To the Congress of the United States:
The Administration in cooperation with the Congress has moved promptly and vigorously to reduce earlier recommendations for appropriations for the fiscal year 1953-54 by about $13 billion and to reduce the prospective deficit by about one-half.
However, operations for the fiscal year just ended have produced a deficit of $9.4 billion. In addition, the Government on June 30th was faced with $81 billion of appropriations authorizing expenditures for which the money must be provided as the bills are presented from time to time.
Despite our joint vigorous efforts to reduce expenditures, it is inevitable that the public debt will undergo some further increase.
On June 30th last the public debt was $266 billion. To meet the Government's cash requirements for this current quarter it was necessary to borrow over $6 billion in July, bringing the national debt now to over $272 billion. To meet necessary expenditures and to maintain a safe working balance of funds it will be necessary to borrow more money before the next session of the Congress. This will carry the debt above the present legal limit of $275 billion.
Under present circumstances, the existing statutory debt limit is so restrictive that it does not allow the financial operating leeway necessary to conduct the government's fiscal affairs effectively. This is specific with respect to the seasonal variations of federal receipts and disbursements and also in view of the uncertainty as to the future income and expenditure levels.
I must, therefore, request of the Congress legislation raising the statutory debt limit. It is my recommendation that the limit should be increased to $290 billion.
DWIGHT D. EISENHOWER