  lO  tO  ip  i£p    i2  12  i2  i2  ^2  S£  S 

05  OS  Oi  OS  OS   OS  OS  OS  OS  OS   OS  OS  OS  Os  Os   OS  OS  OS  OS  Os   OS  Os  OS  cn  OS   Os  OS  OS  Os  OS   Os  OS  Os  OS  OS  OS  OS 


416   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


(Footnotes  for  table  2.) 

'  From  1789  to  1842  the  fiscal  year  ended  Dec.  31;  from  1844  to  date,  on  June  30.  Figures  for  1843  are  for 
a  half  yeqr,  Jiin.  1  to  June  30. 

2  For  postal  receipts  and  expenditures,  see  table  21. 

3  Effective  Jan.  3,  1949,  amounts  refunded  by  the  Government,  principally  for  overpayment  of  taxes, 
have  l)een  reported  as  deductions  from  total  receipts  rather  than  as  expenditures.  Also,  effective  July  1, 
1948,  payments  to  the  Treasury,  principally  by  wholly  owTicd  Government  corporations  for  retirement 
of  capital  stock  and  for  disposition  of  earnings,  have  been  excluded  in  reporting  both  budget  receipts  and 
expenditures.  Neither  change  affects  the  size  of  the  budget  surplus  or  deficit.  Prior  year  figures,  lieginning 
with  fiscal  1931,  have  been  adjusted  accordingly  for  comparability.  For  adjustments  for  refunds  of  receipts 
and  capital  transfers  for  fiscal  1931  through  1948,  see  1956  annual  report,  p.  396,  footnote  3. 

^  Includes  all  expenditures  (both  military  and  civil)  by  the  Departments  of  the  Army  (including  these 
for  the  Panama  Canal),  the  Navy,  and  beginning  with  fiscal  1949  the  Air  Force,  except  the  civil  expendi- 
tures in  Washington  of  the  War"Department  and  the  Navy  Department  through  1915.  Department  of 
the  Army  expenditures  include  those  of  the  Department  of  the  Air  Force  (established  Sept.  18,  1947)  from 
funds  made  availalile  before  fiscal  1949.  Begiiming  with  1952,  Department  of  Defense  expenditures  not 
classified  undei  the  Departments  of  the  Army,  Navy,  or  Air  Force  are  included  under  "Other."  Beginning 
with  1960,  expenditures  for  "Mutual  Security,  Military  Assistance  Program"  formerly  classified  under 
"Funds  Appropriated  to  the  President,"  but  currently  classified  under  "Department  of  Defen.se,"  are 
included  in  "Other." 

5  The  practice  of  Including  statutory  debt  retirements  in  budget  expenditures  was  discontinued  effective 
with  fiscal  1948.  Such  expenditures  are  not  included  in  this  table,  nor  does  the  "Surplus  or  deficit"  take 
into  account  such  expenditures.    Table  40  shows  details  of  statutory  debt  retirements. 

Table  3. — Transfers  to  trust  funds  and 
[On  ba.sis  of  daily  Treasury  statements  through  1952;  thereafter  on  basis  of  "Monthly  Statement 


Transfers  to  trust  funds  i 

Fiscal  year 

Federal  old-age 

and  survivors 

insurance  trust 

funds 

Federal 
di.sabihty 
insurance 
trust  fund  * 

Highway 
trust  fund  s 

Railroad 
retirement 
account  ^ 

Unemploy  - 

ment  trust 

fund? 

Total 
transfers 
to  trust 
accounts 

1931 

1932 

1933 

1934 

1935 

1936 

1937 

$265,  000, 000 

387, 000, 000 

503,  000,  000 

550,  000,  000 

688. 140,  728 

895,  618, 839 

1, 130,  495,  201 

1, 292, 122,  434 

1,309,919,400 

1,238,218,447 

1,4.59,491,921 

1,616,162,044 

1,690,295,705 

2, 106,  387,  806 

3, 119,  536,  744 

3,  568,  556.  584 
4, 086,  293,  392 

4,  537, 269, 800 

5,  039,  572,  594 
6, 336,  804,  603 

6,  301, 190,  673 
6, 870, 361, 660 
7,157,673,750 
9, 271,  868, 378 

10, 623,  470,  762 

$265,  000,  000 

533,  402,  587 

610,  097,  413 

670,  650,  000 

812, 490,  728 

1,036,468,839 

1, 345. 296, 201 

1,  548, 479,  777 

1,596,224,782 

1,  493.  703,  701 
1,715,917,175 
2. 338.  753,  695 
2,240,414,065 

2.  656.  220.  526 
3, 694,  527,  792 
4, 306, 218,  612 

4,  706,  252,  235 
,5,140,311,374 

5,  638,  464, 120 

6,  971,  066, 460 
8,729,312,174 

10,424,150,452 
10,  700,  590,  420 
13,  459, 913,  934 
15,  425,  593. 101 

1938 

$146, 402,  587 
107,  097,  413 
120, 650, 000 
124, 350, 000 
140, 850. 000 
214, 801, 000 
256, 357, 343 
286, 305, 382 
255,  485, 254 
256, 425,  254 
722,591,651 
550,118.361 
549,  832,  720 
574,991,049 
737,  662,  028 
619, 958,  843 
603, 041, 574 
598,891,526 
634,261,857 
615,919,876 
574,  898, 971 
525. 219,  764 
606,  864, 657 
570,  712, 927 

1939 

1940 

1941 

1942 

1943 

1944 

1945 

1946 

1947 

1948 

1949 

1950 

1951 

1952 

1953 

1954 

1955 

1956 

1957 

.$333, 276,  575 
862,861,610 
846,  681,  036 
938,  681,  781 
962. 812,  408 

$1,478,925,050 
2,116,028,211 
2,171,015,864 
2,642,499.118 
2, 923,  240,  922 

1958 

1959 

1960 

1961 

$345, 356,  083 

'Represents  tax  receipts  transferred  and  appropriated  to  the  respective  trust  accounts. 

2  Refunds  of  principal  only;  the  interest  is  included  in  expenditures. 

'  .\mounts  appropriated  to  the  Federal  old-asre  and  survivors  insurance  trust  fund  are  enuivalent  to  the 
amounts  of  taxes  collected  and  deposited  for  old-age  insurance.  Amounts  transferred  currently  for  appro- 
priation to  the  trust  fund  are  based  on  estimates  of  old-age  insurance  tax  receipts  made  by  the  .'-ecretary  of 
the  Treasury  (42  U.S.O.  401(a)),  and  area'ljusted  in  laler  transfers  on  the  basis  of  wage  and  self-employment 
income  records  maintained  in  the  Social  Security  Administration.  Tax  refunds  are  reimbinsed  to  the 
general  fund  by  the  trust  fund  (42  U.S.C.  401(g)(7.)). 

*  The  Federal  disability  insurance  trust  fund  was  established  by  the  Social  Security  Act  .\mendments  of 
1956,  approved  Aug.  1,  1956  (42  U.S.C.  401  (b)).  The  act  appropriated  to  the  trust  fund  amounts  equivalent 
to  specified  percentages  of  the  wages  and  self-employment  income,  respectively,  which  are  ta^ed  for  old-age 
insurance,  and  provided  that  the  amounts  appropriated  should  !>e  transferred  from  time  to  time  to  the  trust 
fund  on  the  same  basis  as  transfers  to  the  Federal  old-age  and  survivors  insurance  trust  fund.  Kates  of 
tax  were  increased  by  the  percentages  appropriated  to  the  P'ederal  disability  Insurance  trust  fund,  the 
increase  being  applicable  to  wages  paid  and  taxable  years  be?inning  after  Dec.  31,  1956.  Tax  refunds  are 
reimbursed  to  the  general  fund  bv  the  trust  fund  (42  U.S.C.  4.'d(g)(z)). 

5  The  Highway  Revenue  .-Vet  of  1956,  approved  June  29,  1956  (23  U.S.C.  120,  note),  established  a  highway 
trust  fund  from  which  are  to  be  made,  as  provided  by  appropriation  acts.  Federal-aid  highway  expenditures 
after  June  30,  1956,  and  before  July  1,  1972.    The  act  appropriated  to  this  fund  amounts  equivalent  to 


TABLES 


417 


6  Inrludes  the  tonnage  tax  through  1931.    Beginning  with  1932  the  tonnage  tax  has  been  covered  into  the 
general  fund  as  mis'^ellaTieous  receipts  and  is  included  in  this  table  in  "Other  receipts." 
'  Transfers  to  trust  funds  and  refunds  of  receipts.     For  content  see  table  3. 

8  For  content  see  tabic  5.    See  also  "  Bases  of  Tables." 

9  Sec.  lH(f)  of  the  Economic  Cooperation  Act  of  1948,  approved  Apr.  3,  1948,  required  that  the  sum  of 
$3,000,000,000  be  transferred  to  a  trust  fund  entitled  "Foreign  Economic  Cooperation  Trust  Fund"  and 
"considered  as  expended  during  the  fiscal  year  1948,  for  the  pirpose  of  reporting  governmental  expendi- 
tures." The  effect  of  this  was  to  charce  the  budget  in  fiscal  1948  for  expenditures  made  in  fiscal  1949,  with 
consequent  effect  on  tlie  budget  surplus  or  deficit  of  those  years.  Tliis  bookkeeping  transaction  had  no 
effect  on  the  actual  timing  of  either  receipts  or  expenditures.  In  order  to  simplify  comparison  of  figures  be- 
tween years,  the  transactions  shown  in  this  table  do  not  take  into  account  the  transfer  of  $3,000,000,000  in  fiscal 
1948  to  the  Foreign  Economic  Cooperation  trust  fund;  expenditures  of  $3,000,000,000  during  fiscal  1949  from 
the  Foreign  Economic  Cooperation  trust  fund  are  treated  as  budget  expenditures  in  this  table.  If  efifect 
Is  given  to  sec.  114(f)  of  the  Economic  Cooperation  Act  of  1918,  the  budget  results  for  the  fiscal  years  1948 
and  1919  would  be  as  follows: 

Fiscal  year  1948    Fiscal  year  191,9 

Budget  receipts. $41, 374, 701, 989    $37,  6fi2, 972.  939 

Budget  e.xpenditures 35, 955,  232, 145      36, 474, 412, 987 

Budget  surplus 5, 419, 469, 844        1, 188, 559, 952 

11  Bceinning  with  the  fiscal  year  1951 ,  investments  of  whoUy  owned  Government  corporations  in  public 
debt  securities  are  excluded  from  budget  expenditures  and  Included  with  other  Investments  under  "Trust 
account  and  other  transactions."    See  tables  8  and  12. 


refunds  of  receipts,  fiscal  years  1981-61 

of  Receipts  and  Expenditures  of  the  United  States  Government,"  see  "Bases  of  Tables"] 


Refunds  of  receipts  2 

Total 

Internal  revenue  * 

Customs 

Other 

Total  refunds 
of  receipts 

$52,  561,  657 

$21,369,007 

$151. 045 

$74. 081,  709 

$74,081,709 

64, 528,  539 

17,202,969 

80.  813 

81,812.320 

81,812,320 

45, 814,  734 

12, 576, 842 

92,  224 

58. 483.  799 

58, 483,  799 

37, 195, 935 

14.046,350 

43, 853 

51.280.138 

51,286,138 

49,  747,  858 

20. 715,  688 

89, 811 

70.553,357 

70,  553. 357 

32,914,628 

14.085,195 

20, 103 

47, 019, 926 

47, 019, 926 

33,  405, 891 

16. 549,  408 

34, 242 

49, 989,  542 

314. 989,  542 

76, 842,  701 

16.156.340 

38, 437 

93, 037, 478 

626,  440. 065 

44, 684. 686 

16.  678.  803 

63, 194 

61,426.683 

671.  524, 096 

61, 154,  655 

17. 500. 945 

49, 295 

78.  704. 894 

749, 354,  895 

52, 802, 242 

27, 331, 472 

55.  755 

80. 189. 469 

892,  680. 197 

65, 192, 248 

19, 495, 861 

87.  429 

84.  775, 537 

1,121,244,376 

53,834,008 

16,  404, 512 

86. 888 

70,  325, 408 

1,415,621,609 

242, 856,  877 

14, 200,  774 

196.  617 

257. 254. 269 

1,805.734.046 

1, 664,  545,  567 

13, 843.  208 

389. 150 

1.678.777.924 

3, 275. 002,  706 

2, 957, 114, 348 

11.224.891 

4. 688,  639 

2. 973. 027, 879 

4, 466.  731. 580 

2, 982, 487, 490 

17. 480. 263 

6. 122.  643 

3.006.090.396 

4,  722, 007,  571 

2,250,391,383 

19.050.115 

2, 433, 279 

2.271,874.777 

4, 610, 628,  472 

2.817,005,313 

17.173,186 

3, 363.  506 

2. 837,  542, 006 

5,  077,  956,  071 

2, 135, 455, 950 

16.091.134 

7, 959, 405 

2, 159.  506. 489 

4,815,727,015 

2, 082, 431,  536 

15.324.391 

8, 774,  689 

2, 106.  530, 616 

5,801,058,408 

2,275,188,233 

17. 520, 381 

9,  497,  810 

2, 302, 206, 394 

6. 608,  425, 006 

3, 094,  7F8, 198 

16.949.064 

6, 091, 123 

3,117,838,385 

7, 824, 090, 621 

3. 345, 495,  593 

20.481.971 

11,259,808 

3, 377. 237, 372 

8,  517,  548,  748 

3. 399, 978, 359 

21.619,848 

4. 389, 417 

3. 425. 987. 624 

9,064,451,745 

3, 652,  611, 883 

23. 176. 262 

8, 241, 988 

3.684.030.133 

10,  655. 096, 592 

3,894,119,614 

19, 907,  757 

3,315,117 

3, 917, 342,  488 

12. 646. 6,54,  662 

4,  412, 603,  597 

17, 837, 948 

2,191,001 

4, 432, 632, 546 

14, 856, 782, 998 

4, 907, 159, 180 

23, 220, 638 

3,043,107 

4.  933. 422, 926 

15,634,013.346 

5, 024, 470, 807 

18, 483. 391 

1, 897. 066 

5,044,851,264 

18.  504.  765. 198 

5,  724,  670, 459 

25,  439,  532 

2, 260,  573 

5.  752,  370,  561 

21.177,963,665 

specified  percentages  of  receipts  from  certain  excise  taxes  on  motor  fuels,  motor  vehicles,  tires  and  tubes, 
and  use  of  certain  vehicles,  and  provided  that  the  amounts  appropriated  should  be  transferred  currently 
to  the  trust  fund  on  the  basis  of  estimates  by  the  Secretary  of  the  Treasury  with  proper  adjustments  to  be 
made  in  subsequent  transfers.  The  u.se  tax  was  imposed  by  tlie  act  and  rates  were  increased  for  the  other 
taxes.  Tax  refunds  are  reimbursed  to  tlie  general  fund  by  the  trust  fund  (23  U.S.C.  120,  note)  (sec.  209(f)(4) 
of  the  act  of  June  29,  1956).  Prior  to  fiscal  1957  corresponding  excise  tax  receipts  were  included  in  net 
budget  receipts  and  Federal-aid  highway  expenditures  were  included  in  budget  expenditures. 

'  Amounts  are  appropriated  to  tiie  railroad  retirement  account  equal  to  the  amount  of  taxes  under  the 
Railroad  Retirement  Tax  Act  deposited  in  the  Treasury,  less  refunds,  during  each  fiscal  year  (65  Stat.  222 
and  66  Stat.  371)  and  transfers  are  made  currently.  Excludes  the  Government's  contribution  for  creditable 
mihtary  service  from  1944  tiirough  19.54  (45  U.S.C.  228C-l(n)). 

7  The  Employment  Security  Act  of  1960,  approved  September  13.  1960  (74  Stat.  970)  established  in  the 
unemployment  trust  fund  an  administration  account,  and  appropriated  for  credit  to  that  account,  begin- 
ning with  the  fiscal  year  1 961,  amounts  equivalent  to  taxes  collected  and  deposited  under  the  Federal  Unem- 
ployment Tax  Act.  From  that  account  are  to  be  paid  the  administrative  expenses  of  the  employment 
security  program.  Previously,  the  corresponding  amounts  were  included,  respectively,  in  budget  receipts 
and  budget  expenditures.    Refunds  of  taxes  are  reimbursed  from  the  administration  account. 

8  Amo'ints  shown  have  been  reduced  by  refunds  of  taxes  reimbursed  from  the  Federal  old-age  and  sur- 
vivors insurance,  Federal  disability  insurance,  and  highway  trust  funds;  and  from  the  Federal  Unemploy- 
ment Tax  Act  in  1961.   Refunds  by  States  for  the  latest  year  are  shown  in  table  18. 


418   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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Reconstruction  Finance  Corporation  * 

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Tennessee  Valley  Authority 

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guaranty  fund 

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Federal  National  Mortgage  Association 

Office  of  the  Secretary: 

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surance   fund 

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Canal  Company  fund..  

Department  of  Health,  Education,  and  Welfare,  Bu- 
reau of  Federal  Credit  Unions 

Department  of  the  Interior: 

Colorado  River  Dam  fund,  Boulder  Canyon  proj- 
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Virgin  Islands  Corporation... 

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458   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  6. — Public  enterprise  revolving  funds,  receipts  and  expenditures  for  fiscal 
year  1961  and  net  1960  and  1961 

[In  thousands  of  dollars.    On  basis  of  "Monthly  Statement  of  Receipts  and  Expenditures  of  the  United 
States  Government,"  see  "Bases  of  Tables"] 


Fiscal  year  1961 

Fiscal  year 
1960 

Classification 

Receipts 

Expendi- 
tures 

Net 
receipts(— ), 
or  expend- 
itures 

Net 
receipts(-). 
Of  expend- 
itures 

Executive  Office  of  the  President: 

Ofllce  of  Civil  and   Defense   Mobilization,   civil 
defense  procurement  fund .     _     ...      .     ... 

184 

120 

-64 

—70 

Funds  appropriated  to  the  President: 
Expansion  of  defense  production 

93, 643 

17, 420 
1,673 

81,247 

275, 834 
(*) 

-12,396 

258, 414 
-1,673 

130,268 
202, 352 

Mutual  security  economic  assistance: 

Development  Loan  Fund .  . 

Foreign  investment  guaranty  fund 

—  1,356 

Total  funds  appropriated  to  the  President 

112,736 

357,081 

244,345 

331, 263 

Independent  offices: 

Atomic  Energy  Commission,  defense  production 
guarantees .-    

—12 

Export-Import  Bank  of  Washington 

544, 247 

581, 637 

37,390 

—323, 180 

Farm  Credit  Administration: 

Federal  Farm  Mortgage  Corporation  fund 

Federal  intermediate  credit  banks  investment 
fund  .  -.-  .... 

1,742 

5 

5,500 
50 

-1,736 

5,500 
-1,590 
-8,052 

-1,671 
6,250 

Production  credit  associations  investment  fund. 

1,640 
8,052 

-1,445 
—8, 460 

Total  Farm  Credit  Administration 

11,434 

5,555 

-5, 879 

—  5,326 

Federal  Home  Loan  Bank  Board: 

Federal  Savings  and  Loan  Insurance  Corpora- 
tion fund      -  - .  . 

60,820 
10,715 

25, 628 
10, 807 

-35, 192 
93 

—20, 426 

Other - 

259 

National  Science  Foundation  ... 

-2 

Saint  Lawrence  Seaway  Development  Corporation. 
Small  Business  Administration         ..  . .. 

3,674 
143, 060 
271,992 

2,822 
224,460 

6,151 
238, 673 
310, 684 

7,309 
355, 570 

2,477 
95, 613 
38, 691 

4,487 
131.110 

6,122 
54, 593 

Teimessee  Valley  Authoritv..    .  

11,848 

United  States  Information  Agency 

2,187 

Veterans'  Administration  ... 

187. 448 

Total  independent  ofTices ... 

1,273,225 

1,542,016 

268, 791 

-86.488 

General  Services  Administration: 

Defense  materials  activities      

725 
2,099 

72 
235 

-653 
-1,864 

-1.781 

General  activities 

-1.677 

Total  General  Services  Administration 

2,824 

306 

-2,518 

-3. 458 

Housing  and  Home  Finance  Agency: 
Office  of  the  Administrator: 

College  housing  loans     .  

38, 761 
88, 136 
S3, 643 
11,976 

236, 936 
514 

228, 181 
21,931 

16, 000 
854,333 
165,  729 
296, 731 
294, 246 
287, 089 

198. 175 

-87, 622 

144, 538 

9,955 

16, 000 

201.314 

Liquidating  programs 

-77,629 

Urban  renewal  fund 

105, 074 

Other 

11,946 

Federal  National  Mortgage  Association: 

Subscription  to  capital  stock,  secondary  mar- 

854,333 
240, 177 
163, 044 
301,  476 
132, 083 

-41,531 

Management  and  liquidating  functions  fund... 

-74,448 
133, 687 
-7,230 
154,986 

-437,220 
448, 992 

Federal  Housing  Administration    .                .        . 

-53,312 

139, 925 

Total  Housing  and  Home  Finance  Agency 

1,913,630 

2,401,670 

488,040 

297,560 

Agriculture  Department: 

Commodity  Credit  Corporation: 

Price  support,  supply,  and  related  programs, 

2,764,510 

143, 789 
17,413 

27,962 
24, 465 

4,182,038 

2, 132, 870 
10,613 

29, 438 
18,321 

1,417,529 

1,989,081 
-6,801 

1,475 
-6,144 

1,561,391 

Special    activities    financed    by    Commodity 

1,685,868 

Federal  Crop  Insurance  Corporation 

-2,363 

Farmers'  Home  Administration: 

Disaster  loans,  etc  ,  revolving  fund 

-17,785 

Farm  tenant-mortgage  insurance  fimd 

6,815 

2.978,140 

0,373,280 

3,395,141 



3,233,925 

Footnotes  at  end  of  table. 


TABLES 


459 


Table  6. 


-Public  enterprise  revolving  funds,  receipts  and  expenditures  for  fiscal 
year  1961  and  net  1960  and  1961 — Continued 

[In  thousands  of  dollars] 


Fiscal  year  1961 

Fiscal  year 
1960 

Classification 

Receipts 

Expendi- 
tures 

Net 
receipts  (—), 
or  expend- 
itures 

Net 
receipts(— ), 
or  expend- 
itures 

Commerce  Department: 

8 

9,513 

3 

1 

7,253 

3 

-7 
-2,260 

-1 

-1,565 

Inland  Waterways  Corporation 

-875 

Total  Commerce  Department 

9,525 

7, 257 

-2. 268 

-2,441 

Defense  Department: 
Military  functions: 

62, 709 

522 

1,839 

101,446 

497 

1,702 

38, 738 

-25 

-137 

22, 796 

-137 

Navy 

-280 

Total  military  functions 

65, 070 

103,  646 

38. 576 

22, 379 

Civil  functions: 
Army: 

Panama  Canal  Company..   ..      

103,033 
273 

527 
7.910 

108, 936 

31 

47 

7,366 

5,902 
-243 
-480 
-544 

-2, 175 

58 

937 

Air  Force  defense  production  guarantees 

-973 

Total  civil  functions . 

111,744 

116,379 

4,636 

-2, 153 

Total  Defense  Department 

176, 813 

220, 025 

43,212 

20, 226 

Health,  Education,  and  Welfare  Department: 

Public  Health  Service,  operation  of  commissaries, 

242 
3,575 

233 
3,436 

-9 
-139 

-8 

Social  Security  Administration,  operating  fund. 
Bureau  of  Federal  Credit  Unions 

-171 

Total  Health,  Education,  and  Welfare  De- 
partment  

3,817 

3,669 

-148 

-179 

Interior  Department: 

Bureau  of  Indian  Affairs: 

2,984 
3 

2,609 
1,759 

10,014 

1,177 

36 
2,648 
17,150 

3,250 
4 

1,062 

58, 738 

10, 956 

2,349 

2 
6,132 
17,041 

266 
1 

-1,547 
56,979 

941 

1,172 

-34 
3,484 
-109 

856 

7 

Bureau  of  Reclamation: 

Fort  Peck  project,  Montana          

-1,781 

32,032 

Bureau  of  Mines,  development  and  operation  of 

91 

Fish  and  WUdlife  Service,  Bureau  of  Commercial 

626 

Office  of  Territories,  loans  to  private  trading  enter- 
prises, Trust  Territory  of  the  Pacific  Islands 

-77 
168 

Alaska  Railroad  revolving  fund 

-217 

Total  Interior  Department 

38, 381 

99, 533 

61, 152 

31,705 

Labor  Department: 

Advances  to  employment  security  administration 

252, 910 
3,474 

301, 500 
2,686 

48, 590 

-788 

Farm  labor  supply  fund 

-2,067 

Total  Labor  Department 

256, 385 

304, 186 

47, 801 

-2,C67 

Post  OflSce  Department,  postal  fund 

3, 482, 961 

4, 347, 946 

864,985 

487,616 

Treasury  Department: 
Office  of  the  Secretary: 

Reconstruction  Finance  Corporation  liquida- 

4,910 
163 

1 

217 

958 
25 

87 

228 

-3, 952 
-137 

86 

11 

-14, 267 

Civil  defense  program  fund                ..  

-145 

Bureau  of  Accounts,  Government  losses  in  ship- 

36 

Office  of  the  Treasurer,  check  forgery  insurance 
fund .  

-3 

Total  Treasui-y  Department 

5,291 

1,299 

-3, 992 

-14,379 

Total  public  enterprise  funds 

10.253.911 

15.  658.  388 

5,404.476 

4, 293, 212 

*Less  than  $500.  '  Residual  of  gross  receipts  and  expenditures  after  reduction  for  certain  costs  which 
are  included  in  amounts  shown  for  special  activities. 

2  Includes  certain  costs  transferred  from  price  support  operations  for  which  expenditures  may  have  been 
made  in  prior  years. 

Note.— This  table  supplies  receipt  and  expenditure  data  for  public  enterprise  funds  included  in  table  4 
on  a  net  basis. 


614359—62- 


-30 


460   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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Table   11. — Trust  enterprise  revolving  funds,   receipts  and  expenditures  for  fiscal 
year  1961  and.  net  for  fiscal  year  1960 


[In  thousands  of  dollars. 


On  basis  of  "Monthly  Statement  of  Receipts  and  Expenditures  of  the  United 
States  Government,"  see  "Bases  of  Tables"] 


I 


Fiscal  year  1961 

Fiscal  year 
1960 

Classification 

Receipts 

Expend- 
itures 

Net  re- 
ceipts (— ), 

or  ex- 
penditures 

Net  re- 
ceipts (— ), 

or  ex- 
penditures 

Independent  offices: 

Civil  Service  Commission: 

Employees  health  benefits  fund -  _ 

296,243 

190, 902 

1,625 

201 

8,691 
592 

870, 333 
1,555,457 

12, 151 

115 
4,502 
2,202 

272, 979 

139, 978 

2 

209 

9,013 
543 

854, 333 
1, 482,  559 

12, 178 

123 
7,329 
2,210 

-23, 263 

-50, 924 

-1,623 

8 

322 
-49 

'  -16,000 
-72, 898 

27 

8 

2,826 

8 

Employees' Ufe  insurance  fund __  

-44,045 

Retired  employees  health  benefits  fund 

Federal  Communications  Commission: 

International  telecominimieations  settlements.. 

National  Capital  Housing  Authority: 

Operation  and  maintenance,  properties  aided 
by  Public  Housing  Administration 

-10 
2,580 

General  Services  .Administration: 

Records  activities,  National  Archives  trust  fund 

Housing  and  Home  Finance  Agency: 

Federal  National  Mortgage  .^.ssociation: 

Loans  for  secondary  market  operations  ' 

Other        

-39 

41,531 
940,  472 

Department  of  Agriculture: 

Farmers'  Home  Administration: 

State  rural  rehabilitation  funds _ 

2,261 

Department  of  Defense,  civil: 

United  States  Soldiers'  Home: 

United  States  Soldiers'  Home  revolving  fund—. 
Department  of  Justice: 

AUen  property  activities          

-8 
4,620 

Federal  Prison  System: 

Commissary  funds.  Federal  prisons            - 

26 

Total  trust  enterprise  funds       -  — 

2,943,013 

2,  781, 456 

-161,557 

9.53, 389 

1  The  Association  exchanged  preferred  stock  in  the  amount  of  $16,000,000  for  notes  in  the  same  amount 
held  by  the  Secretary  of  the  Treasury  (12  U.S.C.  1719). 

Note. — This  table  suppUes  receipt  and  expenditure  data  for  trust  enterprise  fimds  included  in  table  7  on 
a  net  basis. 


478    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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482 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table    13. —  Trust  account  and  other  transactions   by   major  classifications,  fiscal 

years  1952-61 

[111  millions  of  dollars.  On  basis  of  daily  Treasury  statements  for  1952.  Beginning  with  fiscal  year  1953 
on  basis  of  the  "Monthly  Statement  of  Receipts  and  E.xpenditures  of  the  United  States  Government," 
see  "Bases  of  Tables"] 


Classification 


1952 


1953 


1954 


1955 


1956 


1957 


1958 


1961 


11,910 

1,093 

1,051 

3, 805 

668 

58 

2, 033 

2,925 

779 


TRUST  ACCOUNTS,  ETC. 

Receipts 

Federal  old-age  and  survivors  insurance 
trust  fund 

Federal  disability  insurance  trust  fund.. 

Railroad  retirement  account 

Unemployment  trust  fund 

National  service  life  insurance  fund 

(rovernment  life  insurance  fund 

Fe<l('nil  employees'  retirement  funds  '-_. 

Iligluvuy  trust  fund 

Other  trust  funds  and  accounts  ^ 


3,932 


4,516 


;,586 


7,003 


850 

1,643 

786 

87 

912 


742 

1,594 

637 

79 

961 


59^ 


401 


737 

1,492 

6!9 

78 

691 

457 


700 

1,425 

590 

78 

708 


739 
1,  728 

649 

73 

1,025 


419 


467 


7,159 
339 
723 

1,912 
608 
69 

1,397 

1,482 
681 


7,900 
943 
695 

1, 855 

640 

67 

1,458 

2,134 
638 


8,182 
938 
758 

1,997 

634 

63 

1,741 

2,185 
•585 


10, 439 

1,071 

1,403 

2,703 

643 

61 

1,766 

2  2, 644 

711 


Subtotal  receipts 

Deduct:  Certain     trust     receipts 
which  are  also  expenditures  < 

Net  receipts 


8,807 
3 


9,155 
18 


9,536 
16 


11,685 
12 


14, 369 
10 


16, 329 
11 


17, 084 
135 


221,442 
908 


24,322 
515 


8,804 


8,922 


9,137 


9, 521 


11,673 


14, 359 


16,319 


16, 950 


20,  534 


Expenditures 
(Except  net  investments) 

Federal  old-age  and  survivors  insurance 

trust  fund  5 

Federal  disability  insurance  trust  fund.. 

Railroad  retirement  account 

Unemployment  trust  fund 

National  service  life  insurance  fund 

Government  life  insurance  fund 

Federal  employees'  retirement  funds  L.. 

Highway  trust  fund 

Other  trust  funds  and  accounts  « 

Deposit  fund  accounts  (net): 

Governiiiciil -sponsored  enterprises: 
Rfdcinptions,  or  sales   (— ),  of 
agency  obligations  in  the  mar- 
ket  

Investments  in  public  debt  se- 
curities  

Other 

Other  deposit  funds 


2,06- 


2,750 


3,405 


4,487 


5,  551 


391 

1,049 

996 

82 

300 


465 

1,010 

688 

82 

363 


502 
1,  745 
623 
147 
411 


413 


(') 

-395 
49 


441 


(■) 

(') 
-120 
-410 


495 


(') 

(') 
-437 
-121 


585 

1,965 

538 


430 
"399 


611 

1,393 

512 

87 
507 


-269 

170 
99 
56 


537 


-872 

548 
334 
229 


6,723 

1 

682 

1,644 

515 

86 

59! 

966 

1,530 


-86 

39 
39 
224 


8,116 
181 
730 

3,148 
544 
120 
699 

1,602 

1,020 


460 
-620 


9,454 
371 
778 

3,054 
562 
80 
792 

2,709 
806 


-1,222 

-70 
1,2 
6 


11,152 

571 

1,136 

2,736 

582 

83 

896 

2  3, 049 

1,699 


239 
479 
-97 


11,839 

756 

1,124 

4,  736 

707 

94 

955 

2,  745 

609 


-195 

434 

-224 

176 


Subtotal  expenditures 

Deduct:  Certain    trust    expendi- 
tures which  are  also  receipts  <... 

Net  expenditures 


4,952 
3 


5,169 

7 


6,769 
18 


8,545 
16 


9,43 
12 


12, 959 
10 


16, 068 
11 


18,  595 
135 


221,801 
908 


23. 757 
515 


12,950 


16,057 


18, 461 


20, 893 


23, 242 


Excess  of  receipts,  or  expendi- 
tures (— ) 


2,386 


991 


2,250 


1,409 


262 


-1,511 


-359 


INVESTMENTS  OF  GOVERN- 
MENT AGENCIES  IN  PUBLIC 
DEBT  SECURITIES  (NET)  » 


Employees'  life  insurance  fund 

Federal  old-age  and  survivors  insurance 
trust  fund 

Federal  disability  insurance  trust  fund. 

Railroad  retirement  account 

Uiieiiiploymcnt  trust  fund 

National  service  life  insurance  fund 

GovcniiiU'iit  life  insurance  fund 

Federal  ciiiployci's'  retirement  funds  '.. 

Hi'^liway  trust  fund 

Other  trust  fimils  and  accounts  '" 

Public  enterprise  funds 

Government-spon.sorcd  enterprises 


1,950 


1,545 


1,522 


n,241 


1 
1,463 


449 
583 
-245 


280 
590 
59 
-2 
588 


202 

-248 

23 

-65 

2.52 


141 

-545 

73 

-1 

314 


121 
258 
135 
-16 
548 


Net  investments,  or  sales  (-) 3,636  3,301  2,054  1,362   2,617   2,300 


14 
126 

(") 


101 

(") 


220 
325 

36 
274 

89 
-16 
803 
404 
122 

36 
(") 


36 

-499 
729 
-33 

-1,255 

95 

-56 

671 

418 
1 
91 
(") 


58 

-1,290 

552 

-35 

-1,011 

76 

-17 

958 

-393 

-112 

102 

(") 


48 

-726 

494 

264 

-41 

62 

-21 

871 

-428 

25 

166 

(") 


-225 

285 

-79 

-952 

-44 

-35 

1,063 

233 

-6 

149 

(") 


197  -1, 112 


Footnotes  at  end  of  table. 


TABLES 


483 


Table   13. — Trust  account  and  other  transactions  by  major  classifications,  fiscal 
years  1952-61 — Continued 

[In  millions  of  dollars] 


Classification 

1952 

1953 

1954 

1955 

1956 

1957 

1958 

1959 

1960 

1961 

SALES   AND   REDEMPTIONS  OF 
OBLIGATIONS      OF      GOVERN- 
MENT AGENCIES  IN  MARKET 

(NET)  12 

Guaranteed: 

Public  enterprise  funds 

Trust  enterprise  fimds 

-16 

-29 

37 

-30 

-33 

6 

-10 

-28 

(*) 

(*) 

-994 

(") 

-81 
—  19 

Not  guaranteed: 

Public  enterprise  funds   

-98 

65 

44 

-639 

-44 
-100 

136 
-1,  188 

-233 
-340 
(") 

6 
-67 
(") 

747 

86 

Government-sponsored  enterprises. . 

186 

-33 

-11 

(") 

(") 

Net  redemptions,  or  sales  (— ) 

72 

25 

4 

-602 

-173 

-1,085 

-567 

-71 

-1,023 

733 

1  Consists  of  civil  service  and  foreign  service  retirement  and  disability  funds. 

2  Adjusted  for  reclassification  of  certain  repayments  of  advances  from  the  general  fund. 

-  Includes  principally:  District  of  Columbia  revenues  from  taxes,  etc.,  and  Federal  contributions,  loans, 
and  grants  to  the  District  of  Columbia;  Indian  tribal  funds;  adjusted  certificate  fund;  increment  resulting 
from  weight  of  gold  dollar;  and  funds  appropriated  to  the  President.  The  railroad  imemployment  insurance 
administration  fund  is  included  for  1954  through  November  1958. 

^  Totals  shown  for  trust  receipts  and  trust  expenditures  exclude  certain  intertrust  fund  transactions  which 
are  included  in  the  detail  of  both  trust  receipts  and  trust  expenditures.  The  transactions  deducted  consist 
mainly  of  financial  interchanges  between  trust  funds  resulting  in  receipts  and  expenditui-es.  For  details 
of  these  transactions,  see  table  10. 

5  Includes  reimbursement  for  certain  administrative  expenses  met  out  of  general  fund  appropriations, 
and  beginning  Dec.  31,  1952,  for  employment  tax  refunds  as  provided  under  see.  109(a)(9)  of  the  Social 
Security  Act  Amendments  of  1950. 

6  Includes  principally;  Adjusted  certificate  fund;  District  of  Columbia  operating  expenses;  Indian  tribal 
funds;  funds  appropriated  to  the  President;  payment  of  melting  losses  on  gold;  railroad  unemployment 
insurance  administration  fund  from  November  1954  through  1958;  beginning  with  1955  Federal  National 
Mortgage  Association  secondary  market  operations  (net);  employees  health  benefits  and  life  insurance 
funds;  and  other  trust  enterprise  funds. 

'  Included  with  similar  security  transactions  of  other  agencies  shown  later  in  this  table. 
s  Includes  guaranteed  securities  beginning  in  fiscal  1955.    For  current  amoimts  see  table  8. 

9  Includes  $300  million  redemption  for  adjustment  of  excess  transfers. 

10  Includes  adjusted  service  certificate  fund  and  investments  of  other  accounts.  Beginning  with  fiscal 
year  1957  includes  Federal  National  Mortgage  Association  (secondary  market  operations)  and  judicial 
survivors  annuity  fund.  Federal  intermediate  credit  banks  are  included  from  January  1,  1957,  through 
December  31,  1958;  beginning  January  1,  1959,  they  are  classified  as  Government-sponsored  enterprises. 

11  Included  net  in  deposit  fund  expenditures. 

12  For  current  details  see  table  9. 


484   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  14. — Budget  receipts  and  expenditures,  'based  on  existing  and  proposed  leg- 
islation, actual  for  the  fiscal  year  1961  and  estimated  for  1962  and  1963 

[In  millions  of  dollars.    On  basis  of  1963  Budget  document] 


Source 

1961 
actual 

1962 
estimate 

1963 
estimate 

Budget  Receipts 
Internal  revenue: 

Individual  income  taxes: 

Withheld 

32,  978 
13, 175 

36, 325 
13, 645 

40, 225 
14, 245 

Other 

Total  individual  income  taxes -  .  .  .  . 

46, 153 

49,  970 

54  470 

Corporation  income  taxes.    .    ..      ..      .. 

21, 765 

22, 200 

27,  400 

Excise  taxes: 

Alcohol  taxes: 

Distilled  spirits  (domestic  and  imported) 

2,277 

795 

22 

96 

22 

2,360 

800 

23 

98 

22 

2,470 

Beer 

800 

Rectification  tax 

23 

Wines  (domestic  and  imported) 

100 

Special  taxes  in  connection  with  liquor  occupations 

22 

Total  alcohol  taxes 

3,213 

3,303 

3,415 

Tobacco  taxes: 

Cigarettes  (small) 

1,924 

17 

49 

1 

(*) 

1,980 

17 

52 

1 

(•) 

2,  050 

Manufactured  tobacco  (chewing,  smoking,  and  snuff)... 
Cigars  (large) 

17 
52 

Cigarette  papers  and  tubes 

1 

Another 

(*) 

Total  tobacco  taxes 

1,991 

2,050 

2,120 

Documents,  other  instruments,  and  playing  cards  taxes: 
Issues  of  securities,  stock  and  bond  transfers,  and  deeds 
of  conveyance 

141 

8 
(*) 

147 
8 
(♦) 

152 

Playing  cards 

8 

Silver  bullion  sales  or  transfers 

(*) 

Total  taxes  on  documents,  other  instruments,  and 
playing  cards ....           .    . 

149 

155 

160 

Manufacturers'  excise  taxes: 

Gasoline 

2, 370 

2  422 

2,485 

Jet  fuel.. 

13 

Lubricating  oils    .. 

74 

1,229 

237 

189 

280 

64 

33 

190 

56 

98 

25 

5 

21 

15 

2 

9 

76 

1,345 

260 

189 

368 

69 

37 

205 

60 
100 
28 

5 
23 
16 

2 
10 

80 

Passenger  automobiles 

1,  500 

Automobile  trucks,  buses,  and  trailers 

270 

Parts  and  accessories  for  automobiles 

200 

Tires,  inner  tubes,  and  tread  rubber 

391 

73 

Electric  light  bulbs 

40 

Radio  and  television  receiving  sets,  phonographs,  phono- 
graph records,  and  musical  instruments. 

225 

Mechanical  refrigerators,  quick-freeze  units,  and  self- 
contninp.d  ajr-r/inditiniiing  units.. 

65 

Business  and  store  machines 

Photographic  equipment. 

115 
30 

Matches 

5 

Sporting  goods,  including  fishing  rods,  creels,  etc... 

Firearms,  shells,  and  cartridges 

26 

18 

Pistols  and  revolvers    ... 

2 

Fountain  and  ball  point  pens;  mechanical  pencils 

U 

Total  manufacturers'  excise  taxes 

4,897 

5,215 

5,549 

Retailers'  excise  taxes: 

Jewelry ., 

168 
29 
132 

68 

173 
30 

144 
68 

179 

Furs 

30 

Toilet  preparations 

157 

Luggage,  handbags,  wallets,  etc. 

72 

Total  retailers'  excise  taxes 

398 

415 

438 

Footnotes  at  end  of  table. 


TABLES 


485 


Tabie  U— Budget  receipts  and  expenditures,  based  on  existing  and  proposed  leg- 
islation, actual  for  the  fiscal  year  1961  and  estimated  for  1962  and  1963— Con. 

[In  millions  of  dollars] 


Source 


Budget  Receipts— Continued 

Internal  revenue— Continued 
Excise  taxes— Continued 

Miscellaneous  excise  taxes:  ^  j.  ,  ^  ■t„. 

Toll  telephone  service,  telegraph  and  teletypewriter 

service,  wire  mileage  service,  etc 

General  telephone  service 

Transportation  of  persons 

Transportation  of  persons  by  air - 

Transportation  of  freight  by  air._. - 

Fuel  used  on  inland  waterways 

Diesel  fuel  used  on  highways --- 

Use  tax  on  certain  vehicles 

Admissions,  exclusive  of  cabarets,  roof  gardens,  etc 

Cabarets,  roof  gardens,  etc t——,\- 

Wagering  taxes,  including  occupational  taxes. --- 

Club  dues  and  initiation  fees 

Lease  of  safe  deposit  boxes 

Coconut  and  other  vegetable  oils,  processed - 

Sugar  tax --—-,-—. 

Coin-operated  amusement  and  gaming  devices 

Bowling  alleys  and  billiard  and  pool  tables - 

All  other  miscellaneous  excise  taxes 


1961 
actual 


1962 
estimate 


344 
483 
264 


Total  miscellaneous  excise  taxes 

Undistributed  depositary  receipts  and  unapplied  collections 


Total  excise  taxes- 


^"^SraTlnsSce  Contributions  Act  and  Self-Employment 


Contributions  Act. 

Railroad  Retirement  Tax  Act 

Federal  Unemployment  Tax  Act. 

Total  employment  taxes 


Estate  and  gift  taxes 

Total  internal  revenue. 


(*) 


Customs 

Miscellaneous  receipts: 

Miscellaneous  taxes 

Seigniorage 

Bullion  charges — 

Fees  for  permits  and  licenses 

Fines,  penalties,  and  forfeitures 

Gifts  and  contributions.. - 

jj-j  tcrGst      ____-- _____-—-—-—--—---------"- — ___-—-—- 

Dividends  and  other  earnings 

Rents.. 

Royalties 

Sale  of  products.. -:-;\:"''k\l' 

Fees  and  other  charges  for  services  and  special  benenrs. 

Sale  of  Government  property.. - 

Realization  upon  loans  and  investments... 

Recoveries  and  refunds - 


Total  miscellaneous  receipts. 


Gross  budget  receipts - — 

Transfer  to  Federal  old-age  and  survivors  insujance  trust  fund. 

Transfer  to  Federal  disability  insurance  trust  fund 

Transfer  to  railroad  retirement  account. 

Transfer  to  unemployment  trust  fund 

Transfer  to  highway  trust  fund 


-81 


12,  064 


11,  586 
571 
345 


12,  502 


1,916 


94, 401 


1,008 

5 
55 

6 
81 
14 

942 
805 
94 
114 
330 
100 
343 
1,012 
182 


4,082 


99, 491 

10, 623 

963 

571 

345 

2,923 


375 
495 

2S0 


1963 
estimate 


(*) 


107 
105 
40 
34 

7 
68 

7 

94 
24 

5 
2 


12,  842 


11,949 
597 
476 


13,  022 


2,110 


100, 144 


1,241 

5 
67 


(*) 


62 
13 

947 
751 
227 
120 
360 
104 
344 
407 
109 


3,526 


104, 910 

10,  972 

977 

597 

476 

3,132 


410 

525 

159 

34 

3 

3 

125 

120 

43 

35 

7 

71 

7 


1, 669 
67 


13,  418 


13,  809 
624 
976 


15, 409 


2,345 


113,  042 


1,346 

5 
40 

1 

255 

12 


(*) 


978 
804 
307 
124 
390 
107 
370 
668 
133 


4,194 


118, 581 

12, 780 

1,029 

624 

976 

3,379 


Footnotes  at  end  of  table. 


486 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Tahle  14. — Jiudf/ct  receipts  and  ejpenditiircs,  based  on  existiiif/  and  proposed  leg- 
islation, actual  for  the  fiscal  year  19(jl  and  estimated  for  19(12  and  1963 — Con. 

[In  millions  of  dollars] 


Source 


Budget  Receipts— Continued 


Dcdnct— Continued 
Kefunds  of  receipts: 
Internal  revenue: 

Individual  income  taxes.. 
Corporation  income  taxes. 

Excise  taxes 

Employment  taxes 

Estate  and  gift  taxes 


Total  internal  revenue. 
Customs 

Miscellaneous  receipts 


Total  refunds  of  receipts. 


Subtotal  receipts 

Deduct:  Interest  and  other  income  received   by  Treasury  from 

Government  agencies  included  above  and  also  included  in  budget 

expenditures 


Net  budget  receipts 

Net  BiTDGET  Expenditures 


Legislative  branch 

The  judiciary 

Executive  Office  of  the  President 

Funds  appropriated  to  the  President: 

Foreign  assistance — economic 

Other 

Department  of  Agriculture 

Department  of  Commerce 

Department  of  Defense: 

Military  functions 

Civil  functions 

Department  of  Health,  Education,  and  Welfare.-. 

Department  of  the  Interior.. 

Department  of  .Justice. 

Department  of  Labor 

Post  Office  Department 

Department  of  State 

Treasury  Department: 

Interest  on  the  public  debt 

Other 

Atomic  Energy  Commission 

Federal  Aviation  Agency 

General  Services  Administration 

Housing  and  Home  Finance  Agency 

National  Aeronautics  and  Space  Administration.  _ 

Veterans'  A  dm  in  istrat  ion  _. 

Other  independent  agencies: 

Civil  Aeronautics  Board 

Civil  Service  Commission 

Export-Import  Bank  of  Washington 

Federal  Home  Loan  Bank  Board 

National  Science  Foundation 

Small  Business  Administration 

Tennessee  Valley  Authority 

United  States  Information  Agency 

Other 

District  of  Columbia 

Allowance  for  pay  adjustments  and  contingencies. 


Subtotal  expenditures 

Deduct  interfund  transactions  (Included  in  both  receipts  and  ex- 
penditures)  


Total  budget  expenditures. 
Budget  surplus,  or  deficit  (— ) 


1961 
actual 


4,815 
810 


5,725 
25 
2 


5,762 


78,  31.3 


7,659 


133 
52 
69 

1,805 

77 

5,929 

498 

44, 676 
972 
3,685 
801 
284 
831 
914 
258 

8,957 
996 

2,713 
638 

387 

502 

744 

5,401 

86 
74 
37 
a  35 
143 
103 
39 
121 
227 
50 


82, 169 
654 


81,515 


-3, 856 


1962 
estimate 


4,  970 

900 

83 

(*) 

20 


5,973 

26 

2 


6,000 


82,  756 


656 


82, 100 


161 
59 
32 

1,935 
236 

7,177 
650 

48,250 
1,015 
4,469 
873 
298 
563 
853 
453 

8,900 

1,073 

2,830 

708 

501 

940 

1,300 

5,560 

92 

40 

a  101 

"239 

199 

250 

78 

147 

269 

90 

75 


89, 732 
656 


89, 075 


-6, 975 


1963 
estimate 


(*) 


5,170 

800 

83 


6,073 

26 

2 


6,100 


93, 693 


693 


93.  000 


148 
63 
22 

2,235 

186 

6,709 

815 

49,  700 

1,071 

5,183 

1,031 

304 

386 

261 

342 

9,300 
1,131 
2,880 
781 
578 
1,383 
2,400 
5,285 

94 

43 

»225 

«270 

257 

222 

63 

159 

259 

85 

350 


93, 230 
693 


92,  537 


463 


•Less  than  $500,000. 

»  Excess  of  credits  (deduct). 


TABLES 


487 


Table  15. — Trust  account  and  other  transactions,  actual  for  the  fiscal  year  1961  and 
estimated  for  1962  and  1963 

[In  millions  of  dollars.    On  basis  of  1963  Budget  document] 


1961 
actual 


1962 
estimate 


1963 
estimate 


Receipts 

Federal  old-age  and  survivors  insurance  trust  fund: 

Employment  taxes 

Deposits  by  States 

Interest  on  investments 

Payment  for  military  service  credits 

Other 

Federal  disability  insurance  trust  fund: 

Employment  taxes 

Deposits  by  States 

Interest  on  investments 

Payment  for  military  service  credits 

Health  insurance  for  the  aged  (proposed  legislation) 

Unemployment  trust  fund: 

Deposits  by  States 

Federal  miemployment  taxes 

Railioad  unemployment  insurance  account: 

Employment  taxes 

Other  receipts 

Advance  from  revolving  fund 

Interest  on  investments 

Proposed  legislation 

Advances  from   general  fmid  for  temporary  unemployment 
compensation 

Railroad  retirement  account: 

Employment  taxes 

Interest  and  profits  on  investments 

Repayment  of  advances  to  railroad  unemployment  insurance 

account 

Payment  from  O  A  SI  trust  fund 

Payment  from  Federal  disability  insurance  trust  fund 

Other 

Proposed  legislation — military  service  credits 

Federal  employees'  retirement  funds: 

Deductions  from  employees'  salaries 

Payments  from  other  funds: 

Employing  agency  contributions 

Federal  contributions 

Volmitary  contributions,  donations,  etc 

Interest  and  profits  on  investments 

Highway  trust  fmid: 

Excise  ta.xes 

Interest  on  investments 

Proposed  legislation 

Veterans'  life  insurance  funds: 

Premiums  and  other  receipts 

Payments  from  general  and  special  funds 

Diterest  on  investments 

Foreign  Assistance  Act,  advances 

Indian  tribal  funds 

District  of  Columbia 

Another  trust  funds 


Subtotal 

Deduct  interfund  transactions. 


Total  trust  fund  receipts 

EXPENDITUKE.S 

Federal  old-age  and  survivors  insurance  trust  fund: 

Benefit  payments 

Administrative  expenses  and  construction 

Refunds  of  tax  receipts 

Payment  to  Railroad  Retirement  Board 

Federal  disability  insurance  trust  fund: 

Benefit  payments 

Administrative  expenses— reimbursement   to   Federal   old- 

and  survivors  insurance  trust  fund 

Other 

Footnotes  at  end  of  table. 


10, 623 
755 
530 


1 

963 
69 
61 


153 

154 

52 

204 


571 
111 

31 

332 

5 

1 


846 
46 
12 

281 

,923 
2 


503 
9 
213 
228 
137 
281 
133 


24,  322 
515 


23, 807 


11, 185 

236 

86 

332 

704 

34 

18 


10, 972 
757 
521 


2,400 
476 

1.54 

92 

-52 

172 


597 
120 

40 

340 

10 

2 


14 
315 


3,132 

4 


.')20 
8 
216 
445 
79 
357 
132 


25,  018 
473 


24,  545 


12, 625 
254 
109 
340 

990 

62 
23 


12,  780 

837 

534 

79 

1 

1,029 

70 

75 

1 

42 

2,600 
976 

163 
64 


187 
155 


624 
120 

40 

375 

10 

4 

16 

866 

866 


14 
382 

3.391 

4 

-12 

518 
8 
217 
395 
54 
390 
121 


28, 005 


27,  506 


13,  538 
258 
111 
375 

1,073 

64 
24 


488   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  15. — Trust  account  and  other  transactions,  actual  for  the  fiscal  year  1961  and 

estimated  for  1962  and  ^565— Continued 

[In  millions  of  dollars] 


Source 


1961 
actual 


1962 
estimate 


1963 
estimate 


Expenditures— Continued 

Unemploj-ment  trust  fund: 

Withdrawals  by  States 

Railroad  unemployment  benefit  payments 

Admijiistrative  expenses 

Temporary  extended  unemployment  compensation; 

Benefits 

Reiiayment  of  general  fund  advances 

Repayment  of  advances  to  railroad  retirement  trust  fund. 

Proposed   legislation 

Other 

Railroad  retirement  accomit: 

Benefit  payments 

Administrative  expenses 

Advances  to  railroad  miemployment  insurance  account... 
Federal  employees'  funds; 

Retirement  funds 

Employees  health  benefits  fmid  (net) 

Employees'  life  insurance  fimd  (net) 

Retired  employees  health  benefits  fund  (net) 

Highway  trust  fimd: 

Federal-aid  highways 

Interest  on  advances  from  general  fund 

Refmids  of  taxes 

Improvement  of  the  Pentagon  road  network 

Veterans'  life  insurance  funds 

Federal  National  Mortgage  Association  trust  fund  (net) 

Foreign  Assistance  Act,  advances 

Indian  tribal  funds 

District  of  Columbia  funds 

Deposit  funds  and  all  other  trust  funds 

Subtotal 

Deduct  interfmid  transactions 


Total  trust  fimd  expenditures- 


Investments  in  public  debt  securities: 

Federal  disability  insurance  trust  fund 

Federal  old-age  and  survivors  insurance  trust  fund 

Federal  employees'  funds 

Railroad  retirement  account 

Unemployment  trust  fund 

\'eterans'  life  insurance  funds 

lligliway  trust  fund 

Federal  National  Mortgage  Association  trust  fund 

District  of  Columbia  municipal  government  funds 

Other  trust  accounts 

Wholly  owned  Government  corporations  and  agencies. 

Total 


Issuance  (— )  and  redemptions  of  obligations  of  Government  agen- 
cies to  the  public  (net): 
Federal   Nptional   Mortgage  Association:   Secondary  market 

operations 

District  of  Columbia:  Stadium  fund 

Housing  and  Home  Finance  Agency: 

Federal  Housing  Administration 

Management  and  liquidation  functions  fund 

Tennessee  Valley  Authority 

Other 


Total 

Total  expenditures 

Net  receipts,  or  expenditures  (— ). 


3,558 
252 


491 
'li' 


982 
10 
132 

955 
»23 
"51 

»2 

2,619 

1 

126 


801 
0  89 
191 
137 
303 
331 


23, 754 
515 


23, 239 


285 
»225 
1,122 

"78 
"952 

«79 

233 
(*) 

a4 
»11 

149 


438 


(*) 


"81 
797 

'50 


733 


2,840 
190 
425 

337 

2 

40 


1,050 
10 
66 

1,063 
"lO 
"31 


3,026 
""135" 


749 
856 
329 
62 
360 
136 


26, 047 
473 


25,  574 


39 

"895 

1,041 

"22 

"  250 

7 

»  10 

5 

"5 

»  31 

289 


169 


'856 


"225 
(*) 

"  150 
(•) 


1,231 


24,410 


24,  512 


-602 


33 


2,600 
165 
437 


495 
40 

150 
10 

1,080 
10 
55 

1,172 
"12 
"50 


3,250 


133 
2 

674 
470 
335 
70 
379 
244 


27, 148 
498 


26, 650 


38 

68 
1,015 

19 
251 

70 

"2 

5 

10 
"5 
343 


1,813 


'475 

■184 


(*) 


709 


27,  754 


-247 


Less  than  $500,000. 
'  Excess  of  sales  or  credits  (deduct). 


I 


TABLES 


489 


Table  16. — Effect  of  financial  operations  on  the  public  debt,  actual  for  the  fiscal 
year  1961  and  estimated  for  1962  and  1963 

[In  millions  of  dollars.     On  basis  of  1963  Budget  document] 


Source 

1961 
actual 

1962 
estimate 

1963 

estimate 

Budget  surplus,  or  deficit  (—)-.- .-  _-    

-3, 856 

-602 

285 

222 

1,311 

-6,975 

33 

-113 
-38 
694 

463 

Net  receipts,  or  expenditures  (— ),  including  investments,  of  trust 
accounts  and  other  transactions 

—247 

Increase,  or  decrease  (— )  in  outstanding  checks,  deposits  in  transit, 
etc'  . 

234 

Decrease,  or  increase  (— )  in  cash  held  outside  the  Treasurv 

Decrease,  or  increase  (— )  in  balance  in  Treasurer's  account 

Decrease,  or  increase  (— )  in  public  debt 

-2, 640 

-6, 399 

450 

Balance  in  Treasurer's  account: 

Beginning  of  year. _- - 

8,005 
-1,311 

6,694 
-694 

6,000 

Change  during  the  year 

End  of  year . 

6,694 

6,000 

6,000 

Public  debt  outstanding: 

Beginning  of  vear. 

286, 331 
2,640 

288, 971 
6,399 

295,370 
—450 

Change  during  year--- 

Endofvear,-.  -_  _-     _-.  __        _____      .  __.  

288,971 

2  295, 370 

2  294, 920 

'  Gives  effect  to  changes  in  amounts  of  outstanding  checks,  deposits  in  transit,  public  debt  interest  checks, 
coupons,  accruals  outstanding,  and  telegraphic  reports  from  the  Federal  Reserve  Banks. 

3  Because  of  wide  swings  in  receipts  and  expenditures  and  the  heavy  concentration  of  ta.xes  in  the  latter 
half  of  the  fiscal  year,  there  will  be  periods  during  the  year  when  the  public  debt  will  be  greater  than  this 
amount. 


490 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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Oi'oJt^'cc  cs  ro --r  ro  C4  <-rcc  c^'i>^'-h  uo  •r^'od'-r-^'io  cc  fo  c^'o --h  o  o  ogo  QO*t-^t--r'w 


C^P0C0Tt<05CDt^i-<C^NCCi0Tt*C^(N0i00'^'^(NOOiOOC00i<DO00r-<-Ht-.^ 
r-"rHa5COt>-OfOCDasOOi— "Oil— iC0t^»Ot--»O»OiO01t--t^'-HC^01'^"^»OTfOi— lO 
OOTt<CSTj<TfOOOOCOCCGOOSai»C'^i-*C^CC>"^fOt--iCr-iCSoOCCOOC^IOaOC^--Hi— ICD 


C^li-HGO'^f^'-Hrt^C^ICOC^CSCNCC'^rOOO'-HGOcOUOC^^-^CDiCOiO'^t^r-^Oai 


H^rtrt^rt^^i-H^^(NCClCOTt<-<}*'^Tt<T}H^TflTt^ 


Tt<  Tfl   lO  UO  Tt* 


^,_(,_(i0O0it~-"0':0'»*<CD0sh-0iOi; 


CO  GO  CD  •>£:>  -n* 


;  lO  to  -^  CD  "^  > 


^OOrfid-HCOC^CS»Or-iOCOQOOC<IO 
.,. -,    _-.      ^-     --      -      -     ...    _,       .l-CDOCOiOr— h-GC-^OiT^OOiOCO-^ 

OGOOiiO'^c<»-^»oo'^oot^aic^or--oic^»c^r--ooo50i^!^'-too5C^o^»o 

Ci  OT  CO  W  00  O"  to  to"  CD*"  CO -i:!*' CO  CC  ' 

-titotO'— iC^tooO<Nt^O:OCO'— ic . , __         _     ,  ______ 

C0C0C*DC0C0C000-^'<4^-*»O"^Ot^0001G0O'-HC<IC^C>IOlTt^tOtOto»OC0CDr^C00S 


t-tOC^rJ<-^--HC^"^tOOSOCOcOI--CDtocDtoC^r>-t^C^GOOtOXO"^tOi— iCD'^i— t 

t--oicooi^'— 'cso-^r-ototoi— (Tt^r^cDcococ^oooc^cQ-— '-t*r-'05CD0i'-HO 

I-,CDrft^i-H01O-^C^0iG0C^OtOc0l>-00i— it^COCDC^IGO'-tOlI^OOto-— iT}<OI--00 


I-'HOOOCCOO^iC'rt^t^l^rtOOOCOCOOlcD'^tOOOlcOOiOI-^'MOCOCDC^COC^I 

H^^        -^t^iOr-iOOlCDOOiM'M'rfiM^OCSt^to^^'rTrGOOin^Mt-'^OOl^ 

C^Tj-u5tOtOtOcDGOO'^cDCOtOrJ<C^C^(NiOtot^t--t^OlC5aiO'— 'C^ 

1-H  i-T  .-H  C<f  (N  C^'  C*^  c4  C^  W  (N  CM'c^'csI  (M'c^(>f  CC'  CO'co' 


5-5.2 


■^GOtOOOC^ICO-^OCOCDC^OfMCD' 


OCO<N-HiOOOSOO»OI 


jr^t^aiGO^r^cooos' 


•  OitO'^pr-i^c^^oscoaicot'-t-'Oi-^ 


;CSt^'<*<CCOi--'tM^CO'^C 


OOt^CDCOOt^CO'^l^cD^COC^I^'erO'^Olt^O'- 

CO  CO  r-^  oT  CD  c^  00  CO  CO  CO  c^  tD'oi  r^  o --H  o  t-T  t-^  oT  o 

NC^C^COCOCOCOCDOOtOCSCOCDr-CDCDuOcDtOOicDtO'^'^Tt^'^'^'^ 


COOSOOt^O'— tOGOr-((NtOOCOCDCOtOi-H-rJ4CDC^(M'— i^-^iOOO-^OOOCOGOOCO 
C5COC^GOOi^OOcDOias03CD(NOOcDOiOi'*01CDGOOtOt^COr"-<NOO(NO^tOI-- 
C^C^C^r-iC^'^t^CSOlOOCOO'^OiCDOCOOO'-HOir'CDCMCOtOCDOOtOTfCOOiGOO 

Co'cDodtc'tOCD'od>--*"co"cOTt^t^O^^OlOC^I^MOodr-^CDt•^OOQ^ 

I— tC^COCO"^CDtOcDcCr*CDI>-C0t--GCGCG0i^0ii:^O: 


iO»-H»0r-it0G0'^01'— t.-H'^^C^CS-^OOt^GO'-^OlTfCO-^CO'-HOt^WOCOt 
'05t--i— iGOtO'^Ot^-^CDCOtOGC'CS.-HOSCD'— "OOOOt^CO-^fNOlOCOC^ 


'OCS(NiO':fCOr^tOt--i— iOt-iCD00-*OC 


OCDOlt^<N'^tOiOC^CS-<*< 


'COCO'-H-^I^OiOi'^CDCOtoOiOOO'-Ht^cOh-tOr^lMOit— toot~-t---oic 

iCOCD<— t-^h-CDtOcO'— tcDiOiOCOtOcDOiOOCDcDCMcDcDCOcDCDtOCOOiOl 

.— (C^iM(N(N(N(MCOCO-^iOCDCDcDcDcOCOCDt^b-r^l-^r-t>-t^r^r^t-^ 


oooosr-toooTfi-'Oicotocsc^oocor-cDoasco-^O'^or^cDoi'^'^'^cD'— ICO 

05'— 'r-0"^CDCOCOTpcDr--CO-^Oit^COOOCCDCOtOOCOCO(NC005COOCOa:cD'^ 

iot^»ccir-'«t'cD*^octor--cD'OoOTj"cotccoc^c:!jiOOi-^r^co'OcOi-^'— '■^i~--to 

i-T  C?  oT  I--'  CD  OO'  to  C^'  rjJ  O  CO  t^  or  TjT  .-H  oi"  ■^'  O  to  cd'  t^  --H  cd"  OT cd'  go'  O  CO  O  ■**  oo  lO'  CD' 

1-H.— I  cDcDC^r-CDCO'— 'C^|-^GOO:00'*«OOCOOiC^'^GO'9"OOr-'MOOtOaitOt^ 

.-tCS(M(N(NCO-'J'tOt-^00'^l--CDTfCO'*t^tOOOCOOOOOOOC^C^ 

T-^  i-T  t-4   .-H  ^'  r-T  ^*"  r-T  rH   ,-H   ^'  C^"  c4"  CS*  W  C<f  C^*" 


a)0^c^co'«**»ocDr^ooo>Oi-icsco-*»ccDt-ooosO'-HWco'<J*iocot^cjoq;o^ 


(NCOCCe0COCOC0C0COCOfO"*-<»*TP'*J<Tj*Tj*Tt< 


tOiOtO>0»OiOiOiOtO»OCDCD 


0>OiOiOiOiOiOiOiO>OiOiOiOiO^OiOiOiOiOiOiOiOiOiO>OiOiO>OiO>OiOiO>Oi 


614359 — 62- 


-32 


492   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


O         Ch 


at: 

-  3'; 


b  3 


^■s. 


ois^j'S 


•—  o   '  c  fl  2  " 


(^  ^  •;:;  •;r'  "  x;  "*  S 


5f  >-  o  c  I 
2  o  V  .2  ^ 


3  ^  C3 


bSs? 


J2  o  a>  t;-5 


<    -    ■^ 


"°   C   i  M 

C  £  C3  o^ 


dlOGOt-O-HlCCDr-t 


^«gCOG0005'^.-(QO»0 


^     --.     -  I>  'O  t—  05  "'T  O  rH  t^  Ci  CO  C*  -^  •-    -^  "*  —       ■      -  -' — 


t--CTi"»*'Or-Hr;-aicooo»ot^T^Xfo>— <.— nMfOooc^o 


O"OClt-»r-HOO0S'-Ht--.-HCJ0 


C2iO(MCSOr^  'Ct^IN..— ."rt.f.5(>jC^iO01  --rofOoocMoi^tooT 


■^00  '^  GO 


^OiTT.— it^OOOOCS 


cccooo»ox>r-io:co5 


cc?ocC'^rrrO'^oi>-totor-os"*:oi^ooforooo^GO^r>.Oia>t^oo 

1-h" --H  1-H  f-i  C^' C^f  W  C^' M  CO  CO  CO  CO '^*' Tp 


T^iOOOt-^i-HCOC^iO  ■«*'O0C 


t-*05:D0i'TfO»CC^00OCDOaiC0Q0C0i-H 
iCOO^OOOOiOTfCC'CDO'O.-HOOOCt— 


"^  -^  oc  ic  -^ 


j-H^^cocC"0'*<5tC'5rcx)C^*'^oo"^coooiOTrcC':DO'0^c»oct--t^ocicc(>i 


CO-^C^t^Tt^OiO'-HC^t 


oascooO'*(MOC^Tj"(Mcoocor-iccJO 


COtTCOCO^COi— ii-Hi— (i0»OC0iOO^-C^C**r-<-^C^C0C^01'— <C^CJCO*iOiO 


CO'^t--iOiOiOOlOST-HOO»OOiTj*C^Tt<»-^l--rt»'^Tj< 

':ccor>-r^i^ioiccocMr^Otrooi^^O'^oooa> 
iO.-4»oiooi'VQOcooosi^c^o>-Hor-cor-i-<o  ^,-^,.^^_^,-^„-^,,_^„,^^ 

?fO  r?  ^J  ^  *^  oo  oT  c<r  t^  oT  oo  ^4"  r^  cT  ro  Oi  ci  ic  CO  ro  rv  rL^ 


iCOCOCOCOCOCOTp'^-^TjHiOiOiOOcCt^GOOliO"' 


SSCOI~-OC^GOOCiC^CO--sJ^OtOOi'^OOCOCDCO 

O'-'C'icooiO'OcoooiTfo:.— ■»ooaior-i^oo 
I>-0500'^COCOiTriOiOCO'^000'-«'<3'COiM-^ 

w  <D  io  c^*  «o  uo  ^-^  o  o  "-H  oT  CO  1--^  o  ^  lo  »-^  (n' oT -^ 


OlOC•^l-^>o-*•cocccOTfOO»ooOlOO:cooooT^•ooco■^OiOi<NO*OQO 
c^.— (CDoi^QOooooi'-HiO'<j'r-ooGOcst-iO'— ICSC010CX30'— i-^u:)Tr^05 

tH  i-h  C£;  O -^ -^  <N  .-<  lO  CO  CO  O -^  tP  lO  O  tH 


C^X'Tt<CiC0aiC0Tt*0ic0cDOh-0iC^C0C0O0iOTr0i-<:t<G0TrCiC0'^O 
.— iCMCDco-— (ri»o«oi-"^':oococM»or-.cO'-H'--t-.(Micor--OJ!--oirO(N 
•-HiocDOsdooooiC^r^05Tr'Oc^cort"oococoosTroooQOCo^oa5 

c<r  »o  o  i^  oT  GO  CO  oi' CO -o  lo"  ci"  i-T  as  ^^  00 1--^  ■'i^  ^  i-^  w  lo 

i-Hi-H  C0»Ot^CC'0iOQ0t^C0'^'^C0'^»O»O 


C^^OOC^COt^'<*<C^r-<»OOiCSi-<CD»ftOO'^OiO 

r-OcQCSOSOOO'^'— '05.— ii/tOicO-^t-^'OCit^O 
05Tj't^,--r--.— it^COOTt"iCC^OiCSi-.^COQOCOCO 

CO  O"  ^f  O  »^  »c"  C^  CO  O -^  CC  O  CO  t-T  o  CO  O  CO  Oi"  30 

I— if-iMcococo'^'^iOTroi—  ooosciOiCJ 


OOGCOOOSt^OSiOTt^.-HiO'^t^C^t— "^CiOCOQOb-t>-'OC^TfO»-t*-OC^ 
CCCOCOO^-iOr-HiOiO.— <-^C0iOO5(M00O:O500CSTj*cDi-tI^«O(N'— icot-* 
OiCOcOC^OOiOGO^OOCCOCOC^OOiC^COt-COCOOOCOCO'^OOOl-^'O 

■Tt^  tC CD' CS  O  •-^" -^ --^ '-<" -^ CO' O  O  CO  ■^ oT O  rH  GO --H 


^C-JC^lCO-^COCOTfiOcDr 


.ioiotcojooo»ocor^»ciicr^Oi'» 


*  CM  (M  (M  COO* 


0s01»0i— lOOOOCOCOOO --.-      -.      - 


-       _     _    _    _    _         -    _      .    _,  OO'-HOf-HC^r-lOGCOiOiOTj'OSOit^i-HO'^'^OS 

osoi»Oi— loooococooooor-io-^r-co'Ofocot^coc^^oOiascscor-.— < 

~  ""     '■ I-  Tj^  .-.  Ci  t^  t^  l^CS  t-*  C^^  -^  00 


coiocDi-^ot^^-ococoo-— tOiooaic^^oooos-^t-Trccioi—ocooiao 

1-1  i-'i-tMC^^5'*CDaJMCMOO'-'CDt-^COCOTf»0(£)CO'X30 


'*ooooo^r^co--Ot^^Ot^t^Tt-Oicor^O":i»oojTf*iO'rt<cO"<ro5ao05 


'lOOCOOiOCO-^COC 


-  C»  O  Oi  CO  c 


<I3O--HOOOOC0t^C0C^(MC0r-(OCT)r^<; 


)-^co  — ococn  o-    .-    - 


^lOcor^oso-or-ooo-^coot^cMi— tcocor-H^-oci-^oioioio— «o 

1— 1»-<  CSCOCDOiCOiMiMTr^-^COXClO^r^CO 


rj<t— CO.-'OiOCO^CO(N'ft<(MDOCOOCOC^OCOOiCOCMCO<NCOCOCM<NC 
I^C^OOOOCMiOOI--MC^"^d30»Oi— iCCCOTj*f-HOO'~Hr-COOi"--dC 
lOiCOCMCMCOr— CO«^.-i'^(N»CQOCOOiOOOCO'— 'r-"*'OOCONON!MC 


C^MC000>OC0(N0i^r^.-<f-'(MiC-fOCM(NC0Q0iOr-t^-£TrO05^C0 


.-Hcoco-^OTp'^ioocr^ 


CMOi^cO'omr^accC't't^Trt^ccco?^ 

")  O  CO  T-H  1-H  O  CO  CM 


CO»OOCOCOOt-*COr-iCMOOCO'OCMiOI>-OC^OiO'— 'OlOO'^'— iCDiOOiO 
COOOOCCCDOiCOC'l?O^Ht--CDO'-<OCcOt-CO'^CSC^'— 'coooioor-os 
CM  C^JOO>—Tt"iO"^C^C^TfCOrroOCCOQOt^OcOt--COCOO^'^  CO' OiCOOC^ 

CO  to  r-^  t  -  ^  .-H  o -"J"  GO  CO  CO  c^""  CM '^  <^f  o  t-T  o  ^>^  CO  CO  0^ 

1— ic^ic^iCMcoco:ococO'*'<j<iooir^cooCGOt^i>-t>'t-^cccoi^t^coi^Grt^ 


OltOCMOCOXOit  - -. 

CMt^co-*rco^-^ooc^»oooo— icOOlt- 

OiiOiOCO>CCOO'-HO^t-     ~^     " 


i-«t-^C0r-C0"0c0C0t^OI>-'O0iC0Q0t-t^O3C0C0C0 
*" -  -  Ol  t-  CO  -^  t-  ■*  >—<  !>.  Oi  I--  Ol  >— <  CM  lO  -^  O 

co-dcocc>cmco^-cogoococmcoc<i:<jco 


-rrM^I^C0C0r--C0C0a)G0^iCi0C000C0-*00'^Oy3"*OG0C0O'0O 

c^iocor^OiOOCM-^cooor-oocor-ocooocooicoiccoocoO'-'i' 

■"-  -■ O  iC  iO  r- 00  GO  OS  O '^  X?  I~  O  CO 

^^-^•',_rCM'"CM" 


.-H  CM  ■-»  ^  T-H  : 


IC^fCMCOCOCMCM'^" 


OsOi-<CMCOTt«»OCOt^OOOiO'-"CMCO'«^'OcDr~-OOClO'-«CMCO"^":iCOt^OCOiO'— ' 
C^C0C0C0C0C0C0COC0C0C0'n"<5''^'^-^'^'^"^-^"^»OiO»O>O»C»OiOiO»C»Oc0'O 


TABLES 


493 


'"OJQ0010iOTfC5iOt^(NPOCOOr^«OI--.t^OI^t-COCD05»-lC^» 


CC  ^  005  I 


it^tocoi-'OOacc":'!. 


1  ic  1-1  Oi  r--  lo  CO 

■'GOO'— It^lOTfr^rHOO 


■iiMt^cocoxir^cccocoi-Hr^io^DocoitMeoc'iiooiJO 


C3  -*-i  O 


oci'-'Oi-'Oi'^fOio-^OiicorcTj'coair-HCQ.— I  Tr^t'C^O'-HCNooot 


•  -—••Nr^ooaooio 


;ciooit--OTf'*'05»-<roiooO'-<-roGr-Oit- 


Tf<»C(N'rj*t^O'^l>-^C^OCNCD^O^^r-.00'-.00(N'^OOQOaiOOGOcCOi-*CD 

»ocv3csi-H-^r]'rj<"io'Goarodooor^c»odorcc-r^io.-H'^ 

i-i.-H.-H(roirocQcocococorocciMi-i^ 


JGOoo-— I-— ifooroc^oi'^'^ososooaioo'i 


3  C-  Oi  C^  .-«  CO 

I  (N  lOj-i  c>  lo  !>■  t^  T-i  ^  ooaTioQoor-^crco  co^rH 


iGO»-H(NCNt-.-'CO(MD0; 


Oi  Ci  ic  :o  '£>  TfH  ^ 


T^C^IC^T^COCOCOCCCOTfCOCO-^-*-^'— Ir-* 


lajcicoc^ocofooiGot^Tfcao'Oiocoooaj-rajiM 


I^  CO  00  00  L 


Qoeoi-nr^O'-H^o^oo'^ocD 


ifOT-»;D-— it-ococot^^'-H-^-^-^cni-iccO'^c^ 

-"  X)  >C'  CO  tr4  -^  'T'  to  Cl  CO  t--  00  ■^  O  — ■  O)  <^<  CM  »0  CO 


I.— •t-dOSOl'^'-Hi— (i— lOt-^COCOOOO'^  OC^CNQO 

.  ^  ,«  ^  --.  -,  ^  *. . —  "5  CO  1-^  o;  Ci  c^  w  c^  ■n'  o 

SOi'^'-tcDOOOOC^"^ 


iOi00Oi;CQ0"^C'1CO00C-iCOCOI--O;CiC^r-4C^' 
r  t^  Ci  .-H  lO  -;-  -^  ■ 


coco»CTj-coTi<t^oor--ai0^i>.ocooco 

lOJOOiCO'^CDOSC^-^Oli— "lOiCOir-tTfit-^OlC^OO 
»-ii-(i-H.-i(N<N<MCCCCCOCMCOCOCOC0'^Tj« 


lO.-^.-^OOOr-'+'GOT-l1— (Tt'iOoOCOOOOOsOTt^ooO'— 'COCOi- 


K  Oi  t-  t-  Oi  O  CO  CO  I--  t-  t— I  Oi 


DC^I>-O"00iOC0C0(N^CMOC0t^<NC0C0CCi' 


-COCJ^CC  ■^O^-^OOt--'— "I. 


I  iQ  .-I  CO  -^  O  00 


^  05  Oi  r-i 'st^  CO '^  CC  b- 00 -■  --     .    . 

^^.-HCSCsKMfMCSC^-^Oi'^OCOi 


-C^iCw(N'^tr:il:--(MOi-'!:COi<M(NCO 
'  —  '-T-H.— liOOS-—  i-HC0"rt<CDt--.Ol'— t-^ 


i-HC^)<N(N!NCOCOCOCO-V'*CM(M<NC*CNCOCO 


^  S  is 


O'xrjCNiio^^r^cOi-HQOco  oo5!Mioco.-ii-ioooci 

t--CDfOO'^C^(M.-MCM— «CDOC0-^0100iMCMOiTt< 
rtiMiMi-iO(NOl(Ni-tO'T'OCOT-(.X)OCOt^cO;D 

o  lo  to --^r  cf  •-^rcrorcTr-T'C  o  00  c^r.-<  CD  ,-H  ^^     r--^ 
oocotNC^03i-HO-*otot--.airo05c^co-^toi--.05 

i-iC^I-^'^tQ-^Tj^'-fi'^jH'^-^-pT^CiOCQCOCOCOCO 


CO  .-H  CO  00  C^  I 


■lOSO'-iOOiCDtOOOCOC^ 


TtHiOCJOOCOOCOCOOliOOSCD^.— icocct-c, 
C000'^tOOCOtO00l>-I^00X»O.— il-^TjiiOi-H 

00  00  i-T -«j^  o  (^f  iC  >f "  o  "O  oT  o  r^  t^  oc  r4  c^"  00 

t-^00000000I^00Oi05t--tOiO»OiOOcCi<:0 


OiCsOCOOOOO'-iCO 

CilDi^toioioooaiOscoooo-— 'oor-oO'-Hoic^r- 
od  c^f -^  ccT  ij^  to"  <--^  CO -^  cd"  c^  »c  o --H  CO  ci"  00  t^  o --r 

'-HCO-^OOOSCnOSOiOiO'-H.-'.-Ht^OOOrOiOC^CO 


^CO<DOOcD.-HCT>:Ct'— (■^^POOco.— i-^-^OSr^X" 
"^C^C^.— lOoOCO'^OOOCOCJCOtOOOi'^OOC^l 

r^c^t^"^t^"^tcair-^C"^OiOoc"i"«T'tooicsCM 

cT -^  ocT  oT  .-H  ^C  oT  i-T  to  r-T  ^  oT  cT  t^' 00  oT  00*"  oT  c5"  o 

■— l-«ftOt-aJ05t^-0-^iOtO"rtHfO<MC^C^C^7^CO(M 


1— 'COCOOC^toOiOOOOiOi.OitOcDO'^-^OJCaoO 


O  '^  t-  04  Tt^  ■— I  O  00  CM  CO  CO  "1 


lO  CD  -rr  O  CO  «}  Cr-  Ol 


;cococ^co*Doocc;Qocicoocsccco-4::--«coOrr< 
•-T  00  CO  ■^  co""  CD  r-T  o  o  o  o  ■'i^  o  (^f  c^f  CD  o  o  »o  00 

TfGC'-HQ01MfO»-M.-«01.— .(MCOO-^^tOtOtOtOCOO 


OiOi-'C<ICO'»*<iOCDt^00050'-H(NCO"^»OCOt^OOOiO'-HC»lCO'^iOCDt^OOOSOi-< 
C<)COCOCOCOCOCOCOCOCOCOTt*Tt^'rt<'»*<'^Tj^'^rj<rrTt<toiOtOtOtOtOiOiO«OiOCDO 


494 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  17. — Internal  revenue  collections  hy  tax  sources,  fiscal  years  1929-61 ' — Con. 

[In  thousands  of  dollars] 


Excise  taxes— Continued 

Taxes 
not 

other- 
wise 

classi- 
fied 

Fiscal  year 

Miscellaneous  excise  taxes— Continued 

Unclassi- 
fied excise 

taxes  13 

Total 
excise 

taxes 

Grand 

Club  dues 
and  initia- 
tion fees 

Sugar 

All 
other  12 

Total  mis- 
cellaneous 

excise 

taxes 

total 

1929      

11,245 
12,  521 
11,478 
9,205 
6,679 
5,986 
5,784 
6,  091 
6,288 
6,551 
6, 217 
6,335 
6,583 
6,792 
6,  520 
9,182 
14, 160 
18, 899 
23, 299 
25,499 

27,  790 

28,  740 
30,120 
33,  592 
36, 829 
31,978 
41,963 
47, 171 
54. 236 
60, 338 
64,813 
67, 187 
64,  357 

5,492 

5,891 

4,053 

2,876 

55, 122 

112, 052 

67, 418 

44,  656 

46, 964 

49,410 

46,900 

43, 171 

45, 143 

131,461 

192, 460 

193. 017 

188, 700 

172,  249 

75. 176 

88,  035 

89,  799 
98,  732 
79, 210 
89,  568 

103,  799 

104,  858 
107.  848 
109, 445 
155,  749 
158, 494 
128, 939 
148,  790 
178, 198 

22, 820 

22,642 

18,310 

13,939 

91,886 

151, 902 

108, 324 

88. 957 

97,  561 

131,307 

162, 096 

165,  907 

224, 855 

417,916 

734, 831 

1,076.921 

1,430,476 

1,490,101 

1,551,245 

1,655,711 

1.752.792 

1,720,908 

1,842,598 

1,947,472 

2,061,164 

1,936,527 

1,492,633 

1,608.497 

1,718,509 

1,741,327 

1,435,953 

1,  386,  829 

1, 497,  526 

539,927 

565,070 

520,110 

453,  550 

838,  738 

1, 287, 854 

1, 363, 802 

1,  547,  293 

1,  764,  561 

1,  730, 853 

1,  768, 113 

1,  884,  512 

2,  399, 417 
3, 141, 183 

3,  797,  503 
4, 463, 674 
5, 944, 630 

6,  684, 178 
7, 283, 376 
7,409,941 
7, 578, 846 

7,  598, 405 

8,  703,  599 
8,971,158 
9,946,116 

9,  532, 222 
9,  210,  582 

10, 004, 195 
10,  637,  544 
10, 814,  268 
10,  759,  549 
11,864,741 
12,  064, 302 

2,939,054 
3, 040, 146 

1930 

1931       

2  428  229 

1932       

1.557  729 

1933 

1.619,839 

2.  672,  239 

3,  299  436 

1934       

11371,423 
n  526, 222 
11  71, 637 

1935     

1936.   

3,  520,  208 
4  653  195 

1937 

1938 -- 

30,  569 
65, 414 
68, 145 
74,  835 
68,  230 
53,  552 
68, 789 
73, 294 
56,  732 
59, 152 
71,  247 
76,174 
71, 188 
80, 192 
78, 473 
78, 130 
74, 477 
78,  512 
82, 894 
86,  091 
85,911 
86,  378 
89, 856 
91, 818 

5,  658,  765 
5, 181  574 

1939 

1940 

5  340  452 

1941       

7, 370, 108 
13, 047, 869 
22,  371, 386 

1942 

1943 

1944       

40  121  760 

1945-     

43,800  388 

1946 

40, 672, 097 

1947       

39  108  386 

1948 

41  864  54'' 

1949 

40,463  125 

1950       

38, 957, 132 
50. 445, 680 
65,009  586 

1951 

1952 

1953 .-.- 

69,  686.  535 

1954 

69  934  980 

1955 

114,687 

-31,  209 

66, 237 

-32,  749 

66, 351 

99,644 

-80, 943 

15  7, 352 
15  5, 269 
15  15,  482 
15  7, 024 
15  5, 444 

66, 288, 692 
75  112  649 

1956       

1957       

80,171,971 
79  978  476 

1958          -  - 

1959       

79  797  973 

1960       

91  774  803 

1961 

94,401,086 

1  For  figures  for  1863-1915,  sec  1929  annual  report,  p.  419;  and  for  1916-1928,  see  1947  annual  report,  p.  310. 

2  Beginning  with  January  1951,  withheld  income  taxes  and  old-age  insurance  taxes  on  employees  and 
employers  and,  beginning  witli  January  1957,  disability  insurance  taxes  on  employees  and  employers  are 
paid  into  the  Treasury  in  combined  amounts  without  separation  as  to  type  of  tax.  Similarly,  for  the  same 
periods,  the  old-age  insurance  and  disability  insurance  taxes  on  self-employment  income  are  combined 
with  income  tax  other  than  withheld.    The  distril)Ution  of  amounts  of  these  taxes  liy  type  is  based  on 


TABLES  495 

estimates  made  in  accordauce  with  provisions  of  Section  201(a)  of  the  Social  Security  Act,  as  amended 
(42  U.S.C.  401(a)).  Individual  income  taxes  withheld  by  employers,  1951  through  1956,  include  amounts 
subsequently  transferred  to  the  Government  of  Guam,  under  the  provisions  of  the  act  approved  August  1 
1950  (48  U.S.C.  1421h).    Beginning  with  1957  these  amounts  are  excluded. 

3  Beginning  with  1952  includes  the  tax  on  business  income  of  exempt  organizations.  Includes  income  tax 
on  the  Alaska  Eailroad,  which  was  repealed  effective  for  taxable  years  ending  after  June  30, 1952. 

<  Repealed  for  years  ending  in  period  July  1, 1926,  through  June  30,  1932,  and  for  years  ending  after  June 
30,  1945.    Beginning  with  1951  included  under  "Miscellaneous  excise  taxes.  All  other." 

5  Beginning  with  1954  includes  amounts  of  tax  collected  in  Puerto  Rico  upon  products  of  Puerto  Rican 
manufacture  coming  into  the  United  States;  data  for  earlier  years  are  exclusive  of  such  amounts. 

8  For  1956  and  earlier  years  amounts  shovra  for  "Distilled  spirits"  include  amounts  collected  by  Customs 
on  imports  of  both  distilled  spirits  and  beer.  Beginning  with  1957  the  method  of  reporting  has  been  revised 
to  include  imported  beer  under  "Beer"  instead  of  "Distilled  spirits." 

'  Includes  stamp  taxes  on  bonds,  issues  of  capital  stock,  deeds  of  conveyance,  transfers  of  capital  stock 
and  similar  interest  sales,  plajing  cards,  and  silver  bullion  sales  or  transfers. 

8  Includes  taxes  on  sales  under  the  act  of  October  22, 1914;  manufacturers',  consumers',  and  dealers'  excise 
taxes  under  war  revenue  and  subsequent  acts;  and  for  1932  and  subsequent  years,  manufacturers'  excise 
taxes  under  the  act  of  1932,  as  amended.  Soft  drink  ta.xes  are  included  under  "Miscellaneous  excise  taxes, 
All  other." 

9  Begimiing  with  1933  includes  manufacturers'  excise  taxes  on  jewelry,  furs,  and  toilet  preparations; 
beginning  1942  includes  manufacturers'  excise  taxes  on  phonograph  records,  musical  instruments,  and 
luggage.  The  tax  on  phonograph  records  for  1933  through  1941  was  not  reported  separately  and  is  included 
in  "Radio  and  television  receiving  sets  and  phonographs,  parts." 

10  Repealed  by  Revenue  Act  of  1951.  Collections  for  the  years  subsequent  to  1952  are  included  under 
"Miscellaneous  excise  taxes.  All  other." 

"  Repealed  effective  August  1,  1958. 

12  Includes  collections  from  sources  other  than  the  miscellaneous  excise  taxes  shown,  and  also  (a)  certain 
delinquent  taxes  collected  under  repealed  laws,  except  automobile  taxes  for  1929  and  1930  which  are  included 
under  "Manufacturers'  excise  taxes.  All  other,"  and  capital  stock  taxes  prior  to  1951  which  are  shown  under 
"Capital  stock";  (b)  internal  revenue  collected  through  customs  offices  for  1929-33;  subsequently  such 
collections  are  included  under  "Alcohol  taxes",  and  (c)  various  other  taxes  not  shown  separately. 

'3  Includes  undistributed  depositary  receipts  and  unapplied  collections  of  excise  taxes. 

'1  Consists  of  agricultural  adjustment  taxes. 

15  Beginning  with  1955,  includes  unidentified  and  excess  collections,  and  profit  from  sale  of  acquired  prop- 
erty. For  1954  and  earlier  years  such  amounts  are  included  in  "Miscellaneous  excise  taxes,  All  other." 
For  1955  through  1957  also  includes  depositary  receipts  outstanding  six  months  or  more  for  which  no  tax 
accounts  were  identified. 

Note. — These  figures  are  from  Internal  Revenue  Service  reports  of  collections  and  for  years  prior  to  1955 
are  not  directly  comparable  to  gross  budget  receipts  from  internal  revenue.  The  differences  in  amounts 
occur  because  of  differences  in  the  time  when  payments  are  included  in  the  respective  reports.  Tax  pay- 
ments are  included  in  budget  receipts  when  reported  in  the  account  of  the  Treasurer  of  the  United  States. 
Through  1954,  the  payments  were  included  in  Internal  Revenue  Service  collection  reports  after  the  returns 
to  which  they  applied  had  been  received  in  internal  revenue  offices. 

Under  arrangements  begun  in  1950,  for  withheld  income  tax  and  old-age  insurance  taxes  and  later  ex- 
tended to  railroad  retirement  taxes  and  many  excises,  these  taxes  are  paid  cuirently  into  Treasury  deposi- 
taries and  the  depositary  receipts,  as  evidence  of  such  payment,  are  attached  to  quarterly  returns  to  the  In- 
ternal Revenue  Service.  Under  this  procedure,  the  payments  are  included  in  Ijudget  receipts  in  the  month 
in  which  the  depositary  receipts  are  issued  to  taxpayers. 

Revised  accounting  procedures  effective  July  1,  1954,  extended  this  practice  to  Internal  Revenue  Service 
collection  reports,  so  that  these  reports  likewise  include  depositary  receipts  in  the  month  in  which  they  are 
issued  instead  of  the  month  in  which  tax  returns  supported  by  the  receipts  were  received  in  directors'  offices. 
It  is  not  possible  to  make  a  complete  classification  of  excise  taxes  paid  into  depositaries  until  the  returns  are 
received.  Accordingly,  the  item  "Unclassified  excise  taxes"  includes  the  amoiuit  of  "undistributed  deposi- 
tary receipts",  i.e.,  the  amount  of  depositary  receipts  issued,  less  the  amount  of  depositary  receipts  received 
with  returns  and  distributed  by  classes  of  tax. 


496   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  18. — Internal  revenue  collections  and  refunds  by  States,^  fiscal  year  1961 
[In  thousands  of  dollars.    On  basis  of  Internal  Revenue  Service  reports] 


States,  etc. 


Individual 
income  and 

employ- 
ment taxes 


Corpora- 
tion income 
taxes 


Excise  taxes 


Estate  and 
gift  taxes 


Total 
collections 


Refunds  of 
taxes 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado.    . 

Connecticut 

Delaware 

Florida 

Georgia 

Hawaii 

Idaho. 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland  ' 

Massachusetts 

Michigan 

Miimesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Plampshire... 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wiscon.sin 

Wyoming 

International  3 

Undistributed: 

Depositary  receipts  < 

Transferred  to  Govern- 
ment of  Guam 

Withheld  taxes  of  Federal 
employees « 

Unclassified 


457 

59, 

278 

196. 

6.071 
877, 

1, 084 
331 

1. 027, 
713 
186 
136 

4.  728, 

1,372 
558, 
477, 
451 
528, 
179 

1,601 

1.912 

3.116 

1,004 
192 

1,425 
124 
415 
110 
154 

1,948 

174 

10, 207, 

723 

90 

3,645 
514 
485 

4,117 

274 

282 

98, 

588 

2,131 
197 
75 


764,  530 
830,  570 
2.57,147 
1,  085,  549 


71 


-277, 

-4: 

392 


849 
330 
920 
251 
062 
438 
375 
964 
250 
828 
599 
022 
931 
480 
076 
940 
205 
564 
185 
Oil 
599 
177 
353 
040 
956 
701 
086 
757 
153 
020 
855 
992 
177 
046 
453 
.527 
194 
728 
653 
125 
894 
903 
707 
532 
310 


201 


205,  974 


136, 233 

4,401 

54,  523 

34.  405 

1,380.810 

136,743 

335,  272 

468. 421 

237.  746 

237,115 

42.  657 

26.  400 

1,860.894 

340. 203 

150.378 

126.  788 

166.769 

150.944 

45,  295 
291.790 
581.676 

2,112,608 
348, 088 

32. 276 
554,  508 

24,  696 

94,  504 

23.016 

30,  952 
620,  576 

22. 964 

5, 836. 035 

384,191 

10,  732 

1,475,718 

178.0,52 

87,  948 
1,  236,  659 

67, 197 
101, 905 

1.5,975 
15,5.762 
622. 076 

46,  528 
12, 662 

217,403 
171,797 

51.392 

389,  263 

9,007 

20,  987 


16 
1 

7, 

8, 

845, 

89, 

126. 

2, 

82, 

116, 

8, 

3 

838, 

3.55, 

32 

25, 

1,006. 

83 

5, 

271 

173 

1,629. 

108. 

12, 

254, 

4 

51 

12, 

3, 

296, 

7. 

1,797 

1,238 

3, 

597 

225, 

16, 

737. 

17, 

14 

4. 

38. 

266. 

16. 

4. 

406, 

64 

15. 

157. 

9, 

30, 


-81,  639 


9,733 

187 

9,985 

5,290 

188,  405 

19.1.55 

64.  235 

10,806 

50.  593 

13.023 

4.  533 

2,263 

128,  700 

26.  827 

12.949 

18.  622 

12,  987 

21,690 

12.  496 

38. 106 

81,065 

58.  372 

35.  783 

4,761 

36. 345 

2,  965 
10. 345 

3,582 

6,009 
94,  958 

4.627 
392,  331 
20,  462 

1,742 
81,112 
20. 261 

9. 336 

154.535 

17,  496 

9.  574 

3.132 
15,298 
89.  551 

2.485 

3.  695 
20. 848 
24. 064 

7.996 
36, 095 

1,569 
15,412 


620. 448 

65. 886 

350.  732 

244.  023 

8.486.217 

1,122,545 

1,610.023 

813.  704 

1,398,537 

1,080,790 

242,  3,58 

168,6,54 

7,  556,  673 

2,  094,  585 

754,  375 

648,510 

1,637,919 

784,  426 

242, 125 

2, 202,  372 

2.  748,  822 

6,916,466 

1,496.430 

241,794 

2, 271 ,  508 

157,249 

571,266 

150,142 

194.367 

2,  959,  849 

209,  689 

18,234,140 

2,  366, 242 

10.5,617 

5,800.161 

938,  290 

599,  006 

6,  246.  579 

376,  478 

407,  989 

122,  696 

798,  329 

3,110,047 

263,  516 

9.5, 841 

1,409,647 

1,091.2,55 

332.181 

1,  668,  706 

90,813 

272,  441 

-359, 505 

-4,  464 

392,  595 


Total. 658,655,452 


21, 764,  940 


712,064,302 


94, 401, 086 


69, 363 

7,006 

39.  920 

30.  383 

775,  426 
60, 639 
88, 681 
12.  709 

155,736 

87.  070 

22. 258 

18, 189 

3.59, 132 

121. 774 

71,725 

60. 197 

60.158 

76.860 

24.181 

134.769 

197.903 

286.  503 

117.409 

33. 057 

13.5,233 

17,8.52 

32,286 

12,  380 

16,710 

226,917 

25.  799 

776,  919 
96,  976 
14,302 

333.  557 
66,  672 
58.  590 

360,  275 
28,  574 
44,  972 
14,  534 
76, 145 

251.356 

30,  364 

9.127 

97, 902 

10.5.345 
37,  963 

124.260 

9,571 

31,595 


1,085 


8  5, 948, 309 


1  It  should  be  emphasized  that  collections  in  the  various  States  do  not  necessarily  indicate  the  Federal 
tax  burden  of  the  respective  States,  since  the  taxes  collected  in  one  State  are,  in  many  instances,  borne  by 
residents  of  other  States.    Likewise,  payments  of  refunds  within  a  State  may  not  be  applicable  to  the 


TABLES 


497 


collections  within  that  State,  since  refunds  are  payable  in  the  State  of  residence  or  principal  place  of  busi- 
ness of  the  taxpayer  which  may  not  be  the  point  at  which  collections  are  made. 

2  Includes  the  District  of  Columbia. 

3  Collections  from  and  refunds  to  U.S.  taxpayers  in  Puerto  Eico,  Canal  Zone,  etc.,  and  in  foreign  countries. 
*  Consists  of  all  those  issued  during  the  fiscal  year  minus  those  received  with  tax  returns  which  are  in- 
cluded in  the  State  totals. 

5  Net  transactions  in  the  clearing  account  on  the  central  books  of  the  Treasury  for  withheld  income  taxes 
from  salaries  of  Federal  employees. 

8  Includes  $12.5  billion  transferred  to  the  Federal  old-age  and  survivors  insurance  trust  fund,  the  Federal 
disabiUtv  insurance  trust  fimd,  and  the  railroad  retirement  account  as  provided  by  the  Social  Security 
Act,  as  amended  (42  U.S.C.  401  (a)  (b))  and  the  Railroad  Retirement  Act  (45  U.S.C.  228e(k:))  for  benefit 
payments  within  the  States. 

7  Includes  $2.9  billion  gasoline  and  certain  other  highway  user  levies  transferred  to  the  highway  trust 
fund  for  highway  construction  in  the  States,  in  accordance  with  the  act  approved  June  29,  1956  (23  U.S.C. 
120  note). 

8  Xot  reduced  by  the  reimbursement  of  $224  million  to  the  general  fund  from  the  Federal  old-age  and  sur- 
vivors insurance  trust  fund,  the  Federal  disability  insurance  trust  fund,  the  highway  trust  fund,  and  the 
Federal  Unemployment  Tax  Act  (42  U.S.C.  1101  (b)  (3));  the  estimated  aggregate  of  refunds  due  on  the 

taxes  collected  and  transferred. 

Note.— Collections  in  full  detail  by  tax  source  and  region  are  shown  in  the  Annual  Report  of  the  Com' 
missioner  of  Internal  Revenue  and  in  lesser  detail  in  the  Combined  Statement. 


Table  19. — Customs  collections  and  refunds,  fiscal  years  1960  and  1961 
[On  basis  of  Bureau  of  Customs  accounts] 


Percentage 
increase,  or 
decrease  (— ) 


Collections: 
Duties: 

Consumption  entries 

Warehouse  withdrawals- 

Mail  entries 

Baggage  entries 

Informal  entries 

Appraisement  entries 

Supplemental  duties 

Withheld  duties 

Other  duties 


Total  duties - 


Miscellaneous:  i 

Violations  of  customs  laws 

Marine  inspection  and  navigation  services- 
Testing,  inspecting,  and  grading 

Miscellaneous  taxes 

Fees. 

Unclaimed  funds 

Recoveries 

Sale  of  Government  property 

All  other  customs  receipts 


Total  miscellaneous. 


Total  customs  collections- 


Refunds: 

Excessive  duties  and  similar  refunds. 
Drawback  payments 


Total  refunds- 


$927, 

159, 

10, 

2, 


422, 414 
738, 961 
223, 116 
601, 214 
033, 985 
329,  678 
894,  572 
203, 893 
589,  746 


997,  619 
883, 285 
719, 099 
506,350 
992, 908 
152, 460 
181,071 
172, 358 
150, 064 


1, 123, 037,  579 


1, 007,  755, 214 


1, 402, 084 
30, 603 

479, 422 

4, 268, 810 

228, 650 

4S,  045 

15,602 

1,061,515 

27,  797 


7,  562,  528 


1, 130,  600, 107 


9, 902, 339 
8,  581, 052 


18, 483, 391 


,  590, 364 

31,  764 

514, 315 

,  529,  490 

233, 171 

51,012 

13, 332 

,  915,  775 

32, 959 


8, 912, 182 


1,016,667,396 


13, 843, 869 
11,  595, 663 


25, 439,  532 


-13.2 

2.0 

4.9 

-3.6 

11.9 

-53.8 

25.5 

-15.5 

-27.7 


-10.3 


13.4 
3.8 
7.3 
6.1 
2.0 
6.2 
-14.5 
80.5 
18.6 


17.8 
-10.1 


39.8 
35.1 


37.6 


1  Includes  miscellaneous  customs  collections  of  Puerto  Rico  and  the  Virgin  Islands  and  those  of  other 
Government  agencies. 


498    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  20. — Deposits  by  the  Federal  Reserve  Banks  representing  interest  charges  on 
Federal  Reserve  notes,  fiscal  years  1947-61  i 


Federal  Reserve 
Bank 

1947-r)8 

1959 

1060 

1961 

Cumulative 
through  1961 

Boston 

$187,510,033.25 
820, 226, 129.  42 
204, 868, 751. 19 
292, 522, 052.  77 
200, 068, 326. 88 
168, 242,  559.  80 
551, 568, 328.  56 
144, 278, 700. 68 
82, 769, 046.  27 
142, 420,  544. 93 
119, 104, 394. 17 
321,092,430.74 

$24,791,243.50 
130, 304,  518. 13 
2S,  615,  921.  81 
43,  026,  591.  51 
31, 271, 236. 00 
22, 799, 293, 27 
90, 095, 997.  31 
18,039,401.46 
8,  572, 250.  85 
20,  631, 083. 19 
17, 338, 035.  47 
55,  735, 036. 38 

$65,177,632.98 
271, 042, 719. 10 

72,  840, 095.  47 
90, 521, 189.  66 

73,  461, 162.  64 
51,754,685.08 

199,656,095.46 
47, 750, 266.  32 
26.147,203.49 
45, 065, 009.  <12 
37,930,193.44 

111,761,165.15 

$41, 194, 897. 08 

212, 079, 944. 17 

45,  886, 308.  09 

66,  597,  471. 42 

49. 090. 076. 11 
39,571,839.00 

139,200,110.57 
29,  706, 375.  68 
16,489,015.59 
32,  574, 465.  45 
29,  729,  590.  74 

86. 009. 391. 12 

$318,  673, 806. 81 

New  York 

Philadelphia 

Cleveland 

Richmond 

.\tlanta 

Chicago 

1, 433,  653, 310.  82 
352,211,076.56 
492,  667, 305. 36 
353, 890, 801.  63 
282, 368, 377. 15 
980. 520,  531. 90 
239,  774, 744. 14 

Minneapolis 

Kansas  City - 

Dallas    ...  

133,977,516.20 
240.  691, 102.  99 
204, 102, 213.  82 

San  Francisco 

574, 598, 023.  39 

Total 

3. 234,  671, 298.  66 

491,  220,  608.  88 

1,093,107,418.21 

788, 129. 485. 02 

5,  607, 128,  810.  77 

'  Pursuant  to  sec.  16  of  the  Federal  Reserve  Act,  as  amended  (12  U.S.C.  414).  Through  1959,  consisted  of 
approximately  90  percent  of  earnings  of  the  Federal  Reserve  Banks  after  payment  of  necessary  expenses 
and  statutory  dividends,  and  after  provisions  for  restoring  the  surplus  of  each  bank  to  100  percent  of  sub- 
scribed capital  where  it  fell  below  that  amount.  Beginning  in  1960,  pursuant  to  a  decision  by  the  Board  of 
Governors  of  the  Federal  Reserve  System,  consists  of  all  net  earnings  after  dividends  and  after  provision  for 
building  up  surplus  to  100  percent  of  subscribed  capital  at  those  banks  where  surplus  is  below  that  amount, 
and  also  of  the  amounts  by  which  surplus  at  the  other  banks  exceeds  subscribed  capital. 


TABLES  499 

Table  21. — Postal  receipts  and  expenditures,  fiscal  years  1916-61  ' 


Year 


1916  .. 
1917... 
1918  .. 
1«19... 
1920... 

1921... 
1922  .. 
1923... 
1924  .. 
1925... 

1926... 
1927... 
1928... 
1929... 
1930  .. 

1931-  . 
1932... 
1933... 
1934... 
1935.  . 

1936... 
1937... 
1938... 
1939... 
1940.  . 

1941... 
1942  .. 
1943... 
1944. 
1945.. 

1946... 
1947  .. 
1948... 
1949  .. 
1950... 

1951... 
1952... 

1953  . 

1954  '. 

1955  ». 

1956  '. 

1957  '. 

1958  '. 

1959  '-. 

19(iO'. 
]9(il  7. 


Postal  revolving  fund  a?  reported  to  the  Treasury  by  the 
Post  OfTice  Department 


Postal  rev- 
enues 


$312, 057.  689 
329.  7?6  115 
388,  975,  962 
436, 239. 126 
437, 150,  212 

463,  491, 275 
484,  853,  541 
532,  827,  925 
572, 948,  778 
599,  591,  478 

659,  819,  801 
683, 121. 989 
693.  6.33, 921 
696,  947,  578 
705, 484, 098 

656,  463, 383 
588.171,923 
587,631,364 
586,  733, 166 
6.30,  795,  302 

665,  343, 356 
726.201,110 
728.  634, 051 
745,  955, 075 
766, 948,  627 

812,  827,  736 

859,817.491 

966.  227, 289 

1,112,877,174 

1, 314, 240, 132 

1, 224,  572. 173 
1.299,  141,041 
1,410,971,284 
1, 571,  851,  202 
1, 677,  486, 967 

1, 776,  816. 354 
1,947,316,280 
2,091,714.112 
2,  263,  389,  229 
2, 336, 667,  658 

2,419.211,749 
2,  547,  589,  618 

2,  583, 459,  773 

3,  061, 110.  753 
3.  334. 343, 038 
3,  482.  961,  182 


Postal  expenditures ' 


Extraordinary 
expenditurps 
as  reported 
under  act  of 
June  9,  1930 


$39,  669, 718 

48. 047,  308 
53,  304,  423 
61.691,287 
66,  623, 130 
69,  537. 252 

68,  585, 283 
51,  587, 336 
42,  799,  687 
48,  540.  273 
53. 331, 172 

58, 837,  470 
73,916,128 
122,  343,  916 
126,  639,  650 
116,198,782 

100, 246, 983 
92, 198,  225 
96, 222, 339 
120,118,663 
119,960,324 

104, 895, 553 
107, 209,  837 
103, 445,  741 

(') 

(') 

(•) 

(8) 
(•) 

m 


other 


$306.  228.  453 
319.  889,  904 
324.  849. 188 
362.  .504.  274 

s  418,  722, 295 

»  619,  634.  948 
«  545.  662.  241 
«  556.  893, 129 
»  587,412.7.55 
5  639,  336,  505 

5  679, 792, 180 
714,628,189 
725,  755,  017 
782, 408,  754 
764, 030, 368 

754,  482,  265 
740,418,111 
038,314,969 
564,143,871 
627, 066, 001 

685,  074,  398 
721,  228.  506 
729,645,920 
736.  106, 665 
754,  401,  694 

778, 108,  078 
800,  040,  400 
830,191,463 
942,  345, 968 

1. 028,  902,  402 

1, 253,  406,  696 
1,  412,  600,  531 

1,  591,  583, 096 

2. 029,  203,  465 
2. 102, 988, 758 

2,  236,  503,  513 
2,  559,  650,  534 
2,  638,  680,  670 

2,  575,  386,  760 
2, 692,  966. 698 

2, 882, 291, 063 
3,065,126,065 

3,  257, 452,  203 
3, 834,  997,  671 
3,821,959,408 
4. 347,  945,  979 


Surplus,  or 
deficit  (-) 


$5,  829.  236 
9.  836.  212 
64. 126.  774 
73.  734.  862 
18.427,917 

-156.  143.673 
-60.  808,  700 
-24, 065,  204 
-14,463,976 
-39,  745, 027 

-19,972,379 
-31,506,201 
-32,121,096 
-85,461,176 
-98,  215,  987 

-146,066.190 
-205.550.611 
-112,374,892 
-44,033,835 
-65,807,951 

-8S.  316,  324 
-46,  614,  732 
-4.3,811,5,56 
-38,  691, 863 
-40,784,239 

-24,117,812 

-14,139,037 

13.  691, 909 

43, 891, 556 

169, 138, 948 

-129,081,506 
-205,  657, 715 
-276, 834, 152 
-577,470,926 
-545.462,114 

-564,582,711 
-719,544,090 
-650,412,299 
-311,997,531 
-356,299,040 

-463,079,314 

-517,536,447 
-673,992,431 
-773, 886, 918 
-487,616,370 
-864.984,797 


Surplus  rev- 
enue paid 
into  the 
Treasury  ' 


$5. 200,  000 

48.  630.  701 

89,  906, 000 

5,  213, 000 


81, 494 


1,000,000 
188, 102, 579 


12, 000, 000 


Advances 

from  the 

Treasury  to 

cover  postal 

deficiencies  • 


$5, 500, 000 


2,221,095 

343,511 

» 114,  854 

•  130, 128,  458 
«  64, 346.  235 
«  32,  626,  915 
»  12,  638,  850 
«  23,  216, 784 

»  39,  606. 490 
27. 263, 191 
32.  080,  202 
94.  699,  744 
91,714,451 

146,643.613 

202, 876, 341 

117,380,192 

52, 003, 296 

63, 970, 405 

86, 038,  862 
41,  896, 945 
44, 258, 861 
41, 237, 263 
40,  870,  336 

30, 064, 048 

18,  308. 869 

14, 620,  875 

«  -28, 999. 995 

649,  769 

160, 572, 098 
241,  787, 174 
310, 213,  451 
524,  297, 262 
592, 514, 046 

624, 169, 406 
740, 000, 000 
660,121,483 
521, 999.  804 
285, 261, 181 

382.311,040 
516,  502,  460 
921,  750,  883 
605, 184, 335 
569,229.167 
824,  989,  797 


'  Kor  figures  from  1789  through  1915  see  annual  report  for  J946,  p.  419. 

'  Includes  adjusted  losses,  etc.,  postal  funds  and  expenditures  from  postal  balances,  but  excludes  depart- 
mental expenditures  in  'Washington,  D.  C.  through  1922,  and  amounts  transferred  to  the  civil  service  retire- 
ment and  disability  fund,  1921  through  1926.  From  1927  to  date  includes  salary  deductions  paid  to  and  de- 
posited for  credit  to  the  retirement  fund. 

'  On  basis  of  warrants-issued  adjusted  to  basis  of  daily  Treasury  statements  through  1947. 

*  Advances  to  the  Postmaster  General  to  meet  estimated  deficiencies  in  postal  revenues,  reduced  by  repay- 
ments from  prior  year  advances.  E.xcludes  allowances  for  offsets  of  extraordinary  e.xpenditures  or  the  cost 
of  free  mailings.  Figures  are  on  basis  of  warrants- issued  adjusted  to  basis  of  daily  Treasury  statements 
through  1953,  and  thereafter  on  basis  of  the  central  accounts  of  the  U.  S,  Government  maintained  by  the 
Treasury  Department. 

» Excludes  payments  from  general  ftmd  appropriation  "Additional  Compensation,  Postal  Service," 
pursuant  to  act  of  November  8,  1919,  as  follows:  1920,  $35,698,400;  1921,  $1,374,015;  and  1922,  $6,700.  Also 
excludes  transfers  to  the  civil  service  retirement  and  disability  fund  on  account  of  salary  deductions,  as 
follows:  1921,  $6,519,683;  1922,  $7,899,006;  1923,  $8,284,081;  1924,  $8,679,658;  1925,  $10,266,977;  and  1926, 
$10,472,289  (see  note  2). 

«  Repayment  of  unexpended  portion  of  prior  years'  advances. 

'  Transactions  for  1954  through  1961  are  on  the  basis  of  cash  receipts  and  expenditures  as  reported  by  the 
Post  Office  Department.    Reports  of  the  Postmaster  General  are  on  a  modified  accrual  basis. 

*  See  letter  of  the  Postmaster  General  in  exhibits  in  annual  reports  prior  to  1958. 

»  Under  the  act  of  May  27,  1958  (72  Stat.  143),  the  Postmaster  General  is  no  longer  required  to  certify  the 
estimated  amounts  of  postage  that  would  have  been  collected  on  certain  free  or  reduced-rate  mailings. 


500   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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79, 281 
74, 288 
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TABLES  507 

Public  Debt,  Guaranteed  Obligations,  Etc. 

I. — Outstanding 

Table  23. — Principal  of  the  public  debt,  1790-1961 

[On  basis  of  Public  Debt  accounts  from  1790  through  1915,  and  on  basis  of  daily  Treasury  statements  from 
1916  to  date,  see  "Bases  of  Tables"  and  NoteT 


Date 


December  31 — 

1790 

1791 

1792 

1793 

1794 

1795 

1796 

1797 

1798 -. 

1799 

1800 

1801 

1802 

1803 

1804 

1805 

1806 

1807 

1808 

1809 

1810 

1811 


Total  gross 
debt 


$75, 463, 

77. 227, 
80, 358, 
78,  427, 
80,  747, 
83,  762, 
82, 064, 

79. 228, 
78, 408, 
82, 976, 
83, 038, 
80, 712, 
77, 054, 
86, 427, 
82.312, 
75, 723, 
69, 218, 
65, 196, 
57, 023, 
,53, 173, 
48, 005, 
45, 209, 


Date 


December  31 — 

1812 

1813 - 

1814 

1815 

1816 

1817 

1818 

1819 

1820 

1821 

1822 

1823 

1824 

1825 

1826 

1827 

1828 

1829 

1830 

1831 

1832 


Total  gross 
debt 


$55, 962, 828 
81,  487, 846 
99,  833,  660 
127, 334, 934 
123,491,965 
103, 466, 634 
95,  529, 648 
91, 015,  566 

89,  987, 428 
93,  546,  677 

90,  875,  877 
90, 269, 778 
83,  788,  433 
81, 054, 060 
73,  987, 357 
67, 475, 044 
58, 421,  414 
48,  565, 407 
39, 123, 192 
24, 322, 235 

7,  Oil,  699 


Date 


December  31 

18.33 

18-34 

183.5 

1836 

1837 

1838 

1839 

1840 

1841 

1842 

June  30— 

1843 

1844 

1845 

1846 

1847 

1848 

1849 

1850 

1851 

1852 


Total  gross 
debt 


$4, 760, 082 

37, 733 

37, 513 

336, 958 

3, 308, 124 

10,  434,  221 

3,  573, 344 

5, 250, 876 

13,  594,  481 

20,201,226 

32,  742, 922 
23, 461,  653 
15, 925, 303 
15, 550, 203 
38, 826,  535 
47, 044, 862 
63, 061, 859 
03, 452, 774 
68, 304, 796 
66, 199, 342 


June  30 


Interest-bearing  i 


Matured  debt 
on  which  inter- 
est has  ceased 


Debt  bearing 
no  interest 


Total  gross  debt 


Gross  debt 
per  capita  2 


1853. 
1854. 
1855. 
1856- 
1857- 
1858. 
1859. 
1860- 
1861- 
1862. 
1863. 
1864- 
1865- 
1866. 
1867. 


1870. 
1871. 
1872. 
1873- 
1874. 
1875. 
1876. 
1877. 
1878. 
1879. 


1881. 
1882- 
1883. 
1884. 
1885- 
1886. 
1887. 


1889 

1890 

1891 

1892 

1893 

1804 

1895 

1896 

1897 

1898 

1899 - 

1900 

Footnotes  at  end  of  table, 
614359 — 62- 


$59, 642,  412 

42,044,517 

35,418,001 

31, 805, 180 

28, 503, 377 

44, 743, 256 

58, 333, 156 

64, 683, 256 

90, 423, 292 

36.5,356,045 

707, 834, 255 

1, 360, 026, 914 

2, 217, 709, 407 

2,322,116,330 

2, 238, 954, 794 

2, 191, 326, 130 

2,151,495,065 

2, 035, 881, 095 

1, 920,  696, 750 

1, 800, 794, 100 

1,696,48-3,950 

1, 724, 930, 750 

1, 708,  676, 300 

1,  696,  685, 450 

1, 697, 888, 500 

1, 780,  735, 650 

1,887,716,110 

1,709,993,100 

1,  625,  567, 750 

1, 449,  810, 400 

1,324,229,150 

1, 212,  563, 850 

1,182,150,9.50 

1, 132, 014, 100 

1,007,692,350 

936, 522, 500 

815, 853, 990 

711.313,110 

610, 529, 120 

585,029,330 

58,5,037,100 

635, 041, 890 

716,202,060 

847, 363, 890 

847, 365, 130 

847, 367, 470 

1, 046, 048,  750 

1,023,478,860 


-33 


$162,  249 

199, 248 

170,  498 

168, 901 

197, 998 

170, 168 

165, 225 

160,  575 

159, 125 

230,  520 

171,970 

365, 629 

2, 129,  425 

4, 435,  865 

1, 739, 108 

1,246,  .334 

5,112,034 

3, 569, 664 

1,  948, 902 
7, 926, 547 

51,929,460 
3, 216, 340 

11,425,570 
3,902,170 

16,  648, 610 
5, 594, 070 

37, 015, 380 
7, 621, 205 
6,723,615 

16,260,555 
7,831,165 

19, 655,  955 
4, 100, 745 
9, 704, 195 
6,114,915 

2,  495,  845 
1,911,235 
1,  815, 555 
1, 614, 705 
2, 785, 875 
2. 094, 060 
1,851,240 
1,721,590 
1, 636, 8t0 
1, 346, 880 
1, 262, 680 
1, 218, 300 
1, 176, 320 


$i58,  .591, 390 
411,767,4,56 
455,  437, 271 
458, 090,  ISO 
429,211,734 
409,  474, 321 
390, 873, 992 
388, 503, 491 
397, 002, 510 
399, 406, 489 
401,  270, 191 
402, 796, 935 
431,785,640 
436, 174, 779 
430,258,158 
393, 222. 793 
373, 088, 595 
374, 181, 153 
373, 294, 567 
386, 994, 363 
390, 844,  689 
389, 898, 603 
393, 087, 639 
392. 299, 474 
413,941,255 
451,678,029 
44.5, 613, 311 
431,  705, 286 
409, 267, 919 
393, 662, 736 
380,  403, 636 
374, 300, 606 
380, 004,  687 
378,  989, 470 
373,  728. 570 
378,081,703 
384, 112,  913 
389, 433, 654 
238,  761, 733 


$59,  804, 661 

42, 243, 765 

35,  588,  499 

31, 974, 081 

28, 701, 375 

44, 913, 424 

58,  498, 381 

64, 843, 831 

90, 582, 417 

524, 177, 955 

1,119,773,681 

1,815,830,814 

2, 677, 929, 012 

2, 755, 763, 929 

2,  650, 168, 223 

2, 583, 446, 456 

2,54,5,110,590 

2, 436, 453, 269 

2,322,052,141 

2, 209, 990, 838 

2,151,210,345 

2,159,932,730 

2, 156, 276, 649 

2, 130, 845, 778 

2,107,759,903 

2,159,418,315 

2, 298, 912, 643 

2, 090, 908, 872 

2, 019, 285, 728 

1,856,915,644 

1,721,958,918 

1,  625, 307, 444 

1, 578, 651, 169 

1,  555,  659, 550 

1, 465, 485, 294 

1, 384,  631,  656 

1,249,470,511 

1, 122, 396, 584 

1, 005, 806, 561 

968, 218, 841 

961, 431, 766 

1,016,897,817 

1, 096, 913, 120 

1, 222, 729, 350 

1,226,793,713 

1,232,743,063 

1, 436, 700, 704 

1, 263, 416, 913 


$2.32 
1.59 
1.30 
1.13 
.99 
1.50 
1.91 
2.06 
2.80 
15.79 
32.91 
52.08 
75.01 
75.42 
70-91 
07.61 
65-17 
61.06 
56.72 
52.65 
50.02 
49.05 
47.84 
46.22 
44.71 
44.82 
46.72 
41.60 
39.18 
35.16 
31.83 
29.35 
27.86 
26.85 
24.75 
22.89 
20.23 
17.80 
15.63 
14.74 
14.  36 
14.89 
15.76 
17.25 
16.99 
16.77 
19.21 
16.60 


508        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
Table  23. — Principal  of  the  public  debt,  1790-1961 — Continued 


June  30 

Interest-bearing  • 

Matured  debt 
on  which  inter- 
est has  ceased 

Debt  bearing 
no  interest 

Total  gross  debt' 

Gross  debt 
per  capita' 

1901 

987,141,040 

931, 070,  340 

914.541,410 

895, 157, 440 

895,158,340 

895, 159, 140 

894,  834,  280 

897, 503, 990 

913, 317, 490 

913, 317, 490 

915, 353, 190 

963, 776,  770 

965,  706, 610 

967, 953,  310 

969,  759, 090 

971, 562, 590 

2, 712,  549.  477 

12, 197,  507, 642 

25, 236, 947, 172 

24, 062,  500,  285 

23,  738, 900, 085 

22,  710,  338. 105 

22, 007,  043,  612 

20, 981.  242, 042 

20,  210,  906,  915 

19, 383,  770, 860 

18,  252,  664,  666 

17,317,694,182 

16,638,941,379 

15,  921,  892, 350 

16,  519,  588.  640 
19,161,273,540 
22, 157, 643, 120 
26,  480,  487, 870 
27,645,241,089 
32, 988,  790, 135 
35,800,109,418 
36,  575,  925,  880 
39,  885,  969, 732 
42, 376, 495, 928 
48, 387,  399, 539 
71,968,418,098 

135,380,305.795 
199,  543,  355, 301 
256,  356, 615, 818 
268,110,872.218 
255,113,412,039 
250, 063,  348, 379 
250,761,636,723 

255,  209, 353, 372 
252, 851,  765, 497 

256,  862,  861, 128 
263, 946, 017,  740 

268,  909, 766,  654 
271,741,267,507 

269,  883, 068, 041 
268,  485,  562,  677 
274.  697.  560.  009 
281. 833, 362,  429 
283.  241, 182, 755 
285, 671, 608, 619 

1, 415, 620 

233, 015,  585 
245. 680, 157 
243,  659.  413 
239, 130,  656 

235,  828,  510 
246,  235,  695 
251,  257, 098 
276, 056, 398 
232, 114, 027 
231, 497, 584 
236,751,917 
228,  301,  285 
225,  681,  585 
218, 729, 530 
219,997,718 
252, 109,  877 
248,  836,  878 
237,  475, 173 

236,  3^2,  7.'^8 
230, 075, 945 
227, 862, 308 
227,  792.  723 
243,  924,  844 
239, 292,  747 
275,  027,  993 
246, 085,  555 
244, 523,  681 
241,  263,  959 
241,397,905 
231,700,611 
229. 873,  756 
265, 649,  519 
315,118,270 
518, 386, 714 
824,  989, 381 
620,  389, 964 
505, 974,  499 
447,451,975 
411.279,539 
386,443.919 
369,044,137 
355, 727,  288 

1,175,284,445 
1,259,180,760 
2, 056,  904, 457 
934,  820, 095 
2,942,057,534 
1,949,146,403 
1,  763, 965, 680 
1, 883,  228, 274 
1,  858, 164, 718 
1,823,625,492 
1,826,623,328 
1,912,647,799 
2,044.353,816 
2.201.69.3.911 

1,  512,  367,  635 
1,048,332,847 
2, 396, 089,  647 

2,  644, 969.  463 
2,949,974,782 

1,221,572,245 

1,178,031,357 

1,159,405,913 

1,136,259,016 

1,132,357,095 

1, 142, 522,  970 

1, 147, 178, 193 

1,177,690,403 

1,148,315,372 

1,146,939,969 

1,153,984,937 

1, 193,  838,  505 

1,193,047,745 

1, 188,  235,  400 

1,191,264,068 

1, 225, 145, 568 

2, 975,  618,  585 

12, 455, 22,5,  365 

25,  48-1,  500, 160 

24,299,321,467 

23, 977,  450, 553 

22,  963, 381,  708 

22, 3!9,  707, 365 

21,2.50,812,989 

20,516,193,888 

19,643,216,315 

18,511,906.932 

17, 604, 293,  201 

16,931,088,484 

16, 185, 309, 831 

16,801,281,492 

19,487,002,444 

22,  538,  672, 560 

27,053,141,414 

28,  700,  892,  625 

33, 778,  543, 494 

36,  424,  613,  732 

37,164,740,315 

40,439,532,411 

42,967,531,038 

48, 961, 443,  536 

72,422,445,116 

136,  696, 090, 330 

201,003,387,221 

258,682,187,410 

269,  422, 099, 173 
258,  286, 383, 109 
252,  292.  246.  513 
252.  770.  359,  860 
257,357,352.351 
255,221,976,815 
259,105,178,785 
266,071,061,639 
271, 259,  .599, 108 
274, 374, 222,  803 
272,  7,50,  813,  649 

270,  ,527, 171, 896 
270,343,217,746 
284, 705. 907, 078 
286, 330,  760, 848 
288, 970, 938, 610 

15.74 

1902 

1,280 

1,205 

1,970 

1,370 

1,128 

1,086 

4,130 

2,883 

2,124 

1,879 

1,760 

1,659 

1,552 

1,507 

1,473 

14,  232 

20, 242 

11,176 

6,745 

10,  688 

25,  250 

98,  738 

30,  278 

30,  258 

13, 359 

14,718 

45, 335 

50,  749 

31,716 

51,819 

60,079 

65,911 

54,  266 

230, 662 

169,363 

118,529 

141,362 

142,283 

204.  591 

204,  999 

98, 299 

140,600 

200, 851 

268,  667 

376, 406 

230, 913 

279,  751 

244, 757 

264,  770 

512,046 

418, 692 

298,  420 

437, 184 

588,  601 

666,  051 

529,  241 

,597,  324 

476, 455 

444,  608 

349, 355 

860 
090 
920 
245 
135 
815 
015 
855 
895 
830 
450 
550 
560 
260 
100 
230 
550 
2.-)0 
237 
160 
880 
910 
200 
980 
900 
585 
060 
199 
870 
095 
385 
170 
830 
155 
395 
815 
460 
140 
190 
860 
730 
090 
160 
135 
860 
536 
730 
458 
705 
600 
165 
570 
655 
480 
697 
585 
889 
003 
630 

?n9 

14.88 

1903     

14.38 

1904 

13.83 

1905. - 

13.51 

1906 

13.37 

1907 - 

13.19 

1908     

13.28 

1909 

12.  69 

1910 - 

12.41 

1911 

12.29 

1912 

12.52 

1913.-. 

12.27 

1914              

11.99 

1915 

11.85 

1916- 

12.02 

1917     

28.77 

1918 

119.13 

242  66 

1920 

228. 23 

1921 

220.91 

1922              

208.  65 

1923-. 

1924 --. 

199. 64 
186.211 

177.12 

1926  

167.32 

1927                  

155  51 

1928              -- 

1 46.  09 

139.04 

1930 

131  51 

1931.         .  - 

135.45 

1932 

1,56.10 

1933              

179.48 

1934     -.- 

214.07 

22,5.  55 

1936                  

263.  79 

1937     .     

282  76 

1938 

286  27 

1939       

308  98 

1940  

325.  23 

367.  09 

1942     

537. 13 

1943 

999. 83 

1944.. 

1945 

1, 452.  44 
1, 848.  60 

1946... 

1,  905.  42 

1,  792. 06 

1948 

1,720.71 

1949.. 

1,  694.  75 

1950              

1,696.68 

1951 

1, 6.5.3. 42 

1952 

1,6,50.06 

1953 — . 

1,666.74 

1954 

1, 670. 14 

1955 

1,660.16 

1956 

1,621  82 

1, 580.  20 

1958 

1959_ 

I960. 

'  1.. 587. 63 
'1,606.14 
M.. 584. 83 

1961 

M,  673. 49 

'  Revised. 

'  Exclusive  of  bonds  issued  to  the  Pacific  railroads  (acts  of  1862,  1864,  and  1878),  since  statutory  provision 
was  made  to  secure  the  Treasury  against  both  principal  and  interest,  and  the  Navy  pension  fund,  which 
was  not  a  debt  as  principal  and  interest  were  the  property  of  the  United  States.  The  Statement  of  the 
Public  Debt  included  the  railroad  bonds  from  issuance  and  the  Navy  fund  from  September  1, 1866,  through 
June  30,  1890. 

>  Pee  table  24,  footnote  4. 

'  Includes  certain  obligations  not  subject  to  st.atutory  limitation;  see  table  1,  notes  6  and  7.  Public  debt 
includes  debt  incurred  to  finance  expenditures  of  certain  wholly  owned  Government  corporations  and  other 
busincss-type  activities  in  exchange  for  which  obli?ations  of  the  corporations  and  activities  were  issued 
to  the  Treasury  (see  table  124). 

<  Subject  to  revision. 

Note.— From  1789-1842,  the  fiscal  year  ended  December  31;  from  1843,  on  June  30.  Detailed  figures  for 
1790-1852  are  not  available  on  a  basis  comparable  with  those  of  later  years.  The  amoimts  for  1790-1852, 
except  for  1835,  are  from  the  1900  annual  report  of  the  Secretary  of  the  Treasury;  for  1835,  from  the  1834-35 
annual  reports,  pp.  504  and  629;  for  1853-85,  from  the  "  Statement  of  Receipts  and  Expenditures  of  the  Gov- 
ernment from  1855  to  1885  and  Principal  of  Public  Debt  from  1791  to  1885"  compiled  from  the  Register's 
official  records;  from  1886-1915,  from  the  monthly  debt  statements  and  revised  figures  in  annual  reports; 
and  since  1910,  from  the  "  Statement  of  the  Public  Debt"  in  the  daily  Treasury  statements. 


TABLES 


509 


Table  24. — Public  debt  and  guaranteed  obligations  outstanding  June  SO,  1934-61 

[Gross  public  debt  on  basis  of  daily  Treasury  statements.  Guaranteed  obligations  from  1934  through 
1939  on  basis  of  Public  Debt  accounts,  and  for  1940  and  subsequent  years  on  basis  of  daily  Treasury  state- 
ments] 


Guaranteed  obligations  held  outside  the 

Total  gross  public  debt  and 

June  30 

Gross  public 
debti 

Treasury » 

guaranteed  obligations  ' 

Interest-bearing 

Matured  s 

Total 

Total 

Per  capita  ♦ 

1934 

$27,053,141,414 

$680,  767, 817 

$6S0,  767,817 

$27,  733,  909,  231 

$219  46 

1935 

28,  700,  892,  625 

4, 122, 684,  692 

4. 122,  684,  692 

.32,823,577,316 

257. 95 

1936 

33,  778,  543. 494 

4, 718, 033, 242 

4.  718, 033,  242 

38, 496,  576,  735 

300. 63 

1937 

36,  424, 613,  732 

4,  664, 594.  533 

$10, 000 

4,  664, 604,  533 

41,089,218,265 

318.95 

1938 

37,164,740,315 

4, 852.  559, 151 

232,  500 

4,852,791,651 

42,017,531,967 

323. 65 

1939 

40,439,532,411 

5.  450, 012,  899 

821,200 

5,  450,  834, 099 

45,890,366,510 

350.  63 

1940 

42,967,531,038 

5,  497,  556,  555 

31,  514, 100 

5,  529, 070,  655 

48, 496, 601. 693 

367. 08 

1941 

48,961,443,536 

6, 359, 619, 105 

10, 633, 475 

6, 370,  252,  580 

55,331,696,116 

414.85 

1942 

72,422.445,116 

4,  548,  529,  255 

19,7.30,375 

4,  568,  259,  630 

76. 990,  704,  746 

571.02 

1943 

136,  696, 090,  330 

4,091,686,621 

8,  256,  425 

4, 099,  943, 046 

140,  796,  033, 376 

1,029.82 

1944 

201,003,387,221 

1,  515, 638,  626 

107,  430,  675 

1, 623, 069,  .301 

202, 626,  456,  522 

1,464.17 

1945 

258, 682, 187, 410 

409,091,867 

24. 066,  525 

433, 158, 392 

259,115,345,802 

1,851.70 

1946 

269,422,099,173 

466, 671, 984 

9,712,875 

476,  384,  859 

269,  898,  484, 033 

1,908.79 

1947 

258,  286, 383, 109 

83,  212, 285 

6, 307,  900 

89,  520,  185 

258,375,903,294 

1,  792.  67 

1948 

252, 292, 246,  513 

68,768,043 

4, 692,  775 

73,  460, 818 

252,365,707,331 

1,721.21 

1949 

252,  770,  359, 860 

23, 862, 383 

3, 413, 025 

27,  275,  408 

252,  797, 635,  268 

1,694.93 

1950 

257, 357,  352, 351 

17,077,809 

2.  425,  225 

19,  503, 034 

257, 376,  855,  385 

1,696.81 

1951 

255,221,976,815 

27, 364, 009 

1, 863, 100 

29,  227,  169 

255. 251, 203,  984 

1,653.61 

1952 

259, 105, 178,  785 

44,  092,  646 

1, 472,  700 

45,  565, 346 

259,150,744,131 

1,650.35 

1953 

266,071,061,639 

50.  881, 686 

1,191,075 

52. 072, 761 

266,123,134,400 

1,607.06 

1954 

271,  259,  599, 108 

80,415,386 

1, 026,  000 

81.441,386 

271,341,040,495 

1, 670.  64 

1955 

274, 374, 222. 803 

43,  257,  786 

885, 175 

44. 142.  961 

274,418,365,764 

1,660.42 

1956 

272.  750, 813,  649 

73, 100,  900 

787,  575 

73.  888. 475 

272,  824,  702. 124 

1, 622.  26 

1957 

270, 527. 171. 896 

106,  434, 150 

703,  800 

107. 137, 950 

270. 634,  309, 846 

1,  580. 83 

1958 

276, 343, 217, 746 

100,  565,  250 

655, 350 

101.  220,  600 

276,  444,  438,  346 

'  1,  588. 21 

1959 

284,  705, 907, 078 

110, 429, 100 

590, 050 

111,019,150 

284, 816, 926,  228 

'  1, 606.  77 

1960 

286, 330,  760, 848 

139,  305,  000 

536, 775 

139, 841,  775 

286,  470, 602, 623 

'  1,  .585.  60 

1961 

288, 970, 938, 610 

239, 694, 000 

521,450 

240,215,450 

289,211,1.54,060 

5 1, 574. 80 

'  Revised. 

>  Includes  certain  obligations  not  subject  to  statutory  limitation.  For  amounts  subject  to  limitation, 
see  table  1.  Public  debt  includes  debt  incurred  to  finance  expenditures  of  certain  wholly  owned  Government 
corporations  and  other  business-type  activities  in  exchange  for  which  obligations  of  the  corporations  and 
activities  were  issued  to  the  Treasury  (see  table  124). 

2  Consists  of  obligations  issued  by  certain  Government  corporations  and  credit  agencies,  obligations 
which  are  guaranteed  by  the  United  States  as  to  both  principal  and  interest.  They  were  first  authorized 
in  1932,  but  none  were  outstanding  June  30,  1932  and  1933. 

3  Amounts  shown  represent  outstanding  principal  on  which  interest  has  ceased.  The  amount  of  accrued 
interest  as  of  June  30,  1961,  was  $123,451. 

*  Based  on  the  Bureau  of  the  Census  estimated  population.  Through  1958  the  estimated  population  is  for 
the  "conterminous"  United  States  (that  is,  exclusive  of  Alaska,  Hawaii,  and  the  outlying  areas,  such  as 
Puerto  Rico,  Guam,  and  the  Virgin  Islands).  Beginning  with  1959  the  estimates  include  Alaska,  and  with 
1960,  Hawaii. 

» Subject  to  revision. 


510        1961     REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


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514   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  27. — Interest-bearing  securities  outstanding  issued  by  Federal   agencies    but 
not  guaranteed  by  the  United  States  Government,  fiscal  years  1963-61 

[In  miUions  of  dollars] 


Banks 
for  coop- 
eratives 

Federal 

home  loan 

banks ' 

Federal 
interme- 
diate 
credit 
banks 

Federal 

land 
banks » 

Federal  National 
Mortgage  Association 

Tennessee 

Valley 
Authority 

Fiscal  year  or  month 

Manage- 
ment and 
liquida- 
tion pro- 
gram 

Second- 
ary mar- 
ket pro- 
gram 

Total 

1953            

110 
120 
110 
133 
179 

199 
284 
330 
382 

330 
330 
346 
389 
389 
407 
407 
404 
404 
402 
402 
382 

251 
115 
341 
929 
738 

456 

992 

1,259 

1,055 

1,275 

1,272 

1,167 

1,266 

1,266 

1,266 

1,114 

942 

829 

817 

955 

1,055 

781 
725 
793 
834 
924 

1,159 
1,456 
1,600 
1,723 

1,646 
1,670 
1,665 
1,592 
1,516 
1,454 
1,438 
1,478 
1,519 
1,590 
1,661 
1,723 

861 
1,007 
1,061 
1,322 
1,552 

1,646 
1,888 
2,137 
2,357 

2,137 
2,137 
2,137 
2,179 
2,179 
2,210 
2,210 
2,210 
2,210 
2,281 
2,281 
2,357 

2, 003 

1954  .   

1,967 

1955 

570 
570 
570 

797 
797 
797 

797 

2,876 

1956         

100 
1,050 

1,165 
1,290 
2,284 
2,198 

2,317 
2,393 
2,411 
2,436 
2,479 
2,523 
2,546 
2,518 
2,416 
2,276 
2,184 
2,198 

3,889 

1957       

5,013 

1958  -   

5, 423 

1959 

6,708 

1960            

8,407 

1961       

50 

7,765 

1960— July 

8,502 

7,803 

September 

October       

7,726 

7, 862 

50 
50 
50 
50 
50 
50 
50 
50 

7,880 

December 

7,911 

1961— January 

February 

7, 765 
7,602 

March 

7,42tt 

April 

7,417 

May 

7,534 

June 

7,765 

'  The  proprietary  interest  of  the  United  States  in  these  banks  ended  in  July  1951. 

'  The  proprietary  interest  of  the  United  States  in  these  banks  ended  in  June  1947.    Excludes  securities 
which  are  issued  for  use  as  collateral  for  commercial  bank  borrowing  and  not  as  a  part  of  public  offerings. 

Note. — The  securities  shown  in  the  table  are  public  offerings. 


TABLES 


515 


Table  28. — Maturity  distribution  of  marketable  interest-bearing  public  debt  and 
guaranteed  obligations,^  June  30,  1946—61 


In  millions  of  dollars 

.    On  basis  of  daily  Treasury  statements] 

Fiscal  year 

Within 
1  year 

1  to  5 
years 

5  to  10 
years 

10  to  15 
years 

15  to  20 
years 

20  years 
and  over 

Various  2 

Total 

By  call  classes  (due  or  first  becoming  callable) 

1946 

62, 091 
52, 442 
49, 870 
52, 302 
42, 448 
60,  860 
70, 944 
76,017 
63, 291 
51, 152 
64, 910 
76,  697 
73, 050 
81, 678 
79, 182 
84,  855 

35, 057 
42,  522 
46, 124 
39, 175 
51, 802 
31,022 
29, 434 
30, 162 
38, 407 
46,  399 
36, 942 
41,497 
39, 401 
58, 256 
81, 295 
70,  760 

32, 847 
18,932 
10,464 
15,067 
15,926 
16,012 
13,321 
13,018 
27, 113 
42,  756 
40,  363 
26,  673 
45,  705 
28, 075 
14, 173 
18, 411 

16,012 

13. 326 

12. 407 

13,715 

19, 281 

21,226 

20,114 

26,  546 

19, 937 

11,371 

8,387 

6,488 

657 

1,276 

1, 123 

1,123 

21,227 
27. 076 
41,481 
34, 888 
25,  853 
8,797 
6,594 

22, 372 
14,405 

43 
38 
27 
13 
16 
27 
44 
51 
80 
43 
73 
106 
101 
110 
139 
220 

189,  649 

1947 

168, 740 

1948 

160, 373 

1949 

155, 160 

1950         -  -      

155,325 

1951 

137, 944 

1952  .   

140, 451 

1953 

1,592 
1,606 
3,530 
4, 351 
4,349 
5,604 
6,485 
5,588 
8,893 

147, 386 

1954 

150, 435 

1955 

155, 250 

1956 

155,026 

19.57         .  -  .  . 

155,811 

1958 

2,258 
2,256 
2,484 
3,125 

166. 776 

1959         

178. 138 

1960 

183, 985 

1961       . 

187, 388 

By  maturity  classes ' 

1946         

61,974 
51,211 
48,  742 
48, 130 
42, 338 
43, 908 
46. 367 
65, 270 
62, 734 
49, 703 
58,  714 
71, 952 
67,  782 
72, 958 
70, 467 
81, 120 

24. 763 
21,851 
21,630 
32,  562 
51, 292 
46,  526 
47,814 
36, 161 
29, 866 
39, 107 
34, 401 
40,  669 
42,  557 
58, 304 
72,  844 
58, 400 

41, 807 
35, 562 
32,264 
16,  746 
7,792 
8,707 
13,933 
15,651 
27,515 
34, 253 
28, 908 
12, 328 
21,476 
17,052 
20, 246 
26, 435 

8.707 

13, 009 

14.111 

14,111 

10, 289 

8,754 

5,586 

2,117 

8,696 

17, 242 

20, 192 

19,919 

26. 999 

20,971 

11,  746 

8.706 

8,7.54 

5,588 

2,118 

8.710 

17,  746 

21, 226 

20,114 

26,  546 

19, 937 

11,371 

8,387 

6,488 

654 

654 

884 

1,.'VI7 

43,  599 

41,481 

41,481 

34,  888 

25,  853 

8,797 

6.  594 

1,592 

1,606 

3,530 

4,351 

4,349 

7,208 

8,088 

7,658 

10, 960 

43 

38 
27 
13 
16 
27 
44 
51 
80 
43 
73 
106 
101 
110 
139 
220 

189, 649 

1947 

168.  740 

1948  -     

160, 373 

1949            -       

1.55, 160 

1950       

155, 325 

1951             _     

137, 944 

1952.     

140,451 

1953            -       

147. 386 

1954         

150, 435 

1955                .---.- 

1,55, 250 

1956  .   

155, 026 

1957                - 

155,811 

1958.     

166,  776 

1959                   

178, 138 

1960       

183,985 

187, 388 

1  Includes  public  debt  incurred  to  finance  expenditures  of  certain  wholly  owned  Government  corporations 
and  other  business-type  activities  in  exchange  for  which  obligations  of  the  corporations  and  activities  were 
issued  to  the  Treasury;  guaranteed  securities  are  those  held  outside  the  Treasury. 

2  Consists  of  Federal  Housing  Administration  guaranteed  obligations  with  various  maturity  or  call  dates. 
»  All  issues  classified  to  final  maturity  except  partially  tax-exempt  bonds  which  are  classified  to  earliest 

call  date. 


516   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  29. — Summary  of  public  debt  and  guaranteed  obligations  by  security  classes, 

June  SO,  1961 


Class  of  security 

Com- 
puted 
rate  of 
interest ' 

Amount  outstand- 
ing on  basis  of 
Public  Debt 
accounts 

Net  adjustment 
to  basis  of  daily 
Treasury  state- 
ment 2 

Amount  outstand- 
ing on  basis  of  daily 
Treasury  statement 

PUBUC  Debt 

INTEEEST-BEARINr,  DEBT 

Public  issues: 

Marketable  obligations: 
Treasury  bills: 

Regular  weekly 

Tax  anticipation - 

Other 

3  2. 472 
3  2.  538 
3  3. 098 

3.073 
3.704 
2.829 

$28,  715, 482, 000 
1,502,900,000 
6,504,808,000 

13, 337, 993, 000 
56, 263, 435, 000 
80, 828,  716,  750 

$28, 715,  482, 000 

1,  502,  900, 000 

6, 504, 808, 000 

Certificates    of    indebted- 

13, 337, 993, 000 

-$6,289,000 
+1,062,000 

56, 257, 146, 000 

Treasury  bonds    

80, 829,  778,  750 

Subtotal 

3.063 

187, 153, 334,  750 

-5,227,000 

187, 148, 107,  760 

Nonmarketable  obligations: 
U.S.  saving  bonds  — 

3.408 
2.000 

2.000 

2.730 

47,  509,  633, 218 
116,  619, 500 

19, 221, 000 

5,824,019,000 

-f  4, 632, 151 
+200,000 

47, 514, 265, 369 

116, 819,  500 

Treasury    bonds,    R.E.A. 

19, 221, 000 

Treasury    bonds,    in  vest- 

+6,289,000 

5,830,308,000 

Subtotal  

3.330 

53,  469, 492, 718 

+11,121,151 

53,480,613,869 

Total  public  issues 

3.122 

240,  622, 827, 468 

+5, 894, 151 

240, 628,  721, 619 

Special  issues: 

2.637 

2.000 

2.826 
2.125 

2.000 

2.700 

2.000 
3.956 
3.519 
3.000 

3.071 
3.000 
3.000 

2.875 

10, 381, 384, 000 
556,  400, 000 

2,  298, 952, 000 

50,000,000 

86,163,000 

16,  200, 171, 000 

138, 000, 000 

32,180,000 

1,071,433,000 

234, 034, 000 

5,  759, 371, 000 

3,  503,  534, 000 
4, 624, 985, 000 

106,280,000 

10, 381, 384, 000 

Federal      Deposit     Insurance 

556,400,000 

Federal    disability    insurance 

2, 298, 952, 000 

50, 000, 000 

Federal  Housing  Administra- 

86,163,000 

Federal  old-age  and  survivors 

16, 200, 171, 000 

Federal  Savings  and  Loan  In- 

138, 000, 000 

Foreign  service  retirement  fund. 

32, 180, 000 

1,071,433,000 

234,034,000 

National  service  life  insmance 
fund 

5,759,371,000 

3,  503,  534, 000 

Unemployment  trust  fund 

Veterans'    special     term     in- 

4, 624, 985, 000 

106, 280, 000 

2.803 

45,042,887,000 

45,042,887,000 

Total  interest-bearing  debt 

3.072 

285,  665,  714, 468 

+5, 894, 151 

285,  671,  608, 619 

Footnotes  at  end  of  table. 


TABLES 


517 


Table  29. — Summary  of  public  debt  and  guaranteed  obligations  by  security  classes, 
June  SO,  1961 — Continued 


Class  of  security 

Com- 

puted 

rate  of 

interest ' 

Amount  outstand- 
ing on  basis  of 
Public  Debt 
accounts 

Net  adjustment 
to  basis  of  daily 
Treasury  state- 
ment' 

Amount  outstand- 
ng  on  basis  of  daDy 
Treasury  statement 

Public  Debt— Continued 

MATURED  DEBT  ON  'WHICH  INTEREST 

$330, 170, 834 

2,496,000,000 

57,  652, 200 
396, 068, 540 

+$19,184,375 

.$349, 355, 209 

DEBT  BEARINO  NO  INTEREST 

2, 496, 000, 000 

International  Development  Associ- 

57, 652, 200 

Other    -— 

+254, 042 

396,  322,  582 

Total  gross  public  debt 

288, 945,  606, 042 

+25,332,568 

288, 970, 938,  610 

Guaranteed  Obligations  not 
Owned  by  the  Treasury 

Interest-bearing  debt: 

Federal  Housing  Administra- 

3.049 
4.200 

219,894,000 
19,800,000 

521, 450 

*  219, 894, 000 

D.C.  Armory  Board  bonds 

Matured  debt  on  which  interest 

19, 800, 000 

521, 450 

240, 215, 450 

240, 215, 450 

Total  gross  public  debt  and 
guaranteed  obligations 

289,185,821,492 

+25,332,568 

289,211,154,060 

Deduct  debt  not  subject  to  statu- 

348,643,280 

-648,250 

349, 291, 530 

Total  debt  subject  to  limita- 

288,837,178,212 

+24,684,318 

288, 861, 862,  530 

•  On  daily  Treasury  statement  basis. 
» Items  in  transit  on  June  30,  1961. 

3  Included  in  debt  outstanding  at  face  amount,  but  the  annual  interest  rate  is  computed  on  the  discount 
value. 

♦  Components  shown  in  table  31. 


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TABLES 


537 


Table  31. — Description  of  guarantetd  obligations  held  outside  the  Treasury,  June  SO, 

1961 

[On  basis  of  daily  Treasury  statements,  see  "Bases  of  Tables"] 


Security 


Rate  of 
interest 


Amount 


Unmatttred  Obligations 

District  of  Columbia  Armory  Board  stadium  bonds  of  1970-79  issued  under  the 
act  of  September  7,  1957,  as  amended  (2  D.C.  Code  1722,  1727)i » 


Federal  Housing  Administration  debentures  issued  under  the  act  of  June  27, 
1934,  as  amended  (12  U.S.C.  1701-1750g):  3« 

Mutual  mortgage  insurance  fund: 

Series  A  ^ 

Series  AA 

Series  A  A -. 

Series  A  A _ 

Series  A  A _.. 

Series  A  A 

Series  A  A 

Series  A  A 

Series  A  A 

Series  A  A 

Series  AA 

Series  A  A 

Armed  services  housing  mortgage  insurance  fund: 

Series  FF 

Series  FF.... 

Series  FF. 

Series  FF 

Series  FF 

Series  FF 

Series  FF 

Housing  insurance  fund: 

Series  BB 

Series  BB 

Series  BB 

Series  BB 

Series  BB 

Series  BB 

Series  BB 

Series  BB... 

Series  BB. 

Series  BB 

National  defense  housing  insurance  fund: 

Series  GG 

Scries  OG 

Series  QG 

Series  GG 

Series  GG 

Series  GG. 

Series  P 

Section  221  housing  insurance  fund: 

Series  DD 

Series  DD.. 

Series  DD 

Series  DD 

Series  DD 

Series  DD.. 

Servicemen's  mortgage  insurance  fund: 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Series  EE 

Title  I  housing  insuiance  fund: 

Series  L 

Series  R 

Series  T. 

War  housing  insurance  fund: 

Series  H 


Percent 
4.20 


3 

2^ 

2H 
2~A 
3 

3M 

3H 
3% 

2}i 
2% 
3!^ 
3^^ 

3?4 
4?4 

21-4 

2% 

2^A 

3 

3Ji 

3 

Z% 

ZVt 

Wi 

iH 

2H 
2H 
2% 
2% 
3 '4 
3?s 
2J^ 

3'^ 
3M 
3H 
ZM 

4H 

2% 
2% 
3 
3^^ 

3J: 

3?^ 

m 
m 

2iA 
2% 
3 

2H 


$19,800,000.00 


170, 600. 00 

853, 850. 00 

509, 850. 00 

221, 300. 00 

913, 000. 00 

774, 200. 00 

1, 834,  550. 00 

501,250.00 

1,  859,  650. 00 

5, 256, 400. 00 

5,648,400.00 

6, 845,  700. 00 

5, 464, 400. 00 

10, 140, 050. 00 

12,121,000.00 

22, 000. 00 

36. 000. 00 

26, 068,  500. 00 

8,  568, 450. 00 

2, 053, 000. 00 
2, 814, 350. 00 
5, 000. 00 
1,302,000.00 
1,754,400.00 
1,637,800.00 
3,451,450.00 
7, 040, 850. 00 
25, 850. 00 
3,321,300.00 

36, 868, 200. 00 

478, 750. 00 

33, 916, 850. 00 

3, 365, 850. 00 

260,  950. 00 

9, 050. 00 

493,750.00 

713, 100. 00 
9, 100. 00 

258, 150. 00 
1, 627, 450. 00 

362,  500.  00 
1,809,400.00 

22, 600. 00 
60. 000. 00 
109, 550. 00 
182, 500. 00 
1.51,900.00 
1.55,300.00 
494,  700. 00 
271,050.00 
225,600.00 

13, 000. 00 
43, 200. 00 
129, 650. 00 

26,  646,  700. 00 


Subtotal 

Total  unmatured  obligations. 
Footnotes  at  end  of  table. 


«  219, 894, 000. 00 


239, 694, 000. 00 


538 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  31. — Description  of  guaranteed  obligations  held  outside  the  Treasury,  June  SO, 

1961— Continued 


Securitj' 


Rate  of 
interest 


Amount 


Matxtred  Orlioations  ' 


Commodity  Credit  Corporation,  interest 

District  of  Columbia  Armory  Board,  interest- 
Federal  Farm  Mortgage  Corporation: 

Principal 

Interest.- 

Federal  Housing  Administration: 

Principal 

Interest 

Home  Owners'  Loan  Corporation: 

Principal 

Interest 

Reconstruction  Finance  Corporation,  interest. 


$11.25 
16, 905. 00 

173,800.00 
38, 825. 20 

24,  700. 00 
432. 46 

322, 950. 00 

67, 257.  76 

19.25 


Total  matured  obligations  (principal  and  interest). 
Total  based  on  guarantees 


644,  900. 92 


240, 338. 900. 92 


1  Issued  on  June  1,  1960,  at  a  price  to  yield  4.1879  percent,  but  sale  was  not  consummated  until  Aug.  2, 
1960.  Interest  is  payable  semiannually  on  June  1  and  Dec.  1.  These  bonds  are  redeemable  on  and  after 
June  1,  1970,  and  mature  on  Dec.  1,  1979. 

2  The  securities  and  the  income  derived  therefrom,  and  gain  from  the  sale  or  other  disposition  thereof 
or  transfer  as  by  inheritance  or  gift,  are  subject  to  taxation  by  the  United  States,  but  are  exempt  both  as 
to  principal  and  interest  from  all  taxation,  except  estate  and  inheritance  taxes,  imposed  by  the  District 
of  Columbia. 

3  Issued  and  payable  on  various  dates.  Interest  is  payable  semiannually  on  Jan.  1  and  July  1.  All  un- 
matured debentures  are  redeemable  on  any  interest  day  or  days,  on  3  months'  notice,  except  the  Series  A 
debentures  which  are  not  redeemable  until  maturity. 

*  Under  the  Public  Debt  Act  of  1941  (31  U.S.C.  742a),  income  or  gain  derived  from  these  securities  except 
mutual  mortgage  insurance  fund  debentures.  Series  A,  is  subject  to  all  Federal  taxes  now  or  hereafter  im- 
posed. The  securities  are  subject  to  surtaxes,  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,  municipality,  or  local  taxing  authority.  Debentures  issued  on  contracts  entered  into  before 
Mar.  1,  1941,  are  exempt  from  all  taxation  except  surtaxes,  estate,  inheritance,  and  gift  taxes. 

'  Series  A  debentures  are  subject  only  to  such  Federal,  State,  and  local  taxes  as  the  mortgages  in  exchange 
for  which  they  are  issued  would  be  subject  to  in  the  hands  of  the  holders  of  the  debentures. 

"  Includes  Series  A  debentures  amounting  to  $161,800,  maturing  on  July  1,  1961;  and  debentures  called 
for  redemption  on  July  1,  1961,  at  par  plus  accrued  interest,  as  follows:  Series  AA,  $6,141,100;  Series  BB, 
$350;  Series  EE,  $439,450;  Series  L,  $4,500;  Series  R,  $21,650;  Series  T,  $34,800;  and  Series  H,  $897,350. 

'  Funds  are  on  deposit  with  the  Treasurer  of  the  United  States  for  payment  of  principal  of  $521,450  and 
interest  of  $123,450.92. 

Note.— For  obligations  held  by  the  Treasury,  see  table  124. 


TABLES 


539 


Table  32. — Postal  savings  systems'  deposits  and  Federal  Reserve  notes  outstanding , 

June  SO,  1946-61 

[Face  amount  in  thousands  of  dollars.    On  basis  of  reports  received  by  the  Treasury] 


Deposits 

in  postal  savings  systems  ' 

June  30 

U.S.  Postal 
Savings 
System  2 

Canal  Zone 

Postal  Savings 

System  a 

Total 

Federal 
Reserve  notes  * 

1946         

3.119,656 
3, 392, 773 
3,379,130 
3, 277, 402 
3,097,316 
2, 788, 199 
2, 617,  564 
2, 457, 548 
2,251.419 
2, 007, 996 
1,  765, 470 
1,462,268 
1,212,672 
1,041,792 
835, 800 
«  699,  528 

9,612 
9,602 
9,129 
8,943 
8,643 
7,044 
7,005 
6,848 
6,506 
6,290 
6,313 
6,139 
5,713 
5,492 
5,067 
6  4, 695 

3,129,268 
3, 402, 375 
3, 388, 259 
3, 286, 346 
3, 105,  959 
2,  795, 244 
2, 624, 569 
2, 464, 396 
2, 257, 926 
2,014,286 
1,771,783 
1, 468, 408 
1,218,385 
1,047,284 
840, 867 
704,223 

23, 434, 613 

1947 

23, 444, 193 

1948 

23, 136, 167 

1949                         

22,  783, 823 

1950 

22, 398, 284 

1951                 

22, 975, 292 

1952.. 

24, 135, 367 

1953      

25, 040, 465 

1954 

24,  726,  731 

1955 

25,030,031 

1956 

25,  523,  779 

1957 

25, 836,  574 

1958                                   

25, 862, 932 

1959 -. 

26, 479, 923 

I960                                       

26,  569, 479 

1961 

'26,735,869 

1  The  faith  of  the  United  States  is  solemnly  pledged  to  the  payment  of  deposits  (plus  accrued  interest  a 
the  rate  of  2  percent)  made  in  postal  savings  depositary  offices.    Interest  is  payable  quarterly  from  the 
first  day  of  the  month  next  following  date  of  deposit,  and  on  deposits  made  after  Mar.  1,  1941  (under  the 
Public  Debt  Act  of  1941  (31  U.S.C.  742a)),  is  subject  to  all  Federal  taxes. 

2  Established  by  the  act  of  June  25,  1910,  as  amended  (39  U.S.C.  751-771). 

3  Established  by  the  act  of  June  13,  1910  (2  Canal  Zone  Code  273-280). 

*  Authority  for  the  issuance  of  Federal  Reserve  notes  was  given  under  the  act  of  Dee.  23, 1913,  as  amended 
(12  U.S.C.  411-416).  The  notes  are  obligations  of  the  United  States  and  are  receivable  by  all  national  and 
member  banks  and  Federal  Reserve  Banks  and  for  all  taxes,  customs,  and  other  public  dues.  They  are 
redeemable  in  lawful  money  on  demand  at  the  Treasury  Department,  Washington,  D.C. ,  or  at  any  Federal 
Reserve  Bank. 

«  Funds  due  depositors  on  June  30,  1961,  including  interest  of  $71,555,244  totaling  $771,082,943,  are  offset 
by  cash  in  designated  depositary  banks  amounting  to  $17,846,397,  which  is  secured  by  the  pledge  of  collateral 
as  provided  in  the  regulations  of  the  Postal  Savings  System,  having  a  face  value  of  $17,848,500;  Government 
securities  with  a  face  value  of  $720,703,000;  and  cash  in  possession  of  the  System  and  other  net  assets  of 
$32  533  546 

'Funds  due  depositors  on  June  30,  1961,  including  interest  of  $253,423  totaling  $4,948,448,  are  offset  by 
Government  securities  having  a  fac«  value  of  $5,050,090  and  other  assets. 

'  In  actual  circulation,  exclusive  of  $1,043,034,904  redemption  fund  deposited  in  the  Treasury  and 
$1,181,402,915  of  their  own  Federal  Reserve  notes  held  by  the  issuing  banks.  The  collateral  security  for 
Federal  Reserve  notes  issued  consists  of  $8,975,000,000  in  gold  certificates  and  in  credits  with  the  Treasurer 
of  the  United  States  payable  in  gold  certificates,  $21,235,000,000  face  amount  of  U.S.  Government  securities, 
and  $7,495,000  face  amount  of  commercial  paper.  Notes  issued  by  a  Federal  Reserve  Bank  are  a  first  lien 
against  the  assets  of  such  Bank. 


614359—62- 


-35 


TABLES 


541 


Table  33. — Statutory  limitation  on  the  public  debt  and  gxiaranteed  obligations,  June 

30,  1961 

[In  millions  of  dollars] 

Part  I.— STATUS  UNDER  LIMITATION.  JUNE  30,  1961 


Maximum  amount  of  securities  which  may  be  outstanding  at  any  one  time  under  limitations 
imposed  by  section  21  of  the  Second  Liberty  Bond  Act,  as  amended  by  the  acts  of  June  30, 
1959,  and  June  30, 1960  (31  U.S.C.  757b).    (The  following  table  lists  the  amendments.) 

Amoimt  of  securities  outstanding  subject  to  such  statutory  debt  limitation: 

U.S.  Government  securities  issued  under  the  Second  Liberty  Bond  Act,  as  amended 

Guaranteed  obligations  held  outside  the  Treasury 


Total  amount  of  securities  outstanding  subject  to  statutory  debt  limitation. 
Balance  issuable  under  limitation... 


1 293, 000 


288,  622 
240 


288, 862 


4,138 


Part   II.— APPLICATION    OP    LIMITATION    TO    PUBLIC    DEBT    AND    GUARANTEED 
OBLIGATIONS  OUTSTANDING  JUNE  30,  1961 


Class  of  security 

Subject  to 
statutory 
debt  limi- 
tation 

Not  subject 
to  statutory 
debt  limi- 
tation 

Total  out- 
standing 

Public  debt: 

Interest-bearing  securities: 
Marketable: 

Treasury  bills      

36,  723 
13,338 
56, 257 
80, 830 

36,  723 
13, 338 
56, 257 
80  830 

Certificates  of  indebtedness 

Treasury  notes 

Treasury  bonds    

Total  marketable 

187, 148 

187, 148 

Nonmarketable: 

U.S.  savings  bonds  (current  redemption  value) 

47,  514 

117 

19 

5,830 

47,  514 
117 

Depositary  bonds 

R.E.A.  bonds       

19 

Treasury  bonds,  mvestment  series 

5,830 

Total  nonmarketable 

53,481 

53,481 

Special  issues  to  Government  agencies  and  trust  funds- 

45,043 

45, 043 

T  otal  interest-bearing  securities 

285, 672 

285,672 

Matured  debt  on  which  interest  has  ceased 

344 

6 

349 

Debt  bearing  no  interest: 

52 

1 

2,496 
58 

52 

Excess  profits  tax  refund  bonds 

1 

Special  notes  of  the  United  States: 

International  Monetary  Fund  Series 

2,496 

International  Development  Association  Series 

58 

191 

147 
6 

191 

Deposits  for  retirement  of  national  bank  and  Federal 
Reserve  Bank  notes      

147 

Other  debt  bearing  no  interest 

6 

Total  debt  bearing  no  interest 

2,606 

344 

2,950 

Total  public  debt  2      

288, 622 

349 

288, 971 

Guaranteed  obligations  held  outside  the  Treasury: 

240 
1 

240 

Matured . . 

1 

Total  guaranteed  obligations 

240 

240 

Total  public  debt  and  guaranteed  obligations 

288, 862 

349 

289, 211 

'  For  debt  limit  effective  July  1, 1961,  see  following  table. 

'  Includes  public  debt  incurred  to  finance  expenditures  of  certain  whoUy  owned  Government  corporations 
and  other  business-type  activities  in  exchange  for  which  obligations  of  the  corporations  and  activities  were 
issued  to  the  Treasury.    See  table  124. 


542         1961     REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
Table  34. — Debt  limitation  under  the  Second  Liberty  Bond  Act,  as  amended,  1917-61 


Enactment  date  and  statute 


Provisions  of  legislation 


Amount  and  kind 
of  limitation 


Sept.  24,  1917: 

(40  Stat.  288) 

(40  Stat.  290) 

April  4,  1918: 

(40  Stat.  502) 

(40  Stat.  504) 

July  9,  1918  (40  Stat.  844).. 

Mar.  3,  1919: 

(40  Stat.  1311) 

(40  Stat.  1309). 

Nov.  23.  1921  (42  Stat.  321) 

.Inne  17,  1929  (46  Stat.  19) . . 


Mar.  3,  1931  (46  Stat.  1506). 

Jan.  30,  1934  (48  Stat.  343).. 

Feb.  4,  1935: 

(49  Stat.  20) 

(49  Stat.  21) 

Do... 


May  26,  1938  (52  Stat.  447)... 

June  20,  1939  (53  Stat.  1071).. 
June  25,  1940  (54  Stat.  526).... 


Feb.  19,  1941  (55  Stat.  7). 


Mar.  28,  1942  (56  Stat.  189) 
Apr.  11,  1943  (57  Stat.  63).. 
June  9,  1944  (58  Stat.  272). 
Apr.  3,  1945  (59  Stat.  47).. 


Footnotes  at  end  of  table. 


Sec.  1  authorized  bonds  in  the  amount  of 

Sec.  5  authorized  certiticates  of  indebtedness  out- 
standing at  any  one  time  (revolving  authority) 

Sec.  1  amended  to  increase  authorized  amount  of 
bonds  to 

Sec.  5  amended  to  increase  authorized  amount  of 
certificates  outstanding  to 

Sec.  1  amended  to  increase  authorized  amount  of 
bonds  to 

Sec.  5  amended  to  Increase  authorized  amount  of 
certificates  outstanding  to 

Sec.  18  (new)  authorized  notes  in  the  amount  of 

Sec.  18  amended  to  establish  revolving  authority  for 
the  issuanceof  notes  and  limited  amount  outstand- 
ing at  any  one  time  to 

Sec.  5  amended  to  authorize  issuance  of  Treasury 
bills,  as  well  as  certificates  of  indebtedness,  and 
limited  amount  of  both  outstanding  at  any  one 
time  to.. 

Sec.  1  amended  to  increase  authorized  amount  of 
bonds  to 

Sec.  18  amended  to  increase  authorized  amount  of 
notes  outstanding  to , 

Sec.  1  amended  to  establish  revolving  authority  for 
the  issuance  of  bonds  and  limited  the  amount  out- 
standing at  any  one  time  to 

Sec.  21  (new)  consolidated  limitation  on  issuance  of 
bills  and  certificates  (sec.  5)  and  limitation  on 
issuance  of  notes  (sec.  18).  Aggregate  amount 
outstanding  of  securities  under  both  sections 

Sec.  22  (new)  authorized  issuance  of  U.S.  savings 
bonds,  the  amount  issued  to  be  Included  in  the 
limitation  in  sec.  1. 

Sees.  1  and  21  amended  to  consolidate  in  sec.  21  all 
limitations  on  bills,  certificates,  notes,  and  bonds; 
limited  bonds  outstanding  to  $30  billion,  and  ag- 
gregate total  to 

Sec.  21  amended  to  remove  limitation  on  bonds  with- 
out changing  limitation  on  aggregate  total  of 

Sec.  21  amended  to  insert  "(a)"  after  21,  and  to  add 
atend  of  sec.  21(a):  "(b)  In  addition  to  the  amount 
authorized  by  the  preceding  paragraph  of  this  sec- 
tion, any  obligations  authorized  by  sections  5  and 
18  of  this  Act,  as  amended,  not  to  exceed  in  the 
aggregate  $4,000,000,000  outstanding  at  any  one 
time,  less  any  retirements  made  from  the  special 
fund  made  available  under  section  301  of  the  Reve- 
nue Act  of  1940,  may  be  issued  under  said  sections 
to  provide  the  Treasury  with  funds  to  meet  any 
expenditures  made,  after  June  30,  1940,  for  the 
national  defense,  or  to  reimburse  the  general  fund 
of  the  Treasury  therefor.  Any  such  obligations  so 
issued  shall  be  designated  'National  Defense 
Series'."... .— 

Sec.  21  amended  to  eliminate  separate  authority  for 
$4  billion  of  National  Defense  Series  obligations 
and  provided  that  the  face  amount  of  obligations 
issued  under  this  act  outstanding  at  any  one  time 
shall  not  exceed  in  the  aggregate.. 

Sec.  21  amended  to  incresise  limitation  on  aggregate 
outstanding  at  any  one  time  to 

Sec.  21  amended  to  increase  limitation  on  aggregate 
outstanding  at  any  one  time  to 

Sec.  21  amended  to  increase  limitation  on  aggregate 
outstanding  at  any  one  time  to 

Sec.  21  amended  to  provide  that  the  face  amount  of 
obligations  Issued  under  this  act  and  the  face 
amount  of  obligations  guaranteed  as  to  principal 
and  interest  (except  such  guaranteed  obligations 
as  may  be  held  by  the  Secretary  of  the  Treasury) 
outstanding  at  any  one  time  shall  not  exceed  in  the 
aggregate 


'  $7, 538, 945, 460 
24,000,000,000 

112,000,000,000 
2  8, 000, 000, 000 
>  20, 000, 000, 000 


2  10, 000, 000, 000 
I  7,000,000,000 


2  7,  .500, 000, 000 

2  10, 000, 000, 000 
'  28, 000, 000. 000 
2  10, 000,  000, 000 

2  25,000,000,000 

2  20, 000, 000, 000 


»  45, 000, 000, 000 
s  45, 000, 000, 000 


'  4, 000, 000, 000 

2  65,000,000,000 
2  125, 000, 000, 000 
2  210,000,000,000 
2  260,000,000,000 


2300,000,000,000 


TABLES 


543 


Table  34. 


-Debt  liinitation  under  the  Second  Liberty  Bond  Act,  as  amended, 
1917-61— Continued 


Enactinent  date  and  statute 


Provisions  of  legislation 


Amount  and  kind 
of  limitation 


June  26,  1946  (60  Stat.  316). 


Aug.  28,  1954  (68  Stat.  895) 

June  30,  195')  (69  Stat.  241) 
July  9,  1956  (70  Stat.  519). 


Feb.  26,  1958  (72  Stat.  27).- 
Sept.  2,  1958  (72  Stat.  1758). 


June  30,  1959  (73  Stat.  156-7)... 


June  30,  1960  (74  Stat.  290). 


June  30,  1%1  (75  Stat.  148). 


See.  21  amended  to  add:  "The  current  redemption 
value  of  any  obligation  issued  on  a  discoiuit  basis 
vi'hich  is  redeemable  prior  to  maturity  at  the  op- 
tion of  the  holder  thereof  shall  be  considered,  for 
the  purposes  of  this  section,  to  be  the  face  amount 
of  such  obligation."  Amendment  decreased  the 
limitation  to 

Sec.  21  amended,  eflective  Aug.  28,  1954,  and  ending 
June  30,  1955,  to  increase  the  limitation  tempo- 
rarily by  $6  billion  to 

Sec.  21  act  of  Aug.  28,  1954,  amended  to  extend  until 
June  30,  1956,  the  increase  in  limitation  to 

Sec.  21  act  of  Aug.  28,  1954,  amended  to  increase  the 
limitation  temporarily,  beginning  July  1, 1956,  and 
ending  June  30,  1957,  by  $3  billion  to" 

Temporary  increase  terminated  June  30,  1957;  and 
the  limitation  on  the  aggregate  outstanding  at  any 
one  time  reverted  to  that  under  the  act  of  June  26, 
1946  (60  Stat.  316) 

Sec.  21  amended  to  increase  the  limitation  tempo- 
rarily, beginning  Feb.  26,  1958,  and  ending  June 
30,  1959,  by  $5  billion  to 

Sec.  21  amended,  elTective  Sept.  2,  1958,  to  increase 
the  limitation  on  the  aggregate  amount  outstand- 
ing at  any  one  time  to 

The  increase  in  the  limitation  on  the  aggregate  out- 
standing, together  with  the  temporary  increase  of 
$5  billion  beginning  Feb.  26, 1958,  and  ending  June 
30,  1959,  provided  an  operating  limitation  of 

Sec.  21  amended,  eflective  June  30,  1959,  to  increase 
the  limitation  on  the  aggregate  amount  outstand- 
ing to 

With  the  temporary  increase  of  $5  billion  (act  of  Feb. 
26,  1958  (72  Stat.  27),  which  ended  June  30,  1959, 
the  operating  limitation  on  June  30,  1959,  was 

Sec.  21  amended  also  to  incresise  the  limitation  tem- 
porarily, beginning  July  1,  1959,  and  ending  June 
30,  1960,  by  $10  billion,  providing  an  operating 
limitation  of 

Sec.  21  amended  to  increase  the  limitation  tempo- 
rarily, beginning  July  1,  1960,  and  ending  June  30, 

1961,  by  $8  bUlion,  providing  an  operating  limita- 
tion of 

See.  21  amended  to  increase  the  limitation  tempo- 
rarily, beginning  July  1,  1961,  and  ending  June  30, 

1962,  by  $13  billion,  providing  an  operating  limita- 
tion of 


2  $275, 000, 000, 000 

2  281,000,000,000 
2  281, 000, 000, 000 

2  278, 000, 000, 000 

2  275, 000, 000, 000 
2  280, 000, 000, 000 
2  283,000,000,000 

2  288, 000, 000, 000 
2  285,000,000,000 
2  290, 000, 000, 000 

2  295, 000, 000,  OOO 

2  293, 000, 000, 000 

2  298, 000, 000, 000 


1  Limitation  on  issue. 

2  Limitation  on  outstanding. 

'■'  Limitation  on  issues  less  retirements. 


544 


01     e  .2 


CO    fn 


1961    REPORT    OF    THE 

SECRETARY 

OF    THE    TREASURY 

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574   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' 

[On  basis  of  daily  Treasury  statements,  supplemented  by  special  statements  by  the  Bureau  of  the  Public 

Debt  on  pubUc  debt  transactions] 


Date 

Security 

Rate  of 
interest  2 

Amount  issued ' 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 

1960 
July     7 

Treasury  bills: 

Regular  weekly: 

Issued  Jan.  7,  1960: 

Redeemed  in  exchange  for  series 
dated  July  7,  1960,  due  Oct.  6, 
1960 

Percent 
6  3.  362 

$118,366,000.00 
52,368,000  00 

Redeemed  in  exchange  for  series 
dated  July  7,  1960,  due  Jan.  6, 
1961 

Redeemable  for  cash 

1, 329,  611,  000. 00 

7 

Maturing  Oct.  6,  1960: 

Issued    in    exchange    for    series 
dated  Jan.  7,  1960 

2.307 

$118,366,000.00 
882, 063,  000.  00 

52, 368, 000.  00 
447, 682,  000. 00 

3,511,749,000.00 

Issued  for  cash .  . . 

7 

Maturing  Jan.  5,  1961: 

Issued    in    exchange    for    series 
dated  Jan.  7,  1960 

2.805 

Issued  for  cash 

13 

Tax  anticipation: 

Maturing  Mar.  22,  1961: 

Issued  for  cash 

2.823 
« 3. 987 

14 

Regular  weekly: 

Issued  Jan.  14,  1960: 

Redeemed  in  exchange  for  series 
dated  July  14, 1960,  due  Oct.  13, 
1960 

15,203,000.00 
52, 103,  000. 00 

Redeemed  in  exchange  for  series 
dated  July  14,  1960,  due  Jan. 
12,  1961.. 

Redeemable  for  cash 

1,  432,  850,  000. 00 

14 

Maturing  Oct.  13,  1960: 

Issued    in    exchange    for    series 
dated  Jan.  14,  I960..- 

2.567 

15,  203, 000. 00 
986,  093, 000. 00 

52, 103,  000.  00 
448, 086,  000. 00 

Issued  for  cash.  

14 

Maturing  Jan.  12,  1961: 

Issued    in    exchange    for    series 
dated  Jan.  14,  1960       .... 

3.175 

Issued  for  cash 

15 

Other: 

Issued  July  15,  1959: 

Redeemed  in  exchange  for  series 
dated  July  15,  1960 

4.728 

120,  532, 000. 00 

Redeemable  for  cash 

1,880,344,000.00 

15 

Maturing  July  15,  1961: 

Issued    in    exchange    for    series 
dated  July  15,  1959 

3.265 

120,  532, 000.  00 
1, 379,  977,  000.  00 

Issued  for  cash 

21 

Regular  weekly: 

Issued  Jan.  21,  1960: 

Redeemed  in  exchange  for  series 
dated  July  21,  1960,  due  Oct. 
20,  1960 

»  3.  695 

51,464,000.00 

21 

Redeemed  in  exchange  for  series 
dated  July  21,  1960,  due  Jan. 
19,  1961 

31,  850. 000. 00 

Redeemable  for  cash 

1,  317, 144, 000.  00 

21 

Maturing  Oct.  20,  1960: 

Issued    in    exchange    for    series 
dated  .Tan.  21,  1960... 

2.307 

51,  464, 000. 00 
948,711,000.00 

31,  850, 000. 00 
368,  203, 000. 00 

Issued  for  cash      .  .  . 

Maturing  Jan.  19,  1961: 

Issued    in    exchange    for    series 
dated  Jan.  21,  I960..   

2.625 

Issued  for  cash                    _  _ 

28 

Issued  Jan.  28,  1960: 

Redeemed  in  exchange  for  scries 
dated  July  28,  1960,  due  Oct. 
27,  1960 

5  3. 685 

121, 810, 000. 00 

Redeemed  in  exchange  for  series 
dated  July  28,  1960,  due  Jan. 
26,  1961 

35,  743,  000. 00 

Redeemable  for  cash 

1,243,623,000.00 

Footnotes  at  end  of  table. 


TABLES 


575 


Table   37. — Issues,    maturities,    arid   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 


\ 


Security 


Rate  of 
interest  ■ 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  matm'ity  * 


1960 
July   28 


Treasury  bills— Continued 

Regular  weekly — Continued 
Maturing  Oct.  27,  1960: 

Issued    in    exchange    for    series 
dated  Jan.  28,  1960 

Issued  for  cashi 

Maturing  Jan.  26,  1961: 

Issued    in    exchange    for    series 
dated  Jan.  28,  1960 

Issued  for  cash 

U.S.  savings  bonds: « 

Series  E-1941 

Series  E-1942 

Series  E-1943 

Series  E-1944 

Series  E-1945 

Series  E-1946 

Series  E-1947.. 

Series  E-1948 

Series  E-1949 

Series  E-1950 -. 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 

Series  E-1954 

Series  E-1955 

Series  E-1956 

Series  E-1957  (January) 

Series  E-1957  (February  to  December)... 

Series  E-1958 

Series  E-1959  (January  to  May).. 

Series  E-1959  (June  to  December) 

Series  E-1960 

Unclassified  sales  and  redemptions 

Series  F-1948 

Series  F-1949 

Series  F-1950 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  G-1948 

Series  G-1949 

Series  G-1950 

Series  G-1951 

Series  G-1952 

Unclassified  sales  and  redemptions 

Series  H-1952-. 

Series  H-1953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-1957  (January) 

Series  H-1957  (February  to  December).. 

Series  H-1958 

Series  H-1959  (January  to  May) 

Series  H-1959  (June  to  December).. 

Series  H-1960 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J-195a 

Series  J-1954 

Series  J-1955 

Series  J-1956- 

Series  J-1967 

Unclassified  sales  and  redemptions 

Series  K-1952.... 

Series  K-1953 

Series  K-1954 

Series  K-1955. 

Series  K-1956 

Series  K-1957 

Unclassified  sales  and  redemptions. 


Percent 


2.701 


7  2.  962 

'  3. 007 

■  3.  046 

^  3. 069 

'  3. 097 

'  3. 118 

7  3. 146 

7  3. 168 

1  3.  266 

'  3.  347 

'  3. 378 

3.400 

'  3.  451 

^  3.  468 

?  3. 497 

^  3.  522 

7  3.  546 

3.560 

^  3.  653 

1  3. 691 

3.730 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 
2.50 


■  3. 123 

'  3. 161 

7  3.211 

7  3. 258 

7  3.317 

3.360 

'  3. 626 

^  3. 679 

3.720 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


$121,  810, 000. 00 
878, 361, 000. 00 


35, 743, 000. 00 
364, 457, 000. 00 


1, 018, 

6,  742, 
5,  701, 

10,  892, 
5,  652, 
4, 062, 
5, 082, 
5,  470, 
6, 012, 

7,  852, 
7,  422, 

4,  027, 

2,  583, 

5,  801, 

6,  547, 

7,  237, 
6,  451, 
2, 370, 
3, 390, 
7, 693, 

3,  831, 
3, 050, 

253, 461, 
39, 815, 
1, 356, 
486, 
421, 
254, 
133, 


059. 07 
833. 86 

240. 36 
344.  51 
351. 66 
565. 66 
165. 89 
176.  79 
175. 34 
588. 30 
748.  85 
516.  30 
619.  55 
728.  39 
593. 99 
045. 02 
111.39 
494.31 
008.  21 
671.  92 
341.37 
761. 33 
303.  74 
325.  76 
381.  65 
916. 66 

105. 37 
000.  78 
498. 63 


s  436,  500. 00 

1, 000. 00 

70,  550,  500. 00 

9, 902, 000. 00 

89, 119. 80 

245,  595. 64 

434,  294. 60 

430, 146.  57 

353,971.25 

89, 842.  64 


$3,228, 
12,  720, 
20,  730, 
25,  551, 

22,  855, 
11,763, 
12, 625, 

15,  235, 
18, 197, 
24, 846, 

7, 907, 
2,  513, 
5, 950, 
10, 422, 
12, 139, 
13, 497, 
14, 746, 
1,  263, 

16,  682, 

23,  782, 
14,  213, 
35,  226, 
63,  234, 
16,  740, 

6,  634, 

667, 

1, 038, 

264, 

110, 

58, 147, 

32, 772, 

5,  214, 

6, 030, 

1,  920, 
422, 

124,  018, 

691, 

1,443, 

2,  591, 

3,  553, 
3, 120, 

180, 

2, 160, 

3,  853, 

1,451, 

1, 545, 

32, 

1, 789, 

789, 

655, 

1, 401, 

1, 607, 

813, 

127, 

1, 097, 

1,  629, 

1, 353, 

5,  991, 

2, 532, 

1, 496, 

160, 

4, 093, 


121.  21 
987. 12 

543. 11 
587.  94 
447.  63 
660. 01 
109.  23 
536. 84 
584.  45 
528.  25 
411.64 
241.  52 
094. 83 
337. 66 
883. 07 
572. 75 
196.  42 
746. 30 
306. 35 
311.70 

955. 12 
559.  60 
318.75 
380. 00 
438. 00 
043. 83 
378. 03 
039.  48 
408. 05 
343. 48 
300. 00 
800. 00 
200.  00 
300. 00 
000. 00 
600.  00 
600. 00 
000. 00 
000. 00 
500. 00 
500. 00 
500. 00 
000. 00 
000. 00 
500. 00 
500.00 
000. 00 
000. 00 
983.  55 
882. 39 
343.90 
745.  58 
150. 70 
416.  71 
226.  63 
500.  00 
000. 00 
500. 00 
000. 00 
000. 00 
000. 00 
000. 00 


Footnotes  at  end  of  table. 


576   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturilies,    and   redemptions   of  interest-hearing   'public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 


Security 


Rate  of 
interest  ^ 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


1960 
July  31 


31 


Treasury  notes,  Series  D-1964: 

Issued  in  exchange  for  2}^%  Treasury 

bonds  of  1961 

Treasury  bonds  of  1968: 

Issued  in  exchange  for  2J^%  Treasury 

bonds  of  1961 , 

Treasury  bonds  of  1961: 

Redeemed  in  exchange  for  3?4%  Treasiuy 

notes,  Series  D-1964 

Redeemed  in  exchange  for  3J^%  Treasury 

bonds  of  1968 

Treasury  notes,  Series  B-1962: 

Redeemable   for    cash    (Feb.    15,    1960, 

option) 

Treasury  bonds,  R.E.A.  Series 

Depositary  bonds,  First  Series 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  exchange  for  Treasury 

notes.  Series  EA-1965 

Treasury  notes.  Series  EA-1965 

Miscellaneous 


Total  July. 


Treasury  bills: 

Regular  weekly: 
Aug.    4  Issued  Feb.  4,  1960: 

Redeemed  in  exchange  for  series 
dated  Aug.  4, 1960,  due  Nov.  3, 

1960 

Redeemed  in  exchange  for  series 
dated  Aug.  4,  1960,  due  Feb.  2, 

1961 , 

Redeemable  for  cash 

Maturing  Nov.  3, 1960: 

Issued    in    exchange    for   series 

dated  Feb  4,  I960— 

Issued  for  cash 

Maturing  Feb.  2,  1961: 

Issued    in    exchange    for    series 

dated  Feb.  4,  1960 — . 

Issued  for  cash 

11  Issued  Feb.  11,  1960: 

Redeemed  in  exchange  for  series 
dated    Aug.     11,     1960,    due 

Nov.  10,  1960 

Redeemed  in  exchange  for  series 
dated  Aug.  11, 1960,  due  Feb.  9, 

1961 

Redeemable  for  cash 

11  Maturing  Nov.  10,  1960: 

Issued    in    exchange    for    series 

dated  Feb.  11, 1960.. 

Issued  for  cash 

11  Maturing  Feb.  9,  1961: 

Issued    in    exchange    for    series 

dated  Feb.  11,  1960 

Issued  for  cash 

15     Treasury  notes.  Series  C-1960: 

Redeemed  in  exchange  for  certificates, 

Series  C-1961 

Redeemed  in  exchange  for  3  J6%  Treasury 

bonds  of  1968  (additional  issue) 

Redeemable  for  cash 

15     Treasury  bonds  of  1961: 

Redeemed    in    exchange    for    Treasury 

notes.  Scries  D-1964 

Redeemed    in    exchange    for    Treasury 

bonds  of  1968 

15     Treasury  notes,  Series  D-1964: 

Issued  in  exchange  for  21/2%  Treasury 

bonds  of  1961- 

15     Certificates  of  indebtedness,  Series  C-1961: 
Issued  in  exchange  for  Treasury  notes, 

Series  C-1960- 

Issued  for  cash 

Footnotes  at  end  of  table. 


Percent 

m 

3Ji 
2^ 


8  $1,599, 000. 00 
243, 000. 00 


4.00 
2.00 
2.00 


2% 


465, 000. 00 
205,  500. 00 


5  3. 431 


2.132 


2.409 


«  3. 478 


2.458 


4M 


2Vz 


67, 904, 000. 00 


11, 378,  522, 145. 16 


122, 764, 000. 00 
877, 371, 000. 00 


41,  220, 000.  00 
358,  799, 000. 00 


135,  552, 000. 00 
964, 731, 000. 00 


51,  612, 000. 00 
448, 414, 000. 00 


i  555, 000.  00 


5,  751, 005, 000. 00 
2,077,770,000.00  | 


8  $1,  599, 000. 00 
243, 000. 00 

26, 000. 00 
30,  552,'56o.  65 

67, 904, 000. 00 
"'43,'3i4,'200"6o 


8, 632, 925, 721. 83 


122,  764, 000. 00 


41,  220, 000.  00 
1,  236,  552, 000. 00 


135,  552, 000. 00 


51,  612, 000. 00 
1, 403,  884, 000. 00 


5,  751, 005, 000. 00 


28, 377, 000. 00 
3,  781, 184, 000. 00 


8  555, 000. 00 
500. 00 


TABLES 


577 


Table   37. — Issues,    maturities,    and  redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 


Security- 


Rate  of 
interest  2 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


1960 
Aug.  15 


25 


25 


Treasury  bonds  of  1968  (additional  issue)  : 
Issued  in  exchange  for  Treasury  notes, 

Series  C-1960 

Issued  in  exchange  for  Treasury  bonds 

of  1961- 

Issued  for  cash 

Treasury  bills: 

Regular  weekly: 

Issued  Feb.  18,  1960: 

Redeemed  in  exchange  for  series 
dated  Aug.  18,  1960,  due  Nov. 

17,  1960 

Redeemed  in  exchange  for  series 
dated  Aug.  18,  1960,  due  Feb. 

16,  1961-— - — 

Redeemable  for  cash 

Maturing  Nov.  17,  1960: 

Issued    in    exchange    for    series 

dated  Feb.  18,  1960 

Issued  for  cash 

Maturing  Feb.  16, 1961: 

Issued    in    exchange    for   series 

dated  Feb.  18,  1960 

Issued  for  cash 

Issued  Feb.  25,  1960: 

Redeemed  in  exchange  for  series 
dated  Aug.  25,  1960,  due  Nov. 

25,  I960- - — 

Redeemed  in  exchange  for  series 
dated  Aug.  25,  1960,  due  Feb. 

23,  1961 

Redeem? ble  for  cash 

Maturing  Nov.  25, 1960: 

Issued  in  exchange  for  series  dated 

Feb.  25, 1960 

Issued  for  cash.  — 

Maturing  Feb.  23,  1961: 

Issued    in    exchange    for   series 

dated  Feb.  25.  1960 

Issued  for  cash.. 

U.S.  savings  bonds: « 

Series  E-1941 

Series  E-1942 

Series  E-1943-. 

Series  E-1944 

Series  E-1945 

Series  E-1946 

Series  E-1947 - 

Series  E-1948 

Series  E-1949 

Series  E-1950— 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1962  (May  to  December). 

Series  E-1953 

Series  E-1954. 

Series  E-1955 

Series  E-1956 

Series  E-1957  (January) 

Series  E-1957  (February  to  December) . . . 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (June  to  December) 

Series  E-1960— 

Unclassified  sales  and  redemptions 

Series  F-1948-. - -- 

Series  F-1949 

Series  F-1950- --. 

Series  F-1951 --. 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  G-1948 

Series  G-1949 

Series  O-1950 

Series  G-1951- 


Percent 


$28,  377,  000. 00 

500. 00 
1, 041, 697, 000. 00 


6  3.918 


2.278 


2.621 


110,074,000.00 
990,011,000.00 


52,  763, 000. 00 
447,  572, 000. 00 


2.518 


2.806 


'  2. 962 

'  3. 007 

'  3. 046 

^  3. 069 

7  3. 097 

7  3. 118 

'  3. 146 

7  3.168 

'  3, 266 

'  3.  347 

'  3.  378 

3.400 

'  3. 451 

^  3. 468 

'  3. 497 

'  3.  522 

'  3.  546 

3.560 

'  3.  653 

7  3.  691 

3.730 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 
2.53 


51,  344, 000. 00 
1, 048, 675, 000. 00 


5,  756, 000. 00 
495, 108, 000. 00 


467.  58 
958. 35 
836.  28 
098. 91 
617. 41 
824.  83 
575.  57 
086.  24 
897. 63 
447.  98 
139. 45 
041.  50 
779.  67 
996.  67 
660.  27 
705.  59 
890. 08 

628. 48 

473. 14 
724. 93 
720. 07 
961. 39 
207.  65 

310. 15 
073.  70 

069. 49 
729. 70 
624. 48 
816.  70 


693, 
3, 876, 
4, 194, 
7, 983, 
4, 025, 
3, 108, 
3, 578, 
4, 025, 

4,  576, 
5, 891, 

5,  792, 
2, 950, 
2, 348, 
5,  231, 

5,  303, 
5, 758, 
5, 217, 

6, 
5, 805, 

6,  225, 
3, 095, 
2,  599, 

363, 800. 

9  62,  988, 
128, 
316, 
227, 
173, 


2.50 
2.50 
2.50 
2.50 


1, 000. 00 


$110,074,000.00 


52,  763, 000.  00 
1, 437,  420, 000. 00 


51, 344, 000. 00 


5,  756, 000. 00 
1,  543, 016, 000. 00 


3, 665, 

15,  263, 

23, 958, 

30, 375, 

25, 817, 

13, 394, 

14, 602, 

17,  639, 

20,  765, 

31,  564, 

8, 762, 

3, 037, 

6, 726, 

11, 893, 

13, 478, 

15, 003, 

16, 526. 

1, 607, 

19,  624, 

30,  648, 

17,  632, 

41, 340, 

97, 828, 

» 85, 922, 

65, 045, 

1, 107, 

1, 273, 

589, 

135, 

»  59,  688, 

152,  334, 

6, 105, 

8,888, 

3, 705, 


271. 48 
921. 89 

239. 38 
531. 19 
909.  53 
746.  72 
927. 97 
186. 31 
596.  75 
275. 96 
676. 06 

340. 82 

981. 10 
730. 09 
398.  29 
940.25 

104. 11 
932. 91 
600.63 
918. 41 
236.35 
947. 36 
726. 99 

597. 83 
026.50 
806. 19 
979.  36 
436. 31 
436. 59 

395. 39 
800. 00 
900.00 
700. 00 
700.00 


Footnotes  at  end  of  table. 


578   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Tabi,e   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960- June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  ^ 

Amount  issued ' 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 

1900 
Aug.  31 

U.S.  savings  bonds  '—Continued 

Series  0-1952 

Percent 
2.50 

$852, 300. 00 

«  132,  819, 000. 00 

559  500  00 

31 

Unclas.sifiod  sales  and  redemptions 

31 

Series  il-19.')2 

7  3. 123 

'  3. 161 

'3.211 

^  3.  258 

'3.317 

3.360 

'  3.  626 

'  3.  679 

3.720 

3.750 

3.750 

31 

Series  H-ig.W 

1,  525, 000.  00 
2, 805,  500. 00 
4,  406, 000. 00 
3  522  000  00 

31 

Scries  n-1954 

31 

Series  H-1955 

31 

Series  11-1956.— 

31 

Series  11-19.57  (.lanuary) 

206  ,500  00 

31 

Series  Il-igsyCt'ebruary  to  December) 

Series  n-1958 

2,  122,  000.  00 

31 

3  927  000  00 

31 

Series  H-1959  (January  to  May)— - 

1,  348, 000. 00 
1,  502,  500. 00 

31 

Scries  ll-19r>^  (June  to  December) 

Series  H-1960 

31 

$75, 058,  500.  00 
»  3,  686, 000. 00 
66, 142.  65 
186,059.11 
380,  577.  83 
281,282.33 
306, 096.  21 
81, 934.  23 

626  500  00 

31 

Unclassified  sales  and  redemptions 

»  1,679,000  00 

31 

Series  J-1952.. 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

296, 417.  20 
1,252  175  44 

31 

Series  J-1953 

31 

Scries  J-1954- 

2, 071,  583.  54 

31 

Series  J-1955.. 

1  594  291  00 

31 

Series  J-1956 

1, 174,  703. 89 

31 

Series  .T-19r)7 

253,  346.  63 

31 

Unclassified  sales  and  redemptions 

9  977  895  12 

31 

Scries  K-1952 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

1,604,500.00 

31 

Si^ics  K-1953 

1  913  000  00 

31 

Scries  K-1954 

5, 902  .500  00 

31 

Series  K-igss 

5,604.500  00 

31 

Series  K-1956 

2,  255, 000. 00 

31 

Series  K-1957... _ 

232  500  00 

31 

Unclassified  sales  and  redemptions  ... 

»  6, 153,  500. 00 

31 

Treasury  notes,  Series  15-1962: 

Redeemable  for  cash  (Feb.  15,  1960,  op- 
tion)  

4.000 
2.000 
2.000 

2H 
1^ 

35, 000. 00 

31 

1, 940,  500. 00 
2,  789, 000. 00 

1, 268,  500. 00 

31 

Treasury  bonds,  R.R.A.  Series 

31 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  exchange  for  Treasury 
notes,  Series  EA-1965 

43,  503, 000  00 

31 

Treasury  notes,  Series  EA-1965 

43,  503, 000. 00 

31 

12, 492,  200. 00 

Total  August. 

15, 615, 008, 335. 95 

16,289.931,054.86 

Treasury  hills: 

Regular  weekly: 

Issued  Mar.  3,  I960: 

Redeemed  in  exchange  for  series 
dated  Sept.  1,  1900,  due  Dec.  1, 
1960 . 

« 3.  524 

Sept.    1 

83,  796,  000  00 

Redeemed  in  exchange  for  series 
dated  Sept.  1, 1960,  due  Mar.  2, 
1901 

51,  709,  000.  00 

Redeemable  for  cash 

1, 365, 153,  000.  00 

1 

Maturing  Dec.  1,  1960: 

Issued    in    exchange    for    series 
dated  Mar  3,  1960 

2.549 

83, 796,  000. 00 
916, 642, 000. 00 

51.709.000.00 
454,  015,  000. 00 

1 

Maturing  Mar.  3,  1901: 

Issued    in    exchange    for    series 
dated  Mar  3,  1960 

2.825 

Issued  for  cash      ..  . 

8 

Issued  Mar.  10,  1960: 

Redeemed  in  exchange  for  series 
dated  Sept.  8,  I960,  due  Dec.  8, 
1960 

Redeemed  in  exch-inge  for  series 
dated  Sept.  8, 1900,  due  Mar.  9, 
1961    

«  3. 043 

9,  345, 000. 00 
I,  402,  000.  00 

1, 589,  518, 000. 00 

8 

Maturing  Dec.  8,  1960: 

Issued    in    exchange    for    series 
dated  Mar.  10,  1960 

2.520 

9,  345,  000. 00 
1, 099,  368, 000. 00 

1,402,000.00 
499, 190, 000. 00 

8 

Maturing  Mar.  9,  1961: 

Issued    In    exchange    for    series 
dated  Mar  10,  1960        

2.801 

Issued  for  cash 

Footnotes  at  end  of  table. 


TABLES 


579 


Table   37. — -Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 


1960 
Sept.  15 


22 


22 


22 


29 


29 


29 


Security 


Treasury  bills— Continued 

Regular  weekly— Continued 
Issued  Mar.  17,  1960: 

Redeemed  in  exchange  for  series 
dated     Sept.     15,     1960,     due 

Dec.  15,  1960 

Redeemed  in  excliangc  for  series 
dated     Sept.    15,     1960,    due 

Mar.  16,  1961 

Redeemable  for  cash 

Maturing  Dec.  15,  1960: 

Issued    in    exchange    for    series 

dated  Mar.  17, 1960 

Issued  for  cash 

Maturing  Mar.  16,  1961: 

Issued    in    exchange    for    series 

dated  Mar.  17,  1960 

Issued  for  cash 

Issued  Mar.  24,  1960: 

Redeemed  in  exchange  for  series 
dated     Sept.    22,     1960,     due 

Dec.  22,  1960 

Redeemed  in  exchange  for  series 
dated  Sept.  22,  1960,  due  Mar. 

23,  1961 

Redeemable  for  cash 

Maturing  Dec.  22,  1960: 

Issued    in    exchange    for    series 

dated  Mar.  24,  1960 

Issued  for  cash - 

Maturing  Mar.  23,  1961: 

Issued    in    exchange    for   series 

dated  Mar.  24, 1960. 

Issued  for  cash -.. 

Issued  Mar.  31,  1960: 

Redeemed  in  exchange  for  series 
dated     Sept.    29,     1960,    due 

Dec.  29,  I960.. 

Redeemed  in  exchange  for  series 
dated     Sept.    29,     1960,     due 

Mar.  30,1961 

Redeemable  for  cash 

Maturing  Dec.  29,  1960: 

Issued    in    exchange    for   series 

dated  Mar.  31,  1960 

Issued  for  cash 

Maturing  Mar.  30,  1961: 

Issued    in    exchange    for    series 

dated  Mar.  30,  1960 

Issued  for  cash 

U.S.  savings  bonds: « 


30 

Seri 

80 

Seri 

30 

Sen 

30 

Sen 

30 

Seri 

30 

Seri 

30 

Seri 

30 

Seri 

30 

Sen 

30 

Sen 

30 

Seri 

30 

Seri 

30 

Seri 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Sen 

30 

Un( 

es  E-1941. 

es  E-1942 

esE-1943 

es  E-1944 

es  E-1945 

es  E-1946 

es  E-1947 

es  E-1948— 

es  E-1949 

es  E-19.50 

es  E-1951 

es  E-1952  (January  to  April) 

es  E-1952  (May  to  December) 

es  E-1953 

es  E-1954 

es  E-1955 

es  E-1956 

es  E-1957  (January) 

es  E-1957  (February  to  December). 

es  E-1958 

OS  E-1959  (January  to  May) 

es  E-1959  (June  to  December) 

es  E-1960- 


Unclassified  sales  and  redemptions. 


Rate  of 
interest  ^ 


Percent 
5  2. 623 


2.654 


i  2.  754 


2.433 


2.743 


5  2. 609 


2.286 


2.729 


?  2. 962 

7  3.  007 

7  3.  046 

7  3.  069 

7  3. 097 

7  3.118 

7  3.146 

7  3. 168 

7  3.  266 

7  3.347 

7  3.  378 

3.400 

7  3.451 

7  3. 468 

7  3. 497 

7  3.  522 

7  3.  546 

3.  560 

7  3. 653 

7  3.  691 

3.730 

3.  750 

3.750 


Amount  issued  3 


$14,  554, 000. 00 
1, 085, 198, 000. 00 


2, 536,  000.  CO 
497,  593, 000. 00 


15,730,000.00 
1, 085, 793, 000. 00 


3, 744, 000. 00 
496,  520, 000. 00 


106,  700, 000. 00 
894, 763, 000. 00 


51, 654, 000.  00 
448, 306, 000. 00 


186. 93 
191.26 
662. 26 
297. 12 

270. 39 
662.  73 
205.  85 
798.  73 
718. 92 
246.  53 
124.  78 
213.  29 
474.  01 
375. 97 
604.  72 
477.  37 
143. 41 
326.  54 
371.44 

378. 40 
164.  05 
048. 04 
171.64 
314.80 


4, 033, 
10,  443, 
3,  738, 
3, 684, 
2, 925, 
3,  525, 
3,  7C3, 
4, 353, 
5, 6.50, 
5,  627, 
2, 803, 
2,  362, 
4, 870, 
5,  186, 
5,  802, 
4, 955, 
8  20, 
5, 605, 
6. 192, 
2.912, 
2, 645, 
341,727, 
»  51, 742, 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


$14,554,000.00 


2,  536, 000. 00 
1,  583, 156, 000.  00 


15,  730, 000.  00 


3,  744, 000. 00 
1,  581,  300, 000. 00 


106, 700, 000. 00 


51, 654, 000. 00 
1,341,938,000.00 


2,  704, 
11,829, 
18,693, 

23,  024, 
19. 074, 
10,  536, 
11,320. 
13,  548. 
15,951, 

24.  482, 
7, 479, 
2,  513, 
5, 370. 
9,  695, 

10, 966, 

12,  588, 

13,  769, 
1,297, 

16,115, 
26. 079, 
14, 735, 
32, 358, 
96,902, 
« 17, 676, 


479.  32 

007. 86 
979. 99 
670.  99 
548.  06 

226. 87 
274.  03 
612. 22 
002. 91 
858.  55 
116.  45 
719.  59 
9.53. 46 
375. 41 
532.11 
668. 06 
131.  54 
577. 02 
355. 45 
109.  51 
756. 02 
759. 00 
083. 68 
501.45 


Footnotes  at  end  of  table. 


580    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table    37.— Issues,    viaturities,    and   redemptions    of  interest-hearing    public   debt 
securities,  excluding  special  issues,  July  1960-June  1961 ' — Continued 


Date 


Security 


Rate  of 
interest  ^ 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


1900 
Sept.  30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 

30 


U.S.  savings  bonds  s — Continued 

Series  F-1948 

Series  F-1949 

Series  F-1950 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  G-1948 

Series  G-1949 

Series  O-1950 

Series  G-1951 

Series  G-1952 

Unclassified  sales  and  redemptions 

Series  H-1952 

Series  H-1953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-19.57  (.January) 

Series  H-19.57  (February  to  December).-. 

Series  H-1958 

Series  H-ig.TO  (January  to  May) 

Series  H-1959  (June  to  December) 

Series  H-1960- - 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J- 1953. 

Series  J-19.'54 

Series  J-1955 

Series  J-1955 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-1952 

Series  K:-1953 

Series  K-1954 __.. 

Series  K-1955. 

Series  K-1956 

Series  K-1957 

Unclassified  sales  and  redemptions 

Treasury  notes,  Series  B-1962: 

Redeemed  for  ca.sh  (Feb.  15, 1960,  option) 

Treasury  notes.  Series  D-1964: 

Issued  in  exchange  for  2\i%  Treasury 
bonds  of  1961-. 

Treasury  bonds  of  1968: 

Issued  in  exchange  for  2!.^%  Treasury 
bonds  of  1961 

Treasury  bonds  of  1961: 

Redeemed    in    exchange    for    Treasury 

notes.  Series  D-1964 

Redeemed  in  exchange  for  3J6%  Treasury 
bonds  of  1968 

Depositary  bonds,  First  Series _- 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series 
B-1975-80:  Redeemed  in  exchange  for 
Treasury  notes,  Scries  EA-1965 

Treasui  y  notes,  Series  EA-1965 

Miscellaneous 


Percent 
2.53 
2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 
2.50 


'  3. 123 

V  3. 161 

7  3.211 

7  3.  258 

'3.317 

3.360 

'  3.  626 

^  3.  679 

3.720 

3.750 

3, 750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


4.000 
2H 


2.00 
2.00 


2?i 


$132,971.00 
312,412.58 
285.922.75 
149, 437. 44 
73, 088. 26 


71, 105,  500. 00 

9  8, 092,  500.  00 

89, 336.  45 

214, 832.  50 

357, 386.  94 

359, 279.  92 

245, 986.  28 

66, 505. 13 


451, 000.  00 
12,000.00 


1, 092,  500. 00 
2, 107, 000. 00 


67,111,000.00 


$7, 048, 

966, 

1, 323, 

714, 

72, 

9  2, 944, 

31,612, 

3,  865, 

3, 822, 

2, 035, 

806, 

9  7, 607, 

671, 

1,371, 

2, 957, 

3, 661, 

2,  888, 

161, 

1, 957, 

3, 3.88, 

1,305, 

1,  746, 
679. 

9  458, 

633, 

781, 

1.413, 

1, 438, 

1, 005, 

211. 

9 1, 803, 

1, 035, 

1, 325. 

4, 190, 

2,  551, 
1,734, 

151, 
9  2, 987, 


855. 00 
349.  76 
188.28 
492. 48 
390. 47 
763. 38 
000.00 
000. 00 
600.00 
700.00 
000.  00 
000. 00 
000.  00 
000. 00 
000.  00 
500. 00 
500. 00 
500.00 
000. 00 

500.  no 

500. 00 
500.  00 
000. 00 
500.  00 
208.  85 
540.58 
554. 18 
(i88.  62 
70S.  16 
141.46 
040. 41 
500.  00 
000. 00 
500.  00 
000. 00 
500. 00 
000.  00 
000. 00 


10, 000. 00 


451,000.00 


12,000.00 
1, 848, 000.  00 


67,111,000.00 
"38,'i77,"766.'66 


Total  September 


8, 336, 305, 80.5.  75 


8, 366, 936, 010.  70 


Tieasury  notes,  Series  EO-1960: 

Redeemable  for  cash 

Treaswv  bonds  of  1980: 

Issued  in  cvchange  for  2]^%  Treasury 

bonds  of  1962-67 

Treasury  bonds  of  1962-67: 

Redeemed  in  exchange  for  3H%  Treasury 

bonds  of  1980 - 

Treasury  bonds  of  1990  (additional  issue) : 
Issued  in  exchange  for  2!^^%  Treasury 
bonds  of  1963-68 


277,  542, 000. 00 


643, 436, 000. 00 


643, 436, 000. 00 


992, 740, 500. 00 


Footnotes  at  end  of  table. 


TABLES 


581 


Table   37 —Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960~June  1961  '— Continued 


Date 


1960 
Oct.     3 


Security 


Rate  of 
interest  ^ 


13 


20 


20 


Treasuiy  bonds  of  1963-68:       „, ,_  ^ 

Redeemed  in  exchange  for  3H%  Treasury 

bonds  of  1990 

Treasury  bonds  of  1998:  „, ,_    „ 

Issued  in  exchange  for  2H%  Treasury 

bonds  of  1964-69  (Apr.  15,  1943,  issue). 

Issued  in  exchange  for  2^%  Treasury 

bonds  of  1964-69  (Sept.  15,  1943,  issue). 

Treasury  bonds  of  1964-69  (Apr.  15,  1943, 

issue) ' 

Redeemed  in  exchange  for  3W7o  Treasury 

bonds  of  1998 v"  V^-.V 

Treasury  bonds  of  1964-69  (Sept.  15,  1943, 
issue) ' 
Redeemed  in  exchange  for  3Vi%  Treasury 

bonds  of  1998 

Treasury  bills: 

Regular  weekly: 

Issued  Apr.  7,  1960: 

Redeemed  in  exchange  for  series 
dated  Oct.  6.  1960,  due  Jan.  5, 

1961 ---- 

Redeemed  in  exchange  for  series 
dated  Oct.  6,  1960,  due  Apr.  6, 

1961  

Redeemable  for  cash 

Maturing  Jan.  5,  1961: 

Issued    in    exchange    for    series 

dated  Apr.  7,  1960 

Issued  for  cash 

Maturing  Apr.  6,  1961: 

Issued    in    exchange    for    senes 

dated  Apr.  7,  1960 

Issued  for  cash 

Issued  Apr.  14,  I960: 

Redeemed  in  exchange  for  series 
dated  Oct.  13, 1960,  due  Jan.  12, 

1961 -.-- 

Redeemed  in  exchange  for  series 
dated  Oct.  13, 1960,  due  Apr.  13, 

1961 

Redeemable  for  cash 

Maturing  Jan.  12,  1961: 

Issued    in    exchange    for    senes 

dated  Apr.  14,  1960 

Issued  for  cash.. 

Maturing  Apr.  13,  1961: 

Issued    in    exchange    for   series 

dated  Apr.  14,  1960 

Issued  for  cash 

Other: 

Issued  Dec.  2,  1959: 

Redeemed  in  exchange  for  series 
dated  Oct.  17,  1960,  due  Oct. 

16,  1961 

Redeemable  for  cash 

Maturing  Oct.  16,  1961: 

Issued    in    exchange    for    series 

dated  Dec.  2,  1959 

Issued  for  cash 

Regular  weekly: 

Issued  Apr.  21, 1960: 

Redeemed  in  exchange  for  series 
dated  Oct.  20, 1960,  due  Jan.  19, 

1961 -.— 

Redeemed  in  exchange  for  series 
dated  Oct.  20, 1960,  due  Apr.  20, 

1961 

Redeemable  for  cash 

Maturing  Jan.  19, 1961: 

Issued    in    exchange    for   series 

dated  Apr.  21, 1960 

Issued  for  cash ----- 


Percent 


2^^ 
5  2.  514 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


$1, 212, 117, 000. 00 
1,130,514,000.00 


2.473 


2.925 


$992, 740, 500. 00 


135, 875, 000. 00 
864, 270, 000.  00 


53, 205, 000. 00 
446, 932, 000. 00 


s  2. 995 


3.079 


1,212,117,000.00 
1,130,514,000.00 

135, 875, 000. 00 


53, 205, 000. 00 
1, 311, 429, 000. 00 


4.860 


3.131 


6  2. 707 


2.406 


95,630,000.00 
904, 674, 000. 00 


2, 180, 000. 00 
498, 300, 000. 00 


95,630.000.00 


2, 180, 000.  GO 
1, 403. 510, 000. 00 


15, 722, 000. 00 
1, 486, 443, 000. 00 


12, 421, 000. 00 
988, 778, 000. 00 


15, 722, 000. 00 
1, 990, 860, 000. 00 


12, 421, 000  00 


2, 349, 000. 00 
1, 385.  553, 000  00 


Footnotes  at  end  of  table. 


582   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-hearing   public   debt 
securities,  excluding  special  issues,  Juhj  1960-June  1961  ' — Continued 


Date 


Security 


Rate  of 
interest  ^ 


Amount  issued  3 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


WOO 
Oct.  20 


Treasury  bilLs— Continued 

Regular  weekly— Continued 
Maturing  Apr.  20,  1961: 

Issued    in    exchange    for    series 

dated  Apr.  21,  1960 

Issued  for  cash 

Tax  anticipation: 

Maturing  June  22, 1961: 

Issued  for  cash 

Regular  weekly: 

Issued  Apr.  28, 1960: 

Redeemed  in  exchange  for  series 
dated  Oct.  27, 1960,  due  Jan.  26, 

1961 

Redeemed  in  exchange  for  series 
dated  Oct.  27, 1960,  due  Apr.  27, 

1961 

Redeemable  for  cash 

Maturing  Jan.  26,  1961: 

Issued    in    exchange    for   series 

dated  Apr.  28, 1960 

Issued  for  cash 

Maturing  Apr.  27,  1961: 

Issued    in    exchange    for   series 

dated  Apr.  28,  1960 

Issued  for  cash 

Treasury  notes.  Series  B-1962: 

Redeemable    for    cash    (Feb.    15,    1960 

option) 

Treasury  notes.  Series  D-1964: 

Issued  in  exchange  for  2}^%  Treasury 

bonds  of  1961 

Treasury  bonds  of  1968: 

Issued  in  exchange  for  2]^%  Treasury 

bonds  of  1961 

Treasury  bonds  of  1961: 

Redeemed    in    exchange    for    Treasury 

notes,  Series  D-1964 

Redeemed    in    exchange    for    Treasury 

bonds  of  1968 

U.S.  savings  bonds: ' 

Series  E-1941 

Series  E-1942 

Series  E-1943 -. 

Series  E-1944 

Series  E-1945 

Series  E-1946 

Series  E-1947 

Series  E-1948 

Series  E-1949 

Series  E-1950 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 -- 

Series  E-1954 

Series  E-1955 - - -.- 

Series  E-1956 ,.. 

Series  E-1957  (January) 

Series  E-1957  (February  to  December)... 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (June  to  December) 

Series  E-1960 

Unclassified  sales  and  redemptions 

Series  F-1948- 

Series  F-1949 

Series  F-1950. 

Series  F-1951— 

Series  F-1952. 

Unclassified  sales  and  redemptions. 

Series  a-1948 

Series  a-1949 

Series  G-1950 


Percent 
2.806 


2.788 


6  2.  776 


$2, 349, 000. 00 
398,  716,  000.  00 


3,  503,  766, 000. 00 


2.569 


4.  COO 
ZVi 

3Ji 
2M. 


'  2. 962 

^  3.  007 

^  3.046 

^  3. 069 

^  3. 097 

'3.118 

^  3. 146 

7  3.168 

1  3.  266 

^  3.  347 

^  3. 378 

3. 400 

7  3.451 

'  3. 468 

^  3. 497 

'  3.  522 

^  3.  546 

3.  560 

'  3. 653 

^  3.  691 

3.730 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 


136, 422,  000. 00 
864, 218, 000.  00 


43, 148,  000. 00 
356, 939, 000.  00 


8  90, 000.  00 
8 1,  500.  00 


789, 
4, 212, 
8, 031, 
3,415, 

4,  526, 
3,  017, 
3. 348, 

3,  579, 
4, 045, 
5,314, 

5,  689, 
2  532, 
2, 467, 

4,  930, 
4,941, 

5,  594, 
4,  857, 

5, 737, 

6, 220, 

2  823, 

3, 065, 

304, 835. 

«  7,  815. 

120, 

291, 

1, 162, 

175, 

59, 


514.02 
344.  59 
926. 82 
200.  59 
933.  69 
631. 05 
961.  53 
813. 84 
429. 13 
935.  43 
460.  54 
213. 84 
102. 45 
118.40 
581.22 
236. 30 
256. 53 
8 14.  64 
317.80 
233.  73 
417.81 
528. 41 
911.62 
003.  32 
831.00 
024. 87 
101.  09 
881.30 
722. 91 


$136, 422, 000.  00 


43, 148, 000.  00 
1,  220, 826,  000.  00 


4, 000. 00 


'  90,  000. 00 


8  1,500.00 


2, 388, 

10,  461, 

16, 959, 

19, 986, 

16, 705, 

9, 166, 

9, 899, 

11,997, 

13, 654, 

21, 722, 

6,884, 

2, 278, 

4, 950, 

9, 118. 

10. 352, 

11,487, 

12, 636, 

1,131, 

16, 163, 

21, 697, 

12,707, 

26, 219, 

96, 646, 

9  22, 107, 

5. 432, 
425, 
531, 
374, 

75, 

1. 433, 
23, 534, 

3, 222, 
3,229, 


596. 07 
044. 02 
872. 34 
616.  52 
560. 10 
626.  78 
495.92 
878. 61 
356. 41 
621. 20 
341. 25 
699.96 
680. 80 
689. 68 
483. 23 
177. 68 
939. 67 
717.  53 

690. 49 
430. 94 
492. 77 
098. 73 
022.  42 
554.96 

900. 50 
843. 79 
282. 89 
804. 86 
490. 33 
844. 89 
300. 00 
400.00 
400. 00 


Footnotes  at  end  of  table. 


TABLES 


583 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-hearing    'public   debt 
securities,  excluding  special  issues,  Juhj  1960-June  1961  ^ — Continued 


Date 


Security 


Rate  of 
interest  2 


Amount  issued  ^ 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


1960 
Oct.  31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 
31 


Nov.    3 


U.S.  savings  bonds  «— Continued 

Series  Ci-1951 

Series  G-1952 

Unclassified  sales  and  redemptions 

Series  H-1952 

Series  n-I953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-1957  (January) 

Series  n-1957  (February  to  December)... 

Series  11-1958 

Series  H-1959  (January  to  May) 

Series  H-1959  (June  to  December) 

Series  H-I9(i0 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J-1953 

Series  J-I954 

Series  J-1955 

Series  J-1956 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-1952 

Series  K-I953 

Series  K-1954 

Series  K-1955 

Series  K-1956.. 

Series  K-1957 

Unclassified  sales  and  redemptions 

Depositary  bonds,  First  Series 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series  B-1975- 
80:   Redeemed  in  exchange  for  Treasury 

notes.  Scries  EA-1965 

Treasury  notes.  Series  EA-1965 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  exchange  for  Treasury 

notes.  Series  EO-1965 

Treasury  notes.  Series  EO-1955 -.. 

Miscellaneous.  


Percent 
2.50 
2.50 


7  3. 123 

'  3. 161 

'3.211 

'  3. 258 

'3.317 

3.360 

'  3. 626 

'  3. 679 

3.720 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


$59,  300, 000. 00 
1,  373,  000. 00 
103, 054. 70 
188, 219. 00 
350, 729. 21 
348, 024.  57 
180, 047. 79 
69,722.96 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.00 
2.00 


2H 


2% 


1, 162, 000. 00 
1,037,000.00 


$1, 893, 

707, 

3,  318, 

516, 

1,  230. 

2, 624, 

3,  568, 

2, 851, 

355, 

1,  702, 

3, 150, 

1, 053, 

1,  398, 

1, 688, 

e  1, 032, 

342, 

434, 

1,308, 

1, 125, 

757, 

114, 

8  651, 

702, 

986, 

2, 896, 

2, 051, 

1, 119, 

317, 

0  675, 

21,296, 


500. 00 
200.  00 
200.  00 
000.  00 
500.  00 
000.  00 
500. 00 
000. 00 
500. 00 
000. 00 
000. 00 
000.  00 
500.  00 
000.00 
000. 00 
290. 45 
965.  09 
822. 18 
109. 18 
152. 43 
969. 63 
685.  57 
500. 00 
500.  00 
000.00 
000  00 
000.00 
500. 00 
500. 00 
500. 00 


229, 690, 000. 00 


229, 690, 000. 00 


51, 382, 000. 00 


51, 382, 000. 00 
"2i,"938,"206.'00 


Total  October. 


15,  521  859, 411.  38 


12, 806, 921, 068.  81 


Treasury  bills: 

Regular  weekly: 

Issued  May  5,  1960: 

Redeemed  in  exchange  for  series 
dated  Nov.  3,  1960,  due  Feb.  2, 

1961 

Redeemed  in  exchange  for  series 
dated  Nov.  3,  1960,  due  May  4, 

1961 

Redeemable  for  cash 

Maturing  Feb.  2,  1961: 

Issued    in    exchange    for    series 

dated  May  5,  1960 

Issued  for  cash  - .  

Maturing  May  4,  1961- 

Issued    in    exchange    for    series 

dated  May  5,  1960 

Is.sued  for  cash. .  

Issued  May  12,  1960: 

Redeemed  in  exchange  for  series 
dated  Nov.  10, 1960,  due  Feb.  9, 

1961 

Redeemed  in  exchange  for  series 
dated  Nov.  10,  1960,  due  May 

11,  1961 

Redeemable  for  cash 

Maturing  Feb.  9,  1961: 

Issued    in    exchange    for    series 

dated  May  12,  1960 

Issued  for  cash — 


5  2. 479 


143, 932, 000. 00 


54, 696. 000. 00 
1, 201, 521, 000.  00 


2.128 


2.453 


143, 932. 000. 00 
856,  659, 000. 00 


54, 696. 000. 00 
345, 444, 000.  00 


152,  547, 000.  00 


53,117,000.00 
1, 299,  608, 000. 00 


2.390 


152, 547, 000. 00 
947, 830, 000. 00 


Footnotes  at  end  of  table. 


584   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 


Security 


Rate  of 
interest  ^ 


Amount  issued  3 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


1960 
Nov.  10 


15 


15 


15 


15 


17 


17 


25 


Treasury  bills— Continued 

Regular  weekly— Continued 
Maturing  May  11,  1961: 

Issued    in    exchange    for    series 

dated  May  12,  1960 

Issued  for  cash . .  

Treasury  notes,  Series  F-1962: 

Issued  in  exchange  for  454%  certificates, 

Series  C-1960 

Issued  in  exchange  for  2M,%  Treasury 

bonds  of  1960 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  4J4%  certificates, 

Series  C-1960 

Issued  in  exchange  for  2!^%  Treasury 

bonds  of  1960 

Certificates  of  indebtedness,  Series  C-196n: 
Redeemed  in  exchange  for  3H%  Treasury 

notes,  Scries  F-1962 

Redeemed  in  exchange  for  3%%  Treasury 

bonds  of  1966 

Redeemable  for  cash 

Treasury  bonds  of  1960: 

Redeemed  in  exchange  for  3)4%  Treasury 

notes,  Series  F-1962...  

Redeemed  in  exchange  for  3?4%  Treasury 

bonds  of  1966 

Redeemable  for  cash 

Treasury  bills: 

Regular  weekly: 

Issued  May  19, 1960: 

Redeemed  in  exchange  for  series 
dated  Nov.  17,  1960,  due  Feb. 

16,  1961 

Redeemed  in  exchange  for  series 
dated  Nov.  17,  1960,  due  May 

18,  1961. -._ 

Redeemable  for  cash 

Maturing  Feb.  16,  1901: 

Issued    in    exchange    for    series 

dated  May  19,  1960 

Issued  for  cash. 

Maturing  May  18,  1961: 

Issued    in    exchange    for    series 

dated  May  19,  1960 

Issued  for  cash 

Issued  May  26,  1960: 

Redeemed  ta  exchange  for  series 
dated  Nov.  25, 1960.due  Feb.  23, 

1961    

Redeemed  in  exchange  for  series 
dated  Nov.  25,  1960,  due  May 

25,  1961...- 

Redeemable  for  cash 

Maturing  Feb.  23,  1961: 

Issued    in    exchange    for    series 

dated  May  26,  1960 

Issued  for  cash 

Maturing  May  25,  1961: 

Issued    in    exchange    for    series 

dated  May  26,  1960 

Issued  for  cash 

Treasun'  bonds  of  1980: 

Issui^d  in  exchange  for  2i^%  Treasury 

bonds  of  1962-67 

Treasury  bonds  of  1962-67: 

Redeemed  in  exchange  for  ZW7o  Treasury 

bonds  of  1980 

Treasury  bonds  of  1998: 

Issued  in  exchange  for  2M%  Treasury 

bonds  of  1964-69  (dated  Apr.  15,  1943).. 

Treasui-y  bonds  of  1964-69  (dated  Apr.  15, 

1943) : 

Redeemed  in  exchange  for  3;.^%  Treasury 

bonds  of  1998 


Percent 
2.572 


314 


Wi 


$53,117,000.00 
347,  089, 000. 00 


6, 431, 485, 000.  00 
2, 666, 746, 000. 00 

335, 250, 000. 00 
877,  859,  500. 00 


2M. 


»  2. 816 


S,  431, 485, 000. 00 


335, 250, 000. 00 
270, 471, 000.  00 


2,666,746,000.00 

877, 859,  50n.  00 
261,877,500.00 


171, 358, 000. 00 


63, 177. 000. 00 
1, 365,  590. 000.  00 


2.624 


2.825 


171, 358, 000. 00 
929, 946,  000. 00 


63,177,000.00 
436, 798, 000. 00 


«  2. 940 


82,  718, 000.  00 


7, 375, 000.  00 
1, 510, 049, 000. 00 


2.396 


2.749 


m 

3^4 
2H 


82,  718, 000. 00 
1,019,458,000.00 


7, 375, 000.  00 
494, 419, 000. 00 


1 10, 000. 00 


8  10, 000. 00 


8  78, 500. 00 


8  78, 500. 00 


Footnotes  at  end  of  table. 


TABLES 


585 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960~June  1961  ^ — Continued 


Security 


Rate  of 

interest  ^ 


Amount  issued  ^ 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


1960 
Nov.  30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 
30 


U.S.  savings  bonds:  ^ 

Series  E-1941 

Series  E-1942 

Series  E-1943 

Series  E-1944 

Series  E-1945 

Series  E-1946 

Series  E-1947 

Series  E-1948 

Series  E-1949 

Series  E-1950 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 

Series  E-1954 

Series  E-1955 

Series  E-1956 

Series  E-1957  (January) 

Series  E-19,'57  (February  to  December)... 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (June  to  December) 

Series  E-1960 

Unclassified  sales  and  redemptions 

Series  F-1948 

Series  F-1949 

Series  F-1950 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  G-1948 

Series  G-1949 

Series  G-1950 

Series  G-1951 

Series  G-1952 

Unclassified  sales  and  redemptions 

Series  H-1952 

Series  H-1953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-1957  (January) 

Series  H-1957  (February  to  December)... 

Series  H-1958 

Series  H-1959  (January  to  May)  — 

Series  H-1959  (June  to  December) 

Series  H-1960..._ .--. 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J-1953 

Series  J-1954 

Series  J-1955 

Series  J-1956 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-1952 

Series  K-1953 

Series  K-1954 

Series  K-1955 

Series  K-1956 

Series  K-1957 

Unclassified  sales  and  redemptions 

Depositary  bonds,  First  Series 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  exchange  for  Treasury 

notes.  Series  EA-1965 

Treasury  notes,  Series  EA-1965 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  e.xchange  for  Treasury 

notes,  Series  EO-1965 

Treasury  notes,  Series  EO-1965 

Miscellaneous 


Percent 

'  2.  962 

7  3. 007 

^  3.  046 

7  3.  069 

'  3.  097 

'3.118 

'  3. 146 

'  3. 168 

'  3.  266 

7  3.  347 

7  3.  378 

3.400 

7  3.  451 

^  3.  468 

'  3.  497 

'  3.  522 

1  3.  546 

3.560 

7  3.  653 

'  3.  691 

3.730 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 
2.50 


'  3. 123 

^  3. 161 

7  3.211 

7  3.  258 

7  3.317 

3.360 

7  3.  626 

7  3.  679 

3.720 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.00 
2.00 


2M 
VA 


Total  November. 


$1, 473, 
3, 876, 

4,  203, 

5,  915, 
11,070, 

3, 013, 
3, 067, 

3,  591, 
4, 009, 
5, 134, 
5, 337, 

8  14, 

4,  537, 
4,  574, 
4, 818, 
5, 377, 

4,  704, 

6, 007, 

5,  897, 
2,  691, 
2, 801, 

354,  729, 
9  74, 444, 
118, 
298, 
407, 
152, 


023. 68 
192. 83 
116. 42 
502.  59 
748. 95 
384. 18 
042.  93 
360.  98 
445.  87 
551.  47 
996.  66 

704. 07 
982.  77 

429. 08 
545.  31 
816. 90 
153.  27 

5.72 
126. 08 
063. 04 
129.  25 
067.  .59 
516.  97 
274. 18 
992. 00 
044.  96 
177.  66 
091. 08 
277.  65 


18, 000. 00 

49,  577, 000. 00 

8, 860, 000. 00 

212, 524.  55 

206,  312.  52 

383, 459. 01 

292,  242.  55 

182,  609.  46 

8  208.  63 


249,  500.  00 
2,  941, 000. 00 


8  195, 000. 00 


25,112,000.00 


16,  879, 002,  691. 80 


$3, 170, 

14,  642, 
23,  972, 
26,  921, 
22,941, 
12, 347, 
13, 497, 
15, 677, 
18, 043, 
29, 804, 

9,  263, 
3, 118, 
6, 757, 
11,  783, 
13, 483, 

15,  352, 
16, 743, 

1,  415, 
19,  734, 
24, 445, 
12, 893, 
25, 439, 

107,  624, 

'  112,  516, 

6,  708, 

354, 

847, 

278, 

67, 

9  2, 906, 

31,  819. 

2,  741, 
5, 365 

1,  687, 
457, 

9 12, 666, 

586, 

1, 326. 

2, 363, 

2,  994, 
2, 825, 

182, 

1, 974, 

2, 877, 

1,  252, 

1,  292, 

1,514, 

«830, 

422, 

593, 

1, 0.38, 

942, 

493, 

69, 

» 1, 187, 

613, 

1,017, 

3, 129. 

1,  675, 
876, 
149. 

0  1, 354 

2,  202, 


025. 35 
972.  46 
773.  95 
664.  40 
036. 12 

259. 91 
078.  44 
458.  05 
348. 60 
969.24 

434. 36 
378.  20 
906.  25 
470.  77 
030. 81 
812.  52 
165.  79 

062. 92 
271. 57 
063. 38 
948. 15 
116.17 
342. 81 
217. 43 
331. 00 
502.68 
703. 27 
580. 47 
408. 96 
976.  23 
800.00 
500. 00 
000. 00 
000. 00 
300. 00 
600. 00 
000. 00 
500. 00 
500. 00 
500. 00 
500. 00 
500.  00 
000. 00 
500. 00 
500. 00 
500. 00 
000.00 
000.00 
594.90 
587. 34 
246.  98 
399.  86 
177.  27 
408. 00 
780. 87 
000. 00 
000. 00 
500. 00 
500. 00 
000.00 
000. 00 

,  500. 00 
500. 00 


8 195, 000.  00 


25, 112, 000. 00 

'23,'66i,'666."66 


17, 398, 155, 056.  42 


Footnotes  at  end  of  table. 


586   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issiies,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 

Security 

Rate  of 
interest  - 

Amount  issued  ' 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 

19G0 
Dec.     1 

Treasury  bills: 

Regular  weekly: 

Issued  June  2,  1960: 

Redeemed  in  exchange  for  series 
dated  Dec.  1,  1960,  due  Mar.  2, 
1961 

Percent 
5  2.  865 

$13,  573, 000. 00 
1  662  000  00 

Redeemed  in  exchange  for  series 
dated  Dec.  1,  1960,  due  June  1, 
1961 ._ 

Redeemable  for  cash 

1,  485,  502, 000. 00 

1 

Maturing  March  2,  1961: 

I.ssued    in    exchange    for    series 

dated  June  2,  1960 

Issued  for  cash 

2.326 

$13,  573, 000. 00 
987, 107,  000. 00 

1, 662, 000.  00 
498,  549,  000. 00 

1 

Maturing  June  1,  1961: 

Issued    in    exchange    for    series 
dated  June  2,  1960 

2.640 

Issued  for  cash 

8 

Issued  June  9,  1960: 

Redeemed  in  exchange  for  series 
dated  Dec.  8,  1960,  due  Mar.  9, 
1961 

»  2.  629 

99,  738, 000. 00 

52,  480,  000. 00 
1,  456,  562, 000. 00 

Redeemed  in  exchange  for  series 
dated  Dec.  8,  1960,  due  June  8, 
1961 

Redeemable  for  cash 

8 

Maturing  March  9,  1961: 

Issued    in    exchange    for    series 
dated  June  9,  1960 

2.328 

99,  738, 000.  00 
1, 000, 394, 000. 00 

52, 480, 000. 00 
447,  755,  000.  00 

Issued  for  cash 

8 

Maturing  June  8,  1961: 

Issued    in    exchange    for    series 
dated  June  9,  1960 

2.663 

Issued  for  cash 

15 

Issued  June  16,  1960: 

Redeemed  in  exchange  for  series 
dated  Dec.  15,  1960,  due  Mar. 
16,  1961 

5  2.  605 

78, 149  000  00 

Redeemed  in  exchange  for  series 
dated  Dec.  15,  1960,  due  June 
15,  1961 

17,  255,  000  00 

Redeemable  for  cash 

1,  504,  384,  000  00 

15 

Maturing  March  16,  1961: 

Issued    in    exchange    for    series 
dated  June  16,  1960 

2.334 

78, 149, 000.  00 
1, 020,  239,  000. 00 

17,  255, 000. 00 
484, 063, 000.  00 

144, 565,  500. 00 
353, 000.  00 

Issued  for  cash 

15 

Maturing  June  15,  1961: 

Issued    in    exchange    for    series 
dated  June  16,  1960. 

2.621 

Issued  for  cash.  _ 

15 

Treasury  bonds  of  1969  (additional  issue): 
Issued  in  exchange  for  Series  F  and  O, 
U.S.  savings  bonds... 

4.000 

Issued  for  cash 

22 

Treasury  bills: 

Regular  weekly: 

Issued  June  23,  1960: 

Redeemed  in  exchange  for  series 
dated  Dec.  22,  1960,  due  Mar. 
23,  1961 

5  2.  572 

161,427,000.00 

Redeemed  in  exchange  for  series 
dated  Dec.  22,  1960,  due  June 
23,  1901..           .... 

53, 082, 000.  00 

Redeemable  for  cash 

1,  387, 171, 000.  00 

22 

Maturing  March  23,  1961: 

Issued    in    exchange    for    series 
dated  June  23,  1960 

2.222 

161.  427,  000. 00 
939,  970,  000.  00 

53, 082, 000.  00 
447. 009, 000. 00 

Issued  for  cash 

22 

Maturing  June  23,  1961: 

Issued    in    exchange    for    series 
dated  June  23,  1960 

2.392 

Issued  for  cash.. 

Footnotes  at  end  of  table. 


TABLES 


587 


rp,„p    -^7 —Issues     maturities,    and   redemptions    of  interest-hearing   fuhlic   debt 
^^^"^seZitiLexciuSng  special  issues,  July  1960-June  1961  ^-Continued 


Date 


Security 


Rate  of 
interest  ^ 


1960        Treasury  bills— Continued 

Regular  weekly— Continued 
Dec    29  Issued  June  30,  1960: 

Redeemed  in  exchange  for  scries 
dated  Dec.  29, 1960,  due  Mar.  30, 

1961.— -.-- 

Redeemed  in  exchange  for  series 
dated  Dec.  29,  1960,  due  June 

29, 1961 - 

Redeemable  for  cash— 

29  Maturing  March  30,  1961: 

Issued    in    exchange    for    series 

dated  June  30,  1960 

Issued  for  cash -- 

29  Maturing  June  29,  1961: 

Issued    in    exchange    for    series 

dated  June  30,  I960- - - 

Issued  for  cash... 

U.S.  savings  bonds: » 

31  Series  E-1941.- 

31  Series  E-1942.- - 

31  Series  E-1943 — - 

31  Series  E-1944 

31  Series  E-1945— - 

31  Series  E-1946— - 

31  Series  E-1947 

31  Series  E-1948 - — 

31  Series  E-1949.- — - 

31  Series  E-1950— - — 

31  Series  E-1951 v— .— "n 

31  Series  E-1952  (January  to  April)   - -• 

31  Series  E-1952  (May  to  December)— 

31  Series  E-1953. — 

31  Series  E-1954.- ■ 

31  Series  E-1955- 

31  Series  E-1956- --— - 

31  Seiies  E-1957  (January)— -——--— - 

31  Series  E-1957  (February  to  Decembei).. 

31  Series  E-1958 v-aV"n "'" 

31  Series  E-1959  (January  to  May)    

31  Series  E-1959  (June  to  December) — 

31  Series  E-1960— - %—";•■"; 

31  Unclassified  sales  and  redemptions - 

31  Series  F-1949- — - 

31  Series  F-1950- — 

31  Series  F-1951- 

31  Series  F-1952.. ——---- 

31  Unclassified  sales  and  redemptions 

31  Series  Q-1949 

31  Series  G-1950- - 

31  Series  G-1951- - 

31  Series  G-1952- ———-—- 

31  Unclassified  sales  and  redemptions. 

31  Series  H-1952... - 

31  Series  H-1953 

31  Series  H-1954 — 

31  Series  H-1955 

31  Series  H-1956 - -- 

31  Series  H-1957  (January).--— ----- 

31  Series  H-1957  (February  to  December) - 

31  Series  H-1958 r-Vr-V" 

31  Series  H-1959  (January  to  May)-. 

31  Series  H-1959  (June  to  December) 

31  Series  H-1960— - -7-—;.—: 

31  Unclassified  sales  and  redemptions 

31  Series  J-1952 

31  Series  J-1953 

31  Series  J-1954 

31  Series  J-1955 -- 

31  Series  J-1956 - 

31  Series  J-1957 

31  Unclassified  sales  and  redemptions 

31  Series  K-1952 

31  Series-K-1953.— 

31  Series  K-1954 

Footnotes  at>nd  of  table. 


Percent 
6  2. 459 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


2.148 


2.333 


'  2. 962 

'  3. 007 

'  3. 046 

'  3. 069 

'  3. 097 

^  3. 118 

'  3. 146 

'  3. 168 

^  3.  266 

7  3.  347 

'  3. 378 

3.400 

7  3.451 

7  3.  468 

'  3. 497 

^  3.  522 

7  3.  546 

3.560 

'  3. 653 

'  3.  691 

3.730 

3.750 

3.750 


$134, 882, 000. 00 
866, 017, 000. 00 


53,  575, 000. 00 
447, 058, 000. 00 


2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 


^  3. 123 

^  3. 161 

^  3.  211 

^  3.  258 

7  3.  317 

3.360 

7  3.  626 

7  3.  679 

3.720 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 


3,  869, 
5, 069, 
4, 824, 
13, 883, 
11,433, 
4,045, 
4, 074, 
4, 818, 

5,  755, 
6, 371, 

6,  583, 
8  14, 

5, 905, 
5, 744, 
6, 186, 
6,  646, 

5,  258, 

7, 122, 

6.717, 

8  53, 

6,  280, 
293, 380, 

2, 368, 
362 
549 
172 


969.  55 
296.  79 
651.06 
931. 40 
,  673.  45 
,  571. 94 
,  507. 66 
,  982.  68 
,  345.  78 
.  522.  24 
873. 79 
088.  59 

730. 24 
916.  53 
644.  58 
762. 46 
115.  12 
8  37.  51 
,  640.  89 
,  921. 18 
,  792.  82 
,  525.  22 
,  384. 44 
,  465.  50 

706. 25 
2.50. 47 
874.  38 
8  62. 85 


$134, 882, 000. 00 


53,  575, 000. 00 
1, 313, 309, 000. 00 


69, 151,  500. 00 
9  2, 706, 000. 00 
217, 130. 55 
286,  786. 13 
485.077,41 
325,  535.  40 
225, 128. 09 
8  134. 32 


2, 129, 
9, 142, 
15, 027, 
16, 772, 
15, 029, 
7, 860, 

8,  554. 
10, 064, 
11,  488, 
18,  869, 

5,  629, 
1,915, 
4, 164, 
7,  638, 
8, 424, 

9,  534, 
10, 409, 

848, 

12, 656, 

18, 788, 

10, 203, 

19, 733, 

103, 807, 

26, 963, 

395, 

681, 

223, 

39, 

Ifi,  946, 

2, 724, 

2,  799, 

1,451, 

459, 

146, 746, 

317, 

1, 138, 

2, 246, 

3, 182, 

2, 715, 

125, 

1, 732, 

2, 886, 

1,043, 

1, 155, 

1,741. 

9  146, 

150, 

334, 

671, 

421, 

703, 

150 

»2 

1,097 


2,244 


513. 94 
698. 47 
323. 24 
263.  36 
485.  65 
660. 44 
208. 40 
403.75 
323.  77 
392.60 
839.  25 
999.  72 
313.  79 
697. 34 
570. 47 
508. 10 
831. 12 
929. 98 
371. 27 
811.06 
263.  32 
733. 38 
193. 66 
070. 80 
337.  02 
848. 93 
619. 03 
693. 16 
507. 92 
100. 00 
500. 00 
700. 00 
800. 00 
,  800. 00 
,  000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000.00 
500. 00 
,  000. 00 
,  500. 00 
,  000. 00 
,  000. 00 
,  000. 00 
509. 10 
307. 13 
266. 38 
302. 98 
520. 29 
873.60 
058. 49 
000. 00 
500. 00 
000. 00 


614359—62- 


-38 


588 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. —  Issues,    maturities,    and   redemptions    of  interest-hearing    public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  ■ 

-Amount  issued  3 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 

1960 
Dec.  31 

U.S.  saving.s  bonds  6— Continued 

Series  K-1955...    

Percent 
2.76 
2.76 
2.76 

$1, 171, 000.  00 

31 

Series  K-1956 

717, 000.  00 

31 

Series  K-1957                                    -      .  - 

143, 000. 00 

31 

Unelas?ified  sales  and  redemptions 

9  176,  500.  00 

31 

Treasury  notes,  Series  B-1962: 

Redeemed  for  cash  (Feb.  \b,  1960,  option)  _ 
Treasury  notes,  Series  F-1962: 

Issued  in  exchange  for  2],i%  Treasury 
bonds  of  1960                              - 

4.00 

314 
33/4 
2!4 

12, 000. 00 

31 

8  $188,  000. 00 
21, 000. 00 

31 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  2\i%  Treasury 
bonds  of  1960                   

31 

Treasury  bonds  of  1960: 

Redeemed  in  exchange  for  3J^%  Treasury 

notes,  Series  F-1962 

Redeemed  in  exchange  for  3M%  Treasury 

bonds  of  1966                       ..        .  . 

8  150,000.00 

21,  000.  00 

31 

Treasury  bonds  of  1980: 

Issued  in  exchange  for  23^%  Treasury 
bonds  of  1962-67                 __ 

3H 

2}.i 

m 

3M 

2V2 
2.00 
2.00 

2?4 

8  8, 000. 00 

31 

Treasury  bonds  of  1962-67: 

Redeemed  in  exchange  for  3}^%  Treasury 
bonds  of  1980                  .  

9  8, 000.  00 

31 

Treasury  bonds  of  1990  (additional  issue) : 
Issued  in  exchange  for  2^%  Treasury 
bonds  of  1963-68      

8  25,  000.  00 

31 

Treasury  bonds  of  1963-68: 

Redeemed  in  exchange  for  3^2%  Treasury 
bonds  of  1990      -  

8  25, 000. 00 

31 

Treasury  bonds  of  1998: 

Issued  in  exchange  for  2}^%  Treasury 

bonds  of  1964-69  (Apr.  15, 1943,  i.ssue) . . .  _ 

Treasury  bonds  of  1964-69   (Apr.   15,   1943, 

issue): 

Redeemed  in  exchange  for  33^%  Treasury 

bonds  of  1998 

8  28,  500.  00 

31 

6  28,  500.  00 

31 

Depositary  bonds,  First  Series  -.  . 

21,  290,  000.  00 
1,  740, 000. 00 

2, 048,  500. 00 

31 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series  B-1975-80: 
Redeemed  in  exchange  for  Treasury  notes. 

Series  EO-1965 

Treasury  notes,  Series  E  0-1965 

31 

57,  733, 000. 00 

31 

58, 033, 000. 00 

31 

25,  815,  800  00 

8, 515, 142,  305. 09 

8, 452,  747,  833. 93 

Treasury  bills: 
Regular  weekly: 

Issued  July  7,  1960: 

Redeemed  in  e.xchange  for  series 
dated  Jan.  5,  1961,  due  Apr.  6, 

1961 

Redeemed  in  exchange  for  series 
dated  Jan.  5,  1961,  due  July  6, 
1961-..      

5  2.  584 

1961 
Jan.    5 

164, 176, 000. 00 

52,  586, 000. 00 

Redeemable  for  cash.. 

1,  283,  433, 000. 00 

5 

Maturing  Apr.  6,  1901: 

Issued  in  exchange  for  series  dated 
July  7,  1960               .     

2.235 

164, 176,  000.  00 
836, 700, 000. 00 

52,586,000.00 
447,  650,  000. 00 

5 

Maturing  July  6,  1961: 

Issued  in  exchange  for  series  dated 
July  7,  1960 

2.429 

12 

Issued  July  14,  1960: 

Redeemed  in  exchange  for  series 
dated  Jan.  12, 1961,  due  Apr.  13, 
1961                                   

«  2. 857 

101,  888, 000. 00 

Redeemed  in  exchange  for  series 
dated  Jan.  12, 1961,  due  July  13, 
1961 

52, 188, 000. 00 

Redeemable  for  cash 

1, 346,  417, 000. 00 

Footnotes  at  end  of  table. 


TABLES 


589 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  2 

Amount  issued  3 

Amoimt  matured 

or  called  or 

redeemed  prior 

to  matmity  * 

1961 
Jan. 12 

Treasury  bills— Continued 

Regular  weekly— Continued 
Maturing  Apr.  13,  1961: 

Issued  in  exchange  for  series  dated 
July  14,  1960 

Percevt 
2.835 

$101, 888, 000. 00 
898,  553, 000. 00 

52, 188, 000. 00 
447, 924, 000. 00 

Issued  for  cash 

12 

Maturing  July  13,  1961: 

Issued  in  exchange  for  series  dated 
July  14,  1960 

2.602 

Issued  for  cash 

15 

Other: 

Issued  Jan.  15,  1960: 

Redeemed  in  exchange  for  series 
dated  Jan.  15, 1961,  due  Jan.  15, 
1962 

5.067 

$92,115  000  00 

Redeemable  for  cash 

1, 411,  625, 000  00 

15 

Maturing  Jan.  15,  1962: 

Issued  in  exchanse  for  series  dated 
Jan.  15,  1960 

2.679 

92, 115, 000. 00 
1, 409,  557,  000. 00 

Issued  for  cash.-  -  -. 

19 

Regular  weekly: 

Issued  July  21,  1960: 

Redeemed  in  exchange  for  series 
dated  Jan.  19, 1961,  due  Apr.  20, 
1961 

«  2.  468 

84, 099, 000. 00 

Redeemed  in  exchange  for  series 
dated  Jan.  19, 1961,  due  July  20, 
1961 

33, 914, 000. 00 

Redeemable  for  cash 

" 

1,  283,  239, 000. 00 

19 

Maturing  Apr.  20,  1961: 

Issued  in  exchange  for  series  dated 
July  21,  1960 

2.358 

84, 099, 000. 00 
1, 016, 444, 000. 00 

33,914,000.00 
366,  258, 000. 00 

Issued  for  cash . ... 

19 

Maturing  July  20,  1961: 

Issued  in  exchange  for  series  dated 
July  21,  I960.. 

2.530 

Issued  for  cash 

26 

Issued  July  28,  1960: 

Redeemed  in  exchange  for  series 
dated  Jan.  26, 1961,  due  Apr.  27, 
1961 

«  2. 292 

179, 885, 000. 00 

Redeemed  in  exchange  for  series 
dated  Jan.  26, 1961,  due  July  27, 
1961 

51,  921, 000. 00 

Redeemable  for  cash  ..    

1, 169, 034, 000. 00 

26 

Maturing  Apr.  27,  1961: 

Issued  in  exchange  for  series  dated 
July  28,  1960 

2.230 

179,885,000.00 
920,593,000.00 

51,921,000.00 
448, 130, 000. 00 

1, 041,  760. 98 
7, 026,  776. 35 
5, 623, 692.  59 
10, 975, 294.  52 
5, 649,  996. 14 
4, 340, 138. 13 
4,  987, 624. 04 
5, 478, 862. 02 
5, 874,  689. 11 
6,301,725.62 
7,790,094.81 
4, 062, 194. 31 
2, 626,  645. 12 
6, 801,  551.  77 
6,808,253.95 
7, 206, 096. 17 
7, 213, 073.  46 
2, 276, 860.  29 
3, 249, 539.  36 
7, 558, 821.  70 
3,969,799.79 

26 

Maturing  July  27,  1961: 

Issued  in  exchange  for  series  dated 
July  28,  1960 

2.422 

31 

U.S.  savings  bonds:  ^ 

Series  E-1941 

'  2. 962 
7  3. 007 
7  3. 046 
7  3. 069 
'  3. 097 
7  3. 118 
7  3. 146 
'  3. 168 
?  3. 264 
'  3. 347 
7  3.  378 

3.400 
?  3.  451 
?3.468 
7  3. 497 
'  3.  522 
'3.546 

3.560 
?  3.  653 
'  3. 690 

3.730 

3, 548,  273. 18 

31 

Series  E-1942     ...           .      

13, 346, 934. 99 

31 

Series  E-1943...          ...        ....   

20, 804, 175. 48 

31 

Series  E-1944      .                                 

25, 615,  607. 95 

31 

Series  E-1945 

21,  915,  726.  25 

31 

Series  E-1946 

11,361,356.27 

31 

Series  E-1947    

12,365,783.72 

31 

Series  E-1948 

14, 374, 898.  21 

31 

Series  E-1949 

16, 261,  561.  57 

31 

Series  E-1950.. 

28,780,110.19 

31 
31 

Series  E-1951 

Series  E-1952  (January  to  April)   

7,946,045.05 
2, 448, 716. 76 

31 
31 

Series  E-1952  (May  to  December) 

Series  E-1953.. 

5,973,903.87 
10, 145,  536.  65 

31 

Series  E-1954 

10, 877,  597. 13 

31 

Series  E-1955 

12, 283, 998.  76 

31 

Series  E-1956 

13,115,475.30 

31 

Series  E-1957  (January) .  

1,030,932.08 

31 
31 

Series  E-1957  (February  to  December)... 
Series  E-1958. 

14, 137, 425.  52 
15, 740, 342. 62 

31 

Series  E-1959  (January  to  May) 

8,431,016.52 

Footnotes  at  end  of  table. 


590 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table    37.^ — -Issues,    maturities,    and   redemptions    of  interest-hearing    public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  2 

Amount  issued  ^ 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity « 

1961 
Jan.    31 
31 

U.S.  savings  bonds  '—Continued 

Series  E-1959  (June  to  December). _ 

Series  E-1960 

Percent 
3.750 
3.750 

$3, 039. 044.  40 
300,  782,  580. 14 

57, 994,  092.  05 
519, 861.  92 
434, 463.  44 
264, 126.  03 
131,  816.  99 

$17, 147, 167.  83 
113,407,743.46 

31 

Unclassified  sales  and  redemptions 

44,  827. 120.  52 

31 

Series  F-1949.- 

2.53 
2.53 
2.53 
2.53 

366, 095.  40 

31 

Series  F-1950 

1,251,314.42 

31 

Series  F-1951 

453, 072.  55 

31 

Series  F-1952..- 

125, 377.  42 

31 

Unclassified  sales  and  redemptions  ...  . 

4,  531,  464.  48 

31 

Series  G-1949 

2.50 
2.50 
2.50 
2.50 

2, 445,  800.  00 

31 

Series  O-1950 

2,  828, 400.  00 

31 

Series  G-1951 

1, 405,  500.  00 

31 

Series  G-1952 

271,  700.  00 

31 

Unclassified  sales  and  redemptions 

36, 348, 100.  00 

31 

Series  H-1952 . 

73.123 

^  3. 161 

73.211 

'3.258 

7  3.317 

3.360 

'  3.  626 

7  3.  679 

3.720 

3.750 

3.750 

3.750 

488, 000.  00 

31 

Series  H-1953 

1,  250, 000. 00 

31 

Series  H-1954 

2, 065,  500.  00 

31 

Series  H-1955 

2,  989,  500.  00 

31 

Series  11-1956 

2, 418, 000.  00 

31 

Series  H-1957  (January) 

92. 000.  00 

31 

Series  H-1957  (February  to  December)... 
Series  H-1958 

2, 058, 000.  00 

31 

500.  00 
8  500.  00 

2,  783, 000. 00 

31 

Series  H-1959  (January  to  May) 

1, 040,  500.  00 

31 

Series  H-1959  (June  to  December) 

Series  H-1960... 

1,267,500.00 

31 

61,908,000.00 

23, 312. 000.  00 

39,901,500.00 

82,  433.  75 

237,  767.  91 

423,  863.  25 

415,8.54.13 

346,  638.  77 

96, 748. 25 

1,  756,  500. 00 

31 

Series  H-1961 

31 

Unclassified  sales  and  redemptions... 

e  862.  500.  00 

31 

Series  J-1952..- 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

193, 380.  80 

31 

Series  J-1953 

519, 443.  60 

31 

Series  J-1954 

620, 042.  90 

31 

Series  J-1955 

597.186.40 

31 

Series  J-1956 

416, 142.  29 

31 

Series  J-1957 

43,  929.  60 

31 

Unclassified  sales  and  redemptions 

267,  255.  95 

31 

Series  K-1952 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

419.500.00 

31 

Series  K-1953 

704,  500.  00 

31 

Series  K-1954 

2, 184,  500.  00 

31 

Series  K-1955 

1,  427, 000.  00 

31 

Series  K-1956 

1, 035, 000.  00 

31 

Series  K-1957 

135, 000.  00 

31 

Unclassified  sales  and  redemptions 

916, 500. 00 

31 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  2%%  Treasury 
bonds  of  1960 

3?4 

2H 
3^4 

2yi 

3^^ 

2V, 
4.00 

4, 000. 00 

31 

Treasury  bonds  of  1960: 

Redeemed  in  exchange  for  ZH%  Treasury 
bonds  of  1966 

4, 000.  00 

31 

Treasury  bonds  of  1980: 

Issued  in  exchange  for  2yi%   Treasury 
bonds  of  1962-67  . 

8  12, 000.  00 

31 

Treasury  bonds  of  1962-67: 

Redeemed  in  exchange  for  3).4%  Treasury 
bonds  of  1980 

8  12, 000. 00 

31 

Treasury  bonds  of  1998: 

Issued  in  exchange  for  2],i%  Treasury 

bonds  of  1964-69  (Apr.  15,  1943,  issue)... 

Treasury  bonds  of  1964-69  (Apr.   15,   1943, 

issue) : 

Redeemed  in  exchange  for  3H%  Treasury 

bonds  of  1998 

8  1,  500.  00 

31 

8  1,  500.  00 

31 

Treasury  bonds  of  1969  (additional  issue) : 
Issued  in  exchange  for  Series  F  and  G 
savings  bonds 

2,747,000.00 

8, 000.  00 

198,000.00 

1,776,000.00 

Issued  for  cash. 

31 

Depositary  bonds,  First  Series 

2.00 
2.00 

2M 

883, 000. 00 

31 

Treasury  bonds,  R.E.A.  Series 

31 

Treasury  Bonds,  Investment  Series  B-1975- 
80:   Redeemed   in  exchange  for  Treasury 
notes,  Series  E  0-1965 

24, 954, 000.  00 

31 

Treasury  notes.  Series  EO-1965 

24,954,000.00 

31 

Miscellaneous 

33, 302, 800. 00 

Total  January 

8,241,008,781.26 

7, 888, 389,  955.  69 

Footnotes  at  end  of  table. 


TABLES 


591 


Table   37. —  Issues,    maturities,    and   redemptions    of  interest-bearing    public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  ^ 

Amount  issued ' 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 

1961 
Feb.     2 

Treasury  bills: 

Regular  weekly: 

Issued  Aug.  4,  1960: 

Redeemed  in  excliange  for  series 
dated  Feb.  2,  1961,  due  May  4, 
1961 

Percent 
5  2. 208 

$126, 282, 000.  00 

52,  948, 000. 00 
1,221,380,000.00 

Redeemed  in  excliange  for  series 
dated  Feb.  2,  1961,  due  Aug.  3, 
1961 

Redeemable  for  cash 

2 

Maturing  May  4,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  4,  1960 

2.299 

$126,282,000.00 
974,  591, 000. 00 

62,  948, 000. 00 
447,  440, 000. 00 

Issued  for  cash _ 

2 

Maturing  Aug.  3,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  4,  I960.- 

2.497 

Issued  for  cash 

g 

Issued  Aug.  11,  1960: 

Redeemed  in  exchange  for  series 
dated  Feb.  9, 1961,  due  May  11, 
1961 

5  2.411 

180, 137, 000. 00 
52, 489, 000. 00 

Redeemed  in  exchange  for  series 
dated  Feb.  9, 1961,  due  Aug.  10, 
1961 

Redeemable  for  cash 

1,367,777,000.00 

9 

Maturing  May  11,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  11,  1960 

2.374 

180, 137, 000.  00 
920, 036, 000. 00 

52, 489, 000.  00 
447,685,000.00 

3,669,884.000.00 
3, 654, 978, 000. 00 

Issued  for  cash. 

9 

Maturing  Aug.  10,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  11,  1960 

2,566 

15 

Treasury  notes.  Series  G-1962: 

Issued  in  exchange  for  4%%  certificates, 
Series  A-1961 

3H 

15 

Certificates  of  indebtedness.  Series  C-1961, 
regular: 
Redeemed  in  exchange  for  3U%  Treasury 
notes,  Series  Q-1962 

m 

3, 669,  884, 000.  00 

Redeemable  for  cash       -. 

3, 268, 598. 000  00 

16 

Treasury  bills: 

Regular  weekly: 

Issued  Aug.  18,  1960: 

Redeemed  in  exchange  for  series 
dated  Feb.  16,  1961,  due  May 
18,  1961                   

«  2, 623 

160,781,000.00 

Redeemed  in  exchange  for  series 
dated  Feb.  16,  1961,  due  Aug. 
17,  1961.    

51,967,000.00 

Redeemable  for  cash     

1, 388, 891, 000. 00 

16 

Matuiing  May  18,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  18,  1960 

2,462 

160,781,000.00 
940,458,000.00 

51,967.000.00 
448, 469, 000. 00 

Lssued  for  cash             ..  

16 

Maturing  Aug.  17,  1961: 

Issued    in    exchange    for    series 
dated  Aug  18,  1960 

2.652 

23 

Issued  Aug.  25,  1960: 

Redeemed  in  exchange  for  series 
dated  Feb.  23,  1961,  due  May 
25,  1961            

5  2, 524 

61,427,000.00 

Redeemed  in  exchange  for  series 
dated  Feb.  23,  1961,  due  Aug. 
24,  1961                                  

42, 567, 000.  00 

1, 499, 046, 000.  00 

23 

Maturing  May  25,  1961: 

Issued    in    exchange    for    series 
dated  Aug.  25,  1960      

2,496 

61,427,000.00 
1,039,375,000.00 

42,567,000.00 
457,578,000.00 

23 

Maturing  Aug.  24,  1961: 

Issued    in    exchange    for    series 
dated  Aug  25,  I960      

2.688 

Issued  for  cash... 

Footnotes  at  end  of  table. 


592 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — -Issues,    maturities,    and   redemptions   of  interest-bearing   'public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 


1961 
Feb.  28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 
28 


28 


28 


Security 


U.S.  savings  bonds: ' 

Series  E-1941 

Series  E-1942 - 

Series  E-1943 

Series  E-1944 

Series  E-1945 -- 

Series  E-1946 

Series  E-1947 

Series  E-1948 

Series  E-1949 

Series  E-1950 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 

Series  E-1954 

Series  E-1955 

Series  E-1950 -- 

Series  E-1957  (January) 

Series  E-1957  (February  to  December) ..  . 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (June  to  December) 

Series  E-1960 

Series  E-1961 

Unclassified  sales  and  redemptions 

Series  F-1949 

Series  F-1950 - 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  Q-1949 --- 

Series  G-1950 

Series  0-1951 

Series  0-1952 

Unclassified  sales  and  redemptions 

Series  H-1952 

Series  H-1953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-1957  (January). 

Series  H-1957  (February  to  December)... 

Series  H-195S 

Series  H-19.59  (January  to  May) 

Series  H-1959  (June  to  Derember) 

Series  H-19fiO 

Series  11-1961 

X'nclassified  sales  and  redemptions 

Series  J-1952 

Series  J-1953 - 

Series  J-19.54 -- — - 

Series  J-1955 

Series  J-1956 -- 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-195? 

Series  K  1953 

Series  K- 1954 

Series  K-1955 

Series  K:-1956 - 

Series  K-1957 

Unclassified  sales  and  redemptions 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  Wi%  certificates, 
Scries  C-1960 

Certiflcates  of  indebtedness,  Series  C-1960, 
regular: 

Redeemed    in    exchange    for    3?4% 
Treasury  bonds  of  1966 

Treasury  bonds  of  1969  (additional  issue): 
Issued  in  exchange  for  Series  F  and  G 
savings  bonds 

Treasury  bonds,  R.E.A.  Series. 

Depositary  bonds.  First  Series 


Rate  of 
interest  ^ 


Percent 

7  2. 962 

'  3. 007 

'  3. 046 

'  3. 069 

'  3. 097 

'  3. 118 

7  3. 146 

'  3. 168 

'  3.  264 

'  3. 347 

'  3. 378 

3.400 

'  3. 451 

7  3. 468 

■>  3. 497 

'  3. 522 

^  3.  546 

3.560 

7  3. 653 

^  3. 690 

3.730 

3.750 

3. 750 

3.750 


2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 


'  3. 123 

?  3. 161 

'3.211 

'  3.  258 

'  3. 317 

3.360 

?  3. 626 

7  3.  679 

3.720 

3.750 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


Wi 


AH 


4.00 
2.00 
2.00 


Amount  issued  ^ 


$712. 
4, 094, 
4, 330. 
8, 110, 
4, 027, 
3,312, 
3, 516, 
4, 046. 
4, 482, 
4, 643, 
6, 088, 
2,971, 
2,391, 
5,315, 
5,513, 
5, 734, 
5, 879, 

5, 703, 

6, 110, 

3, 109, 

2, 558, 

200, 250, 

107,341, 

9  27,811, 

475, 

235, 

178, 


574. 45 
629.  89 
443. 33 
074. 12 
546.  59 
858.  82 
581. 81 
628. 22 
695.  72 
226. 79 
649.  47 
676. 12 
030. 30 
502. 06 
385. 44 
067. 24 
418. 87 
1.5. 61 
494. 02 
712.  30 
734.  52 
455. 26 
249. 14 
950. 00 
767.  80 
089.  25 
."148.  81 
524.  50 
544. 92 


9,711,000.00 

104,167,000.00 

«  15,863,  ,500.00 

06, 274. 95 

182, 990. 80 

379, 326.  97 

281,544.40 

306, 768. 82 

87,541.25 


8  25. 000. 00 


22, 000. 00 
1, 264, 000. 00 
1, 887, 000. 00 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


$3,013. 

11,327, 

17, 380. 

22, 082, 

18. 073, 

10,271, 

11,795, 

13, 517, 

14,912. 

22, 094, 

15, 082, 

2, 122, 

4, 203, 

7,455. 

8, 007, 

9,  400, 

9. 429. 

881, 

11,142, 

19, 525, 

9, 524, 

17, 028, 

106, 992, 

12, 

7, 824, 

9, 559, 

814, 

456, 

304, 

9  4, 945, 

58, 981, 

3,  569, 

1, 886, 

518, 

9  21,656, 

479, 

1,149, 

2, 093, 

2, 091, 

2, 569, 

181, 

1,592, 

2,517, 

1,005, 

1, 140, 

1, 807, 


676. 92 
019. 99 

578. 65 
313.  52 
200.  82 
904.34 
404. 04 
050. 49 
005.  53 

910. 62 
401.16 
433.  31 
698.  40 
579.  42 
902. 00 
730. 00 

504. 69 

985. 63 
366. 09 

418. 66 
074. 32 
840.  52 
941.07 
093.  75 
162. 37 
501. 11 

040. 70 
812.  76 
782. 00 
664.  28 
700.  CO 
300. 00 
600.00 
900.00 
100.00 
000. 00 
000.00 
000. 00 
500. 00 
500.00 
500. 00 
500.00 
500. 00 
500. 00 
500.00 
000.00 


9  454. 

244, 

386. 

710, 

607. 

492, 

136, 

9  653. 

558, 

998, 

2, 385, 

1,628, 

1, 133, 

95, 

9  1, 768, 


000. 00 
250.  80 
042. 20 
805. 75 
850. 20 
641.44 
966.  55 
481. 87 
000.00 
500.00 
500.00 
500.00 
500. 00 
500. 00 
000. 00 


«  25, 000. 00 


11, 038, 000. 00 


Footnotes  at  end  of  table. 


TABLES 


593 


Table    37. — Issues,    maturities,    and   redemptions    of  interest-bearing    public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 


Security 


Rate  of 
interest  2 


Amount  issued  ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


1961 
Feb.  28 


Mar.    2 


Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed  in  exchange  for  Treasury 

notes,  Series  EO-1965 

Treasury  notes.  Series  EO-1965 

Misteellaneous 


Percent 
IH 


$26, 858, 000. 00 


$26, 858, 000. 00 


25, 423, 400. 00 


Total  February. 


14,  291, 900, 486. 96 


13, 656, 249, 729.  73 


16 


Treasury  bills: 

Regular  weekly: 

Issued  Sept.  1,  1960: 

Redeemed  in  exchange  for  series 
dated  Mar.  2,  1961,  due  June  1, 

1961 

Redeemed  in  exchange  for  series 
dated  Mar.  2, 1961,  due  Aug.  31, 

1961— 

Redeemable  for  cash 

Maturing  June  1,  1961: 

Issued    in    exchange    for   series 

dated  Sept.  1,  1960 

Issued  for  cash 

Maturing  Aug.  31,  1961: 

Issued    in    exchange    for   series 

dated  Sept.  1,  1960 

Issued  for  cash 

Issued  Sept.  8,  1960: 

Redeemed  in  exchange  for  series 
dated  Mar.  9, 1961,  due  June  8, 

1961 — . 

Redeemed  in  exchange  for  series 
dated  Mar.  9, 1961,  due  Sept.  7, 

1961- 

Redeemable  for  cash 

Maturing  June  8,  1961: 

Issued    in    exchange    for   series 

dated  Sept.  8,  1960 

Issued  for  cash 

Maturing  Sept.  7,  1961: 

Issued    in    exchange    for    series 

dated  Sept.  8,  1960 

Issued  for  cash 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  23^%  Treasury 

bonds  of  1963-- - 

Treasury  bonds  of  1963: 

Redeemed  in  exchange  for  ZW7o  Treasury 

bonds  of  1966- 

Treasury  bonds  of  1967: 

Issued  in  exchange  for  2%%  Treasury 

notes.  Series  A-1963-- 

Issued  in  exchange  for  2M%  Treasury 

bonds  of  1959-62  (dated  June  1,  1945) .  - . 

Issued  in  exchange  for  2J-4%  Treasury 

bonds  of  1959-62  (dated  Nov.  15, 1945).. 

Treasury  bonds  of  1959-62  (dated  June  1, 

1945): 

Redeemed  in  exchange  for  35^%  Treasury 

bonds  of  1967 

Treasury  bonds  of  1959-62  (dated  Nov.  15, 
1945): 
Redeemed  in  exchange  for  3^%  Treasury 

bonds  of  1967 

Treasury  notes.  Series  A-1963: 

Redeemed  in  exchange  for  3^6%  Treasury 

bonds  of  1967 

Treasury  bills: 

Regular  weekly: 

Issued  Sept.  15,  1960: 

Redeemed  in  exchange  for  series 
dated  Mar.  16,  1961,  due  June 

15,  1961... - 

Redeemed  in  exchange  for  series 
dated  Mar.  16,  1961,  due  Sept. 

14,  1961 

Redeemable  for  cash 


6  2. 494 


70, 417, 000. 00 


41, 977, 000. 00 
1, 394, 010, 000. 00 


2.594 


2.779 


70, 417, 000. 00 
930, 562, 000. 00 


41, 977, 000. 00 
458, 164, 000. 00 


«  2. 476 


85, 866, 000.  00 


41, 987, 000. 00 
1, 472, 871, 000. 00 


2.486 


2.674 


3% 


85, 866, 000. 00 
1, 006,  554, 000. 00 


41, 987, 000. 00 
458,  295, 000. 00 


2, 442,  507, 000. 00 


2, 442,  507, 000. 00 


876,  703, 000. 00 
1, 307, 940,  500. 00 
1, 420, 736, 000. 00 


2^ 

2M 
2% 

«  2.  516 


1, 307, 940,  500.  00 

1, 420, 736, 000. 00 
876, 703, 000. 00 

95, 475, 000. 00 


17, 470, 000. 00 
1, 485,  572, 000. 00 


Footnotes  at  end  of  table. 


594   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 

Security 

Rate  of 
interest  ^ 

Amount  issued  3 

Amount  matiwed 

or  called  or 

redeemed  prior 

to  maturity  * 

1961 
Mar.  16 

Treasury  bills — Continued 

Regular  weekly— Continued 
Maturing  June  15,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  15,  1960 

Percent 
2.352 

$95, 475, 000. 00 
1,  004, 461,  000.  00 

17,  470,  000. 00 
482,  534, 000. 00 

Issued  for  cash 

16 

Maturing  Sept.  14,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  15,  I960- 

2.455 

Issued  for  cash 

22 

Tax  anticipation: 

Issued  July  13,  1960: 

Redeemable  for  cash 

2.823 
5  2. 385 

$3, 511, 749, 000. 00 

141, 093, 000.  00 

52, 934, 000.  00 
1,  407,  634, 000.  00 

23 

Regular  weekly: 

Issued  Sept.  22,  1960: 

Redeemed  in  exchange  for  series 
dated  Mar.  23,  1961,  due  June 
23,  1961                             

Redeemed  in  exchange  for  series 
dated  Mar.  23,  1961,  due  Sept. 
21,  1961 

Redeemable  for  cash 

23 

Maturing  June  23,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  22,  I960-. 

2.278 

141, 093,  000. 00 
953, 836,  000.  00 

62, 934, 000.  00 
447, 143, 000.  00 

Issued  for  cash-. 

23 

Maturing  Sept.  21,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  22,  1960 

2.471 

Issued  for  cash  

30 

Issued  Sept.  29, 1960: 

Redeemed  in  exchange  for  series 
dated  Mar.  30,  1961,  due  June 
29,  1961 

«  2.  342 

118,  849, 000. 00 
41,  626,  000. 00 

Redeemed  in  exchange  for  series 
dated  Mar.  30,  1961,  due  Sept. 
28,  1961 

Redeemable  for  cash.. 

1,  340, 384, 000. 00 

30 

Maturing  June  29,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  29,  1960 

2.392 

118, 849, 000.  00 
981, 072, 000. 00 

41,  626, 000. 00 
458, 459, 000. 00 

1, 500.  00 

703. 677.  27 
4, 277,  096.  44 
10,  402, 164.  24 
3,  774. 297.  01 
3,  666, 087.  71 
3,119,584.98 
3. 455,  461.  92 
3,  713,  504.  51 
4, 238,  701.  09 
4, 469, 280. 17 
5, 908, 596. 40 
2, 829, 977.  96 
2,401,020.37 
5, 323, 660.  67 
5, 386. 824.  03 
5,  775,  6.58.  55 
5,  554, 238.  55 
8 13, 062.  84 
5,  516, 618.  64 
6, 061, 461.  66 
2,  998,  247.  27 
2,  720, 105.  51 
56, 194, 978.  83 
322, 522, 481. 25 

Issued  for  cash 

30 

Maturing  Sept.  28,  1961: 

Issued    in    exchange    for    series 
dated  Sept.  29,  I960-   

2.576 

Issued  for  cash 

31 

Treasury  bonds  of  1969  (additional  issue): 
Maturing  Oct.  1,  1969: 

Issued  in  exchange  for  Series  F  and  G 
savings  bonds.  

4.00 

7  2.  962 

7  3.  007 

'  3.  046 

7  3.  069 

7  3.  097 

'3.118 

^  3. 146 

'  3. 168 

^  3.  264 

7  3.  347 

'  3.  378 

3.400 

7  3.451 

7  3.  468 

7  3.  497 

7  3.  522 

7  3.  546 

3,  560 

7  3.  653 

7  3.  690 

3.730 

3.750 

3.750 

3.750 

31 

U.S.  savings  bonds: « 

Series  E-1941                       

4  063  672  32 

31 

Series  E-1942 

16,203,418  16 

31 

Series  E-1943 

24, 943,  034.  34 

31 

Series  E-1944 

31,628  495  39 

31 

Series  E-1945 

25,  709,  800.  34 

31 

Series  E-1946                                  .    . 

13  829  038  08 

31 

Series  E-1947 

15,028,890.88 

31 

Series  E-1948 

17,571,664.16 

31 

Series  E-1949 

19,859,975  88 

31 

Series  E-1950 

25, 224,  574.  67 
21,929,717  55 

31 

Series  E-1951                       

31 

Series  E-1952  (January  to  April) 

3,311,751.83 

31 
31 

Series  E-1952  (May  to  December) 

Series  E-1953 

6,  790, 665.  97 
12,125,362  47 

31 

Series  E-1954 

13,363,622.11 

31 
31 

Series  E-1955.. 

Series  E-1956 

15, 028, 176.  09 
15,604,240.91 

31 

Series  E-1957  (January) 

1,512  972  48 

31 
31 
31 

Series  E-1957  (February  to  December).  _. 

Series  E-1958 

Series  E-1959  (January  to  May) 

17,251,267.79 
21,361,239.44 
10, 230,  8.53.  63 

31 
31 

Series  E-1959  (June  to  December) 

Series  E-1960. 

17,  727, 025.  60 
124,  787, 602.  62 

31 

Series  E-1961 

3,719,925.00 

Footnotes  at  end  of  table. 


TABLES 


595 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-hearing   -public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Security 


Rate  of 
interest  ^ 


Amount  issued  3 


Amoimt  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


U.S.  savings  bonds  ' — Continued 

Unclassified  sales  and  redemptions  . 

Series  F-1949 

Series  F-1950 - 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions. 

Series  G-1949 

Series  O-1950 

Series  G-1951 

Series  G-1952 

Unclassified  sales  and  redemptions  . 
Series  H-1952. 


Percent 


2.53 
2.53 
2.53 
2.53 


I  $20, 870, 145. 36 

246, 083.  76 

290, 839. 81 

153, 651.  94 

70, 993.  60 


2.50 
2.50 
2.50 
2.50 


Series  H-1953 

Series  H-1954 

Series  H-1955,- 

Series  H-1956 

Series  H-1957  (January) 

Series  H-1957  (February  to  December).., 

Series  H-1958  

Series  H-1959  (January  to  May) 

Series  H-1959  (June  to  December) 

Series  H-1960-.. - 

Series  H-1961 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J-1953 

Series  J-1954 

Series  J-1955 

Series  J-1956 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-1952 

Series  K-1953 

Series  K-1954-.- 

Series  K-1955. 

Series  K-1956- 

Series  K-1957-.. 

Unclassified  sales  and  redemptions 

Depositary  bonds,  First  Series 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed   in  exchange  for  Treasury 

notes,  Series  EO-1965 

Treasury  notes,  Series  EO-1965 

Miscellaneous 


'  3. 123 

7  3. 161 

7  3.211 

1  3.  258 

7  3.317 

3.360 

7  3.  626 

7  3. 679 

3.720 

3.750 

3.750 

3.750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


866,  500. 00 

109, 905, 000. 00 

»  7, 065, 000.  00 

84, 465. 85 

214,  556.  65 

352, 144.  96 

355, 454.  70 

244, 301.  57 

72, 505. 75 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.00 
2.00 


2% 


2, 163, 000.  00 
1, 437, 000. 00 


9  $66, 677, 

19, 708, 

289, 

255, 

117, 

» 14, 145. 

179, 798, 

2, 055, 

1, 639, 

358, 

» 145,  216, 

430, 

1, 030, 

1,913, 

2, 618, 

2, 282, 

209, 

1, 630, 

2,  722, 

891, 

1, 086, 

2, 018, 

78, 

4, 895, 

204, 

185, 

672, 

482, 

322, 

161, 

641, 

253, 

1, 109, 

1, 324, 

1,112, 

1, 152, 

88, 

1, 425, 

7,  765, 

50, 


782.  72 
623. 08 
754. 96 
075. 19 
685.  75 
319.  57 
800.  00 
300.  00 
700. 00 
800. 00 
600.  00 
500. 00 
000. 00 
500. 00 
500. 00 
500. 00 
500. 00 
000. 00 
500. 00 
500. 00 
000. 00 
500.  00 
000. 00 
500. 00 
408.  65 
017.  75 
030.  07 
738. 10 
910.  40 
387.  70 
769.  83 
500. 00 
000. 00 
000.  00 
000. 00 
500.  00 
500. 00 
500.  00 
000.  00 
000.  00 


49, 210, 000. 00 


49,  210, 000. 00 


37,  777, 100. 00 


Total  March. 


14, 545, 394, 015.  42 


17.950,535,386.90 


Treasury  notes,  Series  EA-1961: 

Redeemable  for  cash 

Treasury  bills: 

Tax  anticipation: 

Maturing  Sept.  22,  1961: 

Issued  for  cash 

Regular  weekly: 

Issued  Oct.  6,  1960: 

Redeemed  in  exchange  for  series 
dated  Apr.  6,  1961,  due  July  6, 

1961 

Redeemed  in  exchange  for  series 
dated  Apr.  6,  1961,  due  Oct.  5, 

1961 

Redeemable  for  cash 

Maturing  July  6,  1961: 

Issued    in    exchange    for    series 

dated  Oct.  6,  1960 

Issued  for  cash 

Maturmg  Oct.  5,  1961: 

Issued    in    exchange    for    series 

dated  Oct.  6, 1960 

Issued  for  cash 


IH 


2.473 


144, 033. 000. 00 


1, 502, 900, 000. 00 


108, 861, 000. 00 


43, 265, 000. 00 
1, 348, 887, 000. 00 


2.658 


108,861,000.00 
991, 235, 000. 00 


43, 265, 000. 00 
456, 870, 000. 00 


Footnotes  at  end  of  table. 


596   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  2 

Amount  issued  3 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 

1961 
Apr.  13 

Tresisury  bills— Continued 

Regular  weekly— Continued 
Issued  Oct.  13,  1960: 

Redeemed  in  exchange  for  series 
dated  Apr.  13,  1961,  due  July 
13,  1961 

Percent 
»  2.  616 

$83, 003, 000. 00 
42,  936, 000  00 

Redeemed  in  exchange  for  series 
dated  Apr.  13, 1961,  due  Oct.  13, 
1961 

Redeemable  for  cash 

1,374,982,000.00 

13 

Maturing  July  13,  1961: 

Issued    in    exchange    for    series 

dated  Oct.  13,  1960 

Issued  for  cash 

2,361 

$83, 003, 000. 00 
1,017,812,000.00 

42,936,000.00 
457, 439, 000. 00 

13 

Maturing  Oct.  13,  1961: 

Issued    in    exchange    for    series 
dated  Oct.  13,  1960 

2.556 

Issued  for  cash 

15 

Other: 

Issued  Apr.  15,  1960: 

Redeemed  in  exchange  for  series 
dated  Apr.  15,  1961 

4.608 

185, 991, 000. 00 

Redeemable  for  cash. _. 

1, 814,  789, 000. 00 

15 

Maturing  Apr.  15,  1962: 

Issued    in    exchange    for    series 
dated  Apr.  15,  1960 

2.827 

185,991,000.00 
1,814,471,000.00 

Issued  for  cash    

20 

Regular  weekly: 

Issued  Oct.  20,  1960: 

Redeemed  in  exchange  for  series 
dated  Apr.  20,  1961,  due  July 
20,  1961. 

'  2. 477 

68, 316, 000. 00 

Redeemed  in  exchange  for  series 
dated  Apr.  20,  1961,  due  Oct. 
19,  1961... 

21,960,000.00 

Redeemable  for  cash 

1,411,332,000.00 

20 

Maturing  July  20,  1961: 

Issued    in    exchange    for    series 
dated  Oct.  20,  1960 

2.292 

68,316,000.00 
1,032,025,000.00 

21,960,000.00 
378,330,000.00 

Issued  for  cash  - 

20 

Matiu-ing  Oct.  19, 1961: 

Issued    in    exchange    for    series 
dated  Oct.  20,  1960 

2.457 

Issued  for  cash 

27 

Issued  Oct.  27,  1960: 

Redeemed  in  exchange  for  series 
dated  Apr.  27,  1961,  due  July 
27,  1961 ... 

5  2.  320 

109,  206, 000. 00 

Redeemed  in  exchange  for  series 
dated  Apr.  27,  1961,  due  Oct. 
26,  1961.... 

32,  233, 000. 00 

Redeemable  for  cash 

1,359,126,000.00 

27 

Maturing  July  27,  1961: 

Issued    in    exchange    for    series 
dated  Oct.  27,  1960 

2.185 

109, 206, 000.  00 
991,561,000.00 

32,233,000.00 
367,  882, 000. 00 

10, 000.  00 

27 

Maturing  Oct.  26,  1961: 

Issued    in    exchange    for    series 
dated  Oct  27,  1960 

2.300 

Issued  for  cash 

30 

Treasury  bonds  of  1980: 

Issued  in  exchange  for  2H%  Treasury 
bonds  of  1962-67 

m 

2H 

30 

Treasury  bonds  of  1962-67: 

Rodp(>mcd  in  exchange  for  3H%  Treasury 
bonds  of  1980 

10, 000. 00 

30 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  2H%  Treasury 
bonds  of  1963 

s  4, 800,  500. 00 

30 

Treasury  bonds  of  1963: 

Redeemed  in  exchange  for  ZW7o  Treasury 
bonds  of  1966 

8  4, 800, 500.  00 

Footnotes  at  end  of  table. 


TABLES 


597 


Table   37. — Issues,    viaturities,    and   redemptions   of  interest-hearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Security 


Rate  of 
interest  2 


Amount  issued  ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  « 


Treasury  bonds  of  1967: 

Issued  in  exchange  for  254%  Treasury 

bonds  of  1959-62  (dated  June  1,  1945) . . . 
Issued  in  exchange  for  2H%  Treasury 

bonds  of  1959-62  (dated  Nov.  15,  1945).. 
Issued  in  exchange  for  2^^%  Treasury 

bonds  of  1965-70 

Issued  in  exchange  for  Treasury  notes, 

Series  A-1963 

Treasury  notes.  Series,  A-1963: 

Redeemed  in  exchange  for  35i%  Treasury 

bonds  of  1967 

Treasury  bonds  of  1959-62  (dated  June  15, 
1945): 
Redeemed  in  exchange  for  ZW7o  Treasury 

bonds  of  1967 

Treasury  bonds  of  1959-62  (dated  Nov.  15, 
1945): 
Redeemed  in  exchange  for  Z%%  Treasury 

bonds  of  1967 

Treasury  bonds  of  1965-70: 

Redeemed  in  exchange  for  ZW7o  Treasury 

bonds  of  1967 

U.S.  savings  bonds: « 

Series  E-1941 

Series  E-1942 

Series  E-1943 -- 

Series  E-1944 - - — . 

Series  E-1945 

Series  E-1946 

Series  E-1947 

Series  E-1948 

Series  E-1949 

Series  E-1950 

Series  E-1951 

Series  E-1952  (January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 

Series  E-1954 

Series  E-1955.- 

Series  E-1956 

Series  E-1957  (January) 

Series  E-1957  (February  to  December)... 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (June  to  December) 

Series  E-1960 

Series  E-1961 

Unclassified  sales  and  redemptions 

Series  F-1949.. 

Series  F-1950 

Series  F-1951 

Series  F-1952 

Unclassified  sales  and  redemptions 

Series  G-1949 

Series  G-1950 

Series  G-1951 

Series  G-1952 

Unclassified  sales  and  redemptions 


Series  H-1952. 

Series  H-1953 

Series  H-1954 

Series  H-1955 

Series  H-1956 

Series  H-1957  (January) 

Series  H-1957  (February  to  December). 

Series  H-1958 

Series  H-1959  (January  to  May) _.. 

Series  H-1959  (June  to  December) 

Series  H-1960 

Series  H-1961 

Unclassified  sales  and  redemptions 

Series  J-1952 

Series  J-1953 

Series  J-1954 


Percent 
35^ 


2% 


2H 


214 


2^ 

7  2. 962 

'  3. 007 

^  3. 046 

7  3. 069 

^  3. 097 

^  3. 118 

^  3. 146 

7  3. 168 

'3.264 

7  3. 347 

1  3. 378 

3.400 

^  3. 451 

^  3. 468 

^  3.  497 

7  3.  522 

7  3.546 

3.560 

'  3. 653 

1  3.  690 

3.730 

3.750 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 


^  3. 123 

7  3. 161 

7  3. 211 

7  3. 258 

7  3. 317 

3.360 

7  3. 626 

7  3. 679 

3.720 

3.750 

3.750 

3.750 


I  $18,  763, 200. 00 

1  232, 466, 800. 00 

8  4, 466,  500. 00 

253, 928, 000. 00 


801, 
4,  449, 
8, 076, 
3, 423, 
4, 491, 
3, 196, 
3, 274, 
3,  578, 
3,923, 
4, 096, 
6, 970, 
2,549, 
2,  503, 
5, 366, 
5, 116, 
5, 565, 
5, 497, 

5,645, 

6, 090, 

2, 909, 

3, 206, 

16,611, 

297, 244, 

9  19, 977, 

273, 

1,223, 

185, 

59, 


536. 33 
279. 32 
522.  93 
564.29 
875.  07 
017.  87 
862.  27 
109.  22 
944.  65 
070.  79 
158.  50 
877. 96 
724.  78 
568.  27 
428. 13 
451. 11 
856. 37 
8  25.  22 
131.  96 
904. 80 
376.  37 
863. 40 
806. 83 
987.  50 
295. 23 
463.  78 
783.  91 
885.14 
040. 45 


2.76 
2.76 
2.76 


26, 000. 00 

88,  588, 500. 00 

6  13,934,000.00 

97, 201.  30 

190, 973. 30 

351, 991. 77 


$253, 928, 000. 00 


8 18, 763, 200. 00 


8  232, 466, 800.  00 


8  4, 466, 500. 00 


3, 110, 
13, 058, 
20, 620, 
24, 805, 
20, 123, 
11,099, 
12, 183, 
13, 648, 
15, 003, 
18,  733, 
18,  558, 
2, 733, 
5,  533, 
10, 541, 

11,  245, 
14, 893, 

12,  779, 
1,164, 

14, 173, 

17, 881, 

8, 893, 

15, 386, 

77, 927, 

33, 321, 

9  27, 825, 

7, 098, 

409, 

628, 

58, 

»  2,  658, 

40, 979, 

2,764, 

1,427, 

569, 

9 10, 892, 

503, 

1,171 

2, 290, 

3, 727, 

2, 914, 

387, 

1, 898, 

3,117, 

1,411, 

1, 392, 

2, 872, 

85, 

9  3, 807, 

328, 

289, 

590, 


310.24 

992. 39 
368.  04 
665.  23 
576. 18 
043. 14 
703. 99 
000. 12 
388.91 
987.  72 
112.21 
429.  33 
382. 17 
901. 22 
582.  45 
832.  65 
263. 89 
000. 11 
872.23 

569. 40 
728.24 
276. 93 
302.  73 
975. 00 
434. 83 
121.  50 
636.54 
360.23 
698.  67 
415. 99 
100. 00 
800. 00 
600. 00 
700. 00 
200. 00 
500. 00 
000. 00 
000. 00 
500. 00 
500. 00 
000, 00 
000. 00 
000. 00 
000. 00 
500. 00 
500. 00 
500. 00 
000. 00 
224. 45 
312.85 
672.94 


Footnotes  at  end  of  table. 


598 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 

Security 

Rate  of 
interest  2 

Amount  issued  3 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 

1961 
Apr.  30 

U.S.  savings  bonds  *— Continued 

Series  J-1955. 

Percevt 
2.76 
2.76 
2.76 

$350, 822. 10 

181,  577.  41 

8  54.25 

$847, 046.  50 

30 

Series  J-1956                           .             ... 

418  295  36 

30 

Series  J-1957 

163  830  35 

30 

Unclassified  sales  and  redemptions.  

9  233,  620.  66 

30 

Series  K-1952 .     .. 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

534  500  00 

30 

Series  K-1953 

734, 000. 00 

30 

Series  K-1954. 

1, 988,  500.  00 

30 

Scries  K-1955..-. 

1  717  000  00 

30 

Series  K-1956... 

981,000.00 

30 

Series  K-1957 

256,  500. 00 

30 

Unclassified  sales  and  redemptions 

s  344, 000. 00 

30 

Depositary  bonds,  First  Series  .  .  .      . 

2.00 
2.00 

234 

m 
m 

2, 027, 000.  00 
961, 000.  00 

2, 602, 000. 00 

30 

Treasury  lionds,  R.E.A.  Series 

Treasui-y  lionds,  Investment  Series  B-1975-80: 
Redeemed  in  exchange  for  Treasury  notes, 
Series  EO-1965 

30 

79,  545, 000. 00 

30 

Treasury  notes,  Series  EO-1965 

Treasury  Bonds,  Investment  Series  B-1975-80: 
Redeemed  in  exchange  for  Treasury  notes, 
Series  EA-1966 

79,  545, 000. 00 

30 

3  493,000  00 

30 

Treasury  notes,  Series  EO-1966 

3, 493, 000. 00 

30 

Miscellaneous 

21,  510,  700. 00 

Total  April 

10,  246, 971,  783. 18 

8, 685, 727, 192. 43 

Treasury  bills: 

Regular  weekly: 

Issued  Nov.  3,  1960: 

Redeemed  in  exchange  for  series 
dated  May  4,  1961,  due  Aug.  3, 

1961 

Redeemed  in  exchange  for  series 
dated  May  4,  1961,  due  Nov.  2, 
1961 

'  2.  340 

May  4 

153,832,000.00 

55, 460, 000. 00 

Redeemable  for  cash      .      . 

1,291,721  000  00 

4 

Maturing  Aug.  3,  1961: 

Issued  in  exchange  for  series  dated 
Nov.  3,  1960... 

2.299 

153,832,000.00 
946,820,000.00 

55, 460, 000. 00 
444, 792, 000. 00 

Issued  for  cash .  

4 

Maturing  Nov.  2,  1961: 

Issued  in  exchange  for  series  dated 

Nov.  3,  1%0 

Issued  for  cash 

2.417 

11 

Issued  Nov.  10,  1960: 

Redeemed  in  exchange  for  series 
dated  May  11,  1961,  due  Aug. 
10,  1961 

5  2.  427 

180, 758, 000. 00 

Redeemed  in  exchange  for  series 
dated  May  11, 1961,  due  Nov.  9, 
1961 

51,906,000.00 

Redeemable  for  cash 

1,267,715,000.00 

11 

Maturing  Aug.  10,  1961: 

Issued  in  exchange  for  series  dated 
Nov.  10,  1960. 

2.232 

180, 758, 000. 00 
919,831,000.00 

51, 906, 000. 00 
448, 460, 000. 00 

21,  506, 000. 00 

828,621,000.00 
1, 903,  706, 000. 00 

1,727,147,000.00 

53, 999, 000. 00 
3, 728, 098, 000. 00 

Issued  for  cash 

11 

Maturing  Nov.  9,  1961: 

Issued  in  exchange  for  series  dated 
Nov.  10,  1960 - 

2.423 

Issued  for  cash 

15 

Treasury  notes,  Series  D-1963: 

Issued  in  exchange  for  35^%  Treasury 
notes.  Series  B-1961 

3H 

Issued  in  exchange  for  4?i%  certificates. 
Series  B-1961 

Issued  for  cash 

15 

Certificates  of  indebtedness.  Series  A-1962: 
Issued  in  exchange  for  3?-i%  Treasury 
notes.  Series  B-1961 

3.00 

Issued  in  exchange  for  4M%  certificates. 
Series  B-1961_.. 

Issued  for  cash 

I 


Footnotes  at  end  of  table. 


TABLES 


599 


Table   37. —  Issues,    maturities,    and  redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issuse,  July  1960-June  1961  ^ — Continued 


Security 


Rate  of 
interest  2 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  < 


Treasury  notes,  Series  B-1961: 

Redeemed  in  exchange  for  3H%  Treasury 

notes,  Series  D-1963 

Redeemed  in  exchange  for  3%  certificates, 

Series  A-1962 

Redeemable  for  cash 

Certificates  of  indebtedness.  Series  B-1961: 
Redeemed  in  exchange  for  Z\i%  Treasury 

notes.  Series  D-1963 

Redeemed  in  exchange  for  3%  certificates, 

Series  A-1962 

Redeemable  for  cash 

Treasury  bills: 

Regular  weekly: 

Issued  Nov.  17,  1960: 

Redeemed  in  exchange  for  series 
dated  May  18,  1961,  due  Aug. 

17,  1961 

Redeemed  in  exchange  for  series 
dated  May  18,  1961,  due  Nov. 

16,  1961 

Redeemable  for  cash 

Maturing  Aug.  17,  1961: 

Issued  in  exchange  for  series  dated 

Nov.  17,  1960 

Issued  for  cash 

Maturing  Nov.  10,  1961: 

Issued  in  exchange  for  series  dated 

Nov.  17,  1960 

Issued  for  cash 

Issued  Nov.  25,  1960: 

Redeemed  in  exchange  for  series 
dated  May  25,  1961,  due  Aug. 

24,  1961.- 

Redeemed  in  exchanee  for  series 
dated  May  25,  1961,  due  Nov. 

24,  1961 

Redeemable  for  cash 

Maturing  Aug.  24,  1961: 

Issued  in  exchange  for  series  dated 

Nov.  25,  1960 

Issued  for  cash 

Maturing  Nov.  24,  1961: 

Issued  in  exchange  for  series  dated 

Nov.  25,  1960 

Issued  for  cash 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  2],i%  Treasury 

bonds  of  1963 

Treasury  bonds  of  1963: 

Redeemed  in  exchange  for  Z%%  Treasury 

bonds  of  1966 

Treasury  bonds  of  1998: 

Issued  in  exchange  for  2\¥7o  Treasury 

bonds  of  1962-67 

Treasury  bonds  of  1964-69  (dated  Sept.  15, 
1943): 
Redeemed  in  exchange  for3J4%  Treasury 

bonds  of  1998 

Treasury  bonds  of  1967: 

Issued  in  exchange  for  23.4%  Treasury 

bonds  of  1959-62  (dated  June  15, 1945).— 

Issued  in  exchange  for  2>4%  Treasury 

bonds  of  1959-62  (dated  Nov.  15, 1945)  „. 

Treasury  bonds  of  1959-62  (dated  June  15, 

1945); 

Redeemed  in  exchange  for  35^%  Treasury 

bonds  of  1967 

Treasury  bonds  of  1959-62  (dated  Nov.  15, 
1945) : 
Redeemed  in  exchange  for  35^%  Treasury 
bonds  of  1967.- 


Percent 


4?i 


6  2.  575 


$21, 506, 000. 00 


1,  727, 147, 000. 00 
2, 329,  720, 000. 00 


828,621,000.00 


53, 999, 000.  00 
2, 791,  752, 000.  00 


170, 482, 000. 00 


52, 026, 000. 00 
1, 378, 706, 000. 00 


2.264 


2.435 


$170, 482, 000. 00 
929,  536, 000. 00 


52, 026, 000.  00 
448, 702, 000. 00 


66, 105, 000. 00 


32,510.000.00 
1,503,981,000.00 


2.354 


2.470 


3% 

3 1-2 

3?S 


66, 105, 000. 00 
1,034,247,000.00 


32, 510, 000. 00. 
467,641,000.00 


8  65,000.00 


8  65,000.00 


2,000.00 


2, 000, 00 


47, 500. 00 
8  110,000.00 


2W 


214 


9, 217, 200. 00 


'  9, 973, 700. 00 


Footnotes  at  end  of  table. 


600 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960~June  1961  ' — Continued 


Date 


Security 


Rate  of 
interest  2 


Amount  issued  3 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


1961 
May  31 


Treasury  notes.  Series  A-1963: 

Redeemed  in  exchange  for  3H%  Treasury 

bonds  of  1967 

U.S.  savings  bonds:' 

Series  F;-1941 

Series  E-1942 

Series  E-1943 

Series  E-1944 

Series  E-1945 

Series  E-1946 

Series  E-1947 

Series  E-1948 

Series  E-1949 _ 

Series  E-1950 

Series  E-1951 

Series  E-]9.';2  (.January  to  April) 

Series  E-1952  (May  to  December) 

Series  E-1953 

Series  E-1954 

Series  E-1955 

Series  E-1956 

Series  E-1957  (January) 

Series  E-1957  (February  to  December)... 

Series  E-1958 

Series  E-1959  (January  to  May) 

Series  E-1959  (Jime  to  December) 

Series  E-19fi0 -.. 

Series  E-1901 

Unclassified  sales  and  redemptions 

Series  F-1949 

Scries  F-1950 

Series  F-1951 - 

Series  F-1952 

Unrlas.sifled  sales  and  redemptions 

Series  G-1949 

Series  G-1950 --. 

Series  G-1951 

Series  G  1952 

Unclassified  sales  and  redemptions 

Series  n-1952_ 

Series  11-1953 

Series  H  1954 

Series  H-1955 

Series  11-1956 

Series  11-1957  (January) 

Series  H-1957(February  to  December) 

Scries  11-1958 

Series  11-1959  (January  to  May) 

Series  11-19.59  (June  to  December) 

Series  11-1960 

Series  11-1961 

Unclassified  sales  and  redemptions 

Series  J- 1952 

Series  J-1953 

Series  J-1954 

Series  J-1955 

Series  J-1956 .-- - 

Series  J-1957 

Unclassified  sales  and  redemptions 

Series  K-1952 

Series  K-1953 

Series  K-1954 

Series  K-1955 - 

Series  K-1956 

Series  K-1957 

Unclassified  sales  and  redemptions __ 

Depositary  bonds,  First  Series 

Treasury  bonds,  R.E.A.  Series 

Treasury  Bonds,  Investment  Series  B-1975- 
80:  Redeemed   in  exchange   for  Treasury 

notes.  Scries  E.'V-1966 

Treasury  notes,  Series  EA-1966 

Miscellaneous 


Percent 


2H 

^  3.  223 

7  3. 252 

'  3. 276 

'  3. 298 

'3.316 

'  3. 327 

'  3. 346 

'  3. 366 

'  3. 344 

7  3. 347 

'  3. 378 

3.400 

'  3. 451 

7  3. 468 

^  3.  497 

?  3.  522 

'  3.  546 

3.  560 

7  3.  653 

7  3.  690 

3.730 

3.750 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 


2.50 
2.50 
2.50 
2.50 


'  3, 123 

7  3. 161 

'3.211 

'  3. 258 

»  3. 317 

3.360 

'  3. 626 

'  3. 679 

3.720 

3.750 

3.750 

3. 750 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.76 
2.76 
2.76 
2.76 
2.76 
2.76 


2.00 
2.00 


2-4 


$1,505, 
4, 173, 

4,  228, 

5,  906, 
10, 972, 

3, 184, 

3, 002, 

3,  591, 

3, 896, 

3, 986, 

5,603, 

8  12, 

4, 610, 

4, 979, 

4,990, 

5,341, 

5, 340, 

1, 

5,921, 

5, 766, 

2, 779, 

2, 958, 

5, 457, 

353, 973, 

»  47, 346, 

281, 

426, 

160. 


079,  51 
046, 62 
077. 14 
614.  .59 
445. 09 
580.  53 
587. 13 
816.  74 
523. 03 
898. 67 
984. 54 
823.  65 
965.  70 
860. 30 
927. 91 
663. 00 
666.  75 
209. 38 
867.  91 
205. 80 
951.31 
592.  56 
359. 41 
468.  75 
681.  91 
857. 65 
232.  50 
120. 20 
8  57.  54 


1,500.00 

75, 260,  .500.  00 

3, 979,  500. 00 

209, 473.  95 

211,460.90 

392, 210.  46 

300, 706.  50 

183, 833.  84 

8  278.  50 


774, 000. 00 
2, 019, 000. 00 


52, 734, 000. 00 


$694, 000. 00 


1,744, 
7, 889, 
13, 034, 
14,816, 
12. 490, 
6, 864, 
7, 830, 
8, 705, 

9. 844, 
11,857, 
13, 468, 

1,902, 

3,  662, 

6, 904, 

7,  523, 

9, 856, 

8, 732, 

725, 

11, 139, 

20, 073, 

9, 934, 

16, 570, 

71,298, 

63, 287, 

27, 513, 

5, 154, 

286, 

343, 

54. 

3. 845, 
26, 273, 

2,971, 

1, 512, 

501, 

6, 504, 

391, 

1,027, 

2, 233, 

2, 800, 

2, 282. 

153, 

1.612, 

2, 675, 

992, 

1,095, 

2, 584, 

92, 

2, 681, 

135, 

335, 

753, 

499, 

327. 

172, 

642, 

621, 

597, 

2, 307, 

1, 232. 

1,037, 

208, 

643. 

1, 934, 


739. 02 
762.  03 
430. 22 
471. 65 
156. 35 
499. 72 
907. 39 
295.  75 
816.  35 
816.01 
935.  85 
825.  98 
666.  72 
406.  75 
032.  79 
393.  71 
991.65 
490.64 
105. 80 
795.44 
896. 71 
109.  55 
029. 00 
812.50 
365. 44 
267. 20 
741.95 
735. 80 
855.  00 
693.  63 
500. 00 
700.00 
500.00 
400. 00 
500. 00 
500.00 
500. 00 
500.00 
500. 00 
500. 00 
000. 00 
500.00 
500. 00 
500. 00 
000. 00 
000.00 
500.00 
000. 00 
290. 35 
705. 10 
835.77 
429.  80 
130.  82 
657. 65 
993. 29 
000. 00 
500.  00 
500.00 
500.00 
000.  00 
000. 00 
000.00 
500. 00 


52,  734, 000. 00 
'26,"389,"96o."o6 


Total  May. 


15,  207, 814, 446. 77 


14,  484, 136,  589. 38 


Footnotes  at  end  of  table. 


TABLES 


601 


Taple    37. — Issues,    maturities,    and    redemptions    of  interest-bearing  public  debt 
securities,  excluding  special  issues,  July  1960- June  1961  ' — Continued 


Date 

Security 

Rate  of 
interest  2 

Amoimt  issued  a 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity « 

1961 
June    1 

Treasury  bills: 

Eegular  weekly: 

Issued  Dec.  1, 1960: 

Redeemed  in  exchange  for  series 
dated  June  1, 1961,  due  Aug.  31, 
1961 - 

Percent 
5  2.  610 

$78,  691, 000. 00 

41, 676, 000. 00 
1,380,823,000.00 

Redeemed  in  exchange  for  series 
dated  June  1,  1961,  due  Nov. 
30,  1961 

Redeemable  for  cash 

1 

Maturing  Aug.  31,  1961: 

Issued    in    exchange    for   series 
dated  Dec.  1, 1960 

2.437 

$78,691,000.00 
922, 238, 000. 00 

41,676,000.00 
458,  592, 000. 00 

Issued  for  cash 

1 

Maturing  Nov.  30,  1961: 

Issued    in    exchange    for   series 
dated  Dec.  1, 1960 

2,593 

Issued  for  cash... 

8 

Issued  Dec.  8, 1960: 

Redeemed  in  exchange  for  series 
dated  June  8, 1961,  due  Sept.  7, 
1961 

5  2,  541 

118,376,000.00 
52, 064, 000. 00 

Redeemed  in  exchange  for  series 
dated  June  8,  1961,  due  Dec.  7, 
1961 

Redeemable  for  cash 

1, 422,  215, 000. 00 

8 

Maturing  Sept.  7,  1961: 

Issued    in    exchange    for    series 
dated  Dec.  8, 1960 

2.516 

118,376,000.00 
982, 259, 000. 00 

52,064,000.00 
448,  290, 000. 00 

1,801,872,000.00 

Issued  for  cash.  

8 

Maturing  Dec.  7, 1961: 

Issued    in    exchange    for   series 
dated  Dec.  8,  1960 

2,727 

Issued  for  cash 

14 

Maturing  Aug.  3-Nov.  30,  1961:  "> 
Issued  for  cash 

2.308 
5  2. 437 

15 

Issued  Dec.  15,  1960: 

Redeemed  in  exchange  for  series 
dated  June  15,  1961,  due  Sept. 
14,  1961 

50,  585, 000. 00 

Redeemed  in  exchange  for  series 
dated  June  15,  1961,  due  Dec. 
14,  1961 

2, 406, 000.  00 

Redeemable  for  cash 

1,  648,  263, 000. 00 

15 

Maturing  Sept.  14,  1961: 

Issued    in    exchange    for   series 
dated  Dec.  15, 1960 

2.295 

50,  585, 000. 00 
1,050,019,000.00 

2,406,000.00 
497, 962, 000. 00 

Issued  for  cash 

15 

Maturing  Dec.  14,  1961: 

Issued    in    exchange    for   series 
dated  Dec.  15, 1960 

2.492 

22 

Tax  anticipation: 

Issued  Oct.  21,  1960: 

Redeemable  for  cash  .        .    

2.788 
5  2.  314 

3, 503, 706, 000. 00 

23 

Regular  weekly: 

Issued  Dec.  22,  1960: 

Redeemed  in  exchange  for  series 
dated  June  23,  1961,  due  Sept. 
21,  1961                           -          .  . 

99, 437, 000. 00 

Redeemed  in  exchange  for  series 
dated  June  23,  1961,  due  Dec. 
21,1961 

52, 495, 000. 00 

Redeemable  for  cash 

1, 443, 148, 000. 00 

23 

Maturing  Sept.  21,  1961: 

Issued    in    exchange    for    series 
dated  Dec  22  1960 

2.325 

99,4.37,000.00 
1,001,619,000.00 

52, 495, 000. 00 
448,  272, 000. 00 

Issued  for  cash 

23 

Maturing  Dec.  21,  1961: 

Issued    in    exchange    for   series 
dated  Dec  22  1960 

2.519 

Issued  for  cash 

Footnotes  at  end  of  table. 


602 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Taple   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issves,  July  1960-June  1961  ' — Continued 


Date 


Security 


Rate  of 
interest  ^ 


Amount  issued ' 


Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  * 


1961 
June  29 


Treasury  bills — Continued 

Kegular  weekly— Continued 
Issued  Dec.  29,  19G0: 

Redeemed  in  exchange  for  series 
dated  June  29,  1961,  due  Sept. 

28,  1961 

Redeemed  in  exchange  for  series 
dated  June  29,  1961,  due  Dec. 

28,  1961- 

Redeemable  for  cash 

Maturing  Sept.  28,  19G1: 

Issued    in    exchange    for    series 

dated  Dec.  29,  1960 

Issued  for  cash. 

Maturing  Dec.  28,  1961: 

Issued    in    exchange    for    series 

dated  Dec.  29,  I960- 

Issued  for  cash 

Treasury  bonds  of  1966: 

Issued  in  exchange  for  2^%  Treasury 

bonds  of  1963 

Treasury  bonds  of  1963: 

Redeemed  in  exchange  for  ZH%  Treasury 

bonds  of  1966 -. 

Treasury  notes,  Series  D-1963: 

Cancellation  of  allotments  (cash  issues)  ". 
Treasury  certificates  of  indebtedness.  Series 
A-1962: 
Cancellation  of  allotments  (cash  issues)  u. 
U.S.  savings  bonds: « 


Percent 
« 2.  374 


es  P:-1941- 

es  E-1942 

es  E-1943 -. 

es  E-1944 

es  E-1945- 

es  E-1946- -. 

es  E-1947- — 

es  E-1948 

es  E-1949 

es  E-1950 

es  E-1951 

es  E-1952  (January  to  April) 

es  E-1952  (May  to  December) 

es  E-1953.— 

es  E-1954 - -.-. 

es  E-1955- 

es  E-1956— - 

es  E-1957  (January) 

es  E-1957  (February  to  December). 

es  E-1958 

es  E-1959  (Januaiy  to  May) 

es  E-1959  (June  to  December) 

es  E-1960- -. 

es  E-1961- -- 


es  F-1949. 
es  F-1950- 
es  F-1951. 
es  F-1952- 


Ser: 

Ser: 

Ser 

Ser 

Unclassified  sales  and  redemptions. 

Ser       ■     "  " 

Ser, 

Ser 

Ser 


es  G-1949- 

s  0-1950- 

es  a-1951- 

es  a-1952- 


2.399 


3% 
2^ 

3.00 

'  3.  223 

'  3.  252 

'  3.  276 

'  3.  298 

7  3.316 

'  3.  327 

7  3.  346 

'  3.  366 

'  3.  344 

?  3.  347 

7  3.  378 

3.400 

'  3.  451 

7  3.  468 

^  3.  497 

7  3.  522 

7  3.  546 

3.560 

7  3.  653 

7  3.  690 

3.730 

3.7oO 

3.750 

3.750 


2.53 
2.53 
2.53 
2.53 


Unclassified  sales  and  redemptions. 


2.50 
2.50 
2.60 
2.50 


.$75, 383, 000. 00 
1,024,065,000.00 


32,  221, 000.  00 
468,  009, 000.  00 


«  12, 000. 00 


8  1,025,000.00 


I  26, 000. 00 


3, 909 
5,  320 

4,  719, 
13,611, 
10, 982 

4,  148, 

3,  973, 

4,  950, 

5,  692, 

4,  790, 

6,  775, 
8  14, 

6, 910, 
6, 053, 
6,  251, 
6,  585, 

6,  289, 

7,  279, 
0,744, 

8  34, 
6, 861, 

5,  193, 
250, 734, 

54, 687, 
349, 
563, 
179, 


,  888.  87 
,  003. 89 
453.  48 
127.  51 
724.  (iO 
516. 40 
447.  84 
391.  80 
391.  09 
480.  18 
487.  70 
243.  77 
389.  83 
307.  68 
650.  77 
117.41 
394. 87 
120.  21 
975.  71 
667. 13 
741.74 
695.  78 
387. 13 
712.  50 
735.  20 
871.  20 
927.  70 
196. 30 
8  23.  72 


$75,  383, 000.  00 


32,  221, 000. 00 
1,  492, 950, 000. 00 


8  12, 000. 00 


3, 966, 
11,613, 
18,713, 
22, 002, 
19,  377, 
10, 126, 
10,971, 
12,719, 
14,  2o8, 
16,  597, 
18, 870, 
2,823, 
5, 830, 
10,  080, 
11,047, 
13, 635, 

13,  649, 
1,  200, 

13,517, 

14,  927, 
7,  589, 

11,847, 

44,  457, 

54,  33,6, 

27, 009, 

8, 187, 

322, 

427, 

304, 

•  2, 748. 

33,  132, 

3, 786, 

1, 482, 

587, 

'  1, 193, 


522.  72 
082.  70 
965.  72 
202. 00 
686.  28 
674. 56 
961. 10 
707. 18 
748.  49 
902.  37 
881.45 
933.  43 
637. 15 
859. 02 
874. 82 
364.76 
257.  21 
104.  20 
689.  OH 
375.  35 
184.  77 
289.  27 
040.  35 
075.  00 
645.  85 
901.  90 
254.  49 
467.  05 
425. 00 
409.  47 
800.  00 
800. 00 
000.  00 
100.  00 
200. 00 


Footnotes  at  end  of  table. 


TABLES 


603 


Table   37. — Issues,    maturities,    and   redemptions   of  interest-bearing   public   debt 
securities,  excluding  special  issues,  July  1960-June  1961  ^ — Continued 


Date 

Security 

Rate  of 

interest  2 

Amount  issued  ^ 

Amount  matured 

or  called  or 

redeemed  prior 

to  maturity  i 

1961 
June  30 

U.S.  savings  bonds  «— Continued 

Scries  H-1952 

Percent 

^  3, 123 

7  3. 161 

"3.211 

'  3.  258 

7  3. 317 

3.360 

'  3.  626 

^  3.  679 

3.720 

3.  7.-i0 

3.750 

3.750 

$432,000.00 

1,  226,  500. 00 

2,  325,  000. 00 
3, 467, 000.  00 
2, 628, 000.  00 

196  500  00 

30 

Series  H-1953 

30 

Scries  H-1954 

30 

Series  H-195.5 

30 

Series  H-1956 

30 

Series  H-1957  (.January)  _. 

30 

Scries  H-1957  (February  to  December)... 
Series  H-1958 

1, 789,  500. 00 

30 

3  131  500  00 

30 

Series  H-1959  (January  to  May) 

1,  240, 000. 00 
1,  271, 000. 00 

30 

Series  11-1959  (June  to  December) 

Series  H-1960 

30 

$25,  500. 00 

83,310,000.00 

9  1, 322,  500. 00 

209, 328. 70 

291,  643.  80 

494,  247.  57 

327, 957. 30 

228, 437.  27 

75, 634. 75 

2, 814,  500. 00 
82  500  00 

30 

Series  H-1961 

30 

Unclassified  sales  and  redemptions 

9  1,  442, 000.  00 
208  041  95 

30 

Series  J-1962 

2.76 
2.70 
2.76 
2.76 
2.76 
2.76 

30 

Series  J-1953 

635, 746  30 

30 

Scries  J-1954 

642  986  76 

30 

Series  J-1956 

770,  977. 00 
592  211  42 

30 

SeriesJ-1956 

30 

Series  J-1957 

100  089  70 

30 

Unclassified  sales  and  redemptions 

9  411,  064. 15 
057,  500.  00 

30 

Series  K-19,52 

2.76 
2.76 
2.76 
2.76 
2.76 
2.76 

30 

Series  K-1953. _. 

894  500  00 

30 

Series  K-1954 

1, 779,  000. 00 
2, 091,  000. 00 

30 

Series  K-19o5 

30 

Series  K-1956  .    

959,  500. 00 

30 

Series  K-1957 

193,  500. 00 

30 

Unclassified  sales  and  redemptions 

'  756, 000. 00 

30 

Depositary  bonds,  First  Series 

2.00 
2.00 

23/4 

V/i 

1,  575, 000. 00 
815, 000. 00 

4,  231, 000. 00 

30 

Treasury  bonds,  R.E.A.  Series.. _ 

80. 000. 00 

30 

Tre:isury  Bonds,  Investment  Series  B-1975-80: 
Redeemed  in  exchange  for  Treasury  notes, 
Series  EA-1966 

12, 434, 000. 00 

30 

Treasury  notes,  Series  EA-1966 

12, 434, 000. 00 

30 

Miscellaneous 

26,  513, 900. 00 

Total  June 

10,  237, 042, 202. 94 

11, 900,  733,  292. 78 

Total  fiscal  year  1961 

149, 015, 972, 411.  66 

146,  513, 388, 893. 46 

1  Interest  rates  on  Series  E  and  H  savings  bonds  were  increased  on  Sept.  22, 1959,  retroactive  to  June  1, 1959. 

2  For  Treasury  bills,  average  rates  on  ban!:  discount  basis  are  shown;  for  savings  l)onds,  approximate  yield 
to  maturity  is  shown. 

3  Since  May  1, 1957,  Series  E  and  H  bonds  have  been  the  only  savings  bonds  on  sale.  Amounts  represent 
accrued  discount  plus  issue  price  of  bonds  in  adjustment  cases  for  Series  F  and  J  and  for  Series  E  not  cur- 
rently on  sale.  Foi  Series  E  currently  on  sale  and  for  Series  J  (prior  to  May  1957)  amounts  represent  issue 
price  plus  accrued  discount,  and  for  Series  H  and  for  Series  K  (prior  to  May  1957)  amounts  represent  issue 
price  at  par. 

*  For  savings  bonds  of  Series  E,  F,  and  J  amounts  represent  current  redemption  value  (issue  price  plus 
accrued  discount);  and  for  Series  G,  H,  and  K  amounts  represent  redemption  value  at  par. 

5  Average  interest  rate  for  combined  original  and  additional  i.ssues. 

6  At  option  of  owner.  Series  E  bonds  dated  May  1, 1941,  through  May  1, 1949,  may  be  held  and  will  accrue 
interest  for  additional  20  years;  bonds  dated  on  and  after  June  1,  1949,  may  be  held  and  will  accrue  interest 
for  additional  10  years. 

'  Represents  a  weighted  average  of  the  approximate  yields  of  bonds  of  various  issue  dates  within  the  yearly 
series  if  held  to  maturity  or  if  held  from  issue  date  to  end  of  applicable  extension  period  computed  on  the  basis 
of  bonds  outstanding  March  31,  19G1.  (See  Treasury  Circulars  Nos.  653  and  905  revised  Sept.  23.  1959,  and 
first  amendment  to  Treasm-y  Circular  No.  653,  Revised,  dated  March  21,  1961,  for  details  of  yielas  by  issue 
dates.) 

8  Deduct. 

9  Deduct:  Amounts  transferred  fiom  unclassified  sales  and  redemptions  to  sales  and  redemptions  of  desig- 
nated series. 

"1  Represents  an  additional  $100,104,000  on  each  of  18  series  of  outstanding  Treasury  bills  issued  in  a  "strip" 
to  mature  each  week  from  Aug.  3  through  Nov.  30,  1961. 
"  Adjustment  of  overstatement  of  amount  issued  for  cash  on  May  15. 


614359—62- 


-39 


604 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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II2I 


TABLES 


605 


Table  39. — Public  debt  increases  and  decreases,  and  balances  in  the  account   of 

the   Treasurer  of  the   U.S.,  fiscal  years  1916-61 

[In  millions  of  dollars.    On  basis  of  daily  Treasury  statements,  see ' '  Bases  of  Tables"] 


Fiscal  year 


1916. 
1917. 
1918. 
1919. 
1920. 
1921. 
1922. 
1923. 
1924. 
1925.. 
1926.. 
1927.. 
1928.. 
1929.. 
1930.. 
1931.. 
1932.. 
1933.. 
1934. 
1935.. 
1936.. 
1937.. 
1938.. 
1939.. 
1940.. 
1941_. 
1942.. 
1943-. 
1944- . 
1945.. 
1946_. 
1947- 
1948.. 
1949- . 
1950- 
1951- 
1952- . 
1953-. 
1954.. 
1955-. 
1956- 
1957- 
1958- 
1959.. 
I960.. 
1961- 


Public  debt 

outstanding 

at  end  of 

year 


Total. 


1 

2, 

12, 

25, 

24, 

23, 

22, 

22, 

21, 

20, 

19, 

18, 

17, 

16, 

16, 

16, 

19, 

22, 

27, 

28, 

33, 

36, 

37, 

40, 

42, 

48, 

72, 

136, 

201, 

258, 

269, 

258, 

252, 

252, 

257, 

255, 

259, 

266, 

271, 

274, 

272, 

270, 

276, 

284, 

286, 

288, 


,  225. 1 
,  975.  6 
455.2 
484.5 
299.  3 
977.5 
963.4 
349.7 
250.8 
516.2 
643.2 
511.9 
604.3 
931.1 
185.3 
801.3 
487.0 
538.7 
053.1 
700.9 
778.5 
424.6 
164.7 
439.5 
967.5 
961.4 
422.4 
696.1 
003.4 
682.2 
422.1 
286.4 
292.2 
770.4 
357.4 
222.0 
105.2 
071.1 
259.6 
374.2 
750.8 
527.2 
343.2 
705.9 
330.8 
970.9 


Increase,  or 
decrease  (— ), 
during  year 


33.8 

1,  750.  5 
9, 479.  6 

13, 029. 3 

-1,185.2 
-321. 9 

-1,014.1 
-613.  7 

-1,098.9 
-734.  6 
-873. 0 

-1,131.3 

-907. 6 

-673. 2 

-745. 8 

616.0 

2,  685.  7 
3,051.7 
4,  514. 5 
1,647.8 
5, 077.  7 

2. 646. 1 
740.1 

3, 274.  8 

2,  528. 0 

5, 993. 9 

23, 461.  0 

64,  273. 6 

64, 307. 3 

57,  678.  8 

10,  739. 9 

-11,135.7 

-5, 994. 1 

478.1 

4,  587. 0 

-2, 135. 4 

3. 883. 2 
6, 965. 9 
5, 188.  5 
3,114.6 

-1,623.4 
-2,  223. 6 
5,816.0 
8, 362. 7 
1,  624. 9 
2, 640. 2 


Analysis  of  increase  or  decrease 


E.xcess  of 
e.xpenditures 

(+),  or 
receipts  (— ) 


287, 779. 6 


-48.5 

+853. 4 

+9,  033.  3 

+13, 370.  6 

-212.  5 

-86.7 

-313.8 

-309.  7 

-505. 4 

-250.  5 

-377. 8 

-635.  8 

-398. 8 

-184.8 

-183.8 

+902.  7 

+3, 153. 1 

+3, 068.  3 

+3, 154.  6 

+2,  961.  9 

+4,  640.  7 

+2, 878. 1 

+  1,143.1 

+2,  710.  7 

+3, 604.  7 

+5,315.7 

+23, 197.  8 

+57,  761.  7 

+53, 645.  3 

+53, 149. 6 

+21, 199. 8 

-206. 0 

-6, 606. 4 

+1,947.5 

+2,  592. 0 

-3, 973. 6 

+4,271.8 

+9, 265. 0 

+3, 092.  7 

+3, 665. 6 

-1,190.8 

-1,267.3 

+1,656.9 

+12,761.4 

-1,029.5 

+4, 950.  8 

+292, 167. 2 


Increase  (+) 
or  decrsase 
(— ),  in  the 
balance  in 
Treasurer's 
account 


+82.3 

+897. 1 

+447.  5 

-333. 3 

-894. 0 

+  192.0 

-277.  6 

+98.8 

-135.5 

-17.6 

-7.8 

+24.1 

+31.5 

+61.2 

-8.1 

+153.3 

-54.7 

+445.  0 

+1,719.7 

-740.  6 

+840.  2 

-128.0 

-337.  6 

+622.  3 

-947.  5 

+742. 4 

+358. 0 

+6,  515.  4 

+10,  662. 0 

+4,  529. 2 

-10, 459.  8 

-10,929.7 

+1,  623.  9 

-1,461.6 

+2, 046.  7 

+1, 839.  5 

-387. 8 

-2, 298. 6 

+2, 096. 2 

-550.  8 

+330.  5 

-956. 2 

+4, 159. 2 

-4,  398.  7 

+2,  654.  3 

-1,310.6 


+6,  536.  0 


Decreases 

due  to 
statutory 
debt  retire- 
ments ' 


1.1 

8.0 
78.7 
427.1 
422.7 
402.9 
458.0 
466.5 
487.4 
519.6 
540.3 
549.6 
553.9 
440.1 
412.6 
461.6 
359.9 
573. 6 
403.2 
104.0 
65.5 
58.2 
129.2 
64.3 


(*) 


1,011.6 
7.8 
51.7 
1.2 
.9 
.5 
.4 
.2 
763.1 
.1 


2.1 

'i,'6o6."o" 


10, 923. 6 


Balance  in 
Treasurer's 
account  at 
end  of  year 


240.4 
1, 137.  5 

1,  585. 0 
1,251.7 

357.  7 
549.7 
272.1 
370.9 
235.4 
217.8 
210.0 
234.1 
265.5 
326.7 
318.6 
471.9 
417.2 
862.2 

2,  581.  9 

1,  841,  3 

2,  681.  5 
2,  553.  5 
2, 215.  9 

2,  838. 2 
1, 890.  7 
2, 633.  2 

2. 991. 1 
9,  506.  6 

20, 168.  6 
24,  697.  7 
14, 237. 9 

3,  308. 1 
4, 932.  0 
3, 470. 4 

5,  517. 1 
7, 356.  6 
6, 968. 8 

4. 670. 2 
6, 766.  5 

6,  215.  7 
6,  546.  2 
5,  590. 0 
9,  749. 1 
5, 350. 4 
8, 004.  7 
6, 694,.  1 


*  Less  than  $50,000. 

1  ESective  with  the  fiscal  year  1948,  statutory  debt  retirements  have  been  excluded  from  budget  expendi- 
tures; they  are  shown  here  for  purposes  of  comparison. 

2  Adjustment  for  overstatement  of  price  paid  for  securities  purchased  in  fiscal  1956  at  a  discount  but 
previously  stated  at  par  value. 

SUMMARY  OF  CHANGES  IN  THE  PUBLIC  DEBT,  FISCAL  YEARS  1916-61 
[In  millions  of  dollars] 
Public  debt: 

As  of  June  30,  1961 288,  970.  9 

As  of  June  30,  1915 1,191.4 

Net  increase 287,779.6 

Increase:  = 

Excess  of  expenditures  in  deficit  years 309,948.8 

Net  increase  in  the  balance  in  the  account  of  Treasurer  of  the  U.S...       6, 536. 0 


Total  increase 316,484.8 

Decrease: 

Statutory  debt  retirements 10, 923. 6 

Retirements  from  receipts  in  surplus  years 17,781.6 

Total  decrease 28,705.2 


Net  increase  in  debt  since  June  30, 1915 287, 779. 6 


606 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  40. — Statutory  debt  retirements,  fiscal  years  1918-1961 

[In  thousands  of  dollars.    On  basis  of  par  amounts  and  of  daily  Treasury  statements  through  1947,  and  on 
basis  of  Public  Debt  accounts  thereafter,  see  "Bases  of  Tables"] 


Fiscal  year 

Cumu- 
lative 
sinking 
fund 

Repay- 
ments of 
foreign 
debt 

Bonds 

and 

notes 

received 

for 
estate 
taxes 

Bonds 
received 
for  loans 
from 
Public 
Works 
Adminis- 
tration 

Fran- 
chise tax 
receipts, 
Federal 
Reserve 

Banks 

Payments 
from  net 
earnings, 
Federal 
inter- 
mediate 
credit 
banks 

Com- 
modity 
Credit 
Corpo- 
ration 
capital 
repay- 
ments 

Miscel- 
laneous 
gifts, 
forfei- 
tures, 
etc. 

Total 

1918 

1,134 

1  134 

1919 

7,922 
72,  670 
73, 939 
64,838 
100, 893 
149, 388 
159.179 
169,  654 
179,  216 
181, 804 
176,  213 
160. 926 
48, 246 

93 

3,141 

26, 349 

21,085 

6,569 

8,897 

47 

8  015 

1920 

2,922 

60,  724 

60,333 

10,815 

3,635 

114 

59 

818 

250 

2,667 

4,283 

18 

13 

15,010 

393 

555 

93 

208 

63 

5,578 

3,090 

160 

61 

85 

53 

21 

15 

556 

1 

14 

139 

12 

16 

16 

5 

4 

3 

2 

4 

3  209, 828 

3  81 

'690 

78  746 

1921 

261. 100 

276, 046 

284,019 

295,  987 

306,  309 

317,092 

333,  528 

354.  741 

370, 277 

388,  369 

391, 660 

412.  555 

425, 660 

359. 492 

573. 001 

403, 238 

103,815 

65, 116 

48,518 

128,  349 

37,011 

75,  342 

3,460 

-1 

427  123 

1922 

422  695 

1923 --- 

402  850 

1924 -.. 

458,  000 
466.  538 
487, 376 
519  555 

1925 

680 
509 
414 
369 
266 
172 
74 
21 

1926 

1927 

1928 

2 
20 
73 

540  255 

1929 

549,  604 
553, 884 
440, 082 
412,  6.30 
461  605 

1930 

1931 -. 

1932 

1 

1933 - 

33, 887 
357 

2,037 

1934 

359  864 

1935 

1 

573  558 

1936 -.. 



403,240 
103,  971 
65  465 

1937... 

142 
210 
120 

1938 

1939 

8,095 
134 

1,321 
668 

1,501 
685 
548 
315 

58, 246 
120  184 

1940 

1941 

25, 364 
18, 393 

64  ?fiO 

1942. 

94  722 

1943 

3,463 
2 

1944 

1945 

2 

1946 

4 

1947 

1948.. 

746, 636 

7,498 

1,815 

839 

551 

241 

8,028 

1,634 
178 
261 
394 
300 
285 
387 
231 
462 
139 

45, 509 

1,011.636 

7,758 

51  709 

1949 

1950. 

48, 943 

1951 

1  232 

1952 

851 

1953.. 

526 

1954 

387 

1955 

231 

1956 

762, 627 

763,089 
139 

1957 

1958 

1959 

<-57 

4—57 

1960 

1961-. 

1, 000, 000 

1,  000, 000 

Total 

8,  734,  833 

1.  579,  605 

66, 278 

18, 246 

149,  809 

9,825 

138,209 

226.  769 

10,  923,  575 

1  Inclu  les  $4,842,066.45  written  off  the  debt  Dec.  31,  1920,  for  fractional  currency  estimated  to  have  been 
lost  or  destroyed  in  circulation. 

2  Beginning  with  1947,  bonds  acquired  through  gifts,  forfeitures,  and  estate  taxes  are  redeemed  prior  to 
maturity  from  regular  public  debt  receipts. 

3 Represents  payments  from  net  earnings.  War  Damage  Corporation. 

*  Adjustment  for  overstatement  of  pric«  paid  for  securities  purchased  in  fiscal  1956  at  a  discount  but 
jjreviously  stated  at  par  value. 


TABLES 


607 


Table  41.— Cumulative  sinking  fund,  fiscal  years  1921-61 
[In  millions  of  dollars.    On  basis  of  Public  Debt  accounts,  see  "Bases  of  Tables") 


Appropria- 
tions 

Available 
for  expendi- 
ture during 
year » 

Debt  retired » 

Fiscal  year 

Par  amount 

Cost  (prin- 
cipal) 

1921  

256.2 
273.1 
284.1 
294.9 
306.7 
321.2 
336.9 
355.1 
370.2 
382.9 
392.2 
410.9 
425.6 
438.5 
493.8 
553.0 
572.8 
577.6 
580.9 
582.0 
585.8 
586.9 
587.8 
587.6 
587.6 
587  6 
587.6 
603.5 
619.6 
619.7 
619.8 
619.8 
619.8 
619.8 
619.8 
623.8 
633.3 
633.3 
633.3 
633.  3 
657. 1 

256.2 

274.5 

284.2 

294.9 

306  7 

321.2 

336.9 

355.1 

370.2 

382.9 

392.2 

410.9 

425.6 

438.5 

573.2 

553.2 

722.7 

1, 196.  5 

1,712.2 

2, 245.  6 

2, 703. 2 

3,  253. 1 

3, 765. 6 

4,349.7 

4, 937. 4 

5,  525. 0 
6,112.6 
6,716.0 

6,  589. 0 
7, 201.  2 
7,819.2 
8, 438. 1 
9, 057.  4 
9,  676. 9 

10.  296.  7 
'  10, 920.  5 

10, 791. 2 

11,  424.  5 
12, 057. 9 
12,691.3 
13,348.4 

261.3 

275.9 

284.0 

296.0 

306.3 

317.1 

333.5 

354.7 

370.3 

388.4 

391.7 

412.6 

425.7 

359.5 

573.0 

403.3 

103.7 

65.2 

48.5 

128.3 

37.0 

75.3 

3.4 

254.8 
274  5 

1922 

1923 

284  1 

1924 

294  9 

1925 

1926 

321  2 

1927 

336  9 

1928 

355  1 

1929 

370  2 

1930 

382  9 

1931      

392  2 

1932 

410  9 

1933      

425  6 

1934 

359  2 

1935 

573  0 

1936 

403  3 

1937 

103  7 

1938 

65  2 

1939 

48  5 

1940 

128  3 

1941 

37.0 

1942 

75  3 

1943 

3.4 

1944 

1945 

1946 

1947 

1948 

746.6 
7.5 
1.8 
.8 
.6 
.2 

746  6 

1949    

7.5 

1950... 

1.8 

1951      

.8 

1952 

.6 

1953             

.2 

1954 

1955             

1956 

762.6 

762.6 

1957 _. 

1958          

1959 

1960                                          .      .              ... 

1961            .-     

1,000.0 

1, 000. 0 

Total  

21,  075.  5 
8,  727. 1 

8,  734. 8 

8,  727. 1 

Deduct  cumulative  e.xpenditures 

Unexpended  balance 

12, 348. 4 

■■  Revised. 

'  See  the  following  table,  footnote  1. 

2  Net  discount  on  debt  retired  through  June  30, 1961,  is  $7.7  million. 


608 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  42. —  Transactions  on  account  of  the  cumulative  sinking  fund,  fiscal  year  1961 
[On  basis  of  Public  Debt  accounts,  see  "  Bases  of  Tables"] 

Unexpended  balance  July  1, 1960 $12,691,315,633.43 

Appropriation  for  1961: 
Initial  credit: 

(a)  Under  the  Victory  Loan  Act  {.2W7o  of  the  aggregate 

amount  of  Liberty  bonds  and  Victory  notes  out- 
standing on  July  1,  1920,  less  an  amount  equal  to  the 
par  amount  of  any  obligation  of  foreign  governments 
held  by  the  United  States  on  July  1,  1920) _.    $253,404,864.87 

(b)  Under  the  Emergency  Relief  and  Construction  Act  of 

1932  (2)^%  of  the  aggregate  amount  of  expenditures 
from  appropriations  made  or  authorized  under  this 
act) 7,860,606.83 

(c)  Under  the  National  Industrial  Recovery  Act  (2^i%  of  the 

aggregate  amount  of  expenditures  from  appropriations 

made  or  authorized  under  this  act) 80,164,079.  53 

Total  initial  credit 341,429,551.23 

Secondary  credit  (the  interest  which  would  have  been  payable 
during  the  fiscal  year  for  which  the  appropriation  is  made  on 
the  bonds  and  notes  purchased,  redeemed,  or  paid  out  of  the 
sinking  fund  during  such  year  or  in  previous  years) 315,  669,  534.  24  657, 099, 085.  47 

Total  available  1961 13,  348,  414,  718.  90 

Securities  retired  in  1961 1,000,000,000.00 

Unexpended  balance  June  30, 1961  ' 12,348,414,718  90 

'  Represents  appropriations  authorized  by  Congress.  There  are  no  specific  funds  set  aside  for  this  account 
since  any  retirements  of  public  debt  charged  to  this  account  are  made  from  cash  balances  to  the  credit  of 
the  Treasurer  of  the  United  States. 


TABLES 


609 


III. — United  States  savings  bonds 

Table  43. — Summary  of  sales  and  redemptions  of  savings  bonds  by  series,  fiscal 
years  1935-61  and  monthly  1961  ^ 
[In  millions  of  dollars.    On  basis  of  daily  Treasury  statements,  see  "Bases  of  Tables"] 


Fiscal  year  or  month 

Series 
A-D 

Series  E 
andH2 

Series 
FandJ 

Series  O 
and  TC  2 

Total 

Sale 

5  at  issue  price  plus  accrued  discount 

1935-51     

5, 0O3. 1 

66, 673. 4 
4,406.7 
5,  ISO.  9 

5,  778.  7 

6,  347.  6 
6, 374.  0 
5,  745.  5 
5,  830.  8 
5,  680.  4 
5,501.2 
5, 717.  4 

5, 277. 3 

217.  5 

237.1 

336.1 

423.4 

282.9 

175.8 

65.2 

53.6 

46.0 

32.1 

23,015.4 
508.2 
372,7 
612.  6 
933.2 
403. 1 
176.0 
(*) 
(*) 

99, 669. 2 

1952                                -    .     -. 

5, 132.  4 

1953       

5,  790.  7 

1954  3     _ 

6,  727.  4 

1955  3 

7,  704. 2 

1956                            .                 -        . 

7, 059. 9 

1957 

19.58                                    .     -  - 

6,097.4 
5, 896. 1 

1959..   

5,  734. 0 

1960 

5,  547. 2 

1961.      

5,  749.  5 

Total  through  June  30,  1961 _- 

5, 003.  1 

123, 236.  8 

7, 146.  9 

26,021.1 

161,  407. 9 

I960 — July 

474.8 
449.5 
433.  4 
436.  7 
420.2 
470.6 
581.4 
513.1 
531.7 
442.8 
467.8 
495.4 

4.3 
2.2 
2.3 
.3.0 
2.3 
2.8 
3.0 
2.3 
2.1 
2.9 
2.2 
2,7 

479.1 

451.8 

435.7 

439.8 

422.4 

December                            ...        . 

473.4 

584.3 

February                             -             .... 

515.3 

533.8 

445.8 

470.0 

498.1 

Redemptions   (including  redemptions  of  matured 
bonds)  at  current  redemption  value 

1935-51                 

4,791.3 

89.9 

30.8 

18.3 

14.1 

10.9 

8.6 

5.9 

5.2 

5.6 

4.1 

32, 167. 0 
4,007.8 
4, 038. 1 
4,345.0 

4,  544.  4 

4. 730. 1 

5. 176. 2 
5, 187. 1 
5, 106. 8 

5,  502. 2 
4, 626.  7 

1,388.6 
228.9 
*  257.  5 
<  405. 0 
553.0 
724.9 
815.8 
586.2 
336.4 

5  627.  7 

6  251.4 

3, 838.  5 

782.8 

M,294.4 

<  1,  746.  6 

2, 138. 4 

2,379.9 

2, 957.  7 

2,  764.  2 

1,  800. 8 

5  2,  421.  7 

6  936.  5 

42, 185. 3 

1952.     

5, 109, 3 

1953                                       - 

*  5, 620. 9 

1954  3 

4  6,514.9 

19553                                     

7,  250. 6 

1956                

7,845.8 

1957 

8,  958. 2 

1958            .        

8,  543.  5 

1959 

7, 249.  2 

I960                       .          .     

5  8, 557. 2 

1961       

6  5,818.7 

Total  through  June  30,  1961       

4, 984. 6 

79, 431. 2 

6,176.2 

23, 061. 6 

113,653.6 

I960 — July                                               - 

.3 
.3 
.3 
.3 

.5 
.2 
.3 
.3 
.5 
.4 
.3 
.3 

411.1 
401.2 
392.4 
352.1 
344.3 
361.7 
440.8 
374.9 
411.8 
372.1 
372.1 
392.3 

76.9 
17.8 
13.1 
13.4 
11.6 
9  27.6 
8  22,  8 
13.6 
15.8 
12.0 
14.6 
12.3 

194.4 
57.0 
47.5 
47.0 
41.8 
6  185.  9 
6  94.6 
58.9 
61.0 
48.8 
49.1 
50.5 

682.7 

476.2 

453.2 

412.9 

398.1 

6  575. 3 

6  558. 6 

447,7 

489.1 

433.4 

436.1 

455.  4 

•Less  than  $50,000.  ,  ^  x.  ,     o    •      ^ 

1  Sales  and  redemptions  figures  include  exchanges  of  minor  amounts  of  matured  Series  E  for  Series  ti  and 
K  bonds  from  Mav  1951  through  April  1957,  and  Series  F  and  J  for  Series  H  bonds  beginning  January  1960; 
they  exclude  e.xchanges  of  Series  E  for  Scries  H  bonds,  which  are  reported  in  table  44. 

2  Series  G,  H,  and  K  are -stated  at  par.  ^  ,,,  ,_      ,    .     t  ,     ,r^r.  * 

3  Reductions  were  made  in  issues  and  redemptions  of  Series  E,  H,  F,  G,  J,  and  K  bonds  in  July  1954  to 
compensate  for  the  erroneous  inclusion  of  reissue  transactions  in  June  1954  as  reported  in  the  daily  Treasury 
statement.  The  amounts  involved  were  as  follows:  $18  million  for  issues  of  Series  E  and  H,  $17  million 
for  issues  of  Series  F,  G,  J,  and  K,  and  .$35  miUion  for  unclassified  retirements. 

*  Includes  exchanges  of  Series  1941  F  and  G  savings  bonds  for  3H%  Treasury  bonds  of  1978-83. 

5  Includes  exchanges  of  Series  1948  F  and  Q  savings  bonds  for  4%%  Treasury  notes  of  1964. 

6  Includes  exchanges  of  Series  1949  F  and  G  bonds  for  4%  Treasury  bonds  of  1969. 

Note.— Series  E  and  H  are  the  only  savings  bonds  now  being  sold.  Series  A-D  were  sold  from  March  1, 
1935,  through  April  30,  1941.  Series  F  and  Q  were  sold  from  May  1,  1941,  through  April  30,  1952.  Series  J 
and  K  were  sold  from  May  1,  1952,  through  April  30,  1957.  Sales  figures  for  discontinued  series  represent 
accrued  discount  on  outstanding  bonds  and  adjustments. 


610 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  44. — Sales  and  redemptions  of  Series  E  through  K  savings  bonds  by  series, 
fiscal  years  1941-61  and  monthly  1961  ^^ 

[In  millions  of  dollars] 


Sales 

Accrued 
dis- 
count 

Sales 

plus 
accrued 
discount 

Redemptions 

Amount  out- 
standing 

Fiscal  year  or  month 

Total 

Original 
pur- 
chase 
price  3 

Accrued 

dis- 
count 3 

Interest 
bearing 

Ma- 
tured 

Series  E  and  H 

1941-51 

61, 969. 5 

3,  296. 1 
4, 060.  6 

4,  652.  9 
5, 224. 5 

5,  259.  9 
4,613.0 
4,  670.  1 
4,  .506.0 
4. 307. 0 
4, 463.  7 

4, 703.  9 
1,110.6 
1, 120.  3 
1,125.9 
1, 123. 1 
1,114.1 
1, 132.  6 
1,160.7 
1,174.5 
1,194.2 
1, 253. 7 

66, 673.  4 
4, 406.  7 
5, 180.  9 
5, 778.  7 
6,  347.  6 
6, 374. 0 
5,  745. 5 
5,  830. 8 
5,  680. 4 
5,501.2 
5,717.4 

32, 167.  0 
4, 007.  8 

4. 038. 1 
4,345.0 
4,  544.  4 

4,  730. 1 

5. 176. 2 
5, 187. 1 
5,106.8 

5,  502. 2 
4, 626.  7 

r31,161.6 

r  3.  581.0 
'  3.  540. 5 
'3.774.8 
'3,911.4 
r  4, 069. 1 
r  4,  444.0 
■■4,129.3 
'4,309.8 
'4.616.3 
3, 905. 8 

'1,005.4 
'  426. 8 
'  497.  6 
'  570.  2 
'  633. 0 
'  660.  9 
'  732.  2 

'1,0.57.8 

'  797.  0 

'  885.  9 

720.8 

34, 506. 4 
34,  P05.  4 
36, 048.  2 
37,  482. 0 

39,  285. 1 

40.  929.  1 
41,498.5 
42. 142.  2 
42,715.8 
42.714.8 
43, 805.  6 

1952 

1953       

1954< 

19554 

1956         --. --- 

1957       

1958 

1959         

1960 

1961 

Total  through  June 
30,  1961 

107, 023. 3 

16,213.5 

123, 236. 8 

79, 431. 2 

71, 443.  7 

7,  987. 6 

43, 805. 6 

1960— July 

353. 7 
355. 5 
339.8 
345.7 
326.4 
348.3 
455.7 
415.5 
434.7 
348.3 
370.7 
369.6 

121.2 
94.1 
93.6 
91.0 
93.8 

122.3 

125.  7 
97.5 
97.0 
94.6 
97.2 

125.7 

474.8 
449.5 
433.4 
436.7 
420.2 
470.6 
581.4 
513.1 
531.7 
442.8 
467.8 
495.4 

411.1 
401.2 
392.4 
352. 1 
344.3 
361.7 
440.8 
374.9 
411.8 
372.1 
372.1 
392.3 

346.  2 
340.7 
333.2 
298.  5 
291.8 
307.0 
3''0.  3 
313.7 
349.8 
315.  8 
316.2 
332.6 

64.9 
60.5 
59.2 
53.6 
52.5 
54.6 
80.5 
61.2 
62.0 
.56.3 
55.9 
59.7 

42,  778. 5 
42, 826. 9 
42. 867.  9 

42. 952. 5 
43, 028. 4 
43, 137. 3 

43.  277.  9 
43,416.1 
43. 536. 0 
43,  606. 7 
43.  702. 5 

43. 805. 6 

August 

September     . 

October  .   

November 

December _ 

1961 — January  

February 

March-    

April 

May._     

June 

S 

eries  F,  O 

,  J,  and  K 

1941-51 

27, 875.  9 
629.3 
501.5 
841.0 
1, 248.  9 
586.  3 
268.4 
(*) 
(') 
(*) 
(*) 

416.8 
96.4 
108.3 
107.7 
107.7 
99.6 
83.4 
65.  2 
53.6 
46.0 
32.1 

28,  292.  7 

725.6 

609.8 

948.6 

1,  356.  6 

686. 0 

351.8 

65.2 

53.6 

46.0 

32.1 

5,227.1 
1,011.7 
1.552.0 
2,151.6 

2,  692. 0 
3, 104.  8 

3,  773.  5 
3. 3-0.  5 
2,137.2 
3, 049. 3 
1, 188. 0 

'5,162.7 
990.2 
'1,511.8 
'2.069.1 
'2,  ,565.0 
'2,940.6 
'3,605.0 
'3.234.6 
'2.063.4 
'2,921.2 
1,128.8 

'64.4 
21.4 

'40.1 

'82.6 
'  127. 1 
'  164.  2 
'  168.  5 
'115.9 

'73.8 

'  128. 1 

59.1 

23.  065.  6 

22,  779. 6 

21,837,4 

20,  579.  2 

19, 080. 3 

16.  ,567.  6 

13.123.5 

9, 842. 2 

7.  786. 7 

4,  829. 0 

3,  708.  7 

1952               

1953         

1954  4 

,55.2 

1955*         .            

218.7 

1956       

312.4 

1957..   

334.8 

1958           

331.0 

1959         

302.8 

1960 

257.3 

1961 

221.6 

Total  through  June 
30,  1961 

31,951.2 

1,216.8 

33, 168. 0 

29, 237. 7 

28, 192. 5 

1, 045.  2 

3,  708.  7 

221.6 

1960— July       

4.3 
2.2 
2.3 
3.0 
2.3 
2.8 
3.0 
2.3 
2.1 
2.9 
2.2 
2.7 

4.3 
2.2 
2.3 
3.0 
2.3 
2.8 
3.0 
2.3 
2.1 
2.9 
2.2 
2.7 

271.3 
74.7 
60.6 
60.5 
53.4 
213.4 
117.5 
72.5 
76.8 
60.9 
63.7 
02.8 

252.4 
71.1 
57.7 
57.6 
50.7 
206.6 
111.9 
69.2 
73.1 
58.2 
60.3 
60.0 

18.9 
3.6 
2.9 
2.9 
2.7 
6.8 
5.6 
3.2 
3.6 
2.7 
3.4 
2.9 

4, 572. 3 
4, 509.  9 

4. 458. 8 
4,  406. 9 

4. 365. 9 
4,021.8 
3, 965. 2 
3,911.1 
3, 859. 1 
3,813.4 
3,  758. 6 
3,  708. 7 

247.0 

August 

236.8 

September 

(*) 

229.  7 

October      

224.2 

November 

214.1 

December    . 

347.6 

289.6 

February 

273.6 

March     .  . 

250.8 

238.6 

May 

231.8 

221.6 

Footnotes  at  end  of  table. 


TABLES 


611 


Table  44. — Sales  and  redemptions  of  Series  E  through  K  savings  bonds  by  series, 
fiscal  years  1941-61  and  monthly  196P^ — Continued 


[In  millions  of  dollarsl 


Sales 

Accrued 
dis- 
count 

Sales 

plus 
accrued 
discount 

Redemptions 

Exchanges 

of  E 
bonds  for 
H  bonds 

Amount 

Fiscal  year  or  month 

Total 

Original 

purchase 

price  3 

Accrued 

dis- 
count 3 

standing 
(interest 
bearing) 

Series  E 

1941-51 

61, 969.  5 
3,  266. 1 
3,  700. 3 

3,  988. 0 

4.  094.  9 
4,219.3 
3,919.2 
3,  888.  6 
3,  688. 0 
3, 603.  2 
3,  689.  2 

4,  703.  9 
1,110.6 
1,120.3 
1.125.9 
1, 123. 1 
1,114.1 
1, 132.  6 
1,160.7 
1,174.5 
1, 194.  2 
1, 253. 7 

66,  673.  4 
4.  376. 7 
4. 820. 6 
.M13.9 
5,218  0 
^..  333.  4 
5,051.8 
5, 049. 3 
4,  862.  5 
4,  797. 4 
4,  942. 9 

32, 167. 0 
4, 007. 8 
4,032.3 
4,319.4 
4,  489. 6 
4.  622. 0 
4, 980.  6 
4,951.0 
4,  889.  4 
5. 180. 6 
4, 393.  8 

'31,161.6 
'3,581.0 
'  3,  534.  7 
'  3,  749. 3 
'  3.  8.56.  5 
'3,961.0 
'  4,  248.  5 
'3,893.2 
'  4, 092.  4 
'  4.  294.  7 
3,  672. 9 

'1,005.4 
'  426. 8 
'  497.  6 
'  570. 2 
'  633. 0 
'  660. 9 
'  732.  2 

'1.057.8 

'797.0 

'  885. 9 

720.8 

34.  sre.  4 
34  875  4 

1952 

1953 

1954  4 

35, 663. 6 
36, 458. 0 

1955  4 

37  186  4 

1956 

37, 897.  8 

1957.. 

37  969  0 

1958 

1959 

26i."3" 
188.3 

38,  C67.  2 
38. 040. 3 
37,  455.  7 
37,816.6 

1960 

1961 

Total  throusjh 
June  30, 1961... 

100, 026. 2 

16,  213.  5 

116,  239. 7 

78,033.5 

70.045.9 

7,  987.  6 

389.6 

37, 816.  6 

1960— July 

291.0 
299.0 
288.1 
295.1 
278.6 
293.9 
353.0 
335.0 
353.1 
289.0 
307.7 
305.7 

121.2 
94.1 
93.6 
91.0 
93.8 

122.3 

125.7 
97.5 
97.0 
94.6 
97.2 

125.7 

412.2 
393.1 
381.7 
386.2 
372.4 
416.3 
478.7 
432.5 
450.1 
383.6 
404.8 
431.4 

388.7 
380.3 
372.1 
333.0 
325.9 
343.5 
423.5 
358.1 
390.0 
354.1 
351.5 
373.1 

323.8 
319.8 
312.9 
279.4 
273.4 
288.9 
343.0 
296.9 
328.0 
297.8 
295.6 
313.4 

64.9 
60.5 
59.2 
53.6 
52.5 
54.6 
80.5 
61.2 
62.0 
56.3 
55.9 
59.7 

17.4 
14.9 
11.3 
10.1 
10.7 
12.1 
22.4 
17.4 
22.1 
15.5 
16.2 
18.1 

37.461.8 
37,  459. 7 
37.458.0 
37,501.1 
37,  536. 9 
37,  597.  5 
37.  030. 3 
37.  687. 2 
37  7*^5  2 

August 

September 

October 

November 

December 

1961— January 

February 

March ..  ._ 

April 

37,  739.  2 
37  776  4 

May . 

June.       

37  816  6 

Series  H 

1952.. 

30.0 
360.3 
664.9 
1, 129. 6 
1,040.6 
693.8 
781.6 
818.0 
703.9 
774.5 

30.0 
360.3 
664.9 
1,129.6 
1, 040.  6 
693.8 
781.6 
818.0 
703.9 
774.5 

30.0 

1953... 

5.7 
25.5 
54.9 
108. 1 
195.5 
236.1 
217.4 
321.6 
232.9 

6.7 
25.5 
54.9 
108.1 
195.5 
236.1 
217.4 
321.6 
232.9 

384  6 

1954  4 

1  023  9 

1955  4 

2, 098.  7 

1956 

3  031.  2 

1957 

3,  529. 5 

1958 

4  075.0 

1959 

4  675.5 

1960 

201.3 
188.3 

5  259. 1 

1961 

5,  989. 0 

Total  through 
June  30, 1961... 

6, 997. 1 

6,  997. 1 

1,  397.  7 

1,  397.  7 

389.6 

5, 989. 0 

1960— July.. 

62.7 
56.4 
51.7 
50.6 
47.8 
54.3 
102.7 
80.6 
81.6 
59.2 
63.0 
63.9 

62.7 
56.4 
51.7 
50.6 
47.8 
54.3 
102.7 
80.6 
81.6 
59.2 
63.0 
63.9 

22.4 
20.9 
20.3 
19.1 
18.4 
18.1 
17.3 
16.8 
21.8 
18.0 
20.6 
19.2 

22.4 
20.9 
20.3 
19.1 
18.4 
18.1 
17.3 
16.8 
21.8 
18.0 
20.6 
19.2 

17.4 
14.9 
11.3 
10.1 
10.7 
12.1 
22.4 
17.4 
22.1 
1.5.5 
16.2 
18.1 

5  316.7 

August 

5,367  2 

September 

5. 409.  9 

October  ..    

5,451.5 

November 

5,491.6 

December 

5,  539.  9 

1961— January 

5,  647.  6 

February 

5,  728. 9 

Mnrch 

5,810.8 

April 

5,  867.  5 

Mav 

5,  926. 1 

June 

5, 989. 0 

Footnotes  at  end  of  table. 


612 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  44. — Sales  and  redemptions  of  Series  E  through  K  savings  bonds  by  series, 
fiscal  years  1941-61  and  monthly  196P^ — Continued 

[In  millions  of  dollars; 


Sales 

Accrued 
discount 

Sales 

plus 
accrued 
discount 

Redemptions 

Amount  out- 
standing 

Fiscal  year  or  month 

Total 

Original 

purchase 

price  3 

Accrued 

dis- 
count 3 

Interest 
bearing 

Ma- 
tured 

Series  F 

1941-51 

4, 860.  4 
97.1 

(*) 

2.9 
-2.8 
(*) 
(*) 
(*) 
(*) 
(*) 

416.8 
96.4 
107.6 
105.1 
100.  9 
87.7 
67.5 
47.1 
35.7 
27.8 
1.5.4 

5, 277.  3 
193  5 
107.7 
108.0 
98.1 
87.7 
67.5 
47.1 
35.7 
27.8 
15.4 

1,388.6 
228.9 
255.  6 
394.4 
532.4 
665.3 
709.3 
487.9 
285.2 
483.5 
212.3 

■■  1. 324.  2 
207.4 
'  215.  5 
'312.0 
'  405.  7 
'  ,502.  3 
'  544.  8 
'  377  6 
'  215.  3 
'  370.  3 
157.9 

'64.4 
21.4 

'40.1 

■■82.4 
■■  126.  7 
'  163. 0 
'164.6 
'110.3 

'69.9 

'  113. 1 

54.4 

3, 888.  7 

3, 853.  3 

3, 705.  3 

3, 388.  8 

2, 876.  9 

2,  249.  9 

1, 598. 3 

1, 169. 1 

943.9 

508.2 

331.2 

1952     .-               --        

1953 

1954  * 

30  1 

1955  < 

107  6 

1956 

157. 1 

1957 

166.8 

1958 

155  3 

1959  - 

131  0 

I960  -     

111  1 

1961 

91.2 

Total  through  June 
30,  1961 

4,957.7 

1, 108. 1 

6,065.8 

5, 643. 4 

4. 633. 1 

1,010.3 

331.2 

91.2 

IQOO—July 

2.7 
.9 
1.0 
1.8 
1.0 
1.3 
1.4 
1.0 
.8 
1.7 
.9 
1.1 

2.7 
.9 
1.0 
1.8 
1.0 
1.3 
1.4 
1.0 
.8 
1.7 
.9 
1.1 

70.4 
12.1 

9.4 
10.0 

9.2 
25.1 
20.2 
11.7 
13.1 

9.6 
11.8 

9.7 

52.3 
9.1 
7.0 
7.5 
6.8 
18.6 
14.9 
8.7 
9.8 
7.3 
8.7 
7.2 

18.2 
3.0 
2.4 
2.5 
2.4 
6.5 
5.2 
3.0 
.3.3 
2.4 
3.0 
2.5 

444.0 
436.4 
430.2 
423.7 
419.4 
365.3 
359.9 
354.  7 
349.2 
345.  4 
336.6 
331.2 

107  5 

August  - 

103  9 

September  --      

101.7 

October 

100  0 

November     

96  1 

126.4 

1961 — January.. 

112  9 

107.4 

100.6 

April 

96  5 

94.4 

June 

91.2 

Series  G 

1941-51   ..  - 

23,015.4 

422.3 

.1 

13.4 

-13.4 

23,015.4 

422.3 

.1 

13.4 

-13.4 

3, 838.  5 

782.8 
1, 288.  7 

1,  726. 2 
2, 107. 3 
2.300.5 

2,  719.  5 
2, 506.  5 
1, 668.  6 
2,055.9 

843.9 

3, 838.  .•; 

782.8 
1, 28S.  7 
1,  726.  2 
2, 107.  3 
2, 300.  5 
2, 719.  5 
2, 506.  5 
1,668.6 
2,055.9 

843.9 

19, 177. 0 
18, 816.  5 
17,527.9 
15,  789.  8 
13,  583. 3 
11, 238.  5 
8,  506. 3 
5, 992. 1 
4, 327.  4 
2, 297.  2 
1, 469. 0 

1952 

1953 

1954  < 

25.2 

1955* 

111.1 

1956  -     

155.4 

1957 

168.0 

1958            

175.7 

1959 

171.8 

1960     . 

146.2 

1961 

130.5 

Total  through  June 
30,  1961 

23, 437.  9 

23, 437. 9 

21, 838. 4 

21,  8.38.  4 

1,469.0 

130.5 

I960— July 

177.1 
45.6 
39.5 
39.6 
35.7 

180.0 
87.8 
53  8 
54.5 
43.0 
42.5 
44.7 

177.1 
45.6 
39.5 
39.6 
35.7 

180.0 
87.8 
53.8 
54.5 
43.0 
42.5 
44.7 

2, 126.  8 
2,087.7 
2,053.2 
2,017.3 
1,987.9 
1,704.6 
1,661.3 
1.618.0 
1,  579.  4 
1, 544.  5 
1, 506.  8 
1,  469. 0 

139.4 

132. 9 

127.9 

October 

124.2 

117.9 

December 

221.2 

1961 — January 

176.7 

166.  2 

150.2 

April 

142.1 

137.4 

June.. 

130.5 

Footnotes  at  end  of  table. 


TABLES 


613 


Table  44. — Sales  and  redemptions  of  Series  E  through  K  savings  bonds  by  series, 
fiscal  years  1941-61  and  monthly  196P^ — Continued 
[In  millions  of  dollars] 


Sales 

Accrued 
discount 

Sales 

plus 
accrued 
discount 

Redemptions 

Amount 

Fiscal  year  or  month 

Total 

Original 

purchase 

price  3 

Accrued 
discount  ' 

ing 
(interest 
bearing) 

Series  J 

1952 

24.0 
128.8 
225.5 
318.5 
183.2 

92.4 
(') 
(') 

24.0 

129.4 

228.1 

325.3 

195.2 

108.3 

18.1 

17.8 

18.2 

16.7 

24  0 

1953 

0.7 
2.5 
6.8 
11.9 
15.9 
18.1 
17.8 
18.2 
16.7 

1.9 
10.6 
21.2 
59.6 

106.5 
98.4 
51.2 

144.2 
39.1 

1.9 

10.5 

20.9 

58.4 

'  102.  5 

'92.8 

M7.3 

■■  129.  2 

34.4 

(*) 

0.1 

'.3 

1.3 

3.9 

'5.6 

'3.9 

'15.0 

4.8 

1954  4            _ 

369  0 

1955 < 

673  1 

1956               -  --        

808  6 

1957     

810  4 

1958 

730  2 

1959      

696  9 

1960 

570  8 

1961     -.       - 

(*) 

548  4 

Total  through  June  30, 
1961 

972.4 

108.7 

1,081.1 

532.8 

497.8 

34.9 

548  4 

1960— July 

1.6 
1.3 
1.3 
1.2 
1.3 
1.5 
1.6 
1.3 
1.3 
1.2 
1.3 
1.6 

1.6 
1.3 
1.3 
1.2 
1.3 
1.5 
1.6 
1.3 
1.3 
1.2 
1.3 
1.6 

6.5 
5.7 
3.7 
3.4 
2.4 
2.4 
2.7 
1.9 
2.7 
2.4 
2.9 
2.5 

5.7 
5.0 
3.3 
3.0 
2.1 
2.1 
2.3 
1.7 
2.3 
2.1 
2.5 
2.2 

.8 
.7 
.4 
.4 
.3 
.3 
.3 
.2 
.3 
.3 
.4 
.3 

566  0 

August—-    -- 

561  6 

September -    .  .  _. 

(*) 

559.3 

October 

557  1 

November 

556.0 

December 

555  1 

554.1 

February 

553  4 

552.1 

April 

550.9 

549.3 

548.4 

Series  K 

1952 

85.9 
372.6 
599.2 
946.5 
403.1 
176.0 
(*) 
(*) 

85.9 
372.6 
599.2 
946.5 
403.1 
176.0 
(*) 
(*) 

85.9 

1953 

5.7 
20.3 
31.1 
79.5 
238.2 
257.7 
132.2 
365.8 
92.7 

5.7 

20.3 

31.1 

79.5 

238.2 

257.7 

132.2 

365.8 

92.7 

452.7 

1954* 

1,031.5 

1955  * 

1,947.0 

1956            - 

2,  270. 6 

1957 

2, 208.  5 

1958 

1, 950.  7 

1959 

1,818.6 

1960 

1,  452. 8 

1961 

1, 360. 1 

Total  through  June  30, 
1961  . 

2,  583. 3 

2.  583. 3 

1,  223.  2 

1, 223.  2 

1, 360. 1 

19eO_Julv 

17.2 
11.4 
8.0 
7.4 
6.1 
5.9 
6.8 
5.0 
6.5 
5.9 
6.6 
5.8 

17.2 
11.4 
8.0 
7.4 
6.1 
5  9 
6.8 
5.0 
6.5 
5.9 
6.6 
5.8 

1,435.5 

1,424.2 

1,416.2 

1,  408. 8 

1,  402.  7 

1,  396. 8 

19gl — January 

1,390.0 

1,384.9 

1, 378.  5 

April 

1, 372.  6 

1,  365.  9 

1, 360. 1 

*Less  than  $50,000. 

'  Revised. 

'  See  Note  to  table  43,  and  footnote  1. 

2  Sales  of  series  E,  F,  and  J  bonds  are  included  at  issue  price,  and  their  redemptions  and  amounts  out- 
standing at  current  redemption  value.  Series  Q,  H,  and  K  bonds  are  included  at  face  value  throughout. 
Matured  F  and  O  bonds  outstanding  are  included  in  the  interest-bearing  debt  until  all  bonds  of  the  annual 
series  have  matured,  when  thev  are  transferred  to  matured  debt  upon  which  interest  has  ceased. 

3  Because  there  is  a  normal  lag  in  classifying  redemptions  the  distribution  of  redemptions  between  orig- 
inal purchase  price  and  accrued  discount  has  been  estimated.  During  fiscal  1961  the  method  of  distributing 
redemptions  between  original  purchase  price  and  accrued  discount  was  changed  to  reflect  the  distribution 
shown  in  final  reports  of  classified  redemptions.   All  periods  shown  have  been  revised  on  this  basis. 

*  See  table  43,  footnote  3. 

Note.— Details  by  months  for  series  E,  F,  and  Q  bonds  from  May  1941  will  be  found  on  p.  608  of  the  1943 
annual  report,  and  in  corresponding  tables  in  subsequent  reports.  Monthly  detail  for  Series  H,  J,  and  K 
bonds  will  be  found  in  the  1952  annual  report,  pp.  629  and  630,  and  in  corresponding  tables  in  subsequent 
reports. 


614    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  45. — Sales  and  redemptions  of  Series  E  and  H  savings  bonds  by  denominations, 
fiscal  years  1941-61  and  monthly  1961  ' 

[In  thousands  of  pieces.    On  basis  of  daily  Treasury  statements  and  reports  from  Bureau  of  the  Public  Debt] 


Fiscal  year  or 
month 


Total,  all 
denomi- 
nations 2 


$25 


$50 


$100 


3  $200 


$1,000 


$5, 000 


s  $10,000 


1941-51 

1952 

1953 

1954  7 

1955 7 

1956 

1957 

1958 

19.59 

1960 

1961 

1960— July 

August 

September.. 

October 

November.. 
December. . 

1961 — January 

February... 
March... 

April 

May 

June 


Sales  6 


1941-51 

1952 

1953 

1951? 

1955  7 

1956 

1957 

1958 

1959 

1960 

1961 

1960— July 

August 

September. 

October 

November. 
December. 

1961— January 

February. _ 

March 

April 

May 

June 


371,227 

938, 127 

208,  207 

155,  894 

74, 136 

50,  701 

13, 129 

7,559 

80, 485 

54, 380 

14.372 

8.211 

85,  419 

56,  903 

15,  686 

8,810 

85. 342 

55. 164 

16.374 

9,315 

90, 053 

56.  719 

18,  784 

10, 090 

90, 160 

56.  327 

20,  256 

9,969 

89,  428 

54.  9^8 

21, 043 

9,824 

85,  882 

52. 895 

20, 108 

9.477 

85,  607 

52,  972 

20,  220 

9,208 

86,  495 

53,  453 

20,  434 

9,  273 

6,865 

4,264 

1,606 

729 

6,925 

4,267 

1,636 

753 

6,965 

4.303 

1,680 

742 

7,340 

4,638 

1,696 

763 

6,730 

4.160 

1,613 

720 

7,426 

4,706 

1,736 

747 

7,708 

4,727 

1,777 

834 

6,952 

4,182 

1,636 

790 

8,247 

5,080 

1,9,58 

883 

6,618 

4,030 

1,  ,592 

733 

7,275 

4,443 

1,770 

788 

7,444 

4,652 

1,736 

790 

5,545 
720 
794 
854 
884 
929 
851 
893 
798 
774 
789 
61 
63 
60 
62 
60 
61 
75 
72 
77 
63 


21,051 
948 
1,243 
1,411 
1,578 
1,608 
1,320 
1,303 
1,212 
1, 165 
1,201 


87 
89 
87 
86 
131 
122 
115 
93 
97 


21,  327 

1,076 

1,462 

1,708 

1,945 

1,854 

1.396 

1,411 

1,340 

1,230 

1,299 

103 

105 

90 

90 

86 

88 

1.57 

146 

128 

103 

104 


Redemptions  8 


WO,  537 

659,  947 

125.084 

76,  403 

51.649 

12,  662 

81,983 

56,  734 

13,  535 

90.  387 

62,  941 

15, 084 

89.  749 

61,049 

15,650 

89,  953 

60,014 

16.  503 

93. 175 

00,  612 

18, 165 

93,  452 

59, 880 

19,  467 

88,  647 

56, 036 

18,  598 

90,  748 

56,  796 

19, 507 

87,  935 

56, 140 

19,  279 

7,360 

4,682 

1,590 

7,215 

4,622 

1,,561 

7,420 

4,716 

1,662 

6.607 

4,222 

1,457 

7,884 

5,080 

1,733 

8.486 

5,572 

1,828 

7.295 

4,571 

1,578 

6.907 

4,458 

1,  475 

7,590 

4,818 

1,675 

6.872 

4,323 

1,542 

6,  931 

4.403 

1.  ,538 

7,368 

4,672 

1,642 

72, 022 

8,777 

8,840 

9,480 

9,914 

9,925 

10,  590 

10,  433 

10,  394 

10,  634 

9,489 

813 

784 

794 

704 

823 

835 

845 

734 

832 

766 

7,53 

805 


1,595 
371 
342 
357 
396 
537 
633 
639 
675 
725 
635 
55 
52 
51 
46 
53 
52 
59 
50 
55 
54 
52 
55 


7,921 

1,211 

1,112 

1,151 

1,210 

1.2,55 

1,354 

1.320 

1,301 

1,351 

1,105 

99 

92 

93 

83 

90 

92 

107 

86 

97 

87 


7,156 

1,291 

1,106 

1, 109 

1,177 

1.281 

1,485 

1,464 

1,451 

1.567 

1,170 

109 

93 

94 

86 

94 

99 

124 

94 

103 

92 

91 

94 


{*) 


(*) 


(*) 


(*) 
(*) 
(*) 
(*) 
(*) 
(*) 
(*) 
(*) 
(•) 
(*) 
(') 
(*) 


*Less  than  500  pieces. 

1  Sales  of  Series  H  began  on  June  1, 1952;  the  denominations  authorized  were  $509,  $1,000,  $5,000,  and  $10,000. 

2  Total  includes  $10  denomination  Series  E  bonds  sold  to  Armed  Forces  only  from  June  1944  through  Marcli 
19,50.  Details  by  years  will  be  found  in  the  1952  annual  report,  pp.  631,  633.  Thereafter  monthly  di^tail 
for  each  fiscal  year  appears  in  a  footnote  to  the  redemptions  by  denominations  table  of  successive  amiual 
reports.    Details  in  thousands  of  pieces  by  months  for  the  fiscal  year  1961  follow: 


July 

Aug. 

Sept. 

Oct. 

Nov. 

Dec. 

Jan. 

Feb. 

Mar. 

Apr. 

May 

June 

Total 

10 

10 

9 

8 

9 

9 

9 

9 

9 

8 

7 

7 

104 

'  Sale  of  $200  denomination  Series  E  bonds  began  in  October  1945. 
<  Sale  of  .$10,000  denomination  Series  E  bonds  was  authorized  on  May  1,  1952. 

« Includes  sales  of  $100,000  denomination   Series  E   bonds  which  are   purchasable  only  by  trustees  of 
employees'  savings  nlans  beginning  April  1954,  and  personal  trust  accounts  beginning  January  1955. 
8  See"  table  43,  footnote  1. 
■'See  table  43.  footnote  3. 


TABLES 


615 


Table  46. — Sales  of  Series  E  and  H  savings  bonds  by  States,  fiscal  years  1960, 

1961,  and  cumulative  i 

[In  thousands  of  dollars,  at  issue  price.    On  basis  of  reports  received  by  the  Treasury  Department,  with 
totals  adjusted  to  basis  of  daily  Treasury  statements] 


State 


Fiscal  year 
1960 


Fiscal  year 
1961 


May  1941- 
June  1961 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho 

IlUnois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada  

New  Hampshire 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Canal  Zone 

Puerto  Rico 

Virgin  Islands 

Adjustment  to  daily  Treasury  statement 

Total 


38, 
2, 

is: 

20, 

265, 

31 

61 

16, 

34 

61 

41 

10, 

7. 

332; 

124: 

136; 

74. 

51 

34, 

14 

54, 

104 

250, 

69, 

18, 

134, 

20 


160 
12, 

406, 
42, 
23 

273: 

56: 

31 

384, 

13: 

22, 

27, 

36, 

139, 

16, 

4, 

72: 

55 

47, 

91 

7, 

2 

1 

+241 


4, 307, 048 


38, 
3 

19, 
21 
271 
32, 
63, 
17 
34: 
71 
39, 
10 
7, 
353 
124, 
137 
78, 
50, 
34, 
15, 
56, 
107, 
254: 
72: 

18: 

136 
19, 


169 
12, 

439 
41 
20 

281 
58, 
30 

390, 
14 
22: 
27, 
35 

141 
17, 
4, 
72, 
56, 


+276, 


4, 463,  728 


3+2, 


047, 048 
2  43, 335 
385, 330 
630, 858 
355, 006 
812,551 
655,  538 
270, 281 
135, 720 
343,  760 
169, 247 
414, 865 
269. 301 
685, 351 
993,  748 
968, 289 
749, 547 

173. 956 
032, 342 
407, 480 

314. 957 
004, 772 
872, 362 
056, 876 
617, 768 
978, 706 
537, 027 
686. 057 
125, 960 
249, 349 
959, 006 
256, 912 
869, 440 
198. 765 
538,  788 
653, 266 
315,  746 
039, 646 
675, 643 
476, 005 
611,543 
650, 128 
114, 820 
806, 870 
413, 105 
137, 098 
745, 591 
767, 161 
072,012 
420, 655 
209, 103 

63, 495 

58, 905 

2,914 

979,311 


107, 023, 315 


1  Figures  Include  exchanges  of  minor  amounts  of  Series  F  and  J  bonds  for  Series  H  bonds  beginning  January 
1960;  however,  they  exclude  exchanges  of  Series  E  bonds  for  Series  H  bonds,  which  are  reported  in  table  44. 

2  Excludes  data  for  period  April  1947  through  December  1956,  when  reports  we.'e  not  available.  In  the 
annual  i-eports  for  1952-1958  data  for  period  May  1941  through  March  1947  were  included  with  "Other 
possessions." 

3  Includes  a  small  amount  for  other  possessions. 

Note.— Sales  by  States  of  the  various  series  of  savings  bonds  were  published  in  the  annual  report  for 
1943,  pp.  614-621,  and  m  subsequent  reports;  and  by  months  at  intervals  in  the  Treasury  Bulletin,  beginning 
with  the  i'sue  of  July  1946.  Since  April  30,  1953,  figures  for  sales  of  Series  E  and  H  bonds  only  have  been 
available  by  States. 


616 


1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


IV. — Interest 

Table  47. — Amount  of  interest-bearing  'public  debt  outstanding,  the  computed  annual 
interest  charge,  and  the  computed  rate  of  interest,  June  30,  1916-61 ,  and  at  the  end 
of  each  month  during  1961  ' 

[On  basis  of  Public  Debt  accounts  through  June  1937,  and  subsequently  on  basis  of  daily  Treasury 
statements,  see  "Bases  of  Tables"] 


End  of  fiscal  year  or  month 


Interest-bearing 
debt  2 


Computed  an- 
nual interest 
charge ' 


Computed 
rate  of 
interest  ^ 


June  30— 

1916 

1917 

1918 

1919 

1920 

1921 

1922 

1923 

1924 

1925 

1926 

1927 

1928 

1929 

1930 

1931 

1932 

1933 

1934 

1935 

1936 

1937 

1938 

1939 

1940 

1941 

1942 

1943 

1944 

1945 

1946 

1947 

1948 

1949 

1950 

1951 

1952 

1953 

1954 

1955 

1956 

1957 

1958 

Footnotes  at  end  of  table 


$971, 
2,  712, 
11,985, 
25, 234, 
24,061, 
23,  737, 
22,711, 
22, 007, 
20. 981, 
20,210, 
19,383, 
18, 250, 
17,317, 
16, 638, 
15,921, 
16,  519, 
19, 161, 
22, 157, 
26, 480, 
27, 645, 
32,  755, 
35, 802, 
36,  575, 
39, 885, 
42, 376, 
48, 387, 
71,968, 
135, 380, 
199,  543, 
256, 356, 
268,110, 
255,113, 
250, 063, 
250,  761, 
255, 209, 
252,851, 
256, 862, 
263, 946, 
268,  909, 
271,  741, 
269, 883, 
268, 485, 
274, 697, 


562,  590 
549, 476 
882, 436 
496, 273 
095,361 
352, 080 
035,  587 
590,  754 
586, 429 
906, 251 
770, 860 
943, 965 
695, 096 
941,379 
892, 350 
588, 640 
273,  540 
643, 120 
487, 920 
229, 826 
631,  770 
586,915 
925, 880 
969, 732 
495, 928 
399,  539 
418, 098 
305,  795 
355,301 
615,818 
872,  218 
412,039 
348, 379 
636,  723 
353. 372 
765, 497 
861, 128 
017,740 
766,  654 
267,  507 
068, 041 
562,  677 
560, 009 


$23, 

83, 

468, 

1, 054, 

1,016, 

1, 029, 

962, 

927, 

876, 

829, 

793. 

722, 

671, 

656, 

606. 

588, 

071, 

742, 

842, 

750, 

838, 

924, 

947, 

1,036. 

1, 094, 

1.218, 

1,644, 

2, 678, 

3, 849, 

4, 963, 

5. 350, 

5, 374, 

5, 455, 

5, 605, 

5,  612, 

5,  739, 

5,981, 

6, 430, 

6, 298, 

6, 387, 

6, 949, 

7, 325, 

7, 245, 


084, 635 
625,  482 
618,544 
204, 509 
592, 219 
917, 903 
896, 535 
331,341 
960, 673 
680, 044 
423, 952 
675, 553 
353, 1 12 
654,311 
031,831 
987, 438 
604,  676 
175,  955 
301, 133 
677,  802 
002, 053 
347, 089 
084, 058 
937, 397 
619,914 
238, 845 
476, 360 
779, 036 
254, 656 
730, 414 
772,231 
409, 074 
475,  791 
929,  714 
676,516 
615,990 
357,116 
991,316 
069, 299 
225, 600 
699, 625 
146, 596 
154, 946 


Percent 
2.376 
3.120 
3.910 
4.178 
4.225 
4.339 
4.240 
4.214 
4.180 
4.105 
4.093 
3.960 
3.877 
3.946 
3.807 
3.566 
3.505 
3.350 
3.181 
2.716 
2.559 
2.582 
2.589 
2.600 
2.583 
2.518 
2.285 
1.979 
1.929 
1.936 
1.996 
2.107 
2.182 
2.236 
2.200 
2.270 
2.329 
2.438 
2.342 
2.351 
2.576 
2.730 
2.638 


I 


TABLES 


617 


Table  47. — Amount  of  interest-bearing  public  debt  outstanding,  the  computed  annual 
interest  charge,  and  the  computed  rate  of  interest,  June  SO,  1916-61 ,  and  at  the  end 
of  each  month  during  1961  ^ — Continued 


End  of  fiscal  year  or  month 


Interest-bearing 
debt  2 


Computed  an- 
nual interest 
charge ' 


Computed 

rate  of 

interest ' 


June  30— 

1959 

1960 

1961 

End  of  month — 

1960— July 

August 

September 

October 

November. 

December. 

1961— January... 

February. . 

March 

April 

May 

June 


$281,833, 
283,241, 
285, 671, 

285, 285, 
285, 634, 
285, 358, 
287,371, 
287  138, 
286, 820, 
286, 650, 
287, 189, 
284, 057, 
284, 630, 
286, 845, 
285, 671, 


362, 429 
182,  755 
608, 619 

151,179 
463,  460 
494, 255 
939, 597 
324, 233 
451,049 
774, 875 
569, 632 
855, 261 
816, 851 
316, 709 
608, 619 


$8,065,917,424 
9,316,066,872 
8, 761, 495, 974 


9, 277, 
9, 059, 
9, 026, 
9, 079, 
9, 003, 
8, 976, 
8,919, 
8, 828, 
8, 814, 
8,  782, 
8, 804, 
8, 761, 


550, 437 
850, 810 
869, 130 
920, 939 
298, 299 
406, 053 
768, 387 
082,  759 
949, 939 
432, 272 
566, 276 
495, 974 


Percent 
2.867 
3.297 
3.072 

3.260 
3.179 
3.171 
3.167 
3.143 
3.137 
3.118 
3.081 
3.109 
3.091 
3.075 
3.072 


1  Comparable  monthly  data  1929-36  appear  in  1936  annual  report,  p.  442,  and  from  1937  in  later  reports. 
Annual  interest  charge  monthly  1916-29  appears  in  1929  annual  report,  p.  509. 

•  Includes  discount  on  Treasury  bills  from  June  30,  1930;  the  current  redemption  value  from  May  1935 
of  savings  bonds  of  Series  A-F  and  J;  and  beginning  August  1941,  the  face  amount  of  Treasury  tax  and 
savings  notes.  The  face  value  of  matured  savings  bonds  and  notes  outstanding  is  included  until  aU  of  the 
annual  series  have  matured,  when  they  are  transferred  to  matured  debt  on  which  interest  has  ceased. 

3  For  methods  of  computing  annual  interest  charge  and  rate  see  note  to  following  table.  For  computa- 
tions on  Treasury  bills  and  savings  bonds,  see  footnotes  3  and  4  to  following  table. 


618   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  49. — Interest  on  the  -public  debt  by  security  classes,  fiscal  years  1957-61  ^ 
[In  millions  of  dollars.    On  basis  of  Public  Debt  accounts,  see  "Bases  of  Tables"] 


Class  of  security 

1957 

1958 

1959 

1960 

1961 

Public  issues: 

Marketable  obligations: 

Treasury  bills  2             .      .      _        ..  .    .. 

704.5 

574.2 

811.0 

2,011.4 

1.5 

738.4 
1,143.8 

600.8 

2,097.4 

1.5 

734.2 

915.3 

741.0 

2, 229. 1 

1.5 

1,572.0 

783.8 

1,703.4 

2,223.2 

1.5 

1, 108.  7 

712.3 

1,951.8 

Treasury  bonds                        --          

2, 214. 1 

Others  3           .      ...      

1.4 

Total  marketable  obligations  ..... 

4, 102.  6 

4,581.9 

4,  621. 1 

6,283.9 

5, 988. 3 

Nonmarketable  obligations: 

United  States  savings  bonds: 

Series  E,  F,  and  J  2 

1,216.9 

365.  3 

5.3 

1,218.2 

308. 1 

3.3 

1,232.0 

296.1 

4.0 

1,  246. 0 

257.0 

3.6 

1,  285. 8 

Series  G,  11,  and  K             .             . 

261.1 

Depositary  bonds            

2.6 

Treasury  bonds,  R.  E.  A.  series..  .. 

.2 

Treasury  bonds.  Investment  series 

313.4 
(*) 

272.3 

242.2 
(*) 

196.0 
C) 

169.1 

Others  *                            .    .  

Total  nonmarketable  obligations     ..  . 

1, 900. 9 

1,801.9 

1,  774. 3 

1,  702. 6 

1,718.8 

6, 003.  5 

6,383.8 

6,  395. 4 

7,  986.  5 

7,  707. 1 

Special  issues: 

935.1 
305.6 

778.0 
358.4 
86.6 

592.1 
431.9 
173.4 

244.8 
373.4 
574.9 

243.6 

Treasury  notes                                        ... 

265.7 

Treasury  bonds                         .  

740.8 

Total  special  issues                                   .  . 

1, 240.  7 

1,223.0 

1, 197. 4 

1, 193. 1 

1, 250. 1 

7, 244. 2 

7, 606. 8 

7,  592. 8 

9, 179. 6 

8, 957. 2 

♦Less  than  $5, 000. 

1  On  an  accrual  basis. 

2  Amounts  represent  discount  treated  as  interest. 

3  Includes  postal  savings  bonds,  Liberty  bonds,  Victory  notes,  and  Pimama  Canal  bonds. 

*  Includes  Treasury  tax  and  savings  notes,  Armed  Forces  leave  bonds,  and  adjusted  service  bonds. 


TABLES 


621 


Table  50. — Interest  on  the  public  debt  and  guaranteed  obligations  by  tax  status, 

fiscal  years  1940-61  ' 

[In  millions  of  dollars.    On  basis  of  Public  Debt  accounts,  see  "Bases  of  Tables"] 


Fiscal  year 


Total 


Tax-exempt 


Total       Wholly    Partially 


Taxable 


Special 
issues  to 
Qovem- 

ment  agen- 
cies and 

trust  funds 


Issued  by  U.  S.  Qovemment 


1940 
1941. 
1942 
1943. 
1944. 
1945 
1946. 
1947. 
1948 
1949 
1950 
1951 
1952 
1953 
1954 
1955 
1956 
1957. 
1958 
1959 
1960 
1961 


1940. 
1941. 
1942. 
1943. 
1944. 
1945. 
1946. 
1947. 
1948. 
1949. 
1950. 
1951. 
1952. 
1953. 
1954. 
1955. 
1956 
1957. 
1958 
1959 
1960. 
1961 


1,041.4 

909.6 
950.1 

104.2 
79.2 

805.4 
870.9 

1,110.2 

0.5 

1, 260. 1 

907.2 

57.1 

850.1 

153.5 

1,813.0 

895.6 

38.3 

857.4 

676.1 

2. 610. 1 

852.2 

27.2 

825.0 

1,449.8 

3, 621. 9 

780.2 

45.3 

734.9 

2,  436. 3 

4, 747. 5 

711.9 

26.0 

685.9 

3, 530. 8 

4.958.0 

601.0 

7.0 

594.0 

3, 755. 1 

5, 187. 8 

574.8 

5.6 

569.2 

3,884.9 

5, 352.  3 

494.5 

5.1 

489.4 

4, 040. 3 

5,  496. 3 

416.7 

4.3 

412.4 

4,218.8 

5,  615. 1 

329.9 

4.2 

325.7 

4,413.0 

5, 853. 0 

226.0 

4.1 

221.9 

4,  686  9 

6,  503. 6 

201.7 

3.7 

198.0 

5, 258. 4 

6, 382. 5 

183.9 

3.1 

180.8 

5, 071. 0 

6,  370. 4 

148.6 

2.2 

146.4 

5, 107. 1 

6, 786.  6 

94.6 

1.6 

93.1 

5, 553. 6 

7,  244.  2 

73.3 

1.5 

71.8 

5,  930. 2 

7, 606. 8 

66.6 

1.5 

65.1 

6,317.2 

7,  592.  8 

42.3 

1.5 

40.8 

6,  353. 1 

9. 179. 6 

42.3 

1.5 

40.8 

7, 944. 2 

8,  957.  2 

42.2 

1.4 

40.8 

7, 664. 9 

131.8 
159.6 
199.4 
241.3 
308.2 
405.4 
504.8 
601.9 
728.1 
817.5 
860.8 
872.2 
940.1 

1. 043. 5 

1. 127. 6 
1,114.7 
1, 138. 4 
1,  240. 7 
1,223.0 
1,197.4 
1, 193. 1 
1, 250. 1 


Issued  by  Federal  instrumentalities:  Guaranteed  issues 


109.9 

110.9 

125.6 

82.0 

77.9 

18.0 

1.6 

1.6 

1.1 

.7 

.5 

1.1 

1.8 

2.4 

2.2 

2.1 

2.5 

3.8 

4.0 

4.9 

5.0 

8.3 


109. 

110. 

113. 

66. 

65. 

13. 

1. 

1. 

1. 


109.9 

110.9 

113.0 

66.6 

65.7 

13.2 

1.6 

1.6 

1.1 

.4 

.3 

.3 

.4 

.3 

.2 

.2 

.2 

.2 

.2 

.1 

.1 

.9 


12.6 

15.4 

12.2 

4.8 

(•) 

(•) 

(•) 

.2 

.1 

.8 

1.4 

2.1 

2.0 

1.9 

2.3 

3.6 

3.8 

4.8 

4.9 

7.4 


•Less  than  $50,000. 

>  Figures  for  1940  to  1949,  inclusive,  represent  actual  interest  payments;  figures  for  1950  to  1954,  inclusive, 
represent  interest  which  became  due  and  payable  during  those  years  without  regard  to  actual  payments; 
figures  for  195S  to  1961,  inclusive,  are  shown  on  an  accrual  basis. 

Note.— Amount  of  interest  paid  includes  increase  in  redemption  value  of  United  States  savings  bonds 
and  discount  on  unmatured  issues  of  Treasury  bills.  Interest  paid  on  guaranteed  issues  does  not  include 
amounts  paid  on  demand  obligations  of  Commodity  Credit  Corporation.  Data  for  1913-33  will  be  found 
in  the  1948  annual  report,  p.  539,  and  for  1934-39  in  the  1952  annual  report,  p.  645. 


622   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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TABLES 


625 


VI. — Ownership  of  gOTernmental  securities 

Table  53. — Estimated  ownership  of  interest-bearing  governmental  securities  out- 
standing June  SO,  1962-61,  by  type  of  issuer 

(Par  value.!    in  billions  of  dollars] 


Total 

Held  by  banks 

Held  by 

U.S. 
Qovem- 

Held  by  private  nonbank  Investors 

June 

amount 

ment 

State, 

30 

out- 

Com- 

Federa 

invest- 

Indi- 

Insur- 

Mutual 

local, 

Miscel- 

stand- 

Tota 

mer- 

Reserve 

ment 

Total 

vid- 

ance 

sav- 

Corpo- 

and ter- 

laneous 

ing 

cial 
banks 

Banks 

ac- 
counts 

uals' 

com- 
panies 

ings 
banks 

rations  ' 

ritorial 
govern- 

inves- 
tors* 

ments  * 

I.  Securities  of  U.  S.  Government  and  Federal  instrumentalities  guaranteed  by  United  States  « 

1952... 

256.9 

84.0 

61.1 

22.9 

44.3 

128.5 

63.8 

15.7 

9.6 

18.8 

10.4 

10.3 

1953... 

264.0 

83.6 

58.8 

24.7 

47.6 

132.9 

65.3 

16.0 

9.5 

18.6 

12.0 

11.5 

1954... 

269.0 

88.7 

63.6 

25.0 

49.3 

131.0 

63.7 

15.4 

9.1 

16.6 

13.9 

12.2 

1955... 

271.8 

87.1 

63.5 

23.6 

50.5 

134.1 

64.0 

15.0 

8.7 

18.8 

14.7 

12.8 

1956— 

270.0 

81.0 

57.3 

23.8 

53.5 

135.4 

'65.1 

13.6 

8.4 

17.7 

'10.1 

14.6 

1957-.. 

268.6 

79.2 

56.2 

23.0 

55.6 

133.8 

64.0 

12.7 

7.9 

10.8 

'  10.8 

14.9 

1958-.. 

274.8 

90.7 

65.3 

25.4 

55.9 

128.2 

■62.7 

12.2 

7.4 

'14.8 

'16.3 

14.7 

I959-.. 

281.9 

87.6 

61.5 

26.0 

54.6 

139.7 

'  64.  6 

■■12.6 

7.3 

'20.7 

'16.9 

17.7 

1900... 

283.4 

■■81.8 

■■55.3 

26.5 

55.3 

■■  146.  2 

'  67.  6 

'12.0 

6.6 

'20.7 

'18.8 

'20.4 

1961... 

285.9 

89.8 

62.5 

27.3 

56.1 

140.0 

03.6 

11.4 

0.3 

19.4 

18.7 

20.6 

II.  Securities  of  Federal  instrumentalities  not  guaranteed  by  United  States  ' 

1952... 

1.2 

.7 

.7 

(*) 

.5 

.3 

(*) 

(*) 

.1 

(*) 

(*) 

1953... 

1.1 

.6 

.6 

(') 

.5 

.3 

(*) 

(*) 

.1 

(*; 

(*) 

1954... 

1.0 

.5 

.5 

(*) 

.5 

.3 

(*) 

(*) 

.1 

(•) 

(*) 

1955... 

1.8 

.9 

.9 

(*) 

.9 

.4 

(♦) 

(*; 

.4 

(*) 

(*) 

1956... 

2.6 

.9 

.9 

(*) 

1.6 

.6 

.1 

.1 

.7 

(*) 

.1 

1957... 

3.5 

1.0 

1.0 

(') 

2.4 

.9 

.1 

.2 

1.0 

(*) 

.2 

1958... 

3.8 

1.4 

1.4 

(*) 

2.4 

.8 

.1 

.2 

1.0 

.1 

.2 

1959... 

4.8 

1.2 

1.2 

(*) 

3.6 

1.2 

.1 

.3 

1.3 

.2 

.5 

1960... 

6.3 

1.1 

1.1 

(*) 

5.2 

1.7 

.2 

.4 

1.6 

.3 

1.0 

1961... 

5.4 

1.2 

1.2 

(*) 

4.2 

1.1 

.2 

.3 

1.5 

.4 

.7 

III.  Securities  of  State  and  local  governments,  Territories,  and  possessions  • 

1952... 

29.3 

9.9 

9.9 

.7 

18.7 

10.5 

2.8 

.2 

.6 

3.9 

.6 

1953... 

32.3 

10.6 

10.7 

.7 

21.0 

11.6 

3.5 

.4 

.7 

4.2 

.6 

1954... 

37.4 

12.0 

12.0 

.3 

25.1 

13.8 

4.6 

.5 

.9 

4.5 

.7 

1955... 

42.8 

12.8 

12.8 

.3 

29.7 

16.4 

5.8 

.7 

1.1 

4.9 

.8 

1956... 

47.6 

13.0 

13.0 

.2 

34.5 

19.5 

6.6 

.7 

1.4 

5.3 

.9 

1957... 

52.1 

13.4 

13.4 

.2 

38.4 

22.0 

7.4 

.7 

1.5 

5.8 

1.0 

1958... 

56.8 

15.8 

15.8 

.3 

40.7 

22.8 

8.2 

.7 

1.5 

6.4 

1.1 

1959... 

62.0 

17.0 

17.0 

.3 

44.6 

24.6 

9.5 

.7 

1.7 

6.8 

1.3 

1960... 

66.4 

16.8 

16.8 

.3 

49.2 

27.2 

10.9 

.7 

1.9 

7.1 

1.5 

1961... 

71.7 

18.8 

18.8 

.4 

52.5 

28.3 

12.3 

.7 

2.2 

7.4 

1.6 

•Less  than  $50  million. 
» Revised. 

1  Except  data  including  U.S.  savings  bonds  of  Series  A-F  and  J,  which  are  on  the  basis  of  current  redemp- 
tion value. 
3  Includes  partnerships  and  personal  trust  accounts. 

•  Exclusive  of  banks  and  insurance  companies. 

•  Comprises  trust,  sinking,  and  investment  funds  of  State  and  local  governments.  Territories,  and  pos- 
sessions. 

» Includes  savings  and  loan  associations,  nonprofit  associations,  corporate  pension  trust  funds,  dealers  and 
brokers,  and  investments  of  foreign  balances  and  international  accounts  in  this  country. 

•  On  daily  Treasury  statement  basis.  Since  noninterest-bearing  debt  is  excluded  the  figures  differ  slightly 
from  those  in  discussion  of  debt  o-wnership.  Special  issues  to  Federal  agencies  and  trust  funds  are  included 
and  guaranteed  securities  held  by  the  Treasury  are  excluded. 

'  See  table  54,  footnote  4. 

9  Excludes  obligations  of  Puerto  Rico  after  June  30, 1952. 

Note.— For  data  from  1937  through  1951,  see  the  1952  annual  report,  pp.  764  and  765. 


626   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  54. — Estimated  distribution  of  interest-hearing  governmental  securities  out- 
standing June  30,  1952-61,  by  tax  status  and  type  of  issuer  i 

[Par  value.'    In  millions  of  dollars] 


Securities  of  U.S.  Government  and  Federal 
instrumentalities  guaranteed  by  U.S.3 

Securities  of  Federal  instru- 
mentalities not  guaran- 
teed by  U.S.* 

Securities  of  State,  local, 
and  territorial  govern- 
ments 

June  30 

Total 

Tax-e.xempt 

Tax- 
able' 

Special 
issues  s 

Total 

Tax-exempt 

Tax- 
able' 

Wholly  tax-exempt  5 

Wholly 

Par- 
tially 8 

Wholly 

Par- 
tially 

Total 

Issues 

of 
States 

and 
loc.ili- 

ties 

Issues 
of  Ter- 
rito7ies 

and 
posses- 
sions ' 

I.  Total  amount  outstanding 

1952    .  . 

256, 907 
263, 997 
268,  990 
271,  785 
269, 956 
268, 592 
274, 798 
281,944 
283.  380 
285,911 

142 
124 
96 
71 
50 
50 
60 
50 
50 

7,402 
6,678 
5,997 
3.386 
3,386 
2,404 
1,485 
1,485 
1,485 
1,485 

211,623 
216, 657 
220,  668 
225, 078 
221,406 
219,311 
227, 017 
235,  653 
236. 946 
239, 383 

37, 739 

40, 538 

42.  229 

43,  250 
45. 114 
46. 827 
46, 246 
44, 756 
44.899 
45, 043 

1,220 
1,142 
960 
1,815 
2,567 
3,464 
3,777 
4,820 
6,270 
5,408 

1.220 
1,142 
960 
1,815 
2,567 
3,464 
3,777 
4,820 
6,270 
5, 408 

29,  279 
32,  339 
37,  448 
42,  763 
47, 586 
52, 081 
56, 790 
61, 985 
66. 425 
71, 730 

29,111 
32,  200 
37, 300 
42, 600 
47, 400 
51,840 
56, 500 
61, 675 
66.425 
71, 730 

168 

1953 

139 

1954 

148 

1955      . 

163 

1956 

186 

1957 

241 

1958      . 

290 

1959      .. 

310 

1960 

1961 

II. 

Held  by  U.S.  Government  investment  accounts 

1952 

44, 335 
47, 560 
49, 339 
50, 540 
53,  495 
55, 551 
55, 895 
54,616 
55,  337 
56, 088 

31 
23 
13 

4 
(*) 

86 

26 

12 

4 

2 

6,480 
6,972 
7,086 
7,282 
8,379 
8,724 
9,649 
9,861 
10, 438 
11,045 

37, 739 

40,  538 
42, 229 

43.  250 
45, 114 
46, 827 
46, 246 

44,  756 
44, 899 
45, 043 

4 
20 

8 

8 
13 
18 
25 

6 
12 
13 

4 
20 

8 

8 
13 
18 
25 

6 
12 
13 

733 
733 
332 

255 
227 
243 
271 
310 
349 
403 

730 
715 
329 
250 
220 
237 
264 
304 
349 
403 

2 

1953      - 

18 

1954 

3 

1955 

5 

1956 

7 

1957      .. 

6 

1958 

7 

19,59 

6 

19fi0 

1961 

III.  Held  by  Federal  Reserve  Banks 

1952 

22. 906 
24, 746 
25, 037 
23, 607 
23.  758 
23, 035 
25, 438 
26, 044 
26, 523 
27, 253 

22, 906 
24,746 
25. 037 
23, 607 
23. 758 
23,  035 
25. 438 
26, 044 
26.523 
27, 253 

1953 

1954      . 

1955 

1956 

1957 

1958 

1959 

1960     . 

1961 

Footnotes  at  end  of  table. 


TABLES 


627 


Table  54. — Estimated  distribution  of  interest-hearing  governmental  securities  out- 
standing June  SO,  1952-61,  by  tax  status  and  type  of  issuer  ' — Continued 

[Par  value.2    In  millions  of  dollars] 


Secnritiesof  U.S.  Governmont  and  Federal 
instrumentalities  guaranteed  by  U.S.' 

Securities  of  Federal  inst  ru- 
mentalities  not  guaran- 
teed by  U.S.* 

Securities  of  State,  local, 
and  territorial  govern- 
ments 

June  30 

Total 

Tax-exempt 

Tax- 
able' 

Special 
issues » 

Total 

Tax-exempt 

Tax- 
able' 

Wholly  tax-exempt  > 

Wholly 

Par- 
tially 6 

Wholly 
(>) 

Par- 
tially 
(«) 

Total 

Issues 
of 

States 
and 

locali- 
ties 

Issues 
of  Ter- 
ritories 

and 
posses- 
sions • 

IV.  Held  by  State  and  local  governments,  Territories,  and  possessions 

1952 

10, 357 
-■  12,025 

13,  930 

14,  731 
'  16. 130 
-■  16, 825 
-•16,285 
r  16, 865 
-•  18, 832 

18,  700 

n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 

n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 

3,879 
4,190 
4,536 
4,865 
5,322 
5,821 
6,358 
6,828 
7,100 
7,350 

3,852 
4,176 
4,523 
4,850 
5,300 
5,800 
6,330 
6,800 
7,100 
7,350 

27 

1953 

14 

1954 

13 

1955 

15 

1956 

19 

1957 

21 

1958 

28 

1959 

28 

1960 

1961 

V.  Privately  held  securities 

1952 

179, 309 
'  179, 666 

180, 684 
-■  182, 907 
r  176, 573 
r 173, 181 
r  177, 180 
'  184, 419 
-■  182, 688 

183, 870 

112 
100 
83 
67 
50 
50 
50 
50 
50 

n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 

n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 
n.a. 

1,216 
1.122 
952 
1,807 
2.554 
3.446 
3.752 
4,814 
6,  258 
5,395 

1,216 
1,122 
952 
1,807 
2,554 
3,446 
3,752 
4,814 
6. 258 
5,395 

24,668 
27,416 
32, 580 
37, 643 

42, 040 
46, 017 
50, 161 
54, 847 
58.  976 
63,  977 

24.529 
27, 309 
32,  448 
37. 500 

41, 880 
45, 803 
49, 906 
54,571 
58.  976 
63, 977 

139 

1953 

107 

1954 

132 

1955 

143 

1956 

160 

1957 

214 

1958 

255 

1959 

276 

1960 

1961 

*Less  than  $500,000.       n.a.  Not  available.       ■■  Revised. 

•  The  "total  amount  outstanding"  of  securities  of  the  several  issuers  differs  from  the  gross  indebtedness 
of  these  issuers  as  the  former  excludes  noninterest-bearing  debt.  The  "total  privately  held  securities" 
diSers  from  the  net  indebtedness  of  the  borrowers  in  several  additional  respects.  The  former  is  derived  by 
deducting  from  the  total  amount  of  interest-bearing  securities  outstanding  the  amount  of  such  securities 
held  by  Federal  agencies,  Federal  Reserve  Banks,  and  by  public  sinking,  trust,  and  investment  funds. 
Net  indebtedness,  on  the  other  hand,  is  derived  by  deducting  from  the  gross  indebtedness  an  amotmt 
equivalent  to  the  total  volume  of  sinking  fund  assets  of  the  respective  borrowers,  but  makes  no  allowance 
for  any  other  public  assets. 

2  When  included,  U.S.  savings  bonds  Series  A-F,  and  J  are  at  current  redemption  value. 

3  On  basis  of  daily  Treasury  statements.    Excludes  guaranteed  securities  held  by  the  Treasury. 

*  Excludes  stocks  and  interagency  loans. 

5  Income  is  exempt  from  both  the  normal  rates  and  surtax  rates  of  the  Federal  income  tax. 
9  Income  is  exempt  only  from  the  normal  rates  of  the  Federal  income  tax.    Interest  derived  from  $5,000 
aggregate  principal  amount  owned  by  any  one  holder  is  exempt  from  the  surtax  rates  as  well. 
'  Income  is  subject  to  both  the  normal  and  the  surtax  rates  of  the  Federal  income  tax. 
'  Special  issues  to  Federal  agencies  and  trust  funds. 
9  Excludes  obligations  of  Puerto  Rico  after  June  30, 1952. 

Note.— For  data  back  to  1913,  see  1946  annual  report,  p.  664,  1949  annual  report,  p.  591,  and  1958  annual 
report,  p.  574. 


628 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  55. — Summary  of  Treasury  survey  of  ownership  of  interest- 

[Par  value.    In 


Total  amount 
outstanding 

Held  by  Investors  covered 

Commercial 
banks  -  3 

Mutual 
savings 
banks  - 

Insurance  companies 

Classification 

Life 

Fire,  casu- 
alty, and 
marine 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

Number  of  institutions  or  funds. 

6,362 

6,279 

513 

512 

307 

307 

531 

521 

Type  of  Security 

Public  marketable: 
Treasury  bills: 

Regular  weeklv         -  -.. 

25,  903 

28,  715 
1,503 
6,505 
13,338 
56, 257 
80, 830 

240 

1,595 

'""780' 

1,832 

15,598 

28, 185 

14 

7 

4,  655 
291 
1,433 
3,123 
18,373 
27,158 

123 

""'86' 

166 

1.199 

4.607 

146 
2 

80 

102 

1.343 

4,324 

56 

""76" 

50 

180 

4,223 

72 

18 

9 

21 

321 

4.187 

73 

"""33' 

115 

1,045 

3,080 

2 

2 

103 

1 

38 

80 
1,025 

2,877 

4 

Tax  anticipation 

Other     .     

7.512 

17,650 

51,483 

81,247 

50 

139 

Certificates  of  indebtedness.. 

Panama  Canal  bonds 

Guaranteed  obligations  held 
outside  the  Treasury 

41 

21 

31 

14 

19 

Total  public  marketable... 

183, 985 

187,388 

48.  Oil 

55, 073 

6,202 

6,027 

4,593 

4,647 

4,349 

4,129 

Public  nonmarketable: 

47,  544 
170 

47,514 
117 

19 
5,830 

231 
'170 

166 

ni7 

46 

27 

39 

21 

87 

59 

Depositary  bonds 

Treasury  bonds: 

Investment  series 

6,783 

205 

191 

327 

236 

1,616 

1,318 

120 

100 

Total  public  nonmar- 
ketable  

54,  497 
44,  899 

53,  481 
45, 043 

606 

474 

373 

264 

1,654 

1,339 

207 

159 

283, 380 

285,911 

48,617 

55,  548 

6,575 

6,291 

6,247 

5,986 

4,555 

4,288 

Maturity  Classes  « 
Public  marketable: 

70,  467 
72, 844 
20,  246 
11.  746 

884 
7,  658 

139 

81,120 
58, 400 
26.  435 
8,706 
1,527 
10,  960 
240 

7,835 

33,  342 

4,677 

1,658 

30 

463 

7 

21,473 

24,  256 

7,386 

1,454 

98 

366 

41 

463 

1,720 

2,662 

804 

46 

487 

21 

726 

1,412 

2,289 

463 

106 

1,001 

31 

193 

404 
2,087 
1,043 
103 
748 
14 

244 
318 

1,953 
299 
221 

1.592 
19 

438 

2,389 

940 

381 

26 

174 

2 

892 

1,526 

1,160 

285 

50 

211 

4 

1  to  5  years 

5  to  10  years 

15  to  20  years    .. 

Guaranteed  obligations 

Total  public  marketable... 

183,  985 

187,  388 

48,  Oil 

55, 073 

8,202 

6,027 

4,593 

4,647 

4.349 

4,129 

*Less  than  $500,000. 

1  Banks  and  insurance  companies  covered  in  the  Treasury  survey  of  ownership  of  securities  issued  or  guar- 
anteed by  the  U.S.  Government  account  for  approximately  95  percent  of  the  amount  of  such  securities 
owned  by  all  banks  and  insurance  companies  in  the  United  States.  The  savings  and  loan  associations  and 
corporations  which  were  added  to  the  survey  in  1960  account  for  about  half  of  the  Federal  securities  held 
by  these  investor  classes.  Details  as  to  the  ownership  of  each  security  are  available  in  the  Treasury  Bul- 
letin monthly  for  the  above  investors  and  semiannually  for  commercial  banks  classified  by  membership 
in  the  Federal  Reserve  System. 

2  Securities  held  in  trust  departments  are  excluded. 

3  Includes  trust  companies  and  stock  savings  banks. 

*  Included  with  all  other  investors  are  those  banks,  insurance  companies,  savings  and  loan  associations, 
and  corporations  not  reporting  in  the  Treasury  survey. 

'  Consists  of  corporate  pension  trust  funds  and  profit-sharing  plans  which  involve  retirement  benefits. 
Quarterly  data  are  presented  in  the  Treasury  Bulletin  as  supplemental  information  in  a  memorandum 


TABLES 


629 


bearing  public  debt  and  guaranteed  obligations,  June  30,  1960  and  1961 
millions  of  dollars] 


in  Treasury  survey  i 

Held  by  all  other 
investors  * 

Savings  and  loan 
associations 

Corporations 

U.S.  Government 
investment  ac- 
counts and  Fed- 
eral Reserve  Banks 

Memorandum: 
Held  by  corporate 
pension  trust  funds ' 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

June 
30, 
1960 

June 
30, 
1961 

491 

489 

499 

489 

12, 088 

12, 926 

102 

74 

3,829 

3,651 

598 

635 

754 

2.227 

2,177 

2,311 

2,716 
21 
904 
6,733 
15. 879 
9.503 

17, 813 

17,  299 
572 
3.368 
2,488 
16.  477 
28, 724 

252 

287 
12 

76 

70 

495 

1,675 

38 

37 

613 

1.881 

750 
1,740 
1.882 
3,284 

572 

8,967 

14,  822 

7,627 

5,144 

4.711 

16. 263 

28,  568 

34 

5 

108 

76 

452 

979 

(*) 

2 

67 
35 
453 

817 

3 

9 

9 

79 

87 

48 

(*) 

2,421 

2.651 

11. 494 

10,043 

34, 378 

35. 843 

72, 538 

68, 974 

1,868 

1,672 

65 

53 

5 

5 

13 

10 

47, 059 

47, 173 

135 

122 

19 
1,470 

67 

65 

9 

5 

2,571 

2.445 

1,868 

54 

41 

132 

118 

15 

10 

2,583 
44,899 

2,455 
45, 043 

48,  927 

48, 662 

189 

163 

2,553 

2,769 

11,  508 

10, 053 

81, 860 

83, 340 

121, 465 

117,  637 

2,057 

1,835 

299 
947 
472 
344 
31 
326 
3 

371 
780 
747 
298 
40 
406 
9 

8,455 

2,871 

85 

39 

4 

32 

9 

8,384 

1,506 

114 

26 
(*) 

13 

20,  455 

8,371 

3,240 

1,451 

89 

692 

79 

16, 348 

11,961 

4,717 

885 

276 

1,570 

87 

32, 330 

22.800 

6,083 

6,026 

555 

4,736 

5 

32, 682 

16,  641 

8,069 

4.996 

737 

5,802 

48 

497 
678 
243 
138 
30 
281 
2 

596 

484 

276 

81 

34 

200 

(*) 

2,421 

2,651 

11,494 

10,043 

34,378 

35, 843 

72, 538 

68, 974 

1,868 

1,672 

column  accompanying  the  Survey  of  Ownership  for  each  reporting  date,  beginning  with  December  31, 
1953.  The  corresponding  information  from  earlier  reports,  beginning  with  December  31, 1949,  is  summarized 
on  page  30  of  the  March  1954  Treasury  Bulletin. 

6  U.S.  savings  bonds  other  than  Series  G,  H,  and  K  are  included  at  current  redemption  value.  They  were 
reported  at  maturity  value  by  the  investors  covered  in  the  Treasury  survey  and  have  been  adjusted  to 
current  redemption  value  for  this  table. 

'  Includes  depositary  bonds  held  by  commercial  banks  not  included  in  the  survey:  $76  million  in  1960 
and  $29  milUon  in  1961. 

8  AU  issues  classified  to  final  maturity  except  partially  tax-exempt  bonds  which  are  classified  to  earliest  call 
date.  Table  28  in  this  report  shows  from  1946-61  the  maturity  distribution  of  marketable,  interest-bearing 
pubUc  debt  and  guaranteed  obligations  by  call  classes  and  by  maturity  classes.  The  following  difference 
in  the  two  tables  should  be  noted:  Table  28  classifies  District  of  Columbia  stadium  bonds  of  1970-79  ac- 
cording to  the  year  of  call  or  maturity  whereas  this  table  includes  these  bonds  with  guaranteed  obligations. 


630 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Account  of  the  Treasurer  of  the  United  States 

Table  56. — Assets  and  liabilities  in  the  account  of  the  Treasurer  of  the  United  States, 

June  30,  1960  and  1961 
[On  basis  of  daily  Treasury  statements,  see  "Bases  of  Tables"] 


June  30,  1960 

June  30,  1961 

Increase,  or  de- 
crease (— ) 

Gold 

$19, 321,  904,  926. 01 

.$17,  550,  069,  960. 13 

-$1,  771,  834,  965. 88 

Liabilities: 

Gold  certificates                         

2,  845,  958,  659.  00 

15,  278, 087,  296. 12 

935, 379,  509.  26 
156,  039.  430.  93 
106,  440, 030.  70 

2,  845,  870,  819.  00 

13,  396,  587,  296. 12 

1, 043, 034,  904.  20 
156,  039,  430.  93 
108,  537,  509.  82 

-87,  840.  00 

Gold  certificate  fund— 

IJoard  of  Governors,  Federal  Reserve 
System      _-  -. 

-1,881,500,000.00 

Redemption    fund— Federal    Reserve 

107,  655,  395. 00 

Gold  balance  in  Treasurer's  account 

2, 097,  479. 12 

Total  -    

19,  321,  904,  926.  01 

17,  550,  069,  960. 13 

-1,771,834,965.88 

SiLVEK 

Assets: 

Silver  bullion  (monetary  value)  ^ 

Silver  dollars          --     -.        

2,  252, 075,  098.  77 
174,  365,  287.  00 

2,  252,  333,  684.  63 
150, 172,  946.  00 

258,  585. 86 
-24,192,341.00 

Total                                               

2,  426,  440, 385.  77 

2,  402,  506.  630.  63 

—23, 933,  755.  14 

Liabilities: 

2,  393,  903,  682. 00 

1, 141,  684. 00 

31,  395, 019.  77 

2,  373,  870,  395. 00 

1, 141,  667.  00 

27,  494,  568.  63 

-20,  033,  287. 00 

Treasury  notes  of  1890  outstanding 

Silver  balance  in  Treasurer's  account — 

-17.00 
-3, 900,  451.  14 

Total    -  -- 

2,  426,  440,  385.  77 

2,  402.  506,  630.  63 

-23,  933,  755. 14 

General  Account 
Assets: 

In  Treasury  offices: 

Gold  balance  (as  above)            

IOC),  440, 030.  70 

31,  395,  019.  77 
8, 023,  620.  07 

336,  369. 38 
114,  936,  422.  22 

3,  188,  085.  88 

4,  354,  228.  00 
90,  504,  090.  00 

390,  800.  00 

162,  190.  00 

58, 187, 041.  39 

108,  537,  509.  82 

27,  494,  568.  63 
4,  706,  473.  95 

2, 097, 479. 12 

Silver: 

At  monetary  value,  balance  (as 
above) 

-3,  900,  451.  14 

Subsidiary  coin 

-3,317,140.12 

Bullion: 

-336,  369.  38 

57,111,015.93 

1,  612, 068.  83 

4,  757,  478. 00 

82,  514,  lO."-..  00 

458,  057.  00 

150,  705.  00 

63,  714,  886. 16 

-57,825,406.29 

-1,576,617.05 

United  States  notes                    ..  -- 

403,  250. 00 

Federal  Reserve  notes        _ 

-7,989,895.00 

Federal  Reserve  Bank  notes 

National  bank  notes    - 

67,  257.  00 
-11,485.00 

Unclassified— collections,  etc 

5.  527,  844.  77 

Subtotal                                   -    -. 

417, 918,  497.  41 

351, 056, 958. 32 

-66,861,539.09 

Deposits  in: 

Federal  Reserve  Banks: 

Available  funds      

504,  210,  695.  35 
336,  635,  221.  52 

6,  457.  668,  461.  64 

305,  90S,  639.  58 

69,  514, 198.  73 

407,  826, 163.  68 
222, 173, 188.  68 

5,452,671,002.11 
312,  612,  177.  SO 
22,  340,  203.  74 

-96,  384,  531.  67 

-114,462,032.84 

Special  depositaries,  Treasury  ta.x 

-1,004,997,459.53 

National  and  other  bank  depositaries- 
Foreign  depositaries        -- 

6,  703,  538.  22 
-47, 173,  994.  99 

Subtotal         

7,  673, 937,  216.  82 

0,  417,  622,  736. 01 

-1,256,314,480.81 

Total  assets,  Treasurer's  account- 

8, 091, 855,  714.  23 

6,  768,  679,  694.  33 

-1,323,176,019.90 

Liabilities: 

Board    of    Trustees,     Postal    Savings 
System: 

5  percent  reserve,  lawful  money 

Otherdeposits 

42, 000, 000. 00 
23,  465,  261.  05 
21,  649,  454.  83 

35,  500. 000. 00 
21,  943,  831.  22 
17,115,909.35 

-6,500,000.00 
-1,521,429.83 

Uncollected  items,  exchanges,  etc 

-4,  533,  545. 48 

Total  lialMlities,  Treasurer's  account.. 
Balance  in  Treasurer's  account 

87,114,715.88 
8, 004,  740,  998. 35 

74,  559,  740.  57 
6,694.119,953.76 

-12,  .554,  975. 31 
-1,310,621,044.59 

Total     Treasiu-er's     liabilities    and 
balance  - -  

8,  091,  855,  714.  23 

6,  768,  679,  694. 33 

-1,323,176,019.90 

1  Reserve  against  U.S.  notes  (.$346,681,016  in  1960  and  1961)  and  Treasury  notes  of  1890  outstanding  ($1,141,- 
684  in  1960  and  $1,141,667  in  1961).    Treasury  notes  of  1890  are  also  secured  by  silver  dollars  in  the  Treasury. 

2  There  were  64,751,316.1  ounces  held  on  June  30,  1960  and  1961,  by  certain  Federal  agencies. 


TABLES 


631 


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1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


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TABLES 


637 


Table  62.- — Location  of  gold,  silver  bullion  at  monetary  value,  and  coin  held  by  the 
Treasury  on  June  30,  1961 

[In  thousands  of  dollars.  On  basis  of  reports  received  from  various  Treasury  offices  and  Federal  Reserve 
Banks  which  take  into  account  those  transactions  in  transit  to  the  Treasurer's  olflee  as  of  Tune  30,  supple- 
mented by  information  taken  from  the  Treasurer's  accounts.  Therefore,  the  figures  shown  in  this  table 
may  differ  from  similar  figures  in  other  tables  prepared  on  basis  of  daily  Treasury  statements] 


Location 

Gold 

Silver  bul- 
lion at 
monetary 
value 

Standard 
silver 
dollars 

Subsidiary 
silver 
coin 

Minor 
coin 

U.S.  mints: 

2, 763, 842 

2,154 

300,  394 

1, 771,  720 

12, 483, 415 

228,  710 

24,  540 

37, 665 

300 

29, 485 

404 
847 

1384 

Philadelphia 

217,  229 

698, 384 

1,  253, 002 

'656 

San  Francisco..  .      .    

200 

Bullion  depository,  Fort  Knox 

Treasurer  of  United  States  (Cash  Division), 
Federal  Reserve  Banks,  etc                       .  - 

83,  719 

57, 173 

3,289 

448 

Total 

17,  550,  236 

2, 252, 334 

149, 164 

4,740 

1,488 

>  Includes  metals  and  alloys  in  process  of  manufacture  into  minor  coins. 
'  Includes_bullion_depository  at  West  Point,  N.Y. 


Table  63. — Paper  currency  issued  and  redeemed  during  the  fiscal  year  1961  and 
outstanding  June  SO,  1961,  by  classes  and  denominations 

[On  basis  of  reports  received  from  various  Treasury  Offices  and  Federal  Reserve  Banks  which  take  into 
account  those  transactions  in  transit  to  the  Treasurer's  office  as  of  June  30,  supplemented  by  information 
taken  from  the  Treasurer's  accounts.  Therefore,  the  figures  shown  in  this  table  may  differ  from  similar 
figures  in  other  tables  prepared  on  basis  of  daily  Treasury  statements] 


Issued  during 
1961 

Redeemed 
during  1961 

Outstanding  June  30, 1961 

In 

Treasury 

In  Federal 
Reserve  Banks 

Outside 

Treasury 

and  Federal 

Reserve  Banks 

Class 

$500,000 

1,305,828,000 

127,  704, 983 

$604,  330 

1, 336, 360,  434 

127,  704, 983 

1,317 

6,224,063,805 

7,951,696 
1,  504, 423 

$156, 350 

12,  491, 281 

4, 114,  525 

$2, 816, 055, 600 

280,555,736 

24, 228,  485 

$29, 803, 459 

Silver  certificates 

2, 094,  378, 909 

United  States  notes. 

Treasury  notes  of  1890. 

318,  338, 006 
1,141,667 

Federal  Reserve  notes 

Federal     Reserve     Bank 
notes                       

6, 790, 185, 000 

78,030,845 

458, 057 
150, 705 

1,529,368,005 

514, 500 
62,000 

27, 352, 908, 350 
91,811,369 

54, 261, 940 

Total 

8,224,217,983 

7, 698, 190, 987 

95, 401,  763 

4, 650,  784,  326 

29, 942,  643,  700 

Denomination 
$1           

1,022,608,000 

13.947,118 

1, 348,  977, 865 

2, 566,  760, 000 

2,  400, 800,  000 

3C6,  250, 000 

537,110,000 

8, 100, 000 

12,  650, 000 

15,000 

6,  500, 000 

500, 000 

1,003,817,715 

9, 972, 052 

1, 275,  839, 050 

2,366,113,350 

2, 239,  234, 820 

294, 930,  800 

455, 073,  700 

19,129,500 

27, 355,  000 

355, 000 

6, 370, 000 

9,313,208 

758,  500 

14, 676,  775 

20,  812,  400 

34,  969, 380 

6,  678,  800 

6,351,200 

224, 500 

1, 577, 000 

30.000 

10, 000 

246,457,826 

13, 573,  430 

209,  924,  710 

534,  564,  950 

524,  526,  460 

104,  827,  450 

139, 622,  500 

17,427,000 

35, 075, 000 

2, 645, 000 

11.  540, 000 

2,  810,  600, 000 

1, 462, 125,  215 

$2 

87,  759,  280 

$5 

2,161,636,135 

$10 

6,  637,  584. 102 

$20 

10,417,661,156 

$50           .            

2,757,211,015 

$100 

5,861,117,420 

$500 

243,017,250 

$1,000 -. 

306,  204, 500 

$5,000 -- 

2, 945, 000 

$10,000.                      

5,320,000 

$100,000 

62,627 

Total 

8, 224, 217, 983 

7, 698, 190, 987 

95, 401, 763 

4, 650,  784, 326 

29, 942, 643,  700 

638    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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TABLES 


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1,397,626 
'55,339,576 

1, 278, 632 
'64,619,473 

1, 561, 241 
55,896,493 

j          j 

1, 212,  766 
55,  552, 395 

1,252,269 
53,496,107 

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642 


1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 


I. — Trust  funds 

Table  65. — Ainsworth  Library  fund,  Walter  Reed  General  Hospital,  June  SO,  1961 

(This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  joint  resolution  of  Congress  ap- 
proved May  23,  1935  (49  Stat.  287).    For  further  details,  see  annual  report  of  the  Secretary  for  1941,  p.  154] 


I.  RECEIPTS    AND    EXPENDITURES    (EXCLUDING    INVESTMENT    TRANSACTIONS) 

Cumulative 

through 
June  30,  1960 

Fiscal  year 
1961 

Cumulative 

through 
June  30,  1961 

Receipts: 

Bequest  of  Maj.  Gen.  Fred  C.  Ainsworth... 

$10,700.00 
6,  542. 23 

$10,700.00 

$285. 00 

6, 827. 23 

Total  receipts 

17,242.23 
6,  482.  33 

285. 00 
157.  72 

17,  527. 23 

6, 640. 05 

Balance 

10,  759. 90 

127.28 

10, 887. 18 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year 
1961, increase 

June  30, 1961 

Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bonds,  3%  of  1995 

$9,  500. 00 
300. 00 

$9,  500. 00 

U  S  savings  bonds,  Series  J  (2  76%) 

300.  CO 

Total  investments 

9, 800. 00 
959.  90 

9, 800. 00 

Undisbursed  balance - 

$127. 28 

1, 087. 18 

Total  assets... 

10, 759. 90 

127.28 

10, 887. 18 

Table  66. — Civil  service  retirement  and  disability  fund,  June  SO,  1961 

[On  basis  of  daily  Treasury  statements  prior  to  June  30, 1953,  thereafter  on  basts  of  the  "Monthly  Statement 
of  Receipts  and  Expenditures  of  the  United  States  Government."  This  trust  fund  was  established  in 
accordance  with  the  provisionsof  theactof  May  22, 1920,  as  amended  (5  U.S. C.  2267).  For  further  details 
see  annual  report  of  the  Secretary  for  1941,  p.  136] 

I.  RECEIPTS    AND    EXPENDITURES    (EXCLUDING    INVESTMENT    TRANSACTIONS) 


Cumulative 

through  June  30, 

1960 

Fiscal  year  1961 

Cumulative 

through  June  30, 

1961 

Receipts: 

Deductions  from  .salaries,  service  credit 
payments,   and    voluntary   contribu- 
tions of  employees  subject  to  retire- 
ment act'               -  .      

$8,460,046,645.10 
4, 141, 386, 923. 21 
2,082,307,689.13 
3,048,472,787.33 

5,0.50,000.00 

$855, 645, 379.  57 

46, 329, 000.  00 

843,  859, 004. 70 

280, 175. 819. 15 

$9,315,692,024.67 

4, 187,  715, 923. 21 

Payments  by  employing  agencies' 

Interest  and  profits  on  investments 

Transfer  from  the  Comptroller  of  the 

2,  926, 166,  693. 83 
3, 328, 648, 606. 48 

5, 050, 000. 00 

Total  receipts 

17,737,264,044.77 

2,026,009,203.42 

19,  763, 273, 248. 19 

Expenditures: 

Annuity  payments,  refunds,  etc.. 

Transfers  to  policemen's  and  firemen's 
relief  fund,  D.C.,  deductions  and 
accrued  interest  thereon . 

7,653,104,118.07 
151, 967.  86 

950,997,841.06 
40, 937. 09 

8, 604, 101, 959. 13 
192, 904. 95 

Total  expenditures 

7,653,256,085.93 

951,038,778.15 

8, 604, 294, 864. 08 

Balance 

10,084,007,958.84 

1,074,970,425.27 

11,158,978,384.11 

Footnotes  at  end  of  table. 


TABLES 


643 


^ 


Table  66. — Civil  service  retirement  and  disability  fund,  June  SO,  1961 — Continued 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


Investments  in  public  debt  securities: 

Special  issues,  civil  service  retirement 
fund  series  maturing  June  30: 
Treasury  certificates  of  indebted- 
ness: 

2M7o  of  1961 

2',i7o  of  1962. 

Trea-^ury  notes: 

2h%  of  1961... 

2W7o  of  1961.. 

2h%  of  1962.. 

2H%of  1962. 

2H%ofl963.. 

2^6%  of  1963.. 

2li%  of  1963.... 

2^%  of  1964.... 

2'A%  of  1964... 

2ai%  of  1965... 

2'A%  of  1965 

2>i%  of  1966. 

Treasury  bonds: 

2i^%  of  1963 

2h%  of  1964. 

2!^%  of  1965.. 

25^%  of  1965. 

2h%  of  1966 

2S/i%  of  1966.... 

2!-^%  of  19G7. 

2W7o  of  1967 

2>i%of  1967.. 

2h%  of  1968 

2H%  of  1968 

2li%  of  1968.... 

2^i7cOf  1969-... 

2W/o  of  1969 

2^6%  of  1970-. 

2^4%  of  1970.. 

2W7c  of  1971. 

2;6%  of  1971 

2^6%  of  1972 

2'i%  of  1972 

2%%  of  1973 

2^8%  of  1973.. 

2H%  of  1974 

2'i%  of  1974. 

20^%  of  1975-... 

2;i%  of  1975... 

2J6%  of  1976 


June  30,  1960 


$185,  752, 000.  00 


385, 000,  000.  00 
179,211,000.00 
385.  000,  UOO.  00 
230.  527,  000  00 
200,  000, 000. 00 
230,  527, 000.  00 


230,  527,  000.  00 


51, 316, 000. 00 


185, 000, 000.  00 
386,  000,  000.  00 
385,  000, 000.  00 
179,211,000.00 
385,  000,  000.  00 
230,  527,  000.  00 
385, 000, 000.  00 
230,  527, 000. 00 


200,  000,  000.  00 
415,  527, 000.  00 


615,  527,  000. 00 


615,  527,  000. 00 


615,  527,  000.  00 


615,  527, 000. 00 


615,  627, 000.  00 


615,  527, 000. 00 


615,  527,  000. 00 


Total  special  issues 9, 367,  341,  000. 00 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


-$185, 752,  000. 00 
169,  697,  UOO.  00 


-385,  000, 000.  00 
-179.211,000.00 


9, 913, 000.  00 


9, 913,  000. 00 


69, 913,  000.  00 
69, 913, 000.  00 


69, 913, 000. 00 


69, 913, 000. 00 


09, 913,  000. 00 


69,  913,  000.  00 


69, 913, 000. 00 


69,  913,  000. 00 


69, 913,  000. 00 


69, 913,  000.  00 


69,  913,  000. 00 
685,  -140,  000. 00 


1, 014, 043,  000.  00 


June  30.  1961 


$169,  697, 000. 00 


385,  000, 
230,  627. 
200,  000, 
230,  627, 

69,913, 
230,  527. 
69,  913, 
51,316, 
69,913. 
69,  yl3, 

185, 000, 

386,  000, 
385,  UUO, 
179,211, 
385,  000, 
230,  527. 
385,  000. 
230.  527, 

69,913, 
200,  000, 
415,527, 

69,913, 
615.  527, 

69, 913, 
615,  527, 

69,913, 

615,  527, 
69,913, 

616,  527, 
69,913, 

615,  527, 
69,913. 

615,  527, 
69,  913, 

615,  ,'i27, 
69,913, 

686,  440, 


000. 00 
000. 00 
000. 00 
000.  00 
000.  00 
0(10.  00 
000.  00 
000.  00 
000.  00 
000.00 

000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.00 
000.  00 
000.  00 
000,00 
000.00 
000.00 
000.  00 
000.00 
000. 00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000. 00 


10,  381.  384,  000. 00 


Footnotes  at  end  of  table. 


644   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  6G. — Civil  service  retirement  and  disability  fund,  June  30,  1961 — Continued 
II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT— Continued 


Assets 


June  30,  1900 


Fisral  year  1961, 
increase,  or 
decrease  (— ) 


June  30.  1961 


Investments  in  public  debt  securities— Con. 
Public  issues: 

Treasury  notes: 

4%.  Series  A-19fil.. 

35^%,  Series  A- 1902 

3'M%,  Series  C-1962. 

2)^9^,  Seiies  A-1903 

4%,  Series  B-1963 

ilifo,  Series  C-1963 

4?4%,  Seiies  A-1964 

5%,  Series  B-1964 

4"^^%,  Scries  C-1904 

4'?^%,  Series  A-1965 

Treasury  bonds: 

2H%  of  1959-62  (June  1 ,  1945).. . 
2l'>"/r  of  1964-69  (April  15,  1943).. 
2>.^%  of  1964-69  (Sept.  15,  1943).. 

2>^<7f  of  1965. 

2^1;%  of  1965-70-... 

3%  of  1966 

2y>%  of  1966-71 

3>^%  of  1967 

2H%  of  1967-72  (June  1,  194.5).. . 
2'.v%  of  1967-72  (Oct.  20,  1941)... 
2H%  of  1967-72  (Nov.  15,  1945).. 

3'/§%  of  1908.... 

4%  of  1969... 

Zli7o  of  1974 

4H%  of  1975-85. 

3M%  of  1978-83... 

3!.'2%  of  1980 

4%  of  1980 

3K%  of  1985..-. 

3!.^%  of  1990 

3%  of  1995 

Zyi7o  of  1998. 


73, 900, 
50.  000, 
20,  000. 
47,  700, 
20.  000. 
23,  500. 
12.  550, 
19,  937, 
23,  550. 
3,  700, 


000.  00 

000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 


-73, 900, 000.  00 
-50,000.000.00 
-20,000.000.00 
-47,  700,  000.  00 
-20, 000,  000.  00 


23,  500, 000.  00 
12,  550.  000.  00 
19.  937,  000. 00 
23.  650,  000.  00 
3,  700,  000.  00 


700, 000.  00 


21, 500,  000.  00 

'25,"ooo,'oo6."o6" 


-700,  000.  00 
8,  500, 000.  00 
13,  400. 000. 00 


3,  000,  000.  00 


6,  400,  000.  00 
38,  200.  000. 00 
30,  000,  000.  00 
23.  000,  000.  00 


41,  644,  000.  00 
74,  900.  000.  00 
12,  500,  000.  00 
55,  205,  000.  00 


4,  000, 
48,  4uO, 

4,  600, 
22, 800, 

9,  500. 

5,  000, 
2,  600, 

15,  150. 
9,  500, 
5, 100, 
9,  000, 
5,  100, 
1,  5a\ 

61,  600, 


000.00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 


29.  294, 000.  00 


8,  500, 
13.  400, 

21,  600. 

3,  000, 
25,  000, 

4,  000. 
48,  400. 

4,  600. 

22.  800. 

9,  500. 
11.400, 
40,  800, 

45.  150. 
32,  500. 

5,  100. 
9.  000. 

46,  744. 
76. 400, 
74,  100, 
55.  205, 
29,  294, 


000.  00 
000.  00 
000.  00 
000. 00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000  00 
OOU.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000.  00 
000. 00 
000.  00 
000.  00 
000. 00 


Total  public  issues. 

Total  investments. 
Undisbursed  balance 


623, 886,  000.  00 


45,  744,  000.  00 


669,  630. 000. 00 


9, 991,  227,  000.  00 
92.  780.  958. 84 


1, 059,  787,  000.  00 
15,  183,  425.  27 


11,051.014,000.00 
107,964,384.11 


Total  assets- 


10, 084, 007, 958.  84 


1, 074, 970,  425.  27 


11,158,978,384.11 


'  Basic  compensation  deductions  weie  at  the  rate  of  2J.2%  from  Aug.  1,  1920,  to  June  30,  1926:  3H%  from 
July  1,  1926,  to  June  30,  1942;  5%  from  July  1,  1942,  to  the  day  before  the  fiist  pay  period  which  began  after 
June  30,  1948;  6%  thereafter  to  the  day  before  the  fiist  pay  period  which  began  after  September  30,  1956; 
and  &]/■:•%  thereafter.  Also  includes  District  of  Columbia  and  Government  corporations'  contributions 
through  1957.     Beginning  with  1958  they  are  included  with  contributions  from  agency  salary  funds. 

'  Beginning  July  1,  1957,  appropriations  are  not  made  diiectly  to  the  fund.  Instead  the  employing  agen- 
cies contribute  amounts  (from  agency  appropriations)  equal  to  the  deductions  from  employees' "salaries  in 
accordance  with  the  act  aiiproved  July  31,  1950  (5  U.S.C.  2254(a)). 

3  The  act  of  .June  30,  194S,  as  amended  (5  U.S.C.  739  (a)  (b)),  abolished  the  separate  retirement  fund  for 
employees  of  the  Office  of  the  Comptioller  and  directed  transfer  of  its  assets  to  the  civil  sei  vice  retirement 
and  disability  fund.    Amount  comprises  cash  derived  from  sale  of  securities. 


TABLES 


645 


Table  67. — District  of  Columbia  teachers'  retirement  and  annvity  fund,  June  SO,  1961 

[This  fiin<1  was  ostablishod  in  acooninnco  witi'  the  provisions  of  tho  apf  nf  Aue  7.  I94*i  f31  DTP  702,  707, 
772),  :is  succ'ps^or  in  ihi  Dislrici  of  rnliinibiii  IcmcIhts'  rp'ircmcn!  fiin<i  cslaMlslic'l  uii'li'i  ihc  aci  of  Tan. 
IS.  1920,  as  urni'ndi'il.  iMTcoliitg  llie  consoliilulioii  of  ihe  lieduciions  fund  and  llie  Govciiiiiicnt  reserve 
fund  as  nf  .luly  I.  19451 

I.   RECEIPTS  AND   EXPENniTURES  (EXCLUDING     INVESTMEVT    TR  A  N'SACIIONS) 


Cumulative 

through  lune 

30,  I960 


Fiscal  vear 
1961 


Cumulative 

through  .fune 

30.  1961 


Receipts: 

Deductions  from  salaries 

Voluntary  contributions 

Interest  and  profits  on  investments 

Appropriations  from  District  of  Columbia  revenues 

Total  receipts 

Expenditures: 

Annuities,  refunds,  etc 

Balance 


$21,640,417  52 

179,  165  .55 

13.  633,  786.  67 

40.941,972.84 


$1,  794  931  93 

3.  975  00 

1,163,314.92 

4.  025, 000.  00 


76, 395, 342,  58 
41,220.469,72 


6,987.221.85 
4,66,5,719.19 


35, 174, 872.  86 


2,321.502.66 


$23,  435, 349.  45 

183, 140  55 

14,797,101  59 

44, 966,  972  84 


83, 382,  564.  43 
45,886,188.91 


37, 496,  375.  52 


II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30, 1960 


Fiscal  year 
1961,  incre.ase, 
or  decrease  (  — ) 


June  30,  1961 


Investments  in  public  debt  securities: 
Public  i.ssues: 

Treasurv  notes: 

4%,  Series  D-1962 

4^4%.  Scries  A-I964 

4H'^.  Series  A-1965 

Treasury  bonds: 

2!.5%  of  1963 ..-- 

2H%  of  1964-69  (dated  Apr  15,  1943) 

24%  of  1964-69  (dated  Sept.  15,  1943). 

2W%  of  1965-70 

2\f.%  of  1966-71 

33^%  of  1966 

2U%  of  1967-72  (dated  June  1,  1945).. 

ZIW,  of  1968 

m%  nf  1974 

A\a%  of  1975-85 

SKi'^f  of  1978-83 

4%  of  1980 

VAJ,  of  1985 

ZV2%  of  1990 

3%  of  1995.. 

3H^  of  1998..- 

2\<i%  Investment  Series  A-1965 

254%  Investment  Series  B-1975-80.... 
U.S.  savings  bonds: 

Series  Q  (2.50%) 

Series  K  (2.76%) 


Total  investments. 
Undisbursed  balance 


$475. 

2,617, 

200, 

8.5C, 
865. 

1,303, 
257, 

1,517, 


000.  00 
000.  00 
000. 00 

500,  00 
000,  00 
500,  00 
000.  00 
000. 00 


1.919. 
1,056, 


000.  00 
500.  00 


1,  ono, 

1.  777, 

ion, 

194. 

Lgo."). 
3, 599, 


000. 00 
,500. 00 
000, 00 

500,  00 
000,  00 
500. 00 


Total  assets 35,174,872. 


-$856,  .WO.  00 

-86.5.000.00 

-1,303,500.00 


856,  500.  00 
"2,"  .388,  500.' 00 


421, 000.  00 
"2,168, 500.06" 


-200.  000.  00 
-315,000.00 


2, 294,  500.  00 
27, 002.  66 


2,321,502.66 


$475, 000.  00 

2,617,000  00 

200, 000.  00 


257. 
1,517, 

856, 
1,919. 
1,056, 
2. 388, 
1,  000, 
1,  777, 

100, 

194, 
2, 386. 
3,  599, 
2, 168, 

250, 
14, 325, 


000,  00 
000. 00 
500. 00 
000.  00 
500,  00 
500,  00 
000. 00 
500.  00 

ono.  00 

500,  00 
000. 00 
500,  00 
500.  00 
000,  00 
000.00 


37,  087,  500.  00 
408, 875.  52 


37, 496,  375.  52 


646 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  68. — District  of  Columbia  other  funds— Investments  as  of  June  SO,  1960  and 

1961 

[These  investments  were  made  in  accordance  with  nrovisions  contained  in  appropriation  acts  for  the  District 

of  Columbia] 

1.  GENERAL  FUNDS 


Investments  in  public  debt  securities 


June  30, 1960 


Fiscal  year  1961. 
incrense  or 
decrease! — ) 


June  30,  1961 


Public  issues: 

Treasury  notes,  ZW7o,  Series  B-1961. 

Treasury  bonds: 

2M%  of  1960 -- 

2K>%  of  1963 

2H%  of  1965 

2H%  of  1965-70 -- 


Total. 


$2, 464, 000.  00 

3,  963,  500.  00 
1.236.000.00 
6.  086.  000  00 
13,213,000.00 


-$2,  464. 000.  00 

-3.963,500.00 
-1,236,00(1.00 
-6,986,000  00 
-4.000,000.00 


27,  862,  500. 00 


-18,649,500.00 


$9,  213, 000. 00 


9, 213, 000. 00 


II.  MOTOR  VEHICLE  PARKING  FUND 


Public  issues: 

Treasurv  bills .  

$691, 000. 00 

-749,000.00 

-289,000  00 

593,  000. 00 

-394,000  00 
-400. 000,  00 

14,';.  000.00 

900, 000.  00 

$691, 000.  GO 

Treasury  certificates  of  indebtedness: 

i''A%,  Series  A-1961  

$749.  000  00 
289, 000.  00 

4?^%,  Series  B-1961 

34%.  Series  C— 1961 

593, 000. 00 

Treasury  notes. 

AM%,  Series  C-1960      .. 

394, 000  00 
400,  000.  00 
203, 000. 00 

3H%,  Series  B-1961 

4%,  Series  R— 1962. 

3H%,  Series  0-1962... 

348. 000  00 
900,  000.  00 

4*^%,  Series  A-1965      ..                 ... 

743.000.00 
103, 500.  00 

743, 000. 00 

Treasury  bonds: 

2M%  of  1959-62  (dated  June  1,  1944) 

-10.3,500.00 
103,  500.  00 

3H%ofl967 -. 

103,  500. 00 

Total 

2. 881,  500. 00 

497, 000.  00 

3, 378.  500.  00 

III.  RECREATION  DEPARTMENT  TRUST  FUND 

Public  is.sues: 

Treasury  notes,  4%,  Series  D-1962  ... 

$10, 000.  00 

$10, 000.  00 

IV.  REDEVELOPMENT  PROGRAM— REDEVELOPMENT  LAND  AGENCY 

Public  issues: 

Treasury  bills 

$1, 361, 000.  00 

-$952,000.00 

$409, 000.  00 

V.  METROPOLITAN  AREA  SANITARY  SEWAGE" WORKS  FUND 

Public  issues: 

Treasury  bills 

$2,429,000.00 

$2,  429, 000. 00 

VI.  STADIUM  FUND,  ARMORY  BOARD 

Public  issues: 

Treasury  bills. 

Treasury  notes: 

4%,  Series  A-1961... 

Z'',i%.  Series  B-1961 

3H%,  Series  A-1962. 
Treasury  bonds: 

2M%  of  1960 

2H%  of  1961 


Total. 


$2, 000.  00 
7, 000.  00 


2. 000.  00 
1,  500.  00 


12,  500. 00 


$5, 158, 000.  00 


1, 974.  000.  00 
-2,000.00 


-2,  000.  00 
2, 999,  000.  00 


10, 127, 000. 00 


$5. 158, 000.  00 
1, 974, 000. 00 

'7,666.'6o 


3, 000, 500. 00 


10, 139,  500.  00 


TABLES 


647 


Table  68. — District  of  Columbia  other  funds — Investments  as  of  June  30,  1960  and 

i5(?i— Continued 

VII.  WELFARE  FUNDS— DEPARTMENT  OF  CORRECTIONS 


Investment  in  public  debt  securities 

June  30,  1960 

Fiscal  year 

1961,  increase  or 

decrease  (—) 

June  30,  1961 

Public  issues: 

Treasury  notes: 

ZM%,  Series  B-1961 

$15, 000. 00 

-.$15, 000. 00 
10, 000. 00 

4%,  Series  B-1963.- 

$10,  000.  00 

Total 

15, 000. 00 

-5,000.00 

10, 000. 00 

VIII.  MISCELLANEOUS  TRUST  FUNDS  • 


Public  issues: 

Treasury  bonds: 

2'-',i%  of  1965 

4%  of  1980 

3%  of  1995- 

U.S.  savings  bonds: 

Series  O  (2..'iO%) 

Series  H  (3.25%) 

Series  J  (2.76%). 

Series  K  (2.76%) 

Total.- -. 


$19, 000. 00 

15,  500,  00 
40,  500. 00 

17, 300.  00 

16,  500,  00 
10,  675. 00 
33,  500.  00 


152,  975. 00 


-$1,300.00 
-500. 00 
-300.  00 


-2,100.00 


$19,000.00 
15,  500. 00 
40, 500.  00 

16, 000.  00 
16, 000. 00 
10,  375.  00 
33,  500. 00 


150, 875. 00 


■  Investment  of  tliesp  funds  was  made  directly  througli  the  facilities  of  the  District  of  Columbia  with  the 
exception  of  $19,000  of  2%%  Treasury  bonds  of  1965  and  $15,500  of  4%  Treasury  bonds  of  1980  which  were 
handled  by  the  Treasury  Department. 


Table  69. 


-Employees  health  benefits  fund,   Civil  Service   Commission,  June  SO, 
1961 


[On  basis  of  reports  from  the  Civil  Service  Commission.    This  trust  revolving  fund  was  established  in 
accordance  with  the  provisions  of  the  act  of  September  28,  1959,  as  amended  (5  U.S.C.  3007)] 

L  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Receipts: 

Direct  appropriations  ' 

Employoos'  and  annuitants'  withholdings  ^ 

Agency  contributions  ' 

Interest  and  profits  on  investments 

Total  receipts 

Expenditures: 

Subscription  charges  paid  to  carriers _ 

Administrative  expenses— reimbursement  to  employees'  life  insurance  fund  < 
Interest  on  adminLstrative  expenses  paid  by  employees'  life  Insurance  fund  <. 
Other' 

Total  expenditui-es.. 

Balance 


$2,500,000.00 

183.  973.  428,  58 

109, 635.  620.  "1 

40,  231.  58 


296. 149.  280.  87 


272,076,931,37 

1, 478. 826  95 

43  625  79 

-713, 336,  63 


272, 886, 047.  48 


23,  263, 233. 39 


Footnotes  at  end  of  table. 


648    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  63. — Employees  health  h^'ncfits  fund,   Civil  Service  Commission,  June  SO, 

1961— Continued 

11.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


Amount 


Investments  in  public  debt  securities: 
Public  issues: 

Tre.isury  hills. 

Treiisury  certificates  of  indebtedness,  3>^%,  Series  C-1961 
Treasiii  y  bonds: 

2U.%  of  1961- -.. 

21/2%  of  1905-70 

2>4%  of  1966-71 - 

3h%  of  1967... 

Total  investments 

Undisbursed  balance 

Total  assets 


$3. 000. 000.  00 
1.000,000.00 

1.  239,  500.  00 

2.  130.  500.  00 

3.  950. 000  00 
1. 004. 000  00 


12.324,000  00 
10,939,233.39 


23, 263, 233. 39 


'  Qovernnienf  piyments  from  annual  appropriation  for  annuitants  autiiorized  by  section  7(c)  of  the 
act  '5  U.^C  3;J06(cl). 

2  .As  provided  in  the  act  '^  fT.S.C.  3n06fa)3.  4).  "There  shall  be  withhold  from  •  •  •  each  enrolled  employee 

•  *  •  or  annuitant  so  much  as  is  necessiry.  after  deducting  the  contribution  of  the  Ooverumont.  to  pay 
the  total  ell  in;e  for  his  enrollment." 

3  As  provided  in  the  act  (5  U.S.C.  300r,(a)  1-3).  "*  *  *  the  Government  contribution  for  health  benefits 

•  *  *  shall  be  .50  per  centum  of  the  lowest  rates  charsed  by  a  c.irrier  •  *  ♦  but  (A)  not  less  than  $1.25  or 
more  than  $1.75  biweekly  *  *  •  for  self  alone,  (B)  not  less  than  $3  or  more  than  $4  25  biweekly  *  *  •  for 
self  and  fanuly  *  '  *,  and  (C)  not  less  than  $1.75  or  more  th  in  $2.50  biweekly  for  a  fem\le  employee  •  •  * 
for  self  and  family  including  a  nondependent  husband."  Or  if  "the  biweekly  subscription  charge  is  less 
than  $2.,M  "  *  *  for  self  alone  or  $6  *  '  *  for  self  and  family,  the  contribution  of  thi;  Government  shall  be 
50  per  centum  of  such  subscription  charce,  e,xcepf  that  if  a  nondependent  husband  is  a  member  of  the  family 
of  a  female  employee  *  *  *  enrolled  for  herself  and  family  the  contribution  •  *  •  shall  be  30  per  centum 
of  such  subscription  charge."  Also  "There  shall  be  coiitr  buted  •  *  *  amounts  (in  the  same  ratio  '  *  *) 
whi."h  are  necessiry  for  the  administrative  costs  and  the  reserves  provided  lor  •  *  *." 

*  As  provided  in  the  act  (5  U.S.C.  3008(a)). 

»  Diilerence  between  cost  and  face  value  of  investments. 

Table  70. — Employees'  life  insurance  fund,   Civil  Service  Commission,  June  SO, 

1961 

[On  basis  of  reports  from  the  Civil  Service  Commission.     This  trust  revrilving  fund  was  established  in 
accordance  with  the  provisions  of  the  act  of  August  17,  19.54,  as  amended  (5  U.S.C.  2091(c))] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  .Fune 

30,  1960 

Fiscal  year  1961 

Cumulative 

through  .June 

30,  1961 

Receipts: 

Employee  withholdings  ' 

$409.13.5.643  32 
204, 567, 821.  66 

9,805,140  70 
5, 624,  528.  25 

13.815,263.40 
7,311,513  99 

$93. 6.55.  448  62 
46,827,724.31 

3,  508.  059.  20 
5,  201,  294. 31 

19.  109.  60 
177.  120.  97 

$502,791,091  94 

Government  contributions  '       

251,395.546.97 

Premiums  collected  from  beneficial  association 
members  .. 

13, 313.  799.  90 

Interest  and  profits  on  investments 

10, 825, 822.  .56 

Assets  acquired  from  beneficial  associations: 

United  Slates  securities  ' 

Other 

13,834,373  00 
7,488.634.96 

Total  receipts 

650,259,911.32 

149. 389.  3,57.  01 

799, 649, 268. 33 

Expenditures: 

Premium?  paid  to  insurance  companies: 

For  Federal  employees  genenlly 

Less  return  of  premiums  paid 

For  beneficial  association  members 

Less  return  of  premiums  paid 

Administrative  expenses 

Net  p.iyments  for  employees  health  benefits 
(reimbursable)  ' 

600,332,991.55 

112,208,321.  17 

15.  128.964  01 

3,96.5.  131  59 

917.801.01 

.567.766  12 
-3.719,911.06 

135.210.827  49 

'38.679.  .571   16 

5,  483.  038  03 

<  1,616.180.54 

263.041.  15 

«  -227. 159  35 
'  -1.968,542  36 

735.  543. 819.  04 

150.887.892  33 

20. 612, 002.  04 

.5,5«1.312.  13 

1. 180, 842.  16 

340.  606  77 

Other 

-5,688,483.42 

Total  expenditures 

497.054.  128  87 

98, 465. 453  26 

695.519.582.13 

Balance 

153.  20.5,  782.  45 

50,923,903.75 

204,129,686.20 

Footnotes  at  end  of  table. 


f 


TABLES 


649 


Table  70. — Employees'  life  insurance  fund,  Civil  Service  Commission,  June,  SO, 

1961 — Continued 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30,  1960 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


June  30,  1961 


Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bills 

Treasury  notes: 

3H%,  Sop'es  B-1961.. 

3H7o,  Series  A-1962 

3?4%,  Scries  C-1962 

4%,  Series  D-1962 

3!.4%,  Series  F-I962 -. 

2H%,  Scries  A-19()3 

i'A%,  Scries  C-1963 

3y,%,  Series  D-1963 

4%%,  Series  A-1964 

45/^%,  Series  A-1965 

Treasury  bonds: 

2H<^r  Of  I960. - 

2%%  or  1961... , 

2M2%  of  1962-67 , 

2H'7r  of  1963... 

2^^."^,  of  1963-68 

3%  of  1964 

2H%  of  1964-69  (dated  April  15,  1943) 
2H%  of  1904-69  (dated  Sept.  15,  1943). 

25.i%  Of  1965.... 

2K'%  of  1965-70 

334%  of  1966 

37o  of  1966 

3H7o  of  1966... 

2h%  of  1966-71 

2^2%  of  1967-72  (dated  June  1,  1945).. 
2H%  of  1967-72  (dated  Nov.  15,  1945).. 

35,^%  of  1967. 

31,i%  of  1968 

4%  of  1969 

3M%  of  1978-83.. 

47,  of  19.S0-.- 

3h%  of  1990. 

3%  of  1995 

3!^%  of  1998 

2%7r  Investment  Series  B-1975-80— .. 

U.S.  savings  bonds: 

Series  F  (2.53%)  (current  redemption 

value). 

Series  G  (2.r'0°7,)   

Series  J  (2.76%)  (current  redemption 

value) 

Series  K  (2.76%) 


Total  investments - 
Undisbur!!ed  balance 


$18, 000. 000. 00 

10, 000, 000. 00 
5.  000,  00(1.  00 
5, 000, 000  00 

10,  000, 000. 00 


5, 000, 000.  00 
10, 000, 000. 00 


15,000,000.00 
5, 0»6, 000. 00 

5,000,000.00 

5,  000, 000. 00 

15, 000. 00 

5, 005, 000. 00 

45.  000. 00 

5, 000, 000  00 

820,  500. 00 

435. 000. 00 

15, 000, 000. 00 

413, 000. 00 


14,  205, 000. 00 


231,000.00 
367,  500. 00 
341,  500. 00 


12, 000. 000. 00 


235, 000. 00 

1,  200, 000.  00 

232, 000. 00 

135,  ."iOO.  00 


179, 000.  00 


157,  615. 00 
10, 000. 00 


475, 432. 00 
15, 000. 00 


$2, 000, 000. 00 
-10,000,000.00 


783, 000. 00 


1,  666, 000. 00 
-5,000,000.00 


10, 000, 000. 00 


-5, 000. 000. 00 
5, 000. 000. 00 
15. 000. 000. 00 

-5.005,000.00 
2, 955, 000. 00 


-820,  500. 00 
-435, 000. 00 

5, 000, 000. 00 
1, 022,  500. 00 
6,  783,  000. 00 

5,  000, 000.  00 

15, 030, 000. 00 

1,  797,  500. 00 

1,  255,  500. 00 

-24. 420. 00 

13, 637.  60 

149,  604, 047. 00 
3,  601.  735. 45 


47,021,217.60 
3.902,686.  15 


$20, 000, 000. 00 


5, 000, 000. 00 

5. 783, 000. 00 

10, 000, 000. 00 

1, 666, 000. 00 


10, 000, 000. 00 
10. 000, 000. 00 
15.000,000.00 
5, 086, 000. 00 


10. 000, 000. 00 
15,015,000.00 


3, 000, 000. 00 
5, 000, 000. 00 


15. 000. 

413, 

5, 000, 

15,  227, 

6,  783. 

231, 

367, 

341, 

5, 000. 

12,000. 

15, 030, 

23.5. 

1,  200, 

2, 029, 

13.5, 

1, 255. 

179, 


000. 00 
000. 00 
000. 00 
500. 00 
000  00 
000. 00 
500. 00 
•■'OO.  00 
000. 00 
000. 00 
000. 00 
000.  00 
000. 00 
500. 00 
500.  00 
500. 00 
000. 00 


133, 195. 00 
10. 000. 00 


489, 069.  60 
15, 000. 00 


196,  625,  264.  60 
7,  504.  421. 60 


Total  assets. 


153,  205,  782.  45 


50,  923, 903.  75 


204, 129,  686.  20 


1  As  provided  in  the  act  (5  U.S.C  2094(a)),  "*  *  *  there  shall  he  withheld  from  each  salary  payment  of 
such  employee,  *  *  *  not  to  exceed  the  rate  of  25  cents  biweekly  for  each  $1,000  of  his  group  life  insur- 
ance *  *  '";  and  in  5  U.S.C.  2094(b)  "*  •  *  there  shall  be  contributed  from  the  respective  appropriation 
or  fund  •  *  *  not  to  e.\ceed  one-half  the  amount  withheld  from  the  em|)loyee  *  ♦  *." 

2  Includes  Series  F  and  J  bonds  at  current  redemption  value.  Amount  for  the  fiscal  year  1961  is  accrued 
increment. 

3  Premium  payments  in  excess  of  the  $100  million  contingency  reserve  set  by  the  Civil  Service  Com- 
mission, which  are  required  to  be  returned  to  the  fund  by  the  insuring  companies  (5  U.S.C.  2097(d)). 

*  Return  of  premium  payments  in  excess  of  annual  claims  paid,  expenses,  and  other  costs. 

»  To  pay  administrative  expenses  incurred  by  the  Commission  i  i  carrying  out  the  Federal  Employees' 
Health  Benefits  .A.ct  of  1959  and  the  Retired  Federal  Employees'  Health  Benefits  Act  of  I960;  reimburse- 
ment with  interest  is  to  be  made  from  the  employees  health  benefits  fund  (5  U.S.C.  3008(a))  and  the  retired 
employees  health  benefits  fund  (5  U.S.C.  305»<(e)). 

«  Consists  of  the  following:  Current  year  payments  of  administrative  expenses  in  the  amounts  of  $911,- 
060.83  for  employees  health  benefits  fund  and  $o40,r.06.77  for  retired  employees  health  benefits  fund,  and 
reimbursements  of  $l,478,82ii.95  from  employees  health  benefits  fund. 

'  Includes  the  difference  between  cost  and  face  value  of  investments  amounting  to  —$1,969,394.81. 


650   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  71. — Federal  disability  insurance  trust  fund,  June  SO,  1961 

[This  trust  fund  was  established  in  accordance  with  tie  provlsioD<<of  the  act  approved  August  1,  1956  (42 

U.S  C  40l(b))| 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cum.ulative 

through  Tune  30, 

1960 

Fiscal  year  1961 

Cumulative 

through  .Tune  30, 

1961 

Receipts: 

$2, 981.. Wl. 002  34 
18.3.  675.  477  42 
98,  863. 126,  08 

26,  831. 000. 00 

$962,812,407  76 
68.689.641   10 
61,486,814.11 

$3,944,313,410.10 

252  .365  118  52 

Interest  and  profits  on  investments 

Payments  from  railroad  retirement  ac- 
count (45  U.S.C.  22Se(k)).. 

160. 349, 940. 19 
26,831  000  00 

Total  receipts 

3.  290,  870, 605  84 

1, 092.  988.  862  97 

4, 383.  8.';9,  468  81 

Expenditures: 

1, 035, 954, 103.  54 
19,500,000.00 

703.  995,  671.  89 

9.  500. 000.  00 
5, 148,  000.  00 

3, 122,  289.  56 
»  34, 052,  915.  00 

1, 739, 949,  775.  43 

Payments  for  refund  in?  internal  rev- 
enue collentions  (42  U.R.C.  401(g)(2)). 
To  Railroad  Retirement  Board 

29,  Ono,  000.  00 
5, 148, 000. 00 

14,414,429.02 

Administrative    expenses    (42    U.S.C. 
40Ue)(1))- 
To  general  fund 

11,  292, 139.  46 
56. 909,  888.  00 

To  Federal  old-age  and  survivors 
insurance  trust  fund    .      _  -  . 

90. 962,  803.  00 

Total  expenditures 

1,123,6.56,131.00 

75.'i,818,876.  45 

1, 879, 475, 007.  45 

Balance 

2, 167, 214, 474.  84 

337, 169, 986.  52 

2, 504, 384, 461.  36 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30,  1960 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


June  30, 1961 


Investments  in  public  debt  securities: 

Special    issues.    Federal    disabih'ty    in- 
surance  trust  fund  series  maturing 
June  30: 
Treasury  certificates  of  indebted- 
ness- 

2H%  of  1961 

3%%  of  1962 

Treasury  notes: 

2Vi%o{  1961 

2'!6%of  1961 -. 

2!-^%  of  1962  

2'!i%of  1962.. -. 

2V2%  of  1963 

2Si%or  1963 

3?^'^r  of  1963 

2?^%  of  1964 

3S^%of  1964 

25,6%  of  1965 

m%oi  1965 

ZH%  of  1966... 

Treasury  bonds: 

2V^%of  1963 

2H%cf  1964 

2H%of  1965  

2-^.i%of  1965 

2U%ofl966 

2=6%  of  1966 

2!/>%of  1967 

2=6%  Of  1967 

3?^%  Of  1967 

2M%  of  19(58 

2H%  of  1968 

ZH%ol  1968 

2'4%0f  1969 

3%%  of  1969 

2H%  of  1970 

ZVi'Vc  of  1970 

256%  of  1971 


$56, 394,  000.  00 


37,  500, 000.  00 
63, 000, 000.  00 
37,  500. 000.  00 
95,  394, 000.  00 
30, 000, 000.  00 
95, 394, 000.  00 


95, 394, 000.  00 
"32,"394,"66o.'6o" 


500, 000  00 
500.  000.  00 
.WO.  000  00 

ono.  000. 00 

.500  000  00 
394.000  00 
500.  000.  00 
394, 000.  00 


30. 
102, 


000, 000.  00 
894, 000.  00 


132, 
"i32,' 
'132,' 


894, 000. 00 
894,"6oO."o6' 
894,'600."00' 


-$56,  394,  000.  00 
34, 096, 000.  00 


-37,500.000.00 
-63,000,000.00 


19,  389, 000. 00 
"i9,"389,"666."6o' 


19, 389,  000.  00 
19, 389, 000.  00 


19, 389, 000.  00 


19, 389, 000. 00 
'i9,'389,"o6o'oo' 

'i9,'389,'66o."66' 


$34, 096, 000. 00 


37,  500, 
95,  394, 
30, 000, 
95, 394, 
19, 389, 
95, 394, 
19. 389, 
32, 394, 
19,  389, 
19, 389, 

7,  500, 
37,  500, 
37,  500, 
63,  000, 
37.  500, 
95,  394, 
37,  500, 
95, 394, 
19,  389, 
30, 000, 

102,  894, 
19, 389, 

132,  894, 
19,389, 

132. 894, 
19. 389, 

132, 894, 


000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000.  00 
000. 00 
000. 00 
000.  00 

000. 00 
000.  00 
000.  00 
000. 00 
000.  00 
000.  00 
000.  00 
000. 00 
000. 00 
000.00 
000.  00 
000.  00 
000. 00 
000.  00 
000.  00 
000.  00 
000. 00 


Footnotes  at  end  of  table. 


TABLES 


651 


Table  71. — Federal  disability  insurance  trust  fund,  June  30,  1961 — Continued 
II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT— Continued 


Assets 


June  30, 1960 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


June  30, 1961 


Investments  In  public  debt  securities — Con. 
Special    Issues.    Federal   disability   in- 
surance   trust    fund  series  maturing 
June  30 — Continued 
Treasury  bonds:— Continued 

3%%  of  1971 

2i^%  of  1972 

3%%  of  1972 

2^&%of  1973 

3%%  of  1973 

2H%  of  1974 - 

3%%  of  1974 

2^%  of  1975. 

3%%  of  1975 

3M%  of  1976 


$132, 894, 000. 00 


132, 894, 000.  00 
"i32,'894,'O06."oo" 
"i32,"894,"66o.'oo' 


Total  special  issues - 


2,017,410,000.00 


Public  issues: 

Treasury  notes: 

Zyi%.  Series  C-1962. 

2%%,  Series  A  1963  

4%,  Series  B-1963 

4Ji%.  Series  C-1963 

5%.  Series  B-1964 

Treasury  bonds: 

2^A%  of  1965 

3%  of  1966 

2).2%  Of  1967-72  (dated  Oct.  20, 

1941) 

3^%  Of  1967 

3J6%  Of  1968. 

4%  Of  1969 

ZH%  Of  1974 

4H%  of  1975-85 

4%  of  1980  

3^%  of  1990. 

Z\<>%  of  1998. 


7, 000,  oon.  00 

10, 000. 000.  00 
5, 000. 000.  00 
5, 000. 000.  00 
S,  000, 000. 00 

18,250.000.00 
10, 000, 000. 00 


10, 000. 000. 00 
6, 000, 000.  00 
5, 000,  ono.  00 
2, 000, 000.  00 
1. 500, 000. 00 


Total  public  issues. 


83,  750, 000. 00 


Total  investments— par  value. 
Unamortized   discount  on  invest- 
ments (net) 

Accrued  intere.st  purchased 


2, 101, 160, 000.  00 
-297, 642.  70 


Total  investments— book  value... 
Undisbursed  balance 


2, 100. 862, 357.  30 
66,352,117.54 


Total  assets. 


2, 167, 214, 474.  84 


$19, 389, 000. 00 

"i9,"389,"o66.'oo" 


19, 389, 000.  00 

"i9,"389."o66.'oo" 


19,  389,  000.  00 
152,  283, 000.  00 


281,  542, 000.  00 


-7, 000, 000. 00 

-10,000,000.00 

-5,000,000.00 


1,500,000.00 

10. 000, 000. 00 

3,  750, 000. 00 

1, 000, 000. 00 


6, 000, 000. 00 
3,  500, 000. 00 


3,  750, 000.  00 


285,  292, 000. 00 


-669,  579.  20 
90, 422. 15 


284,  712, 842.  95 
52, 457, 143.  57 


337, 169, 986.  52 


$19, 389, 
132, 894, 

19, 389, 
132,  894, 

19,389, 
132,  894, 

la,  389, 
132, 894, 

19, 389, 
152,  283, 


000. 00 
000. 00 
000.  00 
000  00 
0(0  00 
000.  00 
000. 00 
000.  00 
000. 00 
000. 00 


2,  298, 952, 000. 00 


5, 000, 000.  00 
5, 000, 000. 00 


18, 250. 
10, 000, 

1, 500, 
10, 000, 
3,  750, 
11,000, 
5, 000. 
5, 000, 
2, 000, 
7, 500, 
3, 500, 


000. 00 
000. 00 

000. 00 
000. 00 
000. 00 
000. 00 
000.  00 
000.  00 
000.  00 
000. 00 
000. 00 


87, 500, 000. 00 


2, 386, 452, 000. 00 

-967,  221.  90 
90, 422. 15 


2, 385,  575,  200.  25 
118, 809, 261. 11 


2, 504, 384, 461.  36 


1  Appropriations  are  equal  to  the  amount  of  employment  taxes  collected,  as  estimated  by  the  Secretary 
of  the  Treasury  and  adjusted  in  accordance  with  wage  reports  certified  by  the  Secretary  of  Health,  Educa- 
tion, and  Welfare,  for  distribution  to  this  fund  and  the  Federal  old-age  and  surviors  insurance  trust  fund. 

«  Reimbursement  covering  fiscal  year  1960  and  including  $876,593  interest. 


614359—62- 


-42 


652    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  72. — Federal  old-age  and  survivors  insurance  trust  fund,   June  SO,   1961 

[On  basi.s  of  daily  Treasury  statements  through  1952,  thereafter  on  basis  of"  Monthly  Statement  of  Recoints 
and  Expenditures  of  the  TTnited  States  Government,"  see  "Bases  of  Tables."  This  trust  fund,  the 
successor  to  the  old-aeie  reserve  account,  was  established  in  accordance  with  the  provisions  of  the  Social 
Security  .Act  Amendments  (42  U.S.C.  401J.  For  further  details  see  annual  reports  of  the  Secretary  for 
1940,  p.  212,  and  1950,  p.  42]  i      i  {  ,       i    •   i    ^f4  i  i  i   ,  a 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  .June  30, 

1960 


Fiscal  year  1961 


Cumulative 

through  .Tune  30, 

1961 


Receipts: 

Appropriations  • 

Deposits  by  States  (42  U.S  C.  418)  '.... 

Interest  and  profits  on  investments    .- 

Transfers  from  general  fund  (42  U.S.C. 
417)  * 

Payments  from  railroad  retirement  ac- 
count (45  U.S.C.  228e  (k)) 

Other* 

Total  receipts 

Expenditures: 
Payments  for: 

Benefits 

Construction  of  building 

Railroad    Retirement    Board    (45 

U.S.C.  228e  (k)) 

Refunding  internal  revenue  collec- 
tions (42  U.S.C.  401  (g)  (2))  6 

Administrative  expenses  (42  U.S.C. 
401  (g)  (D): 

Salaries  and  expenses  ' 

To  general  fund 

To     Department     of    Health, 
Education,  and  Welfare..   ... 
From  Federal  disability  insur- 
ance trust  fund 

Total  expenditures 

Balance ._ 


$71,420,979,960.54 
2. 333.  478.  8.=.3  27 
6,  059,  334,  467.  33 

15, 386. 400. 00 

35,  393.  000.  00 
2,459,191.32 


$10,  623,470,  761  84 

755,  444.  8.50  61 

»  530, 226,  265.  71 


998,  976  00 


$82.  044,  450.  722  38 
3.  088.  923.  703  88 
6,  589,  560,  723.  04 

15, 386,  400.  00 

35. 393, 000  00 
3,458,167  32 


,867.031,872  46 


11,910,140,844.16 


91,777,172,716.62 


56,161,179.01.3.75 
20,  273,  497.  56 


724, 878,  000. 00 
477,  275, 000. 00 


1,161,192.501.91 
528,  393,  512.  51 


14,  572, 325.  00 
-55,457,061.00 


11, 184.  531,124  80 
1,  779. 643.  08 


331,  734, 000.  00 
86,  240, 000. 00 


223.  647,  587.  74 
41, 359,  039.  02 


2, 401. 000.  00 
-33, 176, 322.  00 


67,345.  710, 1.S8  55 
28, 053, 140.  64 

1, 056, 612, 000.  00 

563,  515, 000.  00 


1, 384,  840, 089.  65 
569,  752,  551.  53 


16,  973, 325.  00 
-88, 633, 383.  00 


59, 038,  306,  789.  73 


11,838.516,072.64 


70, 876, 822,  862.  37 


20.  828.  725,  082.  73 


71,  624,  771.  ,52 


20.  900, 349, 8.54.  25 


II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30,  1960 

Fiscal  year  1961, 
increase,  or 
decrease  (— ) 

June  30,  1961 

Investments  in  public  debt  securities: 

Special    issues.    Federal    old-age    and 
survivors  insurance  trust  fund  series 
maturing  June  30: 
Treasury  certificates  of  indebted- 
ness: 
2H%  of  1961-... 

$270, 000, 000. 00 

-$270, 000, 000.  00 
440, 698, 000. 00 

-325. 660. 000.  00 
-168,000.000.00 
-493,681,000.00 

m%  of  1962. 

$440  698  000  00 

Treasury  notes: 

2!.<>%of  1961 

325,  660. 000  00 
168.  000.  000.  00 
965, 000. 000.  00 
168, 000. 000.  00 
465, 000. 000. 00 
168, 000. 000.  00 
168, 000, 000. 00 

500. 000. 000.  00 
965,  000.  000.  00 
965.  000.  000.  00 
168.  000  000.  00 
965, 000,  000.  00 
168. 000. 000. 00 
965. 000. 000.  00 
168, 000. 000,  00 
465.  000.  000  00 
668,000,000.00 

2^i%  of  1961 

2^«%0fl962 

471  319  000  00 

2H%  of  1962.... 

168  000  000  00 

2V>%  of  1963 

-52,989,000.00 

412.011.000.00 

2^^%  Of  1963 

168  000  000  00 

2H%  of  1964- 

168,000  000  00 

Treasury  bonds: 

2;-<^%ofl963 

500  000  000  00 

2H%  of  1964.. 

-52,989,000.00 
-52,989,000.00 

912, 011.000  00 

2>.<i%  of  1965  .           

912  Oil  000  00 

2H%  of  1965 

168.000.000.00 

2).'.%  of  1966 

-52,989,000.00 

912,011,000.00 

2^^%  of  1966-... 

168  000  000. 00 

2K'%  of  1967 

-52,989,000.00 

912.011.000.00 

2H%  of  1967 

168  000  000. 00 

2y2%  of  1968.... 

-52, 989, 000. 00 

412.011.000.00 

2H%  of  1968. 

668,000,000.00 

Footnotes  at  end  of  table. 


TABLES 


653 


Table  72. — Federal  old-age  and  survivors  insurance  trust  fund,  June  SO,  1961 — Con. 
II.  ASSETS  HELD  |  BY  THE  TREASURY  DEPARTMENT— Continued 


Assets 


June  30,  1960 


Fiscnl  year  1961 
increase,  or 
decrease  (— ) 


June  30,  1961 


Investments  in  public  debt  securities— Con. 
Special    issues.     Federal    old  age    and 
survivors  insurance  trust  fund  series 
maturing  June  30— Continued 
Treasury  bonds— Continued 

2M%  of  1969 

2§6%  of  1970 

2^4%  of  1971.-.. 

25/^%  of  1972 

2-56%  of  1973 

2H%  of  1974. 

25^^%  of  1975 

3%%  of  1975 

354%  of  1976... 


,  133, 000. 000.  00 
,  133, 000. 000. 00 
,  133, 000. 000. 00 
,  133. 000. 000. 00 
,  i:!3. 000, 000. 00 
,  133, 000, 000. 00 
919,  934, 000. 00 


-$52. 989, 000. 00 
-52, 989, 000. 00 
-.12,989,000.00 
-52, 9S9, 000. 00 
-52. 989, 000,  00 
-52,989,000.00 


160. 077, 000. 00 
1,080.011,000,00 


$1,080,011. 
1,080,011, 
1,080,011, 
1,080,011, 
1,080,011, 
1,080,011, 
919,934, 
160. 077, 
1,080,011, 


000. 00 
000, 00 
000. 00 
000.  00 
000. 00 
000. 00 
000. 00 
000,  00 
000, 00 


Total  special  issues. 


16,  412,  594,  000. 00 


-212.423,000.00 


16,200,171,000.00 


Public  issues: « 

Treasury  bills 

Treasury  notes: 

4%,  Series  A-1961 

i%%.  Scries  A-1962 

3?^%,  Series  C-1962 

2%%,  Series  A-1963 

4%.  Series  B-1963 

4-4%,  Series  C-1963  

5%,  Series  B-1964-. 

4H%.  Series  A-1965 

Treasury  bonds: 

21.4%  of  1959-62  (dated  June  1, 

1945) 

2>.4<<',  of  1959-62  (dated  Nov.  15, 

1945).. 

2?4%  of  1961.... 

2H%  of  1962-67. 

2H%  of  1963 

2H%  of  1963-68 

2\<>%  of  1964-69  (dated  April  15, 

1943) 

2H%  of  1964-69  (dated  Sept.  15, 

1943) 

2%%  of  1965.... , 

2H%  Of  1965-70 

334%  of  1966.... 

3%  of  1966 

ZH%  of  1966 

2).^%  of  1966-71.... 

2\<>%  of  1967-72  (dated  June  1, 

1945)... 

2^%  of  1967-72  (dated  Oct.  20, 

1941) 

354%  of  1967... 

2!-^%  of  1967-72  (dated  Nov.  15, 

1945).... 

Zli.%  of  1968—. 

4%  of  1969- 

Z'Mo  of  1974.... - 

4M%  of  1975-85 

3H%  of  1978-83 

4%  of  1980 

3H%  of  1980.. 

3M%  of  198.5 

3H%  of  1990.... 

3%  of  1995.... 

3W%  of  1998 

2?4%  Investment  Series  B-1975- 

80... 


23,  550, 000, 00 


119, 100, 
176, 000. 
20, 000, 
30. 000, 
25, 000, 
15,  000. 
25, 000, 
47, 500, 


000.  00 
000. 00 
000. 00 
000. 00 
000.  00 
000. 00 
000.  00 
000. 00 


-23,550,000.00 

-119,100.000.00 
-176.000,000.00 
-20,000.000.00 
-30.  000,  000. 00 
-25,000,000.00 


15, 000.  000. 00 
25, 000, 000. 00 
47,500,000.00 


938,  000. 00 


3,  267, 
2, 000. 

58,  6-"0. 

4,  500, 
116,480, 


000  00 
000. 00 
000.  00 
000.  00 
000. 00 


-938, 000, 00 
-3,  267. 000, 00 


2, 000, 000. 00 


26,  252, 000. 00 


77,  7.52. 
225.  400 
466,  747, 


000. 00 
000.  00 
500. 00 


-58,  6.50. 

-4,  500, 

-116,480, 

-10,  752, 

-46, 752, 


000.  00 
000.  00 
000. 00 

000. 00 

000. 00 


6,  5,50. 
27,  729, 


25, 000, 

"368,'677,' 

10, 100, 

152, 193, 


000. 00 
500,'00" 
000. 00 
250. 00 


000,  00 
000.  00 


4,  500, 
7, 000, 


000.  00 
000. 00 


5,  550, 000. 00 


21,085,000.00 
10, 450, 000. 00 
36,  500, 000.  00 
25.  000. 000. 00 
25, 000, 000. 00 
45, 100. 000.  00 
18, 000, 000. 00 


47, 4.50, 
34,  205. 

3,  200, 
5, 000. 
1, 000, 


000,  00 
000,  00 

000.  00 
000. 00 
000. 00 


15, 500, 000. 00 

31. 000, 000. 00 

22.5, 400. 000. 00 

463, 297,  500.  00 

27,  729. 000. 00 

25, 000, 000. 00 

4,  500, 000. 00 

315, 077,  500. 00 

15,650,000.00 

199,  643,  250. 00 
34,  205, 000. 00 


15, 100, 000, 00 


63,  850, 000.  00 
85, 170, 000. 00 


67.4-0,000.00 
25, 700, 000.  00 
219,280,000.00 


174,454,000.00 


24,  285, 
15, 4.^0, 
37.  500. 
25, 000. 
25, 000. 
60, 200, 
18, 000, 
67,  4=^.0, 
25, 700, 

283, 130, 
85, 170, 

174, 454, 


000. 00 
000. 00 
000, 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 


1, 064. 902, 000. 00 


1, 064, 902, 000. 00 


Total  public  issues. 


Total  investments — par  value 
Unamortized  premium  and  discount 

(net) 

Accrued  interest  purchased 


3, 343, 564,  250. 00 

19,  756, 158,  250.  00 

-7,310,522,92 


9,179.000,00 
—203,  244, 000. 00 


-23,019,401.41 
932,355,11 


3, 352,  743, 250. 00 
19,552,914,250.00 


-30,329,924.33 
932, 355. 11 


Total  investments— book  value.. 
Footnotes  at  end  of  table. 


-     19,  748, 847.  727. 08 


-225, 331, 046.  30 


19,  523,  516, 680. 78 


654   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  72.— Federal  old-age  and  survivors  insurance  trust  fund,  June  SO,  1961 — Con. 
II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT— Continued 


Assets 

June  30,  1960 

Fiscal  year  1961, 
increase,  or 
decrease  (— ) 

June  30,  1961 

Unexpended  balance 

«  $1,079,  877, 355. 65 

$296, 955, 817. 82 

»  $1, 376, 833, 173. 47 

Total  assets 

20,828,725,082.73 

71,  624,  771.  52 

20,900,349,854  25 

'  Appropriations  are  equal  to  the  amount  of  employment  taxes  collected  as  estimated  by  the  Secretary  of 
the  Treasury  and  adjusted  in  accordance  with  wage  reports  certified  by  the  Secretary  of  Health,  Education, 
and  Welfare,  for  distribution  to  this  fund  and  the  Federal  disability  insurance  trust  fund. 

2  To  cover  employees  of  States  and  their  political  subdivisions,  Social  Security  Amerdments  of  1950. 

'  Excludes  repayment  of  amortized  premium  and  discount  (net)  amounting  to  $23,019,401.41. 

*  In  connection  with  payments  of  benefits  to  survivors  of  certain  World  War  II  veterans  who  died  within 
three  years  after  separation  from  active  service. 

*  Incidental  recoveries,  etc.,  and,  beginning  with  the  fiscal  year  1958,  includes  reimbursement  of  interest 
transferred  from  the  Federal  disability  insurance  trust  fund  pursuant  to  sec.  201  (p)  (1)  of  the  Social  Security 
Act  as  amended.  Such  transfers  amounted  to  $724,045.00  for  the  fiscal  year  1960  and  $876,593.00  for  the 
fiscal  year  1961. 

6  Beginnine  in  1953. 

'  Paid  directly  from  the  trust  fund  beginning  with  the  fiscal  year  1947  under  annual  appropriation  acts. 
'  Public  issues  held  by  the  fund  are  shown  at  face  value,  unamortized  premium  and  discount  (net)  are 
shown  separately  below. 

*  Includes  the  following  balances  in  the  accounts  as  of  June  30: 

1960  1961 

Benefit  payments. $1, 068, 427,  640.  47    $1,  360,  716, 164. 82 

Salaries  and  expenses 10,  932,  500.  98  15,  824,  537.  53 

Construction  of  building 517,  214.  20  292, 471. 12 


Table  73. — Foreign  service  retirement  and  disability  fund,  June  SO,  1961 

[This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  May  24,  1924,  and  the  act 
of  Aug.  13, 1946  (22  U.S.C.  1062).    For  further  details,  see  annual  report  of  the  Secretary  for  1941,  p.  138] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

througli  June 

30,  1960 


Fiscal  year 
1961 


Cumulative 

through  June 

30,  1961 


Receipts: 

Deductions  from  salaries,  service  credit  payments, 
and  voluntary  contributions  of  emploj'ees  subject 

to  retirement  act 

Appropriations 

Interest  and  profits  on  investments 

Total  receipts 

Expenditures: 

Annuity  payments  and  refunds 

Balance 


$26.  268,  335. 00 
23,  275, 900.  00 
12,611,048.81 


$3,  540,  476.  67 
2,  540, 000.  00 
1,  247, 307. 14 


$29,808,811.67 
25,815,900.00 
13, 858,  355. 95 


62, 155,  283. 81 
32,  774, 756. 90 


7,  327, 783. 81 
4,  253,  2.50. 80 


69, 483, 067.  62 
37. 028, 007.  70 


29,  380,  526. 91 


3, 074,  533. 01 


32,  455, 059. 92 


n.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year 
1961,  increase, 
or  decrease  (— ) 

June  30,  1961 

Investments  in  public  debt  securities: 

Special  issues,  Treasury  certificates  of  indebtedness, 
foreign  service  retirement  fund  series  maturing 
June  30: 
3%  of  1961- 

$1,  355, 000.  00 
27, 823, 000  00 

-$1,355,000.00 

-27.82.3,000.00 

1,  423, 000.  00 

30,  757, 000. 00 

4%  of  1961—    . 

3%  of  1962 - — 

$1,  423, 000.  00 

4%  of  1962 

30,  757,  000. 00 

Total  investments 

29, 178,  000.  00 
202,  526. 91 

3, 002,  000.  00 
72,  533.  01 

32,  ISO,  000.  00 

Undisbursed  balance ...  .    

275, 059. 92 

Total  assets 

29, 380,  526. 91 

3, 074,  533.  01 

32, 455,  059. 92 

TABLES 


655 


Table  74. — Highway  trust  fund,  June  SO,  1961 

[This  trast  fund  was  established  in  accordance  with  the  provisions  of  the  Highway  Revenue  Act  of  1956 

(23  U.S.C.  120  note)] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  .Tune  30, 

1960 


Fiscal  year  1961 


Cumulative 

through  June  30, 

1961 


Receipts: 

Excise  taxes: ' 

Gasoline 

Diesel  fuel - - 

Tires 

Tread  rubber 

Trucks,  buses,  etc.- - - 

Truck  use  

Inner  tubes 

Other  tires 

Total  taxes. - 

Deduct:  Reimbursement    to    general    fund- 
refund  of  tax  receipts: 

Gasoline  used  on  farms 

Gasoline    for    nonhighway    purposes   or 

local  transit  systems 

Gasoline,  other     

Tires  and  tread  rubber 

Trucks,  buses,  etc.- -- 

Total  refunds  of  taxes 

Total  taxes  (net) 

Interest  on  investments — 

Advances  from  general  fund.  - 

Less:  Return  of  advances  to  general  fund.. 

Total  receipts  (net).. 

Expenditures: 

Highway  program: 

Reimbursement  to  general  fund 

From  trust  fund 

Total  highway  program 

Services  of  Department  of  Labor  (administra- 
tive and  enforcement  of  labor  standards)... 
Interest  on  advances  from  general  fund 

Total  expenditures 

Balance 


$6,711,181,294.42 
212,841.772.65 
672,915.370.70 

53. 865,  045.  64 
394.271.645.89 
130,289.849.18 

51,078,962.98 
182,024,301.53 


1  $2,401 

84. 
168. 

13. 
115. 

46. 

14. 

77, 


,458.264.  92 
904.510  13 
068.014.56 
813.611.49 
598.1.57.43 
763,  007.  38 
714.182  36 
916,143.67 


$9. 112.  639.  559. 34 
297.  746. 282.  78 
840. 983,  385,  26 

67,678,687.13 
509.  869. 803.  32 
177,057.856.56 

65,793.145.34 
259, 940,  445.  20 


8,  408.  468. 242.  99 


2, 923.  240. 921. 94 


11, 331.  709. 164.  93 


234, 086, 871. 44 

56,0.52.361.12 
38.814.16 
97.  41 6  90 
26.  660.  21 


98, 237,  757.  72 

27,455,914.27 
9, 469. 06 


332, 324, 629. 16 

83, 508, 275.  39 
48.  283.  22 
97.416.90 
26, 660.  21 


290. 302, 123.  83 


125.703.141.05 


416.00.5,264.88 


,118.166.119.16 

36.218.56.5.44 

359.  000.  000.  00 

-359. 000,  000.  00 


2,  797,  537,  780.  89 

2,017,718.38 

60. 000.  000.  00 

-60,  000.  000.  00 


10, 915,  703. 900.  05 

38. 236. 283.  82 

419, 000. 000. 00 

-419, 000.  000.  00 


8,154,384,684.60 


2,  799,  555,  499.  27 


10,  953,  940, 183.  87 


501,018,653.13 
7,  .528,  710,  385.  22 


2,619,170,183.37 


501,018,553.13 
10,147,880.568.59 


8, 029.  728,  938.  35 


2,619,170,183.37 


10,648,899,121.72 


368, 225.  00 
5,  066,  704. 82 


543, 457. 20 


368. 225.  00 
5,  610, 162.  02 


8,035.163,868.17 


2,619,713,640.57 


10,  654, 877,  508.  74 


119, 220,  816.  43 


179,841,858.70 


299, 062, 675. 13 


n.  ASSETS  HELD  BY  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year  1961, 
increase,  or 
decrease  (— ) 

June  30, 1961 

Investments  In  public  debt  securities: 

Special   issues,    Treasury   certificates   of  in- 
debtedness,   highway  trust  fund  series, 
maturing  June  30: 
ZM%  of  1961 

$1,335,000.00 

-$1. 335, 000. 00 
234, 034,  000.  00 

3%  of  1962 

$234.  034, 000. 00 

Total  investments 

1,335.000.00 
117,88.5,816.43 

232, 699, 000.  00 
-52,857,141.30 

234, 034. 000  00 

Undisbursed  balances     

65,  028,  675. 13 

Total  assets    

119,220,816.43 

179,841,858.70 

299, 062,  675. 13 

'  Revised  for  reclassification. 

'  Amounts  equivalent  to  specified  percentages  of  receipts  from  certain  taxes  on  motor  fuels,  vehicles, 
tires  and  tubes,  and  use  of  certain  vehicles  are  appropriated  and  transferred  monthly  from  general  fund 
receipts  to  the  trust  fund  on  the  basis  of  estimates  by  the  Secretary  of  the  Treasury,  with  proper  adjust* 
ments  to  be  made  in  subsequent  transfers  as  required  by  sec.  209(c)(3)  of  the  Highway  Revenue  Act  of  1956. 

*  Includes  floor  taxes. 


656 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  75. — Judicial  survivors  annuity  fund,  June  SO,  1961 

\.This  fund  was  established  in  accordance  with  the  provisions  of  tho  act  of  Aug.  3,  1956  (28  U.S.C.  376(b))] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30,  1960 

Fiscal  year 
1961 

Cumulative 

through  .lune 

30,  1961 

Receipts: 

Deductions  from  salaries  and  contributions 

Interest  and  profits  on  investments..  .    __  .. 

$2, 451, 918. 08 
96.549.17 

$502,  559  08 
48,  604.  47 

$2, 954,  477.  16 
145,  153.  64 

Total  receipts 

2,  548,  467.  25 
1,167,951.11 

551, 163.  55 
347,110.43 

3, 099,  630. 80 

Expenditures: 

1,515,061.54 

Balance .  .  . 

1, 380,  516. 14 

204,  053. 12 

1,  584,  569.  26 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


June  30,  1960 


Fiscal  year 
1961,  increase, 
or  decrease  (— ) 


June  30,  1961 


Investments  in  public  debt  securities: 
Public  Issues; 

Tn^a'^ury  bills 

Certificates  of  indebtedness,  4Ji%,  Series  B-1961. 

Treasury  notes: 

4%,  Series  A-1961.- 

3^^%,  Series  A-1962 

3W%,  Scries  D-1963 

5%,  Scries  B-1964 

4H%,  Series  A-1965... - 

Treasury  bonds: 

2^4%  of  1963 - 

3%  of  1064 - — . 

254%  of  1965 — — . 

33*%  of  1966 - 

Zli%  of  1968 

4%  of  1969-.- 

3?i%  of  1974 

3M%  of  1978-83 

4%  of  1980.... 

Zyi%  of  1990 

3%  of  1995.. 

3^%,  of  1998 — 


Total  investments. 
Undisbursed  balance 


Total  assets- 


$48,  000.  00 
150. 000. 00 


100.  000.  00 
60,  000  00 


-$150, 000. 00 


63.  000.  00 
100,  000.  00 

250,  000.  00 
100,  000.  00 
77,  000.  00 


95,  000.  00 
40,  500  00 
67. 000.  00 

49,  500.  00 

50,  500.  00 
44,  500  00 
51, 000. 00 


1,  346,  000.  00 
34,516.14 


1,  380,  516. 14 


150,  000.  00 


-250,  000. 00 
'250'oOOro5" 


44. 000.  00 
"52,'500"65" 


113.500.00 


210,  000.  00 
-5,946.88 


204, 063. 12 


$48, 000.  00 


100. 000.  00 
60, 000.  00 

150.  000.  00 
63,  000.  00 

100,  000.  00 


100,  000.  00 
77,  000.  00 

250,  000.  00 
95,  000.  00 
40.  .500.  00 
67,  00(1.  00 
93,  500.  00 
50,  500.  00 
97,  000.  00 
51,000.00 

113,500.00 


1,  556,  000. 00 
28,  569.  26 


1,  584,  569.  26 


TABLES 


657 


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658   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  77. — Longshoremen^ s  and   Harbor   Workers^   Compensation  Act,   relief  and 

rehabilitation,  June  SO,  1961 
[This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  Mar.  4,  1927,  as  amended 

(33  U.S.C.  944).     For  further  details,  seo  annual  report  of  the  Secretary  for  1941,  p.  141] 
I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30,  1U80 

Fiscal  year 
1961 

Cumulative 

through  June 

30,  1961 

Receipts: 

Deposits .  . 

$861, 258. 79 
316,  402.  34 

$6, 000.  00 
19,  327. 47 

$867  258  79 

Interest  and  profits  on  investments ... 

335  729  81 

Total  receipts .  ._  .. 

1, 177,  661.  13 
485, 943. 86 

25, 327.  47 
125, 864.  21 

1,  202,  988.  60 
611,808.07 

Expenditures 

Balance 

691,  717. 27 

-100,536.74 

591  180  53 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30, 1960 


Fiscal  year 
1961,  increase, 
or  decrease  (— ) 


June  30, 1961 


Investments  in  public  debt  securities: 
Public  issues; 

Treasury  notes: 

m%,  Series  A— 1964 

5%,  Series  B— 1964... 

3?4%.  Series  D— 1964... 

Treasury  bonds: 

2H%  of  1962-67 

2!^%  of  1964-69  (dated  Apr.  15,  1943). 

2%%  Of  1965... 

2H%  of  1966-71 

3'4%  of  1968 

4%  of  1969 

3H%  of  1978-83 

35^%  of  1980 - 

3%  of  1995.. 

3!.i%  of  1998.... 

2%%  Investment  Series  B— 1975-80.. 

U.S.  savings  bonds: 

Series  O  (2.i0%) 

Series  K  (2.76%) 


Total  investments. 
Undisbursed  balance 


Total  assets. 


$10,  000. 00 
20, 000.  00 
20,  000. 00 

23, 000. 00 
11,500.00 
50, 000.  00 
82,  000.  00 
22,  500.  00 


25,  000. 00 

'ioi'ooo."o5" 


108, 000.  00 


145,  700.  00 
71,  500.  00 


690,  200.  00 
1,517.27 


691,  717.  27 


-$23,  000.  00 
-11,500.00 


100,  000. 00 

"'23"6on.'oo' 
"n,"500."oo" 


-145,700.00 
-57,  000.  00 


-102,700.00 
2, 163.  26 


-100,536.74 


$10, 000.  00 
20, 000.  00 
20, 000. 00 


50,  000.  00 
82,  000.  00 

22,  500.  00 

100,  000.  00 
25, 000.  00 

23,  000.  00 

101,  000.  00 
11,500.00 

108,  000. 00 


14.  500.  00 


587,  500. 00 
3,  680.  53 


591, 180.  53 


Table  78. — National  Archives  gift  fund,  June  SO,  1961 

[This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  July  9,  1941,  as  amended 

(44  U.S.C.  300aa-300ee)l 
I.  RECEIPTS  AND  EXPENDITURES 


Cumulative 

through  June 

30,  1960 


Fiscal  year 
1961 


Cumulative 

through  June 

30,  1961 


Receipts— Donations 
Expenditures 

Balance 


$410,430.61 
307,  402. 93 


$58,  605. 60 
101,  298.  81 


$469, 036.  21 
408,  701.  74 


103, 027.  68 


-42,  693.  21 


60, 334.  47 


n.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 

Assets 

June  30, 1960 

Fiscal  year 
1961,  decrease 

June  30, 1961 

Undisbursed  balance 

$103, 027. 68 

-$42,  693.  21 

$60, 334.  47 

TABLES 


659 


Table  79. — National  park  trust  fund,  June  SO,  1961 

[This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  July  10,  1935,  as  amende  d 
(16  U.S.C.  19-19a).    For  further  details,  see  annual  report  of  the  Secretary  for  1941,  p.  153] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30,  1960 

Fiscal  year 
1961 

Cumulative 

through  June 

30, 1961 

Receipts: 

Donations . .  _ 

$97, 015.  56 
11,  303. 09 

$3, 872. 00 
538.  75 

$100, 887.  56 
11  841  84 

Interest  on  investments  _ 

Total  receipts..  .  . 

108, 318.  65 
37, 017. 14 

4,  410.  75 
2, 217.  51 

112, 729.  40 
39,  234.  65 

Expenditures .. .  _  _ 

Balance .__._....-. . 

71, 301.  51 

2, 193.  24 

73, 494.  75 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year 
1961,  increase 

June  30,  1961 

Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bonds: 

2?4%  of  1961 - 

$1, 500. 00 
1,  000. 00 

15,  000. 00 
1, 000. 00 
1, 000.  00 
1,000.00 
25.00 

$1,  500. 00 

2],<i%  of  1963-68 

1, 000. 00 

2}4%  of  1966-71 ... 

15, 000.  00 

2H%  of  1967-72  (dated  Oct.  20,  1941) 

1, 000. 00 

4%  of  1969.. 

1, 000. 00 

3H%  of  1978-83.. 

1, 000.  00 

U.S.  savings  bonds,  Series  J  (2.76%) 

25.00 

Total  investments 

20,52.^00 
50,  776.  51 

20,  525. 00 

Undisbursed  balance 

$2, 193.  24 

52, 969.  75 

Total  assets 

71, 301.  51 

2, 193.  24 

73,  494.  75 

Table  80, — National  service  life  insurance  fund,  June  30,  1961 

[This  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  Oct.  8, 1940  (38  U.S.C.  720). 
For  further  details,  see  annual  repoit  of  the  Secretary  for  1941,  p.  143] 

L  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June  30, 

1960 

Fiscal  year  1961 

Cumulative 

through  June  30, 

1961 

Receipts: 

Premiums  and  other  receipts 

$8,912,367,057.65 
2,  610, 967, 107. 28 
4,  725,  522, 495. 37 

$483, 795,  509.  41 

175,  394, 965. 92 

8,448,898.53 

$9, 396, 162, 567. 06 

Interest  on  investments 

2,  786,  362,  073.  20 

Payments  from  general  fund 

4,733,971,393.90 

Total  receipts 

16,248,856,660.30 
10, 435, 894, 680. 09 

667, 639, 373. 86 
707, 467, 380.  39 

16, 916, 496, 034. 16 
11,143,362,060.48 

Expenditures: 

Benefit  payments,  dividends,  and  re- 
funds  

Balance 

5, 812,  961, 980.  21 

-39, 828, 006.  53 

5,  773, 133, 973. 68 

660   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  80. — National  service  life  insurance  fund,  June  SO,  1961 — Continued 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year  1961, 
increase,  or 
decrease  (-) 

June  30, 1961 

Investments  in  public  debt  securities: 

Special  issues,  national  service  life  in- 
surance fund  .series  maturing  June  30: 
Treasury   certificates  of  indebted- 
ness, 3%%  of  1961 

$7, 867, 000. 00 

379. 000, 000.  00 
379, 000, 000.  00 

7, 873, 000. 00 
379, 000, 000.  00 

7,  873,  000.  00 
379, 000, 000.  00 

7, 873,  000.  00 

7, 873, 000.  00 

379,000,000.00 
379,000.000.00 

7. 873, 000.  00 
379, 000, 000.  00 

7,  873,  000.  00 
379, 000, 000.  00 

7,  873, 000.  00 
379, 000, 000. 00 

7, 873, 000.  00 
379. 000, 000.  00 

7, 873, 000.  00 
379, 000, 000. 00 

7, 873, 000.  00 
379, 000, 000.  00 

7, 873, 000.  00 
379, 000, 000.  00 

7, 873, 000.  00 
379. 000, 000. 00 

7, 873, 000. 00 
386, 873, 000. 00 

-$7, 867, 000. 00 
-379,000,000.00 

Treasury  notes: 

3%  of  1961 

3%  of  1962 --. 

$379, 000, 000. 00 
7,873  000  00 

3%%  of  1962 --._ 

3%  of  1963      .- 

379  000  000  00 

334%  of  1963 

7  873  000  00 

3%  Of  1964 

379, 000, 000.  00 
7, 873. 000.  00 
7, 873, 000. 00 

379  000  000  00 

3?^%  of  1964 

3%%  of  1965 

Treasury  bonds: 

3%  of  1965 - 

3%  of  1966 

379,000,000  00 

3?4%of  1966 -..     - 

7  873  000  00 

3%  of  1967.. 

379,000,000  00 

3%%  of  1967 

7  873  000  00 

3%  of  1968 

379  000  000  00 

ZViJo  of  1968 

7,873,000  00 

3%  of  1969  . 

379  000  000  00 

3%%  of  1969 

7,873,000  00 

3%  of  1970         ,  - 

379  000  000  00 

3?^%  of  1970 

7,873  000  00 

3%  of  1971 - 

379,000,000  00 

3%%  of  1971 

7,873  000  00 

3%  of  1972 

379,000  000  00 

3?4%  of  1972               .     -. 

7, 873, 000.  00 
379  000  000  00 

3%  of  1973 

3?4%of  1973 

7, 873, 000.  00 

3%  of  1974      

379  000  000  00 

3^4%  of  1974 

7,873,000  00 

334%  of  1975 - 

386. 873, 000.  00 

3^i%ofl976 

343, 149, 000.  00 

343  149,000  00 

Total  investments 

5, 803, 089, 000. 00 
9. 872,  980.  21 

-43,  718, 000.  00 
3,  889,  993.  47 

5  759  371  000  00 

Undisbursed  balance 

13,  762,  973.  68 

Total  assets... 

5, 812, 961, 980. 21 

-39, 828, 006.  53 

5,  773, 133, 973.  68 

Note.— Policy  loans  outstanding,  on  basis  of  information  furni.shed  by  the  Veterans'  Administration 
amounted  to  $368,393,208.84  as  of  June  30,  1961. 

Table  81. — Pershing  Hall  Memorial  fund,  June  SO,  1961 

[This  special  fund  vfas  established  in  accordance  v^ith  the  provisions  of  the  act  of  June  28,  1935,  as  amended 
(36  U.S.C.  491).    For  further  details  see  annual  report  of  the  Secretary  for  1941,  p.  155] 


I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 

Cumulative 

through  June 

30,  1960 

Fiscal  year 
1961 

Cumulative 

through  June 

30,  1961 

Receipts: 

Appropriations 

$482. 032. 92 

5, 783.  21 

12, 000  35 

122,688.88 

$482, 032.  92 

Profits  on  investments 

5  783  21 

Net  increase  in  book  value  of  bonds 

12, 000.  35 

Interest  earned -  . 

$7,385.00 

130,073  88 

Total  receipts 

622,  505.  36 

7. 385.  00 

629,890  36 

Expenditures: 

Claims  and  expenses 

288,  629.  70 
122,688.88 

288, 629.  70 

National  Treasurer,  American  Legion 

7,385.00 

130, 073. 88 

Total  expenditures 

411.318.58 

7, 385.  00 

418,  703. 58 

Balance 

211, 186.  78 

211, 186.  78 

4 


TABLES 


661 


Table  81. — Pershing  Hall  Memorial  fund,  June  SO,  1961 — Continued 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year 
1961 

June  30,  1961 

Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bonds,  3^%  of  1990 

$211,000.00 
186.  78 

$211, 000.  00 

186.  78 

Total  assets                  -        

211, 186.  78 

211,186.78 

Table  82. — Philippine  Government  pre-1934  bond  account,  June  SO,  1961 

[This  special  trust  account  was  established  in  accordance  with  the  provisions  of  the  act  of  August  7,  1939 
(22  U.S.0. 1393),  for  the  payment  of  bonds  issued  prior  to  May  1, 1934,  by  provinces,  cities,  and  munici- 
palities of  the  Philippines] 

I.  RECEIPTS    AND    EXPENDITURES    (EXCLUDING    INVESTMENT    TRANSACTIONS) 


Cumulative 

through  June 

30, 1960 


Fiscal  year 
1961 


Cumulative 

through  June 

30, 1961 


Receipts: 

Taxes  on  exports 

Interest  and  profits  on  investments  ' 

Sale  of  stock  of  Bank  of  Philippine  Islands. 

Deposit  of  the  Philippine  Government 

U.S.  Treasury  bonds  from  the  Philippine  Govern- 
ment  

Annual  payments  by  the  Philippine  Government. 

Total  receipts 

Expenditures: 

Interest  on  outstanding  Philippine  bonds 

Return  of  excess  cash  to  the  Philippine  Government 
Payment  of  matured  bonds  of  the  Philippine  Gov- 
ernment  

Cancellation  of  Philippine  bonds  at  cost  ^ 

Losses  on  securities  sold 

Unamortized  discount  on  investments 

Total  expenditures 

Balance. 


$1, 586, 135. 92 

3,  598, 525. 17 

43, 100. 00 

13, 141. 85 

6,  269, 750. 00 
15,  646, 589. 37 


$45,778.11 


$1, 586, 135. 92 

3,  644, 303.  28 

43, 100.  00 

13, 141. 85 

6,  269, 750.  00 
15,  646, 589. 37 


27, 157,  242. 31 


45,778.11 


27,  203, 020. 42 


2,  304, 018. 80 
1, 000, 000. 00 

18, 250,  500. 00 

3,  533,  685. 13 

77, 876. 84 
-431.  70 


51, 475. 00 


278,  000. 00 


2, 087.  50 
431.  70 


2, 355, 493. 80 
1, 000,  000. 00 

18, 528, 500. 00 

3,  533,  585. 13 

79, 964. 34 


25, 165,  549.  07 


331, 994. 20 


25, 497,  543.  27 


1, 991, 693.  24 


-286,  216.  09 


1, 705, 477. 15 


IL  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year 
1961,  decrease 

June  30, 1961 

Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bills .            .  .      . 

$33, 000. 00 

35,  000. 00 
100, 000. 00 

805, 000. 00 

148,  300. 00 

648, 000.  00 

75,000.00 

-$33, 000. 00 
-35, 000.  00 

Treasury  notes: 

4%%,  Series  C-1960 

4?4%,  Series  A-1964 

$100, 000. 00 

Treasury  bonds: 

2)4%  of  19.59-62  (dated  Nov.  15, 1945).. 

2V2%  of  1962-67 

-205,  000. 00 

600,000.00 
148, 300. 00 

2)^%  of  1963-68-  - 

648, 000. 00 

U.S.  savings  bonds.  Series  G  (2.50%)-.- -- 

75,  000.  00 

Total  investments    .- 

1, 844.  300. 00 
147,393.24 

-273, 000. 00 
-13,216.09 

1,571.300.00 

Undisbursed  balance _  .    ._ 

134, 177. 15 

Total  assets, 

1, 991, 693.  24 

-286, 216. 09 

1,  705, 477. 15 

1  Losses  are  netted  against  profits  through  fiscal  1957. 

2  The  face  value  of  the  bonds  canceled  was  $3,436,000. 

Note.— As  of  June  30, 1961,  the  total  principal  of  pre-1934  bonds  outstanding  was  $638,850  unmatured  and 
$62,000  matured.  The  amount  of  matured  interest  unpaid  was  $48,647.50  and  the  unmatured  interest 
projected  through  July  1, 1963,  the  date  of  final  maturity,  amounted  to  $79,850.25. 


662   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  83. — Public  Health  Service  gift  funds,  June  SO,  1961 

IThis  trust  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  May  26,  1930,  which  was 
repealed  by  the  act  of  July  1, 1944  (42  U.S.C.  219,  283(b),  287b,  288b),  under  which  it  now  operates] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through 
June  30,  1960 

Fiscal  year 
1961 

Cumulative 

through 
June  30,  1961 

Receipts: 

Contributions 

$892,  873.  26 
102,  361.  25 

$49, 353. 32 
4,  516.  64 

$942,  226. 58 

Interest  on  investments 

106, 877. 89 

Total  receipts... 

995,  234.  51 
782,  676. 49 

53, 869.  96 
63, 848. 47 

1,  049, 104. 47 

Expenditures 

836,  524. 96 

Balance.. 

212,  558.  02 

21.49 

212,  579. 51 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30,  1960 

Fiscal  year 
1961,  increase, 
or  decrease  (— ) 

June  30,  1961 

Investments  in  public  debt  securities: 
Public  issues: 

Treasury  bUls 

$80,  000. 00 
61, 000. 00 

$25, 000. 00 

$105, 000.  00 
61, 000. 00 

Treasury  bonds,  2}.^%  of  1967-72  (dated 
June  1,  1945)... 

Total  investments    

141, 000.  CO 
71,  558.  02 

25,  000. 00 
-24,978.51 

166, 000. 00 

Undisbursed  balance 

46,  579.  51 

Total  assets.. 

212,  558.  02 

21.49 

212,  579. 51 

Table  84. — Railroad  retirement  account,  June  30,  1961 

[On  basis  of  daily  Treasury  statements  through  1952,  thereafter  on  basis  of  "Monthly  Statement  of  Receipts 
and  Expenditures  of  the  United  States  Government,"  see  "Bases  of  Tables."  This  trust  account  was 
established  in  accordance  with  the  provisions  of  the  act  of  June  24,  1937  (45  U.S.C.  228o).  For  further 
details,  see  annual  report  of  the  Secretary  for  1941,  p.  148] 

L  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30,  1960 

Fiscal  year 
1961 

Cumulative 

through  June 

30, 1961 

Receipts: 

Appropriations  ' 

$10, 161, 617,  729. 90 

100.  00 

1,  227, 063, 265. 43 

724, 878, 000. 00 

899, 891.  24 
85,231,000.00 

$570, 165, 005.  93 

250.  00 

110, 920, 670. 59 

336, 882, 000. 00 

1,  020,  481. 76 
31,  205, 000.  00 

$10,  731, 782, 735. 83 

Fines  and  penalties 

350. 00 

Interest  and  profits  on  investments    

1,  337, 983, 936.  02 

Payments  from   Federal  old-age  and  sur- 
vivors and  Federal  disability  insurance 
trust  funds  ^ 

1, 061,  760, 000. 00 

Railroad  unemployment  insurance  account: 
Interest  on  advances... 

1, 920,  373. 00 

Repayment  of  advances  „ 

116,436,000.00 

Total  receipts 

12, 199,  689, 986.  57 

1, 050,  193, 408.  28 

13, 249, 883,  394. 85 

Expenditures: 

Benefit  payments,  etc  ....         

7, 961, 920, 960. 44 
74, 604,  229. 46 

26, 831, 000.  00 
35, 393, 000.  00 

183,  730, 000. 00 

981, 839,  329.  28 
9, 948, 076. 01 

8, 943,  760, 289.  72 

Administrative  expenses  s 

84,  652, 305. 47 

Federal  old-age  and  survivors  and  Federal 
disability  insurance  trust  funds: 
Payments            .      . 

26,  831, 000. 00 

Interest  payments 

35,  393, 000.  00 

Advances  to  railroad  unemployment  insur- 
ance account 

132, 345, 000. 00 

316, 075,  000.  00 

Total  expenditures 

8, 282,  479,  189. 90 

1, 124, 132,  405.  29 

9,406,611,696.19 

Balance 

3, 917, 210,  796.  67 

-73,938,997.01 

3, 843,  271,  799.  66 

Footnotes  at  end  of  table. 


TABLES 


663 


Table  84. — Railroad  retirement  account,  June  SO,  1961 — Continued 
II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30,  1960 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


June  30,  1961 


Investments  in  public  debt  securities: 

Special  Issues,  Treasury  notes,  railroad  retire- 
ment series,  maturing  June  30: 

3%  of  1961 

3%  of  1962 

3%  of  1963...- 

3%  of  1964 - -.- 

3%  of  1965 - 

3%  of  1966 


$158,581,000.00 

1, 178.  450, 000.  00 

751,106.000.00 

1,411,532,000.00 

86, 298, 000. 00 


-$158,681,000.00 
-989,115,000.00 


980, 347, 000. 00 
84,  916, 000.  00 


$189, 335,  000.  00 

751, 106,  000.  00 

1,411,532,000.00 

1. 066,  645, 000.  00 

84, 916, 000. 00 


Total  special  issues  . 


3, 585. 967, 000. 00 


-82,  433, 000.  00 


3,  503,  534, 000. 00 


Public  issues: 

Treasury  bills 

Treasury  notes: 

4%,  Series  B-1963 

4%%,  Series  C-1963 

6%,  Series  B-1964 

4^%,  Series  C-1964 

Treasury  bonds: 

2H%  of  1965 - -- 

3%  of  1966 

2H%  of  1967-72  (dated  June  1,  1945).. 
2H%  of  1967-72  (dated  Oct.  20,  1941) . 
21,^%  of  1967-72  (dated  Nov.  15,  1945). 

3Ji%  of  1968 

4%  of  1969 -. 

3%%  of  1974 --- 

41.4%  of  1975-85. -- 

3H%  of  1980 -- 

4%  of  1980.. 

3H%  of  1985 

ZM%  of  1990 

3%  of  1995 

31^%  of  1998 


15,  700,  000.  00 

20. 000.  000.  00 

13,  500, 000.  00 

20, 000, 000.  00 

7, 450, 000. 00 

11,  500. 000.  00 
8,  500, 000. 00 

10, 100. 000.  00 
2,  265, 000.  00 

13, 085, 000.  00 


-15,700,000.00 


20, 000, 000.  00 

13,  500, 000.  00 

20, 000, 000.  00 

7, 450, 000. 00 


35, 000, 000.  00 
25, 000, 000.  00 
20, 000, 000. 00 


5, 000, 000. 00 


11,  450, 000.  00 
6, 900, 000.  00 

28, 150, 000. 00 
3, 200, 000. 00 


6, 000, 000. 00 


2, 775, 000. 00 

"6,'i66,'o6o.'o6" 


11, 500, 

8,  500, 
10, 100, 

2.  265. 
13,  085, 

5, 000, 
35, 000, 
25, 000. 
20. 000, 

6, 000. 
11,  450. 

6, 900. 
30,  925, 

3, 200. 

6, 100, 


000.  00 
000. 00 
000.  00 
000.  00 
000. 00 
000. 00 
000.  00 
000.  00 
000.  00 
000  00 
000.  00 
000.  00 
000.  00 
000.  00 
000. 00 


Total  public  issues. 

Total  Investments - 
Undisbursed  balance 


251, 800, 000.  00 


4,175.000.00 


255, 975,  000. 00 


3, 837,  767, 000.  00 
79, 443,  796.  67 


-78,2.58,000.00 
4, 319, 002.  99 


Total  assets. 


3,917,210,796.67       -73,938,997.01 


3,  759,  509, 000.  00 
83,  762,  799.  66 


3, 843,  271, 799.  66 


•  Includes  the  Government's  contribution  for  creditable  military  service  under  the  act  of  April  8,  1942, 
as  amended  by  the  act  of  August  1,  1956  (45  U.S.C.  228c-l(n)(p)).  Effective  July  1,  1951,  appropriations 
of  receipts  are  equal  to  the  amount  of  taxes  deposited  in  the  Treasury  (less  refunds)  under  the  Railroa  d 
Retirement  Tax  Act  (26  U.S.C.  3201-3233).    Amounts  shown  are  exclusive  of  unappropriated  receipts. 

«  Pursuant  to  act  of  June  24,  1937  (45  U.S.C.  228e(k)). 

'  Beginning  Aug.  1,  1949,  paid  from  the  trust  fund  under  Title  IV,  act  of  June  29, 1949  (63  Stat.  297) , 
and  subsequent  annual  appropriation  acts. 


664   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  85. —  Unemployment  trust  fund,  June  30,  1961 

[On  basis  of  daily  Treasury  statements  through  1952;  tlicreafter  on  basis  of  "Monthly  Statement  of  Receipts 
and  Expenditures  of  the  United  States  Government,"  adjusted  for  interest  accruals.  (See  "Bases  of 
Tables.")  This  trust  fund  was  established  in  accordance  with  the  provisions  of  Sec.  9U4(a)  of  the  Social 
Security  Act  of  August  14, 1935  (42  U.S.C.  1104).  For  further  details  see  annual  report  of  the  Secretary 
for  1041,  p.  1451 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUSIVE  OF  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30.  1960 

Fiscal  year  1961 

Cumulative 

through  .June 

30,  1961 

St-vte  Unemployment  Accounts 

Receipts: 

Deposits  by  States .         .    .. 

$28, 451, 759, 385.  20 

3,061.927,515.26 
6,  399, 314.  35 

$2, 398, 100,  366. 23 

195, 747,  569. 17 
651,  790. 67 

$30,849,859,741.43 

3. 257, 675, 084.  43 
7,051,105.02 

Interest  earned: 

Collected 

Accrued 

Total  receipts 

31, 520  086,  214  81 

2,  594. 499,  71G.  07 

34.114,585,930.88 

Expenditures: 

Withdrawals  by  States 

25,090,148,391.30 
7, 272, 336. 09 

107. 226, 931.  89 

3,  559, 562.  779.  77 
-1,488,830.05 

28,649.711.171.07 
5,783,506.04 

107, 226.  931. 89 

Advances  to  States  ' 

Transfers    to    railroad    unemployment 
insurance  account 

Total  expenditures 

25, 204,  647, 659. 28 

3,558,073,949.72 

28,762,721,609.00 

Transfers: 

From  undistributed  appropriations 

138, 024,  733. 38 
222,709,000.00 

138  024  733  38 

From  Federal  unemployment  account  '- 

From  Federal  extended  compensation 

account  (reimbursement) 

13,256,000.00 
6.104.101.00 

235,965,000.00 
6  104  101  00 

To  Federal  unemployment  account » 

-3,000.000.00 

—3, 000, 000. 00 

Net  transfers -  -- 

357, 733,  733.  38 

19, 360, 161. 00 

377, 093, 894. 38 

Balance 

6, 673, 172, 288.  91 

-944, 214, 072.  65 

6, 728, 958. 216. 26 

Railroad     Unemployment     Insurance 

Account  » 

benefit  payments  account 

Receipts: 

Deposits     by     Railroad     Retirement 
Board  «. 

1,404,964,867.61 

183,730,000.00 

106. 187, 199. 00 
107,  226,  931.  89 
15,000,000.00 

220. 707, 098.  44 
.3, 012.  40 

152,  708, 817. 99 
132, 345, 000. 00 

1, 557.  673, 675.  60 
316. 075, 000. 00 
106, 187, 199. 00 

Advances  from  the  railroad  retirement 
account 

From  the  railroad  unemployment  in- 
surance administration  fund 

From  State  unemployment  funds  ' 

107,226  931  89 

Advance  by  Secretary  of  the  Treasury.. 

15,000,000.00 
220  910  514  70 

Interest  earned: 

Collected 

203,  416.  26 
4,414.76 

Accrued 

7,  427  16 

Total  receipts 

2, 037, 819, 099. 34 

285,  261, 649. 01 

2,323,080,748.35 

Expendittires: 

Benefit  payments 

1, 921,  724,  577. 02 
12,338,198.54 
86,130,891.24 

15.000.000.00 

251,710,635.12 

2, 173, 43.1, 212. 14 
12, 338, 198. 64 

Transfers    to    railroad    unemployment 
insurance  administration  fund 

Repayment    of   advances    to    railroad 
retirement  account 

32, 225, 481.  76 

118,356,373.00 
16.000,000.00 

Repayment  of  advance  to  Secretary  of 
the  Treasury 

Total  expenditures 

2, 035, 193,  666.  80 

283,936.116.88 

2,319  129  783  68 

Balance 

2, 625,  432.  £4 

1,325,532.13 

3, 950, 964. 67 

ADMINISTRATIVE  EXPENSE  FUND* 

Receipts: 

Deposits     by     Railroad     Retirement 
Board 

16, 787, 932. 94 

7,237,031.36 

252, 388. 63 
4, 984.  38 

8, 599. 227.  59 

25, 387. 160. 53 
7,  237, 031. 36 

Adjustment  for  prior  year  (unexpended 
balance). 

Interest  earned: 

Collected 

154, 965.  97 
862.  60 

407, 354. 60 

Accrued 

5.  847. 04 

Total  receipts 

24,  282,  337.  31 

8,  755. 056.  22 

33, 037, 393.  53 

Footnotes  on  page  666. 


TABLES 
Table  85. —  Unemployment  trust  fund,  June  SO,  1961 — Continued 


665 


I.  RECEIPTS  AND  EXPENDITURES  (EXCLUSIVE  OK  INVESTMENT  TRANSAC- 
TIONS)—Continued 


Cumulative 

through  June 

30,  1960 

Fiscal  year  1961 

Cumulative 

through  Juno 

30,  1961 

ADMiNiSTEATivE  EXPENSE  FUND— Continued 
Expenditures: 

$18. 369, 845.  86 

$9,  738,  720.  68 

$28, 108,  566.  54 

Total  expenditures 

18, 369,  845.  86 

9, 738, 720. 6S 

28, 108,  566.  54 

Balance .      ..  .. 

5,  912,  491. 45 

-983, 664. 46 

4, 928,  826.  99 

TEMPORARY  EXTENDED  RAILROAD  UNEM- 
PLOYMENT INSURANCE  ACCOUNT 

Appropriation  account: 
Receipts: 

Advances  from  the  general  fund 

13,000,000.00 
13,000,000.00 

13, 000, 000. 00 

Less  transfer   to    temporary  ex- 
tended       benefit        payment 
account 

13,000,000.00 

Balance 

Benefit  payments  account: 
Receipts: 

Transfer  from  temporary  extended 
railroad  unemployment  insurance 
account 

13,000,000.00 
10,017,409.29 

13, 000, 000.  on 

Expenditures: 

Temporary       extended       railroad 
unemployment  benefits 

10, 017,  469  29 

Balance 

2,  982, 530. 71 

2, 982,  530.  71 

Federal    Extended    Compensation 
Account  ' 
Receipts: 

Advances  from  general  fund 

49S,  133, 622. 00 

498, 138, 622  00 

Expenditures: 

Temporary    extended    unemployment 
compensition  payments 

481, 151, 560. 00 
6, 104, 161. 00 

481, 151, 660. 00 

Reimbursement  to  State  accounts 

6, 104, 161. 00 

Repajnnent  of  advances  from  general 
fund — 

Total  expenditures 

487, 255,  721. 00 

487  255  721  00 

BaUince 

10, 882, 901.  00 

10, 882, 901. 00 

Employment  Security  Administration 
Account  ' 
Receipts: 

Transfers      (Federal     unemployment 
taxes): 
Appropriated 

345, 979, 586.  45 

301,500,000.00 

-250, 000, 000. 00 

1, 433, 635. 03 
29, 363. 65 

345,979,586  4."; 

Advances  from  general  (revolving 
fund) 

301,600,000  00 

fund 

—250,000,000  00 

Interest  earned: 

Collected . 

1,433,635  03 

Accrued 

29, 363.  65 

Total  receipts— 

398, 942, 585. 13 

398, 942,  585. 13 

Expenditures: 

Salaries  and  expenses,  Bureau  of  Em- 
ployment Security. 

7,738,718.31 

374,975,294.37 

5,100.863.15 
2, 245, 089. 61 

2,910,388.25 

7, 738, 718. 31 

Grants    to  States    for   unemployment 
compensation  and  employment  serv- 
ice administration 

374, 975, 294. 37 

Payments  to  general  fund: 

Reimbursement  for  administrative 
expenses 

5, 100,  863. 15 

Refund  of  taxes 

2, 245, 089.  61 

Interest  on  advances  from  general  (re- 
volving) fund 

2,910,388.25 

Total  expenditures 

392, 970, 353.  69 

392, 970, 353.  69 

Balance 

5,972,231.44 

5,972,231.44 

Footnotes  on  page  666- 


666   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  85. -^Unemployment  trust  fund,  June  SO,  1961 — Continued 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUSIVE  OF  INVESTMENT  TRANSAC- 
TIONS)—Continued 


Cumulative 

through  June 

30,  1960 

Fiscal  year  1961 

Cumulative 

through  June 

30,  1961 

Federal  Unemployment  Account 

Receipts: 

Interest  earned: 

$26,133,155.65 
216,  687.  03 

$6,948,253.11 
44,311.25 

$33, 081, 408.  76 

260,  998.  28 

Total  receipts     

26,  349, 842.  68 

6,  992,  564. 36 

33, 342, 407. 04 

Transfers: 

From  undistributed  appropriations 

204,  797, 667. 12 

3, 000,  000.  00 

-222,  709,  000.  00 

-6,070,407.87 

2, 553, 205. 05 

207, 350, 872. 17 
3,  000, 000.  00 

To  State  unemployment  accounts 

To  Bureau  of  Employment  Security, 
Department  of  Labor 

-13, 256,  000.  00 
«  -506.  86 

-235, 965,  000. 00 
-6, 070, 914.  73 

Net  transfers 

-20,981,740.75 

-10,703,301.81 

—31,  685, 042. 56 

6, 368, 101. 93 

-3,  710,  737. 45 

1,657,364.48 

Undistributed  Appropriations  h 

Receipts: 

Appropriations  from  general  fund - 

345, 375,  605. 55 

345, 375,  605.  55 

Transfers: 

To  Federal  unemployment  account 

-204,  797,  667. 12 
-138, 024,  733. 38 

-2, 553, 205. 05 

-207,350,872.17 
—138, 024,  733. 38 

-342, 822, 400.  50 

-2,  553, 205. 05 

—345, 375, 605.  55 

Balance  - 

2,  553, 205.  05 

-2, 553, 205.  05 

Summary  of  Balances 
State  unemployment  accounts 

6, 673, 172, 288. 91 

2, 625.  432.  54 
5,912,491.45 

-944,214,072.65 

1,325,532.13 
-983,  664. 46 

2,982,530.71 
10,882,901.00 

5,972,231.44 

6, 728, 958, 216. 26 

Railroad         unemployment         insurance 
accounts: 
Benefit  payments  account 

3, 950, 964. 67 

4, 928, 826. 99 

Temporary  extended   railroad   unemploy- 
ment insurance  account  (benefit  payments 

2, 982,  530.  71 

Federal  extended  compensation  account 

10,882,901.00 

Employment       security       administration 

5, 972, 231. 44 

Temporary   extended    railroad   unemploy- 

5,368,101.93 
2,  553,  205.  05 

-3,710,737.45 
-2,  553, 205.  05 

1,657,364.48 

Total  balances 

6,689,631,519.88 
7, 272, 336.  09 

-930, 298,  484. 33 
12,  830, 979.  54 

6,  759,  333. 035. 65 

Cash  advance  repayable  to  the  trust  fund- 

20,103,315.63 

6, 696, 903, 855.  97 

-917, 467,  504.  79 

5, 779, 436, 351. 18 

•  Amount  actually  withdrawTi  against  advances  (see  footnote  2). 

»  Advances  and  repayments  for  Alaska  as  authorized  bv  law  (42  U.S.C.  1321). 

»  Established  by  the  Railroad  Unemployment  Insurance  Act  of  1938  (45  U.S.C.  360,  361). 

•  Contributions  under  the  Railroad  Unemployment  Insurance  Act  of  1938,  as  amended  (45  U.S.C.  360(a)), 
In  excess  of  the  amount  specified  for  adminstrative  expenses. 

5  Amounts  equivalent  to  taxes  collected  from  employers  covered  by  sec.  13(d)  and  sec.  13(f)  of  the  Rail- 
road Unemployment  Insurance  Act  during  the  period  January  1936  to  June  1939,  inclusive. 

«  Maintained  in  the  trust  fund  pursuant  to  an  act  approved  September  6,  1958  (45  U.S.C.  361(a)),  pre- 
viously maintained  as  a  separate  account  in  the  Treasury. 

'  Established  by  the  Temporary  Extended  Unemployment  Compensation  Act  of  1961  (42  U.S.C.  1104). 

8  Established  by  the  Social  Security  Amendments  of  1960  (42  U.S.C.  1101). 

•  Unused  advances  returned. 

IK  This  account  reflects  amounts  appropriated  to  the  unemployment  trust  fund  representing  the  excess 
of  collections,  if  any,  from  Federal  unemployment  tax  over  employment  security  expenses  as  provided  by 
law  (42  U.S.C.  1101(a)). 


! 


TABLES  667 

Table  85. — Unemployment  trust  fund,  June  30,  1961 — Continued 
II.    ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT  (ACCRUAL  BASIS) 


June  30,  1960 


Fiscal  year  1961, 
increase,  or 
decrease  (— ) 


June  30,  1961 


Investments  in  public  debt  securities: 

Special  issues.  Treasury  certificates  of 
indebtedness,  unemployment  trust 
fund  series  matui'ing  June  30: 

314%  of  1961 

3%  of  1962 


$5, 580, 307, 000. 00 


-$5, 580, 307, 000. 00 
4,  624,  985, 000. 00 


$4, 624, 985, 000. 00 


Total  special  issues. 


5,580,307,000.00 


-955,322,000.00 


Public  issues: 

Treasmy  notes; 

4%  Series  A-1961 

3^%  Series  A-1962 

3M%  Series  C-1962 

25^%  Series  A-1963 

4%  Series  B-1963 

5%  Series  B-1964 

iH%  Series  A-1965 

Treasury  bonds; 

2)4,%  of  1959-62  (dated  Nov.  15, 

1945) 

2M%  of  1961... 

2}^%  of  1962-67. 

254%  Of  1963-68 

2J^%  of  1964-69  (dated  Apr.  15, 

1943) 

2}^%  of  1964-69  (dated  Sept.  15, 

1943) 

2^%  of  1965 

3%  of  1966 

23^%  of  1967-72  (dated  Oct.  20, 

1941) 

3^%  of  1967 

yA%  of  1968 

4%  of  1969 

3J^%  of  1974 

i%%  of  1975-85 

3Ji%  of  1978-83 

3V^%  of  1980 

Z]4%  of  1985 

3}^%  of  1990 

31^%  of  1998 

2M%  Investment  Series  B-1975- 

80 


Total  public  Issues. 


Total  investments,  par  value. 

Unamortized  discount 

Unamortized  premium 

Accrued  interest  purchased 


Total  investments 

Unexpended  balances: 

Trust  account 

Deposit  accounts,  railroad  unemploy- 
ment insurance: 

Benefits  and  refunds.. 

Administrative  expenses 

Temporary     extended     railroad     un- 
employment benefits 

Federal    extended    compensation    ac- 
count  

Employment  security   administration 
account 


Subtotal 

Accrued  interest  on  investments 

Cash  advances  repayable  to  the  trust  fund. 


Total  assets. 


10, 000, 000. 00 
5, 250, 000. 00 
15, 000, 000. 00 
10, 000, 000.  00 
10, 000, 000. 00 
10, 000, 000. 00 
10, 000, 000. 00 


4,000,000.00 
15, 000, 000. 00 
51,000,000.00 
56, 000, 000. 00 

29, 000, 000. 00 

7, 000, 000. 00 
10, 000, 000. 00 
10, 000, 000. 00 

7, 000, 000. 00 


15, 000, 000. 00 
5, 000, 000. 00 
5, 000, 000. 00 

50, 000, 000. 00 


7, 000, 000. 00 
3, 000, 000. 00 


745, 000, 000. 00 


1,089,250,000.00 


6, 669, 557, 000. 00 

-1,521,744.52 

479, 074. 31 


6, 668, 514, 329. 79 
12, 999, 416. 63 


855, 922. 98 
637, 852. 32 


6, 683, 007, 521.  72 
6, 623, 998. 16 
7, 272, 336. 09 


6, 696, 903, 855. 97 


-10,000.000.00 
-5,250,000.00 
-15,000,000.00 
-10,000,000.00 
-10,000,000.00 


-4,000,000.00 
-15,000,000.00 
-51,000,000.00 
-56, 000, 000. 00 

-29,000,000.00 

-7, 000, 000. 00 


14, 000, 000. 00 
2, 500, 000. 00 


3, 050, 000. 00 
53, 000, 000. 00 

5, 000, 000. 00 
86, 221, 000. 00 
54, 200, 000. 00 


5,721,000.00 


-949,601,000.00 

-2, 612,  778. 18 

-77, 787.  29 

300, 454. 04 


-951,991,111.43 
2, 176, 904. 16 

121, 364. 88 
-323, 720.  68 

2, 982, 530. 71 

10, 882, 901. 00 

5, 121, 904. 04 


-931,029,227.32 

730, 742. 99 

12, 830, 979. 54 


-917,467,504.79 


4, 624, 985, 000. 00 


10, 000, 000. 00 
10, 000, 000. 00 


10, 000, 000. 00 
10, 000, 000. 00 


7, 000, 
14, 000, 

2, 500, 
15, 000, 

5, 000, 

5, 000, 
53, 050, 
53, 000, 
12,000, 
89,221, 
54, 200, 


000. 
000. 
000.  00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000. 00 
000.  00 
000. 00 


745, 000, 000. 00 


1,094,971,000.00 


5,  719, 956, 000. 00 

-4, 134,  522. 70 

401, 287. 02 

300, 454. 04 


5, 716, 523, 218. 36 
15, 176, 320.  79 

977, 287. 86 
314, 131. 64 

2, 982, 530. 71 

10, 882, 901. 00 

5,121,904.04 


5,751,978,294.40 

7,354,741.15 

20,103,315.63 


5,779,436,351.18 


614359—62- 


■43 


668 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  86. —  U.S.  Government  life  insurance  fund,  June  30,  1961 

[This  trust  fund  operates  in  accordance  with  the  provisions  of  the  act  of  June  7, 1924,  as  amended  (38  U.S.C. 
755).  This  act  repealed  the  act  of  Sept.  2,  1914  (38  Stat.  712),  which  established  a  Bureau  of  War  Risk 
Insurance  in  the  Treasury  Department  and  repealed  the  amending  act  of  Oct.  6, 1917  (40  Stat.  398).  For 
further  details,  see  annual  report  of  the  Secretary  for  1941,  p.  142] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June  30, 

1960 

Fiscal  year  1961 

Cumulative 

through  June 

30, 1961 

Receipts: 

Premiums  and  other  receipts. 

$2, 004, 863, 410.  37 
1,  055,  209,  930.  68 

$19, 868,  287.  28 
37, 829, 919.  42 

$2, 024, 731, 697.  65 

Interest  and  profits  on  investments 

1,093,039,850.10 

Total  receipts 

3,060,073,341.05 
1,949,9.55,680.38 

57, 698, 206.  70 
93,757,337.98 

3,117,771,547.75 
2, 043, 713, 018.  36 

Expenditures: 

Benefit  payments,  dividends,  and  re- 
flindf   . 

Balance 

1, 110, 117, 660.  67 

-36, 059, 131.  28 

1, 074, 058, 529.  39 

II.  ASSETS  HELD  BY  THE  TREASURY 


Assets 

June  30,  1960 

Fiscal  year  1961, 
increase,  or 
decrease  (— ) 

June  30,  1961 

Investments  in  public  debt  securities: 

Special  issues,  U.S.  Government  life  in- 
surance fund  series  maturing  June  30: 
Treasury  certificates: 

334%  of  1961 

$660,000.00 

73, 100, 000. 00 
73, 100, 000. 00 

670, 000.  00 
73, 100, 000.  00 

670, 000.  00 
73, 100, 000.  00 

670, 000.  00 

670, 000.  00 

73,100,000.00 
73, 100, 000.  00 

670,  000.  00 
73, 100, 000.  00 

670,000.00 
73, 100, 000.  00 

670, 000.  00 
73, 100, 000.  00 

670.  000. 00 
73, 100, 000.  00 

670, 000. 00 
73, 100, 000. 00 

670,  000.  00 
73, 100, 000.  00 

670, 000.  00 
73, 100, 000.  00 

670. 000. 00 
73, 100, 000. 00 

670, 000.  00 
73, 770, 000. 00 

-$660,000.00 
-73,100,000.00 

Treasury  notes: 

V/.%  of  1961 

31^%  of  1962 --- 

$73, 100, 000. 00 

3M%  of  1962 

670.  000.  00 

3H%  of  196.3 _-- 

73, 100, 000.  00 

3%%  of  1963 --. 

670, 000. 00 

Zy>%  of  1964 

73, 100, 000. 00 

3M%  of  1964 

670, 000.  00 

334%  of  1965 - -.- 

670, 000. 00 

Treasury  bonds: 

35^%  of  1965            

73. 100, 000.  00 

3)^%  of  1966 

73, 100, 000.  00 

3%%  of  1966 

670, 000.  00 

3!^%  of  1967        

73, 100, 000.  00 

3%%  of  1967 

670, 000. 00 

3H%  of  1968 

73, 100, 000.  00 

3%%  of  1968    - 

670, 000.  00 

3H%  of  1969 

73, 100, 000.  00 

334%  of  1969 .- 

670, 000.  00 

Zy>%  of  1970 

73, 100, 000.  00 

3%%  of  1970— 

670, 000.  00 

35^%  of  1971 

73, 100, 000. 00 

3%%  of  1971 

670, 000.  00 

3K'%  of  1972 

73, 100, 000. 00 

3?4%  of  1972 

670, 000.  00 

ZV>%  of  1973 - 

73, 100, 000.  00 

3%%  of  1973      

670, 000.  00 

ZV>%  of  1974 

73, 100, 000.  00 

3%%  of  1974                    

670, 000. 00 

3%%  of  1975 

73, 770, 000. 00 

3H%ofl976 

38,653,000.00 

38,  653, 000. 00 

Total  investments 

1, 106,  540, 000.  00 
3,  577,  660.  67 

-35,107,000.00 
-952, 131.  28 

1,071,433,000.00 

Undisbursed  balance ..- -. 

2, 625,  529.  39 

Total.    -    -         .           -            

1,110,117,660.67 

-36,059,131.28 

1, 074, 058, 529.  39 

Note.— Policy  loaas  outstanding,  on  basis  of  information  furnished  by  the  Veterans'  Administration, 
amounted  to  $106,421,148.59  as  of  June  30,  1901. 


I 


TABLES 


671 


P 


Table  87. —  U.S.  Naval  Academy  general  gift  fund,  June  SO,  1961 

[This  trast  fund  was  established  in  accordance  with  the  act  of  Mar.  31, 1944  (10  U.S.C.  6973)] 

I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 


Cumulative 

through  June 

30, 1960 

Fiscal  year 
1961 

Cumulative 

through  June 

30, 1961 

Receipts: 

Donations . 

$162, 756.  55 
34,  362. 73 

$12,  639. 08 
2,  263.  00 

$175, 395.  63 
36  625  73 

Interest  on  investments 

Total  receipts.. ._._... 

197,119.28 
62,  702.  77 

14, 902.  08 
27, 422. 60 

212  021.36 

Expenditures 

90  125  37 

Balance _. 

134, 416.  51 

-12,520.52 

121, 895. 99 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 

June  30, 1960 

Fiscal  year  1961, 
decrease 

June  30,  1961 

Investments  in  public  debt  securities: 
PubUc  issues: 

Treasury  bonds: 

2i.i%  of  1965-70 

$85,000.00 
7,000.00 
11,  500. 00 

500. 00 
5, 000. 00 

$85, 000.  00 

3}4%  of  1990.... 

7  000  00 

3%  of  1995 

11, 500.  00 

U.S.  savings  bonds: 

Series  J  (2.76%) 

500  00 

Series  K  (2.76%) 

5,  000.  00 

Total  investments 

109,000.00 
25, 416.  51 

109, 000. 00 

Undisbursed  balance 

-$12,  520. 52 

12  895  99 

Total  assets . 

134, 416.  51 

-12,520.52 

121, 895.  99 

672    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  88. — Workmen's  Compensation  Act  within  the  District  of  Columbia,  relief 
and  rehabilitation,  J^me  SO,  1961 

[This  trust  fund  was  established  pursuant  to  the  provisions  of  the  act  of  May  17,  1928  (45  Stat.  600).     Foi 
fmther  details,  see  annual  report  of  the  Secretary  for  1941,  p.  141] 


I.  RECEIPTS  AND  EXPENDITURES  (EXCLUDING  INVESTMENT  TRANSACTIONS) 

Cumulative 

through  June 

30,  1960 

Fiscal  year 
1961 

Cumulative 

through  June 

30, 1961 

Receipts: 

Deposits 

$156, 275.  00 
46, 849. 91 

.$5, 025. 00 
4,  532. 96 

$161,  300.  00 

Interest  and  profits  on  investments .. 

51, 382.  87 

Total  receipts.. 

203, 124. 91 
74, 084.  21 

9,  557. 96 
5, 299.  68 

212,  682.  87 

Expenditures. ...           . 

79, 383. 89 

Balance  ..    .  _                  .... 

129, 040. 70 

4, 258.  28 

133,  298. 98 

II.  ASSETS  HELD  BY  THE  TREASURY  DEPARTMENT 


Assets 


June  30, 1960 


Fiscal  year 
1961,  increase, 
or  decrease  (— ) 


June  30, 1961 


Investments  in  public  debt  securities: 
Public  issues: 

Treasury  notes: 

4%%,  Series  A-1964 

5%,  Series  B-1964 

Treasury  bonds: 

2H%  of  1962-67 

2%%  Of  196.5 

2H%  Of  1965-71 

4%  of  1969 

3M%  of  1978-83 

3H%  of  1980 

3%  Of  1995 

2%%  Investment  Series  B-1975-80. 

U.S.  savings  bonds: 

Series  G  (2.50%) 

Series  K  (2.76%) 


Total  investments. 
Undisbursed  balance 


Total  assets. 


$12, 000.  00 
25, 000.  00 

5,  000.  00 
4,  000.  00 
10, 000. 00 
17,000.00 
4, 000.  00 


20,  000.  00 
6,  000.  00 


11,000.00 
11,500.00 


125,  500. 00 
3, 540.  70 


129, 040.  70 


-$5,  000. 00 


6,  000.  00 

's.'ooo.'oo' 


-6,000.00 


4,  258.  28 


4,  258.  28 


$12,  000. 00 
25,  000. 00 


4, 000. 00 
10, 000. 00 
23,  000.  00 

4, 000. 00 

5, 000.  00 
20, 000. 00 

6, 000. 00 

5, 000.  00 
11,500.00 


125,  500. 00 
7, 798. 98 


133,  298. 98 


TABLES 


673 


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674        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
Table  90. — Refugee  Relief  Act  of  1953,  loan  program  through  June  30,  1961 


Agency 

Loans 
made 

Repay- 
ments 

Balances 
due 

Estimated 
number  of 
persons 
receiving 
transpor- 
tation 
through 
loans 

Tol'^tny  ■Fniinrlatfor,  Tnr". 

$85,000.00 
25, 000. 00 

204, 000. 00 
70,000.00 

$60,000.00 

15, 000. 00 

204, 000. 00 

$25,000.00 
10,000.00 

2.055 
640 

4,025 

United  Lithuanian  Rehet  Fund  of  America,  Inc 

United  Ukrainian  American  Relief  Committee 

American  Fund  for  Czechoslovak  Refugees,  Inc 

70,000.00 

1,550 

Total 

384,000.00 

279,000.00 

105,000.00 

8,170 

Note.— Under  sec.  16  of  the  Refugee  Rehef  Act  of  1953,  approved  Aug.  7,  1953  (50  App.  U.S.C.  1971n), 
the  Secretary  of  the  Treasury  was  authorized  to  make  loans  not  to  exceed  $5,000,000  in  the  aggregate  to 
public  or  private  agencies  for  the  purpose  of  financing  inland  transportation  of  immigrants  from  ports  of 
entry  to  places  of  resettlement  in  the  United  States.  Although  no  immigrant  visas  were  authorized  to 
be  issued  under  this  act  after  Dec.  31,  1956  (50  App.  U.S.C.  1971q),  those  issued  through  tliat  date  were 
covered,  and  the  loan  program  continued  until  June  30,  19.57,  at  which  time  funds  available  for  makhig 
loans  expired. 


TABLES 


675 


Federal  Aid  to  States 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  {exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1950,  and  1961 

[Figures  on  basis  of  checks-issued,  see  also  "Note"] 


Appropriation  titles 


1930 


1940 


1950 


1961 


Tart  I.  Appropriations  From  Which  Pay- 
ments Are  Made  for  Grants  to  States 
AND  Local  Units 

department  of  agriculture 

State  experiment  stations,  Agricultural  Re- 
search Service  (7  U.  S.  C.  36l-427i) 

Payments  to  States,  Hawaii,  Alaska,  and 
Puerto  Rico.  Agricultural  Research  Admin- 
istration (7  U.  S.  C.  361-4271) - 

Cooperative  extension  work,  payments  and 
expenses,  Extension  Service  (7  U.  S  C.  301- 
308,  341-348,  343c,  343e.  343f,  343g). 

Cooperative  agricultural  extension  work  (7 
U.  S.  O.  301-308,  341-348,  343c-343e,  343f,  343g) . 

Payment  to  Minnesota  (Cook,  Lake,  and  Saint 
Louis  Counties)  from  the  national  forests 
fund  (16  U.  S.  C.  500) 

Payments  to  States  and  Territories  from  the 
national  forests  fund  (16  U.  S.  C.  500) 

Payments  to  school  funds,  Arizona  and  New 
Mexico  (16  U.  S.  C.  500) 

Forest  fire  cooperation  (16  U.  S.  C.  564-570) 

Forest  protection  and  utilization.  Forest  Serv- 
ice (16  U.  S.  C.  568e)-.. 

Assistance  to  States  for  tree  planting.  Forest 
Service  (16  U.  S,  C.  568e) 

Cooperative  farm  forestry  (16  U.  S.  C.  567- 568b). 

Cooperative  distribution  of  forest  planting 
stock  (16  U.  S.  C.  567) 

Payments  to  counties  from  submarginal  land 
program  (7  U.  S.  C.  1012)   

Payments  to  States,  Territories,  and  posses- 
sions, Agricultural  Marketing  Service  (7 
U.  S.  C.  1623) 

Research  and  Marketing  Act  of  1946  (7  U.  S.  C. 
1623) 

School  lunch  proeram.  Agricultural  Marketing 
Service  (42  U.  S.  C.  1751-1760). 

Coramoditv  Credit  Corporation  funds  (7  U.  S. 
C.  1421,  1431).... 

Removal  of  surplus  agricultural  commodities 
(7U.  S.  C.612C).-. 

Flood  prevention.  Soil  Conservation  Service  (5 
U.  S.  C.  574) 

Watershed  protection,  Soil  Conservation  Serv- 
ice (16  U.  S.  C.  590h  (b)) 


$4, 335, 000 


7, 539,  786 


5,  848, 149 


18, 458,  267 


1, 565, 032 


41,  243 
1, 383, 041 


1, 192, 370 


23,  555 
1,  987, 538 


139, 196 


90,332 


Total  Department  of  Agriculture 

DEPARTMENT  OF  COMMERCE 

Cooperative  construction  of  rural  post  roads 
(23  U.S.C.  205)  (see  also  items  of  similar  type 
under  class  II) 

Federal-aid  postwar  highways 

Federal-aid  highways  (23  U.  S.  C.  103) 

Federal-aid  secondary  or  feeder  roads 

Elimination  of  grade  crossings  (23  U.  S.  C.  130). 

Public-lands  highways  (23  U.  S.  C.  209) 

Forest  highways.  Bureau  of  Public  Roads 
(23  U.  S.  C.  204) 

Maritime  activities 

State  marine  schools  (46  U.  S.  C.  1335) ' 

Total  Department  of  Commerce. 


15. 003,  298 


28.600.211 


77, 887, 693 


150, 470 


105, 351, 358 

18, 355, 139 

29,521,720 

2, 128, 682 


50.000 


140,036 


77,  937,  693 


155,  647. 405 


DEPARTMENT  OF  DEFENSE 

Armj/ 
Payments  to  States,  Flood  Control  Act  (33 


U.S.  C.  701a,  701f-l). 


$7, 399,  422 


31,025,91  ! 


7,  753, 121 


60,775 
8, 768,  555 


708,112 

228, 447 
6, 183, 682 

81,  213,  235 
13,  697,  824 
60, 326, 135 


$32, 021, 495 
64, 968, 746 

123,275 

35, 408, 615 

139, 726 

11, 436, 136 

6,475 

391,987 

1, 195, 000 

151, 972, 399 
8 158, 663, 074 

195, 650, 404 
11,137,911 
21,311,107 


207,  365.  227 


684,  326, 350 


7, 023,  393 
400, 989,  712 


3,  477, 250 

10,155,389 

775, 395 


2, 590, 788, 486 


157, 761 


2, 761, 512 
29, 037, 366 

499, 120 


422,  578, 900 


2,  623, 086, 483 


467,  516 


Footnotes  at  end  of  table. 


676 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  (exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  19^0,  1950,  and  /^^i— Continued 


Appropriation  titles  • 


1930 


1940 


1950 


1961 


Part  I.  Appropriations  From  Which  Pay- 
ments Are  Made  kor  Grants  to  States 
AND  Local  Units— Continued 

department    of   health,    education,    and 

WELFARE 

Colleges  for  agriculture  and  the  mechanic  arts 
(7  U.S.  C.  321-343g) _. 

Further  endowment  of  colleges  of  agriculture 
andthemechanicarts(7U.S.C.  343-343g) 

Cooperative  vocational  education  in  agriculture 
(20  U.  S.  C.  11-30) 

Cooperative  vocational  education  in  trades  and 
industries  (20  U.  S.  C.  11-30) 

Cooperative  vocational  education,  teachers, 
etc.  (20  U.  S.  C.  11-30) 

Cooperative  vocational  education  in  home  eco- 
nomics (20  U.  S.  C.  11-30) 

Cooperative  vocational  education  in  distribu- 
tive occupations  (20  U.  S.  C.  11-30) ._. 

Cooperative  vocational  rehabilitation  of  per- 
sons disabled  in  industry  (29  U.S.  C.31-45b).- 

Promotion  and  further  development  of  voca- 
tional education  (20  U.  S.  C.  15h-15p:  29 
U.S.  C.  31-35) 

Promotion  of  vocational  education,  act  Feb. 
23,  1917,  Ofhce of  Education  (20  U.S.  C.  11-14). 

Expansion  of  teaching  in  education  of  the 
mentally  retarded  (20  U.  S.  C.  611-617)  s 

Grants  for  library  services.  Office  of  Education 
(20  U.S.C.  351) 

Defense  educational  activities.  Office  of  Educa- 
tion f20  U.S.C.  401-589)  >.. 

Land-grant  college  aid,  Office  of  Education 
(74  Stat.  414) 

Education  of  the  blind  (American  Printing 
House  for  the  Blind)  (20  U.  S.  C.  101,  1021.... 

White  House  conference  on  aging,  Office  of  the 
Secretary  (72  Stat.  1748,  September  2,  1958)... 

Mental  health  activities,  Public  Health  Service 
(42  U.  S.  C.  242b)  » 

Control  of  venereal  diseases.  Public  Health 
Service  (42  TT.  S.  C.  24,  25). 

Communicable  disease  activities.  Public 
Health  Service  (42  U.  S.  C.  246,  266) 

Control  of  tuberculosis,  Public  Health  Service 
(42  U.  S.  C.  246b) 

Operating  expenses.  National  Heart  Institute, 
Public  Health  Service  (42  U.  S.  C.  292)3 

Salaries,  expenses,  and  grants.  National  Heart 
Institute,  Public  Health  Service  (42  U.  S.  C. 
292) 

Operating  expenses,  National  Cancer  Institute, 
Public  Health  Service  (42  U.  S.  O.  285)3 

Salaries,  expenses,  and  grants,  National  Cancer 
Institute,  Public  Health  Service  (42  U.  S.  C. 
28.'i) ._ 

Environmental  health  activities,  Public  Health 
Service  (42  U.  S.   C.  241,  1857d).... 

Grants,  water  pollution  control.  Public  Health 
Service  (33  U.  S.  C.  466,  466d) 

Grants  and  special  studies.  Territory  of  Alaska 
(42  U.  S.  C.  246) 

Disease  and  sanitation  investigations  and  con- 
trol, Territory  of  Aliiska  (42  U.  S.  C.  267) 

Hospitals  and  medical  care,  Public  Health 
Service  (5  U.  S.  C.  150)  3.. 

Grants  for  construction  of  health  research 
facilities.  Public  Health  Service  (42  U.S.C. 
292c)  3 

Grants  for  construction,  mental  heslth  facili- 
ties, Alaska,  Public  Health  Service  (42 
U.  S.  C.274) 

Grants  for  waste  treatment  works  construction. 
Public  Health  Service  (42  U.S.C.  291d) 

Assistance  to  States,  general.  Public  Health 
Service  (42  U.  S.  C.  243-245)  « 

Grants  to  States  for  public  health  work,  Social 
Security  Act,  (42  U.  S.  C.  801-803) 

Grants  for  hospital  construction,  Public  Health 
Service  (42  U.  S.  C.  291a)  K 

Footnotes  at  end  of  table. 


$2,  550, 000 


3, 151,  340 

2, 956,  295 

1, 029, 078 

248, 057 


735,  619 


$2,  550, 000 

2, 480,  000 

« 19,  730 

♦  9, 787 

«  10, 000 

*  18,  431 

♦  10,  000 
2, 082, 198 

19,  384, 914 


$5, 030, 000 


$2,  550, 000 
2,  501,  500 


26, 489, 335 


115, 000 


125, 000 


4, 188, 399 


3, 293, 697 
12, 399, 314] 


6,  781,  262 
3, 095,  842 

6,  592,  932 


3,027J 


913, 

757, 117 


9,  500,  706 


14,081,127 
67, 073, 217 


32,  643,  768 

7, 153, 957 
509, 377 

7,  414,  221 
50, 189,  047 

2,  225, 000 
400, 000 
-9, 508 

5,913,981 

2,363,177 
3, 973, 585 
3, 296, 567 

3, 355,  518 

2,  633, 541 


« 1, 150, 842 

1,921,580 

2, 445, 809 
44,085,200 

16,  722,  664 
«  167, 246, 632 


TABLES  677 

Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  (exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1950,  and  iP^/— Continued 


Appropriation  titles  • 


1930 


1940 


1950 


1961 


Part  I.  Appropriations  From  Which  Pay- 
ment? Are  Made  for  Grants  to  States 
AND  Local  Units— Continued 

department  of  health,  education,  and 
WELFARE — continued 

Grants  to  States  for  maternal  and  child  welfare 
services  of  the  Social  Security  Act  (42  U.  S.  O. 
701-731) 

Grants  to  States  for  public  assistance,  Social 
Security  Administration  (42  U.  S.  C.  301-306, 
1201-1206)-. 

Grants  to  States  and  other  ag:encies.  Office  of 
Vocational  Rehahilitafion  (29  U.  S.  C.  4,  32) » 

Trainln?  and  traineeships,  Office  of  Vocational 
Rehabilitation  (29  U.  S.  C.  4,  32) » 


$9, 680.  706 
329, 303, 433 


$11,  234, 511 

1,134,960,863 
24, 741, 510 


$51,521,846 

2, 166, 986, 233 
54, 932, 040 


Total  Department  of  Health,  Education, 
and  Welfare 


$10,  746,  289 


379,217,408 


1, 307,  568,  754 


2, 624, 127, 177 


department  of  THE  INTERIOR 

Federal  aid  in  fish  restoration  and  management 
(16  U.  S.  C.  777b) 

Federal  aid,  wildlife  restoration  (16  U.  S.  O. 
669-1) - - 

Payments  to  counties  from  receipts  under  Mi- 
gratory Bird  Conservation  Act  (16  U.  S.  C. 
715e) 

Payments  to  States  from  receipts  under  Mineral 
Leasing  Act  m  U.  S.  C.  191) 

Payments  to  States  under  Grazing  Act,  public 
lands  (43  U.  S.  C.  3151) 

Payments  to  State?  under  Grazing  Act,  Indian 
ceded  lands  (43  U.  S.  C.  315j) 

Payments  to  States,  proceeds  of  sales  (receipt 
limitation)  (31  U.  S.  C.  711.  par.  17) 

Coos  Bav  wagon-road  grant  fund  (31  U.  S.  C. 
725e  (3)) 

Revested  Oregon  and  California  Railroad  and 
reconveyed  Coos  Bay  wagon-road  grant 
lands,  Oregon  (reimbursable)  (43  U.  S.  C. 
1181a,  b) 

Payment  to  certain  counties  in  Oregon  in  lieu 
of  taxes  on  Oregon  and  California  grant  lands 
(receipt  limitation)  (43  U,  S.  C.  8Gfla) 

Payment  to  counties,  Oregon  and  California 
grant  lands  (50%) 

Payment  to  counties  in  lieu  of  taxes  on  Oregon 
and  California  grant  lands,  25  per  centum 
fund  (25%)  (43  U.  S.  C.  1181f  (b)) 

Payment  of  proceeds  of  sales  of  Coos  Bay 
wagon-road  grant  lands  and  timber  (receipt 
limitation)  (43  U.  S.  C.  869a) 

Payment  to  Coos  and  Douglas  Counties,  Oreg., 
in  lieu  of  taxes  on  Coos  Bay  wagon-road  grant 
lands  (43  U.  S.  C.  1181  f,  g) 

Payments  due  counties,  submarginal  land  pro- 
gram, Farm  Tenant  Act,  Bureau  of  Land 
Management  (7  U.  S.  C.  1012) 

Payments  to  States  from  grazing  receipts,  etc., 
public  lands  outside  grazing  districts.  Bureau 
of  Land  Management  (43  U.  S.  C.  315m) 

Payments  to  Alaska,  coal  leases,  Bureau  of 
Land  Management  (43  U.S.C.  451) 

Payment  to  Alaska,  income  and  proceeds, 
Alaska  school  lands  (20  U.  S.  C.  238) 

Payment  to  Oklahoma  from  royalties,  oil  and 
gas.  south  half  of  Red  River  (receipt  limita- 
tion) (30  U.  S.  C.  233).... 

Payments  to  States  from  potash  deposits,  royal- 
ties and  rentals  (30  U.  S.  C.  149,  285,  286) 

Payment  to  Alaska  under  Alaska  Game  Law 
(48  U.  S.  C.  199.  Subdiv,  K) 

Payments  to  Alaska  from  Pribilof  Islands 
Fund,  Bureau  of  Commercial  Fisheries  (16 
U.  S.  C.631a-631q) 


451, 299 


1,387,838 


2, 151, 654 
603, 970 


18, 292 
43, 613 


602 


7,  577, 938 

88,419 
11, 328, 683 

185, 489 
5,518 


5,  376, 636 
15,  .148, 383 

486, 594 
34,  736, 941 

7  257, 131 
304, 344 


(«) 


1      979, 387 


142,041 


313, 845 


12,  771 
221 


1,  761, 766 


58,190 


72,  764 
102, 9G3 
209, 678 


41,  778 


11, 888 
11,000 


49, 256 
20,  281 


49, 286 


1,797 
1,050,002 


Footnotes  at  end  of  table. 


678 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  {exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1960,  and  1961 — Continued 


Appropriation  titles  i 


1930 


1940 


1950 


1961 


Part  I.  Appropriations  From  Which  Pay- 
ments Are  Made  fob  Grants  to  States 
AND  Local  Units— Continued 

DEPARTMENT  OF  THE  INTERIOR — COnttaUed 

Colorado  River  Dam  fund,  Boulder  Canyon 
Project,  payment  to  Arizona  and  Nevada 
(43  U.S.  C>i17a.  n - 

Boulder  City  Municipal  Fund,  Bureau  of 
Reclamation  (72  Stat.  1731) 

Operallon  and  maintenance,  Bureau  of  Recla- 
mation (43  U.  S.  C.  491,  498)... 

Disposal  of  Coulee  Dam  community,  Bureau 
of  Reclamation  (71  Stat.  524,  Aug.  30.  1957).. 

Construction  and  rehabilitation,  Bureau  of 
Redamation  (71  Stat.  419,  Aug.  26,  1957) 

Drainage  of  anthracite  mines.  Bureau  of  Mines 
(30  U.  S.  C  572) - 

Payments  to  the  State  of  Wyoming  in  lieu  of 
taxes  on  lands  in  Grand  Teton  National 
Park,  National  Park  Service  (16  U.  S.  C. 
406d-3) - - 

Administration  of  Territories,  Office  of  Terri- 
tories (43  U.  S.  C.  809-870) 

Trust  Territories  of  the  Pacific  Islands  (43 
U.  S.  C.  809-870. 

Virgin  Islands  public  works  (43  U.  S.  C.  86&- 
870) 

Internal  revenue  collections  for  Virgin  Islands, 
Office  of  Territories  (26  U.  S.  C.  7652  (b)  (1)).. 

Alaska  public  works.  Office  of  Territories  (43 
U.  S.  C.  869-870) 

Education  and  welfare  services.  Bureau  of 
Indian  Affairs  (25  U.  S.  C.  452)... 

Resources  management,  Bureau  of  Indian 
Affairs  (25  U.  S.  C.  461^83) 


$600,000 


$600, 000 

148, 637 

11,801 

15,000 

9,609 

191, 191 

29,280 
2, 486, 800 
S,  783, 600 


6, 494, 445 
774, 928 

5, 728, 726 
690, 035 


Total  Department  of  the  Interior 

DEPARTMENT  OF  LABOR 

Promotion  of  welfare  and  hvglene  of  maternity 
and  Infancy  (42  U.  S,  C.  161).. 

Grants  to  States  for  Unemployment  Compen- 
sation and  Employment  Service  Administra- 
tion, Bureau  of  Employment  Security  (29 
U.  S.  C.  49-49i) 

Grants  to  States  for  Unemplovment  Compen- 
sation Administration  (42  U.  S.  C.  501) 

Payment  to  States,  United  States  Employment 
Service  (29  U.  S.  C.  49^91) 

Total  Department  of  Labor 

DEPARTMENT  OF  STATE 

Center  for  cultural  and  technical  interchange 
between  East  and  West,  State  (22  U.  S.  C.1897) 

TREASURY  DEPARTMENT 

Internal  Revenue,  collections  for  Puerto  Rico 
(26  U.  S.  C.  7652  (a)  (3)) 

Federal  pavment  to  District  of  Columbia  (act 
July  5,  lO.'iS  f.9  Stat.  246) 

Federal  contribution  to  the  District  of  Colum- 
bia, Metropolitan  area  sanitary  sewage  works 
fund  (74  Stat.  510) 


$2, 470,  908 


$3, 654, 726 


21, 655, 190 


97, 392,  652 


«  9, 522 


3, 366, 606 


207, 617, 255 


358, 552, 447 


9,522 


3, 366, 606 


207,  617, 255 


358,  552, 447 


1,404,234 


24, 998, 476 
25, 000, 000 

2,  700, 000 


Total  Treasury  Department. 


52, 698, 476 


GENERAL  SERVICES  ADMINISTRATION 

Hospital  facilities  In  the  District  of  Columbia 
(60  Stat.  896,  Aug.  7,  1946) 


610, 404 


Footnotes  at  end  of  table* 


TABLES 


679 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  (^exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  19S0,  19^0,  1950,  and  1961 — Continued 


Appropriation  titles ' 

1930        1         1940 

1950 

1961 

Part  I.  Appropriations  From  Which  Pay- 
ments Are  Made  for  Grants  to  States 
AND  Local  Units— Continued 

HOUSING  AND  HOME  FINANCE  AGENCY 

Annual  contributions,  Public  Housing  Admin- 
istration (42  U.  S.  C.  1410) 

$5,  737,  706 

$140  243  564 

Urban  renewal  fund,  Office  of  Administrator 
(42  U.  S.  C.  1450)  .  .           

140,918  364 

Urban  planning  grants,  Office  of  Administrator 
(40  U  S  C.46I) 

3, 045, 194 

United   States   Housing  Authority  fund   (42 
U.  S.  C.  1404  (d),  1418) 

$1, 386, 132 

Total    Housing    and    Home    Finance 
Agency    -     

1,386,132 

5,  737,  706 

284, 207, 123 

INDEPENDENT  ESTABLISHMENTS 

Federal  Aviation  Agency 

Grants-in-aid  for  airports.  Federal  Airport  Act 
(49  U.  S.  C.  1103)          .--      .  -      

..  32,782,999 

581  843 

Grants-in-aid  for   airports  Oiquidatlon  cash) 
(49  U.  S.  0.  1103)                    -  - 

64, 215,  753 

Total  Federal  Aviation  Agency . 

32,782,999 

64  797  596 

Federal  Power  Commission 

Payments  to  States  under  Federal  Power  Act 
(16  U.  S.  C.  810)..- 

$12,  875 

19, 386 

28, 315 

54,  782 

Small  Business  Administration 

Grants  for  research  and  management  counseling 
(72  Stat.  698,  August  21,  1958) 

879  994 

Tennessee  Valley  Authority 

Tennessee  Valley  Authority  fund  (16  U.S.C. 
831J) -  - 

6, 478, 577 

Veterans'  Administration 

Annual  appropriations  under  title  "General 
operating    expenses.    Veterans'    Administra- 
tion": 
State  supervision  of  schools  and  training 
establishments  (38  U.  S.  0.  531-539) 

6,  909, 143 
4,354,348 

3, 273,  924 

1, 414, 440 

Administration    of    unemployment    and 
self-employment  allowances  (38  U.  S.  C. 
2011,  2012)... 

"Maintenance  and   operation  of  domiciliary 
facilities,"  and  "Inpatient  care": 
State  and   territorial  homes  for  disabled 
soldiers  and  sailors  (24  U.  8.  C.  134).... 

575, 206 

978,  767 

7,  569, 754 

Total  Veterans'  Administration 

575, 206 

978,  767 

14,  537,  415 

8, 984. 194 

Total  part  I 

106,  755,  791 

572, 870,  641 

2. 220, 339, 277 

6,  809, 092,  645 

Part  II.  Appropriations  From  Which  Pay- 
ments Are  Made  for  Selected  Programs 
Involving  Payments  to  Individuals,  etc., 
Within  the  States 

department  of  agriculture 

Conservation    reserve   program,    Commodity 
Stabilization  Service  (16  U.S.C.  590)       

>«  350, 547  651 

Cooperative  construction,  etc.,  of  roads  and 
trails,  national  forests  (16  U.  S.  C.  503) 

(») 
(") 

(») 
(") 

Federal  forest  road  construction  (23  U.S.C.  205).. 

Footnotes  at  end  of  table. 


680 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  (exclusive  oj 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1950,  and  1961 — Continued 


Appropriation  titles  > 


1930 


1940 


1950 


1961 


Part  II.  Appropriations  From  Which  Pay- 
ments Ark  Made  for  Selected  Programs 
iNVOLViNO  Payments  to  Individuals,  etc., 
Within  the  States— Continued 

department  of  aqricultuee — con. 


Forest  roads  and  trails  (23  U.S.C.  205) 

Forest  reserve  fund,  roads  and  trails  for  States 
(16  U.  S.  C.  501) 

Conservation  and  use  of  agricultural  land  re- 
sources (16  U.  S.  C.  .'.90g) 

Agricultural  Conservation  Program  (16  U.  S.  C. 
590e-l,  590e-2) ..- 

Administration  of  Sugar  Act  of  1937  (7  U.  S.  0. 
1100-1183) .- 

Grants  and  loans.  Farm  Housing  (42  U.  S,  C. 
1477) - 

Great  plains  conservation  program  (16  U.  S.  C. 
590p) - 


$7, 961, 032 


$11,478,686 
652, 042, 804 


$230, 764,  577 

59, 197, 418 
46, 321 


Total  Department  of  Agriculture.- 

department  of  commerce 

Forest  highways  construction  (23  U.S.C.  204). 

Maritime  activities 


7, 961, 032 


563,  521,  490 


289, 998,  316 


26, 916, 655 


State  marhie  schools  (46  U.S.C.  1335) »».. 
Total  Department  of  Commerce. . 
department  of  defense 
Army 


26. 916, 655 


National  Guard  (32  U.  S.  C.  106,  107) 

Maintenance  and  improvement  of  existing  river 

and  harbor  works  (33  U.  S.  C.  701c-3) 

Flood  control,  general  (33  U.  S.  C.  701c-3) 


31, 987, 927 


71, 019,  749 


87, 261, 167 


Total  Army. 


31, 987, 927 


71,019,749 


87, 870,  665 


Air  Force 
Air  National  Guard  (32  U.  S.  C.  101  (6))  - 
Total  Department  of  Defense 


44. 295,  643 


31, 987, 927 


71,019,749 


132, 166, 308 


department  of  health,  education, 
and  welfare 

Civilian  Conservation  Corps  (16  U.  8.  C.  684- 
584q) - 

Assistance  to  States,  general,  Public  Health 
Service  (42  U.  S.  C.  243-245)  '2 

Environmental  health  activities,  Public  Health 
Service  (42  U.S.C.  241,  1857d)   

Grants  for  construction  of  health  research  facil- 
ities, Public  Health  Service  (42  U.  S.  C.292c)" 

Grants  for  hospital  construction.  Public  Health 
Service  (42  U.  S.  C.  291a)  12 

Hospitals  and  medical  care.  Public  Health 
Service  (5  U.  8.  C.  150)  12 

Arthritis  and  metabolic  disease  activities.  Pub- 
lic Health  Service  (42  U.  S.  C.  289) 

Operating  expenses.  National  Cancer  Institute, 
Public  Health  Service  (42  U.  S.  C.  282f)  n... 

Salaries,  expenses,  and  grunts,  National  Cancer 
Institute,  Public  Health  Service  (42  U.  S.  C. 
282f) 

Operating  expenses,  National  Heart  Institute, 
Public  Health  Service  (42  U.  S.  C.  287d)'»... 

Salaries,  expenses,  and  grants.  National  Heart 
Institute,  Public  Health  Service  (42  U.  8.  C. 
287d) 


270, 856, 832 


5, 177, 886 


4,  909, 702 


$219,  705, 365 


69,728,315 


5, 642, 208 


645,  623,  539 


698,  874 


698,  874 


1'  415,  461,  084 


415,461,084 


i«  234,  540, 158 


650,001,242 


3, 374, 187 

650,  615 

20, 041. 138 

754, 657 

6, 099,  858 

40,  331. 197 

43,  366, 185 
51,063,662 


Footnotes  at  end  of  table. 


II 


TABLES 


681 


Table  91. — Expenditures  for  Federal  aid  to  States,  individuals,  etc.  (exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1950,  and  1961— Continned 


Appropriation  titles  • 

1930 

1940 

1950 

1961 

Part  II.  Appropriations  From  Which  Pay- 
ments Are  Made  for  Selected  Proorams 
Involvino  Payments  to  Individuals,  etc., 
Within  the  States— Continued 

department  of  health,  education, 
AND  welfare— continued 

Operating  expenses,  dental  health  activities. 
Public  Health  Service  (42  U.  S.  C.  288e) 

$231,  764 

$7  032  154 

Dental  health  activities,  Public  Health  Service 
(42  U.  S.  C.  288e)    

1 

Allergy  and   infectious  disease  activities   (42 
U.  8.  C.  289)  

27  918  951 

General  research  and  services.  National  Insti- 
tutes of  Health,  Public  Health  Service  (42 
U.  S.  C.  241) 

5,  726,  699 
3, 635, 866 

60,816,992 

Mental  health  activities,  Public  Health  Service 
(42  U  S   C  242b)  12 

53,  242,  590 
32,  509, 281 
34  442  434 

Neurology   and    blindness   activities,    Public 
Health  Service  (42  U.  S.  C.  246)     

Defense  educational  activities.  Office  of  Educa- 
tion (20  U.S.C   401-589)12. 

Expansion  of  teaching  in   education   of  the 
mentally  retarded,  Colleges  and  Universities 
(20  U  S  C  611-617)12 

304, 306 
3, 147,  812 

50, 349 

Cooperative  research,   salaries  and  expenses, 
Office  of  Education  (20  U  S  C  331-332) 

Consolidated  working  fund,  Health,  Education, 
and  Welfare,  Office  of  Education  (31  U.S.C. 
686) 

Preventine  the  spread  of  epidemic  diseases  (42 
use  243)15 

$273, 330 

71,117 

345,159 

Interstate  quarantine  service  (42  U.  S.  C.  243)i5 

Studies  in  rural  sanitation  (42  U.  S.  C.  243)  is. 

Training  and  traineeships,  Office  of  Vocational 
Rehabilitation  (29  U.  S.  C.  34)  12 

13,  523,  610 
-35,  510 

186, 180 

Grants  to  States  and  other  agencies.   Office  of 
Vocational  Rehabilitation  (29  U.S.C.  32)i2 

Cooperative  research  or  demonstration  projects 
in  Social  Security,  Office  of  The  Commis- 
sioner,  Social  Security  Administration   (42 
use  1310) 

Total  Department  of  Health,  Education, 
and  Welfare 

689, 606 

$270,  856, 832 

19,681,917 

388,  820, 648 

DEPARTMENT  OF  LABOR 

Reconversion  unemployment  benefits  for  sea- 
men (42  U.  S.  C.  1333) 

905,  964 

Unemployment    compensation    for    veterans, 
Bureau  of  Employment  Security  (38  U.  S.  C. 
2001) 

Unemployment  compensation  for  Federal  em- 
ployees,  Bureau   of  Employment  Security 
(42  U.  S.  C.  1366) 

>        173,  916,  200 

Unemployment  compensation  for  veterans  and 
Federal  employees,  Bureau  of  Employment 
Security  (72  Stat.  1082) 

Total  Department  of  Labor 

905, 964 

173, 916, 200 

GENERAL  SERVICES  ADMINISTRATION 

Construction  services,  Public  Buildings  Ad- 
ministration (40  U.  S.  C.  265) 

172, 178 

INDEPENDENT  ESTABLISHMENTS 

Atomic  Energy  Commission 
Operating  expenses  (42  U.  S.  C.  1804) 

i«  5, 951,  930 

Footnotes  at  end  of  table. 


682   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  91.- — Expenditures  for  Federal  aid  to  States,  individxials,  etc.  {exclusive  of 
emergency  appropriations  from  which  payments  are  made  to  or  within  States), 
fiscal  years  1930,  1940,  1950,  and  1961— Continued 


Appropriation  titles  ' 

1930 

1940 

1950 

1961 

Part  II.  Appropriations  From  Which  Pay- 
ments Are  Made  for  Selected  Programs 
Involving  Payments  to  Individuals,  etc., 
Within  the  States— Continued 

independent  establishments— continued 

National  Science  Foundation 

Salaries  and  expenses,  National  Science  Foun- 
dation (42  U.  S.  C.  1869) 

$122,  997,  503 
512, 810 

International     geophysical     year,     National 
Science  Foundation  (42  U.  S.  C.  1862) 

Total  National  Science  Foundation 

123.  510.  313 

Veterans'  Administration 

Veterans'    miscellaneous    benefits.    Veterans' 
Administration  (38  U.S.C.  Ch.  5011) 

1 

$2,815,021,445 
2, 169,  664 

254. 192, 654 

Readjustment  benefits.  Veterans'  Administra- 
tion (38  U.S.C.  1501-1510)     . 

( 

Automobiles  and  other  conveyances  for  dis- 
abled veterans  (38  U.S.C.  1901(a)) 

Total  Veterans'  Administration 

2,817,191,109 

254  192  654 

Total  part  II 

$40, 638.  565 

$905,398,071 

3,287,032,447 

2.242  715,401 

Grand  total 

147,394,356 

1,478,268,712 

5,607,371,724 

"9,051,808,046 

1  In  some  instances  appropriation  titles  have  been  changed  from  time  to  time  without  changes  in  the  basic 
laws. 

2  Consists  of  $71,878,027,  estimated  cost  of  food  commodities  acquired  through  price-support  operations  as 
ordered  for  distribution  within  States,  pursuant  to  se('.  416  of  Public  Law  439,  81st  Congress  (7  U.S.C.  1431), 
and  $86,685,047,  tasli  payments  to  States  to  increase  consumption  of  milk  by  children  in  school. 

3  Additional  payments  from  this  appropri;ition  are  included  in  part  II. 

*  Deduct:  represents  net  repayments.  The.se  accounts  were  discontinued  but  their  functions  are  con- 
tinued under  the  two  accounts  immediately  following. 

s  See  footnote  19  keyed  to  column  30  of  following  table. 

« Includes  — .$2,9S3  for  "Surveys  and  planning  for  hospital  construction." 

'  Consists  of  $252,246,  payments  to  States  from  grazing  receipts,  etc.,  puWic  lands  within  grazing  districts; 
$3,965,  payments  to  States  from  grazing  receipts,  etc.,  public  lands  within  grazing  districts  (miscellaneous); 
and  .$920,  payments  to  States  (grazing  fees). 

*  Special  fund  account  repealed  as  a  permanent  appropriation,  effective  July  1, 1935,  by  sec.  4  of  the  Perma- 
nent Appropriation  Itepeal  Act  (31  U.S.C.  725c).  Annual  appropriation  provided  for  same  object  under  the 
account  immediately  following. 

'  Activities  under  this  caption  expired  June  30,  1929. 

'"  Represents  payments  under  the  conservation  reserve  program. 

"  These  accounts  consolidated  with  combined  accounts  immediately  following. 

'2  Additional  payments  from  this  appropriation  are  included  in  part  I. 

"  Consists  of  .$361,738.  "Operation  and  maintenance.  Army";  $229,759,050,  "National  Guard  personnel. 
Army";  $165,406,158,  "Operation  and  maintenance.  Army  National  Guard";  $19,674,411,  "Military  con- 
struction. Army  National  Guard";  and  $199,727,  "Military  construction.  Army  Reserve."  On  obligation 
basis. 

"  Consists  of  $2,625,071,  "Military  construction,  Air  National  Guard";  $186,163,240,  "Operation  and 
maintenance.  Air  National  Guard";  and  $45,751,847,  "National  Guard  personnel.  Air  Force."  On  obliga- 
tion basis. 

'5  Formerly  shown  under  Treasury  Department. 

'8  Represents  costs  of  fellowship  and  assistance  programs. 

"  Payments  from  emergency  funds  to  or  within  States  included  in  the  following  table,  but  excluded  from 
this  table  for  the  fiscal  year  1901. 

Part  A— (see  columns  16, 17, 18,  23, 24,  35,  and  63  ($6,033,270)  of  the  following  table) $292,  770.  556 

Part  B— (see  columns  65  ($549,201)  and  92  of  the  following  table) 481,  700,  761 

Total 774,471,317 

Note.— Figures  furnished  by  the  departments  and  agencies  concerned  pursuant  to  Treasury  Depart- 
ment Circular  No.  1014,  Aug.  8,  1958  (see  exhibit  70,  p.  381,  in  the  1958  annual  report). 


TABLES 


683 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 

[On  basis  of  checks  issued  except  where  it  is  not  practicable  to  report  certain  detail  for  all  payments.  The 
differing  basis  of  such  detail  is  footnoted  and  a  checks-issued  figure  is  used  for  the  total.  The  differences 
in  amounts  between  the  two  bases  are  included  in  "Undistributed  to  States,  etc."] 

PART  A.     FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS 


State,  Territories,  etc. 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut— 

Delaware 

District  of  Columbia., 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois.- 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire. 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio.. 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc.' 
Undistributed  to 
States,  etc 


Total. 


Department  of  Agriculture 


Agricul- 
tural ex- 
periment 
stations  ' 

(1) 


215 
381 
713 
896, 
492 
367, 
270, 


467, 
924 
296, 
387 
849 
780 
823 
586, 
877 
623 
384 
454 
434 
809 
762, 
868, 
772, 
394 
527, 
264, 
294 
460 
348, 
915 

1,166, 
395 
954 
608, 
519 

1,057 
290 
691 
431 
891 

1, 181 
374 
288, 
780 
613 
603 
782 
331 
802, 


8  256, 999 


31, 521, 495 


Coopera- 
tive agri- 
cultural 
extension 
work  2 

(2) 


$1, 977,  736 
108, 929 
367, 896 
1, 658, 940 
1,386,711 
574, 902 
282, 714 
141, 294 


661, 931 

2, 120, 267 

254, 878 

412,  719 

1,677,175 

1, 407, 577 

1, 496,  728 

1,054,267 

2, 002, 352 

1, 299, 406 

378, 115 

523,  797 

402, 929 

1,561,431 

1,469,532 

2, 088, 495 

1,  809, 692 

459, 517 

899, 842 

183,  872 

194, 139 

397,  512 

444,846 

1,447,041 

2, 697, 600 

634,  389 

1, 919,  635 

1,409,488 

603, 646 

1,916,845 

102,  780 

1,470,215 

615,421 

2, 004, 226 

3, 265,  886 

342, 367 

249, 240 

1,  618, 162 

748, 126 

1,032,346 

1,453,547 

296,  811 

1,453,124 


'  8, 392, 710 


63, 373, 746 


School 
lunch  pro- 
gram 3 


(3) 


$4, 309 

129, 

1,233 

2,  529 

8,  676 

1,456 

1, 358 

242: 

252, 

4,  516 

5, 227, 

890 

723 

6, 037 

3, 888 

2,  765 
1, 800 
3, 989 
4, 994 

869 
2, 135 
3, 240 
5,584 
3, 264 

3,  526 
3,  563 

604 
1, 175 

168, 

486 
2, 868 

975 
9,864 
6,  585 

715 
7,041 
2,250 
1,  627 
7,541 

543 
3,  793 

655, 
4, 295, 
8,465 
1, 048, 

336, 
4,014 
2,260 
2, 256, 
3, 155, 

296, 

4,164 

85, 

51 

-2,  562, 


151, 972, 


399 


National 
forests 

fund  <— 
shared 

revenues 

(4) 


Submar- 
ginal  land 
pro- 
gram- 
shared 
revenues 
(5) 


$330, 276 
198, 131 
700, 356 
924,415 
5,  800, 895 
391,965 


269, 972 
163,  702 


1, 907, 148 

18,  529 

3,790 

214 


76, 885 

277, 855 

4,733 


202, 631 

288, 363 

727, 999 

48,  881 

1,291,824 

14, 992 

59, 665 

67,  710 


331, 402 


227,  575 

27 

9,289 

103, 808 

12, 629, 207 

147, 245 


417, 197 
100, 101 

30, 424 
636,  548 
189, 978 

37, 176 

69, 946 

6,488,711 

175,  792 

81,  772 

222, 612 

1,875 


35, 671, 616 


$2, 421 

548 

30, 323 


1,470 


2,173 


138 
10,  604 


3,106 
1,529' 


781 

"io^is 


11,649 

559 


194, 998 

625 

9,565 

4,151 


59,  874 


16, 698 
134 


30,095 
517 


391,987 


Coopera- 
tive proj- 
ects in 
market- 
ing « 

(6) 


$62 
18, 
11 
34 

149 
40 
11 
28, 


21 
5, 
57, 
116, 
80, 
111 
100 
100, 
93, 
68 
61 
249, 
70 
86, 
123 
26 
30 


67, 
43 
112, 

159, 
61 

56 

84, 
77, 

4o: 

4 

27 
24 
44 
43 
17 
21 
75, 
63 
42 
67 
11 


3, 290, 000 


State 
and  pri- 
vate for- 
estry co- 
opera- 
tion, etc.' 
(7) 


$352, 643 
26, 261 


310,678 

1, 175,  579 

52,  691 

66,  698 

18,259 


605,  887 
555, 252 

17, 660 
253, 174 
114,776 
130, 449 

40, 729 
5,219 
214, 164 
373,  597 
337,  702 
145, 668 
128, 939 
506, 261 
290, 077 
394, 161 
268,  502 
163, 141 

11,000 

46,401 
137,219 
128, 030 

56,  536 
305, 720 
396, 452 

22,  7,58 
145, 304 
159, 361 
546, 933 
255,  604 

46, 424 
340,  635 

46,  506 
299,  757 
318,519 

33,  525 
103, 658 
327, 979 
547, 665 
192, 381 
402, 061 

19,  716 
4.300 


11,442,611 


Footnotes  at  end  of  table. 


614359—62- 


-44 


684    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID   PAYMENTS  TO   STATES  AND   LOCAL   UNITS— Continued 


States,  Territories, 
etc. 


Alabama 

Alaska.. 

Arizona 

Arkansas 

California 

Colorado 

Connecticut. 

Delaware 

District  of  Columbia. 

Florida... 

Georgia 

Hawaii 

Idaho... 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri.. 

Montana 

Nebraska 

Nevada 

New  Hampshire. - 

New  Jersey 

New  Mexico 

New  York 

North  Carolina... 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee. 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories, 

etc' 

Undistributed  to 

States,  etc 


Total 32,449,018 


Department  of  Agriculture— Continued 


Water- 
shed pro- 
tection 
and  flood 
preven- 
tion 10 


(8) 


$386,  516 


72,  202 
340,  230 
2, 16!,  298 
646,  404 
294,  242 
103, 355 


129,  046 

1,  206,  387 

41,  736 

125,  390 

386,  480 

376,315 

1,  360, 207 

344,  858 

777,  431 

431, 666 


168, 153 

51,862 

87, 450 

258, 279 

1,  542, 000 

220,  434 

66, 013 

310, 754 

224, 238 

22,  813 

272,  780 

714, 094 

467,  437 

457,  655 

854,  894 

624, 340 

6, 790,  629 

142, 383 

329,  734 


114.  768 
277,  916 
834, 608 
,158,383 
155,  702 


257,  566 
255,  419 
977, 600 
337, 231 


390, 000 


Commodity  Credit 
Corporation 


Value  of 
commodi- 
ties do- 
nated " 

(9) 


$2,  357, 694 

41,817 

743, 170 

2,  718,  387 
1,  486,  453 

468, 040 
230,  492 
100, 742 
400, 085 
742, 232 
2,143.226 
188,  282 
56,  430 

1,  255.  587 
925,  832 
631,  298 
415,  299 

3,  735,  947 
3, 993, 070 

389,  892 
443,1.58 
529.  865 

3,  309.  736 
514. 177 

5.  843, 009 
1, 003, 330 
275.  478 
144, 382 
19, 936 
152.  372 
448, 1 55 
820,  ,544 

2,  818.  284 
1. 176,  6^6 

200,  596 

1,  474,  525 

2,  797,  912 
256,  865 

4,  428, 374 
104,  894 
505.  497 
395,  790 

2, 609,  269 

3,  661,  910 
275, 482 

98, 373 

1,115,005 

380,  408 

4,  338,  064 
586.  363 
108,  568 

7,  487,  8o4 
22, 810 

158,019 

348,  444 


Special 

school 

milk 

program  i 

(10) 


$1,  281, 733 

19,  276 

525,  980 

677,  566 

8,160,550 

822,  619 

1,182,215 

246,  637 

423, 961 

1,  377,  402 

1, 039,  319 

193, 136 

215,612 

5,  772,  916 

2, 075,  382 

1,727,903 

1, 003,  948 

1, 448,  212 

549, 067 

406,  968 

1,  727, 136 

2,  939, 057 
5,270,811 
2,  518,  427 

1,  409,  702 

2,  391, 440 
167,888 
525, 149 

87,  647 
284,  263 

2,  495,  297 
732,  835 

9,  224,  457 

1,  594,  531 
302, 153 

6, 236,  986 
911,114 
549,  809 

4, 027, 923 
361, 049 
621,414 
445, 940 

1,832,426 

2,919,818 
275,  617 
174,881 

1,  596,  600 

1,  463,  .386 
406, 036 

3, 206. 022 
155,  807 


1, 679, 024 


71,878,027     86,685,047 


Removal 
of  surplus 
agricul- 
tural 
commod- 
ities 


(11) 


$6, 119,  287 
120, 903 
1, 182,  699 
6  090.  513 
6, 001, 135 
1,535.282 
1, 055, 641 
426, 128 
1.115,988 

2,  640,  448 
5,  520.  842 

515,  520 
285,  538 

4,  343,  484 

3,  296,  802 
2,  704, 386 

1,  578, 954 
9, 099,  258 

5,  240,  761 
1,244,414 

2,  208,  310 
2,  603, 363 

10,  727,  710 

2,  522.  831 
5, 132,  096 
4,131,078 

750.  617 

631,  403 

110.475 

506,  631 

1,  747, 142 

1,  548,  894 

9,  281, 330 

4,  599,  648 
693, 540 

6,  272,  357 

5,  298,  734 
1.036,735 

17, 427, 147 
425, 805 

1,  783. 380 
987,  555 

5,  625,  344 

7,  254, 901 
1,140,220 

350,  361 

3,  316,  256 
1, 360,  353 

6,  693, 335 

2,  542,  847 
424, 181 

5, 038.  744 
31,  222 

39, 305 

21, 287, 971 


Department  of  Commerce 


Bureau  of  Public 
Roads— Coastruction 


Federal  aid 
highways 
(trust  fund) 

(12) 


$59.  508,  889 

9,911,868 

31,  556,  978 

30,  664.  909 
210,  678, 363 

29,  677,  099 
36,  282,  846 

6,  945,  851 
16,  987,  230 
73,  889,  647 
56,  789, 023 

4, 176. 173 

19,  537,  787 

168, 850,  719 

82, 936,  594 

39,  540,  997 
40, 029,  447 
42, 455,  457 
52,  532,  817 
16,123,488 
33, 195,  938 
43,  939,  222 

101,905,940 
65,457,192 
.39,840,311 
62, 085,  644 

28,  453,  463 

40,  473,  554 
11,909,418 
16,299,339 
48, 557, 194 
27,  625, 089 

158,  726,  660 
39,898,411 
24,037,180 

134,  831,  898 
36, 377, 956 
35, 687, 970 
86, 129,  464 
11,644,222 
38,  987,  423 

29,  917,  960 
69,  524,  247 

141,  905,  229 
24,  95J,  799 
16,  965,  812 
56,  435,  280 
33,  270, 338 

31,  628.  434 
42, 073, 867 
23,  840,  721 

4,  549, 781 


1,  579,  341 


15 195,650,404  2,590,788, 486 


Other  13 


(13) 


$259,  638 
2,  863,  718 
2,  377,  291 
703, 170 
3, 952,  694 
2,  408,  426 


State 
marine 
schools^ 


(14) 


14,  983 
41,941 


3, 052,  722 
41,776 
39,  962 


212,  430 
10, 260 
25,  541 


68,  817 

635.  878 

32, 216 

102, 909 

2, 478,  571 

205 

108,  980 

400,  220 


1, 001,  486 


102, 160 


22, 882 

16,  732 

4, 148, 989 

184, 360 


148, 497 
50, 419 
71,364 
29,  700 

1,  352,  955 

39,  650 
199,  049 

2,  346, 374 
139,  860 
128,  951 

1,  974,  217 


8,884 


31,798,877 


$120,  553 


126,  651 
121,' 906 


130, 010 


499, 120 


Footnotes  at  end  of  table. 


TABLES 


685 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Depart- 
ment of 
Defense, 
Army 


Lease  of 
flood 
control 

lands- 
shared 

revenues 

(15) 


Executive  Office  of 
the  President 


Office  of  Civil  and 
Defense  Mobilization 


Federal 
contribu- 
tions " 


(16) 


Research 
and  devel- 
opment 


(17) 


Funds  ap- 
propriated 

to  the 
President 


Federal 
Civil 
Defense- 
Disaster 
relief  "> 


(18) 


Department  of  Health, 
Education,  and  Welfare 


American 

Printing 

House 

for  the 

Blind 


(19) 


White 
House 
Confer- 
ence on 
Aging  18 


(20) 


Office  of 
Education 


Colleges 
for  agri- 
culture 
and 
mechanic 
arts  " 

(21) 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois — 

Indiana 

Iowa 

Kansas. 

Kentucky.-- 

Louisiana.- 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi-- 

Missouri 

Montana 

Nebraska 

Nevada - 

New  Hampshire.- 

New  Jersey- 

New  Mexico 

New  York.. 

North  Carolina.-- 

North  Dakota 

Ohio 

Oklahoma.- 

Oregon 

Pennsylvania 

Rhode  Island- 

South  Carolina. 

South  Dakota 

Tennessee- 

Texas 

Utah - - 

Vermont 

Virginia.-- 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico , 

Virgin  Islands 

Other  Territories,  etc.'. 

Undistributed  to  States, 

etc - 


$1, 903 


57, 677 
73, 238 

7,611 
569 

3,377 


9,825 
35, 629 


131 

38, 093 


27, 446 


59, 051 
23, 871 


213 

2,883 

1,620 

984 

108, 164 

73.  577 

22, 288 

42,997 


1,448 
977 


2,283 
3,169 

228,  972 
7,017 

239, 900 
2,968 
8,853 


3,638 
50, 026 
37, 422 
188, 606 


1,614 
15, 554 
5,085 
1,134 
17,  374 


$133, 

19, 
-2 
249, 
1, 114 
183 
162 

33, 

9 

336, 

278, 

76, 

37, 
270, 
190, 

98, 
146, 

56, 
526, 
126, 
340, 
148, 
295, 
197, 

63 
135 

39, 
174, 

29 

32 
222 

56, 

2, 995, 

197, 

67, 

1 

334, 

99 
708: 
101 
171 

22 
228, 
233, 

45, 

10 

80, 
1 

63, 
247, 

40, 
-4, 


$8.  393 

1,193 

60,  522 

7,750 

12,  450 

1,700 

750 

1,775 

2,386 

11, 480 

3,683 

36, 222 

75,  768 

12. 318 

28,  552 

4,762 

23,019 

1,750 

22, 217 

5,175 

5,909 

18, 938 

197, 293 

19, 925 

17,  757 

34,011 

2,626 

21, 058 

9,700 

1,368 

2,000 

8,395 

31,  580 

34, 089 

19, 021 

33,  675 

10,  280 

2,040 

16,  573 

1,030 

4,258 

2,748 

3,255 

125, 102 

954 

250 

3,950 

4,842 

20, 133 

79, 021 

3,488 

500 


$311,  694 
-377,914 


3,122,066 


1,088,550 
38, 898 


-54,652 
62, 406 
25, 083 


1,440 


25, 000 
350, 210 


219,  637 
-11,260 


1, 063, 556 


-204, 076 
532, 279 

-13,889 

942, 942 

26, 450 


175, 338 


-4,  721 


$7, 693 


3,583 

4,888 
36,440 

4,000 
10, 082 

1,305 

1,250 
11,387 

11,  360 
1,611 

778 
19, 858 
7,443 
4,305 
4,666 
4,888 
7,082 
944 
8,915 
18, 275 
18, 414 
8,027 
4,194 
7,499 
1,528 
2,416 
694 
1,028 
15,  748 
3,027 
40,  578 

12,  471 
833 

21,  636 
2,889 
5,833 

29,  496 
1,083 
4,083 
1,278 
7,999 

15, 470 
1,694 
417 
8,193 
7,638 
4,999 
7,166 
583 
2,305 


-$3,  699 


-273 
-112 
-1,504 


-301 


-787 


-2,842 


43, 283 


28 
-10,000 


$100,  541 
71, 283 
77, 477 
89, 048 
175,  599 
83, 218 
90. 023 
73, 173 


97,644 
104, 360 
2, 299, 986 
75, 872 
156, 905 
109, 245 
96, 146 
89, 006 
99, 375 
96,  769 
79, 115 
93, 372 
116,  789 
133, 559 
99,  751 
91,  735 
109,448 
75, 896 
83, 222 
71,  597 

75,  319 
118, 233 

76,  795 
217, 934 
110,  518 

76, 181 
149, 269 
92,278 
85, 176 
174,  720 
77, 899 
91, 118 
76,  511 
102, 835 
146, 921 
76, 872 
73,768 
103, 104 
93,  731 
90, 006 
104,  260 
72, 898 
50,000 


Total. 


1, 492, 156 


U,  478, 624 


1, 057, 638 


7, 318, 682 


400, 000 


-9,508 


7, 276,  500 


Footnotes  at  end  of  table. 


686   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continned 


States,  Territories,  etc. 


Department  of  Health,  Education,  and  Welfare— Continued 


Office  of  Education— Continued 


Coopera- 
tive voca- 
tional ed- 
ucation 1' 

(22) 


School 
construc- 
tion and 

survey 

(23) 


Mainte- 
nance and 
operation 
of  schools 

(24) 


Library 
services 


(25) 


Defense 
educa- 
tional 
activities  '6 

(26) 


Education 

of  the 
mentally 
retarded 

(27) 


Alabama 

Alaska 

Arizona— 

Arkansas 

California 

Colorado. 

Connecticut 

Delaware 

District  of  Columbia 

Florida - 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine - 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York ._. 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania -.. 

Rhode  Island 

South  Carolina-- 

South  Dakota 

Tennessee 

Texas - 

Utah -- 

Vermont 

Virginia 

Washinffton 

"West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virein  Islands - 

Other  Territories,  etc' 

Undistributed  to  States,  etc- 


060, 159 
105, 652 
206,  968 
781,  731 
220,  802 
352.  908 
361, 692 
179, 889 
33,  253 
686,  592 
127,  358 
178,  475 
234, 186 
677,  682 
970,816 
839,  274 
568,  505 
041,638 
914,  629 
231,864 
437,  682 
724,  413 
402,  973 
914,683 
908. 750 
120, 191 
208,  602 
442, 032 
181,991 
177,221 
843,  663 
230, 956 
558,  404 
428,296 
292,  424 
747, 073 
659,  456 
405,819 

186,  230 
158,  947 
748, 627 
297, 070 
126,  373 
966,  395 
192, 098 

187,  029 
017,822 
589, 355 
644,  330 
989,  756 
168,  334 
839,  621 

49,  292 
177, 743 


$553, 143 

1,  009,  446 

2,017,415 

1,089,905 

10,840,539 

557,  201 

880,  920 


$4,271,452 

6, 027,  885 

4,  467.  295 

941,  269 

38,  421,  578 

4, 109, 054 

2, 080, 633 

668,  679 


1,302,701 

1,  320, 037 

2,  844.  890 
246, 120 
923,  065 
664. 119 
105,  607 

1, 036.  504 

3,200 

228.  409 

429,  420 

4,133,343 

812,196 

1,  977,  564 

205, 198 

945, 015 

498,417 

1,358,726 

914, 137 

406,  353 

189,  228 

1,247,677 

3, 394,  298 

1,017,762 

894, 605 

743,  802 

1,089,004 

1,878,773 

370,019 

12,880 

169.  625 

708.  281 

833.  963 

192,  931 

3,  244,  827 
602, 041 


4, 120,  655 

543. 556 

13. 884 

198.110 

274,  987 


5, 158, 192 
4,  896,  258 
4,502,518 
1,434,199 

3,  236,  588 
1, 058,  263 

613,681 

4,  571,  963 
1, 128,  988 

752.  209 
1,912.536 
9,  675, 878 
6,  374, 190 
1, 5C6,  464 

404,  565 

1,  245, 0C6 

2,  528.  243 
1,503,335 
2, 172,  308 
1, 097,  453 
1, 178,  899 

3,  746,  5S3 
4, 835, 049 
6, 312,  333 
2,191,067 

459,215 

4,  745,  439 
6,  706,  965 

911,526 

5, 331,  567 

1,751,449 

3, 194,  900 

1,841,529 

2, 177,  207 

11,169,323 

1, 686,  799 

73,  482 

13,413,010 

8,497,218 

107,  701 

725, 151 

668, 243 


204, 139 


83, 131 

602, 140 

8,  468.  858 


$207,  576 
49, 191 
72,  485 
164,  544 
239, 322 
88, 084 
74,  755 
61,  585 


133,  235 
221, 848 

55, 087 

75,211 
230, 178 

60,  341 
173,  427 

75,  902 
221,  203 
158,010 

83, 021 
170, 000 

86,  000 
214.885 
165,  888 
191,, 340 
185.  931 

72,  427 
108,  519 

50,  395 

62, 087 
103, 153 

73, 042 
249, 152 
302, 331 
126,  436 
270,  635 
134,239 
127,216 
341,396 

59,  769 
196, 082 

82,  462 
219, 097 
285,  264 

63,  275 

63,  385 
211,253 
125,  287 
167, 674 
180.  736 

54,  209 
209, 077 

11,079 

15,  495 


$1,  734,  666 
97,  954 
1.54,  130 
756,  662 

3,  342,  852 
808, 259 

1, 046, 073 
181,  449 
187,  768 
740,  415 

2,471,263 
158,317 
405.  704 

2,  769.  566 
386,  668 
835,215 
826, 332 
975,  498 
662,  605 
297,  710 
868.  576 

1.  558,  276 

3,  574,  759 
1,  596,  484 

313,  244 
431, 166 
285,  494 
676,  477 
123,  824 
172,  333 

1, 633, 281 
497,  407 

3,  482, 012 

1, 970, 039 
51, 552 

3,501,571 

1,  249,  462 
225.  960 

2, 303, 340 
455,  595 
388, 162 
311,196 
858,  626 

1, 240, 862 
204,  964 
137,  399 

-211.605 
714,371 
469,  500 

1, 398,  358 

67. 358 

664, 466 

56  176 

79, 856 


$10.  200 
8,867 


6,500 
19,401 
17, 068 
11, 500 


16,  300 
12,200 
19, 350 
11, 667 
15,600 


13,400 
19,  700 

4,900 
15, 850 

5,100 


10, 600 
12.  700 
13, 135 


11,000 
12,  200 
5,700 
9,800 


7,350 
15,  468 

13,  750 

14,  800 
4,900 
8,169 


13, 567 
21,600 
20,800 


6,100 
15.  735 
18,  900 
10,600 


9,400 
13,400 
10, 200 
11,600 
10,400 


Total - 39,797,725    59,248,637    207,639,466 


7, 414, 221 


50, 189,  647 


509, 377 


Footnotes  at  end  of  table. 


TABLES 


687 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Department  of  Health,  Education,  and  Welfare— Continued 


Public  Health  Service 


Communi- 
cable 
disease 
activities 
(Includes 
venereal 
disease 
control)" 

(28) 


Tuber- 
culosis 
control 


(29) 


General 

health 

assistance 


(30) 


Mental 

health 

activities 


(31) 


Cancer 
control 


(32) 


Heart 
disease 
control 


(33) 


Environ- 
mental 
health 
activities 


(34) 


Alabama 

Alaska 

Arizona 

Arkansas—- -- 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana 

Iowa 

Kansas _- 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc.'.,. 

Undistributed  to  States, 

etc 


$43, 332 

7,250 

22, 322 

81,352 

59, 345 

7,581 

8.413 

12,038 

78,  693 

79, 814 

205, 080 


6,000 
178,  682 


9,382 
13,  518 
43,  723 
63, 924 


39,  094 


66, 307 
1,200 

36,  587 

63,851 
7,148 

12, 853 


34,  664 

29,  589 

396,  553 

120,  420 

11,837 

18,  387 

19,  497 
9,495 

124,  467 


97, 296 

8,015 

99,  503 

148, 191 


36,  709 
6,791 

14, 904 

-3.  807 

1,770 

26,  607 
4,816 


$93,155 
22,  663 

45,  051 
61,096 

287,  899 
33,165 
36,  797 
15,400 
36.  701 
94,  298 
85,  849 
21,360 
15,126 

210,  700 
79, 035 
36, 380 
32,  493 

102,  088 
78,  946 
22, 345 
83,  600 
98,  745 

151,697 

46,  532 
60, 362 
93,  880 
20, 134 
10,  534 
12,  646 
14, 238 

112,185 
32,  602 

390,  702 
86,153 
15,637 

177,  436 
50,  803 
34, 102 

247,  548 

21,871 

59, 072 

6,000 

103,  984 
181, 350 

6,969 

12,165 

93,  514 

51, 328 

54, 313 

60, 250 

10,953 

146.7.57 

8,380 

6,596 


$439, 999 

62,  773 
141,210 
268, 128 
1,  014, 869 
178,218 
142,  851 

30, 930 

55,  633 
466,  510 
454,  001 
191,220,195 
101,377 
687,  551 
327,  630 
263,  785 
228, 237 
403,  838 
343,917 
114,319 
245,  044 
373, 929 
619, 877 
320,  .503 
391,541 
387,211 

93, 885 
171,482 

50,  608 

52,000 

406,  971 

122,  724 

1,121,830 

585, 680 

94, 126 
761, 283 
260, 157 
185,429 
929, 333 

74,  467 
353.  764 
108,  549 
434, 694 
947,  838 
106, 200 

47, 055 
420,  784 
247,  898 
223, 249 
340, 918 

59, 298 

372,  978 

8,700 

7,530 


$117,  478 
38, 154 
37,  396 
66,  955 
397,  046 
51,733 
67, 670 

39,  600 
35,  580 

153,  400 

135,  368 

41,021 

41,021 

302, 209 

120, 161 

91,531 

68,  883 

112, 294 

109,  320 

40,  721 
93,117 

141,613 

243, 355 

105,  288 
89,  621 

134, 246 
41,021 
46, 990 
38,163 
39, 103 

175,158 
41, 021 

487, 294 

163,  570 
41, 021 

284, 092 
75,  414 
55,  235 

343, 200 
40, 948 
91,  784 
40, 317 

122,  000 

299, 341 
14,  509 
30, 830 

133,214 
87,  066 
59,  800 

118,  310 
28, 957 
85,  006 
39, 289 
16,  547 


$74, 875 

500 

18, 801 

47,  097 

223,  578 
34,  923 
30,  426 
20,000 

25,  445 
128,189 

82,  020 
18,000 

26,  022 
119,507 

80,  544 
26, 600 
45,  493 
71,611 
66,715 
19,  346 
51,002 
90,231 
129,182 
60,  548 
64, 113 

83,  711 
15,  800 
29, 879 

9,439 
14,  567 
98.  587 
26,  022 

273,  671 
96,  665 
26, 022 

165, 842 
50, 357 


210, 359 
26,  022 
57,  976 

9,300 
71,313 
173, 192 
17,  525 
20,  511 
75,  567 
51,545 
43,  403 
73, 452 

9,  437 
60, 062 

4,923 

5,601 


$86,  542 
7,553 


61,166 

174,217 
46,  766 
24,  567 
22,  680 
32, 362 
92,  629 
92,  830 
32,170 
35, 356 

119,159 
80,  269 
29,300 
50,  908 
82,  889 
71,070 
8,054 
61,312 
78,  775 

111,367 
62,  512 
79, 247 
80, 270 
19, 380 
13, 927 
10,  738 
17,562 
82, 278 
38,  561 

192, 995 

109, 804 
35, 997 

137, 182 
58,  472 
27,  423 

156,  746 
35,  673 
75,  946 
2,745 
86, 113 

161,700 
16,  966 
27, 818 
81, 054 
51, 773 
56,  739 
66,  907 
22,  046 
77,  513 
6,408 
2,131 


$57, 010 
13,  920 

23,  950 

39. 201 
137,  560 

28,  965 
42,873 
30, 296 

24,  886 
63,048 
60, 222 

26. 202 
19,  754 
95,  482 
66,631 
45, 137 
34, 902 
55,  679 
52, 199 

25,  485 
52, 097 
75,  740 
99, 281 

49,  845 

50,  554 
57.  521 
18, 935 
23,497 
10, 489 
24, 257 
80, 704 
21,187 

169, 801 
77, 070 

19,  856 
123, 091 

36,  809 

30, 501 

1.33, 978 

34,  831 

51,  687 

20,  470 
61,001 

107, 363 
22, 108 
19,  651 
60,285 
23, 520 
38, 322 
62, 127 
15, 250 
14, 375 
3,936 


Total 202,363,177  3,973,585  17,873,506 


5,913,981    2«  3, 355, 518 


3, 296, 567 


22  2, 633,  541 


Footnotes  at  end  of  table. 


688   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Polio  vac- 
cination 
assistance 
program  16 


(35) 


Department  of  Health,  Education,  and  Welfare— Continued 


Public  Health  Service— Continued 


Construction 


Hospital 

and 

medical 

facilities  23 

(36) 


Waste 

treatment 

works 


(37) 


Health 
research 
facilities 


(3S) 


Social  Security  Administration 


Grants  to  States  for  maternal 
and  child  welfare  services 


Maternal 

and  child 

health 

services 

(39) 


Services 

for 
crippled 
children 

(40) 


Child 
welfare 
services 

(41) 


Alabama. 
Alaska.. - 
Arizona.. 
Arkansas. 


California 

Colorado 

Connecticut 

Delaware  

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois.. 

Indiana 

Iowa 

Kansas.. 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michiean 

Minnesota. 

Mississippi 

Missouri. 

Montana.. 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington . 

West  Virginia 

Wisconsin 

Wyoming.. 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc' 

Undistributed  to  States, 
etc 


-2, 682 


-371 


-1,619 


$4,  575, 352 
21  2,  648, 169 

1,  563, 902 

3,  409.  550 
6,  829,  468 
1, 489,  743 

874, 962 

256,  265 

170.807 

3,991,932 

5,  756,  850 
1, 169,  281 

762, 178 
4, 673,  261 
2. 656,  679 
2. 420.  537 
2, 890,  085 

4,  620,  245 
3,762,011 

805,  953 

2,  609,  9t'5 

3,  215,  219 
3,714,329 
3,  205,  839 
4, 582.  996 
3, 984, 992 

699, 034 

2,  269, 109 
574,  697 
727.614 

2, 186. 417 
2, 036, 136 
7, 054, 969 
9. 304.  291 
771,  234 

6,  342,  438 
1,  783,  500 
1.  638.  789 
8, 556, 178 

809.  782 

3,  549,  556 
593, 084 

6,139,411 

7,  743,  643 

1,  276, 427 
615,298 

5, 193, 356 
1, 990,  888 

4,  374,  922 
3. 332,  668 

397,  473 

2,  985,  247 
104, 119 

10, 060 


$1,  238. 741 


559, 
947. 

2,  215, 
572, 
526, 
457, 
374, 
764, 
961, 
272, 
418, 

2, 105, 

1, 040, 
753, 
507, 
907, 

1, 048, 
203, 
600, 
682, 

1, 159, 
858. 
621, 
857, 
790, 
510, 
41.5, 
45' 
760, 
408, 

2,757 

1, 196, 
385. 

1,6' 

1. 034, 
697 

2,601 

73. 

790, 

418. 

1,310 

2,019. 
495, 
678, 

1, 196, 
646, 
911, 
886, 
147, 
168, 


$186, 019 


27, 424 


1, 121, 453 


235, 500 
238,  658 


82, 926 


24,600 


$568,  444 
142, 137 
166,  628 
304, 665 
941,713 
325, 649 
282,  749 
115, 131 
227, 473 
564,  575 
518,  Sl8 
157. 0.36 
159,  215 
480. 064 
363,  605 
257. 624 
213,  908 
378, 087 
379, 239 
150,118 
429, 268 
384, 899 
670, 292 
378, 234 
406. 246 
381, 308 
123,  225 
139,  798 
170,  320 

78,  957 
254,  691 
216.448 
842,  746 
710, 949 
121, 936 
689,  507 
253, 862 
185,  469 
795, 130 
178, 037 
378,  209 

63,  487 
543, 136 
787. 150 
108, 159 
120, 184 
515.871 
247, 673 
233, 819 
349,  706 
111,225 
376,  459 
102,412 

68,305 


$580,  904 
161, 636 


327,  943 
948, 920 
242, 987 
257,  008 
122, 128 
232,  234 
414,760 
610, 166 
172. 444 
132,  547 
616, 753 
432, 602 
419,  813 
286. 124 
462,  945 
472, 462 
142.519 
380,  638 
376,  589 
699.  584 
563, 154 
474. 106 
392, 308 
179, 748 

60, 215 
104, 042 
128, 399 
287, 186 
192,  780 
729.  888 
818,  790 
132,  454 
671.557 
303,  928 
220,  559 
855. 970 
168, 060 
469,  981 
133. 196 
599,  654 
1, 154,  362 
141.428 
118, 195 
538,  272 
271.. 341 
330. 357 
429,  970 
104. 306 
532,  491 
107,  894 

97, 646 


$345, 087 

63, 589 

135, 178 

231, 175 

646,  256 

156,702 

129, 092 

64, 283 

78,  896 

319,  911 

391, 084 

91,478 

88  376 

480, 184 

322. 759 

256, 262 

191,  272 

354, 346 

312,  770 

115,422 

212. 357 

220,  532 

481,  284 

284,  298 

310,  328 

297, 062 

100, 601 

148, 946 

61, 196 

84,  618 

283, 023 

121.  578 

696, 076 

524,185 

114,826 

537, 022 

212, 889 

164. 325 

661, 183 

93, 674 

308,  749 

111,4.36 

351.736 

715, 427 

121, 154 

75,  849 

365.  535 

202,  856 

246,  703 

298,  422 

69, 491 

316,313 

51. 392 

900 


Total. 


-5,761    159,692,441    44,085,200    1,921,580    18,113,755    19,795,003    13,613,088 


Footnotes  at  end  of  table. 


TABLES 


689 


Table  92. — Expenditures  made  by  the  Government  as  direct  -payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Department  of  Health,  Education,  and  Welfare— Continued 


Social  Security  Administration — Continued 


Grants  to  States  for  public  assistance 


Medical 

assistance 

for  the 


(42) 


Old-age 
assistance 


(48) 


Aid  to 

dependent 

children 


(44) 


Aid  to  per- 
manently 
and  totally 
disabled 

(45) 


Aid  to 
the  blind 


(46) 


Office  of 
Vocational 
Rehabili- 
tation 


(47) 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Mirmesota 

Mississippi 

Mlssomi 

Montana 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Peimsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc' 

Undistributed  to  States,  etc. 


$203,  595 


70,  626 
13,  513,  775 
3, 308, 956 


264,  347 


544,246 
1,  430, 190 


219, 180 
24,173 


$48,  028, 183 
730,  691 
7, 608,  575 
26,  923, 916 
145, 375,  793 
28,  286,  502 

7,  795, 210 
545, 769 

1, 602,  744 

35,  984, 214 

41,  648,  836 

678,  772 

4,  512, 482 
41,  925, 924 
13,  986,  880 
21, 298,  861 
17, 844,  520 
25, 911, 329 
75, 642,  618 

6,  803,  837 

4,  923,  696 
40, 069, 078 
33,  772,  803 
28, 105, 685 
26,  851, 363 
57, 171, 630 

3, 280,  749 

8,  535,  491 
1, 483,  390 
2, 935,  726 

10,  772,  553 
6,  983,  990 
48, 398,  366 
19,  793, 405 
4,  818,  092 
48,  780. 163 
57,  846,  585 

9,  800, 430 
26,  604, 134 

3, 679,  981 

12,  356,  743 
4,  695, 966 

22,  299, 251 
103, 131, 922 
4,  835, 336 
3,  523, 177 
7, 039,  365 

28, 142, 416 
7, 105, 339 

20, 085,  970 

1,  870, 236 

2, 181,  528 

140,  754 

14, 004 


$8,  861,  376 

1,  022, 129 
9, 230, 483 
4, 423,  280 

82,  892,  875 

8. 273. 203 
6, 672, 025 
1, 459, 873 

5,  588,  705 
14,  833,  781 
13. 405, 417 

2, 123,  596 

2,  479,  357 
42,  530,  579 
11,  018,  500 
10, 116,  504 

6,  870, 988 
17, 130,  805 
20, 429,  855 

5,  241,  848 
9,  997,  281 

14,  402,  263 
25,  574, 313 
10, 327,  203 

7,  865,  288 
21.  828, 639 

1,  926,  784 

2,  881,  854 
1, 112, 347 
1, 159, 910 

15,  915,  566 

8,  971,  789 
70,  517, 193 
21, 335,  536 

2, 089, 317 
29,  281,  996 
17,  970,  860 

6,226,513 
54,  807,  335 

4. 170,  099 
5,  602,  276 

3. 171,  624 
15,  709,  012 
14,  480,  571 

3,  783,  ,542 

1. 369. 204 
9, 100,  384 

11, 643,  571 

17, 970,  896 

9, 412,  808 

746,  691 

5, 152,  825 

145, 979 

42,638 


$4,  338,  928 


2,  860,  906 

6,  782,  698 

3,179,612 

1, 157,  730 

216,  010 

1,  422,  750 

5,  611,  598 

10, 731, 470 

475,  059 

671,  529 

10,  631, 752 


347, 184 
2, 418,  461 
3, 992,  056 
8,  879,  852 
1, 310,  329 

3,  375,  080 
6, 070, 429 
2,  703, 920 
1,  337,  021 

4,  357, 792 
8, 081,  094 

683,  709 
1, 109, 330 


274,  307 
3,  995, 314 

1,  547, 252 
20.  .531,  997 

9,  067, 963 

715, 484 

7, 063, 620 

5,  844, 904 

2,  742,  240 
8,  663,  889 
1,  514,  286 

3,  379,  258 
678,  268 

4,  356,  .542 
3,  553, 116 
1, 484, 025 

539, 995 

3, 625. 031 

3,  816, 207 

2, 920,  779 

2, 153,  559 

288, 142 

1,  276, 619 

30, 465 

7,777 


$610,  685 

56,  933 

508,  798 

1,  026, 358 

7,  210, 126 

165, 629 

150.314 

142, 170 

110,  ,588 

1, 335,  814 

1,721,642 

35, 105 

89, 109 

1,  684,  649 

1, 050, 064 

844,  987 

342, 091 

1,141,898 

1,  642,  810 

245,  969 

236, 188 

1,  230,  671 
919,  557 
588, 873 

2, 186,  576 

2,  283,  562 
181,  820 
433, 906 
106,  866 
139,  501 
528, 818 
209, 376 

2,  232, 458 

2,  458,  324 

59, 654 

1,932,074 

1,  060,  365 

129,  698 

3,  397. 125 

63, 269 

753, 711 

94.  506 

1, 188, 252 

3,  272, 046 

117,  243 

74,864 

675,  741 

392, 336 

396, 774 

526,  555 

31.917 

99,117 

4,625 

441 


$2, 167,  428 
113,  498 
513, 862 
1,  747,  960 
2, 935,  542 
690.  767 
419,  910 
176, 133 
248.  7,50 

1,  823,  606 

2,  731, 790 
365, 330 
187, 978 

2, 136, 414 
528,064 
978,  992 
709, 363 
638,  753 

1, 334,  815 
340, 348 
618, 179 

1, 105, 782 

1,  524,  586 
1, 140, 166 
1, 251, 383 

848, 432 
216,  878 
354, 396 
82, 151 
104,  561 
1, 062, 910 
230,556 

3,  769, 963 

2,  496,  642 
340,  581 

1, 365, 994 
1,  417,  548 

557. 351 

4,  367, 838 
325,  948 

1, 169, 256 

304. 192 

1,  640,  366 

1,  710, 030 

309,  999 

204. 352 
1, 334,  600 
1,  021,  982 
1,  353, 485 

985,  621 
95,  785 

736,  766 
32,422 
62, 036 


Total 19,579, 


1, 215, 164, 973 


701, 302,  286 


182,  817,  338 


48, 122,  548 


54, 932, 040 


Footnotes  at  end  of  table. 


690 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


Department  of  the  Interior 

Depart- 
ment of 
Labor 

States,   Territories,  etc. 

Federal 
aid  in  wild- 
hfe  resto- 
ration, and 
flsh  resto- 
ration and 
manage- 
ment 25 

(48) 

Migratory 
Bird  Con- 
servation 
Act  and 
Alaska 
game  law — 

shared 
revenues  =6 

(49) 

Payments 
from 
receipts 
under 
Mineral 
Leasing 
Act- 
shared 
revenues 

(50) 

Payments 
under 
certain 
special 
funds- 
shared 

revenues  2? 

(51) 

Bureau  of 

Indian 

Affairs  26 

(52) 

Unemploy- 
ment Com- 
pensation 

and 
Employ- 
ment 
Service 
Adminis- 
tration 
(trust  fund) 

(53) 

Alabama 

$294, 559 
404,  603 
445,  487 
243, 914 
894, 377 
283, 068 
123,  718 
123, 670 

$43 
3,259 

.$837 

2, 447,  593 

199, 842 

29, 539 

2, 707, 835 

3, 298, 421 

$476 

24, 478 

396, 586 

111 

130,  615 

54, 914 

$4,  490,  876 

Alaska                               .  -  .. 

$501,  252 
1,  632,  510 

1,417,140 

4, 146,  201 

15, 441 

672 

2,117 

3,  428, 596 

CalifoTiia 

41,899,311 

Colorado 

68,881 

3,  383.  255 
5, 698,  310 

Delaware 

31 

807,714 

District  of  Columbia    . 

2, 739, 978 

Florida 

316, 975 
384,  663 
124. 127 
574,611 

1, 023, 942 
512. 393 
608, 113 
191,680 
377, 303 
373, 525 
268, 036 
121,069 
151,  204 

1, 044, 636 
473, 049 
273, 176 
665, 585 
692,  834 
427,  396 
485, 086 
101,026 
162,  328 
520, 457 
746.  283 
514,168 
264.  444 
640, 887 
344, 201 
475,  479 
719,  396 

138. 858 
178, 499 
273, 755 
388, 001 
985, 864 
292, 577 

83. 567 
563,836 
456, 715 

197. 859 
699,  528 
243, 250 

22, 698 

2,771 
20,  221 

190 

2,171 

18,300 

6, 547, 963 

4,  594.  782 

1,135,384 

Idaho  

2,360 
5,935 

284,  307 

45, 975 

107, 472 

2, 126, 438 

Illinois         .  .     .-  -      

15,  759, 464 

5,  920, 948 

Iowa 

1,327 

449 

13, 931 

273,  653 

19, 366 
8,800 

3,  297,  758 

Kansas 

135,  524 

13 

2,  651,  230 

3, 801, 100 

Louisiana 

88, 575 

206 

4,  495.  331 

Maine 

1, 743, 196 

248 

233 

4, 935 

2,180 

8,192 

947 

12,072 

30,  693 

4,362 

6, 137, 421 

Massachusetts 

12, 947, 971 

Michigan    

936 

43 

1,450 

181 

6 

141,048 

12 

386,580 

15, 857, 836 

Minnesota 

326,460 

4, 813, 423 

Mississippi 

2,422 

3,  600, 103 

Missouri.  ..  .  .  .                .  . 

6, 291, 015 

Montana 

1, 621.  704 

6,257 

136, 262 

180, 941 
120,000 
125,085 

1,  748, 856 

Nebraska 

1,559.727 

Nevada     .. .  . 

1,466,279 

New  Hampshire. 

1,321,013 

New  Jersey 

13,468,413 

New  Mexico    ..        ..        

818 
1,853 

536 
5,983 

8,099,027 

55,832 

1, 333, 531 

2, 161. 339 

New  York 

53,169,064 

North  Carolina 

18, 300 
253, 349 

5,571,579 

North  Dakota  .  . 

84, 685 

1,723 

1,  218, 765 

Ohio 

15, 778, 592 

Oklahoma    ..  .  . 

13, 024 

38, 704 

5 

38,  936 
51,698 

11,823 
16,406,668 

547, 366 
100, 491 

5, 258,  644 

3, 883, 493 

Pennsylvania 

26, 746, 551 

Rhode  Island    .. 

3,315,042 

South  Carolina 

66 
3,172 

186 

6,477 

37 

297 

367 

7,795 

3, 369, 107 

South  Dakota 

67,002 

10, 303 

504, 486 

915,612 

Tennessee  .   

4, 263, 432 

Texas... 

4,467 
36,719 

13, 575,  577 

Utah          

2, 783, 198 

89,440 

3, 095, 749 

Vermont 

982, 476 

Virginia 

3, 429, 738 

Washington        

583 

30,440 

102, 420 

6, 719, 137 

West  Virginia 

2, 627,  663 

Wisconsin  .      ..    .. 

2,829 
168 

296 
120, 293 

300, 164 
60, 147 

5,114,728 

Wyoming 

12, 651, 566 

929, 870 

Puerto  Rico        .    . 

1,847,190 

Virgin  Islands 

111,861 

Other  Territories,  etc' 

8,543 

12, 158 

Undistributed  to  States,  etc. 

2»  5, 158, 050 

Total  

20, 925, 019 

488,391 

34,736,941 

17, 869, 428 

6,418,761 

358, 552, 447 

Footnotes  at  end  of  table. 


TABLES  691 

Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Federal 
Aviation 
Agency 


Federal 

airport 

program  s" 


(54) 


Federal 
Power 
Commis- 
sion 


Payments 
to  States 
under 
Federal 
Power 
Act- 
shared 
revenues 


(55) 


Housing  and  Home  Finance  Agency 


Office  of  Administrator 


Urban 
renewal 
program 


(56) 


Urban 
planning 
assistance 


(57) 


Public 
Housing 
Adminis- 
tration 


Annual 
contribu- 
tions 


(58) 


Small 
Business 
Adminis- 
tration 


Grants  for 
research 

and 
manage- 
ment 
counseling 

(59) 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia 

Hawaii 

Idaho. 

Illinois 

Indiana 

Iowa 

Kansas- 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire.- 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington -- 

West  Virginia 

Wisconsin 

Wyoming- 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc.^- 

Undistributed  to  States,  etc. 

Total -.. 


$662, 

2,  933 

1,475, 

551, 

7,  264 

982, 

672 

106 


2, 077, 
697 
532 
149, 

3, 282, 
404, 
411 
159, 

1,105 

2, 242, 
317 
533, 

1, 437, 

1, 909, 
966, 
583, 

1,161 
260, 

1,397 
621 
209, 
553, 
310 

3, 045, 
791 
80 

4, 362, 

4, 189 
765, 

4, 248, 

272, 

279, 

79, 

2.016 

2,  670, 

1,140, 
33, 

1,115, 
897, 
131 

1,018 
414 

1,268, 


$435 

421 

11 

27, 640 

552 


$1, 242,  885 
471, 380 


$45, 289 
22, 380 


348,  428 
6, 323,  289 

323, 188 
11,260.576 

961, 432 
1, 398,  738 


36,423 
222,  766 
108, 311 

75, 801 


3, 932,  608 
1,  705, 511 


14,  535,  656 
1,771,391 
1,172,163 
1,  640, 190 
1,  486, 909 


139 
11 
24 


462,  493 
1, 179,  567 
4, 074,  562 
6,741,063 
4, 826,  806 


10, 907 


6,  692,  450 


92, 196 
61, 474 
82, 035 

6,600 
125, 283 

7,186 
31,720 
49, 970 
49,  543 
84, 166 
80,  467 
52, 989 
130,  682 
11,210 
99, 072 

7,898 


$5,  842, 905 

217,540 

359, 928 

686,  223 

5,  689, 603 

1,051,751 

2, 510, 285 

499, 257 

2,  718, 324 

2,  668, 926 

7, 428,  403 

456, 203 

31, 933 

9,  535,  953 

899, 927 


403, 977 

718, 160 

5, 273, 931 


31 


10,  818,  551 


4,487 
8 


566, 653 

10, 025, 441 

8,507 

2, 096,  561 

20, 606,  565 

1,269,126 

160, 445 


10,  381 
18,  573 
1,710 
8,184 
246, 388 
72, 984 
65,428 
33,  709 


127, 239 
122. 980 

63,  391 
239, 278 

21,992 


2, 897,  230 

3,  596,  560 

45,  749 

3,  579, 401 

5,  805,  823 

3,  059,  739 

1, 322, 121 

1,342,986 

3,691,124 

121,  781 

456, 969 

108, 000 

348,  636 

10, 068, 294 

52,  823 

20. 983, 862 

2,953,512 

11,018 

3, 446, 249 


120,  890 
8, 952. 154 
1,333,785 
1,418,385 


1,906 


9, 151,  852 
405, 416 


155,  792 
133,  266 


5,148,318 
7, 483, 176 


16 
1,865 
3 
99 
106 
13 


4, 133,  283 
430,  720 


1,031,757 


32, 357 
73. 080 
74, 577 
17,  614 
32,  770 
3,290 


3, 938, 431 
782,  604 
510, 804 
676,  528 


5, 116, 249 
273, 206 


6,750 


64, 797,  596 


54,782 


140, 918, 364 


3, 045, 194 


140, 243, 564 


$21,310 


36,000 
42,500 
6,375 
16, 000 
30, 000 
26,  567 


10,000 


12,115 
21, 230 


30, 983 
17, 415 
23,  500 
13,  596 
16, 000 


8,740 
43, 000 
15,  000 
59,  700 
20,  500 
30,000 

6,300 


18,  500 
6,000 
5,477 
8,900 
15, 825 
18,500 
14, 000 
18,000 
15,  532 
11, 000 
15,000 
18,  630 
10,000 
25, 000 
21,300 
14,  000 
22,500 
18,000 
19,000 
16,000 
26,000 


36,000 


879, 994 


Footnotes  at  end  of  table. 


692 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  92. — Expenditures  made  by  the  Government  as  direct  pa^jments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961 — Continued 

PART  A.    FEDERAL  AID  PAYMENTS  TO  STATES  AND  LOCAL  UNITS— Continued 


States,  Territories,  etc. 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida 

Georgia .-- 

Hawaii—- 

Idaho 

Illinois --- 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi - - 

Missouri.. 

Montana 

Nebraska 

Nevada.. 

New  Hampshire 

New  Jersey... 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio -. 

Oklahoma 

Oregon 

Pennsylvania 

Rhode"  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

V/yoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc' 

Undistributed  to  States,  etc. 

TotaL.. 


Tennessee 

Valley 
Authority 


Shared 
revenues  3i 


(60) 


$1, 353, 096 


63,912 


761,  501 


235,  279 


3, 926, 600 
24,"  272' 


6, 478,  577 


Veterans'  Administration 


State  and 
territorial 
homes  for 

disabled 
soldiers  and 

sailors  '^ 

(61) 


$1, 603,  232 

56,  680 

670,  708 


101,  574 


39, 788 
659, 255 
163,  931 
211,441 

42,707 


679,  266 
613,  319 
240, 495 


57,  641 
44,361 
110, 954 


30,  524 
164,  846 


2,786 


64,594 
429, 179 
457, 460 


160, 357 
220, 636 


111,200 


36, 189 
"396,"  lis' 


188,  997 
11,516 


7,  569,  754 


State  super- 
vision of 

schools  and 
training 
establish- 
ments 33 

(62) 


$59,  540 


9,581 

24, 397 

133,  899 

42,802 

12,  284 


4,441 
45, 208 
34, 371 


112,461 
30, 371 
23, 298 


33, 254 
73, 772 


1,673 
30, 916 
21, 339 
104,  808 
13,616 
40,346 

6,803 
29, 327 


8,376 
665 


2,436 
69,401 


59,  975 
45, 184 


63,  892 
11,065 
31,083 


47,  577 
72,811 


2,569 
23,948 
10, 280 
45, 734 
25, 420 


5,517 


1,  414,  440 


Miscella- 
neous grants 


(63) 


3<  $7,  868,  200 


35  9, 609 


38  28, 310,  404 
'"3'7"i,"464,"234 


35  148,  637 


191, 191 


«i  24, 998,  476 
42  6,  494, 445 
"  8, 270, 300 


77,  700,  495 


Total  grant 
payments 
(Part  A) 


(64) 


$172 

136, 

42 

440, 

75 

451, 

100 

058, 

632 

975, 

98 

137, 

85 

509, 

14 

973, 

64 

960, 

175 

539, 

183 

235, 

30 

197, 

42 

732, 

352 

795, 

141 

263, 

98 

056, 

92 

0,59, 

135 

7.50, 

199 

767, 

42 

081, 

92 

492, 

171 

728, 

244 

880, 

142 

295, 

121 

211, 

197, 

655, 

51 

994, 

70 

534, 

23 

293, 

29 

762, 

132 

365, 

77, 

687, 

460 

744, 

146, 

312, 

42 

.547, 

305, 

086, 

168, 

499, 

106 

793, 

310, 

948, 

34, 

255, 

89, 

403. 

49, 

968, 

173 

265, 

360 

698, 

53 

353, 

27 

881, 

132 

409, 

119, 

774, 

91, 

391, 

107. 

074, 

47, 

,524, 

74. 

655, 

8, 

039, 

10, 

Oil, 

45, 

196, 

029 
004 
558 
541 
088 
476 
791 
455 
007 
220 
178 
535 
840 
907 
643 
643 
833 
195 
627 
063 
685 
900 
254 
623 
270 
687 
734 
772 
842 
725 
965 
770 
964 
282 
727 
316 
832 
222 
902 
985 
759 
779 
168 
120 
099 
386 
691 
687 
716 
544 
187 
128 
747 
420 
674 


7, 101, 863, 200 


Footnotes  at  end  of  table. 


TABLES 


693 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided  re- 
lief and  other  aid,  fiscal  year  1961 — Continued 

PART  B.    FEDERAL  AID  PAYMENTS  TO  INDIVIDUALS,  ETC.,  WITHIN  THE  STATES 


States,  Territories, 
etc. 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Colum- 
bia  

Florida 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire-.. 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota..  ... 

Ohio 

Oklahoma. 

Oregon.. 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia.. 

Washington 

West  Virginia. 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories, 

etc' 

Undistributed  to 
States,  etc.. 


Department  of  Agriculture 


Agricultural 
conserva- 
tion 
program  *< 


(65) 


243, 412 
68, 245 
861, 010 
619,  542 
906, 239 
343, 678 
447, 887 
311,758 


917,  772 
889, 758 
151, 995 
921, 053 
092, 307 
338, 582 
269, 410 
261, 227 
349, 381 

881. 884 
993, 622 

308. 885 
612, 038 
827, 588 
828, 684 
525,  567 
356, 848 
977, 001 
018, 967 

343. 918 
578, 861 
743,  701 
704, 274 
081,  573 
642, 802 
802, 678 
613, 956 
904, 211 
427, 225 
316,  579 

82,  588 
169, 801 
580,023 
949, 840 
217,  769 
247, 188 
248, 244 
124,  740 
585, 041 
763, 065 
744, 963 
152, 267 

904. 919 


Adminis- 
tration of 
Sugar  Act 
program 


(66) 


f8, 598,  584 
6, 979, 389 


1, 362, 785 


8, 778, 422 

4, 288, 498 

67,  735 


39, 184 
350,  347 


6, 802,  530 


2, 127, 344 
2, 376, 834 


2, 106,  691 

3, 158,  689 

20,  709 


19, 096 


1, 337, 183 
718, 670 


1, 112, 491 


184, 617 


70, 377 
1, 302, 726 


1, 849, 476 


139, 098 
1,  626, 168 
14, 310, 672 


Great 
Plains 
conser- 
vation 
program 


(67) 


$502,  542 


369, 971 
698,  376 


528, 290 


538,  597 
'4i2,'852" 


406, 403 


1, 589, 957 


Agricultural 
Stabiliza- 
tion and 
Conserva- 
tion 
Service 


Conserva- 
tion 
reserve 
program 

(68) 


$5, 476,  536 


103, 223 

7,  293, 816 

2,  765, 646 

10, 114, 196 

102, 937 

315, 614 


2, 294,  727 
13, 017,  376 


3, 619,  783 
8, 002, 048 
9, 174, 866 

12, 162,  749 

18, 200, 838 
6, 622, 216 
3,009,917 
1,  579, 009 
1, 447, 917 
48, 224 
9, 850, 350 

22, 217, 290 
4,  591,  512 

12,  509, 184 
5, 801, 877 

10, 802,  717 


188, 274 

961, 251 

7, 060, 353 

6, 829, 967 

4, 272, 460 

28,  617, 009 

9, 284, 807 

16,  547, 075 

3, 473, 324 

5, 827, 842 

1,239 

8, 836, 447 

19,040,418 

7,  798,  582 

39, 150,  483 

2, 048,  390 

537,  573 

1, 885, 950 

4, 439, 029 

886, 235 

10, 643, 181 

1, 093, 194 


Depart- 
ment of 
Com- 
merce 


State 
marine 
schools 
(subsist- 
ence of 
cadets) 

(69) 


$131,085 


156,  946 
"i22,"i48' 


288, 695 


Department  of  Defense 


Air  Force 


National 
Guard  « 


(70) 


$2,  774,  787 
904, 411 
2, 965, 255 
2, 033, 805 
7, 115,  708 
3, 287,  532 

1,  671, 241 
1, 010,  770 

1, 936,  659 
1, 524, 691 
3, 449,  577 
3,435,025 
1, 646,  758 
3, 560, 946 

2,  335, 270 
2, 909, 338 
2, 042, 239 
1,  454, 165 
1, 421, 343 
1,418,017 

1,  724, 428 
3, 221, 007 

3,  501,  323 

2,  746,  449 
1, 984,  495 
3, 056,  585 
1,  589, 020 

1. 162. 159 
1, 135, 057 
1, 101,  588 
3, 102, 484 
1, 278, 367 
6, 986, 192 
1, 403,  755 
1. 380, 649 
4,871,578 

2. 627. 160 
1,  752, 955 
4, 618, 623 
1, 099, 183 
1, 430, 171 
1, 339, 622 
4, 028, 933 
5, 068, 930 
2,023,573 
1, 289, 473 
1, 039, 200 
2, 383,  561 
1, 986,  477 
3, 491, 331 

936, 099 
1, 499, 460 


Army 


National 
Guard  « 


(71) 


$11, 134, 996 
2,  543, 270 
2, 373, 612 

6,  695, 424 
18, 821, 175 

2,  348, 534 

5,  520, 203 
2,  603, 000 

1, 545, 345 
6, 195, 042 

10, 200, 346 
5, 535, 098 
3, 405, 324 

11, 069, 910 

7,  686,  670 
5, 442, 958 
5, 029, 285 
4, 354, 436 
5, 963, 671 
3, 026, 659 

6,  690, 986 
12, 316,  652 
11, 183,  675 

9, 374, 466 
9, 976, 934 
6, 297, 880 
2, 894,  707 
3, 108, 434 

1,  310, 104 

2,  536, 263 
13,  728, 447 

3, 384, 827 
22, 984, 946 

8,  666,  551 
2, 698, 364 

11,  617, 487 
5, 670, 765 
4, 874, 617 

15, 299, 649 
3, 069, 311 
7, 475,  966 
3, 364, 311 

6,  736, 300 
15, 047, 123 

4, 262, 867 
2,760,006 

7,  702, 283 
6, 638,  417 
3, 978,  796 
9, 174,  567 
1, 897, 087 
4, 825, 996 


«  108,  782,  734 


«  62, 417, 342 


Total-  - 220, 254,  566  69,  728,  315 


5,642,208  350,547,651 


234,  540. 158 


415, 461, 084 


Footnotes  at  end  of  table. 


694   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided  re- 
lief and  other  aid,  fiscal  year  1961 — Continued 

PART  B.    FEDERAL  AID  PAYMENTS  TO  INDIVIDUALS,  ETC.,  WITHIN  THE  STATES— 

Contiuued 


States,  Territories,  etc. 


Department  of  Health,  Education,  and  Welfare 


Public  Health  Service 


National 
Arthritis 

and 

Metabolic 

Diseases 

Institute 


(72) 


Nfvtional 
Neuro- 
losical 
Diseases 

and 
Blindness 
Institute's 

(73) 


National 

Cancer 

Institute 


(74) 


National 
Institute 
of  Dental 
Research  w 


(75) 


National 
Institute 
of  Allergy 

and 
Infectious 
Diseases 


(76) 


National 

Heart 
Institute 


(77) 


National 
Institute 

of 
Mental 
Health 


(78) 


Alabama 

Alaska.. 

Arizona 

Arkansas 

California.- 

Colorado 

Connecticut 

Delaware 

District  of  Columbia 

Florida.- - 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana --. 

Iowa 

Kansas.— 

Kentucky -.. 

Louisiana 

Maine  _ 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York.. 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington... 

West  Virginia.. 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories,  etc  '... 

Undistributed  to  States, 

etc 


$333,713 

33, 524 

115,690 

234,  596 

3, 802, 005 

329,  921 

752,  276 

27, 049 

808, 845 

519, 827 

314,  543 

7,720 


$51, 227 

275, 875 

19, 587 

35, 422 

3, 536, 335 

129,  446 

668,  745 


$213, 993 


264, 580 
236,  550 
290, 296 


2, 026,  240 

430,  512 

399, 808 

220, 009 

217,  740 

400,  226 

10, 300 

1,531,685 

4,617,430 

1,076,926 

1, 330,  760 

172,  797 

872,  208 

13,616 

75, 914 


1,  506,  215 

285,  703 

468, 524 

183,  898 

11.3,072 

665,  606 

-547 

1,815,599 

3,  590,  218 

995,  590 

1, 385,  378 

70,  224 

855, 368 

3,642 

51,  328 


68, 966 

99,  652 

3,  733.  465 

385,  251 

830, 940 

22, 849 

792, 181 

937, 615 

241, 007 

7,400 

4,830 

2, 033, 631 

373,  474 

277, 836 

288, 192 

258, 258 

550,  063 

466,  288 

1,313.839 

4, 343. 874 

1,144,919 

982, 457 

60,  539 

1, 230,  404 

21,095 

160, 206 


$206, 531 
""i7,"969' 


$118,  687 


$361, 732 


$105, 935 


388,  388 
2,250 
27,  611 


161, 578 
29, 185 
65, 523 


866, 199 
258,  953 
138,  907 

34, 095 
8,  .341 

43,  584 


34,  479 
729, 170 
242, 968 
110,655 


209, 420 
"68,"  190" 


119,779 
143, 099 

3, 374, 019 
561,278 
492,  992 
9.186 
692, 698 
621, 878 
392.  270 
120,  731 
4,315 

1,  599,  397 
344,  248 
186, 185 
263,  201 
94,130 
663, 018 
15,788 

1,320,636 

1,616,181 
668,  271 
530, 528 
118,463 
497. 534 
165,  450 
123, 337 


34, 615 

119,322 

4, 927, 070 

445,  609 

616,095 

15,  975 

1,453,831 

780,  431 

1, 1.33,  551 

14, 158 


2, 343,  525 

716,  794 

323,  621 

187, 082 

40.3,414 

1,087,512 

80,  982 

2, 060, 802 

4,  707, 223 

1, 149, 862 

1,  975,  233 

322,  322 

1,015,261 

18,128 

232,  463 


110,487 

527, 534 

60,469 

6,919,111 

885,  946 

29, 867 

1, 440,  250 

399,  507 

406,  322 

2,  439, 106 

78,  370 

55,  557 

41,608 

591, 569 

915,718 

644,  954 

141,734 

648,  465 
839,  628 

66,  524 

649,  918 
4,528 

147,  598 


56,  818 
337, 478 


5, 836,  538 
673,  904 


689, 664 
126, 060 
879,  395 
1, 702,  386 
387,  477 
87,  782 


564, 306 
260, 102 
306, 455 

79,  482 
604,  930 
580, 096 

53,  959 
566,  602 


61,219 

531,741 

48, 989 

8, 187,  646 

955,  493 

5, 000 

1,091,494 

267,  548 

384,  931 

3,  688,  423 

202, 604 

67, 375 

10, 000 

706,  972 

1, 377, 154 

622, 535 

82, 135 

413,016 

563, 678 

53, 636 

1,077,072 


34,423 


1,  510, 547 


90,  488 
'i,'647,'328' 


140, 824 
'i,'992,'8i6" 


1,108,802 

211,773 

2,732 

187.  382 

23, 565, 

140,  974 

557,  692 

11,343 

16, 086 

10,  333 

109, 141 

217,  757 

-2, 793 

11,737 

96,  586 

254, 118 

15,  524 

124,  521 

10,  686 

88, 680 

5.184 

151,912 


54, 862 
346, 049 

14,797 

4,  274,  720 

359, 407 

56, 031 

844,  359 

196,  767 

354,514 

1, 988.  683 

26, 138 

33,  720 
8,778 
334. 523 
830, 031 
158.1.56 
112,834 
273,  438 
596, 107 

38, 196 
741,103 

22, 076 
159,  700 


223, 145 

334, 023 

21.815 

7,113,141 

1,  473,  529 

22,  620 

1,  830, 152 

473, 127 

1,414,849 

3,655,714 

34,  792 

306, 791 

16,  554 

1,225,602 

1,  469,  356 

424,  554 

290,  534 

464,  232 

1,209,663 

75, 182 

891,  528 

4,992 

225, 184 


43,  489 
159,040 

5,  462,  498 
913,115 

1,  760, 374 

17, 047 

1,368,503 

642,  477 

420, 870 

185,  223 

37,  249 

2,  737,  663 
582, 121 
419,  743 
962,  584 
369, 841 
677, 067 
117,877 

1,440,709 

6,  609, 609 
2, 460,  480 

921,903 

117,716 

1, 353, 826 

193,911 

383,311 

20,  578 

24, 630 

609,  838 

91,276 

8,  826,  858 

1,  479,  494 

25, 514 

1, 857,  388 

387, 671 

531,740 

3,  503, 543 
271,720 
118,240 

28,  441 
607,  462 
1,094,375 
564, 234 
127,412 
353,  806 
701,872 
40, 657 
700,  552 


1, 236,  663 


1,  426,  970 


262, 216 
'579,'892 


Total. 


40,331,197    32,609,281    43,366,185 


7, 032, 154 


27, 918, 951 


61, 063,  662 


63, 242, 690 


Footnotes  at  end  of  table. 


1 


TABLES 


695 


Table  92. — Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  1961  — Continued 

PART  B.    FEDERAL  AID  PAYMENTS  TO  INDIVIDUALS,  ETC.,  WITHIN  THE  STATES— 

Continued 


Department  of  Health,  Education,  and  Welfare— Continued 

Public  Health  Service— Continued 

Oftice  of 
Education 

States,  Territories,  etc. 

Division 

of 

Research 

grants 

(79) 

Hospital 
and 

medical 
care- 
nurse 

training 

(80) 

Assistance 

to  States, 

general 

(81) 

Environ- 
mental 
health 

activities 

(82) 

Grants 

for 
hospital 
construc- 
tion i« 

(83) 

Health 
research 
facilities 
construc- 
tion 

(84) 

Education 

of  the 
mentally 
retarded 

(85) 

Alabama.. 

$297, 691 

27, 203 

105, 490 

87, 102 

6, 183, 957 

454, 290 

1, 452, 965 

45, 194 

1,118,324 

946, 332 

543, 166 

228, 271 

5,871 

2, 737,  598 

600,298 

591,822 

311,059 

350,713 

632, 983 

105,  521 

2, 331, 724 

4,671,610 

1,451,959 

1,451,609 

195,117 

1, 335, 663 

26, 009 

211,491 

11,420 

267,  576 

525, 744 

81,315 

7,108,111 

1,541,604 

25,633 

1,  627, 063 

254,311 

448,339 

2. 672,  517 

328, 396 

37,  256 

6, 998 

1,012,179 

1,163,795 

499, 552 

153,567 

390, 401 

1, 244,  538 

99,115 

1, 186,  111 

$53,670 

$5, 128 

$203, 734 

Alaska.- 

Arizona 

15,  527 

14,  521 

394,333 

351,120 

72,150 

3, 732 

3,878 

414,810 

15,380 

73, 847 

78,963 

Arkansas 

$97,  445 
9,216 

-$8 

436, 839 
36, 932 
411,197 

$20  800 

Colorado... 

29, 169 

Connecticut 

32, 025 

Delaware 

District  of  Columbia 

320, 698 

100, 203 

215,033 

4,485 

22, 487 

16, 900 

37,711 

3,956 

-1,845 

214,970 

367,015 

293, 662 

2,  500 

953 

545,  576 

334, 341 

291,225 

757,719 

641,313 

293, 641 

69,671 

361,594 

3, 012,  558 
-9,  535 

1, 191, 149 

Florida 

19, 028 
32, 823 

Georgia 

11  000 

Hawaii 

Idaho 

Illinois 

97, 873 
143, 888 
32,  723 
3,040 
10, 604 
44, 469 

44, 204 
33,  598 

4,228 

4,968 

2, 654 

105, 395 

42,801 

111,622 

23,600 

Indiana 

Iowa 

Kansas... 

Kentucky. 

Louisiana 

24, 955 

Maine 



Maryland 

104, 960 
597, 654 
135,924 
312,212 
27,  126 
180,718 
159, 675 

169,915 
277,  577 
421,492 
319,  736 

23, 272 
59, 941 
36, 171 
50, 660 

46,  564 
103, 253 
62,315 
17,613 

Massachusetts 

Michigan 

23  650 

12,200 

Mississippi 

Missouri 

53,811 

51,  750 

587,111 

386,  513 

96, 107 

Montana 

Nebraska 

Nevada 

2,847 
20,  500 
10, 806 

22, 050 

New  Hampshire 

325,  471 
355, 808 

New  Jersey 

14,  799 

7,805 
295, 181 
360, 458 

10, 200 

New  Mexico 

New  York — .. 

1, 058, 831 
133,  034 

42, 314 
43,  805 

102,998 
53,  820 

2, 364,  597 

665, 272 

94, 822 

1,493,225 

7,500 

677, 062 

1,034,437 

110, 533 

65,200 

North  Carolina 

North  Dakota 

Ohio    

179, 434 

9, 168 

64,428 

496, 456 

47, 212 
46, 266 
33, 601 
159, 113 

67, 418 

54,  794 

18,866 

Oklahoma. 

Oregon 

18,000 
50,541 

Pennsylvania.   , 

56,418 

31  887 

South  Carolina 

10, 820 
36, 266 
95,  936 
300, 749 
14,046 

South  Dakota 

7,474 
86,  784 
55,  745 

6,163 

71,011 

52, 682 

773,  560 

6,811 

167, 280 

354, 957 

558, 205 

2,477 

319,680 

Tennessee 

20, 234 
15  100 

Texas 

31, 468 
12, 880 

Utah.... 

Vermont 

Virginia 

6,722 
109, 239 

4.179 
123, 122 

3,770 
22,699 

Washington 

29, 165 

West  Virginia 

Wisconsin 

79, 946 

22,400 

Wyoming 

Puerto  Rico 

3,325 

5,184 

1,621,845 

30, 669 

111,764 

Virgin  Islands 

Other  Territories,  etc' 

Undistributed  to  States, 

50,816,992 

6,099,858 

3,374,187 

650,616 

754, 657 

20, 041, 138 

304, 306 

Footnotes  at  end  of  table. 


696 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  92. — Expenditures  viade  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided 
relief  and  other  aid,  fiscal  year  iSffi— Continued 


PART  B. 


FEDERAL  AID  PAYMENTS  TO  INDIVIDUALS,  ETC.,  WITHIN  THE  STATES— 
Continued 


States,  Territorius, 
etc. 


Alabama 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

Dlst.  of  Columbia. 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana.. 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland-- 

Massachu.setts 

Michigan 

Minnesota 

Mississippi-.- 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire.. 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio 

Oklahoma 

Oregon 

Pennsylvania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee. 

Texas 

Utah 

Vermont 

Virginia 

Washington. 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories, 

etc' 

Undistributed  to 

States,  etc 


Total. 


Department  of  Health,  Education,  and  Welfare— Cont. 


Office  of  Education- 
Continued 


Defense  ed- 
ucational 
activities 


(86) 


$379, 974 

7,248 

389,  531 

198, 605 

3, 107,  816 
641, 966 
599,  765 
301,029 

1, 016,  954 
617, 402 
718,  476 
253,  678 
182, 380 

1,  647,  053 

1,463,318 
370,  736 
431, 640 
209.  755 
674,  630 
332, 174 
272,  515 

1,  400, 983 

1,925,115 
730, 352 
264, 465 
788, 979 
226,  413 
285, 435 
118,738 
170, 339 
404, 303 
31  f,  229 

3,621,586 
799,  678 
392,  357 
868.  349 
517,551 
933,  984 

1, 765, 363 
322.  267 
198,  548 
138, 306 
693, 080 
990, 208 
391,319 
77.214 
426, 369 
861, 087 
179, 394 
596,  897 
138.  576 
134, 884 


42,  521 


34, 442, 434 


Cooperative 
research 


(87) 


$12, 

8, 
46, 

8, 

442, 

24, 

32, 

22, 

4, 
65, 
20, 

2, 


424, 022 
106, 103 
48,  376 
32, 490 


43,  400 

145, 408 

25b,  971 

139,  970 

18,327 

68,  768 


183 


18,  856 

5,359 

336, 236 

28,  769 


25, 130 


200 

370,  950 

87, 140 

138 


6,257 
114,697 
68, 416 


7,236 

2,750 

9.600 

119,  583 

260 

13,  200 


9,152 


"  3, 198. 161 


Office  of  Vocational 
Rehabilitation 


Grants 
for  special 
projects  "> 


(88) 


$14, 279 


71,  844 
-1,831 
720,717 
137,213 
132,  80S 

15,050 
304,  337 
229,  202 

54,  355 

18,  858 


220, 882 

48, 751 

96,  3 19 

54,  533 

13,  755 

41, 183 

79,  ,576 

79,  749 

265,  619 

181,516 

286,  275 

4S,  800 

300, 301 


24,  250 


69.  651 


1,661,150 

53,611 

1,  405 

342,  488 
26, 425 
17, 370 

156,  509 

129,  663 
24,  500 
34,  500 
18,372 

229,  901 
10,371 
27, 807 

197, 325 
42,  794 
26,  239 

119,612 


6,  628, 064 


Training 
and 

trainee- 
ships 


(m 


$12, 071 


27,  801 

16,385 

760,  832 

110,076 

7,580 


327. 228 

164,711 

17,  591 


486.  653 
46,  573 
66, 492 
88, 475 


42, 901 


28, 278 
530, 693 
330, 024 
183,  797 
5,454 
190.  835 


47, 906 


5,928 
49, 597 


1,477,109 

64, 374 

4,633 

232, 813 

74, 096 

62, 415 

470,  900 


22,264 


100,970 

210, 592 
81,  512 
26.838 

143, 404 
68, 942 
51,  570 

155. 852 


64, 871 


fl,  860, 036 


Social  Se- 
curity Ad 
ministration 


Cooperative 
research  or 
demonstra- 
tion projects 
in  social 
spcuritv 
(90) 


$7, 245 
6,000 


12, 960 
9,800 


12, 300 
30, 000 


48, 050 
20,190 


10, 000 
'i9,'575 


10, 060 


Department  of  Labor 


Une  mploy- 
ment  com- 
pensation   for 
veterans  pnd 
Federal  em- 
I)loyees 


{'M) 


"173,916,200 


Temporary 
extended 
unemploy- 
ment com- 
pensation 
(trust  fund) 


(92) 


$8, 262, 342 

498,  556 

2,  348,  669 

1, 886, 340 

53,161,167 

1, 314, 838 

7, 332, 044 

1,480,218 

967, 228 

6,  601, 236 

7,  503, 064 
135,  987 
573, 462 

31, 183, 874 
4, 280,  659 
2,  835, 043 
2,  245, 389 
6, 326,  504 
6, 320,  519 
813,  698 

7,  536. 826 
15,  680, 563 
46, 291, 181 

4, 609,  739 

2,  259,  574 
7, 415, 720 

882, 683 

724, 590 

993,913 

653,  690 

26, 153,  289 

744, 146 

55, 606, 837 

5, 394, 283 

49, 641 

55, 131,  551 

2, 276, 426 

3,  820, 601 
44,711.917 

3, 086,  269 

3,  425,  281 
288,  759 

8, 069,  876 

8,  807,  585 
953,  537 
175.585 

4,  588, 108 
9,510,939 
0, 350, 649 
7,914,681 

506,  546 

465,  738 

1,000 


481, 151,  560 


Footnotes  at  end  of  table. 


TABLES 


697 


Table  92.— Expenditures  made  by  the  Government  as  direct  payments  to  States 
under  cooperative  arrangements  and  expenditures  within  States  which  provided  re- 
lief and  other  aid,  fiscal  year  1961 — Continued 

PART  B.    FEDERAL  AID  PAYMENTS  TO  INDIVIDUALS,  ETC.,  WITHIN  THE  STATES— 

Continued 


States,  Territories, 
etc. 


Atomic 
Energy 
Com- 
mission 


Fellow- 
ships and 
assistance 

to 
schools  <» 

(93) 


National  Science 
Foundation 


Research 

grants 
awarded  s" 


(94) 


Fellow- 
ship 
awards  " 


(95) 


Veterans'  Admin- 
istration 


Auto 
mobiles, 
etc.,  for 
disabled 
veterans 


(96) 


Readjust- 
ment 
benefits 
and  voca- 
tional re- 
habilitation 

(97) 


Total  pay- 
ments within 
States  (Part 
B) 


Grand  total 
(Parts  A 
and  B) 


(99) 


Alabama _-. 

Alaska 

Arizona 

Arkansas 

California 

Colorado 

Connecticut 

Delaware 

District  of  Columbia. 

Florida 

Georgia 

Hawaii 

Idaho 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

Nevada 

New  Hampshire 

New  Jersey 

New  Mexico 

New  York 

North  Carolina 

North  Dakota 

Ohio... 

Oklahoma 

Oregon 

Pennsyl  vania 

Rhode  Island 

South  Carolina 

South  Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West  Virginia 

Wisconsin 

Wyoming 

Puerto  Rico 

Virgin  Islands 

Other  Territories, 

etc' 

Undistributed  to 

States,  etc 


$124, 280 


70, 084 

53, 141 

367, 943 

58,  673 

38, 815 

17, 030 

85,  757 

71, 209 

18, 161 

79, 016 

27, 148 

128, 215 

144, 936 

51, 559 

94, 141 

77, 990 

123, 062 

34, 401 

73, 901 

376,  742 

355,  760 

91,320 

40,  591 

65,  248 

88,  533 

43, 915 

1,005 

5,500 

177, 390 

67, 441 

881,419 

103,  548 

46, 055 

236, 183 

61, 606 

89, 355 

359,  706 

39, 859 

1,056 

32, 823 

307,  770 

172, 478 

17, 849 

26, 530 

116, 747 

244, 058 

42, 437 

71, 863 

27, 879 

19, 802 


$1, 099, 250 

346, 365 
1, 341, 435 

304, 335 
10, 222, 305 
2, 142, 800 
2, 162, 394 

187, 218 
6, 370,  675 
1,  765, 879 
1,  514,  758 

571,911 

252, 845 
5, 697,  504 
3, 224, 944 
1,200,407 
1,855,748 

750, 908 
1, 296, 864 

480, 087 
1,392,487 
8, 998,  586 
3,  725, 313 
1, 898, 216 

569, 700 

1,  630,  787 
374, 436 
432,  783 

85,  590 
724, 290 

2,  735,  776 
867, 125 

10,  694,  734 
1, 883,  709 

360, 979 
3, 271, 278 
1, 614, 620 
1, 928,  391 
7, 005, 406 
1,245,269 

573, 618 

775, 534 
1,  538, 770 
4, 015, 106 
1, 213, 030 

274,  607 
1, 225, 090 
1, 923, 332 

346, 861 
3, 618, 013 

208,  558 


$92, 
13 

89: 

71 

1, 490, 

112 

228, 

53 
121 
129 
120 

34 

32: 
1,014 
427, 
280, 
179 
104 
149, 

49, 
232, 
686, 
642, 
307, 

78, 
306, 

70, 

77, 
8 

51 
384 

62 

1,  537 

200, 

40, 
603 
176, 
157 
729, 

68, 

58, 

52, 
170 
417 
107 
7, 
124, 
322, 

62, 
375, 

35, 


$11,059 


14, 400 
9,600 
46, 003 
14, 395 
11, 200 
1,600 
17, 600 
36, 800 
20,  796 


3,200 

22, 349 

12, 800 

9,600 

12, 695 

8,000 

19, 195 

12,800 

8,000 

22, 400 

24, 000 

22, 400 

6,400 

9,600 

3,200 

11, 200 

1,600 

1,600 

9,600 

1,600 

31, 975 

18, 945 

4,800 

23,  795 

19, 200 

8,000 

51, 023 

17, 600 

6,400 

1,600 

12, 120 

39, 950 

1,600 


12,  725 
23,  600 
3,200 
16,000 
1,600 
3,200 


$8, 800, 165 
85, 069 

2,  517, 444 

3,  009, 370 
27, 308, 944 

4, 249, 284 
2,  518, 896 

248, 990 
6, 031, 389 
9,  785, 447 
8, 973, 320 

599,  537 
1,011,720 
9, 043, 529 

4,  716, 450 
3, 709, 104 
2, 203, 654 
3,711,053 
6,511,057 

999, 651 
1, 446,  701 
7, 211, 453 
8, 257, 952 
4, 260, 087 
2, 978, 324 
6, 227, 952 
1, 038, 946 
1, 854, 495 

214, 967 

646, 450 
5, 128,  584 

999, 865 

16, 407,  751 

5, 151, 370 

1, 641, 233 

8, 260, 678 

4,  560, 496 

1, 390, 391 

14, 383, 312 

1,191,037 

4, 181,  528 

1, 699, 381 

5, 416, 699 

14, 398, 045 

2, 349,  699 

427, 633 
2, 864, 436 
6, 063,  766 
2,601,849 
4, 603, 320 

423, 903 
4, 942, 728 


609, 685 


7,234 


4, 230,  525 


$49,018,393 
6, 000,  792 
16, 249, 087 
29,  676, 890 

196, 194,  590 
40, 696, 865 
29, 219, 991 
6, 974, 932 
28, 456, 321 
41,811,341 
60, 488, 426 
20, 946, 861 
18, 051, 859 

104,  714, 958 
47, 495, 353 
41, 662, 223 
45, 433, 899 
37, 090, 922 
46, 136, 447 
11,811,961 
37,  696,  205 
90, 900, 935 

111,277,447 
69, 489, 173 
32, 886,  782 
60,  753, 389 
21, 542,  780 
30, 402, 251 
4, 721,  500 
8, 280, 674 
61, 379, 522 
18,  612, 952 

199,  299, 838 
48,  530, 499 
42,  682, 281 

124,  500, 006 
46,  777, 246 
29,  636, 325 

139, 207, 462 
12, 883, 125 
32, 301, 214 
32,  590, 385 
50,  651, 131 

125, 157, 176 

20, 827,  567 

8, 456, 117 

30, 891,  567 

61, 052, 099 

21, 024, 186 

56, 108, 930 

9, 878, 417 

30, 200, 361 

17, 276 

14, 424, 569 

171, 242, 597 


$221, 154, 422 

48, 440,  796 

91, 700, 645 

129, 735, 431 

829, 169,  678 

138, 834, 341 

114,729,782 

21, 948, 387 

93, 416, 328 

217, 350, 561 

243,  723, 604 

51, 144, 396 

60, 784,  699 

457,  510, 865 

188,  758, 996 

139,  718, 866 

137, 493,  732 

172,841,117 

245, 904, 074 

53, 893, 024 

130, 188, 890 

262, 629, 835 

356, 157,  701 

211,  784, 796 

154, 098,  052 

258, 409,  076 

73, 537,  514 

100, 937,  023 

28, 015, 402 

38, 043, 399 

193,  745, 487 

96, 300,  722 

660, 044, 802 

194, 842,  781 

85, 230, 008 

429,  586, 322 

215, 277, 078 

136,  429,  547 

450, 156, 364 

47, 139, 110 

121,  704, 973 

82,  559, 164 

223, 916, 299 

485, 855, 296 

74, 180,  666 

36, 337,  503 

163,301,258 

170, 826,  786 

112,415,902 

163, 183, 474 

57, 402,  604 

104, 855, 489 

8, 057, 023 

24, 435, 989 

216, 439, 271 


Total 5,951,930  » 110, 550, 317  12,959,997  703,025  253,489,629  2,724,416,162  9,826,279,362 


Footnotes  on  followhig  pages. 


698   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

FOOTNOTES  FOR  TABLE  92 

1  Excludes  $500,000,  "State  experiment  stations.  Agricultural  Research  Service."  shown  in  column  6. 

2  Excludes  $1,595,000,  "Cooperative  extension  work,  payments  and  expenses.  Extension  Service,"  shown 
In  column  6. 

3  Includes  $58,517,787,  value  of  commodities  distributed  to  participating  schools,  and  payments  of  $5,191,636 
made  directly  to  private  and  parochial  schools.  In  addition  the  school-lunch  program  is  a  recipient  of  some 
of  the  commodities  under  the  appropriation  "Removal  of  surplus  agricultural  commodities,"  and  under 
"Commodity  Credit  Corporation,  value  of  commodities  donated." 

*  Consists  "of  $35,408,615,  "Payments  to  States  and  Territories  from  the  National  forests  fund";  $139,726, 
"Payments  to  school  funds,  Arizona  and  New  Mexico,  act  June  10,  1910  (receipt  limitation)";  and  $123,275, 
"Payment  to  Miimesota  (Cook,  Lake,  and  St.  Louis  Counties)  from  the  national  forests  fund." 

'  Consists  of  $500,000,  "State  ex-periment  stations.  Agricultural  Research  Service";  $1,595,000,  "Coopera- 
tive extension  work,  payment  and  ex-penses.  Extension  Service";  and  $1,195,000,  "Payments  to  States, 
Territories,  and  pos.sessions.  Agricultural  Marketing  Service." 

6  Consists  of  $11,436,136,  "Forest  protection  and  utilization.  Forest  Service"  and  $6,475,  "Assistance  to 
States  for  tree  planting.  Forest  Service." 

'  Includes:  American  Samoa,  Canal  Zone,  Guam,  Trust  Territory  of  the  Pacific,  and  certain  foreign 
countries. 

8  Penalty  mail  costs  for  which  a  breakdown  by  States  is  unavailable. 

»  Consists  of  .$2,490,326,  penaltv  mail  costs,  and  $5,902,384,  retirement  costs  of  extension  agents. 

10  Consists  of  $21,311,107  for  "Watershed  protection.  Soil  Conservation  Service,"  and  $11,137,911  for  "Flood 
prevention.  Soil  Conservation  Service." 

"  Estimated  cost  of  perishable  food  commodities  acquired  through  price  support  operations. 

'2  Cash  payments  to  States  to  increase  consumption  of  milk  by  children  in  schools.    Net  of  refunds. 

13  Consists'of  $29,037,366,  forest  highways,  and  $2,761,512,  public  lands  highways. 

»  See  also  under  Part  B. 

15  Consists  of  $381,008,  "Food  Stamp  Program  payments,"  and  $195,269,396,  "Value  of  commodities 
distributed." 

18  Credit  amounts  are  refunds  of  advances  in  prior  years. 

n  Consists  of  $2,550,000,  "Colleges  for  agriculture  and  the  mechanic  arts,"  .$2,501,500,  "Further  endow- 
ment of  colleges  of  agriculture  and  the  mechanic  arts,"  and  $2,225,000  (Hawaii)  "Land  grant  college  aid." 

18  Consists  of  $32,643,768,  "Promotion  and  further  development  of  vocational  education,  Ofhce  of  Educa- 
tion," and  $7,153,957,  "Promotion  of  vocational  education,  act  of  Feb.  23,  1917,  Ofhce  of  Education." 

le  includes  $1,150,842  for  treatment  of  leprosy  patients,  Hawaii,  paid  from  "Hospitals  and  medical  care, 
Public  Health  Service." 

20  Includes  $847,753,  supplies  and  services  furnished  in  lieu  of  cash. 

21  Includes  .$48,970,  supplies  and  services  furnished  in  lieu  of  cash. 

22  Excludes  $248,844,  paid  to  water  pollution  interstate  agencies. 

23  Includes  —$2,983  for  "Surveys  and  planning  for  hospital  construction." 
2<  Includes  $2,445,809  for  "Construction,  mental  health  facilities,  Alaska." 

26  Consists  of  $15,548,383,  "Federal  aid  in  wildlife  restoration.  Bureau  of  Sport  Fisheries  and  Wildlife," 
and  $5,376,636,  "Federal  aid  in  fish  restoration  and  management.  Bureau  of  Sport  Fisheries  and  Wildlife 
(receipt  limitation)."  ,      ,,  „     ,  ^  .        .    , 

2«  Consi.sts  of  $486,.594,  "Payments  to  counties  from  receipts  under  Migratory  Bird  Conservation  Act, 
Bureau  of  Sport  Fisheries  and  Wildlife,"  and  $1,797,  "Payments  to  Alaska,  Alaska  game  law,  Bureau  of 
Sport  Fisheries  and  Wildlife."  ,       .      ,  , 

27  Consists  of  $252,246,  "Payments  to  States  from  grazing  receipts,  etc.,  public  lands  withm  grazing  dis- 


(rcccDit  1 - ,,___,_..  „  _ 

'"payments  to  Territory  ofAlaska,  income  and  proceeds,  Alaska  school  lands";  $72,764,  "Payments  to  Coos 
and  Douglas  counties,  Oregon,  from  receipts,  Coos  Bay  wagon  road  grant  lands";  $11,801,  "Operation  and 
maintenance.  Bureau  of  Reclamation";  .$920,  "Payments  to  States  (grazing  fees).  Bureau  of  Land  Manage- 


.^^.rginal  land  progra...,  ^  ,  ,i, .,■,,.,-   ,, 

counties,  subrniirginal  land  program.  Farm  Tenant  Act,  Bureau  of  Sport  Fisheries  and  Wildlife. 

29  Consists  of  $5,728,726,  education  and  welfare  services  and  .$690,035,  resources  management. 

20  Consists  of  $8,488,688  for  postage;  $146,378  for  other  expenditures;  and  -$3,477,015,  representing  credits 
to  miscellaneous  costs  of  administering  the  program;  breakdown  by  States  unavailable. 

30  Consists  of  $581,843,  "Grants-in-aid  for  airports";  and  $64,215,753,  "Grants-in-aid  for  airports,  liquida- 
tion of  contract  authorizations." 

31  Payment  in  lieu  of  taxes. 

32  Paid  from  "Inpatient  care.  Veterans  Administration." 

33  Paid  from  "General  operating  expenses.  Veterans  Administration." 

31  Consists  of  $6,033,270,  "Transitional  grants  to  Alaska";  $774,928,  "Alaska  public  works.  Interior'  ;  and 
$1,050,002,  "Payments  to  Alaska  from  Pribilof  Islands  Fund,  Interior"  (shared  revenues). 

35  Construction  and  rehabilitation,  Bureau  of  Reclamation.  Interior  Department. 

30  Consists  of  $25,000,000,  "Federal  payment  to  District  of  Columbia";  $610,404,  "Hospital  facilities  in 
the  District  of  Columbia,  General  Services  Administration";  and  $2,700,000,  "Federal  contribution  to 
District  of  Columbia,  Metropolitan  Area  Sanitary  Sewage  Works  Fund  " 

3'  Center  for  Cultural  and  Technical  Interchange  between  East  and  West,  State. 

3'  Boulder  Citv  Municipal  Fund,  Bureau  of  Reclamation. 

39  Drainage  of  anthracite  mines,  Bureau  of  Mines,  Interior  Department. 

<o  Disposal  of  Coulee  Dam  community.  Bureau  of  Reclamation,  Interior  Department. 

<i  Internal  revenue  collections  for  Puerto  Rico  (sliared  revenues). 

«2  Internal  revenue  collections  for  Virgin  Islands,  OlTice  of  Territories,  Interior  Department  (shared 
rGVcnuCvi) 

<3  Consists  of  $2,480,800,  Grants  to  American  Samoa  from  "Administration  of  Territories,  Office  of  Terri- 
tories" and  $5,783,500,  "Trust  Territory  of  the  Pacific  Islands,  Office  of  Territories." 

"  Consists  of  $219,705,365,  "Agricultural  Conservation  Program,"  and  $549,201,  "Emergency  Conserva- 
tion Measures." 


TABLES 


699 


FOOTNOTES  FOR  TABLE  92— Continued 

«5  On  obligation  basis. 

«  Accounted  for  by  tlie  National  Guard  Bureau;  breakdown  by  States  unavailable. 

<7  Consists  of  $3,147,812,  "Salaries  and  expenses"  and  $50,349,  "Consolidated  working  fund." 

<'  Includes  $2,873,512,  representing  fiscal  year  1960  unemployment  compensation  for  veterans  and  Federal 
employees  unexpended  balances  returned  by  the  States  and  credited  to  the  fiscal  year  1961  appropriation. 

"  Consists  of  $3,520,946,  equipment  grants;  $1,134,206,  student  fellowships;  $1,216,863,  faculty  training; 
and  $79,915,  material  and  services.  The  fellowship  awards  are  included  in  the  State  in  which  the  awards 
are  to  be  used. 

'0  By  State  of  the  recipient  institution. 

81  Based  on  State  of  permanent  residence  of  recipient. 

«  Consists  of  $110,037,507  for  research  grants  and  $512,810  for  International  Geophysical  Year. 

Note. — Compiled  from  figures  furnished  by  the  departments  and  agencies  concerned  pursuant  to  Treas- 
ury  Department  Circular  No.  1014,  Aug.  8, 1958  (see  exhibit  70,  p.  381,  in  the  1958  annual  report). 


Customs  Statistics 

Table  93. — Summary  of  customs  collections  and  expenditures,  fiscal  year  1961 
[On  basis  of  Bureau  of  Customs  accounts] 


Collections 

Amount 

Appropriations  and  expenditures 

Amount 

Customs  collections: 

Duties  on  imports 

$1,007,755,214 
6,983,536 

Appropriation  for  salaries  and  expenses, 
Bureau  of  Customs    . . 

$59,815,000 
1,066,800 

Miscellaneous     collections 
(fines,  penalties,  etc.)  '... 

Transferred  from  Department  of  Com- 
merce for  export  control 

Transferred  from  Department  of  Agricul- 
ture for  quarantine  purposes 

Total 

1, 014, 738,  750 

1, 263, 700 

Total 

Collections  for  other  depart- 

406,378,856 
1, 928, 646 

62, 145, 500 

Expenditures,  obligations  incurred  by: 
Collectors  of  customs..  

Intemal  revenue  taxes 

Other  Government  agen- 

41,183, 796 

cies 

Appraisers  of  merchandise 

9,  765,  614 
870, 515 
6,  717,  658 
1, 236, 508 
2,335,471 

Total  for  others 

408,307,502 

Agency  Service  (investigations) 

Total  collections 

1,423,046,252 

Executive  direction. 

Total  obligations  Incurred  „ 

62, 109, 562 

Balance  of  appropriations . 

35, 938 

Expenditures    for   excessive   duties   and 
similar    refunds,    and    for    drawback 
payments 

25, 439, 532 

'  Includes  miscellaneous  customs  collections  of  Puerto  Rico. 


614359—62- 


-45 


700    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  94. — Customs  collections  and  payments  by  districts,  fiscal  year  1961 


District 


Collections 


Duties  and 
miscellane- 
ous customs 
collections 


Internal 
Revenue 
Service 


CoUec- 

tions  for 

others 


Total 


Payments 


Refunds 


excessive 
duties 
and 
similar 
refunds 


Draw- 
back 


Expenses 
(net  obli- 
gations) 


Alaska 

Arizona 

BufTalo 

Chicago 

Colorado 

Connecticut 

Dakota... 

Duluth       and 

Superior 

El  Paso 

Florida 

Galveston 

Georgia.. 

Hawaii 

Indiana. 

Kentucky 

Laredo 

Los  Angeles 

Maine    and 
New  Hamp- 
shire  

Maryland 

Massachusetts.. 

Michigan 

Minnesota 

Mobile - 

Montana  and 

Idaho 

New  Mexico 

New  Orleans.-. 

New  York 

North  Carolina. 

Ohio 

Oregon 

Philadelphia... 

Pittsburgh 

Rhode  Island... 

Rochester 

Sabine 

St.  Lawrence. .- 

St.  Louis. 

San  Diego 

San  Francisco.. 
South  Carolina. 

Tennessee 

Vermont.. 

Virginia 

Washington 

Wisconsin 

Puerto  Rico  '... 
Items  not 
assigned  to 
districts 

Total 


$289,  057 
5,  993,  78' 
11,707,288 
32,  847, 8.52 
929,  435 
3, 402, 1 
4, 668,  962 

3,  230,  572 

3,  743, 341 
17,091,490 
20,121,2,50 

5, 340,  020 

4,  810, 557 
1, 325,  036 
2, 285,  821 

10,  677,  828 
56,  564, 


2,  560,  800 
26, 195,  .530 
51,235,  .526 
27,  573,  742 
2,  408,  677 
2,  698,  589 


2, 340, 


25, 
481, 

13, 
9, 
7, 

57, 
1, 


$1,5 

2,875 

3, 154,  475 

28,155,441 

1, 095, 102 

4,  745,  577 

1,552 

18, 405 

11,788 

13,  464,  799 

8, 837,  510 

941,981 

1, 025, 851 

4,  994,  320 

4,  966,  246 

37, 148 

22,  777, 236 


31,338 
10,773,132 
12, 043,  731 
68.051,608 
2,  779,  717 
629,  401 


1,120 
172 
409, 030 
241,  851 
503,  649 
620,  597 
823, 189 
055,  263 
337,  386 
336,  22': 
025,  905 
35,  332 
098,  738 
134,  844 
145,  656 
632,  739 
456,  025 
578,  682 
671,450 
904,  836 
481,  870 
743,  440 
49 


228 

2,861 

420 


1,400 
241 


443 
690 
109 


1,916,587 


296 


1,446 
786 


378 
194 


$290,  629 
5,  996,  662 
14,  861,  832 
61,003,46' 

2,  024,  537 
8,147,773 
4, 670, 514 

3,249,157 

3,  755, 129 
30,5.56,517 
28,  961, 621 

6, 282,  421 
5,  836,  487 
6,319,956 
7, 252,  067 
10,  716,  376 
79, 342,  225 


2,  592, 138 
36,  969, 105 
63,  879,  947 
95, 625,  459 

5, 188, 394 
3, 327, 990 

2,341,169 

84,  471 

30,143,718 

608,  309,  809 

13,  812, 356 

15, 563,  764 

8,910.969 

65, 676,  525 

3, 994,  582 

3,  982,  280 

5,  424,  341 
589,  457 

33,512,232 
13,417,826 
3,  734,  433 
58,915,387 
9, 257,  765 
1, 864,  569 

6,  298,  539 
17,319,776 
27, 910, 830 

4,968,815 
130, 221 


$273 
302,  408 
180. 970 
377, 827 
17,240 
19, 608 
31,826 

37,  701 

19, 124 

282,  310 

311,28 

37,  214 

158, 193 

6,225 

106,  750 

269, 382 

843, 787 


72,  214 
493,  027 
1,  000,  446 
345, 637 
30, 008 
34, 518 

26,  405 


$21,  723 
486,  751 


183, 606 

,  974,  712 

78,  204 

197,  468 

102.965 

904,  002 

27,619 

52, 157 

27,531 

3,513 

67, 127 

51,448 

29,  410 

602,  031 

88,  284 

9,089 

22, 029 

154,504 

230, 413 

30, 734 

504 


32,009 


32,015 


63,  063 
1,035 

549 
4, 

15,6.50 

174, 308 

985 

1,266 

11,391 

90,  969 

9,123 

131, 626 


17,401 
297,  764 

47,  868 

945, 242 

589 


415, 

6,  450,  993 

146,  867 

1,049,148 

31,587 

666,  744 

46, 376 

2,662 

40,  659 


9,140 
17,810 

2,489 

222,717 

11,105 

11,426 

2,239 
52,  243 
17,025 
75,  749 


$217,226 

479,  644 

1,  632.  949 

1,  500,  075 

82.913 

187,  649 

611,  563 

347,  973 

755.  665 
2, 183,  275 

948. 329 
281, 021 

756,  632 
113,112 

74,174 
2, 254, 389 
3,  056, 101 


1,117,176 
2,150.003 
2,  936,  649 
2,  097,  483 
259,  552 
211,555 

317,713 
45,  946 

1,954,993 

19,  599,  775 

207, 804 

703,  684 

440,219 

1,991.386 
1.56,057 
168, 839 
212,310 
125, 530 

1,178,654 
308,  284 
822, 516 

1,  904,  530 

209,  294 

84,  022 

1,180,509 
681, 122 

1,831,422 
197,319 


2,139 2  3,532,526 


1,  014,  738,  750 


406, 378, 856 


1,928,646 


1, 423, 046, 252  13, 843, 869  11, 595, 663 


62, 109,  562 


1  Collections  of  $11,702,746  deposited  to  the  trust  fund:  Refunds,  transfers,  and  expenses  of  operations, 
Puerto  Rico.  Bureau  of  Customs. 
*  Washington  headquarters  and  foreign  offices. 


TABLES  701 

Table  95. — Merchandise  entries,  fiscal  years  1960  and  1961 


Type 

1960 

1961 

Percentage 
increase,  or 
decrease  ( — ) 

Entries: 

1,389.085 

87, 009 

373. 208 

1,042,993 

3,023,516 

550,  712 

5, 975 

1, 149, 223 

1, 321, 925 

76.198 

380,  737 

1, 139,  896 

3,  762,  548 

579,  206 

3.921 

1, 402, 323 

—4  8 

Warehouse  and  re  warehouse    -       - -_    - 

—12  4 

3  6 

Mail - 

9  3 

24  4 

Informal 

5  2 

Appraisement        _-.-.          .           .. 

—34  4 

All  other 

22  0 

Total 

7,621,721 

8,  672,  754 

13.8 

Table  96. 


-Principal  commodities  on  which  drawback  was  paid,  fiscal  years  1960 
and  1961  ^ 


Commodity 


Percentage 
increase,  or 
decrease  (— ) 


Aluminum 

Iron  and  steel  semimanufactures 

Nonmetallic  minerals  and  manufactures.. 

Sugar - 

Tobacco,  unmanufactured 

Chemicals 

Petroleum  and  products 

Lead  ore,  matte,  pigs,  and  bars 

Watch  movements 

Cotton  cloth 

Paper  and  manufactures 

Medicinal  preparations 

Copper  and  manufactures 

Tungsten  ore 

Chromium  and  alloys 

Coal-tar  products 

Motor  vehicle  and  aircraft  parts 

Manganese  ore 

Zinc  ore  and  manufactures 

Tires  and  tubes,  rubber  and  synthetic 

Barley 

Burlap 

Rayon  and  other  synthetic  textiles 

Steel  mill  products 

Nickel --- 

Pigments,  paints,  and  varnishes 

Machinery  and  parts 

Wool  fabrics 

Vegetable  fats,  oils,  and  wa.xes 

Animal  fats  and  oils 

Quicksilver  and  mercury 

Wool  and  semimanufactures. 

Clay  and  clay  products 

Flax,  hemp  and  ramie,  and  manufactures 

Cotton,  unmanufactured 

Electrical  machinery , 

Brass  and  bronze  manufactures 

Fruits  and  fruit  preparations 

Nuts  and  preparations 

Citrus  fruit  juices 

Bauxite  ore 

Other. 

Total... , 


$958, 513 

463, 518 

428, 365 

517, 828 

719, 350 

231,  837 

559,  575 

318, 125 

305, 380 

221,  892 

377, 951 

21, 956 

77, 902 

162,  657 

27,  572 

78, 404 

51, 055 

80, 251 

150, 295 

120,  664 

105, 743 

49, 835 

251,  334 

171,005 

55, 906 

71, 189 

78,  520 

35,  645 

5,253 

13,  645 
14, 842 
15,  662 
37, 493 
11,015 

4,442 
40,  683 

9,624 
20, 278 

14,  337 
9,963 

54, 025 
'  376, 484 


7, 320, 013 


$1,  781,  283 

845,  618 

582, 842 

590, 088 

564,  683 

450,  737 

441,729 

394,  680 

355, 148 

313, 084 

300, 356 

291,834 

251,  565 

239, 905 

207,  006 

170,  533 

165, 802 

165, 108 

136,  529 

132,  930 

104, 106 

86,  619 

75, 123 

74, 032 

47, 146 

34,  703 

32, 970 

29,  810 

27,  926 

25,  610 

24,  731 

24, 196 

21,  580 

19,  642 

19,218 

15,  705 

15,  666 

15, 179 

11,275 

4,963 


1, 462,  694 


10, 554, 354 


85.8 
82.4 
36.1 
14.0 

-21.5 
94.4 

-21.1 
24.1 
16.3 
41.1 

-20.5 


(?) 


(?) 


47.5 
) 

117.5 

) 

105.7 

-9.2 

10.2 

-1.5 

73.8 

-70.1 

-56.7 

-15.7 

-51.3 

-58.0 

-16.4 

87.7 
66.6 
54.5 
-42.4 
78.3 

-61.4 
62.8 
-25.1 
-21.4 
-50.2 


(2) 


■•  Revised. 

'  Includes  Puerto  Rico. 

2  The  amount  of  increase  is  so  large  that  a  percentage  comparison  is  inappropriate. 


702   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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coco  CO  CO  CO  CO  CO  CO  ■<!*< 


sg 


OJO<-'C^fOTp»c«ot^ooaa 


TABLES 


703 


O  CO 

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^a 


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I  ^ 


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T-^  os"  i-T  oT  oT  CO  *o  t^  CO  lo  00 

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CO»-llOOO(NC<)Tf000505«0 

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COOiCJCOCOtDf-Hr-iOO'OCO 
C^COt>."*J*CO(NCOCO(MC^C0 


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odiJ"coco'"»ocD05'Tt^r-ri-r»o 


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t^u:ios-«^rHi^©o»coco 


€^CO-^CQCO  WC 


COt^COC<»OCOCOCO'«*<000 
Ot^OSrtt^OOOJCDiMCDoO 
l>»OOC<!.-l(N01CDOt^lM03 

i-T  f^oT  CO  CO  ui"  r-T  05  cT  f-H  oT 


5^HC^COTt<lO'£>r^OOOS 


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704   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  98. — Computed  customs  duties,  value  of  imports  entered  for  consumption, 
and  ratio  of  duties  to  value  of  dutiable  imports  and  to  value  of  all  imports,  calendar 
years  1949-69  i 

[Dollars  in  thousands] 


Calendar  year 


1949 
1950 
1951 
1952 
1953 
1954 
1955 
1956 
1957 
1958 
1959 


Computed 
duties 

(including 
taxes  on 
imports) 


$364, 
522, 
591, 
570, 
584, 
529, 
633, 
709, 
745, 

'820, 
1, 051, 


Value  of  imports  entered 
for  consumption 


Total 


$6, 591, 

8,  743, 

10,817, 

10,  747, 

10,  778, 

10, 239, 

'U,  336, 

^2,  515, 

'12,950, 

'  12,  739, 

14, 987, 


Dutiable 


'  $2,  708, 454 
'  3, 976,  304 
■■4,823,900 
'  4, 490,  546 
■■  4,  859,  403 
■•4,571,613 
■■  5,  300,  153 
'  6,  281.  233 
■■6,914,206 
■■  7,  397, 868 
9, 165, 346 


Ratio  of 
dutiable 
to  total 


Percent 
Ml.  09 
'  45. 48 
'  44.  59 
'41.78 
■■45.08 
'44.65 
'46.75 
'  50. 19 
'  53.  39 
'  58, 07 
61.16 


Ratio  of  duties  to 
value  of— 


Dutiable 
imports 


Percent 

13.46 

'  13. 14 

'  12.  26 

'12.69 

12.03 

'11.57 

'11.95 

'11.30 

'  10.  79 

'11.09 

11.48 


Total 
imports 


Percent 
5.53 
5.97 
5.47 
5.30 
5.42 
5.17 
5.59 
'5.67 
'5.76 
6.44 
7.02 


'  Revised. 

'  Amount  of  customs  duties  is  calculated  on  basis  of  reports  of  Bureau  of  the  Census  showing  quantity 
and  value  of  merchandise  impoited. 

For  figures  for  e  irlier  years  see  corresponding  tables  in  previous  reports,  beginning  with  1867  in  the  1930 
annual  report,  p.  523. 


p 


TABLES 


705 


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0^  o  J^ 

to) 

lis 


o 


"HS 


2B 


S2  ^  l£5  ::f  ^  '^'  "^  "^  ^  '^"  00  Tj^  CO  c  csi  o  <m" 


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ooj;-^ccO(Nt-^!>iodoi(rcioi^Troort-<*5 


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^co--HCOTrcN05iO'^r=;oiJ-(U;-;ioo      c^ 


.-.  COcDOi  ^  C 


5  O  I— I  »0  CO  t^  o 


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rOO-^OiOOO)<MO 


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£2J?9Sr'^"^=^c^i--;oooiiocioocoTt« 
cot^ot-^ccxor^corj-coi^-cooit^tcioo 
o  c^  oTcTi-H  T^n'o'c-f  r^cvTco -"HcorCcfi-r-^ 


C^l 


a  S"S  a  S  5  3-«  3  -^ 

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^  ^  -    -Scfeo 


C3X3 


d  o) 


S  R  C3  S  "  ft  t/,"S   '^  C3  o  o  " 
■Hl-lqM'rt_S3_-c3_c3fcHt, 

^4S  a  =3  c  g 
j=  S  "5  ^o  a~  oEfe-Sn^  ^ 


°t^BS'2-3§aft6 


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O^  (N  CC  -^  10 


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CD     .   3 


706   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  100. — Value  of  dutiable  i77iports  for  consumption  and  computed  duties  collected 
by  countries,  fiscal  years  1959  and  1960 


Country 


Value 


1959 


1960 


Duty 


1959 


1960 


Percentage 

increase,  or 

decrease  (— ) 


Value 


North  America: 

Canada  • 

Cuba 

Central  American  coun- 
tries  

Dominican  Republic 

Haiti - 

Jamaica 

Mexico , 

Netherlands  Antilles 

Trinidad  and  Tobago 

Other— 

Total  North  America.  . 

South  America: 

Argentina 

Bolivia 

Brazil 

Chile 

Colombia 

Ecuador 

Paraguay. - 

Peru. 

Surinam 

Uruguay 

Venezuela 

Other 

Total  South  America... 

Europe: 

Austria 

Belgium.. 

Czechoslovakia 

Denmark 

Finland 

France 

West  Germany,  Federal 

Republic  of » 

Greece 

Hungary 

Iceland 

Ireland  (Eire)' 

Italy 

Netherlands 

Norway 

Poland 

Portugal 

Spain 

Sweden 

Switzerland 

Turkey... 

U.S.S.R 

United  Kingdom 

Yugoslavia 

Other 

Total  Europe 


1,180,767,696 
437,208,056 

22, 516, 487 

27,  750, 578 

2, 042, 953 

2,648,217 

262,083,018 

208, 488, 343 

45, 757, 078 

3, 242, 644 


$1,358,956,596 
430, 840, 983 

28, 376, 537 
25,851,769 
3, 396, 823 
3, 850, 448 
234, 823, 837 
133, 655, 541 
22, 014, 772 
4,990,009 


$76, 906, 524 
39, 235, 676 

1,311,721 

2, 095,  504 

246, 805 

393, 901 

28, 616,  795 

7, 198, 967 

1,815,839 

268, 134 


$87,  791, 651 
47, 859, 650 

1,780,949 

2, 225, 670 

490, 600 

665, 832 

29, 816, 396 

4,  044,  426 

883, 147 

839, 531 


15.1 
-1.5 

26.0 
-6.8 

66.3 

45.4 
-10.4 
-35.9 
-51.9 

53.9 


2,192,505,070 


2,246,757,315 


158,089,866 


176, 397, 852 


2.5 


73,  782, 798 

5, 350, 379 

63, 746, 934 

15, 255, 625 

38, 056, 831 

2, 635, 474 

4, 958, 678 

55, 977, 761 

978, 483 

16, 687, 168 

745, 505, 300 

567,  725 


39,501,358 

3,929,032 

60, 099, 643 

59, 520, 977 

48, 766,  710 

2, 513, 421 

3,373,413 

47, 055, 960 

1,185,611 

18, 399, 936 

675, 957, 022 

657, 075 


11, 622, 188 

743,057 

4,915,506 

1,559,419 

1,322,730 

228, 937 

825, 095 

5, 886, 604 

191,371 

4,655,031 

24, 548, 819 

61, 588 


6,107,811 

514,032 

5,481,550 

3,944,977 

1, 857, 828 

286, 689 

492, 388 

5, 430, 553 

210, 327 

4, 762, 476 

24, 009, 660 

61, 193 


-46.5 

-26.6 

-5.7 

290.2 

28.1 

-4.6 

-32.0 

-15.9 

21.2 

10.3 

-9.3 

15.7 


1,023,503,156 


960, 960, 158 


56, 560, 345 


53,159,484 


-6.1 


49, 318, 754 

290, 869, 843 

8, 149, 521 

73,482,567 

16, 4.58,  711 

324, 688, 703 

695, 156, 708 

33, 399, 477 

1,553,396 

9,913,999 

18, 734, 771 

299, 203, 679 

154,099,782 

36,  767, 982 

24, 963, 678 

14, 325, 222 

55, 404, 046 

103,  780, 652 

143,915,283 

55, 688, 701 

614,113 

786, 996, 112 

29,  784, 354 

5, 843, 739 


53, 727, 332 
361,433,512 
11,389,820 
80,741,612 
21,651,848 
404, 956, 541 

903, 667, 042 

34,  740, 946 

1,784,003 

9, 060, 264 

22, 840, 030 

376, 264, 110 

167, 481, 151 

57, 849, 471 

28, 744, 864 

22, 587, 207 

75, 668, 014 

133, 879, 329 

175,021,684 

61,629,3.54 

970, 768 

907,815,614 

35, 970, 368 

4. 910, 626 


7,  679, 406 
29,  736, 089 
2, 552, 815 
5, 733, 951 
1,915,905 
40,  523, 658 

93, 238, 966 

5,380,951 

386, 069 

903, 281 

2, 742, 316 

54,991,990 

15,369,935 

2, 884, 086 

2,031,645 

3, 846, 108 

9, 673, 454 

12,051,191 

43, 978, 690 

11,235,446 

124,039 

115, 989, 637 

3, 582, 045 

1,803,135 


8, 683, 122 
35, 784, 353 
7, 969, 438 
6, 985, 313 
2,618,401 
51,411,729 

118, 609, 665 

5, 483, 768 

491, 915 

1,006,952 

2, 252, 285 

70, 969, 563 

16, 496, 887 

3, 868, 483 

11, 823, 087 

5, 802, 695 

13,010,231 

15, 577, 691 

43, 256, 244 

11,018,753 

268, 290 

126, 516,  267 

4, 510, 563 

1, 782, 918 


24.3 
39.8 
9.9 
31.6 
24.7 

30.0 
4.0 
14.8 
-8.6 
21.9 
25.8 
8.7 
57.3 
15.1 
57.7 
36.6 
29.0 
21.6 
10.7 
58.1 
15.4 
20.8 
-16.0 


3, 233, 113, 693    3, 954, 785, 510 


468, 354, 808 


566, 198, 613 


22.3 


TABLES 


707 


Table  100. —  Value  of  dutiable  imports  for  consumption  and  computed  duties  collected 
by  countries,  fiscal  years  1959  and  1960 — Continued 


Country 


Value 


1960 


Duty 


1960 


Percentage 

increase,  or 

decrease  (— ) 


Value 


Duty 


Asia: 

Arabia  Peninsula  States  *. 

Burma 

Ceylon 

Federation  of  Malaya 

Hong  Kong 

India.. 

Indonesia 

Iran 

Iraq 

Israel 

Japan 

Korea,  Republic  of 

Lebanon 

Outer  Mongolia 

Pakistan 

Philippines,  Republic  of 

the 

Syria  (United  Arab  Re- 
public, Syria  Region) «. . 

Taiwan.. 

Thailand 

Other 

Total  Asia 

Oceania: 

Australia 

New  Zealand 

Other 

Total  Oceania 

Africa: 

Algeria 

Angola » 

British  East  Africa  ' 

Congo,  Republic  of  the  '.  - 
Egypt  (United  Arab  Re- 
public, Egypt  Region).. 

Ghana 

Madeira  Islands  (Portu- 
guese)._ 

Malagasy  Republic » 

Morocco 

Rhodesia  and  Nyasaland, 

The  Federation  of 

Sudan 

Tunisia 

Union  of  South  Africa 

Western    Equatorial 

Africa  i» 

Other 

Total  Africa 

Grand  total 


$233, 337, 027 

289, 396 

1,339,826 

560,024 

65,329,163 

131,841,238 

71,591,079 

31,600,942 

25,711,417 

20,877,975 

744,517,664 

2, 224, 801 

790, 069 

3,721,203 

6, 323, 101 

169,235,911 

939, 314 
7, 860, 471 
1,443,522 

4, 753,  757 


$175,568,619 

641,254 

2,047,939 

1,291,003 

123,  752, 225 

157,075,949 

44, 847, 274 

36,801,498 

20, 370, 270 

23, 453, 613 

1,044,399,230 

3, 435, 393 

1,259,827 

3,  726, 161 

8, 288, 190 

198, 166, 390 

1,117,725 

13,967,452 

2, 594, 860 

4,461,404 


$11,281,459 

83, 044 

118, 352 

82, 361 

14, 895, 730 

6, 512, 228 

3,017,837 

2,656,512 

1,558,909 

2, 222, 326 

165, 270, 475 

586, 058 

97, 575 

462,969 

307, 037 

1,414,830 

159, 564 

1, 246, 767 

198, 048 

597, 623 


$8, 638, 489 

131,200 

141,311 

98, 251 

28,581,305 

10, 249,  582 

2,487,978 

3, 104, 199 

1,341,791 

2,631,629 

211,970,131 

569, 313 

199, 655 

304, 672 

539, 440 

11,214,378 

144, 346 

2, 106, 107 

436,978 

770, 567 


24.8 
121.6 
52.9 
130.5 
89.4 
19.1 

-37.4 
16.5 

-20.8 
12.3 
40.3 
54.4 
59.5 
.1 
31.1 

17.1 

19.0 
77.7 
79.8 
12.8 


1,524,287,900 


1,867,266,276 


212, 769, 704 


285,661,322 


22.5 


100, 375, 705 
78, 559, 847 
1,071,924 


145,415,277 

73,447,016 

976, 218 


15,125,376 

9,226,456 

50, 465 


18,833,216 

8, 328, 026 

81, 764 


44.9 
-6.5 


180,007,476 


219, 838,  511 


24, 402, 297 


27,243,006 


577, 027 

2, 460,  593 

3, 378, 631 

16, 864, 562 

14,302,539 
16,467,943 

2, 729,  760 
7,946,800 
4, 479, 823 

4,  205, 352 
3, 827, 407 
3, 899, 682 
43, 038, 464 

1,990,703 
4, 185, 568 


411,705 

1,467,599 

4,313,937 

20,  709, 711 

16, 598, 700 
14,443,964 

3, 089, 049 
9,692,989 
5, 644, 282 

16,  530, 316 

4, 060, 739 

762,987 

53, 782, 023 

1,837,797 
6,461,355 


83, 325 
196, 824 
151,945 
978, 406 

1,560,600 
689, 452 

1,250,549 
134, 300 
524, 242 

335, 489 

133,847 

539, 064 

7, 134, 685 

347, 489 
299, 257 


34, 389 

116,176 

176,921 

1,244,322 

1,797,150 
573, 278 

1,457,054 
156,424 
638, 171 

974, 259 

131,022 

108, 691 

8,171,865 

314,076 
419, 710 


-28.7 

-40.4 

27.7 

22.8 

16.1 
-12.3 

13.2 
22.0 
26.0 

293.1 
6.1 

-80.4 
25.0 

-7.7 
54.4 


130, 354, 854 


159,807,153 


14, 359, 474 


16,313,508 


8, 283, 772, 149 


9,409,414,923 


934, 536, 494 


1,124,973,785 


23.4 
58.0 
19.4 
19.3 
91.9 
57.4 

-17.6 
16.9 

-13.9 
18.4 
28.3 
-2.9 
104.6 

-34.2 
75.7 

692.6 

-9.5 
68.9 

120.6 
19.1 


34.3 


24.5 
-9.7 
62.0 


11.6 


-58.7 

-41.0 

16.4 

27.2 

15.2 
-16.9 

16.5 
16.5 
21.7 

190.4 

-2.1 

-79.8 

14.5 

-9.5 
40.3 


13.6 


20.4 


•  Includes  Newfoundland  and  Labrador. 

'  Includes  Western  Sectors  of  Berhn  and  the  Saar. 

s  Ireland  except  the  six  counties  of  Northern  Ireland  (Londonderry,  Antrim,  Tyrone,  Down,  Armagh, 
and  Fermanagh),  included  in  the  United  Kingdom. 

♦  Includes:  Kuwait;  Saudi  Arabia;  Peninsula  States  (Yemen,  Sultanate  of  Oman,  Trucial  Sheilths,  and 
Qatar);  Aden  (Islands  of  Perim,  Kamaran,  Soliotra,  and  Kuria  Muria;  and  the  Aden  Protectorate  with 
the  Hadhramaut);  and  the  State  of  Bahrein. 

i  Includes  Latakia. 

« Includes  Kabinda  (Cabinda). 

'  Includes  Kenya  Colony  and  Protectorate;  Uganda  Protectorate;  Zanzibar  Protectorate  (including 
Pemba);  and  Tanganyika. 

'  Includes  Ruanda-Urundi. 

'  Formerly  Madagascar  and  dependencies.  Includes  the  islands  of  Mayotte,  Ste.  Marie,  the  Glorious 
Islands,  Nosy-Ee  (Nossi-Be),  Bassas  de  India;  the  Comoro  Islands;  Reunion;  and  St.  Paul,  Amsterdam, 
and  the  Kerguelen  Islands. 

w  Includes  Gabon,  Congo,  Ubangi  Shari,  and  Chad. 


708   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  101. — Vehicles  and  persons  entering  the  United  States,  fiscal  years  1960  and 

1961 


Kind  of  entrant 


Percentage 
increase,  or 
decrease  ( — ) 


Vehicles: 

Automobiles  and  buses 

Documented  vessels 

Undocumented  vessels.. 

Ferries 

Passenger  trains 

Freight  cars 

Aircraft 

Other  vehicles 

Total  vehicles 

Passengers  by: 

Automobiles  and  buses 

Documented  vessels 

Undocumented  vessels 

Ferries 

Passenger  trains 

Aircraft 

Other  vehicles 

Pedestrians 

Total  passengers  and  pedestrians  > 


40,514,728 

53,  326 

36,  287 

121,273 

15,831 

2, 135.  602 

167,  029 

576,  606 


42, 340, 393 
48. 364 
37, 235 
107, 883 
14,549 
1, 873,  822 
162,046 
591,505 


43,  620,  682 


45, 175,  797 


110,326,962 

773. 342 

216,196 

1, 992.  768 

997,  053 

3,  740,  956 

4,000,911 

27,594,719 


119,102,103 

804,  956 

222,519 

1,643,445 

91.5,601 

4,  079.  965 

4.  .585,  837 

27,031,616 


149,  642,  907 


158,386,042 


4.5 

-9.3 

2.6 

-11.0 

-8.1 

-12.3 

-3.0 

2.6 


3.6 


8.0 

4.1 
2.9 
-17.5 
-8.2 
9.1 
14.6 
-2.0 


5.8 


1  Excludes  Puerto  Rico  and  Virgin  Islands. 


Table  102. — Aircraft  and  aircraft  passengers  entering  the  United  States,  fiscal  years 

1960  and  1961 


District 

Aircraft 

Aircraft  passengers 

Percentage  increase, 
or  decrease  (— ) 

1960 

1961 

1960 

1961 

Aircraft 

Passengers 

2,034 
1,855 

362 
9,194 
1,479 

971 
3,551 
23,  852 
7,725 
1,728 
1,718 

341 
2,843 

428 
38. 381 
2,  325 
1,245 
7,019 
1,  545 
3,107 
3, 903 
3.813 
2,254 
7,988 
3,193 
8,592 
1,868 
2,777 

709 
3,936 
4,811 
4,981 
4,  546 

224 
1,731 

2,254 
1,494 
428 
9,597 
2,013 
1,149 
2,982 

22,  232 
7,057 
1,724 
1,453 
298 
2,544 
467 

35, 353 
1,680 
1,165 
7,813 
1,5.52 
3,823 
3,519 
3,807 
2,490 
8,058 
3,115 
8,340 
2,121 
2,175 
514 
4,454 
4,741 
4,948 
4,  829 
442 
1,415 

8,834 

309, 299 

2,660 

83,  593 

5,041 

11,422 

365,  578 

1, 037, 395 

205, 304 

27. 325 

36,344 

5,  438 

60,  056 

4,548 

657. 195 

55. 843 

31,017 

62,  080 

4,111 

9,533 

8,041 

97,189 

'29,310 

120, 182 

60,  003 

261,  691 

20.  780 

23,  505 

14.398 

10,100 

26,  698 

58,  702 

28,860 

3,059 

5,822 

7,901 

297,  359 

2.339 

82, 057 

9,544 

13, 129 

393,  660 

1,  267,  634 

233, 478 

25, 869 

28,988 

5,242 

56, 637 

4,770 

638, 127 

47,713 

28,680 

64, 41 7 

4,381 

12, 379 

7,273 

119,806 

27,  340 

140,382 

66,150 

268, 359 

19.  647 

16,813 

15,481 

11,608 

27,683 

92,610 

30, 436 

4,880 

7,193 

10.8 

-19.5 

18.2 

4.4 

36.1 

18.3 

-16.0 

-6.8 

-8.6 

-0.2 

-15.4 

-12.6 

-10.5 

9.1 

-7.9 

-27.7 

-6.4 

11.3 

0.5 

23.0 

-9.8 

-0.2 

10.5 

0.9 

-2.4 

-2.9 

13.5 

-21.7 

-27.5 

13.2 

-1.5 

-0.7 

6.2 

97.3 

-18.3 

-10.6 

-3.9 

-12.1 

—1.8 

89.3 

14.9 

Buffalo                       -  .--  

7.7 

22.2 

13.7 

-5.3 

-20.2 

-3.6 

-5.7 

4.9 

Florida             .  .  

-2.9 

-14.6 

-7.5 

3.8 

El  Paso                     

6.6 

30.0 

-9.6 

23.3 

-6.7 

16.8 

32.3 

2.5 

-5.5 

-28.5 

7.5 

14.9 

3.7 

57.8 

Ohio    

5.5 

59.5 

Other                          - 

23.5 

Total               -- 

167,029 

162, 046 

3,  740, 956 

4, 079, 965 

-3.0 

9.1 

■  Revised. 


TABLES  709 

Table   103. — Seizures  for  violations  of  customs  laws,  fiscal  years  1960  and  1961  i 


1960  total 

1961 

Seizures 

Sei'.ures 

by 
Customs 

Seizures 
by  other 
agencies 

Joint  sei- 
zures by 
Customs 
and  other 
agencies 

Total 

Automobiles: 

Number --  _      

515 
$498, 879 

81 
$426, 705 

1 
$6, 722 

22 
$1,  372,  800 

32 

$3,  075,  605 

1,017 
$134,  992 

5,448 

16,  36d 

$328, 026 

2,  554 
$97, 982 

4,931 

$35,  719 

199, 399 

10,  875 

22,  207 

488,  470 

10,  539 

12,413 

294,  441 

329,  492 

1, 332, 013 

401 
$365,  510 

74 
$251, 050 

129 

$140,  991 

14 
$23, 563 

36 
$29, 163 

2 

$835 

566 
$535, 664 

90 

$275, 445 

Value -  --- 

Trucks: 

Number -_- 

Value 

KailroiJ  cars: 

Number 

Value ._ 

Aircraft: 

Number 

7 
$93,  500 

32 
$9. 116,  860 

1,091 
$116,214 

5,403 

36,  8% 

$688,  310 

3,002 
$183, 902 

4,639 

$5,  441 

190,  516 

15,  543 

66, 130 

681,  692 

9,579 

59,  876 

52,  713 

774, 041 

2,  721, 264 

7 
$93, 500 

34 

Value. 

Boats: 

Number 

2 

$18,  267 

8 
$1,  852 

55 

91 

$1,  714 

12 
$1, 191 

112 

Value 

$9, 135, 127 

1,161 
$128,  765 

5,590 

37, 029 

$694, 003 

3,076 
$185,  971 

4,831 

$5,  441 

191,  773 

16,  777 

Narcotics: 
Number  . 

62 
$10, 699 

132 

132 

$3,  979 

62 

$878 

80 

Value . 

Liquors: 

Number ... 

Gallons 

Value  ..     . 

Prohibited  articles  (obscene,  lottery,  etc.): 
Number _..  

Value . 

Other  seimres: 

Number 

Value: 

Cameras 

Edibles  and  farm  products 

Furs— skins  and  manufactui-es 

$1,  202 
1,234 
1, 047 

12,  589 
712 

$55 

Guns  and  ammunition. 

477 
624 
166 

57,  654 

694,  905 

10, 4i)7 

59  876 

Jewelry,  including  gems 

Livestock 

Tobacco  and  manufactures 

Watches  and  parts .. 

15 

143 

214, 176 

81 

300 

2,827 

52,  809 

774, 484 

2. 938,  267 

Wearing  apparel 

Miscellaneous .. 

Total  value  of  other  seizures 

2,  735,  568 

4,  666,  795 

231, 118 

4,530 

4,  802, 443 

Grand  total: 
'Number^. 

13  950 

M  IS"; 

187 
$418,  693 

336 

$50, 084 

14,658 
$15,  850,  918 

Value .... 

$8,677,279    .tl  .■;  .^S5!' 1 41   1 

'       '         1 

1  Includes  Puerto  Rico  and  the  Virgin  Islands. 

2  E.\cludes  number  of  carriers  seized  in  connection  with  seizures  of  liquor,  narcotics,  etc. 


710        1961    REPORT    OF    THE    SECRETARY    OF    THE    TREASURY 
Table   104. — Investigative  activities,  fiscal  years  1960  and  1961 


Activity 


1960 


1961 


Percentage 
increase,  or 
decrease  (— ) 


Investigations  of  violations  of  customs  laws: 

Undervaluations  and  false  invoicing,  irregular  entries 

Marking  of  merchandise 

Baggage  declaration  violations. - 

Smuggling: 

Diamonds  or  jewelry 

Narcotics - 

Other.. 

Touring  permit  violations 

Navigation,  aircraft,  and  vehicle  violations. 

Prohibited  importations  (19  U.S.C.  1305) 

Other  investigations: 

Customs  procedures 

Drawback - 

Classification  and  market  value 

Customs  brokers,  license  applications. 

Petitions  for  relief  from  additional  duties.. 

Character  investigations  of  applicants 

Pilferages  and  shortages 

Export  control  violations. 

Examination  of  customs  brokers'  records 

Miscellaneous - - 

Total... 


2,080 
157 
613 

369 

5,281 

1,331 

13 

1,383 

160 

128 
953 
509 
135 
795 
710 
532 
602 
270 
1,696 


17,717 


1,636 

145 


445 

5,450 

1,797 

14 

1,326 

149 

111 

1,000 

367 

163 

924 

1,092 

527 

707 

287 

1,990 


18, 828 


-21.3 
-7.6 
13.9 

20.6 
3.2 
35.0 
7.7 
-4.1 
-6.9 

-13.3 

4.9 

-27.9 

20.7 

16.2 

53.8 

-0.9 

17.4 

6.3 

17.3 


6.3 


'  Revised. 


Engraving  and  Printing  Production 

Table  105. — New  -postage  stamp  issues  delivered,  fiscal  year  1961 


Issue 


Denomina- 
tion (cents) 


Commemorati  ves : 

Emplov  the  Physically  Handicapped 

Fifth  World  Forestry  Congress 

Ignacy  Jan  Faderewski,  Champion  of  Liberty 

American  Credo,  Francis  Scott  Key 

Mexican  Independence 

United  States-.Tapan  Centennial 

Boys'  Clubs  of  America 

.'Abraham  Lincoln  Credo  of  America 

Patrick  Henry  Credo  of  America 

Project  Echo,  Communications  for  Peace 

Dulles  Memorial 

George  Memorial — 

Camp  Fire  Girls --- 

Champion  of  Liberty,  Giuseppe  Garibaldi 

Champion  of  Liberty,  Gustaf  Mannerheim... 
Champion  of  Liberty,  Giuseppe  Garibaldi  — 
Champion  of  Liberty,  Gustaf  Mannerheim... 

The  First  Automated  Post  Offlce 

Andrew  Carnegie,  Famous  American 

Mahatma  Gandhi,  Champion  of  Liberty 

Mahatma  Gandhi,  Champion  of  Liberty 

Range  Conservation 

Horace  Greelev,  Famous  American 

Fort  Sumter,  Civil  War  Centennial 

Knnsas  Statehood  Centennial 

George  W.  Norris — ..- 

U.S.  air  mail  (Red) 

U.S.  air  mail. - 

U.S.  air  mail - 

U.S.  ordinary 

U.S.  ordinary — precanceled  coils 


4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
4 
8 
8 
4 
4 
4 
8 
4 
4 
4 
4 
4 
7 
15 
13 
11 


TABLES 


711 


Table  106. — Deliveries  of  finished  work  by  the  Bureau  of  Engraving  and  Printing, 
fiscal  years  1960  and  1961 


Class  of  printed  work 


Number  of  pieces 


1960 


1961 


Face  value  1961 


Currency: 

United  States  notes 

Silver  certificates 

Federal  Reserve  notes. 


36, 000, 000 

1, 153, 484, 000 

591,648,000 


28, 720, 000 

1, 046, 812, 000 

540, 720, 000 


Total. 


1,  781, 132, 000 


1, 616, 252, 000 


Bonds,  notes,  bills,  certificates,  and  debentures: 
Bonds: 

Panama  Canal,  registered 

Treasury 

District  of  Columbia  Armory  Board  stadium. 

Depositary,  act  of  Sept.  24,  1917 

U.S.  savings,  registered 

Consolidated    Federal    Farm   Loan   for   the 
twelve  Federal  intermediate  credit  banks.. 
Notes: 

Treasury 

Special,  United  States  International  Mone- 
tary Fund 

Special,  United  States  Inter-American  Devel- 
opment Bank  Series 

Special,  International  Development  Associa- 
tion Series 

Consolidated  of  the  Federal  home  loan  banks  . 
Bills: 

Treasury 

Certificates: 

Treasury  certificates  of  indebtedness 

Debentures: 

Consolidated  collateral  trust  for: 

Twelve  Federal  intermediate  credit  banks. 

Thirteen  banks  for  cooperatives 

Federal  National  Mortgage  Association  sec- 
ondary market  operations 

Federal  Housing  Administration 


350 
442, 125 


218 
1, 438, 001 

188,  376 

2, 330, 893 

200 

101 


950 

1,113,844 

20, 202 

550 
1, 578, 000 

133, 920 

523, 765 


83, 120 

2, 086, 500 

409, 114 


91, 142 
29, 532 


149,  789 
47,  650 


131 
61,  780 


2,  404, 000 
288, 561 


103, 455 
29, 000 


71,  732 
70, 365 


Total. 


7,297,111 


6, 400, 255 


Stamps: 

Customs 

Internal  Revenue: 

To  offices  of  issue 

To  Smithsonian  Institution 

Puerto  Rican  revenue 

Virgin  Islands  revenue 

U.S.  postage: 

Ordinary 

Air  mail 

Commemoratives 

Special  delivery 

Postage  due 

Canal  Zone  postage: 

Ordinary 

Air  mail 

Commemoratives 

Postage  due 

U.S.  savings  stamps 

District  of  Columbia  beverage  tax  paid. 

Federal  migratory  bird  hunting 

Federal  motor  boat  stamp 

Food  stamp  coupons 

Specimen 


14, 431, 404 

,  735, 304, 721 

1,331,924 

158,148,425 


20, 156, 429, 200 

908, 864,  000 

2,  492,  757, 000 

31,  720, 000 

186,  370, 000 

1.130,000 

940, 000 

1,155.000 

120, 000 

106,  503, 000 

41,705,000 

5, 067, 000 

4, 889, 800 


10, 818,  604 

1, 771,  544, 467 

116, 700 

180, 800, 925 

54, 500 

18, 864, 852, 200 

916,111,400 

3, 032, 289,  800 

34,  265, 000 

154, 290, 000 

3,  585, 000 
3, 950, 000 


96, 379,  500 

34,  450, 000 

5, 214, 000 


7,  979, 750 
336 


Total. 


25, 846, 866, 474 


25, 116,  702, 182 


Miscellaneous,  checks,  certificates,  etc. 

To  offices  of  issue 

To  Smithsonian  Institution 


8, 131, 941 
1,406 


6, 872,  713 


Total 

Grand  total. 


8, 133, 347 


6, 872,  713 


27,  643, 428, 932 


26, 746, 227, 150 


$134, 960, 000 
1, 386,  652, 000 
6, 322, 200, 000 


7,843,812,000 


7, 700, 000 

30, 485, 644, 500 

20, 202, 000 


941, 125, 000 

1,511,570,000 

33, 471,  568, 000 


301,000,000 
1, 260, 200, 000 


180,  675, 000, 000 
21,480,002,000 


2,350,000,000 
825,000,000 


992, 250, 000 
232,885,000 


274, 554, 146, 500 


119, 718, 709 
347, 658 


836, 103, 446 
74,081,298 

127,  696,  684 
10, 279,  500 
15, 024,  350 

140, 650 
292, 900 


16, 062,  500 
1,121,490 
15,642,000 


6,  457, 250 


1, 222,  968, 435 


283, 620,  926, 935 


712   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


CQ 


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42,034,794.41 

19, 209, 325. 22 
102,571.315.95 

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Balance  Due 

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Agreement  of  August  10, 1922 

Agreement  of  December  31,  1928. 
Private  Law  No.  509.. 

Interest  to  January  1, 1928: 

Agreement  of  August  10,  1922 

Agreement  of  December  31,  1928. 

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through  June  30, 1961 

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Agreement  of  December  31,  1928- 
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714   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  108. — Mexican  claims  fund  as  of  June  SO,  1961 

[This  special  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  Dec.  18, 1942,  as  amended 
(22  U.S.C.  667).    For  further  details,  see  annual  report  of  the  Secretary  for  1943,  p.  189] 


Status  of  the  fund 


Amount 


Receipts: 

Payments  from  the  Government  of  Mexico: 

Agrarian  claims  agreement  of  1938-.. 

Expropriation  agreement  of  1941: 

Initial  payment  on  ratification  of  agreement 

Annual  installments  through  November  1955 

Appropriation  by  the  U.S.  Government  covering  amount  of  awards  and  appraisals  on 
behalf  of  Mexican  nationals 


Total  receipts. 


Expenditures: 

Amounts  paid  to  American  nationals: 
Fiscal  years: 

1943-1960 

1961 


Total  expenditures 

Undisbursed  balance  June  30,  1961... 

Claims  certified  for  payment: 

By  the  Secretary  of  State  in  accordance  with: 

Decisions  rendered  by  the  General  Claims  Commission. 

Appraisals  approved  under  the  general  claims  protocol  between  the  United  States 

and  Mexico,  signed  April  24,  1934 

By  the  American  Mexican  Claims  Commission: 

Decisions  under  the  provisions  of  the  Settlement  of  Mexican  Claims  Act  of  1942.. 


Total  claims  certified. 


$3, 000, 000. 00 

3, 000,  000.  00 
34, 000, 000. 00 

533,  658. 95 


40,  533,  658. 95 


40, 380,  562. 23 
5, 587. 27 


40, 386, 149. 50 


147,  509.  45 


201,  461. 08 
2,  599, 166. 10 
37,  948, 200. 05 


40, 748, 827. 23 


Note.— The  final  distribution  of  awards  was  authorized  during  fiscal  1956  and  payments  were  made 
during  fiscal  1957.  Since  then  amounts  have  been  paid  to  those  individuals  who  had  not  previously  sub- 
mitted appropriate  vouchers  or  sufficient  proof  of  their  claims. 


Table  109. —  Yugoslav  claims  fund  as  of  June  30,  1961 

[This  special  fund  was  established  in  accordance  with  the  provisions  of  the  act  of  Mar.  10,  1950,  as 
amended  (22  U.S.C.  1627).    For  further  details  see  annual  report  of  the  Secretary  for  1954,  p.  Ill] 


Status  of  the  fund 

Amount 

Receipts: 

Payment  received  from  the  Government  of  Yugoslavia 
1948 

under  agreement  of  July  19, 

$17,000  000  00 

Expenditures: 

Amounts  paid  to  .American  nationals: 
Fiscal  years: 

1953-1960 

16,629  967.37 

1961 

499. 95 

Total  expenditures . 

16, 630, 467. 32 

Undisbursed  balance  .Tnne  .'lO,  IQfil 

369,532  68 

Claims  certified  for  payment  by  the: 

International  Claims  Commission  of  the  United  States  ' 

793, 596. 69 

Foreign  Claims  Settlement  Commission  of  the  United  States     .         -_-.__ 

18, 024, 308. 20 

Total  claims  certified 

18,817,904.89 

'  By  Reorganization  Plan  No.  1  of  1954,  the  name  of  this  Commission  was  changed  to  the  Foreign  Claims 
Settlement  Commission  of  the  United  States,  effective  July  1,  1954. 


TABLES 


715 


Table  110. — Status  of  claims  of  American  nationals  against  certain  foreign  govern- 
ments as  of  June  SO,  1961 


Bulgaria 

Hungary 

Rumania 

Italy 

U.S.S.R. 

Awards     certified     to     the 
Treasury: 
Number  of  awards 

231 

1,301 

565 

650 

1,979 

Amount  of  awards: 

Principal 

$4,684,186.46 
1,887,637.43 

$58,181,408.34 
22,114,638.98 

$60,011,347.78 
24,717,942.92 

$2,731,746.44 
929,630.03 

$70,446,019.13 
58, 592, 874. 21 

Interest  .  

Total 

6,571,823.89 

80,296,047.32 

84, 729, 290.  70 

3,661,376.47 

129, 038, 893. 34 

Deposits  in  claims  funds 

Statutory  deductions  for  ad- 
ministrative expenses 

2, 750,  869. 04 
137, 543. 45 

1, 423, 429.  72 
71,171.53 

21,112,662.79 
1,055,633.13 

5,000,000.00 
250,000.00 

9, 114, 444. 66 
455,722.23 

Amounts   available   for 
payment  on  awards.... 
Payments  on  awards: 

Principal 

2,613,325.59 
2, 664,  556. 92 

1,352,258.19 
1,130,382.93 

20,057,029.66 
20,047,629.87 

4, 750, 000. 00 

2,  726, 618.  54 
927, 166.  56 

8, 658,  722. 43 
8,631,844  82 

Interest 

Balances  in  claims  funds 

48, 768.  67 

221,875.26 

9,399.79 

1,096,214.90 

26,877.61 

614359—62- 


716   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Gold  and  Currency  Transactions  and  Holdings 

Table   111. —  United  States  net  monetary  gold  transactions  with  foreign  countries 
and  international  institutions,  fiscal  years  1945-61 

[In  millions  of  dollars  at  $35  per  ounce.    Negative  figures  represent  net  sales  by  the  United  States; 
positive  figures,  net  purchases] 


Country,  etc. 

1945-1956 

1957 

1958 

1959 

1960 

1961 

-4.5 

677.2 

-6.2 

-244. 1 

134.9 

18.8 

-25.4 

-0.6 
115.3 

-0.2 
55.2 

67.2 
-123.  5 
-120.7 
-210.2 

-140. 0 

-44.  5- 

Bank  for  International  Settlements 

-89.5 
-157.7 

—59  0 

6.8 

-50.8 

-90.1 

Brazil                                           

-3.8 

-12.0 

586.5 

19.8 

-7.5 
-1.3 

Chile      

22.2 

41.0 

-38.4 

-13.2 

2.1 

-120.8 

-18.1 

-9.0 

202.3 

-375. 6 

2.8 

28.1 

7.0 

3.0 

-8.6 

-6.3 

-17.0 

-5.0 

-10.0 

-50.0 

-7.5 

El  Salvador                            -  -  - 

-3.5 

6.4 

-4.7 
-265.  7 

-3.0 

-173.  0 

-56.3 

-5.6 

-45.2 

-15.0 
-2.4 
-6.0 

-47.0 

-75.0 
18.8 
97.3 

-2.6 

-5.0 

-24.9 

International  Monetary  Fund     

699.9 

-7.3 

1  -352.  6 

252.1 

300.0 

-29.8 

-1.1 
-114.3 

-4.4 

Italy          .           - 

-168.8 

-180.  0 
-125.0 

100.0 

-62.5 
-1.6 

-15.2 

-1.9 

Kuwait    --    

-9.8 

Laos - - - 

-1.9 

Footnotes  at  end  of  table. 


TABLES 


717 


Table  111. —  United  States  net  monetary  gold  transactions  with  foreign  countries 
and  international  institutions,  fiscal  years  1945-61 — Continued 

[In  millions  of  dollars  at  $35  per  ounce.    Negative  figures  represent  net  sales  by  the  United  States; 
positive  figures,  net  purchases] 


Country,  etc. 

1945-1956 

1957 

1958 

1959 

1960 

1961 

Lebanon 

-21.8 
64.9 

-20.0 

-10.0 

Morocco..- 

—21  0 

Netherlands.- 

-101.3 

19.9 

11.7 

-10.7 

25.0 

-104.8 

-186.  0 

-34.9 

214  4 

Nicaragua 

Norway 

Peru 

3.5 

21.9 

-20.0 

20  0 

Philippines 

11.9 
-10.0 

5.0 

Portugal 

-11.6 

-4.1 

1,121.3 

Saudi  Arabia.   

—35  0 

South  Africa 

Spain 

31.5 

31.7 
-2.5 

—171  5 

Surinam 

—2  5 

Sweden 

231.2 

-209.  4 

-10.4 

57.9 

947.2 

-40.1 

6.1 

-225.  9 

15.2 
-8.0 

-140. 1 

-75.1 

20.1 

-399. 1 

Syria 

Turkey 

—8  6 

United  Kingdom.. 

100.3 

29.1 

3.0 

-200.  0 

-750. 0 

3.1 

-1.5 

-350. 0 

-150.  0 

Uruguay 

—3  8 

Vatican  City 

-3.2 

1.0 
65.0 
-1.5 
-4.5 

7  0 

Venezuela 

Yugoslavia.. 

—15  9 

All  other       

-129.  7 

-.2 

-3.2 

-5.8 

6  3 

Total. 

2, 403.  5 

840.0 

-1, 346.  9 

-1, 660.  7 

-341.6 

1  730  4 

>  Includes  $343.8  million  payment  to  the  International  Monetary  Fund.  Pursuant  to  an  act  approved 
June  17, 1959  (22  U.S.C.  286e-l),  the  United  States  madepayment  of  its  increase  in  quota  to  the  International 
Monetary  Fund,  amounting  to  $1,375,000,000,  on  June  23, 1959.  The  payment  was  made  in  gold  in  amount 
of  $343,753,030.40,  and  in  nonnegotiable,  noainterest-bearing  notes  of  the  United  States  amounting  to  $1,031,- 
249,999.60  in  place  of  a  like  amount  of  currency. 


718   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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Is^i^^      ^.a   55  2-S5i 


720   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  113. —  United  States  gold  stock  and  holdings  of  convertible  foreign  currencies 
by  U.S.  monetary  authorities,  fiscal  years  1952-61 

[In  millions  of  dollars] 


End  of  fiscal  year  or  month 


Gold  stock 

Foreign 
currency 

Treasury 

Total  1 

holdings 

23, 346 

23,  533 
22,  521 
22, 027 
21, 730 
21, 868 
22,  732 
21,412 
19.  746 
19, 363 

17,  603 

19, 188 
19, 045 

18,  725 
18. 443 
17, 948 
17, 804 
17, 480 
17,412 
17, 433 
17, 435 
17,  451 
17, 603 

22, 463 

21, 927 

21,  678 

21,  799 

22,  623 

21, 356 

19, 705 

19,  322 

17,  550 
19, 144 

186 

19,  005 

18, 685 

18, 402 

17,910 

17,  767 

17,441 

17, 373 

17,  388 
17,  390 
17, 403 
17,  550 

25 
175 
165 
186 

1952 

1953 

1954 

1955.— — . 

1956 -. 

1957 -. 

1958 

1959 

1960 

1961 -. 

1960— July 

August 

September 
October.... 
November. 
December. 

1961— January... 
February.. 

March 

April 

May 

June 


1  Includes  gold  in  Exchange  Stabilization  Fund,  which  is  not  included  in  Treasury  gold  figures  shovra 
in  the  daily  Treasury  statement  or  in  the  Circulation  Statement  of  United  States  Money. 


TABLES 


721 


Table  114. 


-Assets  and  liabilities  of  the  exchange  stabilization  fund  as  of  June  SO, 
1960  and  1961 


Assets  and  liabilities 


June  30,  1960 


June  30,  1961 


Fiscal  year 
1961,  increase, 
or  decrease  (-) 


Assets 
Cash: 

Treasurer  of  the  United  States,  checking  accounts—. 
Federal  Reserve  Bank  of  New  York,  special  account. 

Total  cash 

Special  account  (No.  1)  of  the  Secretary  of  the  Treasury 
in  the  Federal  Reserve   Bank  of  New  York — gold 

(schedule  1) 

Foreign  exchange  due  from  foreign  banks: ' 

Central  Bank  of  Argentina 

Bank  of  England 

Deutsche  Bundesbank 

Swiss  National  Bank 

Investments  in  U.S.  Government  securities  (schedule  2). 

Accrued  interest  receivable  (schedule  2).. 

Accounts  receivable 

Unamortized  premium  on  U.S.  Government  secui'ities.. 
Office  equipment  and  fixtures,  less  allowance  for  depre- 
ciation  


$338, 449. 43 
203, 814,  653. 98 


$745, 020. 70 
111,866,950.15 


$406,  571. 27 
-91,  947,  703. 83 


204, 153, 103. 41 

40, 383,  713.  74 
25,000,000.00 


60, 000, 000. 00 

321,111.28 

207,  523.  55 

15,  670.  52 

18, 322. 85 


112,611,970.85 


52, 810, 064. 16 

14, 000, 000. 00 

25,399,951.81 

20, 132, 000.  22 

64,  999,  028,  28 

46, 000. 000.  00 

306,  291.  55 

91,356.15 

1, 943. 28 

20, 482. 93 


-91, 541, 132. 56 


12, 426, 350. 42 

-11,000,000.00 

25,399,951.81 

20, 132, 000. 22 

64, 999, 028. 28 

-14,000,000.00 

-14,819.73 

-176,167.40 

-13,727.24 

2,160.08 


Total  assets. 


330, 159, 445.  35 


336, 373, 089. 23 


6, 213,  643. 88 


LlABIUTIES  AND  CAPITAL  2 

Liabilities: 

Vouchers  payable 

Employees'  payroll  allotment  account,  U.S.  savings 

bonds 

Accounts  payable 

Unamortized  discoimt  on  U.S.  Government  securi- 
ties  


11, 232. 62 


2,  784. 24 
142,114.38 


31,038.10 


162, 719. 11 


2,  682.  47 
231, 052. 33 


9,  605.  58 


151, 486. 49 


-101.77 
38, 937. 95 


-21, 432.  52 


Total  liabilities. 


187, 169. 34 


406, 059. 49 


218, 890. 15 


Capital: 

Capital  account 

Cumulative  net  income  (schedule  3). 


200, 000. 000. 00 
129, 972, 276. 01 


200, 000, 000. 00 
135, 967, 029.  74 


5, 994,  753. 73 


Total  capital 

Total  liabilities  and  capitaL 


329, 972, 276. 01 


335, 967, 029.  74 


5, 994,  753.  73 


330, 159, 445. 35 


336, 373, 089. 23 


6, 213, 643. 88 


>  For  foreign  exchange  future  contracts,  see  schedule  4. 

'  For  contingent  liabilities  under  outstanding  stabilization  agreements,  see  schedule  5. 


722   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  114. — Assets  and  liabilities  of  the  exchange  stabilization  fund  as  of  June  30, 
1960  and  1961 — Continued 

SCHEDULE  1.— SPECIAL  ACCOUNT  OF  THE  SECRETARY  OF  THE  TREASURY  IN  THE 
FEDERAL  RESERVE  BANK  OF  NEW  YORK 


Location  of  gold 

June  30, 1960 

June  30, 1961 

Ounces 

Dollars 

Ounces 

Dollars 

Federal  Reserve  Bank  of  New  York 

U.S.  Assay  Office,  New  York. 

1, 007,  200.  215 
146,  620. 099 

$35,  252, 007.  39 
5, 131,  706. 35 

1,  354,  295.  657 
154,  563. 189 

$47, 400,  348. 03 
5, 409,  716. 13 

Total  gold 

1,153,820.314 

40, 383, 713. 74 

1,508,858.846 

52,810,064.16 

SCHEDULE    2.— INVESTMENTS    IN    UNITED    STATES    GOVERNMENT    SECURITIES, 

JUNE  30,  1961 


Securities 

Face  value 

Cost 

Average  price 

Accrued 
interest 

Public  issues: 

Treasury  notes: 

2H%,  Series  A-1963 

$16,000,000 

5, 000, 000 

2,  200,  000 

400,  000 

10,  000,  000 
2,  400,  000 

10, 000,  000 

$16,  005, 625.  00 

4,976,562.50 

2, 199,  625. 00 

399, 875.  00 

10,  000,  000.  00 
2,  398, 843.  75 

10,  000,  000. 00 

100. 03515 

99.  53125 
99. 98295 
99. 96875 

100. 00000 
99. 95182 

100. 00000 

$156, 629. 84 
46,  616.  01 

Treasury  bonds: 

2)^%  of  1963 

2}.^%  of  1964-69  (dated  Apr.  15, 1943). 
21.^%  of  1964-69  (dated  Sept.  15, 1943). 
2!-^%  of  1965-70 

2,  254. 10 

409. 83 

72,  690.  22 

2W7o  of  1966-71 

17, 445.  65 
10, 245. 90 

21.^%  Of  1967-72  (dated  Nov.  15, 1945). 

Total  investments 

46, 000, 000 

45,980,531.25 

306,  291.  55 

SCHEDULE  3.— INCOME  AND  EXPENSE 


Source 


Jan.  31, 1934,  through- 


June  30,  I960 


June  30,  1961 


Earnings: 

Profits  on  British  sterling  transactions 

Profits  on  French  franc  transactions 

Profits  on  gold  bullion  (including  profits  from  handling  charges 

on  gold) 

Profits  on  gold  and  exchange  transactions. , 

Profits  on  silver  transactions 

Profits  on  sale  of  silver  bullion  to  Treasury 

Profits  on  investments ., 

Interest  on  investments 

Miscellaneous  profits... 

Interest  earned  on  foreign  balances 

Interest  earned  on  Chinese  yuan 

Total  earnings 

Expense: 

Personnel  compensation  and  benefits 

Travel 

Transportation  of  things 

Rent,  communications,  and  utilities 

Supplies  and  materials 

Other 

Total  expense 

Cumulative  net  income.. 


$310, 638. 09 
351,  527. 60 


70, 630, 

51,  474, 

102, 

3, 473, 

2, 478, 

20, 338, 

867, 

3, 359, 

1, 975, 


725.  75 
262.  57 
735. 27 
362.  29 

947. 81 

595. 82 
754.  27 
602. 16 
317. 07 


155, 363, 368. 70 


19,  575,  567. 18 
1, 028, 483.  56 

1,  378, 141. 03 
693, 826.  06 
157, 955. 42 

2,  557, 119.  44 


25,391,092.69 


129, 972,  276. 01 


$310,  638.  09 
351,  527. 60 


76, 876, 
51,  776, 
102, 
3, 473, 
2,  554, 
21,  709, 
1, 034, 
4, 179, 
1, 975, 


717. 99 
574.  21 
735. 27 
362.  29 
630.63 
798. 70 
901. 27 
817. 45 
317.07 


164, 346, 020.  57 


21, 591, 018. 59 

1, 185, 379. 47 

1, 846, 797. 63 

728,  455. 88 

168,  547. 36 

2, 858,  791. 90 


28, 378, 990. 83 


135, 967, 029. 74 


TABLES 


723 


Table  114. 


-Assets  and  liabilities  of  the  exchange  stabilization  fund  as  of  June  SO, 
1960  and  1961— Continued 


SCHEDULE    4.— FOREIGN    EXCHANGE    TRANSACTIONS    FOR    FUTURE    DELIVERY 

JUNE  30,  1961 


Deutsche  Bundesbank 

Deutsche  marks 

Dollars 

Account  No.  1: 

Foreign  exchange  sales  contracted  for  future  delivery: 

10, 000, 000. 00 
94, 000,  000. 00 

$2,  513, 750. 00 

Forward  sales  .  

23,  762, 000. 00 

Less  deutsche  marks  on  hand 

104,000.000.00 
79, 928,  844.  60 

26, 275, 750. 00 
20, 132,  000.  22 

Foreign  exchange  due  on  future  deliveries . 

24, 071, 155. 40 

6, 143, 749. 78 

Account  No.  2: 

Foreign  exchange  sales  contracted  for  future'delivery— special — 
Foreign  exchange  purchased  for  future  delivery — special. 

965,  600, 000. 00 
965,  600,  000. 00 

244,  070, 827. 50 
244, 070, 827. 50 

SCHEDULE.5.— CURRENT  UNITED  STATES  STABILIZATION  AGREEMENTS, 

JUNE  30,  1961 


Country 


Amount 


Argentina: 

Original  agreement  dated  January  1, 1959 - 

Renewed  January  1, 1961. 
Expires  December  31, 1961. 
$25,000,000  advanced  under  original  agreement  (1959)  of  which  $11,000,000  has 
been  repaid. 
ChUe: 

Original  agreement  dated  February  10, 1961 - 

Expires  February  9, 1962. 
No  advances  made. 
Brazil: 

Original  agreement  dated  May  16, 1961 

Expires  May  15, 1963. 
No  advances  made. 
Mexico: 

Original  agreement  dated  January  1, 1958 - — 

Renewed  January  1, 1960. 
Expires  December  31, 1961. 
No  advances  made. 


$50,  000,  000 

15,  000, 000 
70, 000,  000 
75,  000,  000 


724   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 

Table  115. — Summary  of  receipts,  withdrawals,  and  balances  of  foreign  currencies 
acquired  by  the  United  States  without  purchase  with  dollars,  fiscal  year  1961 

[In  U.S.  dollar  equivalent '] 

Balance  held  by  Treasury  Department,  July  1,  1960 =  $1, 035, 180, 514. 94 

Collections: 

Development  Loan  Pund,  section  204,  Mutual  Security  Act  of 

1954,  as  amended  (22  U.S.C.  1874) $22,611,644.91 

Sale  of  surplus  agricultural  commodities  pursuant  to: 

Section  402,  Mutual  Security  Act  of  1954  (22  U.S.C.  1922)...    160,  579,  783. 34 
Title  I,  Public  Law  480,  .Agricultural  Trade  Development 

and  Assistance  Act  of  1954,  as  amended  (7  U.S.C.  1704-5)..    990,637,447.62 
Commodity  Credit  Corporation  Charter  Act   (15  U.S.C. 

713a) 25,374.61 

Loans  and  other  assistance: 

Section  505(a),  Mutual  Security  Act  of  1954,  as  amended  (22 

US.C.  1757)... 37,044.33 

Section  505(b),  Mutual  Security  Act,  as  amended  (22  U.S.C. 

1757)  principal  and  interest  on  loans 13,  963, 417.  84 

Informational  media  guaranties  (22  U.S.C.  1442): 

Principal.. 4,165,659.26 

Interest 23,  584.  74 

Lend-lease  and  surplus  property  agreements  (50  App.  U.S.C. 

1641) 21,620,915.14 

Bilateral  agreements  5%  and  10%  counterpart  funds,  (22  U.S.C. 

1852(b)) 29,615,702,00 

Foreign  programs  to  be  held  in  trust 24,  321.  826.  21 

President's  special  international  program  (22  U.S.C.  1990) 39,  718.  62 

All  other  sources. 59, 902,  585.  82 

Total  collections 1,327,544,704.44 

Total  available 2,362,725,219.38 

Withdrawals: 

Sold  for  dollars,  proceeds  credited  to:  3 

Treasury  accounts  and  miscellaneous  receipts 110,  509, 212. 95 

Commodity  Credit  Corporation  capital  fund 98,  301,  377. 19 

United  States  Information  Agency 2,  665,  482.  24 

Development  Loan  Fund 3,  706, 944.  36 

Treasury  suspense  account 24,  900,  228.  36 

President's  special  international  program 39,  756.  35 

Total  sold  for  dollars 240, 123, 001  45 

Requisitioned  for  use  without  reimbursement  to  the  Treasury 
pursuant  to:  < 

Section  104,  Public  Law  480,  as  amended  (7  U.S.C.  1704) 552, 692,  977. 97 

Section  204,  Mutual  Security  Act,  as  amended  (22  U.S.C. 

1874) 151,729.31 

Section  402,  Mutual  Security  Act,  as  amended  (22  U.S.C. 
1922) 160,579,783.34 

Trust  agreements 24, 321, 826. 21 

Transfers  from  agency  foreign  transaction  accounts  to  Secre- 
tary o  f  th  e  Treasury  Public  Law  480  accounts 286,  868.  01 

Other  authority... —228, 677.  65 

Total  requisitioned  without  reimbursement 737, 804, 507. 19 

Total  withdrawals 977, 927,  .508.  64 

Adjustment  for  rate  differences —61,  404,  304. 25 

Balance  held  by  Treasury  Department,  June  30, 1961 1, 323,  393,  406. 49 

Footnotes  at  end  of  table. 


TABLES  725 

Table  115. — Summary  of  receipts,  withdrawals,  and  balances  of  foreign  currencies 
acquired  by  the  United  States  without  purchase  with  dollars,  fiscal  year  1961 — 
Continued 

Analysis  of  balance  held  by  Treasury  Department  June  30, 1961: 

Proceeds  for  credit  to  miscellaneous  receipts $127,  263,  595.  95 

Proceeds  for  credit  to  agency  accounts: 
Informational  media  guaranty  funds: 

Principal 2,899,376.26 

Interest  account 504, 633. 22 

Commodity  Credit  Corporation  capital  funds 244,635,756.04 

Development  Loan  Fund 27,875,408.45 

Held  in  suspense  for  identiflcatiou 4,863.26 

Held  in  trust 1,259,445.84 

For  program  use  under  sec.  103(c),  Mutual  Security  Act  of  1954, 

as  amended  (22  U.S. C.  1813) 7,924,913.15 

For  program  allocations: 

Section  104,  Title  I,  Public  Law  480,  as  amended 900,  593,  799.  37 

Section  505(a),  Mutual  Security  Act  of  1954,  as  amended 95,  847.  94 

Section  505(b),  Mutual  Security  Act  of  1954,  as  amended 10,335,767.01 

Total 5 1,323,393,406.49 

Balances  held  by  other  executive  agencies,  June  30, 1961,  for  purpose  of: 

Economic  and  technical  assistance  under  Mutual  Security  Act 178,963,357.41 

Programmed  uses  under  Agricultural  Trade  Development  and  Assistance  Act..  1,  059,  649,  783. 34 

Military  family  housing  in  foreign  countries 18,880,970.  53 

Trust  agreements  with  foreign  countries 8,732,048.98 

Other 643,310.93 

Balances  held  by  E.xport-Import  Bank  (to  be  deposited  in  Treasury): 

Interest  earned  on  bank  balances 418,479.54 

Interest  on  Cooley  loans  « 75,  711.  20 

Repayments  on  Cooley  loans  8 693,883.53 

Total 1,268,057,545.46 

Grand  total 2,  591, 450, 951. 95 


1  For  the  purpose  of  providing  a  common  denominator,  the  currencies  of  81  foreign  countries  are  herein 
stated  in  U.S.  dollar  equivalents.  It  should  not  be  assumed  that  dollars  in  amounts  equal  to  the  balances 
shown  are  actually  available.  The  dollar  equivalents  were  calculated  at  varying  rates  of  exchange.  Foreign 
currencies  generated  under  the  Public  Law  480  program,  comprise  more  than  74.6  percent  of  the  total,  and 
currencies  generated  under  certain  provisions  of  the  mutual  security  acts  were  converted  at  deposit  rates 
provided  for  in  the  international  agreements  with  the  respective  countries.  The  greater  portion  of  these 
currencies  is  available  to  agencies  without  reimbursement  pursuant  to  legislative  authority  and,  when 
disbursed  to  the  foreign  governments,  will  generally  be  accepted  by  them  at  the  deposit  or  collection  rates . 
Currencies  available  for  sale  for  dollars  and  certain  other  U.S.  uses  were  converted  at  market  rates  of  ex- 
change in  ellect  on  the  date  of  the  sale  and  market  rates  Ln  effect  at  the  end  of  the  month  for  transactions 
during  the  month,  these  market  rates  being  those  used  to  pay  U.S.  obligations.  The  closing  balances  were 
converted  at  the  June  30,  1961,  market  rates.  These  statements  do  not  include  the  participating  country- 
owned  foreign  currencies  equivalent  of  $406,672,216.60,  which  are  reported  by  the  International  Cooperation 
Administration.  These  currencies  are  under  joint  control  of  the  International  Cooperation  Administration 
and  the  foreign  goverimients  involved. 

2  The  difference  of  $68.00  between  the  June  30, 1960,  closing  balance  and  the  July  1, 1960,  opening  balance 
results  from  the  fiscal  year  1960  balances  being  rounded  while  the  fiscal  year  1961  balances  were  reported  in 
full  amounts. 

3  Dollars  acquired  from  the  sale  of  foreign  currencies  are  derived  from  charges  against  the  doUar  appropria- 
tions of  the  Federal  agencies  whicli  use  the  currencies.  These  dollar  proceeds  are  credited  to  either  miscel- 
laneous receipts  or  other  appropriate  accounts  on  the  books  of  the  Treasury. 

4  Includes  advances  pursuant  to  the  cited  provisions  of  the  Agricultural  Trade  Development  and  Assist- 
ance Act  of  1954,  as  amended;  the  mutual  security  acts,  as  amended;  withdrawal  of  foreign  currency  held  in 
trust. 

'  Represents  the  dollar  value  of  currencies  held  in  the  accounts  of  the  Treasury  Department  only.  Cur- 
rencies transferred  to  agency  account?  pursuant  to  requisitions  submitted  to  the  Treasury  Department,  or 
as  otherwise  authorized,  are  accounted  for  by  the  U.S.  Government  agencies.  Balances  held  by  executive 
departments  and  agencies  as  of  June  30,  1961,  are  stated  at  end  of  summary. 

'  The  loans  were  made  by  the  Export-Import  Bank  under  section  104e  (Cooley  Amendment)  of  the  Agricul- 
tural Trade  Development  and  Assistance  Act  of  1954  (7  U.S.C.  1704(e)). 

NoTK.— For  detailed  data  on  collections  and  withdrawals  by  country  and  program,  see  Part  V  of  the 
Combined  Statement  of  Receipts,  Expenditures  and  Balances  for  the  fiscal  year  ended  June  SO,  1961. 


726 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  116. — Balances  of  foreign  currencies  acquired  by  the  United  States  without 
purchase  with  dollars,  June  SO,  1961 


Country 


Currency 


In  Treasury  accounts 


Foreign 
currency 


Dollar 
equivalent 


In  agency  accounts 


Foreign 
currency 


Dollar 
equivalent 


Afghanistan 

Afghanistan 

Argentina 

Australia 

Austria 

Belgium 

Bolivia 

Brazil 

Burma 

Cambodia 

Ceylon 

Chile 

China. 

Colombia 

Congo,  Republic 
of  the. 

Costa  Rica 

Cyprus _ 

Denmark 

Ecuador 

El  Salvador 

Ethiopia 

Finland 

France 

Germany,  Federal 

Republic  of. 
Germany,  East... 

Ghana 

Greece 

Guatemala 

Honduras 

Hong  Kong 

Hungary 

Iceland 

India..- 

Indonesia 

Iran 

Iraq 

Ireland 

Israel 

Italy 

Jamaica 

Japan 

Jordan.. 

Kenya 

Korea,  Repub- 
lic of. 
Laos 


Afghani 

Pakistan 
Rupee. 

Peso 

Pound 

Schilling 

Franc 

Boliviano 

Cruzeiro 

Kvat 

Riel 

Rupee 

Escudo 

N.T.  DoUar. 

Peso 

Franc 


Colon 

Pound 

Krone 

Sucre 

Colon.- 

E.  Dollar 

Markka 

New  Franc 

W.D.  Mark... 

E.D.  Mark... 

Pound 

Drachma 

Quetzal 

Lempira 

H.K.  Dollar... 

Forint 

Krona 

Rupee.- 

Rupiah 

Rial 

Dinar 

Pound 

Pound. 

Lira 

Pound 

Yen 

Dinar 

E.A.  Schilling. 
Hwan 


Kip. 


361,  898. 78 


$9. 047. 47 


20, 408, 333. 98 
157, 365. 38 


$510,  208. 35 
33, 056. 31 


57, 114, 

1, 

36, 311, 

33,  501, 

64,  625, 

,515,913, 

48,  273, 

7,  639, 

24,  075, 

5,844, 

480,  790, 

61, 469, 


579. 48 
541.86 

629. 19 
360. 00 
000. 00 

098. 20 
969.  69 
166.  65 
899.  57 
164.15 
306.  59 
742.81 


701, 

3, 

1,  374, 

671, 

5. 

13,  734, 

10. 184. 

219, 

5,  050, 

5, 629, 

12,  019, 

7,  471. 


450. 38 
452.  23 
444,  86 
908.  54 
363. 07 
035.54 
381.  80 
251. 66 
005. 16 
866.  80 
757. 66 
341.  24 


34, 242. 95 


5, 164. 85 


1, 951,  283. 34 

16, 130,  771. 41 

7, 494. 32 

379,  740.  27 

1, 313,  088,  937. 00 

82,  685,  770.  84 

14,  786,  652.  28 

32, 042. 69 

11,716.90 

280,  766,  934.  80 

30, 255.  35 

29,  508. 12 

195, 928.  98 

815, 640. 00 

21,  866,  644.  83 

1,625,524,359.82 

1, 639,  709,  563. 15 

41, 090, 237.  75 


281, 

806, 

2, 

153, 

4,  097, 

16,  818, 

3,  724, 


824. 64 
538.  62 
997.  73 
430.  41 
001.36 
167.  58 
597.  55 


1, 853. 25 

33, 158.  84 

9,  358,  897.  82 

30,  255.  35 

14,  754. 06 

33,  780.  86 

16,  992.  50 

575,  438.  01 

341,317,450.87 

36.  437,  990. 29 

540,  661. 02 


7, 023. 18 

80,401,158.72 

5, 750, 367,  513.  50 

18, 074. 60 

3,520,814,466.15 


19,  604.  86 
37,  445,  997. 13 
9, 259,  851. 07 

50. 628.  76 
9,  780, 040. 19 


17, 711, 316, 612. 20 
27,  502. 61 


13,  750, 175. 

343. 78 


171,  233, 

1, 

92,  775, 

20,  589, 

370,  893, 

688,  405, 

127,  434, 

31, 177, 

42,  608, 

2, 988, 

780, 219, 

10,212, 

26, 


783. 16 
203. 12 
727. 89 
728.  00 
090. 00 
081. 30 
092.  54 
790. 83 
973.  82 
032.  66 
616,  98 
262.50 
734.  00 


2,  078, 

2, 

3,590, 

412, 

2,271, 

10,  501, 

26,  884, 

894, 

8, 937, 

2,  843, 

19,  505, 

1, 223, 


080. 26 
694. 00 
392.24 
950. 91 
443. 20 
581. 74 
829. 65 
833.  55 
383.  58 
037.  74 
490. 46 
025. 73 
537.50 


74, 073.  78 
353. 00 

46,  744. 32 
5,  972,  203.  60 


11, 172. 52 

990. 00 

6,  751.  30 

298, 610. 32 


623, 384. 40 

1, 101,  509, 185. 00 

16,  894, 209. 02 

99, 367,  740. 80 


251,  872. 56 

3,  436,  845. 35 

3,  447,  798. 39 

25. 029, 657. 65 


910.  50 

507,  288,  416. 10 

1,205,222.37 


2,  577. 00 
16, 909,  613. 84 
1, 205, 222. 37 


35, 975. 75 


6,203.00 


49,  564,  016. 18 

028, 143, 614. 30 

878,  050,  570. 17 

441,830,111.20 

139.  00 

812. 00 

73,  828,  500.  87 

731, 272,  582.  50 

71.96 

147, 267,  426.  65 

361. 11 

17,611.47 

724, 938, 136. 10 

9, 028, 065. 45 


1, 304,  316.  28 

635,  830, 680.  69 

41,  734,  457. 12 

5,  813,  554.  58 

389.  00 

2,  268. 00 

34, 179,  860.  88 

30, 163, 079. 95 

202. 00 

3, 186,  854. 07 

1, 008.  00 

2,  468. 00 

1,331,999.11 

112, 850. 82 


TABLES 


727 


Table  116. 


-Balances  of  foreign  currencies  acquired  by  the  United  States  without 
purchase  with  dollars,  June  SO,  1961 — Continued 


Currency 

In  Treasury  accounts 

In  agency  accounts 

Country 

Foreign 
currency 

Dollar 
equivalent 

Foreign 
currency 

Dollar 
equivalent 

Pruind 

64, 644.  09 
268. 35 

$21,091.06 
749.  79 

Libya 

Pound 

Malaya,  Federa- 

Malayan 
Dollar. 

249. 437. 33 

25, 895, 157. 88 

448,  813.  89 

1, 269,  735.  51 

11,  843, 85 

6,  339,  556.  83 

$81,  534.  84 

2, 073, 271. 25 

88,  913.  83 

267, 312. 74 

1,  560. 84 

1,  766,  548.  71 

tion  of. 

15, 458, 866.  62 
28, 383, 999.  59 
52, 488, 188. 38 

1,237,699  46 

Morocco 

Dirham 

Indian  Rupee. 
Nepalese 
Rupee. 

Guilder 

Pound.. 

5  623  110  59 

11, 021, 141  92 

Nepal 

Netherlands. 

New  Zealand. 

6, 296,  261. 15 
727.  58 

1,  754, 444. 06 
2,028  00 

Nicaragua 

Cordoba 

Pound 

Krone 

222, 215.  78 

8,  320. 73 

1,  529,  724.  85 

712,  774, 852. 54 

7, 902.  73 

2, 478, 000. 00 

94,196,929.00 

6, 6o3, 234.  55 

8,  405, 917,  525. 65 
8, 884, 016. 63 

30, 357. 34 

23,  352. 14 

214,022.37 

149, 824,  416  45 

7,  902.  73 

19, 666.  67 

3,  521,  593. 35 

2,  422,  664. 01 

349,290,321.64 
308,  794. 46 

387. 00 

38, 271.  97 

282, 816, 190. 64 

1,086  52 

Norway 

5  355  00 

Pakistan 

Rupee 

Balboa 

Guarani 

Sol 

59,  446, 387. 93 

Panama.. 

Paraguay... 

Peru          

32, 319, 698.  52 
49,070,873.60 

420, 332.  83 

15, 239, 119.  99 

510,616.00 

3, 665. 40 

8, 057. 68 
224. 45 

6, 095,  458, 973.  05 

45, 483. 03 

26,  065.  28 

35, 187. 38 

24,215,544.34 

1,  880. 056.  36 

245, 105, 072. 86 

28, 961,  549.  56 
16,034,155.17 
10, 437, 924. 08 
30, 200, 835. 08 

1,205,958.91 
17,841,521  33 

Philippines,  Re- 

Peso        

public  of  the. 
Poland. 

Zloty      

7,642  42 

Portugal 

Escudo. 

C.F.A.  Franc. 
Malayan 
Dollar. 
Somalo 

529,  687.  87 

Senegal    

2, 084. 15 
1, 198. 13 

Singapore 

Somalia. 

1, 134. 88 

South  Africa, 

Rand 

13, 858. 57 

4, 252, 113, 169. 25 
3.  435.  51 

2,  721, 317.  26 
3, 352, 408. 31 

25,  894, 160.  57 

29, 411. 13 

291,  757, 106. 75 

28, 489,  534.  56 
60, 967, 433. 09 

3,  550,  762.  29 
29,  534, 193.  42 

272,156.05 

583, 084,  748.  64 

47, 951, 675, 769. 00 

19, 384. 67 

71, 046, 168. 27 

9, 889. 94 

527, 387. 06 

775, 123. 31 

1,  241,  926. 15 

70, 193. 63 
32, 417,  456. 29 

64, 040, 998. 06 
17,  077,  712.  35 
9, 902, 188.  34 

2,  682, 488. 04 

60, 078.  60 
8,  012,  707.  83 
63,  935,  567. 68 

314  00 

Union  of. 
Spain       . . 

Peseta 

Poimd. 

Krona 

102, 441, 359. 16 
130  933  54 

Sudan  

Sweden        

5, 051. 00 
8  135  00 

Switzerland 

Franc . 

Thailand 

Baht 

1,161,416.68 

Tunisia       

Dinar    

4  487  008  02 

Turkey... 

27,  233, 897. 22 

65, 102, 030. 22 
4, 491,  359. 99 

29. 108,  761.  54 
2,  743  036  79 

United  Arab 
Republic: 
Cairo    

Egy.  Pound... 
SjT.  Pound... 

Pound. 

Peso  ._  .-  .- 

Damascus 

United  Kingdom.. 
Uruguay.  .  

Venezuela 

Bolivar 

Piastre 

Dinar 

Vietnam        

601,212,026.17 
30,164,445,285.00 

8  261  811  88 

Yugoslavia 

40,  219,  260. 38 

Total 

'1,323,393,406.49 

11,268,057,545  46 

1  See  last  two  sentences  of  footnote  1  in  preceeding  table. 


728    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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TABLES 


729 


Table  118. — World  War  I  indebtedness,  payments  and  balances  due  under  agree- 
ments between  the  United  States  and  Germany  as  of  June  30,  1961 


Agreements  of  June  23,  1930, 
and  May  26,  1932 

Army  costs 
(reichsmarks) 

Mixed  claims 
(reicbsmarlis) 

Total 
(reichsmarks) 

Total 
(U.S.  dollars) 

Indebtedness  as  funded 

1, 048, 100,  000. 00 

>  1,  632,  000,  000. 00 

2, 680, 100, 000. 00 

2  $1,080, 884, 330. 00 

Payments: 
Principal 

50,  600,  000.  00 
856,  406. 25 

81, 600,  000.  00 
5,  610,  000.  00 

132, 200,  000.  00 
6,  466,  406.  25 

3  31  539  595  84 

Interest.. 

3  2, 048,  213. 85 

Total... 

51, 456, 406.  25 

87,  210, 000.  00 

138,  666,  406.  25 

3  33,  587, 809.  69 

Balance: 

Principal          .  . 

997,  500, 000. 00 
<  375, 172, 364.  00 

1,  550, 400,  000.  00 
321, 300,  000.  00 

2,  547, 900, 000. 00 
4  696,  472, 364. 00 

2 1, 027  568  070  00 

Interest 

2  280, 887,  304.  40 

Total 

1, 372,  672, 364.  00 

1, 871,  700,  000. 00 

53,  244, 372, 364.  00 

21,308,455,374.40 

Agreement  of  February  27,  1953  6 

Indebtedness  as 

funded  in  U.S. 

dollars 

Total  payments 

thiough  June  30, 

1961 

Balance  due 

Mixed  claims  (U.S.  dollars) 

$97, 500, 000. 00 

$29, 800, 000. 00 

$67,  700,  000. 00 

1  Excludes  489,600,000  reichsmarks  canceled  under  agreement  of  Feb.  27,  1953  (see  note  6). 

2  The  amount  of  indebtedness  as  funded  was  converted  to  U.S.  dollars  at  the  rate  of  40.33  cents  to  the 
reichsmark. 

3  The  amount  of  payments  was  converted  at  the  rate  applicable  at  time  of  payment,  i.e.  40.33  or  23.82  cents 
to  the  reichsmark. 

■*  Includes  interest  accrued  under  unpaid  moratorium  agreement  annuities. 

*  Includes  4,027,611.95  reichsmarks  deposited  by  the  German  Government  in  the  Konversionskasse  fur 
Deutsche  Auslandsschulden  and  not  paid  to  the  United  States  in  dollars  as  requued  by  the  agreement. 

6  Under  the  agreement  of  Feb.  27,  1953,  the  United  States  agreed  to  cancel  and  deliver  to  the  German 
Government  24  reichsmarks  bonds  of  20,400,000  reichsmarks  each,  issued  under  the  agieement  of  June  23, 
1930,  and  receive  26  dollar  bonds  amounting  to  $97,500,000.  These  bonds  mature  serially  over  a  pei  iod  of 
25  years  beginning  Apr.  1,  1953.  The  first  5  bonds  are  in  amounts  of  $3,000,000  each,  the  next  5  in  amounts 
of  $3,700,000  each,  and  the  remaining  16  in  amounts  of  $4,000,000  each. 


730   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  119. — Outstanding  indebtedness  of  foreign  countries  on  United  States  Govern- 
ment credits  (exclusive  of  indebtedness  arising  from  World  War  I)  as  of  June  SO, 
1961,  by  area,  country,  and  major  -program  i 

[In  millions  of  dollars] 


Area  and  country 

Under 
Export- 
Import 
Bank 
Act 

Under  mutual 
security  (and 
related  acts) 

Under  Agricultural 
Trade  Develop- 
ment and  Assist- 
ance Act 

Lend- 
lease, 
surplus 
property, 
and  grant 
settle- 
ments 2 

Other 
credits 

Total  I 

Develop- 
ment 
Loan 
Fund 

Other 

Foreign 
govern- 
ment 
loans 

Private 
enter- 
prise 
loans 

Western  Europe: 

Austria    

29 

52 

7 

63 

707 

10 
10 
(*) 

23 

1 

8 

52 

Belgium    and    Luxem- 
bourg  

60 
34 

120 

Denmark 

40 

Finland    - 

18 

1 
5 

10 
516 

217 
26 
(*) 

93 

France -- 

218 

16 
31 
23 

122 
88 

119 
31 
31 
67 
16 

155 

374 
47 

88 
2 

1,446 

Germany,   Federal  Re- 
public of 

243 

Greece 

11 

36 
5 

2 

116 

Iceland    

28 

Ireland 

122 

Italy        

40 
24 
15 
12 
61 

70 

4 

49 
16 

(*) 

250 

Netherlands 

159 

46 

Portugal 

3 
107 

47 

Spain     - 

7 

242 

Sweden -- 

16 

Turkey       -- 

4 

2 

20 

3 

2 
523 

(*) 

'Llii" 

185 

United  Kingdom 

4,212 
279 

Yugoslavia 

33 

40 

160 

European  Coal  and  Steel 
Community 

88 

North   Atlantic  Treaty 
Organi  za  tion  ( M  ain  te- 
nance  Supply  Services 
Agency) 

2 

Total  Western 
Europe.  - 

1,066 

60 

1,523 

441 

15 

1,367 

3,314 

7,787 

Other  Europe: 

Czechoslovakia 

5 

10 

19 

211 

5 

Hungary -- 

10 

Poland    

24 

57 

100 

U.S.S.R — 

211 

Total  other  Europe 

24 

57 

245 

326 

Asia: 

Afghanistan 

39 

12 
12 
2 

60 
315 
16 
61 
40 

51 

Burma 

2 

3 

1 

169 

12 

4 

89 

105 

1 

15 

Ceylon 

2 
25 
163 

2 

80 
27 

8 

China-Taiwan 

29 
89 
79 
38 
99 
184 

1 
3 

118 

3 

43 

24 

233 

India 

743 

Tndfirifisia 

152 

Iran 

208 

Israel  

9 

264 

Japan 

(*) 

289 

Jordan -. 

1 
3 

1 

1 

68 

8 

1 

(*) 

21 

25 

Lebanon 

1 

2 

Malaya 

1 

Pakistan 

1 
48 
(*) 
15 

103 
20 

92 
5 

2 

1 

7 
(*) 
7 

272 

Philippines 

82 

Saudi  Arabia 

7 

Thailand 

9 

(*) 

21 
50 

2 

46 

Vietnam 

50 

Other  Asia 

(*) 

(•) 

Total  Asia           -  .. 

622 

390 

713 

484 

16 

225 

(•) 

2,449 

TABLES 


731 


Table  119. — Outstanding  indebtedness  of  foreign  countries  on  United  States  Govern- 
ment credits  (exclusive  of  indebtedness  arising  from  World  War  I)  as  of  June  SO, 
1961,  by  area,  country,  and  major  program  ' — Continued 

[In  millions  of  dollars] 


Area  and  country 

Under 
Export- 
Import 

Bank 
Act 

Under  mutual 
security  (and 
related  acts) 

Under  Agricultural 
Trade  Develop- 
ment and  Assist- 
ance Act 

Lend- 
lease, 
surplus 
property, 
and  grant 
settle- 
ments 2 

Other 
credits 

Total  1 

Develop- 
ment 
Loan 
Fund 

Other 

Foreign 
govern- 
ment 
loans 

Private 
enter- 
prise 
loans 

Latin  America: 

230 

34 

540 

133 

99 

15 

36 

19 

(*) 

28 

2 

206 

7 

6 

9 

123 

4 

10 

(*) 

24 

1 

(*) 

2 

8 

264 

Bolivia 

36 

Brazil- 

1 
11 

115 

28 
22 

5 

11 

672 

Chile    

171 

3 

123 

Costa  Rica    

(*) 

1 

16 

Cuba 

36 

5 
(*) 
2 
2 

3 
3 

5 

(*) 

(*) 

33 

4 

Haiti             

(*) 

(*) 

30 

3 

1 

8 

10 

5 

222 

(*) 

7 

t 
9 

7" 

13 

Paraguay  .    

6 

2 
12 
11 

18 

2 
2 

1 
(*) 

147 

Uruguay    .. 

2 

19 

17 

Other  Latin  America 

(*) 

Unspecified  Latin  Amer- 
ica  

7 

31 

Total  Latin  America  . 

1,526 

46 

48 

212 

11 

13 

11 

1,868 

Africa: 

British  East  Africa 

1 

1 

Ethiopia-Eritrea 

5 
31 
(*) 

(*) 

"a 

"« 

6 

Liberia         

1 

3 

119 

52 

Libya    

6 

Morocco . 

119 

Nigeria 

1 

1 

land      

14 

4 

18 

7 
5 

7 

Tunisia        .. 

2 

7 

72 

11 

(*) 

72 

United    Arab     Repub- 
lic   „ 

1 
(*) 

7 
2 

50 

1 

71 

Other  Africa 

2 

Total  Africa 

120 

17 

149 

50 

1 

19 

4 

361 

Oceania: 

Australia 

2 

7 

3 

1 
1 

6 

New  Zealand- 

8 

Total  Oceania 

9 

3 

2 

14 

United  Nations 

48 

48 

Unspecified 

19 

19 

Total  all  areas 

3,368 

514 

2,512 

1,188 

43 

1,870 

3,377 

12,871 

*  Less  than  $500,000. 

1  Includes  estimates  for  the  U.S.  dollar  equivalent  of  receivables  denominated  in  other  than  dollars  and/or 
payable  at  the  option  of  the  debtor  in  foreign  currencies,  goods,  or  services.  The  total  amount  of  such 
estimates  approximates  $2,371,000,000. 

2  Data  on  lend-lease,  surplus  property,  and  settlements  for  grants  include  approximately  $350,000,000  for 
surplus  property  and  other  credits  outstanding  and  administered  by  Federal  agencies  other  than  the  Treas- 
ury Department  (Export-Import  Bank  $200,000,000,  State  Department  $114,000,000,  Department  of  the 
Army  $20,000,000,  Maritime  Administration  $15,000,000,  and  General  Services  Administration  $2,000,000), 
and  exclude  about  $84,000,000  in  defaulted  short-term  "cash"  credits  and  deferred  and  otherwise  past  due 
interest.  They  also  exclude  the  value  of  silver  received  by  the  U.S.  Government  ($9,000,000)  but  not  com- 
pletely recorded  in  the  accounts  of  the  Treasury  Department  as  of  June  30, 1961. 

SotiRCE.— U.S.  Department  of  Commerce,  OflSce  of  Business  Economics,  from  data  supplied  by  the  oper- 
ating agencies. 


614359—62- 


-47 


732    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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734 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  120.— Status  of  accounts  under  lend-lease  and  surplus  property  agreements 
(World  War  II)  as  of  June  SO,  1961 — Continued 

PART  II.— BALANCES  DUE  BY  TYPE  OF  AGREEMENT 


Country,  etc. 


Lend-lease 
settlement 
agreements 


Other 
lend-lease 
accounts 


Surplus 

property 

agreements 


Total 


Australia 

Austria 

Belgium  and  Congo  Republic 

Burma - 

China 

Czechoslovakia 

Ethiopia 

Finland --. 

France 

Germany 

Greece 

Hungary 

Iceland 

India 

Iran 

Italy 

Japan 

Korea 

Liberia 

Middle  East 

Netherlands 

New  Zealand 

Pakistan 

Philippines.- 

Poland 

Saudi  Arabia 

Southern  Rhodesia 

Turkey 

Union  of  Soviet  Socialist  Republics- 
United  Kingdom  and  colonies 

Yugoslavia 

American  Republics 

Federal  agencies 


$81, 629. 320.  84 


$817, 456.  30 

508, 489.  85 

7, 561, 678.  32 

1,013,721.10 


$23, 620. 60 


6, 029, 675. 01 


276, 861, 153. 68 


711,753.36 


7, 122, 118. 48 
90, 000. 00 


18, 922, 682. 39 


10, 117, 

260, 082, 

16, 650, 

24, 143, 

10, 085, 

133, 

4, 299, 

1, 998, 

44, 949, 

306, 

24, 930, 


579.  99 
935.  32 
009.  64 
409.  45 
403.  51 
512.73 
019.  61 
335.  32 
661.  91 
307. 11 
523. 10 


15, 508, 704. 03 


15,400.00 


12,  501, 824.  09 


854,  799.  50 


10, 302, 352.  93 
43, 579. 09 


5, 985.  80 
18, 749, 250. 18 


513, 214, 995. 04 

260, 634.  80 

6,  750, 000. 00 


211,563,222.35 
494,'399.'35' 


15, 137. 92 
"32,'023,'975.'49' 


21, 930.  43 


10 
<536 
16 
24; 
10, 

Ml, 

2, 

44; 

24, 
18, 

15, 

9  12, 

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10, 


211, 

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$817, 456. 30 
508, 489. 85 
',  561, 678. 32 
,013,721.10 
,  629,  320.  84 
.,  029, 675. 01 

23, 620.  60 
117,  579. 99 
944, 089. 00 
650, 009. 64 
143.  409.  45 
085, 403.  51 
133, 512.  73 
421, 138.  09 
800, 088.  68 
949,661.91 
306, 307. 11 
930,  523. 10 
922, 682. 39 

15, 400. 00 
508, 704.  03 
854, 799.  50 
501, 824. 09 
5, 985. 80 
749, 250. 18 
302, 352. 93 

43, 579. 09 

15, 137.  92 
563, 222. 35 
238, 970.  53 
260,  634. 80 
244, 399.  35 

21, 930.  43 


Total 832,253,543.90     323,762,217.13 


465, 298, 797. 59 


1,621,314,558.62 


TABLES 


735 


Table  120. — Status  of  accounts  under  lend-lease  and  surplus  property  agreements 
{World  War  II)   as  of  June  SO,  1961 — Continued 

PART  III— LEND-LEASE  SILVER  ACCOUNTS  AS  OF  JUNE  30,  1961 


Country 

Silver  loaned 

Silver  repaid 

Balance  out- 
standing 

(In  ounces) 

(U.S.  dollars) 

(In  ounces) 

(U.S.  dollars) 

(U.S.  doUars) 

Australia 

11, 772, 730.  21 
261, 333.  33 
5, 425. 000.  00 
172,  542, 107.  00 
56,737,341.25 
53, 457, 797. 00 
21,316,120.01 
88,270,241.84 

$8, 371, 719. 26 

185, 837.  03 

3, 857, 777.  77 

122, 696, 609.  42 

40, 346,  553.  77 

38,014,433.42 

'  16, 277,  578.  02 

62, 769, 949.  72 

11, 772, 730.  21 

261, 333.  33 

5,425,000.00 

168,  572, 104.  40 

56, 737, 341. 25 

35, 877, 106.  89 

6, 828, 436. 20 

88,270,241.84 

$8,371,719.26 

18.5,837.03 

3, 857, 777.  77 

119,873,496.44 

40,346,553.77 

25,  512, 609. 33 

5, 975, 225.  09 

62, 769, 949.  72 

Belgium .  _  ..- 

Ethiopia 

India 

Netherlands.--  

9  $2, 823, 112. 98 

Pakistan..- 

6 12,  501, 824.  09 
10, 302, 352. 93 

United  Kingdom  -  ... 

Total  . 

409,782,670.64 

292,520,458.41 

373, 744, 294. 12 

266, 893, 168.  41 

25, 627, 290. 00 

'  Includes  accrued  interest  through  July  1,  1961. 

2  Represents  cash  payments  by  foreign  governments  in  excess  of  biUings  under  advance  payment  agree- 
ments.   -Amounts  being  held  pending  settlement  for  lend-lease. 

3  Principally  billings  considered  past  due  as  of  June  30,  1960,  and  items  subject  to  negotiation. 
<  Includes  $58,683,579.27  principal  and  interest  installments  postponed  pursuant  to  agreement. 

« Includes  silver  valued  at  $2,823,112.98  which  is  in  the  possession  of  the  United  States  and  is  currently  in 
the  process  of  being  assayed. 

» Includes  silver  valued  at  $5,977,095.26  v?hich  is  in  the  possession  of  the  United  States  and  is  currently  in 
the  process  of  being  assayed. 

'  Principal  obligation  increased  in  the  amount  of  $1,119,448.25  to  give  effect  to  U.S.  doUar  payment  in  lieu 
of  silver. 

8  Includes  $28,647,846.90  principal  and  interest  installments  postponed  pursuant  to  agreements. 

9  See  footnote  5. 


736 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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738   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  122. — Borrowing  authority  and  outstanding  issues  of  Government  corpora- 
tions and  certain  other  business-type  activities  whose  obligations  are  issued  to  the 
Secretary  of  the  Treasury,  June  30,  1961  ' 

[In  millions  of  dollars.    On  basis  of  daily  Treasury  statements] 


Corporation  or  activity 


Borrowing 
authority 


Outstand- 
ing obli- 
gations 
beld  by 
Treasury 


Unused 
borrowing 
authority 


Commodity  Credit  Corporation 

Export-Import  Bank  of  Washington 

Federal  Deposit  Insurance  Corporation 

Federal  home  )oan  banks 

Federal  National  Mortgage  Association: 

Management  and  liquidating  functions 

Secondary  market  operations 

Special  assistance  functions 

Federal  Savings  and  Loan  Insurance  Corporation 

Housing  and  Home  Finance  Administrator: 

College  housing  loans - - 

Flood  insurance... 

Public  facility  loans , 

Urban  renewal  fund 

International  Cooperation  Administration: 

India  emergency  food  aid 

Loan  to  Spain 

Mutual  defense  program — economic  assistance 

Foreign  investment  guaranty  fund , 

Panama  Canal  Company 

Public  Housing  Administration 

Kural  Electriflcation  Administration 

Saint  Lawrence  Seaway  Development  Corporation 

Secretary  of  Agriculture,  Farmers'  Home  Administration: 

Farm  housing  loan  program 

Regular  loan  programs 

Farm  tenant  mortgage  insurance  fund 

Secretary  of  Commerce: 

Area  Redevelopment  Administration 

Maritime  Administration,   Federal  ship  mortgage  insurance 
fund 

Secretary  of  the  Treasury  (Federal  Civil  Defense  Act  of  1950,  as 
amended) 

Tennessee  Valley  Authority. 

U.S.  Information  Agency,  informational  media  guaranty  fund 

Veterans'  Administration  (veterans'  direct  loan  program) 

Virgin  Islands  Corporation 

Defense  Production  Act  of  1950,  as  amended: 

Export-Import  Bank  of  Washington 

General  Services  Administration. 

Secretary  of  Agriculture.. 

Secretary  of  the  Interior,  Defense  Minerals  Exploration  Admin 

Secretary  of  the  Treasury 

Unallocated 

District  of  Columbia  stadium  fund 

Total 


14, 500 
6,000 
3,000 
1,000 

1,580 

2,250 

3,358 

750 

1,675 
500 
650 

1,000 

23 

42 

1,042 

199 

10 

1,500 

4,  225 

140 

585 

6  272 

29 

300 

1 

250 

M50 

28 

1,330 

1 

20 

1,804 

73 

36 

157 

10 

i}) 


11,534 
1,698 


1,441 
"i,'762' 


2  2,966 

3  4, 302 
3,000 
1,000 

U39 

'  2, 250 

1,596 

750 

687 
500 
590 
835 


23 

42 

1,042 


(*) 
(*) 


32 

3,332 

121 

154 
272 
29 


199 
10 
1,468 

894 
19 

431 


300 


(*) 


250 
150 


20 

1,330 

1 

10 
1,765 
65 
32 
93 


48, 491 


26,011 


22, 480 


•  Less  than  $500,000. 

'  Excludes  authorizations  to  borrow  from  the  public;  also  excludes  authorizations  to  expend  from  public 
debt  receipts  for  subscriptions  to  capital  stock  of  the  following  agencies:  International  Bank  for  Recon- 
struction and  Development,  $6,350  million;  International  Monetary  Fund,  $2,325  million;  International 
Finance  Corporation,  $35  million;  and  certain  Government  corporations,  $1,135  million.  In  addition,  the 
authorized  credit  to  the  United  Kingdom,  of  which  $3,314  million  is  outstanding,  has  been  excluded. 

'  Obligations  for  the  purchase  or  the  guarantee  of  loans  held  by  lending  agencies  amounted  to  $606  million 
as  of  June  30, 1961.  The  unused  authority  to  borrow  from  the  Treasury  has  not  been  reduced  thereby,  since 
the  Corporation  may  borrow  from  the  Treasury  to  liquidate  these  obligations. 

3  Obligations  for  guaranteed  letters  of  credit  and  loans  disbursed  by  commercial  banks  amounted  to  $141 
million  as  of  June  30, 1961.  The  unused  authority  to  borrow  from  the  Treasury  has  not  been  reduced  there- 
by, since  the  Corporation  may  borrow  from  the  Treasury  to  liquidate  these  obligations. 

*  Transferred  to  the  special  assistance  functions  fund  as  of  July  1, 1961,  in  accordance  with  an  act  approved 
June  30, 1961  (75  Stat.  176). 

'  The  balance  shown  represents  unused  portion  of  authorization  to  expend  from  public  debt  receipts 
available  for  loans  to  the  secondary  market  operations  fund  without  further  action  by  Congress.  Because 
of  borrowing  and  the  capital  structure  of  the  fund,  the  maximum  it  could  borrow  from  the  Treasury  without 
adjusting  its  other  borrowing  or  its  capital  structure  as  of  June  30, 1961,  would  be  as  follows: 

Borrowing  authorised  (10  times  capital  plus  surplus) $2,649,582,143 

Borrowing  outstanding.. -2,198,920,000 

Unused  balance  of  borrowing  authorized 450,662,143 

«  Has  not  been  reduced  by  $0.3  million  representing  return  of  uncommitted  funds  to  the  Treasury  which 

was  not  received  in  time  for  inclusion  in  the  daily  Treasury  statement  of  June  30, 1961. 
'  Represents  amount  of  interim  obligations  outstanding  which  may  be  issued  to  the  Secretary  of  the 

Treasury  under  speciQed  conditions  as  provided  by  an  act  approved  Aug.  6,  1959  (16  U.S.C.  831n-4  (c)). 
»  Funds  may  be  borrowed  from  the  Secretary  of  the  Treasury  imder  certain  conditions  as  provided  by 

aa  act  approved  July  28, 1958  (2  D,C.  Code  1727). 


TABLES 


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740    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  124. — Description" of  obligations  of  Government  corporations  and  certain  other 

business-type  activities  held  by  the  Treasury,^  June  SO,  1961 

[On  basis  of  daily  Treasury  statements,  see  "  Bases  of  Tables"] 


Title  and  authorizing  act 


Date  of  issue 


Date  payable  ^ 


Rate  of 
interest 


Principal  amount 


Commodity  Credit  Corporation,  act  of 
Mar.  8,  1938,  as  amended: 
Note,  Series  Fourteen— 1962 


Export-Import  Bank  of  Washington,  act 
of  July  31,  1945,  as  amended: 

Note,  Series  1961 

Notes,  Series  1965... 

Notes,  Series  1965. 

Notes,  Series  1965 

Notes,  Series  1965  and  1972 

Notes,  Series  1965 

Notes,  Series  1965,  1967,  and  1968 

Notes,  Series  1968 

Note,  Series  1977 


June  30,  1961. 


Dec.  31,1951.. 
Various  dates. 

do. 

do... 

do 


June  30,  1962. 


do 

do 

do 

June  30,  1959. 


Dec.  31, 
Various 
June  30, 
Various 

do.. 

Dec.  31, 
Various 
June  30, 
June  30, 


1961.. 
dates. 
1965- . 
dates. 


1965.. 
dates. 
1968- . 
1977.. 


Total. 


Federal  National  Mortgage  Association, 
act  of  Aug.  2,  1954,  as  amended: 
Management  and  liquidating  func- 
tions: 

Note,  Series  C 

Note 

Note,  Series  C 

Notes,  Series  C. 


Subtotal. 


Special  assistance  functions: 

Notes,  Series  D 

Note,  Series  D 

Notes,  Series  D. 

Notes,  Series  D 

Notes,  Series  D 

Notes,  Series  D 

Notes,  Series  D 

Notes,  Series  D.. 

Note,  Series  D 

Note,  Series  D .-. 

Note,  Series  D 

Notes,  Series  D.. 

Notes  Series  D 

Notes,  Series  D 

Notes,  Series  D 

Notes,  Series  D 

Note,  Series  D 

Note,  Series  D 

Notes,  Series  D 

Note,  Series  D 


June  26,  1958.. 
Jan.  11,  I960.-. 
June  1,  1961... 
Various  dates. 


Subtotal. 


Total  Federal  National  Mort- 
gage Association 


Housing  and  Home  Finance  Adminis- 
trator: 
College  housing  loans,  act  of  Apr. 
20,  1950,  as  amended: 

Notes,  Series  B  and  D 

Notes,  Series  C,  E,  and  O 

Notes,  Series  C  and  F 

Notes,  Series  H 

Note,  Series  I 


Subtotal- 


Public  facility  loans,  act  of  Aug.  11, 
1955: 

Note,  Series  PF. 

Notes,  Series  PF. 

Notes,  Series  PF 

Note,  Series  PF 

Note,  Series  PF 

Note,  Series  PF 

Note,  Series  PF 


Various  dates.. 

July  2,  1956 

Various  dates . . 

do 

do... 

do 

do 

do 

Mar.  3,  1958 

Apr.  1,  1968 

June  2,  1958 

Various  dates.. 

do.... 

do 

do 

do-.-. 

Aug.  3,  1959 

Oct.  1,  1959 

Various  dates.-. 
Jan.  4,  1960 


July  1,  1962- 
Jan.  11,  1965- 
July  1,  1965- 
do 


Various  dates. 
do 

do.... 

.do. 


July  1,  1960. 


Oct.  31,  1959 

Various  dates 

do 

Feb,  29,  1960 

Mar.  31,  1960 

Apr.  30,  1960 

July  29, 1960 


Various  dates  . 
July  1,  1961—. 
Various  dates. 

do 

do 

do 

do— 

do 

July  1,  1962—. 

do- 

do... 

Various  dates  . 

....do 

.-.-do 

-—do-— 

July  1,  1964-... 

...-do 

...-do 

-..do 

-..do 


Various  dates. 

do..- 

do 

do. 


July  1,  1980. 


Nov.  30,  1972... 
Various  dates.. 

...-do 

Feb.  1,  1975.... 
Mar.  1,  1975... . 
Apr.  1,  1975.... 
July  1, 1975 


Percent 
2H 


2 

2H 

2H 

2^ 

3H 

3% 

356 

3H 

2H 


2H 
4 


2% 

2^ 

3 

3J4 

3H 

3% 

3% 

3H 

2H 

2\<i 

2H 

2% 

3li 

4 

4H 

4^ 

4M 
4^ 


2H 
2H 
2H 
21^ 


3Mo 

456 
4?i 

4 


$11,  534,  000, 000.  00 


451, 100, 
191,  500, 

48,  900, 
194,  600, 
225,  500, 

26, 400, 
162,  700, 

76,  100, 
321,  100, 


000.  00 
000.  00 
000.  00 
000.  00 
000. 00 
000.  00 
000.  00 
000.  00 
OUO.  00 


1, 697, 900, 000.  00 


624, 170, 000.  00 

130,  264,  300.  00 

13,  200,  000.  00 

672, 870, 000.  00 


1, 440,  504,  300.  GO 


29, 43b, 

43, 

13,  700, 

34,  338, 

78,  042, 

13,  052, 

254,  646, 

144, 800, 

16,  507, 

16,  199, 

11,019, 

26, 372, 

439,  033, 

150,  034, 

162,  574, 

124, 327, 

144,  410, 

28,  660, 

62,  640, 

11,  745, 


080.  58 
768.  57 
115.63 
376.  04 
586.  52 
831.  88 
370.  35 
364.  54 
793.  30 
624.  25 
173.  23 
411.21 
568.  02 
904.  80 
197.  47 
000. 00 
000.  00 
000.  00 
000.  00 
000. 00 


1,  761,  584, 166.  39 


3,  202,  088, 466. 39 


327,  507,  000.  00 
304,  495, 000.  00 
200,  794, 000.  00 
139, 929,  000.  00 
15,  500,  000.  00 


988,  225,  000.  00 


49,331,400.00 
6, 149,  500. 00 
978,  000.  00 
200,  000.  00 
188,  000.  00 
549, 000. 00 
1, 459, 000. 00 


Footnotes  at  end  of  table. 


TABLES 


741 


Table  124. — Description  of  obligations  of  Government  corporations  and  certain  other 
business-type  activities  held  by  the  Treasury,^  June  SO,  1961 — Continued 


Title  and  authorizing  act 

Date  of  issue 

Date  payable » 

Rate  of 
interest 

Principal  amount 

Housing  and  Home  Finance  Adminis- 
trator—Continued 
Public  facility  loans,  act  of  Aug.  11, 
1955— Continued 
Notes,  Series  PF 

Various  dates... 
June  15, 1961 

Various  dates. .. 
Mar.  1,1976 

Percent 
ZH 

$1,  237, 000. 00 
168, 000. 00 

Note,  Series  PF 

Subtotal . 

60, 259, 900.  00 

Dec.  31, 1958 

do.... 

Dec.  31, 1963 

June  30,  1964 

Dec.  31,  1964 

June  30,  1965 

Dec.  31,  1965 

June  30,  1966 

3 

35i 

m 

4^ 

43/i 

3% 

Urban  renewal  fund,  act  of  July  15, 
1949,  as  amended: 
Note 

60,  000, 000. 00 
20,  000, 000.  00 
20,  000,  000.  00 
25,  000,  000.  00 
25,  000,  000.  00 
15,  000, 000. 00 

Note 

Note 

June  30,  1959 

Dec.  31,  1959 

June  30,  1960 

Dec.  31,  1960 

Note 

Note 

Note 

Subtotal 

165, 000, 000. 00 

Total     Housing    and     Home 
Finance  Administrator 

1,  213, 484, 900. 00 

Various  dates... 
Feb.  6,  1952 

June  30,  1977 

June  30,  1984 

Dec.  31,  1986 

m 

2 

International   Cooperation  Administra- 
tion: 
Act  of  Apr.  3,  1948,  as  amended: 

Notes  of  Administrator  (E.C.A.). 
Notes  of  Administrator  (E.G. A.) 
Act  of  June  15,  1951: 

Note  of  Director  (M.S.A.) 

41, 969, 928.  20 
1,  041,  601, 814. 03 

22, 995,  512.  59 

Total 

1, 106,  567,  254. 82 

Nov.  9,  1956 

Various  dates... 

Nov.  26, 1954 

Various  dates... 

-""Ido""IIII"I 
..      do  ... 

On  demand 

Various  dates... 

Dec.  31, 1963 

Dec.  31, 1964 

Various  dates... 

Dec.  31,  1966 

Various  dates... 

do.„. 

do.... 

do 

do 

do—. 

do 

do 

do 

do 

Dec.  31,2003 

Dec.  31,2004 

2% 

2 

2% 

2^ 

2% 

2H 

2li 

3 

ZM 

3H 

Z% 

35^ 

ZVi 
4 

3Ji 

Public  Housing  Administration,  act  of 
Sept.  1, 1937,  as  amended: 
Note 

32, 000, 000. 00 

Rural  Electrification  Administration,  act 
of  May  20,  1936,  as  amended: 

3, 331, 587, 765. 32 

Corporation,  act  of  May  13,  1954: 

946, 686. 06 
800, 000.  00 
700, 000.  00 
900, 000.  00 
5, 100, 000.  00 

7,  800, 000.  00 

8,  200,  000.  00 
24,  600,  000.  00 
15,  900,  000.  00 

9,  900,  000.  00 
31, 100.  000.  00 

4,  600,  000.  00 
5, 400,  000.  00 
2,  200,  000. 00 
600,  000.  00 
1, 800, 000.  00 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds 

do.... 

do 

do.... 

Revenue  bonds.. 

Revenue  bonds 

Revenue  bonds 

Revenue  bonds. 

Revenue  bonds... 

Revenue  bonds.. 

Revenue  bonds 

Revenue  bonds  

do 

do 

do 

do 

do... 

do 

do       

Total. 

120, 546, 686. 06 

Sept.  8,  1958 

Various  dates... 
do 

June  30, 1991 

Various  dates 

June  30,  1991 

Various  dates 

June  30, 1993 

3H 
ZVi 
4 

3% 

Secretary  of  Agriculture,  Farmers'  Home 
Administration: 
Farm  housing  loan  program,  act  of 
Aug.  7,  1956: 
Note 

4, 757,  223.  78 
35,  600, 000.  00 
20,  000,  000.  00 
47  540  000  00 

Notes.. 

Notes... 

Notes... 

-    do 

Notes 

do 

46, 450, 000. 00 

Subtotal. 

154,  247,  223.  78 

Various  dates... 

Various  dates... 

3 

Regular  loan  programs,  acts  of  July 
8,  1959,  and  June  29,  1960: 
Notes . 

'  272, 250, 385.  60 

Footnotes  at  end  of  table. 


742   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  124. — Description  of  obligations  of  Government  corporations  and  certain  other 
business-type  activities  held  by  the  Treasury,^  June  SO,  1961 — Continued 


Title  and  authorizing  act 


Date  of  issue 


Date  payable '     Rate  of 
Interest 


Principal  amount 


Secretary  of  Agriculture,  Farmers'  Home 
Administration— Continued 
Farm    tenant    mortgage    insurance 
fund,  act  of  Aug.  14,  1946: 

Notes 

Notes.. 

Notes.. 

Notes 

Notes.. 

Notes.. 

Notes.. 

Notes... 

Notes.. 


Various  dates  _ 
do 


.do- 
.do. 
.do. 


June  30,  1963. 

do 

do 


.do. 
.do. 
.do- 
.do. 


Various  dates. 
do 

June  30,  1963,. 
Various  dates. 
June  30, 1965.. 
do 


Subtotal. 


Total  Secretary  of  Agriculture. 

Secretary  of  Commerce,  Maritime  Ad- 
ministration: 
Federal    ship    mortgage    insurance 
fund,  act  of  July  15,  1958: 
Note 


Secretary  of  the  Treasury,  Federal  Civil 
Defense  Act  of  1950,  as  amended: 
Note,  Series  FCD 


United  States  Information  Agency: 

Informational  media  guaranty  fund, 
act  of  Apr.  3,  1948,  as  amended: 
Note  of  Administrator  (E.C.A.) 


Note  of  Administrator  (E.O.A 
Note  of  Administrator  (E.C..\ 
Note  of  Administrator  (E.C..\ 
Note  of  .A.dministrator  (E.G. A 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 
Note  of  Administrator  (E.C.A. 


Total. 


Veterans'  Administration  (veterans'  di- 
rect loan  program),  act  of  Apr,  20, 
1950,  as  amended: 

Agreements 

Agreements 

Agreements 

Agreements 

Agreements 

Agreement 

Agreement 

Agreement. 

Agreement 

Agreements.. 

Agreements 

Agreements.. 

Agreements 

Agreement 

Agreement- 

Agreement 


Total. 


Virgin  Islands  Corporation,  act  of  Sept. 
2,  1958,  as  amended: 

Note 

Note - 

Note 

Notes.. 

Notes 


Total... 

Footnotes  at  end  of  table. 


Feb.  20,  1959. . . 


July  1,  1959. 


Feb.  20,  1964. 


July  1,  1964- 


Oct.  27,  1948- 

do 

do .- 

Jan.  24,  1949.. 

do .- 

do 

-..do 

.-..do - 

-..do 

.--do -- 

--.-do -- 

—  -do .- 

-...do 

.-.-do 

.--do 


Various  dates, 
.—do 

....do 

.-..do 

-.-.do 

Mar.  29,  1957.. 
June  28,  1957.. 
Apr.  7,  19,58--- 
Oct.  6,  1958— 
Various  dates. 

-.-do 

....do 

.--.do 

Feb.  5,  1960... 
Apr.  1,  1960... 
July  19,  I960-. 


Sept.  30,  1959.. 
Oct.  15,  1959... 
Feb.  24,  I960.. 
Various  dates. 
.-..do 


June  30,  1986. 

.-..do 

..-.do 

---.do 

--.do -- 

.--.do 

-.-.do 

---do 

---do.. 

.-..do 

.-..do 

..-.do 

—  -do -- 

---do - 

.--.do 


Indefinite. 

do 

do 

do..-. 

do 

,.  .-do 

do.-.. 

.-..do 

do 

do 

-..do 

--.do 

-.-do 

---do.--, 
---do.--- 
do 


Sept.  30,  1979-. 
Oct.  15,  1979-. 
P'eb.  24,  1980- . 
Various  dates- 
Junel5, 1981.. 


Percent 
2.632 
2.638 
314 
35i 
3M 

4 

3^ 

31/2 


3Ji 


4% 


1% 
2 

2^ 

23/^ 

234 

27^ 

3 

ZM 

ZH 

316 

Z% 

334 

z% 

4 


2^ 

234 

2Ji 

3 

33.^ 

ZVi 

ZVi 

Z\i 

ZH 

334 

Zli 

iM 

4J^ 

45/6 

AM 
4 


4'>6 

Z% 
3% 


$450, 
485, 

1,  775, 
6,  785, 

2,  575, 
8, 125, 
2, 345, 
3, 825, 

3,  025, 


000.  00 
000.  00 
000.  00 
000.  00 
000. 00 
000.00 
000.00 
000.00 
000.  00 


29, 390,  000. 00 


455, 887,  609. 38 


1, 400, 000.  00 


440. 000.  00 


1,410, 
1, 305, 
2,  272, 

775, 
75, 

302, 
1, 865, 
1, 100, 

510, 
3,431, 

495, 

220, 
2,  625, 
2, 137. 
1, 493, 


000.  00 
000.  00 
610.  67 
000.  00 
000.  00 
389  33 
000  00 
000. 00 
000. 00 
548.00 
000.  00 
000.  00 
960.  00 
000.  00 
192.  00 


20, 018. 000.  00 


88, 342, 
53,  032, 

102,  845. 

118,763, 

316,  8?6, 
49,  768, 
49,  838, 
49,  571. 
48,  855, 
99,  889, 
52.  344, 

109,  387, 
99,  909, 
20,  000, 
20,  703, 
50, 000, 


741  00 
393.  00 
334  00 
868  00 
356  00 
442  00 
707.  00 
200.  00 
090  00 
310  00 
5.55  00 
321  00 
137.  93 
000.  00 
541.07 

oon.  00 


1, 330. 077. 996  00 


10, 000.  00 
.500.  00 

23, 400.  00 
110.000.00 
450, 000. 00 


693. 900.  00 


TABLES 


743 


Table  124. — Description  of  obligations  of  Government  corporations  and  certain  other 
business-type  activities  held  by  the  Treasury,^  June  SO,  1^61- — Continued 


Title  and  authorizing  act 

Date  of  issue 

Date  payable  ^ 

Rate  of 
interest 

Principal  amount 

Defense    Production    Act    of    1950,    as 

amended: 

Export-Import  Bank  of  Washington: 

Percent 

Note,  Series  DP 

June  30,  1958 

Various  dates. . . 
May  10,  1954 

June  30,  1963 

Dec.  31,  1965 

do 

2H 
2H 
2% 

$6, 695. 443.  49 

Notes,  Series  DP 

3, 400, 000.  00 

Notes,  Series  DP 

178, 063. 87 

Subtotal                

10, 273, 497.  36 

General  Services  Administration: 

Notes  of  Administrator,  Series  D. 

Various  dates. .. 

Various  dates... 

23-1 

125,  OnO,  000.  00 

Notes  of  Administrator,  Series  D. 

do 

do 

2Ji 

85, 000, 000.  00 

Notes  of  Administrator,  Series  D. 

do 

do 

3 

110,000,000.00 

Notes  of  Administrator,  Series  D- 

do 

do 

3-^^ 

200, 000,  ono.  no 

Note  of  Administrator,  Series  D-. 

Mar.  26,  1957...- 

Mar.  26,  1962.... 

3^4 

25,000,00100 

Note  of  Administrator,  Series  D.. 

Apr.  16,  1958 

Apr.  16,  1963 

25^ 

35, 000. 000. 00 

Notes  of  Administrator,  Series  D. 

Various  dates. . . 

Various  dates... 

ZH 

50, 000, 000.  00 

Notes  of  Administrator,  Series  D. 

do 

do 

Z-'A 

215,000,000.00 

Notes  of  Administrator,  Series  D. 

do 

do 

2H 

11.5, 000, 000.  00 

Note  of  Administrator,  Scries  D.. 

Jan.  2,  1959 

Jan.  2,  1964 

Z% 

40, 000, 000.  00 

Notes  of  Administrator,  Series  D. 

Various  dates... 

Various  dates 

4 

165, 000, 000.  00 

Note  of  Administrator,  Series  D.. 

June  1,  1959 

June  1,  1964 

41/4 

85,  000, 000.  00 

Notes  of  Administrator,  Series  D. 

Various  dates... 

Various  dates 

4?i 

383,  700, 000.  00 

Notes  of  Administrator,  Series  D. 

do 

do 

4^4 

30, 000, 000.  00 

Note  of  Administrator,  Series  D.. 

Oct.  21,  1959 

Oct.  21,  1964 

434 

8, 000, 000.  00 

Notes  of  Administrator,  Series  D. 

Various  dates -.- 

Various  dates.. . 

45.6 

53, 000, 000.  00 

Notes  of  Administrator,  Series  D. 

do 

do 

m 

30,000,000.00 

Note  of  Administrator,  Series  D.. 

Oct.  11,  1960 

Oct.  11,  1965 

3^ 

10,000,000.00 

Subtotal -.- 

1,  764, 700. 000. 00 

Secretary  of  Agriculture: 

Note -- 

Julys.  1957 

Various  dates -.. 

July  1,  1959 

July  1,  1960 

Feb.  7,  1961 

July  1,  1962 

Various  dates... 

July  1,  1964 

July  1,  1965 

do 

334 

23/^ 

m 
4 

z% 

3, 097,  000. 00 

Notes    _            -.    

10,458,000.00 

Note - 

50, 145.  000.  00 

Note  .            

62, 000.  00 

815,  779.  63 

Subtotal 

64,  577,  779.  63 

Secretary  of  the  Interior,  Defense  Min- 

erals Exploration  Administration: 

Note 

Apr.  29,  1955..-. 

Feb.  18,  1955 

Various  dates.. . 
Aug.  31,  1956.... 
Nov.  19,  1956...- 

July  1,  1964 

do 

2Vi 

2% 

2% 

3 

3H 

3% 

3H 
3% 
3^^ 

1,000,000.00 

Note 

1, 000,  000.  00 

Notes       .  -  .  -  -  -  -  .  

Various  dates... 

July  1,  1966 

do 

6, 000. 000.  00 

Note 

1, 000, 000.  00 

Note                            -- 

1.000.000.00 

Notes 

Various  dates 

Jan.  30,  1957 

Aug.  12,  1957... . 
Various  dates... 
Jan.  17,  1958 

Various  dates  ... 

July  1,  1966 

July  1,  1967 

Various  dates... 
July  1,  1967 

17,  000, 000. 00 

Note                                   

1, 000, 000. 00 

Note.-  . 

1, 000,  000. 00 

Notes ... 

2, 000, 000. 00 

Note 

1, 000, 000. 00 

Subtotal 

32,  000, 000. 00 

Secretary  of  the  Treasury: 

Note,  Series  TDP... - 

July  1,1958 

Dec.  1,1960 

Dec.  1,1962 

July  1,1965 

23^ 
3% 

16, 010, 000. 00 

Note,  Series  TDP -.- 

76,  590, 000.  00 

Subtotal 

92, 600, 000. 00 

Total  Defense  Production  Act 

1, 964, 151, 276.  99 

of  1950,  as  amended. 

Total  obligations 

3  26,010,743,854.96 

'  These  obligations  were  issued  to  the  Treasury  in  exchange  for  advances  by  the  Treasury  from  public 
debt  receipts  under  congre.ssional  authorization  for  specified  Government  corporations  and  other  business- 
type  activities  to  borrov?  from  the  Treasury. 

2  Obligations  may  bo  redeemed  at  any  time. 

» Of  this  amount,  $290,778.26  of  uncommitted  funds  has  been  returned  to  the  Treasury  although  not 
received  in  time  for  inclusion  m  the  daily  Treasury  statement  of  June  30,  1961. 


744   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


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1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  126. — Statement  of  loans  outstanding  of  Government  corporations  and  certain 
other  business-type  activities,  June  30,  1961 

[In  thousands  of  dollars] 

LOANS  OUTSTANDING,  EXCLUDING  INTERAGENCY  LOANS  AND  THOSE  MADE  BY 
DEPOSIT   AND  TRUST   REVOLVING  FUNDS,   CLASSIFIED   BY  TYPES   OF   LOANS  ' 


U.S.  dollar  loans 

Type  of  loan  and  lending  agency 

Total 

Public 
enterprise 
revolving 

funds 

Certain 

other 
activities 

Foreign 

currency 

loans  - 

To  Aid  Ageicxjlture 
Loans  to  cooperative  associations: 

12.  466 

3,  367,  355 

869,  692 

54,  270 

2,  643 

2 

47,311 

506.  252 

12,  466 
3,  367,  355 

Rural  Electrification  Artministration 

Crop,  livestock,  and  commodity  loans: 

869,  692 
54.  270 

Farmers'  Home  Administration 

2.  643 

47,311 

Storage  facility  and  equipment  loans: 

Farm  mortgage  loans: 

506,  252 

35.  822 

3  605,  762 

475,  663 

35,  S22 
3  605.  762 

Guaranteed  loans  held  by  lending  agencies: 

Other  loans: 

Farmers'  Home  Administration               

475,  663 

5, 977,  238 

1,  612, 859 

4,  364,  379 

To  Aid  Home  Owners 
Mortgage  loans: 

202,  195 

1,  587, 118 
1,  828,  775 

4,345 
729 

173 
387 

1,  221,  937 
3,992 

6,714 
384,  553 

202, 195 

1,  587, 118 
1,  828,  775 

4,345 
729 

173 
387 

1,  221, 937 

Federal  National  Mortgage  Association: 

Management  and  liquidating  functions 

Housing  and  Home  Finance  Administrator: 

Interior  Department: 

Bureau  of  Indian  Affairs,  liquidation  of  Hoonah 

Public  Housing  Administration 

Veterans'  Administration: 

3,992 

Other  loans: 

Veterans'  Administration: 

Di'reft  loans  to  vptprans  pnd  rp.sfirve<! 

6,714 

384,  553 

5,  240, 919 

4,  852,  375 

388,  545 

To  Aid  Industrt 

Loans  to  railroads: 

Expansion  of  defense  production: 
Treasiu'v  Department 

1,145 

5,573 

4,006 
132,  816 

13,  295 
120,  442 

3,  446 
2,453 
1,067 

1,145 

5,573 
4.  006 

Other  purposes: 

Treasury  Department: 

Reconstruction  Finance  Corporation  liqui- 

Ship  mortgage  loans: 

Commerce  Department: 

132, 816 

Other  loans: 

Expansion  of  defense  production: 

13,  295 
120,  442 

3,446 
2,453 
1,667 

Defense  production  guarantees: 

Army  Department                  - 

Navy  Department 

Footnotes  at  end  of  table. 


TABLES 


747 


Table  126. — Statement  of  loans  outstanding  of  Government  corporations  and  certain 

other  business-type  activities,  June  SO,  1961 — Continued 

[Id  thousands  of  dollars] 

LOANS  OUTSTANDING,  EXCLUDING  INTERAGENCY  LOANS  AND  THOSE  MADE  BY 

DEPOSIT  AND  TRUST  REVOLVING  FUNDS,  CLASSIFIED  BY  TYPES  OF  LOANS  i— Con. 


U.S.  dollar  loans 

Type  of  loan  and  lending  agency 

Total 

Public 
enterprise 
revolving 

funds 

Certain 

other 

activities 

Foreign 

currency 

loans  2 

To  Aid  Industry— Continued 

Other  loans— Continued 
Other  purposes: 

General  Services  Administration: 

Reconstruction  Finance  Corporation  liqui- 
dation fund -  -  

558 

4. 1S3 
5,000 

229 

6,507 
118 

414,454 

2,006 

798 

9,028 

558 

4, 183 

5,000 

Housing  and  Home  Finance  Administrator: 
Liquidating  programs           _  

Inland  Waterways  Corporation 

Interior  Department: 

Office  of  Minerals  Exploration 

229 

Bureau  of  Commercial  Fisheries: 

Fisheries  loan  fund 

6,507 
118 

414,454 

2,006 

798 

9,028 

Virgin  Islands  Corporation 

Small  Business  Administration: 

Revolving  fund  (lending  operations) 

Reconstruction  Finance  Corporation  liqui- 
dation fund.  

Treasury  Department: 

Civil  defense  loans      _  

Reconstruction  Finance  Corporation  liqui- 
dation fund 

Total  to  aid  industry 

727,  724 

594,  679 

133, 045 

To  Aid  States,  Territories,  etc. 

General  Services  Administration: 

Public  Works  Administration  (in  liquidation) 

77, 269 

710 

55,  449 

7, 985 

78, 558 

4 

34,711 

16,814 

861 

96, 668 

33, 721 

77,  269 
710 

Health,  Education,  and  Welfare  Department: 

Public  Health  Service 

Housing  and  Home  Finance  Administrator: 

Public  facility  loans                               .  -      

55, 449 

7,985 

78,  558 

4 

Liquidating  programs    

Urban  renewal  fund                                   .      .  .    . 

Interior  Department: 

34,711 

16,814 

861 

Office  of  Territories,  Alaska  Public  Works 

National  Capital  Planning  Commission    

Public  Housing  Administration 

96, 668 

Treasury  Department: 

Miscellaneous  loans  and  certain  other  assets       -  - 

33, 721 

Total  to  aid  States,  Territories,  etc. 

402, 752 

238,  664 

164. 088 

To  Aid  Financial  Institutions 

Loans  to  banks; 

Federal  Savings  and  Loan  Insurance  Corporation.. 

45, 000 

45, 000 

Foreign  Loans 

Expansion  of  defense  production: 

Export-Import  Bank  of  Washington 

15,055 

13, 765 

34,415 

8,355 

15, 491 
134, 681 

3, 367, 699 

6 

15, 055 

Military  assistance— credit  sales: 
Defense  Department: 

Air  Force  Department        ... 

13,  765 
34,  415 
8,355 

15,  491 

Navy  Department -            -.    

Other  purposes: 

Commerce  Department: 

Development  Loan  Fund 

134, 681 

3,367,699 

6 

378, 862 

Export-Import  Bank  of  Washington: 
Regular  lending  activities 

Liquidation  of  certain  Reconstruction  Finance 
Corporation  assets 

Loans  to  United  States  firms  and  domestic  or 
foreign  firms  in  foreign  countries 

4  47, 186 

1, 768, 484 
3, 320, 222 

1, 768,  484 
3, 320, 222 

1, 886, 978 

Treasury  Department: 

Miscellaneous  loans  and  certain  other  assets 

Total  foreign  loans ' 

8, 678, 174 

3, 517. 442 

5, 160,  732 

2, 313, 026 

Footnotes  at  end  of  table. 
614359—62 48 


748   1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  126. — Statement  of  loans  outstanding  of  Government  corporations  and  certain 
other  business-type  activities,  June  30,  1961 — Continued 

[In  thousands  of  dollars] 

LOANS  OUTSTANDING,  EXCLUDING  INTERAGENCY  LOANS  AND  THOSE  MADE  BY 
DEPOSIT  AND  TRUST  REVOLVING  FUNDS  CLASSIFIED  BY  TYPES  OF  LOANS  '—Con. 


U.S.  dollar  loans 

Type  of  loan  and  lending  agency 

Total 

Public 
enterprise 
revolving 

funds 

Certain 

other 

activities 

Foreign 

currency 

loans  2 

Other  Loans 
Farm  Credit  Administration: 

2,191 

6,632 
81, 462 

173 

128,252 
2,311 

958, 048 
7,514 

43 
10, 347 

144 
428 

47, 826 

1,744 

47, 500 
823 

105 

729 
1,559 

52 
344 

92 

2,191 
6,632 

General  Services  Administration: 

Federal  Facilities  Cori)oration 

81, 462 

173 

128,252 
2,311 

Health,  Education,  and  Welfare  Department: 
Office  of  Education: 

Loans  to  students  in  institutions  of  higher 

Housing  and  Home  Finance  Administrator: 

958,048 
7,514 

Interior  Department: 

Bureau  of  Indian  Aflairs: 

43 

10, 347 

144 

428 

47, 826 
1,744 

Office  of  Territories: 

Public  Housing  Administralion  .      . ._  -  . 

Small  Business  Administration: 

Reconstruction  Finance  Corporation  liquidation 

State  Department: 

47, 500 
823 

105 

72  P 

Treasury  i:)epartnient: 

Veterans'  Administration: 

1,559 

52 

344 

92 



1, 298, 320 

1, 036, 922 

261, 398 

Total  loans  s 

«  22, 370, 127 

11,897,940 

10, 472, 187 

2,313,026 

'  In  accordance  with  an  amendment  issued  June  23, 1960,  to  Department  Circular  No.  966,  purchase  money 
mortgages  and  si  milar  long-term  paper  held  by  the  agencies  are  classified  as  loans  recei  vable  and  are  included 
in  this  table.  Prior  to  June  30, 1960,  tliese  assets  had  been  classified  as  accounts  and  notes  receivable  or  other 
assets. 

2  The  dollar  equivalents  of  these  loans  are  computed  for  reporting  purposes  at  varying  rates.  Where  the 
loan  agreements  stipulate  a  dollar  denominated  figure,  the  loans  outstanding  are  generally  valued  at  agree- 
ment rates  of  exchange.  Loans  executed  in  units  of  foreign  currency  are  valued  at  the  market  rates  (i.e., 
the  rates  of  exchange  at  which  the  Treasury  sells  such  currencies  to  Government  agencies). 

3  Includes  certificates  of  interest. 

*  Has  not  Ix'en  reduced  by  $i,960  thousand  representing  estimated  reserve  for  exchange  rate  adjustments. 

'  Excludes  World  War  I  funded  and  unfunded  indebtedness  of  foreign  governments,  and  World  War  II 
indebtedness  of  foreign  governments  involving  lend-lease  articles,  surplus  property  sales  agreements,  and 
certain  other  credits  shown  in  table  119. 

8  Does  not  include  foreign  currency  loans. 

Note.— For  explanation  of  reporting  coverage  see  note  to  table  125.  This  loan  table;  a  table  on  all  loans 
consisting  of  U.S.  dollar  loans,  foreign  currency  loans,  and  loans  made,  all  in  U.S.  dollars,  by  deposit  funds 
and  trust  revolving  funds;  and  detailed  statements  of  financial  condition  by  agencies  as  of  June  30,  1961, 
will  be  found  in  the  Treasurij  Bulletin  of  December  1961.  Detailed  statements  of  income  and  expense  and 
of  source  and  application  of  funds  by  agencies  as  of  June  30, 1961,  will  be  found  in  the  Treasury  Bulletin 
of  January  1962. 


TABLES 


749 


Table  127. — Dividends,  interest,  and  similar  earnings  received  by  the  Treasury  from 
Government  corporations  and  certain  other  business-type  activities,  fiscal  years 
1960  and  1961 


Agency  and  nature  of  earnings 


Amounts 


1960 


1961 


Atomic  Energy  Commission,  defense  production  guarantees,  earnings.  _. 

Civil  Service  Commission,  investigations,  earnings 

Commerce  Department: 

Defense  production  guarantees,  earnings 

National  Bureau  of  Standards,  worlfing  capital  fund,  earnings 

Maritime  Administration,  Federal  ship  mortgage  insurance  fund, 

interest  on  borrowings 

Commodity  Credit  Corporation: 

Interest  on  capital  stock 

Interest  on  borrowings 

Defense  Department: 

Army  Department,  defense  housing,  profits 

Navy  Department,  defense  housing,  profits.-- - 

Air  Force  Department,  industrial  fund,  earnings 

Export-Import  Bank  of  Washington: 
Regular  activities: 

Dividends - 

Interest  on  borrowings 

Liquidation  of  certain  Reconstruction  Finance  Corporation  assets: 

Earnings 

Interest  on  borrowings -.. 

Farm  Credit  Administration: 

Banks  for  cooperatives,  franchise  tax 

Federal  Farm  Mortgage  Corporation,  dividends 

Federal  intermediate  credit  banks,  franchise  tax 

Farmers'  Home  Administration: 

Loan  programs,  interest  on  borrowings 

Farm  tenant  mortgage  insurance  fund,  interest  on  borrowings 

Federal  National  Mortgage  Association: 

Management  and  liquidating  functions,  interest  on  borrowings 

Secondary  market  operations: 

Dividends 

Interest  on  borrowings 

Special  assistance  functions,  interest  on  borrowings 

Federal  Prison  Industries,  Inc.,  earnings 

General  Services  Administration: 

General  supply  fund,  earnings 

Buildings  management  fund,  earnings 

Working  capital  fund,  ea-nings 

Government  Printing  Olflce,  earnings 

Health,  Education,  and  Welfare  Department,  Social  Security  Admin- 
istration, operating  fund,  Bureau  of  Federal  Credit  Unions,  interest.. 
Housing  and  Home  Finince  Administrator: 

College  housing  loans,  interest  on  borrowings 

Public  facility  loans,  interest  on  borrowings 

Urban  renewal  fund,  interest  on  borrowings 

Interior  Department: 

Bureau  of  Reclamation: 

Colorado  River  Dam  fund,  Boulder  Canyon  project,  interest 

Upper  Colorado  River  Basin  fund,  earnings. 

Virgin  Islands  Corporation: 

Interest  on  appropriations  and  paid-in  capital 

Interest  on  borrowings 

International  Cooperation  Administration,  interest  on  borrowings 

Panama  Canal  Company,  interest  on  net  direct  investment  of  the  Gov- 
ernment...  _- 

Public  Housing  Administration,  low  rent  public  housing  program  fund, 

interest  on  borrowings 

Rural  Electrification  Administration,  interest  on  borrowings 

Saint  Lawrence  Seaway  Development  Corporation,  interest  on  borrow- 
ings. 


$7, 249.  08 

5, 882.  95 
247,908.11 

73, 881. 91 

2, 875, 000. 00 
461, 910, 614. 03 

450, 000.  00 

150, 000.  00 

11,612,643.09 


22, 500, 000. 00 
45, 385, 192. 80 


337, 149.  76 

1,  789, 849.  71 
1,700,000.00 
1, 695, 489.  99 

8, 763, 363.  74 
1,307,791.78 

29,  510, 768.  86 

2, 472, 500. 00 

5, 396,  520. 38 

41,238,875.74 

3, 000, 000.  00 

2,  531, 995.  68 
1, 099, 824. 13 

10,471.72 
4,351,127.20 

33.90 

14, 404, 921.  73 

967, 401. 28 

2,  514, 407. 17 


3, 071, 872.  90 
31, 812. 10 


Secretary  of  the  Treasury  (Federal  Civil  Defense  Act  of  1950,  as  amended), 

interest  on  borrowings 

Small  Business  Administration,  interest  on  appropriations 

Tennessee  Valley  Authority,  earnings 

United  States  Information  Agency,  informational  media  guaranty  fund, 
interest  on  borrowings -. 


108. 89 
20, 695, 856. 12 


9, 422, 781. 44 


1,331,801.53 
60, 356, 546.  06 


2, 504, 920.  56 


24,153.26 
6,  657, 359. 38 


$508,099.11 
1,368.87 


228, 299.  85 

54, 250. 00 

3, 500, 000.  00 
406, 074, 897. 12 

80, 000. 00 

300, 000.  00 

1, 816,  502. 97 


22,  500, 
42, 803, 

860, 
73, 

1, 527, 
1,  700. 
1, 128, 

11,612, 
1, 195, 


000. 00 
072. 29 

653.  52 
548.  23 

632.  86 
000.00 
892. 81 

573. 42 
868. 62 


27,  768, 315. 07 


3, 112, 

986, 

64, 147, 


445.  64 
051.  68 
173.  50 


1, 154,  594.  50 

1, 803, 809.  64 

6, 966.  51 

3, 000, 000.  00 


20,017,279.61 
1,594,232.01 
2, 914, 362.  22 


3, 113, 
1, 


396, 

1, 

19, 996, 


866. 35 
293. 00 

397.  61 
362.  76 
983.  81 


8,  780, 538.  55 


1, 102, 
64, 416, 


450.  67 
156. 12 


2, 000. 000.  00 


25, 
15,238, 
41, 432, 


293.  04 
423. 13 
397.  60 


413, 784. 00 


1, 064, 720. 00 


750 


1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Table  127. — Dividends,  interest,  and  similar  earnings  received  by  the  Treasury  from 
Government  corporations  and  certain  other  business-type  activities,  fiscal  years 
1960  and  1961 — Continued 


Agency  and  nature  of  earnings 

Amounts 

1960 

1961 

Veterans'  Administration: 

$465, 444.  00 
27, 000. 00 

$41,191.00 

10, 000.  00 

126, 973.  47 

Veterans'  direct  loan  program,  interest  on  borrowings  .    

23,  028, 174. 13 

631,972.57 

24,611,656.46 

4,948,175.85 

383, 334.  08 
4, 202, 448.  94 

31,990,233.05 

Defense  Production  Act  of  1950,  as  amended: 

E\port-Import  Bank  of  Washington,  interest  on  borrowings 

509,787.11 

General  Services  Administration,  interest  on  borrowngs 

781, 250.  01 

6,  942.  57 

Secretarj'  of  the  Interior  (Defense  IMinerals  Exploration  Administra- 

Secretary  of  the  Treasury,  interest  on  borrowings 

4, 842, 608.  02 

Total    - - 

831,120,067.01 

818, 350, 357.  92 

Table  128. — Restoration  of  amounts  of  capital  impairment  of  the  Commodity  Credit 
Corporation,  pursuant  to  the  act  of  March  8,  1938,  as  amended  ' 


Restoration  of  amounts  of  capital  impairment 

Surplus 

Appraisal  date 

Authorizing  act 

Appropriations 

Obligations 
canceled 

returned  to 
the  Treasury 

March  SI 
1938 

June  25,  1938  (52  Stat.  1148) 

Aug.  9,  1939  (53  Stat.  1325) 

$94, 285,  404.  73 
119,599,918.05 

1939 

1940    . 

$43,756,731.01 

1941 

July  3,  1941  (55  Stat.  563)    

1,  637, 445. 51 

1942 

27,  815,  513.  68 

1943 

JApr  25  1945  (59  Stat  90) 

256,764,881.04 

1944 

June  SO 
1945 

July  20,  1946  (60  Stat.  593) 

$921, 456,  561. 00 
641, 832, 080.  64 

1946 

Mav  26,  1947  (61  Stat.  109)     

1947 

17,  693,  492. 14 

1948 

48, 943, 010.  36 

1949 

Sept.  6,  1950  (64  Stat.  677) 

66,698,457.00 
421, 462,  507. 00 

1950 

Aug  31,  1951  (65  Stat.  244) 

1951 

July  5,  1952  (66  Stat.  354) 

109,391,154.00 

1952 

.July  28,  1953  (67  Stat.  222) 

96,205,161.00 
550, 151, 848. 00 

1953 

Feb.  12,  1954  (68  Stat.  14)   . 

1954 

May  23,  1955  (69  Stat.  60) 

i,  634,  659. 66 

929,  287, 178. 00 

1, 239,  788.  671.  00 

1,  760,  399, 886. 00 

1,  435,  424,  413. 00 

100, 000, 000.  00 

575, 000, 000. 00 

632, 000, 993. 32 

594, 499, 006.  68 

1, 017,  610, 000. 00 

1955 

June  4,  1956  (70  Stat.  238) 

1956 

Aug.  2,  1957  (71  Stat.  338) 

1957 

June  13,  1958  (72  Stat.  198) 

/July  8,  1959  (73  Stat.  177)    . 

1958 

1  A.pr   13   1960  (74  Stat  42) 

/Apr!  13^  1960  (74  Stat!  42)11 1 

1959 

IJune  29,  1960  (74  Stat.  242).. 

/June  29,  1960  (74  Stat.  242). 

\July  26  1961  (75  Stat  238) 

1960 

Total 

8,  867, 323, 610. 33 

2,  697, 806,  614.  64 

138, 208, 747. 19 

Total  restoration  of  amounts  of  capital  impau-ment $11,  565, 130,  224.  97 

Less  surplus  returned  to  the  Treasury .- 138, 208, 747. 19 

Net  charge  to  Treasury  to  restore  amounts  of  capital  impairment 11, 426, 921, 477. 78 


1  Does  not  include  reimbursements  to  the  Corporation  under  programs  for  which  appropriations  were 
authorized  by  specific  legislation.  The  act  of  March  8,  1938,  as  amended  (15  U.S.C.  713  a-1),  provided 
for  an  annual  appraisal  of  the  assets  and  liabilities  of  the  Corporation  by  the  Secretary  of  the  Treasury 
and  the  restoration  of  amounts  of  capital  impairment.  An  act  approved  August  17,  1961  (75  Stat.  391) 
relieved  the  Secretary  of  the  Treasury  from  making  further  appraisals  beginning  with  the  fiscal  year 
ended  June  30, 1961. 


TABLES 


751 


Government  Losses  in  Shipment 

Table  129. — Government  losses  in  shipment  revolving  fund,  June  30,  1961 

[Established  July  8,  1937,  under  authority  of  the  Government  Losses  in  Shipment  Act,  as  amended  (5 

U.S.C.  134-134h)] 

SECTION  I.— STATUS  OF  FUND 


Transactions 

Cumulative 

through 
June  30,  1960 

Fiscal  year  1961 

Cumulative 

through 
June  30, 1961 

Receipts: 

Appropriation. 

$802, 000. 00 
91,  803. 13 

50, 000. 00 

$802,000.00 
91  803  13 

Transferred  from  securities  trust  fund: 
Public  Law  378.- 

Transferred  from  the  account  "Unclaimed  Partial 
Payments  on  United  States  Savings  Bonds": 
Public  Law  85-354 

50, 000. 00 

Public  Law  86-561 

$100,  000. 00 
172. 15 

100, 000. 00 

Recoveries  of  payments  for  losses 

481,  032.  34 
3,  924.  32 

481  204  49 

3,  924. 32 

Total  receipts 

1,  428,  759.  79 

100, 172. 15 

1,  528,  931.  94 

Expenditures: 

Payment  for  losses 

1, 350.  997. 93 

92.57 

86,  265.  54 

1,  437,  263. 47 

Other  payments  (refunds,  etc.)       

92.57 

Total  expenditures    .  

1,  351,  090.  50 

86,  265.  54 

1,  437,  356.  04 

Balance  in  fund. 

77,  669.  29 

13.  906.  61 

91  575  90 

SECTION  II.— AGREEMENTS  OF  INDEMNITY  ISSUED  BY  THE  TREASURY 

DEPARTMENT  i 


Agreements  of  indemnity 

Number 

Amount 

Issued  through  June  30,  1960 

414 
9 

$2,  704,  063.  40 

Issued  during  the  fiscal  year  1961 

22,  915.  69 

Total  issued ... 

423 
29 

2,  726,  979.  09 

Canceled  through  June  30, 1961 

1,  027, 879.  87 

In  force  as  of  June  30,  1961 

394 

1,  699, 099  22 

SECTION  III.— CLAIMS  MADE  AND  SETTLED 


Claims 


Number 


Amount 


Received: 

Through  June  30,  1960 

During  fiscal  year  1961  and  processed  by: 

Bureau  of  Accounts 

Bureau  of  the  Pubhc  Debt 

Total  claims  received  through  June  30,  1961 

Settled: 

Through  June  30,  I960.- 

During  fiscal  year  1961  and  processed  by: 

Bureau  of  Accounts: 

For  payment  out  of  the  fund 

For  credit  in  appropriate  accounts 

Without  payment  or  credit - 

Bureau  of  the  Public  Debt,  for  payment  out  of  the  fund: 

U.S.  savings  bonds  redemption  cases 

Armed  Forces  leave  bonds  redemption  cases 

Total  claims  settled  through  June  30, 1961 

Unadjusted  as  of  June  30, 1961 « 

Total 


6,201 

117 
95 


6,413 


$7, 177,  956.  25 


124,071.11 

72,  454.  88 


6,413 

7, 374,  482.  24 

6.179 

7, 140,  652.  51 

19 

97 

2 

12,  299.  95 

123,  621.  72 

291.  22 

95 
4 

73, 062.  27 
903.  32 

6,396 
17 

7,  350.  830. 99 
23,  651.  25 

7,  374,  482.  24 


'  The  Government  has  not  sustained  any  actual  monetary  loss  in  connection  with  its  liability  under 
these  agreements  of  indemnity. 
'  Includes  claims  in  process  of  adjustment  by  the  Bureau  of  the  Public  Debt. 


752    1961  REPORT  OF  THE  SECRETARY  OF  THE  TREASURY 


Personnel 

Table  130. — Number  of  employees  in  the  departmental  and  field  services  of  the 
Treasury  Department,  quarterly  from  June  30,  1960,  to  June  SO,  1961  ' 


Organization  unit 

June  30, 
1960 

Sept.  30, 
1960 

Dec.  31, 
1960 

March  31, 
1961 

June  30, 
1961 

Increase, 
or  de- 
crease 
(— ),  since 
June  30, 
1960 

Office  of  tlie  Secretary 

452 

1,170 

8,357 

16 

3,191 

2,186 

2,291 

960 

50, 199 

135 

824 

421 

4,790 

520 

667 

446 

1,192 

8,380 

15 

3,149 

2,126 

2,282 

949 

51,  445 

134 

837 

410 

4,  765 

517 

671 

447 

1,195 

8,375 

12 

3,117 

2,188 

2,277 

949 

50,  906 

135 

860 

424 

4,670 

511 

670 

443 

1,205 

8,468 

12 

3,078 

2  2,  208 

2,264 

949 

2  55,  418 

134 

919 

413 

4,736 

507 

666 

506 

1,221 

8,553 

12 

3,038 

2,159 

2,237 

993 

53,  680 

132 

927 

417 

4,916 

506 

673 

54 

Comptroller  of  Currency,  Bureau  of. 

51 
196 

Defense  Lendin?,  Office  of    

—  4 

En^ravini  and  Printing,  Bureau  of. 
Fiscal  Service: 

Accents,  Bureau  of    

-153 
-27 

Public  Debt,  Bureau  of 

—54 

33 

Internal  Revenue  Service.. 

3,481 

International  Finance,  Office  of 

-3 

103 

Narcotics,  Bureau  of 

-4 

U.S.  Coasst  Guard     -.- - 

126 

U.S.  Savings  Bonds  Division 

U.S.  Secret  Service      

-14 
6 

Total  civilian  employees 

Military    employees— U.S.     Coast 
Guard  

76, 179 
30,  616 

77,  318 
30, 976 

76,  736 
31,091 

81,  420 
31, 419 

79, 970 
31,  520 

3,791 
904 

Grand  total 

106,  795 

108, 294 

107, 827 

112, 839 

111,490 

4,695 

1  Actual  number  of  employees  on  the  last  day  of  the  month  and  any  intermittent  employees  who  worked 
at  any  time  during  the  month. 
i  Includes  seasonal  employees. 


INDEX 


[Note. — The  years  unless  otherwise  indicated  refer  to  the  fiscal  years  ended 

June  30] 

Account  of  the   Treasurer  of  the   United  States.    See  Treasurer  of  the 

United  States. 
Accounting  and  financial  reporting,  Government:  Paee 

Bases  of  accounts  and  reports 403 

Cash  operations,  description  of  accounts  relating  to 406 

Central  accounting  and  reporting  developments 165-167 

Changes 64,  67,  70,  108,  109,  119,  164-169,  341,  476,  487,  488 

Foreign  currencies,  accounting  control 167 

Narcotics,  Bureau  of,  changes 213 

Publications 79,  166,  403 

Revised  procedures  and  legislation  relating  to 164-169 

Accounts,  Bureau  of 140,  164-177,  446,  752 

Act  of  Bogota 357-363 

Adjusted  service  certificate  fund 510,  638 

Administration,  Treasury  Department 42-44,  139-141 

Administrative  accounts  and  reports,  basis  for  certain  tables 405 

Administrative  budget 6-12 

Administrative  and  staff  officers  of  Treasury  Department,  January  8, 

1962 48 

Admissions  tax 485,  493 

Advance  refunding 15,  17,  84-87,  90-94,  246 

Aged,  health  insurance,  proposal 107,  487 

Agency  for  International  Development  {see  also  Development  Loan  Fund; 
International  Cooperation  Administration) : 

Establishment  and  purpose 31,  40,  124 

Lending  provisions 124 

Agricultural  adjustment  taxes    1934-36 495 

Agricultural  commodities  (surplus) : 

Barter  arrangements  reexamined 31 

Distributed  within  States,  values  of 684 

Foreign  currencies  derived  from  sale  of 167,  724 

Agricultural  conservation  program  expenditures 430 

Agricultural  Marketing  Service  expenditures 430 

Agricultural  Research  Service  expenditures 430 

Agricultural  Stabilization  and  Conservation  Service  expenditures 430 

Agricultural  Trade  Development  and  Assistance  Act  of  1954,  loans 39, 

124,  127,  724,  730 
Agriculture  and  agricultural  resources,  expenditures: 

1953-61 479 

1957-61 72 

Agriculture,  Department  of: 
Expenditures: 

1960  and  1961  and  monthly  1961 430 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 679 

States  and  local  units 675 

1961  payments  by  States  and  programs  for: 

Individuals,  etc 693 

States  and  local  units 683 

753 


754  INDEX 

Agriculture,  Department  of — Continued  Page 

Interfund  transactions  1940-61 452 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Trust  account  receipts  and  expenditures  1960  and  1961  and  monthly 

1961 462,466 

Trust  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 467,477 

Agriculture,  loans  to  aid 746 

Ainsworth  Library  fund,  Walter  Reed  General  Hospital 638,  642 

Air  Force,  Department  of: 

Cadet  fund 640 

Defense  production  guarantees 746 

Expenditures: 

1949-61 415 

1960  and  1961  and  monthly  1961 434-439 

Federal  aid  to  States  for  payments  to  individuals,  etc.,  for  Air 
National  Guard: 

1950  and  1961  by  appropriation  titles 680 

1961  payments  by  States 693 

General  gift  fund 640 

Industrial  fund  earnings  paid  to  Treasury 749 

Intragovernmental  fund  receipts  and  expenditures  1960  and  1961 436 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 459 

Aircraft  and  passengers  entering  United  States 708 

Airport  program,  Federal 679,  691 

Alaska  International  Rail  and  Highway  Commission  expenditures 422 

Alaska  Railroad  revolving  fund 442,  459 

Alcohol  taxes 65,67,  104,  195,  198,484,491 

Alien  property  trust  fund 639 

AUiance  for  Progress  (see  also  Latin  America) 40,  115,  124,  357,  360 

American  Battle  Monuments  Commission  expenditures 422 

American-Mexican  Claims  Commission 714 

American  Printing  House  for  the  Blind  expenditures 440,  676,  685 

American  States,  Organization  of  {see  also  Latin  America) 124,  125,  358,  361 

Anglo-American  Financial  Agreement  of  1945,  payment  of  principal  and 

interest 173 

Apprenticeship  and  Training,  Bureau  of,  expenditures 442 

Argentina  exchange  agreement  and  standby  arrangement 121,  388 

Armed  services  housing  mortgage  insurance  fund 511,  513,  530,  537,  561,  638 

Armory  Board  stadium  bonds.    See  District  of  Columbia. 
Army,  Department  of: 

Central  hospital  fund,  Office  of  Surgeon  General,  investments  made 

by  Treasury  1952-61 639 

Defense  housing  profits  paid  to  Treasury 749 

Defense  production  guarantees 746 

Expenditures: 

1789-1961 411 

1960  and  1961  and  monthly  1961 434-439 

FcdGrOjl  fiid  to  StRtcs* 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 680 

States  and  local  units 675 

1961  payments  by  States  for: 

Indi\'iduals,  etc.,  for  National  Guard 693 

States  and  local  units  for  lease  of  flood  control  lands 685 

General  gift  fund 640 

Intragovernmental  fund  receipts  and  expenditures  1960  and  1961 436 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 436,459 


INDEX  755 


Assistant  Secretaries  of  the  Treasury :  Pag© 

1961,  January  21-1962,  January  8 47 

Statements  by: 

Leddy,  J.  M.,  September  21,  1961,  on  the  annual  report  of  the 

International  Finance  Corporation 384 

Surrey,  S.  S.,  July  25,  1961,  before  the  Senate  Finance  Committee 

on  voluntarj'  pension  plans  by  the  self-employed 344 

Upton,  T.  Graydon,  August  15,  1960,  before  the  Senate  Foreign 
Relations   Committee  on  the   President's  proposal  for   Latin 

America 385 

Atomic  Energy  Commission: 

Earnings  paid  to  Treasury 749 

Expenditures: 

1953-61 478 

1960  and  1961  and  monthly  1961 422 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States  for  pajanents  to  individuals  for  fellowships 

and  assistance  to  schools  by: 

Appropriation  title 681 

States 697 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Automatic  data  processing..  25,  43,   44,  105,  139,  160,  169,  175,  178,  181,  182, 

186,  187,  196,  200,  202,  209,  213,  226,  311,  340 

Automobiles,  trucks,  tires,  inner  tubes,  etc.,  taxes 67 

70,    104,    108,   484,   492 

Aviation  fuels  tax 68,  103,  104,312,339,344 

Awards  program  for  suggestions  by  employees 139, 

141,  157,  161,  175,  179,  186,  209,  213,  222 

B 
Balance  of  payments,  U.S.: 
Analyses  of  situation: 

1951-56 352,  364 

1957-61 352,  364,  365 

1958-60 379 

1960 350,352,382 

1961: 

Calendar 27-38,  382 

Fiscal 117,  374,  382 

1962  prospects 38 

Basic 117,  118,350,365,374,379,382 

Capital  movements,  reporting  by  the  Treasury 119 

Committee  on  Balance-of- Payments  Information 374 

Deficit: 

Amounts,  total 28,  117,  118,  352,  382 

Basic  accounts 28,  117,  118,  353,  365,  374,  382 

Measures  to  reduce,  proposed  or  taken: 

Balanced  budget 11,  32,  382 

Customs  duty  exemption  reduction,  U.S.  citizens 158,  353,  365 

Export  insurance  and  credit  guarantees 34,  127,  348,  353,  365 

Foreign  countries: 

Debt  prepayments 28,  38,  121,  133,  382 

Organization  for  Economic  Cooperation  and  Develop- 
ment  36,  121,131,349,353,365,377 

Role 27,  35,  39,  350,  353,  376,  383 

Foreign  exchange,  acquisition  of  convertible  currencies 121,  378 

Forward  exchange  market  operations 37,  121,  377 

Gold  holdings  of  U.S.  citizens  and  enterprises  abroad  pro- 
hibited         120 

Interest  rates 14,  19,  20,38,354-356,376 

International     Monetary    Fund,    supplementary    resources 

proposal 37,  39,  116,  353,  383 


756  INDEX 

Balance  of  payments,  U.S. — Continued 
Deficit — Continued 

Measures  to  reduce,  proposed  or  taken — Continued  Page 

Objectives  and  means,  overall 11,  2-3.  27,  29,  30-39,  115, 

120,  121,  348,  352,  353,  365,  375,  376,  382 

President's  program 27,  30,  115,  350,  352,  353,  365,  374,  375,  376 

Tariff  bargaining  authority  "proposal 36,  39 

Tax  policies  {see  also  Taxation) 4.  23,  24,  29,  33.  37,  39, 

306,  308,  313,  320,  325,  329,  330,  353,  356,  365,  366,  376 

Visa  requirements  for  foreign  tourists  simplified 35,  39,  353,  365 

Foreign  aid  relationship 31,  118,  353,  365,  370,  376 

Foreign  exchange  reporting  by  the  Treasury 119 

Gold  and  dollar  movements,  U.S 27,  28.  30,  38,  117, 

119,  120,364,365,37.5,379 

Merchandise  accounts 28,  29,  38,  117,  366,  374,  379,  382 

Policy 11,  23,  27-39,  118,  133,  348,  350,  352,  353,  365,  374-376 

Private  investment  abroad,  U.S 118,366  375,379 

Problem,  nature  of 3,  6,  11,  14,  19,  27-29,  36, 

114,  117,  323,  325,  329,  350,  352,  364,  376 

Short-termncapital  flows 14,  28, 

'^  ;^         .  ,«   .    .  ...  ^     30,  36-38,  117,  119,  120,  350,  352-354,  364,  366,  374-382 

Unrecorded  transactions 375,  379 

Banking  system,    governmental   security   holdings    (see  also   Commercial 
banks;  Federal  Reserve  Banks;  National  banks): 
Federal  securities: 

1941-61,  June  30 98 

1952-61,  June  30 625 

1961,  ownership  changes 97,  101 

Nonguaranteed    securities    of    Federal    instrumentalities,    June    30, 

1952-61 625 

State,  local,  and  territorial  government  securities,  June  30,  1952-61_-       625 
Banks.     »See  Specific  classes. 
Banks  for  cooperatives: 

Capital  stock  owned  by  United  States  and  repayments  1961 736 

Debentures,  engraved,  printed,  and  delivered 711 

Franchise  tax  paid  to  Treasury 749 

Investment  fund,  receipts  and  expenditures  1960  and  1961 424,  458 

Investments: 

1952-61 640 

1960  and  1961 472 

Obligations : 

Market  transactions  (net)  1960  and  1961 474 

Outstanding  1953-61 514 

Bases  of  tables,  explanation 403-407 

Beer  tax 104,  484,  491 

Bills,  Treasury: 

Engraved,  printed,  and  delivered 711 

Interest  (discount) : 

Computed  charge  and  rate,  June  30,  1939-61 618 

Computed  rate 516 

Expenditures  1957-61 620 

Rates 266 

Limitation,  statutory,  application 541 

Matured,  outstanding  June  30,  1961 534 

Other  than  regular  weekly  and  tax  anticipation  series: 

Allotments  by  investor  classes 95,  604 

Exchanges 544,  548 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,  548 

1961 89,  91, 

92,  93,  94,  264,  269,  554,  571,  574,  581,  589,  596 
Calendar  1961 15 


INDEX  757 

Bills,  Treasury — Continued 

Other  than  regular  weekly  and  tax  anticipation  series- — Continued 

Outstanding:  Page 

1960  and  1961,  June  30 82,  510,  554,  570,  628 

1961,  June  30 516,518 

Calendar  1961 15 

Ownership: 

Changes 101 

Summary  by  investor  classes 628 

Pressreleases,  April  15,  1961  issue 264,265 

Prices  and  rates 266 

Regular  weekly  series  (see  also  Strip  bills) : 

Allotments  by  investor  classes 95 

Exchanges 544,  548,  574-602 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,  548 

1961 83,  91-93,  258,  260,  266,  554,  570,  574-602 

Calendar  1961 15,  17 

Outstanding: 

1952-61,  June  30 510 

1960  and  1961,  June  30 82,  554,  570,  628 

1961,  June  30 516,  518 

Calendar  1961 15 

Description 518 

Ownership: 

Changes 101 

Summary  by  investor  classes  1960  and  1961 628 

Press  releases: 

June  14,  1961,  strip  issues 260,  261 

June  15,  1961,  issues 258,  259 

Strip  bills: 

Allotments  by  investor  classes 95,  604 

Issues  1961  and  calendar  1961 17, 

83,  92,  93,  95,  260-262,  268,  520,  555 
Outstanding: 

1961,  June  30 555 

Description 520 

Technique  innovation 15,  17,  83,  87,  92 

Summary  of  1961  issues 266 

Tax  anticipation  series: 

Allotments  by  investor  classes 95,  604 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,  548 

1961 89,  91-94,  262,  269,  555,  570,  574,  582,  594,  595,  601 

Outstanding: 

1953,  1957,  1959,  and  1961,  June  30 510 

1960  and  1961,  June  30 570 

1961,  June  30 82,  516,  519,  555,  628 

Calendar  1961 15 

Ownership : 

Changes 101 

Summary  by  investor  classes 628 

Press  releases,  April  3,  1961  issue 262,  263 

Bogota,  Act  of 358,360,362,363 

Bond  and  stock  transfers,  security  issues,  and  deeds  of  conveyance,  etc., 

taxes 484 

Bonds  and  notes,  U.S.  Government,  holdings  of  foreign  countries 119,  718 

Bonds,  Armory  Board  stadium.     See  District  of  Columbia. 
Bonds,  U.S.  Government: 

Adjusted  service  (matured) : 

Issues  (adjustment)  1961 544 

Outstanding  June  30: 

1960  and  1961 565 

1961 534 


758  INDEX 

Bonds,  U.S.  Government — Continued  ~^      "^ 
Adjusted  service  (matured) — Continued 

Redemptions :  Page 

1952-61 504 

1960  and  1961  and  monthly  1961 _  548 

1961 565 

Armed  Forces  leave  (matured) : 

Outstanding  June  30: 

1960  and  1961 565 

1961 534 

Redemptions: 

1952-61 504 

1960  and  1961  and  monthly  1961 548 

1961 565 

Bank  eligible  bonds.     See  Bonds,  U.S.  Government,  Treasury. 
Bank  restricted  bonds.     See  Bonds,  U.S.  Government,  Treasury. 
Depositary: 

Bank  holdings  June  30,  1960  and  1961 628 

Engraved,  printed,  and  delivered 711 

Interest: 

Computed  rate 516 

Expenditures  1957-61 620 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,  548 

1961 560,  576-603 

Outstanding: 

1952-61,  June  30 510 

1960  and  1961,  June  30 97,  560,  628 

1961 516,523 

Description 523 

Limitation,  statutory,  appUcation 541 

Excess  profits  tax  refund  (matured) : 

Outstanding: 

1952-61,  June  30 512 

1960  and  1961,  June  30 573 

1961,  June  30,  and  description 534 

Limitation,  statutory,  application 541 

Redemptions: 

1952-61 501,506 

1960  and  1961  and  monthly  1961 548 

1961 573 

Investment  series.  Treasury  bonds: 

Exchanges 93,  96,  550,  576-603 

Interest: 

Computed  rate 516 

Expenditures  1957-61 620 

Outstanding: 

1952-61,  June  30 510 

1960  and  1961,  June  30 97,  560,  628 

1961,  June  30 516,  523 

Description 523 

Limitation,  statutory,  application 541 

Ownership: 

Changes 101 

Summary  by  investor  classes  1960  and  1961 628 

Redemptions: 

1960  and  1961  and  montlily  1961 548 

1961 96,  560,  576-603 

Postal  Savings  Systems  holdings 96 

Liberty,  outstanding  June  30,  1960  and  1961,  and  redemptions  1961_  563 
Panama  Canal: 

lg  Engraved,  printed,  and  delivered 711 

Outstanding  June  30: 

1952-60 510 

1960 82,558,628 


INDEX  759 

Bonds,  U.S.  Government — Continued 

Panama  Canal — Continued  Page 

Ownership  by  investor  classes  1960 628 

Postal  savings  (matured) : 
Outstanding  June  30: 

1952-55 510 

1960  and  1961 563 

1961 ::       534 

Redemptions  1961 563 

Rural  Electrification  Administration  series: 
Interest: 

Computed  rate 516 

Expenditures  1961 620 

Issues  and  redemptions: 

1961 96,  544,  549,  560,  576-603 

Circular  on  July  1,  1960,  issue 243 

Outstanding: 

1961,  June  30 97,  510,  516,  523,  560,  628 

Description 523 

Limitation,  statutory,  application 541 

Savings : 

Advertising  donated 223 

Audit  of  retired 181,  182 

Denominations  of  E  and  H,  sales  and  redemptions '  614 

Duplicate  bond  applications 184 

Engraved,  printed,  and  delivered 711 

Exchanges: 

Series  E,  F,  and  J  for  Series  H 224,  550 

Series  F  and  G  for  marketable  notes 551 

Series  F  and  G  for  marketable  Treasury  bonds 17, 

91,  96,  250,  252,  254,  256,  550,  586,  590,  592,  594 

Series  H 544 

Extension  terms,  improvement 18,  97,  223 

Interest  or  accrued  discount: 

1942-61  and  monthly  1961 610 

1960  and  1961  and  monthly  1961 544,  548 

Checks  issued  on  Series  H  bonds '  184 

Computed  charge  and  rate  June  30,  1939-61 618 

Computed  rate 516 

Expenditures  1957-61 620 

Increased  rates  and  yields 18,  97,  223,  274-292 

Tax  deferral  on  exchanges  of  accrual-type  for  current  income.       224 
Issues : 

1935-61 609 

1941-61 524,  610 

1960  and  1961  and  monthly  1961 544 

1961 180,  558,  575-603 

Series  E  and  H 224,  609,  610,  614,  615 

Series  E  through  K  by  series  1941-61  and  monthly  1961. _  609,  610 

Issuing  and  paying  agents  for  Series  A-E 184 

Limitation  on  purchases,  change 18 

Lost,  stolen,  or  destroyed,  application  for  duplicates 184 

Objectives  of  sale 224 

Outstanding: 

1941-61,  June  30 610 

1952-61,  June  30 510 

1960  and  1961,  June  30 97,  558,  565,  628 

1961,  June  30 181,  183,  516,  524 

Calendar  1961 15 

Description 524 

Limitation,  statutory,  application 541 

Matured 534,  565 

Series  E  and  H 224,  610 

Series  E  through  K  by  series  1941-61  and  monthly  1961 610 


760  INDEX 

Bonds,  U.S.  Government — Continued 
Savings — Continued 

Ownership:  Page 

Changes 98,  101 

Summary  by  investor  classes  1960  and  1961 628 

Payroll  savings  plan: 

Companies  operating 184 

Effectiveness 224 

Punch-card  form,  Series  E,  registering  and  accounting  operations.        178 

Records  of  sales  and  redemptions 181 

Redemption  values,  Series  E 275-292 

Redemptions: 

1935-61 609 

1941-61 524,  610 

1960  and  1961  and  monthly  1961 548 

1961 180,  558,  565,  575-603 

Series  E  and  H 224,  609,  610,  614 

Series  E  through  K  by  series  1941-61  and  monthly  1961 609,  610 

Regulations  amended 274-293 

Series  E  new  terms  and  conditions 18,  97,  274-293 

Series  H  maturity  extension 18 

State  sales  of  Series  E  and  H 615 

Stocks,  authorized  use  of  existing 396 

Thrift  promotion 224 

Treasury: 

Allotments  by: 

Federal  Reserve  districts 256 

Investor  classes 95,  604 

Bank  eligible,  outstanding  June  30,  1952-61 510 

Bank  restricted,  outstanding  June  30,  1952-54 510 

Engraved,  printed,  and  delivered 711 

Exchanges 17, 

90,  91,  94,  241,  242,  248,  254,  256,  257,  544,  548,  576-602 
Interest: 

Computed  charge  and  rate  June  30,  1939-61 618 

Computed  rate 516 

Expenditures  1957-61 620 

Issues: 

1961 90, 

91,  93,  243,  254,  256,  257,  544,  557,  576-602 

Calendar  1961  and  1962 16-18 

Circular  on: 

October  1 ,  1 957  issue,  additional 250 

February  14,  1958  issue,  additional 246 

June  23,  1960  issue,  additional 244 

November  15,  1960  issue 248 

Summary  of  information  in  circulars 254 

Outstanding  June  30: 

1952-61 510 

1960  and  1961 82,  557,  564,  628 

1961 516,521,534 

Description 521 

Limitation,  statutory,  application 541 

Matured 564 

Ownership: 

Changes 101 

Summary  by  investor  classes  1960  and  1961 628 

Prices  and  yields: 

1941-61,  monthly  and  annual  averages 622 

1960  and  1961,  June  30,  and  price  range  since  first  traded.  _       623 
Redemptions: 

1960  and  1961  and  monthly  1961 548 

1961 94,  557,  564,  576-602 

Special  issues.     See  Trust  Account  and  other  transactions. 


INDEX  761 

Page 

Bonneville  Power  Administration  expenditures 440 

Bowling  alleys  and  billiard  and  pool  tables,  taxes 486 

Brazil: 

Exchange  agreement  and  standby  arrangement 122 

Financial  negotiations  with  the  United  States 368 

Budget  (see  also  Expenditures;  Receipts;  Surplus  or  deficit): 

1953-61  chart 63 

Accounting  concepts,  explanation 6 

Accounts,  explanation 406 

Administrative  budget  1961,  1962,  1963 6,  8,  9,  11 

Cash  budget  (see  also  Cash  income  and  outgo)  1961,  1962,  1963_    6,  8,  10,  12 
Estimates  1962  and  1963: 

Expenditures 72-73,  299,  486 

Receipts 67-70,  299,  484 

Receipts  and  expenditures 5,  8-12,  64,  70,  418,  478,  484 

Results  1960  and  1961 63 

Budget  and  Accounting  Procedures  Act  of  1950  authorizations 165,  404 

Budget,  Bureau  of,  expenditures 422 

Budgetary  Appropriations,  and  other  Authorizations,  Expenditures  and 

Unexpended  Balances 167 

Building  and  savings  and  loan  associations,  agents  for  Series  A-E  savings 

bonds 184 

Bulgarian  claims  fund 715 

Bullion  charges,  receipts 485 

Business  and  Defense  Services  Administration  expenditures 432 

Business  and  store  machines,  tax 484,  492 

Business  Economics,  Office  of,  expenditures 432 

C 

Cabarets  tax 485,  493 

Canada: 

Joint  United  States-Canadian  Committee  on  Trade  and  Economic 

Affairs 133 

United  States-Canada  Ministerial  Committee  on  Joint  Defense 133 

U.S.  private  investment 131 

Canal  Zone: 

Government  expenditures 438 

Governor  to   administer  laws   and  regulations  relating  to   narcotic 

drugs 398 

Postal  Savings  System: 

Deposits  June  30,  1946-61 539 

Investments  1952-61 639 

Treasury  notes  issued  to: 

Issues  and  redemptions 551 

Outstanding  June  30,  1952-57  and  1959 510 

Capital  movements,  reporting  by  the  Treasury 119 

Capital  stock  tax 490 

Cash  deposits  and  withdrawals,  Treasurers,  account 188 

Cash  Division,  Treasurer  of  the  United  States,  checks,  etc.,  deposited  for 

collection 191 

Cash  held  outside  the  Treasury,  change  in  balance: 

1952-61 500 

1961  and  estimate  1962 489 

Cash  income  and  outgo  (see  also  Budget,  Cash  budget)  1952-61 500 

Cash  operating  balances 302 

Cash  operations,  description  of  accounts  relating  to 406 

Census,  Bureau  of,  expenditures 432 

Central  accounting  and  reporting.     See  Accounting  and  financial  report- 
ing, Government. 

Central  Intelligence  Agency  construction  expenditures 422 


762  INDEX 

Centrarreporting.     See  Accounting  and  financial  reporting,  Government. 
Certificates  of  indebtedness:  Page 

Engraved,  printed,  and  delivered 711 

Interest: 

Computed  charge  and  rate,  June  30,  1942-61 618 

Computed  rate 516 

Expenditures  1957-61 620 

Outstanding: 

1952-61,  June  30 _  510 

1960  and  1961,  June  30 628 

1961,  June  30,  matured 534 

Limitation,  statutory,  application 541 

Ownership: 

Changes 101 

Summary  by  investor  classes  1960  and  1961 'i  ■: 628 

Prices  and  yields,  June  30,  1960  and  1961 624 

Regular  series: 

Exchanges.. _  94,  241,  242,  254,  256,  544,  548,  576,  584,  591,  592,  598,  599 
Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,548 

1961 16,  90,  92,  93,  233,  237,  520,  556,  569,  576,  584,  591, 

592,  598,  599,  602,  656 
Allotments  by: 

Federal  Reserve  districts 237 

Investor  classes 95,  604 

Circular  on  August  15,  1960,  issue 233 

Summary  1961 236 

Outstanding: 

1960  and  1961,  June  30 82,  556,  569 

1961,  June  30 516,  520 

Description 520 

Special  series 171,  527,  643,  650,  652,  654,  655,  660,  667,  670 

Tax  anticipation  series  (matured): 

Outstanding,  June  30,  1960  and  1961 569 

Redemptions  1960  and  1961  and  monthly  1961 549 

Charts: 

Budget,  1953-61 63 

Cumulative  remittances  to  United  States  from  net  earnings  of  a  U.S. 

foreign  subsidiary 325 

Organization  of  Treasury  Department,  December  1,  1961 46 

Public  debt: 

1916-61 81 

1946  and  1961,  changes  in  a  growing  economy 83 

1953-61  average  yield  trends  of  securities 88 

Advance  refunding 87 

Market  yields  by  selected  dates 355 

Maturity  distribution 85 

Ownership 99 

Structure  June  30,  1961 84 

Check  forgery  insurance  fund 191,  446,  459 

Checks: 

Claims  involving 191 

Disbursing  officers'  accounts 190 

Foreign,  withheld  in  certain  areas 176 

Issued  by  Division  of  Disbursement,  unit  cost 169 

Outstanding,  clearing  account 408,  489 

Paid  by  Treasurer  of  United  States 191 

Payment  and  reconciliation  program 186 

Chile,  exchange  agreement  and  standby  arrangement 122,  388 

China  (Communist) ,  foreign  assets  control 135,  205 

Cigar  taxes 484,  491 

Cigarette  papers  and  tubes,  taxes 484 

Cigarette  taxes 104,  484,  491 


INDEX  763 

Circulars,  Department,  Nos.:  Page 

653,  revision,  March  21,  1961,  Series  E  savings  bonds 274 

750,  amendment.  May  16,  1961,  regulations  governing  redemption  of 

U.S.  savings  bonds 293 

1008,  revision,  August  5,  1960,  U.S.  savings  stamps 293 

1046,  June  27,  1960,  Rural  Electrification  Administration  bonds 243 

1048,  August  1,  1960,  certificates  of  indebtedness.  Series  C-1961 233 

1049,  August  1,  1960,  Treasury  bonds  of  1968 _  244 

1051,  September  12,  1960,  Treasury  bonds  of  1990 246 

1053,  October  31,  1960,  Treasury  notes,  Series  F-1962 237 

1054,  October  31,  1960,  Treasury  bonds  of  1966 248 

1056,  November  18,  1960,  Treasury  bonds  of  1969 250 

1057,  February  6,  1961,  Treasury  notes.  Series  G-1962 239 

Circulation  Statement  of  United  States  Money 185,  632 

Civil  Aeronautics  Board  expenditures 73,  424,  486 

Civil  and  Dei  ..se  Mobilization,  Office  of 422,458,685 

Civil  defense 158,  446,  455,  459,  747 

Civil  Rights,  Commission  on,  expenditures 424 

Civil  Service  Commission  (see  also  Federal  employees): 

Earnings  paid  to  Treasury 749 

Expenditures 73,  424,  486 

Investments  1956-61 638 

Civil  service  retirement  and  disability  fund: 

Certificates  of  indebtedness  and  Treasury  notes  and  bonds: 

Description 527 

Interest  rate: 

Computed 516 

Statutory  change 75,  171 

Investments 472,  638,  643 

Issues  and  redemptions 546,  550,  560 

Outstanding 510,  516,  527,560,643 

Receipts  and  expenditures: 

1960  and  1961 460,  466 

1961 424 

Statement,  1961  and  cumulative 642 

Claims: 

Against  foreign  governments  and  nationals 173 

Expenditures 424,  446 

Nationals.     See  Nationals,  U.S. 

Texas  City  payment 438 

Classification  and  valuation  of  merchandise 146 

Clearing  account 408,  489,  504 

Club  dues  and  initiation  fees,  taxes 485 

Coast  and  Geodetic  Survey  expenditures 432 

Coconut,  etc.,  oils  processed,  taxes 485 

Coin-operated  amusement  and  gaming  devices,  taxes 485 

Coins.     See  Money. 

College  housing  loans 428,  454,  458,  736,  738,  748,  749 

Colombo  Plan  Organization 134 

Colorado  River  Basin  fund.  Upper 440,  459,  749 

Colorado  River  Dam  fund 450,  673,  678,  749 

Combined  Statement  of  Receipts,  Expenditures  and  Balances  of  the  U.S. 

Government 166,  167 

Commerce  and  transportation,  expenditures: 

1953-61 479 

1957-61 72 

Commerce,  Department  of: 

Earnings  paid  to  Treasury 749 

Expenditures: 

1960  and  1961  and  monthly  1961 432 

1961  and  estimates  1962  and  1963 ...73,486 


614359—62 49 


764  INDEX 

Commerce,  Department  of — Continued 
Expenditures — Continued 
Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for:  Page 

Individuals,  etc 680 

States  and  local  units 675 

1961  payments  by  States  and  programs  for: 

Individuals,  etc.  for  State  marine  schools,  subsistence 

of  cadets 693 

States  and  local  units 684 

Export  coordinator,  appointment  recommendation 35 

Interfund  transactions  1960  and  1961 456 

Loans  outstanding 746,  747 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 .-.. 459 

Trust  account  receipts  and  expenditures 462,  466 

Commercial  banks: 

Agents  for  issuing  and  redeeming  Series  A-E  savings  bonds 184 

Depositaries  for  receipt  of  public  moneys 170,  188,630 

Export  financing,  agents  for  the  Export-Import  Bank 127,  348 

Interest  on  savings  deposits,  increase 18 

Security  holdings  (governmental) : 
Federal  securities: 

1941-61,  selected  dates 98 

1952-61,  June  30 625 

1960  and  1961,  June  30,  by  type  of  security 628 

Allotments 604 

Changes  1961 98,  101 

Exchanges 87 

Nonguaranteed  securities  of  Federal  instrumentalities  June  30, 

1952-61 625 

State,    local,    and    territorial    government    securities     June    30, 

1952-61 625 

Tax  and  loan  accounts.  Treasury 630 

Commodity  Credit  Corporation: 

Annual  appropriation  for  capital  impairment  authorized 168 

Appraisal  of  assets  and  liabilities 168,  750 

Borrowing  power 738 

Capital  impairment,  restoration  of  amounts 168,  750 

Capital  stock  owned  by  United  States,  June  30,  1960  and  1961 736 

Federal  aid  to  States: 

1950  and  1961  by  appropriation  title  for  States  and  local  units.  _       675 

1961  by  States  and  programs  for  States  and  local  units 684 

Foreign  currencies  derived  from  sale  of  agricultural  commodities 724 

Interest  paid  to  Treasury 749 

Interfund  transactions  1940-61 452 

Loans  outstanding 746 

Obligations: 

Held  by  Treasury 736,  738,  750 

Held  outside  Treasury 513,  538 

■   Receipts  and  expenditures 430,  458 

Statutory  debt  retirements  from  capital  repayments 606 

Surplus  returned  to  Treasury 750 

Commodity  Exchange  Authority  expenditures 430 

Common  Market  (European  Economic  Community) 36,39,  131-133 

Comptroller  of  the  Currency,  Bureau  of 141-143,  192,  639,  752 

Contributions  and  donations  to  U.S.  Government 175,  485 

Cooperatives,  tax  proposal 25,  103,  310,  338 

Corporate  pension  trust  funds.  Federal  security  holdings 100,  604,  629 

Corporation  income  taxes  {see  also  Taxation): 

1929-61 490 

1953-61 _ 478 

1960  and  1961 65,  418 

1961  by  States 496 

Calendar  1961 21 

1961  and  estimates  1962  and  1963 69,  484 

Rate  extension _  67,  103,  104,  312,  339 

Refunds 486 


INDEX  765 

Corporations  (nongovernment)  governmental  security  holdings: 

P^ederal  securities  June  30:  "  Page 

1941-61 98 

1952-61 ::::::::::::::"    625 

1961  changes 98,  100 

Allotments 604 

Nonguaranteed  securities  of  Federal  instrumentalities  June  30,  1952- 

61 625 

State,  local,  and  territorial  government  securities,  June  30,  1952-61  _.       6-5 
Corporations  and  certain  other  business-type  activities  of  U.S.  Government 
{see  also  specific  agencies): 

Advances  by  Treasury  1961 76,  736 

Assets,  liabilities,  and  net  investment  ofU.S 76^  744 

Borrowing  power 76J  738 

Capital  stock  owned  by  United  States '  736 

Dividends,  interest,  etc.,  paid  to  Treasury 77,  749 

Federal  security  holdings '  629 

Financial  operations 75 

Government-sponsored,  deposit  fund  account  expenditures  (net) 470, 

482,  502 

Interest  rates  on  advances,  determination 77 

Investments  in  public  debt  securities 188,  472,  482,  488 

Loans  outstanding 77,  746 

Obligations: 

Held  by  Treasury: 

1952-61,  June  30,  by  agencies 739 

1960  and  1961,  June  30 _  736 

1961,  June  30 738,  740 

Cancellations 750 

Description 740 

In  custody  of  the  Treasurer  of  United  States 192 

Transactions 77,  736 

Held  outside  Treasury: 
Guaranteed: 

1934-61,  June  30 409,  509 

1952-61,  June  30  by  agencies 513 

1960  and  1961,  June  30 81,  628 

1961,  June  30 78,  517,  535,  53? 

Calls  for  redemption 270,  271 

Description 537 

Interest: 

Computed  rate 517 

Paid  1940-61  by  tax  status 621 

Issued,  redeemed,  and  outstanding  1960  and  1961 78 

Limitation,  statutory,  application 541 

Market  transactions  (net)   1960  and  1961  and  monthly 

1961  by  agencies 1       474 

Matured,  outstanding  June  30,  1961 538 

Not  guaranteed: 

Bank  and  nonbank  investors  June  30,  1952-61 625 

Issued,  redeemed,  and  outstanding  1960  and  1961 78 

Market  transactions  Cnet)   1960  and  1961  and  monthly 

1961  by  agencies 474 

Outstanding  1953-61  and  monthly  1961  by  agencies 514 

Ownership  by  investor  classes: 

1952-61 626 

1960  and  1961 628 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Sales  and  redemptions  of  obligations  in  the  market 188,  474,  483 

Statements,  financial  submitted  to  Treasury 76,  744 

Summary  for   1961 1 75,79 

Treasury  loans  to 76,  77,  171,  736 

U.S.  investment  in 76,  745 

Corps  of  Engineers,  expenditures 438 

Counterfeiting 227 


766  INDEX 

Credit  agencies.     See  Corporations  and  certain  other  business-type  activi- 
ties of  U.S.  Government. 
Credit  unions:  Page 

Agents  for  issuing  and  redeeming  Series  A-E  savings  bonds 184 

Bureau  of  Federal: 

Interest  paid  to  Treasury 749 

Interfund  transactions  1954-61 454 

Receipts  and  expenditures 440,  459 

Cumulative  sinking  fund.     See  Sinking  fund,  cumulative. 
Currency.     See  Dollars;   Foreit^n  currencies;  International  financial  and 
monetary   developments;   International    Monetary   Fund;    Minor   coin; 
Money;  Old  Series  Currency  Adjustment  Act;  Paper  currency;  Silver. 
Customs: 

Bureau  of 144-158,  446,  699-710,  752 

Collections: 

1789-1961 410 

1953-61 478 

1960  and  1961 65,  418,  497 

1961 67,  144,  699 

1961  and  estimates  1962  and  1963 69,  70,  485 

By  countries,  value  of  imports,  and  duties,  1959  and  1960 706 

By  districts 700 

Bv  tariff  schedules  and  values 702-705 

Cost 154,  700 

Duty  exemption  reduction 158,  353,  365 

Ratio  of  duties  to  value  of  imports  by  calendar  years,  1949-59.  702-704 

Drawbick  transactions 145,  497,  699,  700,  701 

Refunds  and  drawbacks 417,  420,  486,  497,  699,  700 

Seizures,  1960  and  1961 153,  709 

Czechoslovakia,  claims  fund 174 

D 

Daily  Statement  of  the  U.S.  Treasury: 

Account  of  the  Treasurer  of  the  United  States,  published  in 79,  185 

Bases  of  data 403 

Dealers  and  brokers,  allotments  on  subscriptions  for  securities 604 

Debt  management 13-20,  80-97 

Defense,  Department  of  (see  also  National  defense): 
Expenditures: 

1953-61 478 

1960  and  1961  and  monthly  1961 434-439 

1961 31 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 680 

States  and  local  units 675 

1961  payments  by  States  and  programs  for: 

Individuals,  etc.,  for  National  Guard 693 

States  and  local  units  for  lease  of  flood  control  lands 685 

Interfund  transactions  1953-61 454 

Intragovernmental  fund  receipts  and  expenditures  1960  and  1961 436 

MiHtary  assistance 436,  747 

Military  functions: 

1953-61 478 

1960  and  1961 437 

1961  and  estimates  1962  and  1963 486 

Profits  on  defense  housing  paid  to  Treasury 749 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 436,459 

Trust  account  receipts  and  expenditures  1960  and  1961 462,  468 

Trust  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 477 


INDEX  767 

Page 

Defense  Lending,  Office  of 158-159,  752 

Defense  materials  activities,  receipts  and  expenditures 458 

Defense  Materials  Procurement  Agency 739 

Defense  Minerals  Exploration  Administration 737-739,  743,  750 

Defense  Production  Act  of  1950,  operations: 

Borrowing  power 738 

Expansion  of  defense  production: 

Expenditures  1960  and  1961  and  monthly  1961 422 

Loans  outstanding 746,  747 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960 

and  1961 458 

Guarantees: 

Earnings  paid  to  Treasury 749 

Expenditures: 

1960 423 

1960  and  1961  and  monthly  1961 438 

Loans  outstanding 746 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960 

and  1961 459 

Interest  paid  to  Treasury 750 

Lending  activities 158 

Obligations  held  by  Treasury  June  30,  1961 738,  739,  743 

Securities  owned  by  United  States 737 

Deficit.     See  Surplus  or  deficit,  U.S.  Government. 
Deposit  fund  accounts: 

Expenditures,  net 482,  488 

Explanation 74,  407 

Receipts  or  expenditures  (net)  1960  and  1961 470 

Depositaries,  Government  (see  also  Tax  and  loan  accounts) : 

Balance  June  30,  1960  and  1961 630 

Balance  June  30,  1961 79 

Number  and  amount  of  deposits  by  class  of  depositaries 188 

Receipt  system  for  taxes,  accounting  procedure 176,  495 

Securities  held  by  Treasurer  of  United  States  against  deposits  in 192 

Depositary  receipts  for  Federal  taxes,  validated  1944-61 177 

Depreciable  business  property,  capital  gains  reform 25,  103,  310,  337 

Depreciation: 

Allowances,  tax  credit  proposal 24,  102,  109,  305,  314 

Questionnaire  survey,  preliminary  report 110 

Schedules  for  textile  machinery,  priority  study 24,  110 

Development  Assistance  Committee  (DAC)  (see  also  Development  Assist- 
ance Group) 40 

Development  Assistance  Group  (DAG) 131,  358,  373 

Development  Loan  Committee  (see  also  Development  Loan  Fund) 373 

Development  Loan  Fund  (see  also  Agency  for  International  Development) : 

Abolished  as  corporate  entity 124 

Expenditures  1960  and  196i 422 

Foreign  currencies  acquired  without  purchase  with  dollars 724 

Foreign  indebtedness  on  U.S.  credits 730 

Loans: 

Commitments 127 

Outstanding 747 

Repayments  in  dollars,  proposal 372 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Diesel  fuel  tax 66,  109,  485 

Disaster  loans,  revolving  fund: 

Loans  outstanding 746 

Receipts  and  expenditure  1960  and  1961 432,  458 

Disaster  relief  expenditures 422,  685 

Disbursement,  Division  of 169 

Disbursing  officers'  checking  accounts,  classes  of  and  checks  paid 190 

Distilled  spirits  tax 104,  484,  491 


768  INDEX 

District  of  Columbia:  Page 

Advance  for  general  expenses 449 

Armory  Board  stadium  bonds: 

Engraved,  printed,  and  delivered 711 

Held  outside  Treasury  (net  sales) 474,  488,  517 

Outstanding  June  30: 

1960  and  1961 513 

1961 517,  537 

Payment  by  Treasurer  of  United  States  as  agent 192 

Deposit  fund  account  receipts  or  expenditures  (net),  1960  and  1961 470 

Federal  payments  and  loans  to: 

1960  and  1961 448,  464 

1961 678 

1961  and  estimates  1962  and  1963 486 

Intertrust  fund  transactions  1948-61 476 

Investments  of  funds 488,  639,  640,  646 

Loans  to 397,  448,  464 

Receipts  and  expenditures  1961  and  estimates  1962  and  1963 487 

Securities  held  in  custody  of  Treasurer  of  United  States 192 

Stadium  fund 474,  488,  738 

Teachers'  retirement  and  annuity  fund 639,  645 

Trust  account  receipts  and  expenditures  1960  and  1961  and  monthlv 

1961 464,  470 

Divested  property  of  enemy  nationals 174 

Dividends,  interest,  etc.,  receipts: 

1932-61  interfund  transactions 450 

1960  and  1961  and  monthly  1961 418 

1961  and  estimates  1962  and  1963 485 

From  Government  corporations,  etc.: 

1960  and  1961 749 

1961 77 

Tax  proposals.     See  Individual  income  taxes ;  Taxation. 

Documents,  other  instruments,  and  playing  cards  tax 65,  484,  491 

Dollar,  importance  in  international  monetary  sj'stem 29,  114.  364,  383 

Dollars,  silver,  in  circulation,  Federal  Reserve  Banks,  and  Treasury,  and 

stock 207,  297,  630,  632,  635-637 

Donations  and  contributions  to  U.S.  Government 175,  485 

Drawback  transactions 145,  497,  699,  700,  701 

Dues,  club,  and  initiation  fees,  taxes 485,  494 

E 

Earnings  from  interest,  dividends,  etc.     See  Dividends,  interest,  etc. 
Economic  Cooperation  and  Development,  Organi:^ation  for  (OECD).     See 
Organi'^ation  for  Economic  Cooperation  and  Development. 

Economic  growth  of  the  Nation 3 

Economic  objectives,  policies,  and  problems 3,  7,  9,  10,  351 

Education  expenditures  1953-61 480 

Education,  Office  of: 
Expenditures: 

1960  and  1961  and  monthly  1961 438 

Federal  aid  to  States  for  payments  to: 

Individuals,  etc.,  1961 681,  695 

States  and  local  units: 

1930,  1940,  1950,  and  1961  by  appropriation  titles 676 

1961  by  States  and  programs 685 

Loans  outstanding 748 

Electric,  gas,  and  oil  appliances,  taxes 484,  492 

Electric  light  bulbs  tax 484 

Electricil  energy  tax 492 

Electronic  data  processing.     See  A.utomatic  data  processing. 

Employees'  Compensation,  Bureau  of,  expenditures 444 

Emplovees  health  benefits  fund,  Civil  Service  Commission 424, 

466,  472,  477,  638,  647 


INDEX  769 

Page 

Employees'  life  insurance  fund,  Civil  Service  Commission 466, 

472,  477,  482,  638,  648 

Employment  security  itdministration  account 170,  443,  459,  464,  470,  665,  669 

Emj^loyment  Security,  Bureau  of,  expenditures 442,  468 

Employment  taxes  (see  also  Internal  revenue;  Receipts;  Taxation): 

1936-61 490 

1953-61 478 

1960  and  1961 65,  66 

1961  and  estimates  1962  and  1963 69 

By  acts: 

1960  and  1961 _      _   66,418 

1961  and  estimates  1962  and  1963 485 

Rate  increases 67,  106,  107 

Refunds 66,  486 

Engraving  and  Printing,  Bureau  of 141,  159-163,446,710,711,752 

Estate  and  gift  tax  collections: 

1953-61 478 

1960  and  1961 65,  67,  418 

1961  and  estimates  1962  and  1963 69,  70,  485 

Refunds 486 

Estate  tax 330,  490 

Estimates  of  receipts  and  expenditures.     See  Budget  estimates;  Expendi- 
tures; Receipts. 

European  Central  Bankers,  meetings  at  Basle 37 

European  Economic  Community  (Common  Market) __  36,  131-133 

European   Economic   Cooperation,   Orf:anization  for   (OEEC).     See  Eco- 
nomic Cooperation  and  Development,  Organization  for. 

European  Free  Trade  Association  (European  Free  Trade  Area) 132 

European  Monetary  Agreement 132 

Exchan;-e  Stabilization  Fund: 

Arreements  ■with  foreirn  countries 40,  121,  122,  369,  388 

Assets  and  liabilities,  June  30,  1960  and  1961 721 

Current  U.S.  stabilization  agreements 121,  723 

Earnings  and  expenses 722 

Foreirn  exchange  transactions 723 

Investments 639,  722 

Excise  taxes  {see  also  specific  taxes;  Taxation): 

1929-61 491-495 

1953-61 478 

1960  and  1961 65,418 

1961  by  States 496 

1961  and  estimates  1962  and  1963 69,70,484 

Highway  trust  fund: 

Rates: 

Extensions 109,  343 

Increases 109,  342,  343 

Receipts  to 343,  487,  655 

Transfers  to 66,  70,  108,  485,  487 

Rate  extension 67,  103,  104,  109,  312,  339,  342,  343 

Refunds 65,  486 

Regulations  issued  or  amended 195,  199 

Revenue  sources 65 

Executive  Office  of  the  President: 

Expenditures _     422,  486,  685 

Public  enterprise  revolving  funds 422,  458 

Expenditures: 

1789-1961 411 

Budget: 

1932-61  and  monthlv  1961 408 

1952-61 : 502 

1953-61  by  major  functions 478 

1953-61,  chart 63 

1957-61 71 

1960  and  1961 64,  420-449 

1961 8,70,73,486 


770  INDEX 

Expenditures — Continued 

Budget — Continued  Page 

1P61  and  estimates  1962  and  1963 73,  486 

1962  and  1963  estimates 9,11 

Contingencies  and  pay  adjustments,  allowance  for 73,  486 

Defense  outlays 5,  71,  478 

Domestic  programs 71 

Federal  aid  to  States 675-699 

Interfund  transactions  deducted 71,  73,  415,  450-457,  481,  486 

Payments  to  the  public  1952-61 500,  502 

Public  enterprise  revolving  funds.     See  Public  enterprise  revolving 
funds. 

Summary  for  1961 70-72 

Expense  account  abuses,  recommendations  to  curb 24,  103,  114,  309,  335 

Export  control  by  Customs,  (Communist  controlled  areas) 147 

Export  coordinator,  appointment  recommendation 35 

Export-Import  Bank: 

Borrowing  power 738 

Capital  stock  owned  by  United  States 736 

Cooley  loans 725 

Credit  commitments,  guarantees,  and  lending  authority 34, 

126,  127,  348,  365 

Dividends  and  interest  paid  to  Treasury 127,  749 

Expenditures: 

1960  and  1961  and  monthly  1961 424 

1961  and  estimates  1962  and  1963 73,  486 

Financial  agreements  between  U.S.  and  Latin  American  countries 122, 

369,  386 

Foreign  currency  loans 124,  127,  725 

Foreign  indebtedness  on  U.S.  credits 127,  730 

Interfund  transactions  1947-61 452 

Loans  outstanding 747 

Obligations  held  by  Treasury 738 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Export  credit  insurance  expansion 34,  127,348 

Exports  and  U.S.  balance  of  payments 28,  32,  34,  117,  348,  365,  370,  382 

Extension  Service,  agricultural,  expenditures 430 

F 

Farm  Credit  Administration: 

Expenditures 424 

Franchise  tax  and  dividends  paid  to  Treasury 749 

Interfund  transactions 450 

Loans  outstanding 748 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 424,458 

Farm  labor  supply  fund  receipts  and  expenditures 444,  459 

Farm  tenant  mortgage  insurance  fund 432, 

456,  458,  510,  639,  736-739,  742,  746,  749 

Farmer  Cooperative  Service  expenditures 430 

Farmers'  Home  Administration  {see  also  Farm  tenant  mortgage  insurance 
fund): 

Borrowing  power  (Secretary  of  Agriculture) 738 

Expenditures  1960  and  1961  and  monthly  1961 432 

Interest  paid  to  Treasury 749 

Interfund  transactions  1956-61 456 

Loans  outstanding 746 

Obligations  held  by  Treasury 736-739,  741 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

State  rural  rehabiUtation  funds,  investments 640 

Trust  enterprise  revolving  fund,  receipts  and  expenditures  1960  and 

1961 477 


INDEX  771 

Federal  agencies  and  trust  funds,  governmental  security  holdings.     See 

Government  investment  accounts.  Page 

Federal-Aid  Highway  Act  of  1961,  revenue  changes 108 

Federal  aid  to  States,  expenditures: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  and  agencies  for: 

Individuals,  etc 679-682 

States  and  local  units II II  675-679 

1961  payments  for  selected  programs  by  States  and  by  agencies  for- 

Individuals,  etc 693-697 

States  and  local  units 683 

Federal  Aviation  Agency  expenditures: 

1960  and  1961 424 

1961  and  estimates  1962  and  1963 IIIIIIIIII'I   "73  486 

Federal  aid  payments  to  States  and  local  units  for  Federal" airport 

program: 

1950  and  1961 679 

1961  by  States IIIII  691 

Federal  Boating  Act  of  1958,  numbering  provisions V[^l^^^^[^i^^V[^[^[^       148 

Federal  Bureau  of  Investigation  expenditures __  442 

Federal  Civil  Defense  Act  of  1950  (Secretary  of  the  Treasury)"  "ope'ratio'nsl 

Interest  paid  to  Treasury __         749 

Lending  activities IIII'I"I   "        158 

Loans  outstanding 747 

Obligations  held  by  Treasury III       737-739  742 

Federal  Coal  Mine  Safety  Board  of  Review  expenditures V. '  424 

Federal  Communications  Commission  expenditures "424,  477 

Federal  Crop  Insurance  Corporation 43O  458  736 

Federal  Deposit  Insurance  Corporation:  "         '        ' 

Borrowing  power 7gg 

Investments: 

1952-61 _  _        _  638 

1960  and  1961 IIIIIIIIIII  472 

Securities  held  in  custody  of  Treasurer  of  the  United'StatesIIIIIIIII       192 
Treasury  notes  issued  to: 

Interest,  computed  rate 5I6 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 _   _   _     546  550 

n  ,\^^\- '561 

Outstandmg: 

1952-61,  June  30 _  _  5IO 

1960  and  1961,  June  30 III   ~~~_  561 

1961,  June  30 II.Iir516,  528 

Description 528 

Federal  disability  insurance  trust  fund: 

Certificates  of  indebtedness,  and  Treasury  notes  and  bonds  issued  to- 

Description 529,650 

Interest  rate: 

Computed 516 

Statutory  changes 75  171 

Issues  and  redemptions _       546550*  561 

Outstanding 5i6,'5i6,  529,' 561,' 650 

Intertrust  fund  transactions  1958-61 _  476 

Investments 472,'482,"488,"638,  650 

Receipts  and  expenditures: 

1957-61 482 

1960  and  1961 "     """462  468 

1961  and  estimates  1962  and  1963 I '  487 

Statement,  1961  and  cumulative 650 

Transfers  to: 

1957-1961 416,478 

1960  and  1961 66,  420,  462 

1961  and  estimates  1962  and  1963 485 


772  INDEX 

Federal  employees:  Page 

Health  benefits  fund 424.  466,  472,  477,  638,  647 

Life  insurance  fund 466,  472,  477,  482,  638,  648 

Retirement  funds 424  460,  462,  466.  468,  472, 

476,  482,  487.  488,  511,  516,  532,  546,  552,  562,  638,  642,  654 

Surety  bonds,  status  of  coverage 172 

Withholding  of  State  income  taxes  from  compensation 176,  496 

Federal  extended  compensation  account 465,  471,  665,  669 

Federal  Facilities  Corporation 748 

Federal  farm  loan  bonds 711 

Federal  Farm  Mortgage  Corporation: 

Dividends  paid  to  Treasury 749 

Interfund  transactions 450 

Loans   outstanding 748 

Obligations  held  outside  Treasury: 

1952-61,  June  30 513 

1961,  June  30 538 

Market  transactions  (net)  1960  and  1961  and  monthly  1961 474 

Principal  and  interest  paid  by  Treasurer  of  United  States  as 

agent 192 

Receipts  and  expenditures  1960  and  1961 424,  458 

Federal  highway  program.     See  Highway  program;  Highway    trust   fund. 

Federal  Home  Loan  Bank  Board 424,  458,  486 

Federal  home  loan  banks: 

Borrowing  power 738 

Certificates  of  indebtedness  and  Treasury  notes  issued  to: 

Interest,  computed  rate 516 

Issues  and  redemptions  1961 546,  552,  561 

Outstanding: 

1952-61,  June  30 511 

1960  and  1961,  June  30 561 

1961,  June  30 516,  530 

Description 530 

Investments: 

1952-61 640 

1960  and  1961 472 

Notes  engraved,  printed,  and  delivered 711 

Obligations  (not  guaranteed) 192,  474,  514 

Federal  Housing  Administration: 

Debentures  engraved,  printed,  and  delivered 711 

Interfund  transactions  1954 454 

Investments: 

1952-61 638 

1955-61 640 

1960  and  1961 472 

Loans  outstanding 746 

Mortgage  rates,  effect  on  available  funds 356 

Obligations  held  outside  Treasury 192,  474,  488,  513,  517,  537,  737 

Receints  and  expenditures  1960  and  1961 428,  458 

Securities  owned  by  United  States 737 

Treasury  notes  issued  to: 

Interest,  computed  rate 516 

Issues  and  redemptions: 

1960  and  1961  and  monthlv  1961 546,  552 

1961 561 

Outstanding: 

1952-61,  June  30 511 

1960  and  1961,  June  30 561 

1961,  June  30 516,  530 

Description 530 

Federal  Insurance  Contributions  Act  and  Self-Employment  Contributions 
Act.     See  Employment  taxes. 


INDEX  773 

Federal  intermediate  credit  banks :  Page 

Bonds  and  debentures  engraved,  printed,  and  delivered  7n 
Capital  stock  owned  bv  United  States  • 

Advances  1961 _        _                 _      _          _  7-ia 

Amount  June  30,  1960  and"  1961  7or 

Franchise  tax  paid  to  Treasurv                           _              ^  via 

Interfund  transactions  1932,  lV3'8-57             "  it] 

Investment  fund,  receipts  and  expenditures  1960"  and"  1961  424  4'iS 

Investments:  '±^-±,  too 

1952-61 „.„ 

1960  and  1961 ^79 

Obligations  (not  guaranteed) :  "'"        ""        " 

Market  transactions  (net)  1960  and  1961  and  monthly  1961  474 

Outstandmg  1953-61,     ._.___  Via 

Payments  to  Treasury--  ^kf 

Federalland  banks ."___  iq2~479"474  ^^A 

^tptUiSs  y5"f  Got:.  °zr''°"'' "'"  ''''^^  '"'"■'"''^  ^-'--- 

Federal  Mediation  and  Conciliation  Service  expenditures  494 

I'ederal  National  Mortgage  Association: 

Borrowing  power _,„„ 

Capital  stock  owned  by  United  States:       "    ""    " 

Advances  1961 ^o^ 

Amount  June  30,  19"6"o' and  1961  70^ 

Debentures  engraved,  printed,  and  delivered  711 

Dividends  and  interest  paid  to  Treasury  ""    "  740 

Expenditures  1961  and  estimates  1962  and  1963  4qr 

Interfund  transactions  1951-61.  7^^ 

Investments:  '''* 

1952-61 „._ 

1960  and  1961 5^5 

1961  and  estimates  1962  and  19"63  400 

Loans  outstanding ^°° 

Notes  purchased  by  Treasury..  _  sq"9qq  oaa 

Obligations:  '  «9,  233,  244 

Held  by  Treasury 736  73S 

Held  outside  Treasury,  transactions' (net")".". ^^  474"488  514'  737 

Principal  and  interest  paid  by  Treasurer  of  United  States  'as     ' 

agent _        _^ ^  j^„2 

PubHc  enterprise  revolving  fund  receipts  and"  ixpendituVes"  1960  "and 

Receipts  and  expenditures  "l"9"6"o"  an"d"  1961-  428  466 

Truest  ^enterprise  revolving  fund  receipts  and"  expe"n"di"t"ures  "l"9"6"o"  "a'nd     ' 

Federal  old-age  and  survivors  insurance  trust"  f und  • 

Certificates  of  indebtedness  and  Treasury  notes  and  bonds  issued  to- 

Description (.„. 

Interest  rate:  """         '"   "     '  ^"^^ 

Computed r-.^. 

Statutory  changes ----"II""-r"I""'r"75   171 

Issues  and  redemptions -----"-":-":::"53i,"546,"552,' 561 

Outstanding en    cir  coi    cci    cVi 

Intertrust  fund  transactio"nV  1559-61 511,  516,  531,  561,  6o2 

JSS^a^dexpenditur^s: :-::::::::::: -472:482;ii§:638,  652 

1952-61 

1960  and  1961 4fi4"ifi8  ttZ 

1961  and  estimates  1962  and  l"96"3  '  '  407 
Statement,  1961  and  cumulative  ccq 
Transfers  to: 

1937-61 .,„ 

1953-61 :::  416 

1960  and  1961 fifi"i9n  Vfu 

1961  and  estimates  1962  and  1963 lll~llllllll"  '485 


774  INDEX 

Page 

Federal  Power  Commission  expenditures 424,  679,  691 

Federal  Prison  Industries,  Inc 442,  749 

Federal  Prison  Sj^stem  receipts  and  expenditures 442,  469,  477 

Federal  Reserve  Bank  notes: 

In  circulation,  Federal  Reserve  Banks,  and  Treasurv,  and  stock 630, 

632-636 

Redeemed  and  outstanding 535,  637 

Federal  Reserve  Banks: 

Depositaries  for  Government  funds 170,  188,  630 

Federal  security  holdings: 

1941-61,  June  30 98 

1952-61,  June  30 625,  626 

1961  changes 98,  101 

Franchise  tax  paid  to  Treasury  1918-33 606 

Interest  charges  on  Federal  Reserve  notes  deposited  in  Treasury.  _    176,  498 

Money  held  by  and  for 632,  634,  637 

Paper  currency,  destruction  of  unfit 190 

Treasury  deposits 188,  630 

Federal  Reserve  notes: 

Engraved,  printed,  and  delivered 711 

In  circulation,  Federal  Reserve  Banks,  and  Treasurv,  and  stock 630, 

632-636 

Interest  charges  on  notes  deposited  in  Treasury' 176,  498 

Issued,  redeemed,  and  outstanding 637 

Old  Series  Currencv  Adjustment  Act  effect 189,  297,  298 

Outstanding  1946-61 539 

Redemption  fund 630 

Unissued  stocks,  annual  audit 168 

Federal  Savings  and  Loan  Insurance  Corporation: 

Borrowing  power 738 

Investments: 

1952-61 638 

1960  and  1961 472 

Loans  outstanding 747 

Receipts  and  expenditures  1960  and  1961 424,  458 

Treasury  notes  issued  to: 

Interest,  computed  rate 516 

Issues  and  redemptions: 

1960  and  1961  and  monthlv  1961 546,  552 

1961 1 562 

Outstanding: 

1952-61,  June  30 511 

1960  and  1961,  June  30 562 

1961,  June  30 516,  531 

Description 531 

Federal  securities  (public  debt  and  guaranteed  obligations) : 
Distribution  by: 

Call  classes  and  investors,  June  30,  1960  and  1961 628 

Maturity,  marketable  interest-bearing  June  30,  1946-61 515 

Interest  paid  1940-61  by  tax  status 621 

Investments  in,  by  Government  agencies: 

1952-61 505,  638 

1960  and  1961  and  monthly  1961 472 

Outstanding: 

1932-61,  June  30  and  monthly  1961 409 

1934-61,  June  30 509 

1952-61,  June  30,  bv  tax  status  and  investor  classes 626 

1960  and  1961,  June  30 81 

Description 518-536 

Limitation,  statutory: 
Amounts  subject  to: 

1938-61 409 

1961 541 

Legislative  history 542 

Temporary  increase  authorized 96,  297 


INDEX  775 

Federal  securities — Continued 

Outstanding — Continued  Page 

Per  capita  1934-61 509 

Ownership: 

1941-61,  selected  dates,  by  investor  classes 98 

1952-61,  June  30,  by: 

Government  agencies  and  accounts 638 

Investor  classes 625 

Tax  status  and  investor  classes 626 

1960  and  1961,  June  30,  by  investors  covered  in  Treasury  Survey.       628 

1961,  June  30,  by  investor  classes 99 

Estimated  changes  by  type  of  issue 101 

Foreign  and  international  accounts 100,  119,  718 

Summary  for  1961 97-101 

Federal  ship  mortgage  insurance  fund 456,  639,  736-739,  742,  746,  749 

Federal  Trade  Commission  expenditures 424 

Federal  unemployment  account 465,  666,  669 

Federal  Unemployment  Tax  Act.     See  Employment  taxes. 

Fees,  etc.,  receipts  1961  and  estiniates_1962  and  1963 485 

Financial  Analysis,  Office  of 42 

Financing,  Treasury.  See  Debt  management;  Fiscal  operations;  Fiscal 
policy;  Public  debt. 

Fine  Arts,  Commission  of,  expenditures 440 

Fines,  penalties,  and  forfeitures,  receipts  1961  and  estimates  1962  and  1963-       485 

Finland,  payments  on  World  War  I  indebtedness 172,  728 

Fire  and  casualty  insurance  companies,  taxation  proposal 25,  103,  310,  338 

Firearms,  shells,  and  cartridges,  taxes 484 

Fiscal  Assistant  Secretary 163,  397 

Fiscal  operations  (general) : 

1932-61  and  monthly  1961 408 

Public  debt,  effect  on,  1961  and  estimates  1962  and  1963 489 

Review 63-135 

Fiscal  policy 3-12 

Fiscal  Service  administrative  reports 163-192 

Fish  and  Wildlife  Service  expenditures 442,  459 

Fisheries  loan  fund 747 

Fishing  rods,  creels,  etc.,  taxes 484 

Flood  insurance 738 

Flood  prevention  and  watershed  protection  expenditures 430 

Food  and  Drug  Administration  expenditures 438 

Foreign  Agricultural  Service  expenditures 430 

Foreign  and  international  accounts.  Federal  security  holdings 100,  119,  718 

Foreign  assets  control 135,  176,  205 

Foreign  Assistance  Act  advances 487 

Foreign  assistance  by  United  States  {see  also  Agency  for  International 
Development;  Development  Loan  Fund;  Export-Import  Bank; 
Foreign  government  indebtedness  to  United  States;  Inter-American 
Development  Bank;  International  Bank  for  Reconstruction  and 
Development;  International  Cooperation  Administration;  International 
Development  Association;  International  Finance  Corporation;  Inter- 
national financial  and  monetary  developments;  International  Monetary 
Fund;  Mutual  security): 

Economic,  technical,  and  other  aid...    31,  39,  73,  115,  118,  172,  365,  422,  486 

Military  assistance 40,  436,  478,  747 

Revision  in  organization  and  basic  concepts 40,  115,  123 

U.S.  credits  outstanding,  indebtedness  by  area  country,  and  tvpe, 

June  30,  1961  (excluding  World  War  I) I.-.       730 

Foreign  Claims  Settlement  Commission 173,  424 

Foreign  coins  manufactured  by  United  States 206 

Foreign  Commerce,  Bureau  of,  expenditures 432 

Foreign  Credit  Insurance  Association  {see  also  Export-Import  Bank) 34,  348 

Foreign  currencies  acquired  without  purchase  with  dollars: 

Accounting  control 164,  167 

Balances  held  by  United  States,  by  countries  and  currencies 726 

Loans 127,747 

Transactions  and  balances 127,  168,  172,  724,  732 


776  INDEX 

Page 

Foreign  depositaries,  Treasury  deposits 630 

Foreign  exchange  (convertible) : 

Acquisitions 121 

Exchange  stabilization  fund  earnings 722 

Forward  exchange  market  operations  by  the: 

Federal  Reserve  System 37 

Treasury 37,  121,377 

Holdings 121,720 

Reporting  by  the  Treasury 119 

Stabilization  operations 120 

Foreign  financial  policy.  See  International  financial  and  monetary  develop- 
ments. 
Foreign  government  indebtedness  to  United  States: 

Foreign  obligations  held  in  custody  of  the  Treasurer  of  the  United 

States 192 

France,  postponement  of  payment  for  lend-lease  and  surplus  property 

purchases 173 

Germany: 

Postwar  (World  War  II)  economic  assistance,  interest  payments.       173 

Prepayments  on  debt  to  United  States 28,  38,  121,  133,  382 

World  War  I,  under  agreements  of  1930,  1932,  and  1953  and  pay- 
ments on 174,  729 

Lend-lease  and  surplus  property  agreements  (World  War  II),  amounts 

billed,  collected,  and  balances  due,  by  countries 732 

Outstanding  on  U.  S.  Government  credits  (excluding  World  War  I)__       730 

Payments  f961 28,  117,  121,  133,  172 

Statutory  debt  retirements  from  repayments  1919-39 606 

United  Kingdom: 

Anglo-American  Financial  Agreement  of  1945,  payment  of  princi- 
pal and  interest 173 

Lend-lease  and  surplus  property  obligations 730,  733,  734 

Postwar  (World  War  II)  credit  to 173 

World  War  I  by  countries  and  payments 728 

ForeiQ;n  investment  guaranty  fund 422,  458,  738 

Foreign  investments  in  the  United  States 118 

Foreign  loans  receivable  held  by  Government  agencies 747 

Foreign  service  retirement  and  disability  fund 462, 

468,  472,  511,  516,  532,  546,  552,  562,  638,  654 
Foreign  trade  of  United  States.     See  International  financial  and  monetary 
developments. 

Forei*?!!  trade  zones 153 

Forest  Service  expenditures 432 

Forgery 225,228 

Fort  Peck  project  receipts  and  expenditures 440,  459 

Forward  exchan  !;e  operations.     See  Foreign  exchange. 

Fountain  pens  and  pencils,  taxes 484 

Fractional  currency 534,  573 

France: 

Minister  of  Finance  and  Economic  Affairs,  meeting 134 

Postponement  of  payment  for  lend-lease  and  surplus  property  pur- 
chases   173 

Repayments  to  the  International  Monetary  Fund 123 

Freedmen's  Hospital  expenditures 438 

Fund  for  Social  Pro^-ress 41,  125,  360-363 

Fund  for  Special  Operations 125,  126 

Funds  appropriated  to  the  President: 
Expenditures: 

1900  and  1961 458 

1960  and  1961  and  monthly  1961 422,  460,  466 

1961 685 

1961  and  estimates  1962  and  1963 73,  486 

Interfund  transactions  1952-61 454 

Furs  tax 484,  493 


INDEX  777 

G 

Page 

Gallaudet  College  expenditures 440 

Gasoline  tax 66,  109,  484,  492 

General  Accounting  Office  expenditures 424 

General  Agreement  on  Tariffs  and  Trade  (GATT) 132 

General  fund  receipt  and  expenditure  accounts,  explanation 406 

General  government  expenditures 481 

General  Services  Administration: 

Borrowing  power 738 

Earnings  paid  to  Treasury 749 

Expenditures: 

1960  and  1961  and  monthly  1961 426 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States,  1950  and  1961  by  appropriation  titles  for: 

Individuals,  etc 681 

States  and  local  units 678 

Loans  outstanding 747 

Obligations  held  by  Treasury 737-739,  743 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

Trust  account  receipts  and  expenditures: 

1960  and  1961 466 

1960  and  1961  and  monthly  1961 462 

Trust  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 477 

Geological  Survey  expenditures 442 

Germany: 

Awards  of  Mixed  Claims  Commission  to  United  States  and  its  na- 
tionals: 

Indebtedness  and  payments 174,  712,  729 

Payments  by  classes  of  awards 712 

Bonn  Conference,  Nov.  21-23,  1960 133 

Indebtedness  to  United  States: 

Postwar  (World  War  II)  by  programs 730,  732,  734 

Postwar  (World  War  II)  economic  assistance,  repayments 173,  732 

World  War  I 174,  729 

Prepayment  on  debt  to  United  States 28,  121,  133,  382 

Gift  tax 490 

Gifts,  donations,  and  contributions  to  U.S.  Government,  receipts 175,  485 

Gold  (see  also  Balance  of  payments,  U.S.) : 

Acquisitions 207 

Assets  and  liabilities  in  account  of  Treasurer  of  United  States 630 

Balance  in  general  account  of  Treasurer  of  United  States 187,  630 

Certificate  fund,  Board  of  Governors,  Federal  Reserve  System 630 

Certificates 189,  297,  630,  632,  633,  636,  637 

Holdings  abroad  by  U.S.  citizens,  prohibition  by  Executive  order 120 

In  circulation  June  30,  1913-30 636 

In  Exchange  Stabilization  Fund 722 

In  Treasury 187,632,637 

Increment  from  reduction  in  weight  of  gold  dollar,  receipts 464 

Liabilities  against  gold  June  30: 

1960  and  1961 630 

1961 187,632 

Melting  losses,  payment  of,  1960  and  1961 471 

Percentage  of  total  money . 635 

Production  and  use 208 

Received  and  withdrawn  (excluding  intermint  transfers) 207 

Reserve  against  United  States  notes  and  Treasury  notes  of  1890.--   630,  632 

Reserves  and  dollar  holdings  of  foreign  countries 119,  718 

Stock 119,  207,  632,  635,  637,  720 

Transactions  with  foreign  countries  and  international  institutions 28, 

118,716 
Government  corporations.     See  Corporations  and  certain  other  business- 
type  activities  of  U.S.  Government. 


778  INDEX 

Government  investment   accounts,   governmental  security   holdings    (see 

also  Trust  account  and  other  transactions) :  Page 

Accounts  handled  by  the  Treasury 74,  638 

Federal  securities: 

1941-61,  June  30  and  selected  dates 98 

1952-61,  June  30 625,  626,  638 

1961  changes 98,  100,  101 

1961,  June  30 97 

Interest  rates  on  special  issues,  action  towards  uniformity 74 

Nonguaranteed  securities  of  Federal  instrumentalities  1952-61 625,  626 

Responsibility  for 74,  171 

State,  local,  and  territorial  government  securities  1952-61 625,  626 

Government  life  insurance  fund 460, 

466,  472,  482,  511,  516,  532,  547,  552,  562,  638,  670 

Government  losses  in  shipment  revolving  fund 176,  446,  459,  751 

Government  Organization,  President's  Advisory  Committee  on,  expendi- 
tures        422 

Government  Printing  Office: 

Earnings  paid  to  Treasury 749 

Expenditures  1960  and  1961 420 

Government-sponsored  enterprises.     See  Corporations  and  certain  other 
business-type  activities  of  U.S.  Government;  Public  debt,  Investments 
of  Government  agencies  in  securities. 
Grants  (Federal  aid)  to  State,  local,  and  territorial  governments,  1930,  1940, 

1950,  and  1961 105,675-699 

Guaranteed  obligations.     See  Corporations  and  certain  other  business-type 
activities  of  U.S.  Government,  Obligations. 

H 

Health,  Education,  and  Welfare,  Department  of: 
Expenditures: 

1960  and  1961  and  monthly  1961 438 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 680 

States  and  local  units 676 

1961  payments  by  States  and  programs  for: 

Individuals,  etc 694 

States  and  local  units 685 

Interest  paid  to  Treasury 749 

Interfund  transactions  1954-61 454 

Loans  outstanding 747 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 459 

Trust  account  receipts  and  expenditures  1960  and  1961 462,  468 

Health  insurance  for  aged,  proposal 107,  487 

Health,  labor,  and  welfare,  expenditures: 

1953-61 480 

'^     1957-61 72 

Highway  program.  Federal  aid  grants 675,684 

Highway  Revenue  Act  of  1956,  rates  and  proposed  changes 342 

Highway  system.  Federal  financing  to  complete 102,  108,  341 

Highway  trust  fund: 

Certificates  of  indebtedness  issued  to: 

Description 532 

Interest  rate 516 

Issues  and  redemptions 546,  552,  562 

Outstanding 511,  516,  562,  655 

Financing  program  to  1972 102,  108,  341-343 

General  fund,  rescinding  of  diversion  of  1962-64  revenues 109,  341 

Investments.. 472,  482,  638,  655 


INDEX  779 

Highway  trust  fund — Continued 

Receipts  and  expenditures:  Page 

1957-61 482 

1960  and  1961 462,  466 

1961  and  estimates  1962  and  1963 487,  488 

Additional  receipts  needed  to  complete  highway  system  by  1972_       341 

Reimbursements  to  general  fund  (refunds  of  excise  tax  receipts) 488,  655 

Statement,  1961  and  cumulative 655 

Transfers  to: 

1957-61 416,  478 

1960  and  1961 65,  66,  420 

1961  and  estimates  1962  and  1963 70,  485 

Historical  and  memorial  commissions,  expenditures 424 

Home  Owners'  Loan  Corporation,  obligations  held  outside  Treasury 192, 

450,  474,  513,  538 

Home  owners'  loans 746 

Housing  and  community  development  expenditures  1953-61 480 

Housing  and  Home  Finance  Agency  (see  also  Federal  Housing  Administra- 
tion; Federal  National  Mortgage  Association;  Public  Housing  Adminis- 
tration) : 

Borrowing  power 738 

Expenditures: 

1960  and  1961  and  monthly  1961 428 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  payments  to  States  and  local  units: 

1940,  1950,  and  1961  by  appropriation  titles 679 

1961  by  States  and  programs 691 

Interest  paid  to  Treasury 749 

Interfund  transactions  1935-61 450 

Investments 488,  640 

Loans  outstanding 746,  747 

Obligations  held  by  Treasury 736-741 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 428,  458 

Housing  insurance  fund 271,  511,  513,  530,  537,  561,  638 

Housing  investment  insurance  fund 511,  530,  561,  638 

Howard  University  expenditures 440 

Hungarian  claims  fund 715 


Immigration  and  Naturalization  Service  expenditures 442 

Income  taxes  (see  also  Corporation  income  taxes;  Individual  income  taxes; 
Taxation) : 

1863-1961 412 

1929-61 490 

1960  and  1961 65 

Calendar  1961 7,  21 

1961  and  estimates  1962  and  1963 69 

India,  aid  to 41,  128,  373,  738 

Indian  Affairs,  Bureau  of: 

Expenditures  1960  and  1961  and  monthly  1961 440 

Federal  aid  payments  to  States  and  local  units  for  loans 690 

Public  enterprise  revolving  funds 440,  459,  746,  748 

Securities  held  in  custody  of  Treasurer  of  U.S.  for  Commissioner 192 

Indian  Claims  Commission  expenditures  1960  and  1961  and  monthly  1961.  424 
Indian  individuals  funds,  deposit  fund  accounts,  investment  in  Federal 

securities,  1952-61 639 

Indian  tribal  funds,  receipts  and  expenditures: 

1960  and  1961  and  monthly  1961 462,  468,  470 

1961  and  estimates  1962  and  1963 487 


614359—62 50 


780  INDEX 

Individual  income  taxes  (see  also  Taxation) :  Page 

1929-61 490 

1953-61 478 

1960  and  1961 65,418 

Calendar  1961 21 

1961  and  estimates  1962  and  1963 69,  484 

Dividends  and  interest,  proposed  changes  for  tax  purposes 25, 

102,  103,  308,  330 

Foreign  income  tax  exemptions,  claims  by  country  of  residence 329 

Refunds 7,  486 

Taxpayer  account  numbers 25,  103,  105,  311,  340 

Withheld 69,  418,484,  490 

Withholding  agreements  with  States  and  Territories 176 

Individual  income  taxes  and  employment  taxes  by  States 496 

Individuals,  governmental  security  holdings: 
Federal  securities: 

1941-61,  selected  dates 98 

1952-61,  selected  dates 625 

1961  changes 98 

Allotments 604 

Nonguaranteed    securities    of    Federal    instrumentalities    June     30, 

1952-61 625 

State,  local,  and  territorial  government  securities,  June  30,  1952-61.  _       625 

Indus  Basin  Development  Fund 128 

Industrial  loans  by  Government  agencies,  outstanding  June  30,  1961 746 

Informational  media  guaranty  fund 426,  456,  724,  737,  738,  742,  749 

Inland  Waterways  Corporation 432,  459,  736 

Insurance  companies,  governmental  security  holdings: 
Federal  securities: 

1941-61,  selected  dates 98 

1952-61,  selected  dates 625 

1960  and  1961,  June  30,  by  type  of  security 628 

1961  changes 98 

Allotments 604 

Exchanges 87 

Nonguaranteed  securities  of  Federal  instrumentalities  June  30,  1952- 

61 625 

State,  local,  and  territorial  government  securities  June  30,  1952-61.        625 

Insurance  fund  debentures,  calls  for  partial  redemption 270 

Inter-American  Development  Bank: 

Establishment  and  purpose 115,  125,  357,  369,363,385,387 

Fund  for  Social  Progress 41,  125,  360,  363 

Fund  for  Special  Operations 125,  126 

Latin  America,  assistance 41,  125,  357,  363-363,385 

Lending  operations 41,  115,  126,  360,363 

Membership  of  U.S.  and  resources 125 

Remarks  by  the  Secretary  of  the   Treasury,  second  meeting  of  the 

Board  of  Governors 357,  360 

Subscription  by  U.S 126,447,  744 

Inter-American  Economic  and  Social  Council 115,  124,  125,  134 

Inter- American  social  progress  program 124 

Interest  {see  also  Public  debt) : 
Expenditures: 

1953-61 480 

1957-61 71 

1961  and  estimates  1962  and  1963 73,  486 

Interfund  transactions  1933-61 450 

Rates,  special  issues,  action  toward  uniformity  in  bases 74 

Receipts: 

1960  and  1961 749 

1961  and  estimates  1962  and  1963 485 


INDEX  781 

Interfund  transactions:  Page 

1932-61 408,  414,  415,  450-457 

1953-61 478,481 

1957-61 71 

1960  and  1961 65 

1960  and  1961  and  monthly  1961 420,  448 

1961  and  estimates  for  1962  and  1963 69,  73,'  486 

Reporting  change: 

1960  Budget 404 

1961  Intertrust 476,  487,  488 

Intergovernmental  Maritime  Consultative  Organization 151 

Intergovernmental  Relations,  Advisory  Commission  on 422 

Interior,  Department  of: 

Defense  production  expansion 746 

Expenditures: 

1960  and  1961  and  monthly  1961 _.  440 

1961  and  estimates  1962  and  1963 73,486 

Federal  aid  payments  to  States  and  local  units: 

1930,  1940,  1950,  and  1961  by  appropriation  titles 677 

1961  payments  by  States  and  programs 690 

Interest  and  earnings  paid  to  Treasury 749 

Interfund  transactions  1937-61 450 

Loans  outstanding 746,  747 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 440,459 

Trust  account  receipts  and  expenditures  1960  and  1961 462,  468 

Internal  auditing  in  Treasury  Department 140,  160,  168,  203 

Internal  revenue: 

1792-1961 410 

1929-61  by  tax  sources 490 

1960  and  1961 65,418 

1961  by  States 496 

1961 193 

1961  and  estimates  1962  and  1963 484 

Refunds 65,  193,  417,  420,  486,  496 

Internal  Revenue  Service: 

Administrative  report 193-204 

Assistance  to  taxpayers 194 

Audit  coverage,  increase  necessary 26,  103,  311,  340 

Automatic  data  processing  (ADP) 43,  139 

Bulletin  "F"  revision 110 

Collections  for,  by  Bureau  of  Customs 699,  700 

Cost  of  administration 202 

Law  enforcement  activities 26,  103,  177,  196,  311,  335 

Long-range  planning 202 

Organizational  changes 395 

Personnel 201,  752 

Receipts  and  expenditures  1960  and  1961 446 

Regulations  of  1961,  summary 195 

Returns  received  and  examined 21,  195 

Self-assessment,  voluntary 311 

International  affairs  and  finance  expenditures: 

1953-61 479 

1957-61 71 

1931 71 

International  Bank  for  Reconstruction  and  Development: 

Activities 128 

Annual  meeting 116 

International  Development  Association  affiliate  of 115,  129,  387 

International  Finance  Corporation  affiliate  of 367 

Lending  operations 128,  386 

Stimulation  of  cooperation  by  industrialized  countries  to  assist  less- 
developed  countries 40,  41,  128,  373 

Stock  1952-61 744 


782  INDEX 

Page 

International  claims 173,  712,  714,  715 

International  Cooperation  Administration  {see  also  Agency  for  Interna- 
tional Development) : 

Abolished  and  functions  transferred 124 

Borrowing  power 738 

Foreign  investment  guaranty  fund 422,  458,  738 

Foreign  loans 747 

Inter-American  social  progress  program 125 

Interest  paid  to  Treasury 749 

Military  assistance  expenditures 438 

Mutual  security  expenditures  1960  and  1961  and  monthly  1961 422 

Obligations  held  by  Treasury 736,  738,  739,  741 

International  Development,  Act  for,  provisions 123,  370 

International  Development,  Agency  for 31,40,124 

International  Development  Association: 

Annual  meeting 116 

Articles  of  agreement,  signing  of 129,  387 

Development  loans,  proposal  of  new  terms  and  conditions 373 

Establishment  and  purpose 115,  129,  387 

Lending  operations 115,  129 

Notes  of  United  States  as  payments  to.     See  Notes,  Special  notes  of 
United  States. 

U.S.  subscription 129,  387,  446,  744 

International  Finance  Corporation: 

Amendment  to  the  Articles  of  Agreement 130,  384 

Annual  meeting 116 

Investment  operations 130,  367 

Origin  and  function 367 

Statement  by  Assistant  Secretary  of  the  Treasury  Leddy  on  the  an- 
nual report 384 

Statement  by  Secretary  of  the  Treasury  on  the  annual  report 367 

Stock  1957-61 744 

U.S.  subscription 367 

International  Finance,  Office  of 204,  752 

International  financial  and  monetary  developments  (see  also  Foreign  assist- 
ance by  United  States;  Foreign  government  indebtedness  to  United 
States;  specific  agencies): 

Balance  of  payments.     See  Balance  of  payments,  U.S. 

Dollar,  importance  in  international  monetary  system 29,  1 1 4,  364,  383 

Exchange  agreements  with  foreign  countries 40,  121,  128,  369,  388 

Financing  economic  development  in  Latin  America 40, 

115,  124,  125,  358,  360,  369,  385,  387 

Foreign  assets  control 135,  176,  205 

Foreign   countries  and  international  institutions,   gold  reserves  and 

dollar  holdings 119,  716,  718 

Foreign  exchange  stabilization  operations 120 

Foreign  investment  of  U.S.  private  capital: 

Amounts 130,366,386 

Income  tax  rates  imposed  by  various  European  countries 321 

Tax  treatment  of  foreign  income  proposals...  24,  102,  306,  320,  327,  366 
International  financial  system,  steps  taken  to  strengthen..   3,  27,  35,  36,  376 

OECD  coordination  of  financial  policies 349 

Summary  for  1961 27-41,  114-135 

Tariffs  and  trade: 

GATT  progress  under 132 

Lowering  of  tariff  under  proposed  Trade  Expansion  Act 36.39 

International  meetings 133 

International  Monetary  Fund: 

Activities 122 

Admittance  of  ten  new  countries 380 

Annual  meeting 116 

Consultations  with  convertible  currency  countries 377 

Discriminatory  exchange  restrictions  by  certain  industrial  countries, 

improvement 123 

Latin  American  exchange  problems 386 


INDEX  783 

International  Monetary  Fund — Continued  Page 

Measures  to  improve  and  strengthen 37,  116,  117,  353 

Notes  of  United  States  as  payments  to.     See  Notes,  Special  notes  of 
United  States. 

Repa  yments  of  drawings  by  foreign  countries 123 

Standby  arrangements  with  foreign  countries 122,  3G9,  388 

Statement  by  the  Secretary  of  the  Treasury  on  the  annual  report 380 

Subscription  by  U.S 744 

United  Kingdom  repurchases  of  drawings 122 

International  organizations,  conferences  and  commissions 131,  134,  444 

International  Peace  and  Security  Act  of  1961,  proposed 370 

Interstate  Commerce  Commission  expenditures 424 

Interstate  Commission  on  Potomac  River  Basin  expenditures 424 

Intertrust  fund  transactions: 

1948-61 476 

1961  and  estimates  1962  and  1963 487,  488 

Intragovernmental    revolving    funds,    expenditures    1960    and    1961    and 

monthly  1961  on  net  basis 428-447 

Investment  in  plant  and  equipment,  tax  credit  proposal 23,24,33,102,104,105, 

109,  304,  305,  313-320,  339,  365 

Italian  claims  fund 715 

Italy,  prepayment  on  debt  to  United  States 28 


Jet  fuel  tax  proposal 68,  103,  312,  339,  484 

Jewelry  tax 484,  493 

Joint  Defense,  United  States- Canada  Ministerial  Committee  on 133 

Joint  United  States-Canadian  Committee  on  Trade  and  Economic  Affairs-        133 
Judicial  Procedure,  Commission  on  International  Rules  of,  expenditures.-       425 

Judicial  survivors  annuity  fund 460,  466,  472,  638,  656 

Judiciary,  the,  expenditures 73,420,486 

Justice,  Department  of: 
Expenditures: 

1960  and  1961  and  monthly  1961 442 

1961  and  estimates  1962  and  1963 73,  486 

Trust  account  receipts  and  expenditures  1960  and  1961 468,  477 

K 
Korea  (North)  foreign  assets  control 135,  205 

L 
Labor,  Department  of: 
Expenditures: 

1960  and  1961  and  monthly  1961 442 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 681 

States  and  local  units 678 

1961  by  States  and  programs  for: 

Individuals,  etc 696 

States  and  local  units 690 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 459 

Trust  account  receipts  and  expenditures  1960  and  1961  and  monthly 

1961 462,468 

Labor-Management  Policy,  Presidsnt's  Advisory  Committee  on 32,  354,  422 

Labor-Management  Reports,  Bureau  of,  expenditures 442 

Labor  Standards,  Bureau  of,  expenditures 442 

Labor  Statistics,  Bureau  of,  expenditures 444 

Land  Management,  Bureau  of,  expenditures 440 


784  INDEX 

Latin  America:  P»ee 

Act  of  Bogota 357-363 

Alliance  for  Progress 40,  115,  124,  357,  358,  360 

Charter  of  Punta  del  Este 40,  115,  125 

Development  Assistance  Group  (DAG) 358 

Economic  and  social  development  assistance 40, 

115,  124,  125,  126,  357,  360,  369,  385,  386 

Economic  Commission  for 359 

Exchange  agreements 40,  121 

Export-Import  Bank  loans 126,  386 

Indebtedness  to  United  States  by  country  and  major  program 731 

Inter- American  Development  Banli 41, 

115,  125,  126,  357,  360-363,  385,  387 

Inter- American  Economic  and  Social  Council 115,  124,  125 

Inter- American  Program  for  Social  Progress 124,  357,  363 

Operation  Pan  America 357,  360,  361,  385 

Organization  for  Economic  Cooperation  and  Development,  working 

relationship 359 

Organization  of  American  States 124,  125,  358,  361 

President's  proposals 115,  358,  385 

Social  Development  Program 358,  363 

Social  Progress  Trust  Fund  Agreement 125 

U.S.  private  investment 125,  386 

Law  enforcement  activities: 

Customs,  Bureau  of 151,  156,  709.  710 

Internal  Revenue  Service 26,  103,  177,  196,  311,  335 

Narcotics,  Bureau  of 209-213 

Treasury  Law  Enforcement  Officers  Training  School 140 

U.S.  Coast  Guard 216 

U.S.  Secret  Service 191,  227-230 

Laws,  Public  No.: 

87-66,  June  30,    1961,   authorizing  adjustments  of    outstanding  old 

series  currency 297 

87-69,  June  30,  1961,  temporarily  increasing  the  public  debt  limit 297 

Legal  tender  notes  (see  also  U.S.  notes) 534 

Legislative  branch: 

Expenditures 73,  420,  486 

Trust  accounts,  etc.,  receipts  and  expenditures  1960  and  1961  and 

monthly  1961 460,466 

Lend-lease  and  surplus  property  (World  War  II) : 

Foreign  currencies  acquired 172,  724,  732 

Foreign  indebtedness  to  United  States 172,  730,  732 

France,  postponement  of  payment 173 

Payments,  including  silver 134,  172,  208,  732,  735 

Liberty  bonds  and  Victory  notes 534,  563 

Library  of  Congress  trust  funds 639,  657 

Life  insurance  companies.  Federal  security  holdings: 

1960  and  1961,  by  type  of  security 628 

1961,  June  30 99 

Liquor  occupations  taxes 484 

Liquor  taxes.     See  Alcohol  taxes. 

Loans  (see  also  Foreign  assistance  by  United  States,  Foreign  Government 
indebtedness  to  United  States) : 

By  Government  corporations  and  agencies,  by  type  of  loan 746 

By  Treasury  to  Government  corporations  and  agencies 171 

Realization  upon  U.S.  loans  and  investments: 

1960  and  1961  and  monthly  1961 418 

1961  and  estimates  1962  and  1963 485 

Longshoremen's  and  Harbor  Workers'  Compensation  Act  fund 639,  658 

Luggage,  handbags,  wallets,  etc.,  ta.xes 484,  493 


INDEX  785 

M  Page 

Machines,  business  and  store,  taxes 484,  492 

Management  improvement  program 42-44, 

139-141,  154,  159,  169,  175,  178,  186,  200,  209,  213,  222,  225 
Manufacturers'  excise  tax  collections: 

1929-61  by  sources 492 

1960  and  1961 65 

1961  and  estimates  1962  and  1963 484 

Rate  extension 104 

Transfer  to  highway  trust  fund  of  revenue  from  buses,  trucks,  and 

trailers 70,  109 

Maritime  activities: 
Expenditures: 

1960  and  1961  and  monthly  1961 432 

Federal  aid  to  States  for  State  marine  schools: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 680 

States  and  local  units 675 

1961  payments  by  States  for: 

Individuals,  etc 693 

States  and  local  units 684 

Loans  outstanding 739,  742,  746,  747 

Public  enterprise  revolving  fund  receipts  andjexpenditures  1960  and 

1961 459 

Matches  tax 484 

Medical  assistance.     See  Social  security. 

Merchandise  entries  into  United  States 145,  701 

Merchant  marine  memorial  chapel  fund 639,  640 

Mexico: 

American-Mexican  Claims  Commission 714 

Mexican  claims  fund 714 

Military  assistance.     See  Defense,  Department  of;  Foreign  Assistance  by 

U.S.;  National  defense  expenditures. 
Military  functions.     See  Defense,  Department  of. 

Military  housing  insurance  fund 511 

Minerals  Exploration,  Office  of 747 

Mines,  Bureau  of,  receipts  and  expenditures 442,  459 

Minor  coin: 

In  circulation,  Federal  Reserve  Banks,  and  Treasury,  and  stock 207, 

630,  632,  635-637 

Manufactured  1960,  pieces  and  face  value 206 

Seigniorage 208 

Mint,  Bureau  of 205-209,  446,  752 

Miscellaneous  excise  taxes 65,  104,  485,  493,  494 

Miscellaneous  receipts: 

1953-61 478 

1960  and  1961 65,  418 

1961 67 

1961  and  estimates  1962  and  1963 69,  70,  485 

Refunds 486 

Miscellaneous  taxes 485 

Mixed  Claims  Commission,  United  States  and  Germany 174,  712,  729 

Monetary  developments,  international.     See  International  financial  and 

monetary  developments. 
Money  (see  also  specific  kinds) : 

Circulation  by  kinds  June  30,  1913-61 636 

Coins: 

Production 206 

Uncirculated  sets,  sale 191 

Counterfeit,  investigations  and  seizures 227 

Location  of  gold,  silver,  and  coin  held  by  Treasury 637 

Per  capita,  in  circulation 632 

Stock  by  kinds  June  30,  1913-61 635 

Stock   in   Treasury,   in   Federal   Reserve   Banks,   and  in   circulation 
June  30: 

1913-61 634 

1961  by  kinds 632 


786  INDEX 

Monthly  Statement  of  Receipts  and  Expenditures  of  the  U.S.  Govern-     Page 

ment __    166,  167,  403 

Municipalities  and  States.     See  State,  local,  and  territorial  governments. 

Mutual  mortage  insurance  fund 270,  271,  511,  513,  530,  537,  561,  638,  640 

Mutual  savings  banks: 

Governmental  security  holdings: 
Federal  securities: 

1941-61,  selected  dates 98 

1952-61,  June  30 625 

1960  and  1961,  June  30,  by  type  of  security 628 

1961  changes 98,  100 

Allotments 604 

Exchanges 87 

Nonguaranteed  securities  of  Federal  instrumentalities  June  30, 

1952-61 625 

State,    local,    and   territorial   governmental   securities   June   30, 

1952-61 625 

Taxation  proposal 25,  103 

Mutual  security  {see  also  International  Cooperation  Administration) : 

Defense  assistance  program 738 

Expenditures   1960  and  1961 422,458 

Foreign    currencies   acquired   without  purchase   with   dollars,   trans- 
actions and  balances 724 

Foreign  governments'  indebtedness  to  U.S 730 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 458 

N 

Narcotic  and  marihuana  laws  enforcement 151,  209,  398 

Narcotic  Control  Act  of  1956,  effect  on  penalties  and  control  measures 210 

Narcotics,  Bureau  of 209-213,  397,  398,  446,  752 

Narcotics  Manufacturing  Act  of  1960,  establishment  of  basic  classes  for 

authorized  narcotic  drugs 211 

National    Advisory    Council   on    International    Monetary    and    Financial 

Problems 40,  114,  127,  204,  348,  368,  370 

National  Aeronautics  and  Space  Administration,  expenditures: 

1953-61 479 

1960  and  1961  and  monthly  1961 424 

1961  and  estimates  1962  and  1963 73,  486 

National  Archives  gift  fund 658 

National  Archives  trust  fund 477,  639 

National  bank  and  Federal  Reserve  Bank  notes 512,  541,  552,  573 

National  bank  notes 298,  535,  630,  632-637 

National  banks: 

Assets  and  liabilities 142 

Number,  capital  stock  changes,  and  liquidation 143 

National  Cancer  Institute  gift  fund.     See  Public  Health  Service,  Gift  funds. 

National  Capital  Housing  Authority: 

Investments 639 

Receipts  and  expenditures 424,  466,  477 

National  Capital  Planning  Commission: 

Expenditures 424 

Loans  outstanding 747 

National  Capital  Transportation  Agency  expenditures 426 

National  debt.     See  Federal  securities;  Public  debt. 

National    defense    expenditures    (see    also    Atomic    Energy    Commission; 
Defense,  Department  of): 

1953-61 71,478 

1957-61 71 

Military  assistance   1953-61 478 

National  defense  housing  insurance  fund 511,  513,  530,  537,  561,  638 

National  Export  Expansion  Council 34 


INDEX  787 

National  Institutes  of  Health  expenditures:  Page 

1960  and  1961  and  monthly  1961 440 

Federal  aid  payments  to  individuals,  etc 681 

National  Labor  Relations  Board  expenditures 426 

National  Mediation  Board  expenditures 426 

National  Park  Service: 

Account  for  preservation  of  birthplace  of  Abraham  Lincoln,  invest- 
ments made  by  Treasury  1952-61 639 

Expenditures 442 

National  park  trust  fund 639,  659 

National  Science  Foundation: 
Expenditures: 

1960  and  1961  and  monthly  1961 426 

1961  and  estimates  1962  and  1963 486 

Federal  aid  to  States  by: 

Appropriation  titles  for  individuals,  etc 682 

Payments  by  States  and  programs  for  individuals,  etc 697 

Public  enterprise  revolving  fund  receipts  and  expenditures 458 

National  service  life  insurance  fund: 

Certificates  of  indebtedness  and  Treasury  notes  and  bonds  issued  to: 

Description 533 

Interest 516 

Issues  and  redemptions 533,  547,  552,  562 

Outstanding 511,  516,  533,  562,  660 

Investments 472,  482,  638,  660 

Receipts  and  expenditures: 

1952-61 482 

1960  and  1961 460,  466,  547,  552 

Statement,  1961  and  cumulative 659 

Nationals,  U.S.,  international  claims  of 173,  712,  714,  715 

Natural  resources,  expenditures  1953-61 479 

Naval  records  and  history  fund 639 

Navy,  Department  of: 

Defense  housing  profits  paid  to  Treasury 749 

Defense  production  guarantees 746 

Expenditures: 

1789-1961 411 

1960  and  1961  and  monthly  1961 434-439 

Intragovernmental  fund  receipts  and  expenditures  1960  and  1961 436 

Public  enterprise  revolving  fund  receipts  and  expenditures: 

1960  and  1961 459 

1960  and  1961  and  monthly  1961 436 

Netherlands,  prepayment  on  debt  to  United  States 28 

Nonbank  investors  governmental  security  holdings: 

Federal  securities: 

1941-61  by  investor  classes 98 

1952-61  by  investor  classes 625 

1961  changes 98,  101 

1961,  June  30 97 

Nonguaranteed  securities  of  Federal  instrumentalities   1952-61,   by 

investor  classes 625 

State,  local,  and  territorial  government  securities  1952-61,  by  investor 

classes 625 

Nonbudget  accounts,  explanation 407 

North  Atlantic  Treaty  Organization 134 

Notes    (see    also    Federal    Reserve   Bank   notes;    Federal    Reserve  notes; 
National  bank  notes;  United  States  notes;  Victory  notes): 

Engraved,  printed,  and  delivered 711 

Special  notes  of  United  States: 

International  Development  Association  series: 

Issues  and  redemptions  1961 100,  504,  544,  573 

Outstanding: 

1961,  June  30 512,  517,  534,  541,  573 

Description 534 

Limitation,  statutory,  application 541 


788  INDEX 

Notes — Continued 

Special  notes  of  United  States — Continued 
International  Monetary  Fund  series: 

Issues  and  redemptions:  Page 

1952-61 504 

1960  and  1961  and  monthly  1961 544,  548 

1961 100,573 

Outstanding: 

1952-61 512 

1960  and  1961 573 

1961 517,  534 

Description 534 

Limitation,  statutory,  application 541 

Treasury : 

Marketable: 

Allotments  by: 

Federal  Reserve  districts 242 

Investor  classes 95,  604 

Exchanges 94,  237,  241,  242,  257,  544,  548,  576-600 

Interest: 

Computed  charge  and  rate,  June  30,  1959-61 618 

Computed  rate 516 

Expenditures  1957-61 620 

Investor  classes,  June  30,  196J  and  1961 628 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 545,  548 

1961 16,  89,  91-94,  237,  239,  242,  557,  566,  576-603 

Calendar  1961 16,  19 

Circulars. 

Issue  of  November  15,  1960 237 

Issue  of  February  15,  1961 239 

Summary  1961 241 

Outstanding: 

1952-61,  June  30   510 

1960  and  1961,  June  30 82,  557,  566,  628 

1961,  June  30 516,  520,  534 

Description 520 

Limitation,  statutory,  application 541 

Ownership  changes  1961 101 

Prices  and  yields,  June  30,  1960  and  1961 623 

Savings  (matured); 

Interest,  computed  charge  and  rate  June  30,  1942-55 618 

Outstanding  June  30: 

1952-55 510 

1960  and  1961 568 

1961 534 

Redemptions: 

1960  and  1961  and  monthly  1961 548 

1961 568 

Special  issues,     tiee  Trust  account  and  other  transactions. 
Tax  (matured) : 

Outstanding  June  30: 

1960  and  1961 568 

1961 534 

Redemptions  1961 568 

Notes  and  bonds,  U.S.  Government,  held  by  foreign  countries 119,  718 

O 

Officers,  administrative  and  staff  of  Treasury  Department 48 

Oils,  lubricating,  tax 484,  492 

Old  demand  notes 534,  573 

Old  Series  Currency  Adjustment  Act 188,  297 

Operation  Pan  America 357,  360,  361,  385 


INDEX  789 

Page 
Orders,  Treasury  Department 393 

Organization  chart  of  the  Treasury  Department  1961 46 

Organization  for  Economic  Cooperation  and  Development  (OECD) : 

Cooperation  among  countries 37,  134,  351,  353 

Development  Assistance   Committee    (DAC)    {see  also   Development 

Assistance  Group) 40 

Development  Assistance  Group 131,  358,  373 

European  Monetary  Agreement 132 

Framework  for  close  consultation  with  European  authorities 36, 

116,  121,  350,  377 

Latin  America,  working  relationship 359 

Purposes  and  establishment 116,  131,  349,  359,  365 

Successor  to  Organization  for  European  Economic  Cooperation 131,  349 

Organization  for  European  Economic  Cooperation  (OEEC).    See  Economic 
Cooperation  and  Development,  Organization  for. 

Organization  of  American  States 124,  359 

Outdoor  Recreation  Resources  Review  Commission  expenditures 426 

P 

Pakistan,  aid  to 41,  128,  129,  37 

Panama  Canal  Company: 

Borrowing  power 738 

Interest  paid  to  Treasury 749 

Interfund  transactions  1953-61 454 

Investments  1952-6 1 640 

Receipts  and  expenditures  1960  and  1961 438,  459 

Paper  currency: 

By  denominations  in  circulation 633 

Deposits  for  retirement  of  national  bank  and  Federal  Reserve  Bank 

notes 512,  541 

Engraved,  printed,  and  delivered 711 

In  circulation,  Federal  Reserve  Banks,  and  Treasury,  and  stock 632-636 

Issued,  redeemed,  and  outstanding 190,  637 

Unfit,  destruction  by  Federal  Reserve  Banks 190 

Patent  Office  expenditures 432 

Payments  to  the  public.     See  Cash  income  and  outgo. 

Payroll  savings  plan  for  U.S.  savings  bonds 184,  224 

Payroll  taxes.    See  Employment  taxes;  Social  security,  Legislation  enacted 
in  1961. 

Peace  Corps  Act,  taxation  provisions  for  civilian  employees 112 

Pension  and  retirement  funds: 
Federal  security  holdings: 

Allotments 604 

Corporate  pension  trust  funds: 

1960  and  1961 629 

1961 100 

State  and  local  governments 604 

Taxation 108,  344 

Pershing  Hall  Memorial  fund 639,  660 

Personnel,  Treasury  Department: 

Management 43,  139 

Number,  by  bureaus,  etc.,  quarterly  June  30,  1960  to  1961 752 

Persons  and  vehicles  entering  United  States 145,  708 

Persons,  transportation  taxes 67,  104,  485,  493 

Philippine  Islands: 

Account  in  U.S.  Treasury  for  payment  of  pre-1934  bonds 176,  639,  661 

Prepayment  on  debt  to  United  States 28 

Securities,  payments  by  Treasurer  of  United  States  as  agent 192 

Photographic  equipment  taxes 484 

Pistols  and  revolvers,  taxes 484 

Playing  cards  tax 484 

Poland,  claims  fund 174 


790  INDEX 

Post  Office  Department:  Page 

Advances  from  Treasury  to  cover  postal  deficiency  1916-61 499 

Expenditures: 

1916-61 499 

1960  and  1961  and  monthly  1961 444 

1961  and  estimates  1962  and  1963 73,  4S6 

Post  offices,  issuing  agents  for  Series  A-E  savings  bonds 184 

Postal  revenues,  expenditures,  and  surplus  or  deficit  1916-61 499 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 444,  459 

Reconciliation  of  postal  money  orders  in  Treasurer's  Office 186 

Postage  stamps,  new  issues 710 

Postal  Savings  System: 
Deposits: 

1946-61 539 

Security  for 192 

Investments  1952-61 638 

Treasurer,  U.S.,  liabilities 79,  630 

Treasury  notes  issued  to,  outstanding  June  30,  1952-57 511 

Withdrawals,  funds  provided  for 96 

Postal  Service.     See  Post  Office  Department. 

Prefabricated  housing  loans  program 454,  739 

President: 

Funds  appropriated  to: 
Expenditures: 

1960  and  1961 458 

1960  and  1961  and  monthly  1961 422,  460,  466 

1961 685 

1961  and  estimates  1962  and  1963 73,  486 

Interfund  transactions  1952-61 454 

Message,  April  20,  1961,  relating  to  the  Federal  tax  system 24,  102,  303 

Proposal  for  Latin  America 385 

Protection  by  U.S.  Secret  Service 226 

Recommendations  on: 

Balance  of  payments,  U.S 27, 

30,  115,  348,  350,  352,  353,  365,  374-376 

Taxes 23,  24,  67,  102-105,  .303.  313,  330 

Statement,  October  27,  1961,  on  the  new  programs  to  stimulate  Ameri- 
can exports,  strengthen  the  U.S.  balance  of  payments,  and  enlist 

the  maximum  cooperation  of  private  credit  facilities 348 

President's  Advisory  Committee  on  Government  Organization 422 

President's  Advisory  Committee  on  Labor-Management  Policy 32,  354,  422 

Price  and  wage  stability 32 

Production  credit  associations,  investment  fund 424,  458 

Production  credit  corporations,  investments  1952-57 640 

Products,  receipts  from  sales  1961  and  estimates  1962  and  1963 485 

Property,  Federal  personal  and  real: 

Expenditures  1960  and  1961  and  monthly  1961 426 

Receipts  from  sales: 

1960  and  1961  and  monthly  1961 418 

1961  and  estimates  1962  and  1963 485 

Property,  transportation  taxes 68,  493 

Public  debt  (see  also  Circulars;  Federal  securities;  specific  classes): 

Accounts,  basis 404 

Advance  refunding 15,  17,84-87,90-94,  246 

Allotments.     See  Public  debt,  Marketable  securities. 

Cash  refunding 15,  16,  88,  89,  91-93 

Changes 64,  80,  180,  409,  489,  554,  605 

Description,  amounts  issued,  retired,  and  outstanding 518-536 

Disposition  of  matured  marketable  securities 94 

Effect  of  Federal  financial  operations  1961  and  estimates  1962  and 

1963 489 

Financing  operations,  summary  tables 92-95,  236,  241,  255,  266 

Foreign  countries,  holdings 119,  718 


I 


INDEX  791 

Public  debt — Continued 

Interest :  Pag© 

Checks  issued 184 

Computed  charge  and  rate: 

1916-61,  June  30 616 

1939-61,  June  30,  by  security  classes 618 

Computed  rate,  June  30,  1961,  by  security  classes 516 

Expenditures: 

1789-1961 411 

1940-61  by  tax  status _  621 

1953-61 "  480 

1957-61 71 

1957-61  bv  security  classes 620 

1960  and  i961 446 

1961  and  estimates  1962  and  1963 73,  486 

Decrease 71 

Reporting  basis 404 

Rates : 

1961  by  issues 574 

Balance  of  payments,  U.S 14,  15,  19,  20,  38,  354-356,  376 

Uniformity  in  bases  for  special  issues 74,  171 

Investments  of  Government  agencies  in  securities: 

1952-61 482,  638,  744 

1960  and  1961  and  monthly  1961 472 

1961  and  estimates  1962  and  1963 488 

Government-sponsored  enterprises 470,  472,  482 

Issues  and  redemptions  (receipts  and  expenditures) : 

1960  and  1961  and  monthly  1961  by  security  classes __    _    __       544  548 

1960  and  1961 188 

1961  by  security  classes 93,  94,  554,  574-603 

Cumulative  by  issues 518-533 

Legislation  affecting 297 

Limitation,  statutory.     See  Public  debt.  Outstanding. 
Management: 

Advance  refunding 15,  17,  84,  85,  87,  90-94,  246 

Balance-of-payments'  considerations 13-15,  19,  20,  38,  354-356,  376 

Cash  refunding 15,  16,  88,  89,  91-93 

Objectives 13,  15,  19,  83 

Policies,  problems,  and  proposals 13-20 

Strip  bills,  technique  innovation 15,  17,  83,  87,  92 

Temporary  debt  limit  increase  essential 299 

Marketable  securities: 
Allotments  by: 

Federal  Reserve  districts 237,  242,  256 

Investor  classes 95,  604 

Changes 82 

Description 518 

Issues  and  redemptions: 

1960  and  1961  and  monthly  ]961 544 

1961 15-20,  89,  93,  233-269 

Maturity  distribution: 

1946-61,  June  30 515 

1960  and  1961,  June  30 628 

1961,  chart 84 

1961  program 15-17,  83,  90 

Maturity  extensions  in  advance  refundings,  chart 85 

Outstanding  June  30: 

1952-61 510 

1960  and  1961 81,  82,  554-558,  628 

1961 516,  518 

Ownership: 

Changes 101 

Summary  by  investor  classes  1960  and  1961 628 


792  INDEX 

Public  debt — Continued 

Matured,  outstanding:  Page 

1853-196],  June  30 507 

1952-61,  June  30 511 

1960  and  1961,  June  30 81,  563-573 

1961,  June  30 517,  534 

Limitation,  statutory,  application 541 

Transferred  to,  by  issues  1961 554 

Nonmarketable  securities 17,  81,  84,  96,  97,  101,  510,  544,  628 

Offerings  by  issues  1961 93,  233-269 

Old  Series  Currency  Adjustment  Act,  effect  on 188,  297 

Operations: 

1961 89-97,  233-269,  544 

Calendar  1961  and  1962 15-20 

Operations  and  ownership  of  Federal  securities 80- 101 

Outstanding: 

1790,  December  31,  to  June  30,  1961,  gross 507 

1853-1961,  June  30,  interest-bearing,  matured  and  noninterest- 

bearing,  and  gross 507 

1916-61: 

Changes 605 

Chart 81 

Interest-bearing 616 

1932-61,  June  30,  and  monthly  1961 409 

1934-61,  June  30,  gross 539 

1946  and  1961,  comparisons  of  public  and  private  debt,  per  capita 

debt,  and  public  debt  as  a  percentage  of  GNP,  chart 83 

1952-61  by  security  classes 510 

1952-61,  increase  or  decrease 505 

1960  and  1961,  June  30 81,  554 

1961,  June  30,  and  description 518-536 

1961,  June  30,  bj^  security  classes 516 

1961  and  estimates  1962  and  1963 489 

Federal  financial  operations,  effect  on 489 

Forecast  for  1962  at  semimonthly  intervals,  based  on  constant 

operating  cash  balance 302 

Limitation,  statutory: 
Amounts  subject  to: 

1938-61 409 

1961 517,535,541 

Estimated  1961  and  1962 302 

Legislative  history 542 

Obligations  affected  June  30,  1961 541 

Temporary  increase 96,  297,  299 

Ownership: 

Calendar  1962,  by  investor  classes 18 

Changes 98-101 

Chart 99 

Summary  by  investor  classes  1960  and  1961 628 

Treasury  survey  expansion 100 

Per  capita  gross  debt: 

1853-1961,  June  30 507 

DecHne  since  1946 82 

Prices  and  yields,  pviblic  marketable  securities: 

1941-61  monthly  and  annual  average  yield  of  taxable  long-term 

Treasury  bonds 622 

1953-61  monthly  and  annual  average  market  yield  trends  of  short- 

and  long-term  securities 88 

1960  and  1961,  June  30,  by  issues 623 

1961  prices  and  rates  of  Treasury  bills 266 

Pattern  of  rates  by  length  of  maturity,  charts 355 

Registered,  individual  accounts  for  other  than  savings  bonds 184 

Regulations  affecting 274-297 

Sinking  fund  for  retirement 606,  607 


INDEX  793 

Public  debt — Continued 

Special  issues  to  Government  investment  accounts: 

Interest:  Page 

Computed  charge  and  rate,  June  30,  1939-61 618 

Computed  rate  by  funds,  etc.,  June  30,  1961 516 

Expenditures: 

1940-61 621 

1957-61 620 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961  by  funds,  etc 546,  550 

1961 560 

Outstanding: 

1952-61,  June  30,  by  funds,  etc 510 

1960  and  1961,  June  30 81,  560,  628 

1961,  June  30,  by  funds,  etc 516,  527 

Description  by  funds,  etc 527 

Limitation,  statutory  application 541 

Ownership,  changes 101 

Statutory  retirements,  1918-61 605,  606 

Tax  status 535 

Public  debt  and  guaranteed  obligations.     See  Federal  securities. 

PubUc  Debt,  Bureau  of 177-185,  446,  752 

Public  enterprise  revolving  funds: 

Investments 472,  482 

Loans  outstanding  by  agency 746 

Receipts  and  expenditures: 

Gross  1961  and  net  1960  and  1961 458 

Net  basis  1960  and  1961  and  monthly  1961 420-449 

Sales    and   redemptions   of   obligations   of    Government   agencies   in 

market  (net) 474,  483 

Public  faciUty  loans 456,  736-741,  747,  749 

Public  Health  Service: 
Expenditures: 

1960  and  1961  and  monthly  1961 440 

Federal  aid  to  States: 

1930,  1940,  1950,  1961  by  appropriation  titles  for: 

Individuals,  etc 680 

States  and  local  units 676 

1961  payments  by  States  and  programs  for: 

Individuals,  etc 694 

States  and  local  units 687 

Gift  funds 639,662 

Hospitals,  patients'  benefit  fund 639 

Loans  outstanding 747 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 : 440,459 

Public  Housing  Administration: 

Borrowing  power 738 

Capital  stock  owned  by  United  States 736 

Expenditures,   Federal  aid  payments  to  States  and  local  units  for 
annual  contributions: 

1950  and  1961  by  appropriation  titles 679 

1961  by  States 691 

Interest  paid  to  Treasury 749 

Interfund  transactions  1950-61 454 

Loans  outstanding 746,  747 

0>^ligations,  held  by  Treasury 736,  738,  739,  741 

Pu^'lic  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 : 428,458 

Public  Roads,  Bureau  of: 

Expen  ditures 432 

Federal  aid  to  States  for  highway  construction 684 

Public  Works  Administration 606,  747 

Puerto  Rican  securities,  payments  by  Treasurer  of  United  States  as  agent.        192 
Puerto  Rico,  payments  to  for  taxes  collected 446 


794  INDEX 

Page 
Punta  del  Este,  Charter  of 40,  115,  125 

R 

Radios,  phonographs,  television  sets,  etc.,  taxes 484,492 

Railroad  retirement  account: 

Intertrust  fund  transactions    1954-61 476 

Investments 472,  482,  488,  638,  663 

Receipts  and  expenditures: 

1952-61 482 

1960  and  1961 460,  464,  466 

1961  and  estimates  1962  and  1963 487 

Proposed  legislation  estimate 487 

Statement,  1961  and  cumulative 662 

Transfers  to: 

1938-61 416 

1953-61 478 

1960  and  1961 66,420,460 

1961  and  estimates  1962  and  1963 485 

Treasury  notes  issued  to: 

Description 533 

Interest 74,  516 

Issues  and  redemptions 533,  546,  552,  562 

Outstanding 511,  516,  533,  562,  663 

Railroad  Retirement  Act,  eligibility  requirements  for  benefits 107 

Railroad  Retirement  Tax  Act.     See  Employment  taxes. 

Railroad  unemployment  insurance  account 427,  664 

Railroads,  loans  to 746 

Receipts    {see   also    Customs,    Collections;    Employment    taxes;    Internal 
revenue;  Miscellaneous  receipts;  specific  taxes). 

1789-1961 410 

Budget: 

1925-61  (net  basis) 414 

1932-61  and  monthly  1961  (net  basis) 408 

1952-61  (net  basis) 501 

1953-61  (net  basis) 478 

1953-61,  chart 63 

1960  and  1961  (net  basis) 64 

1960  and  1961  and  monthly  1961 418 

1961 8 

Calendar  1961 21 

1961  and  estimates  1962  and  1963 68-70,  484 

1962  and  1963  estimates 9,12 

Corporate  and  excise  rate  extensions,  revenue  effect 104 

Net,  derivation  of 420,  486 

Summary  for  1961 64-67 

Transfer  of  Federal  Unemployment  Tax  Act  collections  to  trust 

fund 64,67 

Deductions: 

Interfund  transactions 65,  69,  414,  420,  450-457,  478,  486 

Transfers  and  refunds ^     414 

Transfers  to  trust  accounts 420,  478,  485 

Exercise  of  monetary  authority  1952-61 500 

From  the  public  1952-61 500 

Public  enterprise  funds.     See  Public  enterprise  revolving  funds. 
Trust  account  and  other  transactions.     See  Trust  account  and  other 
transactions. 
Reclamation,  Bureau  of: 

Dividends  and  interest  paid  to  Treasury 749 

Loans  outstanding 747 

Public  enterprise  revolving  fund 440 

Receipts  and  expenditures 440,  459 

Reconstruction  Finance  Corporation: 

Earnings  and  interest  paid  to  Treasury 749 

Interfund  transactions  1933-58 451 

Investments  1952 _ 640 


INDEX 


795 


Reconstruction  Finance  Corporation — Continued  Page 

Liquidation.-      158  ^^^.  ^  g 

Loans  outstanding ~,-,'  ,,,_ 

Obligations:  i-*^,  nt 

Held  by  Treasury _  _        y^^  ™,,g 

Held    outside    Treasury,    1961,    June    30, "inteVesr  on" "matured'    '  '' 

outstanding -..o 

Securities  and  commitments ~ III..  V')9 

Recoveries  and  refunds,  receipts """418  485 

Rectification  tax "_        '  ^^^ 

Refrigerators,  air  conditioners,  etc.,  taxes ]  434  492 

Refugee  relief ' '  ^^4 

Refunds  of  receipts: 

1931-61 417 

1953-61 470 

1960  and  1961 -"-'^"-.'"65,420 

1961  and  estimates  1962  and  1963 '  4gg 

Customs -""4i7,"420,  497 

Employment  taxes qq 

Excise  taxes (;5 

Interest  paid : 

1953-61 480 

1960  and  1961 446 

Internal  revenue: 

1931-61 417 

1953-61 478 

196U  and  1961 193,  420 

1961  by  States '  496 

Regulations  applicable  to  the  public  debt 274-297 

Renegotiation  Board  expenditures 426 

Rent,  receipts  from,  1961  and  estimates  1962  and  1963 485 

Reporting  and  accounting  changes,  Government 64 

67,  70,  108,  109,  119,  164-169,  341,  476,  487,  488 

Report  on  Foreign  Currencies  in  Custody  of  the  Treasury  Department 167 

Retailers'  excise  tax  collections: 

1942-61  by  sources _        _    _  493 

1960  and  1961 ..  65 

1961  and  estimates  1962  and  1963 484 

Retirement   funds,  Federal   employees  {see  also   Civil  service  retirement 

and  disability  fund :  Foreign  service  retirement  fund) : 

Intertrust  fund  transactions  1955-57 476 

Investments: 

1952-61 482,  638 

1960  and  1961  and  monthly  1961 472 

1961  and  estimates  1962  and  1963 488 

Receipts  and  expenditures: 

1952-61 482 

1960  and  1961  and  monthly  1961 460,  466 

1961 424 

1961  and  estimates  1962  and  1963 487 

Revolving  and  management  fund  accounts,  explanation 407 

Rivers  and  harbors  and  flood  control  ex^ienditures 438 

Rovalties,  receipts  from: 

'  1960  and  1961  and  monthlv  1961 418 

1961  and  estimates  1962  and  1963 -185 

Rubber  program  expenditures 427 

Rumanian  claims  fund "15 

Rural  Electrification  Administration: 

Borrowing  power "38 

Expenditures  1960  and  1961  and  monthly  1961 432 

Interest  paid  to  Treasury J49 

Loans  outstanding "46 

Obligations  held  bv  Treasury 736,  738,  739,  741 

Securities  held  in  custody  of  Treasurer  of  United  States,  1960  and  1961.  192 

614359—62 51 


796  INDEX 

s 

Page 

Safe  deposit  box  tax 485 

Safety  program 141,  157,  161,  175,  221 

Saint  Elizabeths  Hospital: 

Expenditures 440 

Unconditional  gift  fund 639 

Saint  Lawrence  Seaway  Development  Corporation: 

Borrowing  power 738 

Interest  paid  to  Treasury 749 

Interfund  transactions  1960  and  1961 456 

Obligations  held  by  Treasury 736,  738,  739,  741 

Receipts  and  expenditures  1960  and  1961 426,  458 

Savings  and  loan  associations: 

Federal  security  holdings 100,  629 

Taxation  proposal 25,  103 

School  lunch  program  expenditures 430 

Secretaries,  Under  Secretaries,  and  Assistant  Secretaries  of  the  Treasury 

from  September  11,  1789,  to  January  20,  1961 1       389 

Secretary  of  Agriculture: 

Borrowing  power . 738 

Interest  paid  to  Treasury. .' 750 

Obhgations  held  by  Treasury 736-739,  741,  743 

Secretary  of  Commerce: 

Borrowing  power 738 

Obhgations  held  by  Treasury 736-739,  742 

Secretary  of  Defense,  Office  of,  expenditures 434,  436 

Secretary  of  the  Interior: 

Borrowing  power 738 

Functions  delegated  to 395 

Interest  paid  to  Treasury 750 

Obhgations  held  by  Treasury 737-739,  743 

Secretary'  of  the  Treasury : 
Borrowing  under: 

Defense  Production  Act  of  1950 737-739,  743 

Federal  Civil  Defense  Act  of  1950 737-739,  742 

Joint  announcement.   May   17,   1961,  by  Secretary  of  the  Treasury 
Dillon  and  the  Minister  of  Finance  of  Brazil  of  the  conclusion  of 

financial  negotiations  between  the  United  States  and  Brazil 368 

Offices  established: 

Congressional  Relations 42,  397 

Executive  Secretariat 42,  396 

Financial  Analysis 42 

Remarks  and  statements: 

February  14,  1961,  before  the  Senate  Foreign  Relations  Com- 
mittee on  ratification  of  the  Organization  for  Economic  Co- 
operation and  Development  Convention 349 

March  7,  1961,  before  the  Joint  Economic  Committee 351 

March  14,  1961,  before  the  House  Ways  and  Means  Committee  on 

financing  the  Federal  highway  program 341 

April  11,  1961,  at  the  second  meeting  of  the  Board  of  Governors 
of  the   Inter-American    Development   Bank,   Rio   de  Janeiro, 

Brazil 357 

April  28,  1961,  before  the  Senate  Appropriations  Committee  on 

the  Act  of  Bogota  and  the  proposed  Fund  for  Social  Progress. _       360 
May  2,  1961,  before  the  U.S.  Council  of  the  International  Cham- 
ber of  Commerce,  New  York,  X.Y 364 

May  3,  1961,  before  the  House  Ways  and  Means  Committee  on  the 

President's  tax  program 313 

May  10,  1961,  before  a  Subcommittee  of  the  House  Committee  on 
Banking  and  Currency  on  a  proposed  amendment  to  the  Arti- 
cles of  Agreement  of  the  International  Finance  Corporation 367 

June  5,  1961,  before  the  Senate  Foreign  Relations  Committee  on 
the  proposed  Act  for  International  Development  and  the  Inter- 
national Peace  and  Security  Act 369 


1 


INDEX  797 

Secretary  of  the  Treasury — Continued 

Remarks  and  statements — Continued 

June  19,   1961,  before  the  Subcommittee  on  International  Ex-     Page 

change  and  Payments  of  the  Joint  Economic  Committee 374 

June  27,  1961,  before  the  Senate  Finance  Committee  on  a  new 

temporary  public  debt  limit 299 

September  20,  1961,  on  the  annual  report  of  the  International 

Monetary  Fund 380 

Transmittal  of  the  1961  Annual  Report  to  the  President  of  the  Senate 

and  the  Speaker  of  the  House  of  Representatives in 

Secretary,  Under  Secretaries,  General  Counsel,  and  Assistant  Secretaries  of 

the  Treasury  Department,  January  21,  1961-January  8,  1962 47 

Securities  (see  also  Federal  securities;  Public  debt): 

Government,  ownership  of 625 

Guaranteed  by  United  States.     *See  Corporations  and  certain  other 
business-type  activities  of  U.S.  Government,  Obligations. 

Held  in  custody  of  Treasurer  of  United  States 192 

Not  guaranteed   by   United   States.     »See   Corporations   and   certain 

other  business-type  activities  of  United  States,  Obligations. 
Owned  bv  United  States: 

1960"^  and  1961,  June  30 ^ 736 

Foreign  government  obligations 728 

Principal  classes 77 

Securities  and  Exchange  Commission  expenditures 426 

Seigniorage: 

Deposits  by  Bureau  of  the  Mint 208 

Receipts  from: 

1960  and  1961  and  monthly  1961 418 

1961  and  estimates  1962  and  1963 485 

Selective  Service  System  expenditures 426 

Servicemen's  mortgage  insurance  fund 272,  511,  513,  530,  537,  561,  638 

Silver  (see  also  Minor  coin;  Seigniorage) : 

Assets  and  liabilities  in  account  of  Treasurer  of  United  States 187,  630 

Balance  in  general  account  of  Treasurer  of  United  States 79,  630 

Bullion : 

Stock 187,  208,  630,  632,  635,  637 

Tax  on  sales  or  transfers 484 

Certificates: 

Engraved,  printed,  and  delivered 711 

In  circulation.  Federal  Reserve  Banks,  and  Treasury,  and  stock-      630, 

632,  633,  636 

Issued  and  redeemed 637 

Old  Series  Currency  Adjustment  Act  effect 189,  297 

Lend-leased    to    foreign    governments,    repayments,    and    status    of 

accounts 135,  172,  208,  735 

Monetized 187,208 

Production  and  use 208 

Subsidiary  coin: 

Coinage 206 

In  circulation.  Federal  Reserve  Banks,  and  Treasurv,  and  stock,      207, 

208,  630,  632,  635-637 

Transactions  at  mint  institutions 208 

Sinking  fund,  cumulative,  for  debt  retirement 606,  608 

Small  Business  Administration: 

Depreciation,  survey  with  Treasury  Department 110 

Expenditures 73,  426,  486,  679,  691 

Interest  paid  to  Treasury 749 

Interfund  transactions  1954-61 -  ^  454 

Loans  outstanding "47,  748 

Obligations  held  by  Treasury,  June  30,  1955-57 739 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 426,  458 

Smithsonian  Institution  expenditures 426 

Social  Development  Program 358,  363 


798  INDEX 

Social  Progress:  Page 

Fund  for 360,  361,  362 

Inter- American  program  for 124 

Trust  Fund  Agreement 125 

Social  security  (see  also  Employment  taxes;  specific  trust  funds;  Taxation) : 
Administration: 
Expenditures: 

1960  and  1961  and  monthly  1961 440 

Federal  aid  to  States: 

1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 681 

States  and  local  units 677 

1961  payments  by  States  and  programs  for: 

Individuals 696 

States  and  local  units 688 

Legislation  enacted  1961,  summary  of  new  provisions 106 

Medical  assistance 107 

Pension  plans  by  self-employed 345 

Public    enterprise    revolving   fund    receipts    and    expenditures    1960 

and  1961 459 

Soil  bank  program  expenditures 430 

Soil  Conservation  Service  expenditures 430 

Southeast  Asia  Treaty  Organization 134 

Southeastern  Power  Administration  expenditures 440 

Southwestern  Power  Administration  expenditures 440 

Space  research  and  technology  expenditures  (see  also  National  Aeronau- 
tics and  Space  Administration  expenditures) 72,  479 

Spain,  loan  to 738 

Special  fund  receipt  and  expenditure  accounts,  explanation 406 

Sporting  goods,  taxes 484 

Stamp  taxes.     See  Documents,  other  instruments,  and  playing  cards. 

Stamps,  engraved,  printed,  and  delivered 710,  711 

Stamps,  U.S.  savings: 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 544,  550 

1961 224,573 

Outstanding  June  30: 

1952-61 512 

1960  and  1961 573 

1961 534 

Limitation,  statutory,  application 541 

Regulations  governing  sales  at  schools 293,  297 

Sales,  decrease 224 

Standards,  National  Bureau  of: 

Earnings  paid  to  Treasury 749 

Expenditures 434 

State,  Department  of  (see  also  Agency  for  International  Development) : 
Expenditures: 

1960  and  1961  and  monthly  1961 444 

1961  and  estimates  1962  and  1963 73,486 

Federal  aid  to  States  and  local  units 678 

Loans  outstanding 748 

Trust  accounts,  etc.,  receipts  and  expenditures  1960  and  1961 462,  468 

State,  local,  and  territorial  governments: 

Cooperation  with  Treasury  bureaus 44 

Federal  aid  to,  expenditures: 

1930,  1940,  1950,  and  1961  by  appropriations  titles 675-682 

1961  by  States  and  programs 683-692 

Governmental  security  holdings: 
Federal  securities: 

1941-61  selected  dates 98 

1952-61 625,  627 

1961 98,  100 

Allotments 604 


INDEX  799 

State,  local,  and  territorial  governments — Continued 

Governmental  security  holdings — Continued  Page 

Nonguaranteed  securities   of   Federal  instrumentalities    1952-61 

by  investor  classes 625 

State,    local,    and    territorial    government    securities    June    30, 

1952-61 625,  627 

Internal  revenue  collections  and  refunds 496 

Loans  to,  by  Government  agencies 747 

Securities: 

Held  by  various  classes  of  investors  and  by  tax  status  June  30, 

1952-61 626 

Offerings,  decrease 356 

Withholding  of  income  taxes  from  Federal  employees 176 

State  unemployment  accounts 664 

Stock  transfers  tax 484 

Strategic  and  critical  materials 428 

Strip  bill  issues 15,  17,  83,  87,  92,  93,  95,  260,  261,  268,  520,  555,  604 

Subversive  Activities  Control  Board  expenditures 426 

Sugar  tax 111,  485,  494 

Surety  bonds 171 

Surplus  or  deficit,  U.S.  Government: 

1789-1961 411 

Budget: 

1932-61  and  monthly  1961 408 

1953-61 481 

1953-61,  chart 63 

1960  and  1961 8,  64,  448 

1961  and  estimates  1962  and  1963 9,  11,486,489 

Economic  considerations 5 

Surplus  property  disposal  (see  also  Lend-lease  and  surplus  propertjO ^^24,  734 

T 
Tables,  bases  of 403 

Tariff  Act  of  1930,  amended  to  reduce  dutv  exemption  on  U.S.  tourists' 

purchases _" 158,  353,  365 

Tariff  Commission  expenditures 426 

Tariff  lowering  under  proposed  Trade  Expansion  Act 36,  39 

Tariff  Negotiations  Conference  (GATT) 132 

Tax  and  loan  accounts.  Treasury: 

I960' and  1961,  June  30 630 

1961,  June  30 188 

Changes  1952-61,  analysis 631 

Tax  Court  of  the  United  States: 

Expenditures 426 

Judges'  dependents'  annuity  system  enacted 113 

Tax  evasion  convictions 198 

Tax-exempt  and  taxable  Government  securities,  terms 535 

Tax  policy  (see  also  Taxation) 4,  21-26,  67,  102-105,  303,  313,  330,  356 

Taxation  (see  also  Internal  Revenue;  specific  taxes): 

Account  numbers  for  taxpayers,  proposal 25,  103,  105,  311,  340 

Aviation  fuels,  proposals 68,  103,  104,  312,  339,  344 

Cooperatives,  current  earnings  tax  proposals 25,  103,  310,  338 

Corporation  income  tax  rate  extension 67,  103,  104,  312,  313,  339 

Depletion  allowances  on  brick,  tile,  clay,  etc 112 

Depositary  receipts  procedure 176 

Depreciable  business  property,  capital  gains  reform  proposal.  25,  103,  310,  337 
Depreciation: 

Allowances,  administrative  revisions 24,  102,  109,  305,  314 

Survey 110 

Developments  1961 21-26,  102-114,  303-348 

Dividends  and  interest: 

Credit  and  exclusion,  repeal  proposal 25,  103,  308,  333-335 

Withholding  proposal 25,  102,  308,  330-333 

Excise  taxes,  rate  extension 67,  103,  104,  109,  312,  313,  339 


800  INDEX 

Taxation — Continued  Page 

Expense  account  abuses,  recommendations  to  curb 24,  103, 

114,  309,  335-337 

Fire  and  casualty  insurance  companies,  proposal 25,  103,  310,  338 

Foreign  central  banks,  certain  exemption  from  tax  on  U.S.  Gov'ern- 

ment  obligations 111 

Foreign  income  preferential  treatment,  proposals  to  modif\': 

Estate  tax  exemption  on  foreign  real  estate 24,  308,  330 

Foreign  investment  firms  and  investment 102,  307,  313,  320,  327 

Foreign     subsidiaries,     income     tax     allowance     and     dividends 

credit 24,  39,  102,  308,  327 

Tax  deferral  privileges  and  tax  havens 24,  39,  306,  320-327,  366 

U.S.  citizens  living  abroad 24,  307,  328 

Health  insurance  program,  proposal  for  the  aged 107,  487 

Highway  system.  Federal,  proposals  to  finance  completion 102,  108,  341 

Individual  income  tax  rates,  adjustment  power  for  President  proposed.  25 

Inventory  reporting  abuses,  proposal  to  correct 26,  103,  312 

Investment  in  plant  and  equipment,  tax  credit  proposal 23,  24,  33,  39. 

102,  104,  105,  109,  304,  305,  313-320 

Jet  fuels  tax,  proposal 68,  103,  312,  339 

Laws,  administrative  interpretation  and  clarification 113 

Legislation  enacted  by  87th  Congress,  first  session 25,  103-113 

Mutual  savings  banks  and  savings  and  loan  associations,  deductible 

reserves  review 25,  103,  104,  105,  310,  339 

Narcotic  drugs.  Canal  Zone 398 

Peace  Corps  Act,  civilian  employees,  provision 112 

Pension  plan  proposals  for  self-employed  and  persons  not  covered 

bv 108,  344-348 

Polfcv 21-26,  356 

President's  recommendations 23,  24,  67,  102-105,  303,  313,  330 

Public  school  employees'  annuities,  tax  treatment 113 

Reform,  long-range 23,  26,  102,  303,  313,  330 

Revenue  estimates,  basis 67 

Small  business  corporation  to  partnership,  time  extension  for  change.-        Ill 

Social  Security  Amendments  of  1961,  provisions 106,  107 

Social  security  revisions,  benefit  and  tax  increases 105-108 

Stock  life  insurance  companies,  provisions 111 

Students,  teachers,  trainees,  as  specified,  provisions 112 

Sugar,  manufactured,  provisions 111 

Temporary    Extended    Unemployment    Compensation    Act   of    1961, 

provisions 105 

Transportation,  proposed  changes 67 

Truck  weight  tax  study 109 

Telephone,  general  service,  tax 67,  104,485,493 

Telephone,  telegraph,  etc.,  tax 485,  493 

Television  tax.     See  Radios,  phonographs,  television  sets,  etc. 
Tennessee  Valley  Authority: 

Borrowing  power 738 

Earnings  paid  to  Treasury 749 

Expenditures: 

1961  and  estimates  1962  and  1963 ^     486 

Federal  aid  pa3'ments  to  States  and  local  units 679,  692 

Interfund  transactions  1939-1956 450 

Investments 472,  640 

Obligations: 

Held  by  Treasury,  June  30,  1952-55 739 

Held  outside  Treasurv: 

Outstanding  1955-61 514 

Transactions  (net) 474,  488 

Receipts  and  expenditures  1960  and  1961 426,  458 

Territories,  Office  of 442,  459,  747 

Thrift  and  Treasury  savings  stamps 535,  573 

Tires,  tubes,  and  tread  rubber,  taxes 109,  342,  484,  492 

Tobacco  taxes 65,  67,  104,  198.  484,  491 

Toilet  preparations  tax 484,  493 


INDEX  801 

Page 

Transportation  and  commerce  expenditures,  1953-61 479 

Transportation  taxes: 

Persons 67,  104,  485,  493 

Property 68,  485,  493 

Treasurer  of  the  United  States: 
Account  of  the: 

Assets  and  liabilities: 

1960  and  1961,  June  30 630 

Explanation 79-80,  187 

Balance,  June  30: 

1916-61 605 

1932-61  and  monthly  1961 409 

1960  and  1961 80,  188,  630 

1961 79,  188 

1961  and  estimates  1962  and  1963 489 

Cash  operating,  1961  and  estimate  1962 302 

Increase  or  decrease: 

1916-61  and  cumulative 605 

1932-61  and  monthly  1961 409 

1952-61 500 

1960  and  1961 64 

1961 630 

1961  and  estimate  1962 489 

Deposits,  withdrawals,  and  balances: 

1952-61 500 

1960  and  1961 188 

Tax  and  loan  accounts  1952-61 631 

General  account 630 

Gold 187,  630 

Net  cash  transactions: 

1952-61 500 

1961 80 

Published  in  Daily  Statement  of  the  U.S.  Treasury 79,  403 

Silver _' 187,630 

Verification  of  cash,  currency,  and  securities 168 

Office  of I 168,  185-192,  446,  752 

Treasury  Bulletin 76,  167,  745 

Treasury,  Department  of: 

Administrative  and  staff  officers,  January  8,  1962 48 

Automatic  data  processing  (ADP) 1 43,  139,  196,  200,  202 

.Awards  program 139,  141,  157,  161,  175,  179,  186,  209,  213,  222 

Circulars,  Department.     See  Circulars,  Department. 

Compliance  officer,  designation  of  principal 400 

Congressional  Relations,  Office  of 42,  397 

Defense  production  expansion 746 

Depreciation,  survey 110 

Dividends,    interest,    etc.,    received   from    Government   corporations 

1960  and  1961 749 

Economies  in  management 139 

Employee  training  program 43,  139,  202,  225 

Employees,  number,  quarterly,  June  30,  1960  to  1961 752 

Ethical  Standards,  establishment  of  Ad  Hoc  Advisory  Committee  on_       400 

Executive  Secretariat,  establishment 42,  396 

Expenditures: 

1960  and  1961  and  monthly  1961 446 

1961  and  estimates  1962  and  1963 -.   73,486 

Federal  aid  payments  to  States  and  local  units  by  appropi  iation 

titles 678 

Financial  Analysis,  Office  of,  establishment 42 

Foreign  exchange  reporting  system 119 

Interfund  transactions  1933-61 451 

Internal  auditing 140,  160,  168,  203 

International  meetings,  participation  in 133 

Loans  outstanding 746,  747 


802  INDEX 

Treasury,  Department  of- — Continued  Page 

Long-range  planning  study 44 

Management  improvement  program.     See  Management  improvement 
program. 

Organization  and  procedure,  orders  relating  to 393 

Organization  chart,  December  1,  1961 46 

Organizational  improvements 42 

Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 446,  459 

Secretary,  Under  Secretaries,  General  Counsel,  and  Assistant  Secre- 
taries, January  21,  1961-January  8,  1962 47 

Space  and  property  improvements 140 

Succession  order  among  Treasury  officials 399 

Supervision  of  bureaus 393,  394 

Trust  account  receipts  and  expenditures  1960  and  1961 462,  468 

Treasury  notes  of  1890 189,  298,  630,  632,  633,  636,  637 

Treasury  savings  certificates  (matured) 534,  573 

Trust  account  and  other  transactions  (see  also  Cash  income  and  outgo; 
Government  investment  accounts;  Public  debt,  special  issues;  specific 
fundsj : 

Interest  rates,  effect  of  new  laws 74,  171 

Investments  of  Government  agencies  in  public  debt  securities,  net: 

1952-61 482,  638 

1960  and  1961  and  monthly  1961 472 

1961 80 

1961  and  estimates  1962  and  1963 488 

Summary  for  1961 74 

Receipts  or  expendituies,  net: 

1932-61  and  monthly  1961 408 

1952-61  by  major  classifications 482 

1960  and  1961 64 

1960  and  1961  and  monthly  1961 460 

1961  and  estimates  1962  and  1963 487,  488 

Intertrust  funds  deducted: 

1948-61 476 

1961  and  estimates  1962  and  1963 487,  488 

Proposed  legislation  estimates 487 

Sales   and    redemptions    of   obligations   of   Government   agencies   in 
market  (net) : 

1952-61 483,  505 

1960  and  1961  and  monthlv  1961 474 

1961 - 80 

1961  and  estimates  1962  and  1963 488 

Summary  for  1961 74 

Transfers  to: 

1937-61 416 

1961  and  estimates  1962  and  1963 485 

Trust  and  deposit  fund  accounts: 

Expenditures  (except  net  investments) : 

1952-61 482,502 

1960  and  1961  and  monthlv  1961 466 

1961  and  estimates  1962  and  1963 489 

Explanation 74,  407 

Receipts : 

1952-61 482,  501 

1960  and  1961  and  monthlv  1961 460 

1961  and  estimates  1962  and  1963 489 

Receipts  or  expenditures,  net  1960  and  1961  and  monthly  1961-.       470 
Uninvested  trust  funds,  interest 446 

Trust  enterprise  revolving  fund,  receipts  and  expenditures  1960  and  1961-.       477 
Trust   funds  and    certain    other  accounts    of   the    Federal   Government, 

1952-61 638 


INDEX  803 

u 

Unemployment  compensation:  Page 

Benefits  extended 7,  105 

Credits  against  employment  taxes 108 

Expenditures 443,  678,  681,  696 

Repayment  of  advances  to  general  fund 70 

Taxes 106,  107 

Unemployment  trust  fund: 

Balances,  summary 666 

Certificates  of  indebtedness  issued  to: 

Description 533 

Interest,  computed  rate 516 

Issues  and  redemptions 533,  546,  552,  562 

Outstanding 511,  533,  562 

Employment  security  administration  account 1 70, 

443,  459,  464,  470,  665,  669 

Federal  extended  compensation  account 465,  471,  665,  669 

Federal  unemployment  account 465,  666,  669 

Intertrust  fund  transactions,  1953-61 476 

Investments 472,482,488,638,  667 

Railroad  unemployment  insurance  account 470,  487,  664,  669 

Railroad  unemployment  insurance  administrative  fund 664 

Receipts  and  expenditures: 

1952-61 482 

1960  and  1961 446,  459,  464,  470 

1961  and  estimates  1962  and  1963 487 

Proposed  legislation  estimates 487 

State  accounts: 

Balances,  1960  and  1961 668 

Deposits  and  withdrawals 464,  470,  487,  664,  668 

Earnings 664,  668 

Statement,  1961  and  cumulative 664 

Transfers  to: 

1961 64,66,416,420,478,668 

1961  and  estimates  1962  and  1963 485 

USSR  claims  fund 715 

United  Kingdom: 

Anglo-American  Financial  Agreement  of  1945,  payment  of  principal 

and  interest 173 

Lend-lease  and  surplus  property  obligations 730,  733,  734 

Repayments  to  International  Monetary  Fund 123 

U.S.  private  investment 131 

United  Nations,  loan  to 748 

U.S.  Army  and  Air  Force  Motion  Picture  Service  investments 640 

U.S.  balance  of  payments.     See  Balance  of  payments,  U.S. 

U.S.  Coast  Guard 141,213-222,396,446,752 

U.S.    Government    corporations.     See    Corporations    and    certain    other 

business-type  activities  of  U.S.  Government. 
U.S.  Government  life  insurance  fund.     See  Government  life  insurance  fund. 

U.S.  Housing  Authority -- 450,  679 

U.S.  Housing  Corporation 450 

U.S.  Information  Agency: 

Expenditures 426,486 

Informational  media  guaranty  fund: 

Borrowing  power 738 

Interest  paid  to  Treasury 749 

Interfund  transactions  1959-61 456 

Obligations  held  by  Treasury 737,  739,  742 

Receipts  and  expenditures 458,  724 

U.S.  Naval  Academy: 

General  gift  fund 640,  671 

Museum  fund 640 


804  INDEX 

U.S.  notes:  Page 

Engraved,  printed,  and  delivered 711 

In  circulation.  Federal  Reserve  Banks,  and  Treasury  and  stock,  630,  632-636 

Issued,  redeemed,  and  outstanding 637 

Old  Series  Currency  Adjustment  Act  effect 188,  298 

Public  debt  item  (U.S.  notes  less  gold  reserve),  outstanding  June  30: 

1952-61 512 

1960  and  1961 573 

Limitation,  statutory,  not  subject  to 541 

U.S.  obligations.     See  Federal  securities. 

U.S.  private  investment  abroad 24,  102,  118,  130,  306,  320,  321,  327,  366,  386 

U.S.  savings  bonds.     See  Bonds,  U.S.  Government. 

U.S.  Savings  Bonds  Division 223-225,  752 

U.S.  Secret  Service 225-230,  446,  752 

U.S.  Study  Commissions  expenditures 426 

Urban  renewal  fund 428,  454,  458,  679,  691,  736,  738,  739,  741,  747,  749 

V 
Vehicles,  use  tax 485 

Vehicles  and  persons  entering  United  States 145,  708 

Veterans'  Administration: 

Benefit  payment  and  accounting  procedures,  centralization 169 

Borrowing  power.     See  Veterans'  direct  loan  program. 

Earnings,  interest,  and  profits  paid  to  Treasury 750 

Expenditures  (see  also  Veterans'  benefits  and  services): 

1960  and  1961  and  monthly  1961 426 

1961  and  estimates  1962  and  1963 73,  486 

Federal  aid  to  States: 

1930,  1940,  1950,  and  1961  by  appropriation  titles  for: 

Individuals,  etc 682 

States  and  local  units 679 

1961  payments  by  States  and  programs  for: 

Individuals,  etc 697 

States  and  local  units 692 

General  post  fund  investments 639 

Loans  outstanding 746,  748 

Obligations  held  by  Treasury.     See  Veterans'  direct  loan  program. 
Public  enterprise  revolving  fund  receipts  and  expenditures  1960  and 

1961 426,458 

Veterans'  benefits  and  services,  expenditures: 

1953-61 480 

1957-61 72 

1960  and  1961  and  monthly  1961 426 

Veterans'  direct  loan  program: 

Borrowing  power 738 

Interest  paid  to  Treasury 750 

Interfund  transactions  1951-61 454 

Loans  outstanding 746 

Obligations  held  by  Treasury 737-739,  742 

Veterans'  life  insurance  funds: 

Investments 472,488,638 

Receipts  and  expenditures: 

1960  and  1961  and  monthly  1961 460,  466 

1961  and  estimates  1962  and  1963 487 

Veterans'  Reemployment  Rights,  Bureau  of,  expenditures 442 

Veterans'  special  term  insurance  fund: 

Certificates  of  indebtedness  issued  to: 

Description 533 

Interest,  computed  rate 516 

Issues  and  redemptions: 

1960  and  1961  and  monthly  1961 546,  553 

1961 1 562 

Outstanding 511,  516,  533,  562 

Investments 638 

Loans  outstanding 748 


INDEX  805 

Page 
Victory  notes,  outstanding  June  30,  1960  and  1961,  and  redemptions  1961  _.  563 
Virgin  Islands  Corporation: 

Borrowing  power 738 

Interest  paid  to  Treasury 749 

Interfund  transactions  1949-61 454 

Loans  outstanding 746,  747 

Obligations  held  by  Treasury 737-739,742 

Receipts  and  expenditures 442,  459 

Vocational  Rehabilitation,  Office  of,  expenditures 438,  689 

W 

Wage  and  Hour  Division  expenditures 444 

Wage  and  price  stability 32 

Wagering  tax 485 

War  housing  insurance  fund 272,  511,513,  531,537,  561,638 

Warrants  issued  basis  of  data 404 

Weather  Bureau  expenditures 434 

Wines  tax 104,484,491 

Withheld  taxes.     See  Individual  income  taxes. 

Women's  Bureau  expenditures 444 

Working  fund  accounts,  explanation 407 

Workmen's  Compensation  Act  fund 640,  672 

Y 

Yields  of  Treasury  securities.     See  Public  debt.  Prices  and  yields. 

Yugoslav  claims  fund 714 


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