The Financing of Federal Authorities.

The article discusses economic policies of agencies of the Federal government of the United States. The use by the federal government of semi-autonomous corporations and agencies to accomplish certain quasi-commercial tasks has always been controversial. Many of the quasi-commercial and revenue-producing operations of government should be put in the hands of semi-independent, self-financing agencies and kept completely out of the unified Federal budget. This would reduce the size of the budget and, since the expenditures thus made extra-budgetary would very probably exceed the revenues similarly affected, it would also make for a budget surplus. Administratively, there seem to be some major drawbacks to the extra-budgetary idea in general and to the security issuing process in particular. Unfortunate effects on the government securities market may occur when issues are allowed to reach the market from several sources. When the extra-budgetary paper is sold to about the same group of investors as the regular Treasury issues, a certain element of competition could arise. Real financial independence for an agency of the Federal government seems unlikely.