The Veterans' Bonus Last week the American House of Representatives
passed the Pittman Bill which authorises the issue of 811.000,000,000 (E2,200,000,000) of new currency to be paid in bonuses to the American war veterans. On Tuesday the Senate Finance Committee approved Senator Harrison's proposal that payment should be made by the issue of $50 interest-bearing bonds, convertible into cash at the post offices. The Senate proposals allow President Roosevelt to assent to the Veterans' Bonus Bill without committing himself to a purely inflationary measure. In form, at least, they are not inflationary : they would -increase spending by forcing into circulation idle currency whose issue has already been authorised, and they would .avoid the psychological effects of direct inflation. This addition to Government expenditure, together with the increases forced on the President by the recent decisions of the Supreme Court, may endanger the stability of the 1937 Budget ; but President Roosevelt is, no doubt, more immediately concerned with this year's Presidential election. The Senate proposals offer him a means of escape both from committing himself to inflation and from losing the electoral support which the Veterans' Bonus commands.
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