The President's News Conference
THE PRESIDENT. I have received a number of questions about naval expenditure. Apparently the press is much more interested in the Navy than they are in the other departments, where equal reduction of expenditure is under consideration.
I have received the proposals of the high officials of the Navy of their plans for reducing expenditures. They are being considered in the light of maintaining efficiency in the Navy itself. As I said, such plans are underway in every department of the Government. All of these proposals of the departments are part of the process of final working out of the budget. No conclusions have been reached as to any particular proposed reduction in expenditure of the departments as yet. Final decision will not be reached until the budget is ready for presentation to Congress itself. All of the principal officers of the Government are cooperating to bring down expenditures. As a matter of fact, the processes of the budget are somewhat different this year from normal in that we have asked the departments to take into full consideration the economic situation of the country and to propose specific methods by which they can cooperate. In times when the income of the people is reduced and when taxes and loans stifle economic recovery, there is only one fiscal policy and that is to reduce the expenditure of the Government to the last cent consonant with the obligations of the Government itself.
There are two difficulties that confront us in reducing expenditures. The first is the large proportion of Federal expenditures that are irreducible. You will recollect that the interest must be paid on the public debt; statutory reduction of the debt must be continued; the pay allowances, pensions to veterans, pensions to civil servants, and a number of other expenditures are statutory, and they comprise nearly 2 billions of expenditure that is impossible of reconsideration. So that any reductions in Government expenditures have to be applied to one-half of the budget.
The second difficulty is that the Federal Government must make its contribution to expand employment so long as this situation continues. That is a little difficult to interpret for the prospect of a budget beginning the 1st of next July. I am in hopes that a change in the situation by that time will make it possible for us to lighten up the burden of the Government in that direction.
I realize that governmental economy as a whole is strongly desired by the public, yet every variety of expenditure has its adherents. They are all naturally solicitous that their special project be continued, even in times of national difficulty, and they are somewhat impatient with reductions and deferments and delays of projects. Public opinion supports drastic economies in general, and it will need to reach out into every special project and drive. And what is more, the public must support the administration--should support the administration in discouragement of special interests who desire to expand services of the Government in these periods. The essential services of the Government must and will be maintained, but these are times, when we have a large deficit facing the country, that even meritorious projects must and will be deferred.
I have received word today of the plans worked out by the Southern banks under the leadership in cooperation with the Federal Farm Board in a definite plan for pooling a certain proportion of the cotton crop and financing the farmer members of that pool. All of which is constructive action of the type that the country needs. That is, that the banking community and the commercial community should join together in cooperation with governmental agencies to solve problems of this character.
I understand further meetings have taken place in the South in connection with these plans, and I am in hopes that they will meet with
I haven't anything further today that is going on around the Government, but you may find it in the departments if you can.
Note: President Hoover's two hundred and fifteenth news conference was held in the White House at 12 noon on Friday, October 16, 1931.
On the same day, the White House issued a text of the President's statement on Government expenditures (see Item 359).
At a conference in New Orleans on October 12, representatives of the Federal Farm Board, the American Cotton Co-operative Association, and the banking institutions of the cotton-growing States reached an agreement to hold some 6,800,000 bales of cotton off the market until July 31, 1932. Under the terms of the agreement the banks promised to extend loans secured by cotton up to a figure of 3,500,000 bales, the Federal Farm Board to finance the holding of 2 million bales by the American Cotton Co-operative Association, and the Federal Farm Board's Cotton Stabilization Corporation to continue holding its accumulation of 1,300,000 bales. The plan was implemented in November 1931, following ratification by the State bankers' associations.
Herbert Hoover, The President's News Conference Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/207946